Forecast: UK M&E sector worth £53bn in 2033
September 21, 2023
A report from Sky, in partnership with Public First and Oxford Economics, reveals that the UK’s media and entertainment sector could be worth £53 billion (€61.2bn) to the UK economy in 2033 if growth continues at its current trajectory, and with the support of the UK Government.
Sky plays a major role in the UK’s cultural economy and, in 2022 alone, supported a contribution of £20 billion to UK GDP, broadcast 70,000 hours of elite sports coverage and invested over £130 million to provide news to consumers free of charge.
Dana Strong, Group CEO at Sky, commented: “We face a unique opportunity for the UK to be a global powerhouse of creative production, scaling up to meet growing demand both at home and overseas. If our industry and the UK Government work together to invest in skills, innovation, and key infrastructure, we will succeed in creating more prosperity for communities across the country. As a result, the media and entertainment sector could be worth an impressive additional £10 billion to the UK economy by 2033. There’s so much more to do, and Sky is determined to be an engine for that growth – powering creativity in the UK and across the world.”
The research demonstrates the key role that original British content is already playing in the success of the UK creative industries, and how investment in better content, better tools, and better customer journeys, would further boost its value.
Sky’s research shows the sector could be worth an additional £10 billion to the UK by 2033 and could contribute an additional 40,000 jobs. In light of the findings, Sky is calling on government to take a more prominent role in the growth and development of the media and entertainment industry.
Sky is setting out five key policy priorities for success in the creative industries:
- Innovation: Sky proposes that all new regulation is subject to an Innovation Impact Assessment, requiring Government departments to explicitly consider the effect of new rules on companies’ ability to innovate.
- At present, one day a week of Sky’s technology resources are deployed on regulatory requirements, at significant cost to our business. This time and effort could be better placed elsewhere, such as developing new services or optimising existing business practices to boost productivity.
- Skills: Government should expand the scope of the Apprenticeship Levy so that it covers freelancers that move flexibly between productions and allowing funds to be used for broader retraining and retention.
- Incentives: Government should maintain a world-leading AV tax framework by committing to a regular benchmarking exercise assessing UK incentives against competing jurisdictions, as well as broadening R&D tax credits eligibility to include creative endeavours.
- Space: Government needs to proactively support production studio infrastructure by streamlining planning processes and rethinking the Valuation Office Agency’s property tax rating for studios.
- There are currently development proposals for 44 new studio spaces across the country, but progress is slow with ongoing funding and planning obstacles to overcome. Sky therefore encourages central government and local authorities to embrace the economic and employment potential of our screen sector, and streamline the planning processes that can bring this pipeline to fruition.
- Connectivity: Government should launch a national Internet Protocols (IP) roadmap in anticipation of a wholesale shift to IP distribution, including a coordinated effort to end digital exclusion to allow people to engage with online-only content.
Sky’s contribution
Sky’s new film and TV studio, Sky Studios Elstree, is projected to attract £3 billion of new production investment to the UK in its first five years and create up to 2,000 jobs.
Significant demand for British content
New research by Public First, highlighted that one in two UK adults are more likely to watch a TV show if it is set in the UK, with over two fifths (45 per cent) saying they particularly enjoy the British sense of humour and three in 10 (30 per cent) saying they like seeing British landmarks they recognise.
The report also uncovered the potential for export revenue, with international demand for British content set to grow by 50 per cent by 2033, as the UK continues to command a disproportionate share of the international market. The value of direct exports is also expected to deliver a boost of £2 billion for UK tourism, as overseas fans travel to see iconic locations from their favourite shows.