BBC Worldwide

BBC Worldwide Ltd.
Public subsidiary
Industry Broadcasting
Predecessor BBC Enterprises
Founded 1995
Headquarters London, England, United Kingdom
Area served
 Worldwide
Key people
 Tony Hall
(Chairman)
Tim Davie
(CEO)
Parent BBC
Website www.bbcworldwide.com

BBC Worldwide Ltd. is the wholly owned commercial subsidiary of the BBC, formed out of a restructuring of its predecessor BBC Enterprises in 1995. The company exploits BBC brands, sells BBC and other British programming for broadcast abroad with the aim of supplementing the income received by the BBC through the licence fee.

In 2013/14, BBC Worldwide generated headline profits of £157.4m and headline sales of £1,042.3m and returned £173.8m to the BBC.[1]

In 2012/13 it made a profit of £156.3m on a turnover of £1,115.8m.[2] The company had made a profit of £104m on a turnover of £1,085m in the previous financial year.[3]

BBC Worldwide's profit rate was 11.2% in 2011/2012, up slightly from 9.6% the previous year, down from a peak of 21.5% in 2002/2003, contrasting with 7.8% in 2003/2004.[4]

History

Origins

In addition to broadcasting, the BBC has for much of its life also produced additional materials for sale, the profits of which would be returned to the corporation to aid in the financing of these services. The highest profile of these early products was the listings magazine Radio Times, however the net revenue gained from this in 1928 (£93,686, 10s, 1d) only equated to 10% of total BBC income.[5]

Prior to 1979, several BBC departments dealt with the exploitation and sale of BBC brands and programmes. BBC Publications, which produced magazines, books and other supplementary materials, had expanded rapidly in the late 1960s but still had difficulties with finances: in 1974 the division made a loss of £14,000.[5] This was rectified however as the economic situation eased and by 1982 BBC Publications had a trading profit of £4.7 million.[5] BBC Transcription Services licensed BBC Radio material to overseas broadcasters.

The exploit of television programmes was at first handled in 1958 with the establishment of a business manager post.[5] This gradually expanded until the establishment of the Television Promotions (later renamed Television Enterprises) department in 1960 under a general manager.[5] In its first year, the department saw the sale of 550 programmes overseas with a turnover of £234,000,[5][6] with a further 1,200 programmes sold the following year.[5] Radio programmes were only exploited on the same level with the creation of the Radio Enterprises department in 1965. However, following the retirement of the Radio Enterprises general manager in 1969, the two departments were merged to form the BBC Enterprises department.

BBC Enterprises

In 1979 the department became BBC Enterprises Ltd., a subsidiary company wholly owned by the BBC.[5][6] By 1982, the division were expanding with divisions responsible for home video (under the brand BBC Video), recorded audio (under the brands BBC Records and BBC Cassettes), film and merchanding. At this point the company had a turnover of £23 million.[5] On 1 April 1986, all commercial activities of the corporation, including BBC Publications, was merged into BBC Enterprises Ltd.[7]

In 1991 BBC World Service Television became the first commercially funded BBC broadcasting operation after the Foreign Office refused to pay for it.[8] BBC Enterprises Ltd was subsequently reorganised in 1995 as BBC Worldwide Ltd. A review of the BBC's commercial activities took place in 2004 and concluded that the sell off of BBC Worldwide's assets was not as advantageous as keeping the business and driving it harder. Instead, some changes to its remit, focus, structure and governance were made, e.g. that it would only publish titles in the UK linked to BBC programmes or key genres.

Acquisitions and restructuring

In 2004, BBC Video merged with VCI to form 2 Entertain, which was part owned by BBC Worldwide; the following year the company sold Eve magazine to Haymarket Group[9] and in 2006 the company sold a majority stake in BBC Books to publisher Random House.[10]

In 2007 BBC Worldwide purchased a 75% stake in the travel guide publisher Lonely Planet,[11] acquiring the final 25% of the company in 2011.[12] The acquisition was part of the BBC's strategy to grow its online portfolio and to increase its operations in Australia and the USA.[13]

In January 2009 it was announced that Ofcom had put forward the recommendation that Channel 4 merge with either the commercial network Five or BBC Worldwide. Channel 4's preferred option of a partnership with the latter was confirmed by chief executive Andy Duncan, who added: "We're in discussions with BBC Worldwide at the moment and they're really very exciting."[14] In the same year, the company was awarded the Queen's Award for Enterprise in recognition of the companies growth and success.[15]

