Background to the report

The BBC is the UK’s main public service broadcaster, providing a wide range of television, radio and digital services in the UK and internationally. Under its Royal Charter, the BBC can also undertake commercial activities, but they must be carried out by commercial subsidiaries of the BBC, and not directly by the BBC itself.

Jump to downloads

The BBC’s commercial activities are overseen by its wholly-owned subsidiary, BBC Commercial, and delivered by two principal commercial subsidiaries, BBC Studios and BBC Studioworks. Of these, BBC Studios is by far the largest, generating income in 2023-24 of £1,837 million, compared with £37 million from BBC Studioworks.

BBC Studios was formed out of a merger in April 2018 between two of the BBC’s commercial subsidiaries – its former content production and distribution businesses. BBC Studios aims to deliver value to licence fee payers through its mandate to deliver long-term, sustainable returns to the BBC.

Scope of the report

This report focuses on the performance of BBC Studios and covers:

  • the performance of BBC Studios from the 2018 merger to date
  • BBC Studios’ future plans
  • the governance and oversight of BBC Studios

Conclusions

To date, BBC Studios has succeeded in delivering increasing returns to the BBC. In the seven years up to and including 2023-24, it had returned £1,906 million to the BBC in dividends and payments through its production and distribution work with the BBC, exceeding its targets for this period.

BBC Studios has met its returns targets by substantially growing both its income and profits. Between 2018-19 and 2023-24, income increased to £1,837 million and profits to £202 million, such that BBC Studios has consistently met the BBC’s published profit margin target for it of between 9% and 11%.

BBC Studios has adapted to changes in the market to enable its growth to date, investing in its digital services, including its website and streaming, and increasing its production of programmes for third parties, including global streamers. It will need to ensure its strategic plans continue to evolve to deliver success in a dynamic and challenging market. It will also need high-quality internal performance reporting to identify areas for development in its business and monitor its progress in meeting its objectives.

The BBC and BBC Studios face challenges in ensuring that returns to the BBC are sustainable in the longer term. BBC Studios has ambitious plans to double its income and profits between 2021-22 and 2027-28, which, if achieved, will support it in providing increased returns to the BBC in the future.

However, to do so, BBC Studios must significantly grow the size and profitability of its digital services in a competitive market facing macro-economic challenges, and focus on generating new IP while continuing to exploit existing IP and brands. In parallel, the BBC must balance its immediate need for commercial dividends as licence fee income falls with ensuring that BBC Studios has sufficient cash available for investment.

Downloads

Publication details

Press release

View press release (20 Nov 2024)

Latest reports