True indies in talks about how to flourish in consolidated market

Another week, another tale of multimillion-pound consolidation. The Broadcast team has barely left the office for the past few weeks (only a slight exaggeration) as we’ve churned out news stories and analysis on the recent frenzy of consolidation.

Deals between C5 and Viacom, ITV and Leftfield, and All3Media and Discovery, have now been followed by an early agreement for Shine, Endemol and Core Media to join forces. And still the dust hasn’t settled, with speculation that Fremantle will join the consolidation party shortly, after spending the early part of the year in talks with All3.

But where does that leave the industry’s smaller players and the (diminishing) group of ‘true’ indies? Seeking strength in numbers, apparently.

There is talk of a potential merger or alliance of a handful of mid-sized players, thought to be in the £5-10m turnover bracket. The plan, which is a reaction to the polarisation of the indie sector, is that the producers would come together as broadly equal partners, each bringing different things to the party.

That might be relationships with broadcasters or talent, or regional bases, or more general resources. Why, goes the thinking, should cost savings be the preserve of the super-indies? Overlap of central functions applies just as easily to merging small companies as it does to big ones.

But there are some key differences between the ongoing super-consolidation and the plans at the lower end of the market. The latter isn’t about achieving the best possible multiple, or designed as an exit strategy for anyone. Instead it’s about companies becoming more robust, and greater than the sum of their parts.

There would likely be big personalities involved, and there are some dissenting voices. One view is that a merger would be financially messy, without a single capital investor tying the companies up. Neither, it must be said, is there any crisis in the true indie sector.

Zig Zag is winning commissions in the US, Spun Gold and Keo Films seem to be hiring major execs on a weekly basis, and Love Productions can pick up Bafta nominations for shows as dramatically diverse as The Great British Bake Off and female genital mutilation doc The Cruel Cut.

But the logic of an indie tie-up remains sound and it will be interesting to see whether what at the moment are informal conversations become anything more concrete. The desire to future-proof is sensible, and it’s undoubtedly better to be proactive than be left behind by wider industry trends. The recent spate of deals has left us recalibrating what constitutes a ‘big’ producer – maybe it’s time to rethink what a small producer looks like too.

Chris Curtis is editor of Broadcast