In 2012, the company began to reorganise their divisions from a product based system to a location based system, resulting in Jana Bennett leaving the company.[16]

BBC Worldwide sold Lonely Planet in 2013 to Kentucky billionaire Brad Kelley's NC2 Media for US$75 million (£51.5 million)— significantly less than the £130.2 million the BBC had paid for the company, at an £80 million loss.[17]

BBC Worldwide profit and sales 1995–2012

Date Headline Sales (2014) Profit (2014) Sales (Cash) Profit (Cash) Profit rate
1995/1996 £527m £84m £332m £53m 15.9%[18]
1996/1997 £630m £115m £409m £75m 18.3%[4]
1997/1998 £640m £120m £430m £81m 18.8%
1998/1999 £726m £120m £495m £82m 16.5%
1999/2000 £798m £136m £560m £96m 17.1%
2000/2001 £885m £148m £632m £106m 16.7%
2001/2002 £881m £169m £640m £123m 19.2%
2002/2003 £879m £188m £657m £141m 21.4%
2003/2004 £917m £71m £706m £55m 7.7%
2004/2005 £991m £112m £784m £89m 11.3%
2005/2006 £992m £135m £810m £111m 13.7%
2006/2007 £1,076m £138m £916m £118m 12.8%
2007/2008 £1,134m £116m £1,004m £103m 10.2%
2008/2009 £1,219m £164m £1,074m £145m 13.5%
2009/2010 £1,256m £204m £1,158m £188m 16.2%
2010/2011 £1,119m £107m £1,085m £104m 9.5%
2011/2012 £1,115m £125m £1,115m £125m 11.2%

Historical price conversion as per RPI figures from "Office for National Statistics – Dataset selector". Retrieved 24 August 2013.

Operations

BBC Worldwide's London headquarters until 2008.

In 2013, BBC Worldwide reorganised the company along geographical, rather than divisional, lines to better serve its audiences around the world and to position itself to take advantage of opportunities in high growth markets. The seven geographic markets are grouped into three regions: North America; UK, Australia and New Zealand; and Global Markets (Asia, CEMA, Latin America and Western Europe). The two global business areas - Content and Brands - set the strategic framework and parameters for activities within the regions and keep a close connection into BBC Worldwide's parent, the BBC. Digital is embedded throughout the business.[19]

BBC Worldwide is responsible for a wide range of commercial activities, primarily connected in some way with the output and public purposes of the main BBC. In the past, the business was divided into five operating businesses which covered the entire operations of the company: Channels; Content and Production; Brands, Consumers and New Ventures, Consumer Products and Sales and Distributions.

The Channels division was formed in 2005[20] and is the company's largest generator of revenue and growth. It operates the broadcasting of several international channels and domestic networks:[20]

The Content and Production division was formed in 2006 and invests the company's money into new productions by both the BBC and other independent productions.[21] It also exploits the formats of BBC programmes and alters them to be suitable for an international audience – an example is the exploitation of the Strictly Come Dancing brand to become Dancing with the Stars – maximising revenues by receiving a production fee from the local broadcaster as well as a sum from selling the initial re-versioning rights.[21] The division works alongside the Sales and Distribution division, which sells the broadcasting rights to completed programmes made by the BBC and other producers – an example being the Red Production Company drama Mine All Mine for the ITV network in 2004. It includes the selling of individual clips through the BBC Motion Gallery to other broadcasters. In the financial year 2010/11, this division sold the rights to over 74,000 hours worth of television content.[22]

The other two divisions of the company deal with the individual programme brands: Global Brands focuses on the international recognition of the brands[23] while the Consumer Products division produces a variety of goods based around these brands. The work of the former includes expanding the brands into new areas – the Top Gear Live tour is a key example of this.[23] The latter creates and sells a variety of consumer products, occasionally as a stake or partnership in another company, including VHS and DVD releases, spoken word and music audio products, CD-ROMs, videogames, books and magazines.[24]

Assets and brands

These commercial activities allow BBC Worldwide to return profits and dividends to the BBC to re-invest in its broadcasting operations. In 2007/08 BBC Worldwide invested £75.1m in in-house and independent programmes commissioned by the BBC. However, the BBC has often been criticised for the amount of money it makes from BBC Worldwide. Some commercial rivals protest at the advantage the company has from being associated with and being able to exploit the programme catalogue and resources of the BBC to provide its goods and services.[32]

