The future of British television is under serious threat, according to BBC director general Tony Hall.
"The UK is sleepwalking towards a serious, long term weakening of its TV production industry," said Hall, in front of a DCMS committee in Westminster on Tuesday November 7th .
Hall proposed the idea of a new, paid-for on-demand service featuring BBC programming, following the closure of the BBC Store after only 18 months.
The appetite for video on demand (VOD) and other third-party platforms is growing in the UK and abroad, in what is a rapidly changing TV market.
In 2016, the BBC Worldwide-owned commercial broadcaster UKTV, which has been built on BBC programming, generated profits of £91m. For Hall, that is a model to emulate. "We need to look at UKTV to see how our back catalogue could be extended into an on-demand service," he added.
Hall has predicted a fall in spend of around £500m over the next 10 years, which would drastically reduce the amount and quality of the country's favorite shows.
Sky's Gary Davey disagrees. Writing in the Daily Telegraph, the Sky content boss said the claims were "bizarre", adding "“the golden age of television is just getting started"
The Subscription Video on Demand (SVoD) proposal by the director general is an effort to play a more significant role in offering archive content and give consumers the complete BBC experience.
A decade ago, around 83% of independent production companies in Britain were either European or UK owned. That figure today is around 40%, with the majority now owned by US multinationals.
This highlights the growth of SVoD global giants such as Netflix and Amazon and may explain the lack of increased investment in British content.
The BBC has an annual content budget of £3.5bn, playing an important role in nurturing talent and investing in high quality British content.
Hall suggests they continue to back new ideas and take creative risks in order to compete with US giants. "We have to realise that the environment around the BBC has changed dramatically and we must change in response," argued Hall.