Celebrating 20 years of the Terms of Trade

Transforming the indie sector from a cottage industry into a global success story

Independent television production sector revenues grew by 150 per cent following the introduction of the Terms of Trade 20 years ago, a new report published by Pact reveals today.

The report, Celebrating 20 Years of the Terms of Trade was produced by Oliver & Ohlbaum to look at the effects of the Terms of Trade on the UK independent TV production sector.

The report examines how prior to the Communications Act 2003, UK PSBs accounted for over 90 per cent of commissioning, with indies being squeezed on budgets and rarely owning the IP in the programmes they created. Pact argued that by introducing Terms of Trade, indies would be able to retain the rights to their programmes, allowing them to generate additional revenue from their IP beyond their original commission, and put the revenue back into R&D to help grow their businesses.

Included in the Communications Act 2003, clause 285 introduced the Terms of Trade and effectively laid the foundations for the indie sector to transform from a cottage industry into the global multi-billion pound success story it is today.

Indies seized the opportunity given to them, establishing the UK as a hub for innovative ideas and taking UK content out into the world. This entrepreneurial spirit helped total revenues grow by 150 per cent and international revenues to soar, increasing by 649 per cent between 2004 and 2022.

And it is fitting that 20 years later, in the next major piece of communications legislation to be passed into law – the Media Bill – the Terms of Trade are to be amended, but this time to safeguard them for the future. The Bill sets out that in order for PSBs to meet their 25 per cent indie quota, commissioned programmes must have been subject to the Terms of Trade, even if their primary transmission isn’t intended to be on a linear PSB channel. This will mean a future consistent approach to terms and tariffs between indies and PSBs’ services.

Commenting on 20 years of the Terms of Trade, Pact CEO John McVay OBE said: “Looking ahead to the next 20 years, the sector will certainly face many more challenges. But UK indies have proven time and again that they have the creativity and chutzpah to adapt. With newly evolved Terms of Trade in place – maintaining that crucial foundation upon which so much success has been built over the past two decades – I’ve no doubt that our indies will continue to thrive both at home and on the global stage.”