Why are the BBC and ITV creating BritBox?

A screenshot of the BritBox website Image copyright BritBox/PA

Two inescapable trends are driving the TV business around the world today - one in consumer behaviour, the other in business strategy.

The first is exponential growth in streaming, with an accompanied decline in scheduled TV.

The second is consolidation among content providers who are desperately seeking scale. BritBox is a marriage of the two.

For the BBC, the iPlayer is still a small part of overall viewing, but the key growth area, especially among the younger audiences who much prefer other digital platforms, particularly YouTube.

BritBox will sit alongside the BBC's iPlayer growth strategy. This makes sense, because digital delivery of content is not a zero-sum game: BritBox growth will not be at the cost of iPlayer growth, and vice versa.

ITV faces a hugely different set of challenges. It is a mostly ad-funded, linear channel - the opposite of Netflix, a subscriber-driven, streaming service. Carolyn McCall, its CEO, says TV advertising is holding up reasonably, despite the uncertainty caused by Brexit.

Clubbing together

It is an imperative for her, and ITV, that the broadcaster develops a digital offering that reduces reliance on advertising and gathers data on the viewing habits of consumers. ITV Player has done a bit of this. BritBox will supercharge it.

Clubbing together to offer the maximum amount of content allows the BBC and ITV to provide a better service than they could alone, at a time when other media giants, such as Disney, are pulling out of Netflix to launch their own direct-to-consumer offerings.

The sticking point in negotiations until now has always been how to build technology that reconciles the commercial imperatives of ad-funded ITV with the licence fee-funded BBC - and how the BBC's vast ambitions for the iPlayer sit alongside this new venture.

Given the urgency of the BBC and ITV's need to capture the eyeballs of a distracted generation, BritBox is a small but significant new entrant to the video-on-demand business.

Related Topics

More on this story