麻豆社

The 麻豆社 Trust has today  based on the findings of an independent review of the 麻豆社's role in the UK's market for on-air and on-screen talent.

The independent report, by Oliver and Ohlbaum Associates Ltd (O&O), finds that:

There is no evidence that the 麻豆社 is paying more than the "market price" for leading TV talent when it finds itself competing with rivals to secure their services. In some cases, it may well be paying less than the market price for that talent.

There is no evidence that the 麻豆社 is systematically pushing up prices in the talent market. Where high rates of inflation do currently seem to exist in the 麻豆社 this is largely due to market forces at work in the rapidly changing UK TV and radio markets.

The 麻豆社 has a number of systems in place to ensure that it achieves value for money in its negotiation of talent fees, and has strengthened these processes in recent years.

However, O&O's findings also suggest there is room for improvement in the 麻豆社's practices which when implemented could achieve better value for licence fee payers in some of its deals with talent.

Chairman of the 麻豆社 Trust, Sir Michael Lyons said:

"The report shows the 麻豆社 is not negatively distorting the UK's market for talent on television and that overall it is achieving deals which represent value for money. We will keep the pressure up to ensure the best deals are reached for licence fee payers and will review progress in 12 months' time."

In 2006/7, the 麻豆社 made an investment of around £242m in on screen and on air talent (including independent commissioning in TV and Radio) which represented around 5.6% of its total licence fee expenditure. The vast majority of its 200,000 talent contract payments were for less than £1000.

Following the implementation of new controls by the 麻豆社, the inflation rate in talent fees per hour for top TV talent has almost halved from levels during the period 2000/01 to 2003/04. All 麻豆社 talent spend on television and radio programmes – including those from independent producers – is estimated to have grown by approximately 6% each year over the last three years.

Judgements are more complex in some areas where there are fewer direct comparisons, for example in some parts of network radio. To help reach a clearer outcome, 麻豆社 Management are already drawing on O&O's findings and recommendations as part of their strategic talent review and the Trust will report progress report in 2009.

On the value of talent to audiences, Sir Michael said:

"Our conclusions reflect the importance of talent to audiences and the contribution they make to the distinctiveness of programmes: they are often what make audiences tune in and turn on. Indeed, the value of great entertainers, comedians, actors, presenters, journalists and interviewers is rightly very high and the 麻豆社 has a special responsibility because of its unique funding to help develop the UK's talent base for the benefit of the industry as a whole."

The increasing competition for talent in recent years amongst commercial television broadcasters is acknowledged in the findings as the main factor in increasing talent costs. However, although the 麻豆社 must not put at risk its ability to attract the best talent to be enjoyed and valued by licence fee payers, the 麻豆社 does not face the same commercial pressures as its competitors. Its secure funding brings with it a duty to take creative risks and develop new talent and programme formats so it is not overly reliant on the established names that others rightly compete for.

Sir Michael added:

"The 麻豆社 has to be prepared to walk away from deals that do not offer good value to the audience and to equip itself to do this by continually bringing on new talent and through good succession planning."

The Trust is clear that the 麻豆社 can do more to achieve value for money by improving some of its processes, and in particular by a more consistent and systematic approach to gathering independent data and subjecting deals to more rigorous challenge. Likewise, a more systematic approach could be applied to using the 麻豆社's bargaining power in respect of levels of exposure that can be offered to talent by the 麻豆社.

In conclusion, Sir Michael said:

"I do understand that many people will continue to question the salaries paid to some 麻豆社 performers. These high payments can be particularly difficult to accept when wages elsewhere (including in other parts of the 麻豆社) are under pressure. I hope that, because the Trust has had a good look at this I can at least give licence fee payers some assurance that the 麻豆社 is working hard to meet its obligations both to deliver quality and to keep the cost of its talent under control."

The Trust Unit will carry out a short review of progress 12 months from now and this further report will be published.

Notes for editors

The full report, including the Trust's conclusions and the 麻豆社 Executive's response to the O&O findings is available at: Review of talent costs

The Trust's progress review in 2009 will focus on ensuring that improvements in value for money on overall talent costs continue to be made, and that the 麻豆社's systems and processes for assessing the market are thorough and based on up-to-date information. The Trust will also focus its review on assessing how a pool of the best new talent is successfully being encouraged and utilised, and how the 麻豆社's wider talent strategy will develop and strengthen the 麻豆社's commitment to licence fee payers to deliver distinctive content through the best use of big name talent and fresh new names across TV, Radio and Online.

Sir Michael Lyons announced the Trust's decision to review talent costs in June 2007. Terms of reference were published by the Trust in November 2007 and are available at:

Terms of reference

The cost of this review of talent costs, including bespoke research, was £165,000.