This article was first published in the June 2016 UK edition of Accounting and Business magazine.

Since the first ‘tube’ appeared in the UK in the 1930s, television has become a huge part of our lives. It is also big business for producers and distributors of popular programmes, generating £2.9bn in revenue in 2014 in the UK alone. But the past 10 years have seen an upheaval in the sector as viewing habits and technology change.

TV production is one of the most active UK industries in terms of consolidation, acquisition and the rate of new entrants. According to a 2015 review of the sector by industry watchdog Ofcom, there were 500 independent TV producers with revenue of less than £10m a year in the UK in 2001, but just 230 by 2014. Every year since 2009 has seen new entrants to the market, accounting for 30% of all production companies. And seven of the 10 largest TV producers in the UK have foreign owners – the buying-up of independent producers by large multinational media companies is one of the most significant industry trends identified by Ofcom.

The ‘super indies’ (as the top 10 independents are known in the industry) tend to be structured as several distinct production companies within a group. Warner Brothers Television Production UK (WBTVPUK) is a classic example. Originally established in 1998 as Shed Productions, it grew through a series of acquisitions of other independent producers, and floated on AIM in 2005 as Shed Media Group. In 2010 Warner Brothers, part of the giant US media group Time Warner, bought a controlling interest in a deal that valued the company at £100m, steadily increasing its stake until it was fully owned (and renamed) in June 2014.

Boutique feel

But while owners do not get much bigger than Time Warner, WBTVPUK still feels – to a visitor, at least – very much like an independent outfit. As finance director Sharon Barker explains, the group’s six distinct production companies (Wall to Wall, Twenty Twenty, Renegade, Headstrong, Yalli and Ricochet) all have a slightly different focus and feel.

Wall To Wall produces the The Voice UK and Who Do You Think You Are? as well as ‘living history’ documentaries and an Academy Award-winning film, Man on Wire. Twenty Twenty produces First Dates as well as several series featuring the choir master Gareth Malone. Renegade is responsible for factual series and one-off programmes such as The Tribe, Don’t Tell The Bride and The Town That Took on the Taxman. Headstrong concentrates on drama and produced New Tricks and Waterloo Road, while Yalli Productions, one of the newest in the group, concentrates on comedy, including Impractical Jokers. While these five companies are all based in London, the sixth, Ricochet, is based in Brighton and produced Supernanny.

‘Each of the companies has its own niche, its own creatives and its own talent. And each is aiming for different slots so they generally won’t compete with each other,’ says Barker. ‘When you’re owned by a large company you have to hit the right balance to allow the identity of the individual companies to remain. Each is its own entity and you don’t want to stifle them. The conversations I have with the company MDs are very different from the conversations I have within the wider WB group.’

The setup, along with the complexities of an involved US owner that reports in dollars and under US GAAP, makes the life of the 29-strong finance team a challenge, to say the least. It suits Barker down to the ground. She says: ‘I like to get stuck in and I’ve really had to here. We’ve seen a lot of change since I joined.’

When she joined the group in November 2012 Time Warner owned 51% of the company. ‘Shed Media had gone through a lot of acquisitions by then and each company had its own way of doing things,’ she says. ‘A lot of restructuring and streamlining was needed, and we implemented SAP and systems upgrades. 

‘At the same time Shed Media was going through its earn-out [to become 100% owned by Warner Bros]. It was a lot of work, with long hours. For three years, things were forever changing. And the fact that we were US-owned meant that what the American owners needed in terms of information was very different from what was used internally, which was a struggle. We spent a lot of time on reporting, making sure that the owners and the managing directors of the individual companies had all the information they needed.’

While transaction services and financial planning and analysis are centralised, each of the six production companies has its own financial controller, management accountant and production accountants, all reporting to Barker. She in turn reports to the group CFO, who has a strategic role.

‘A lot of my time is spent on problem-solving and team management,’ she says. ‘The amount of change, both within the organisation and within the industry itself, has been a big challenge for us. Change is emotive for the people who work here, and you have to remember that.’

TV characters

Barker says that the single most important skill for finance professionals working in media is personality: ‘Your personality has to fit. When I’m recruiting, it’s very important to me.’ 

While she has worked for media companies for 17 years – including for Ascent Media and three years at ITV – top of her wish-list when looking for a new job has been an environment that suits her, rather than a driving need to work in media or television. ‘I always said when I was looking for a job that it doesn’t have to be in media, but I was looking for a more informal, relaxed environment with interesting people and challenges. 

‘The best thing about this job is the people; they’re very creative and inspiring. When I’m sitting in the office I’ve had people researching programmes around me, and you do hear some amazing conversations.’

The uncertainty in the sector continues. The BBC is negotiating its charter renewal and the prospect of privatisation hangs over Channel 4, both of which could affect the way programmes are commissioned. Changing viewing habits are also causing producers to rethink their approach. ‘We’re already developing spin-offs from our series and shorter clips through YouTube, for example,’ says Barker. 

The next big hit

The pressure for WBTVPUK, as for any other production company, is finding the next big hit. ‘You never know what that will be. First Dates has done exceptionally well at home and overseas, but it took a couple of series to take off. We’re constantly thinking about what the next thing will be.’ In a way, she adds, ‘it’s quite comforting not having to worry about that and only being responsible for the finance’.

Liz Fisher, journalist