Media Metrics 2016 - The State Of UK Media And Entertainment 2016

Combined revenue for the top 100 UK media companies is more than £87bn, up 21% from 2011.

We've identified the top 100 UK media companies and examined their performance to provide a snapshot of the UK media market today.

Overview

Combined revenue for the top 100 UK media companies is more than £87bn, up 21% from 2011 TV on the right channel: television is the largest sub-sector in UK M&E, comprising 40% of revenue in the top 100; Content still king: content-creators are more than seven times more profitable than those that focus on distributing content, proving that IP drives margin; Our new report, Media Metrics 2016, evaluates the five-year financial performance of the largest UK media organisations, highlighting the main trends and issues facing the industry in 2016 and beyond.

The research found that the media sector in the UK is thriving, the top 100 media companies have a combined revenue of £87bn. TV production and distribution is the largest sector in the UK media industry, with 19 of the top 100 organisations and a combined revenue of over £34bn. However, as our Top 100 listing reveals, profitability is hard to come by in the online era with nearly a fifth of the largest 100 media and entertainment companies currently unprofitable.

Our key findings

What's the value of the end-to-end trend?

Our research illustrates the value of content in today's media and entertainment market: distribution-only companies in our ranking have an average profit margin of just over 1%. By contrast, content creators generate average margins of 9%. Those with both have a margin of 13%, suggesting that distributors should consider investing in content if they want to boost profitability.

Developing a primary distribution channel can be an attractive option to connect with a loyal paying customer base but companies should recognise that customers are often only willing to engage in direct paying relationships with the largest and most trusted content brands.

Diversify for revenue, focus for profit

The leading media and entertainment companies in the UK are a diverse bunch. The majority of the top ten have business interests outside their 'core' media market. In contrast, the ten most profitable generate almost all of their revenue from one core market.

Decisions to invest and diversify should be balanced by a desire for profitability and an awareness of shareholder demands regarding stable, low risk returns versus maximising profit.

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