See also

References

  1. ↑ "BBC Worldwide – Annual Review 2013/14 – Annual Review 2014". Retrieved 14 August 2014.
  2. ↑ "BBC Worldwide – Annual Review 2012/13 – Annual Review 2013". Retrieved 14 August 2014.
  3. ↑ "BBC Worldwide – Annual Review 2011/12 – Annual Review 2012". Retrieved 6 September 2013.
  4. ↑ 4.0 4.1 "Annual Review". Retrieved 6 September 2013.
  5. ↑ 5.0 5.1 5.2 5.3 5.4 5.5 5.6 5.7 5.8 Cain, John (1992). The BBC: 70 years of broadcasting. London: British Broadcasting Corporation. pp. 116–119. ISBN 0-563-36750-4.
  6. ↑ 6.0 6.1 "1970s" (PDF). The BBC Story. BBC. Retrieved 5 June 2012.
  7. ↑ Cain, John (1992). The BBC: 70 years of broadcasting. London: British Broadcasting Corporation. p. 150. ISBN 0-563-36750-4.
  8. ↑ Crisell, Andrew (1997). An Introductory History of British Broadcasting. Routledge. p. 24. ISBN 0-415-12802-1.
  9. ↑ "BBC Worldwide announces sale of eve magazine to Haymarket". BBC Press Office. 11 January 2005. Retrieved 22 June 2012.
  10. ↑ 10.0 10.1 "The Random House Group acquires majority shareholding in BBC Books". BBC Press Office. 22 June 2006. Retrieved 22 June 2012.
  11. ↑ "BBC buys Lonely Planet". The Age. 1 October 2007. Retrieved 1 October 2007.
  12. ↑ "BBC takes last slice of Planet". The Sydney Morning Herald. 20 February 2011. Retrieved 5 March 2011.
  13. ↑ "BBC Worldwide acquires Lonely Planet". BBC Worldwide Press Release. BBC Press Office. 1 October 2007. Retrieved 19 March 2013.
  14. ↑ "Channel 4 'must form partnership'". BBC News. 21 January 2009. Retrieved 29 March 2009. Channel 4 should become part of a bigger organisation through a merger or partnerships, Ofcom has recommended.
  15. ↑ Shearman, Sarah (21 April 2009). "BBC Worldwide wins Queen's Enterprise award". MediaWeek. Retrieved 9 February 2015.
  16. ↑ "Jana Bennett to leave BBC Worldwide". BBC News. 22 June 2012. Retrieved 22 June 2012.
  17. ↑ "BBC Worldwide sells Lonely Planet business at £80m loss". BBC News. 19 March 2013. Retrieved 19 March 2013.
  18. ↑ "BBC Worldwide Annual Report and Accounts". Retrieved 6 September 2013.
  19. ↑ "About Us". BBC Worldwide. Retrieved 14 August 2014.
  20. ↑ 20.0 20.1 "Channels". BBC Worldwide. Retrieved 22 June 2012.
  21. ↑ 21.0 21.1 "Content & Production". BBC Worldwide. Retrieved 22 June 2012.
  22. ↑ "Sales & Distribution". BBC Worldwide. Retrieved 22 June 2012.
  23. ↑ 23.0 23.1 "Global Brands". BBC Worldwide. Retrieved 11 October 2012.
  24. ↑ "Consumer Products". BBC Worldwide. Retrieved 22 June 2012.
  25. ↑ "The Telegraph" Sony takes stake in Left Bank telegraph.co.uk. Retrieved 7 September 2012
  26. ↑ "BBC Worldwide buys into Cliffhanger". BBC Press Office. 22 November 2007. Retrieved 22 June 2012.
  27. ↑ "Penguin Books and BBC Worldwide form new venture for BBC Children's Books". BBC Press Office. 30 April 2004. Retrieved 22 June 2012.
  28. ↑ "BBC Worldwide partners with Random House Audio for new publishing and distribution deal". BBC Media Centre. 20 December 2013. Retrieved 31 March 2014.
  29. ↑ "BBC Worldwide announces sale of majority shareholding in BBC Audiobooks". BBC Press Office. 14 July 2010. Retrieved 22 June 2012.
  30. ↑ Sweney, Mark (14 July 2010). "BBC Audiobooks sold". Guardian. Retrieved 22 June 2012.
  31. ↑ "BBC Active signals new partnership for BBC Worldwide and Pearson Education". BBC Press Office. 13 October 2005. Retrieved 22 June 2012.
  32. ↑ "About BBC Worldwide". BBC Worldwide. 2008/09. Archived from the original on 6 October 2009. Retrieved 10 September 2009. Check date values in: |date= (help)

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