Celebrating 20 years of the Terms of Trade

It’s been 20 years since UK broadcasters and independent producers struck their original Terms of Trade deal. And what a success it has proved to be – who’d have thought back in 2003 that things would have turned out so well.

Despite giving Ofcom backstop powers, these have never had to be used either for the 2004 Terms or for the subsequent modifications which have been required to deal with the growth of on-demand and IP-delivered TV in the last two decades.

In fact, the Terms of Trade have proved to be one of the most successful interventions in recent history. The advantage they have given the UK’s production sector has made it the envy of international competitors, with others seeking to emulate a rights retention framework. The Terms have facilitated the creation of the world’s most dynamic TV production sector with levels of investment from the UK and overseas continuing to grow, while expanding UK television content exports of finished programmes, formats and IP. Quite an achievement particularly as when the Terms were originally mooted, many public service broadcasters (PSBs) broadcasters considered this an unwelcome intervention.

In reality the Terms introduced many benefits not least in containing the net costs for commissioners by maximising returns from UK secondary market, overseas sales and investor funds which offset programme budgets. In addition, the PSBs were able to attract investment to grow their own production activities – reducing their dependence on the home market.

So, the UK production sector remains vibrant. As one indie gets acquired by a larger global group, another two or three start-up indies enter the market and many of these are based outside of London and the South East of England.  

Basking a little in this reflected glory, Oliver & Ohlbaum can say that it has been there for the duration – firstly advising Number 10 and the ITC (as it was, now Ofcom) on the need for the original intervention and then with our brilliant colleagues at PACT, helping them with the negotiations, subsequent modifications for on-demand TV and the four significant reviews of the Terms in the last 20 years.  

As the media and entertainment sector navigates challenging times, the nature and evident success of the Terms of Trade could provide some useful lessons for the way the UK regulates the future of the internet, AI, social media and even, dare we say it, football. A code of conduct with backstop regulatory powers designed to encourage investment, innovation and growth might be just what we need.