The British media and entertainment sector could be worth £53.0 billion ($65.5 billion) by 2033, up from £43.0 billion ($53.1 billion) in 2021, potentially bringing an additional £10 billion ($12.4 billion) to the U.K. economy, Comcast-owned European media and technology giant Sky said on Wednesday, unveiling a new report that also urged political leaders in the country to help companies capture the growth opportunities.
The industry giant called on the U.K. government to “unleash the creative industry’s potential” by implementing five key policy priorities, some of which were outlined by Sky group CEO Dana Strong during an appearance at the Royal Television Society (RTS) Cambridge Convention. Among them is proactive support of the development of the country’s studio infrastructure by streamlining planning processes for new facilities, a reduction in costly red tape, and a regular review of tax incentives.
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“We face a unique opportunity for the U.K. to be a global powerhouse of creative production, scaling up to meet growing demand both at home and overseas,” she said. “If our industry and the U.K. government work together to invest in skills, innovation, and key infrastructure, we will succeed in creating more prosperity for communities across the country.” She added: “There’s so much more to do, and Sky is determined to be an engine for that growth – powering creativity in the U.K. and across the world.”
The new industry report from Sky, in partnership with Public First and Oxford Economics, presented on Wednesday, emphasized that “the U.K.’s media and entertainment sector could be worth £53 billion to the U.K. economy in 2033 if growth continues at its current trajectory and with the support of the U.K. government.” It could also contribute an additional 40,000 jobs over that period.
Sky also highlighted its “major role in the U.K.’s cultural economy.” In 2022 alone, it supported a contribution of £20.0 billion ($24.7 billion) to U.K. GDP, “broadcast 70,000 hours of elite sports coverage and invested over £130 million ($161 million) to provide news to consumers free of charge,” the company said. Sky’s new film and TV studio Sky Studios Elstree is projected to attract £3.0 billion ($3.7 billion) of new production investment to the U.K. in its first five years and create up to 2,000 jobs, the company also noted.
“The research demonstrates the important role that original British content is already playing in the success of the U.K. creative industries, and how investment in better content, better tools, and better customer journeys, would further boost its value,” Sky emphasized. For example, one in two U.K. adults were found to be more likely to watch a TV show if it is set in the U.K., with 45 percent saying they particularly enjoy the British sense of humor and 30 percent saying they like seeing British landmarks they recognize.
The report also predicts that international demand for British content is set to grow by 50 percent by 2033, “as the U.K. continues to command a disproportionate share of the international market,” Sky noted. “The value of direct exports is also expected to deliver a boost of £2.0 billion ($2.5 billion) for U.K. tourism, as overseas fans travel to see iconic locations from their favorite shows.”
In light of the findings, the company called on the government “to take a more prominent role in the growth and development of the media and entertainment industry,” setting out five key policy priorities for success. Below is a closer look at Sky’s five policy proposals.
“Sky proposes that all new regulation is subject to an Innovation Impact Assessment, requiring government departments to explicitly consider the effect of new rules on companies’ ability to innovate,” the company said. “At present, one day a week of Sky’s technology resources are deployed on regulatory requirements, at significant cost to our business. This time and effort could be better placed elsewhere, such as developing new services or optimizing existing business practices to boost productivity.”
Sky urged the U.K. government to expand the scope of the so-called Apprenticeship Levy so that it covers freelancers who move flexibly between productions and to allow “funds to be used for broader retraining and retention.”
Sky said it wants the government to “maintain a world-leading audio-visual tax framework by committing to a regular benchmarking exercise assessing U.K. incentives against competing jurisdictions, as well as broadening research and development (R&D) tax credits eligibility to include creative endeavors.”
The government “needs to proactively support production studio infrastructure by streamlining planning processes and rethinking the Valuation Office Agency’s property tax rating for studios,” Sky argued. “There are currently development proposals for 44 new studio spaces across the country, but progress is slow with ongoing funding and planning obstacles to overcome.” Sky encouraged the U.K. government and local authorities to “embrace the economic and employment potential of our screen sector and streamline the planning processes that can bring this pipeline to fruition.”
Sky also called on the U.K. government to launch a national Internet Protocols (IP) roadmap “in anticipation of a wholesale shift to IP distribution, including a coordinated effort to end digital exclusion to allow people to engage with online-only content.”
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