British indies are punchy with power and they’ve got John McVay to thank. As chief executive of the London-based Producers Alliance for Cinema and Television, McVay helped broker the U.K. TV industry’s new Codes of Practice, which ensure producers the privilege of managing the secondary and ancillary rights of their programs. Fresh from that battle, which was won when OFCOM approved the Codes in January, McVay headed back to the negotiating table to hammer out Terms of Trade with the BBC and Channel 4. Nine months later he emerged with a few key victories, main among them the guarantee that producers will retain 85% of program revenues. In turn, commissioning broadcasters are entitled to 15% of the net revenues earned by a program’s other rights.
‘That allows producers something to trade with, to be more commercial with, and to be more entrepreneurial with,’ he says. ‘It’s real cash and real opportunity; something you can go to investors with, and that should bring other capital development funding – even production funding – into the British television program market. Previously, it was a 70/30 split the other way, with broadcasters and distributors taking all the expenses before we got a penny.’
McVay admits he made tough concessions: ‘There’s a logic to the terms of trade, which we worked really hard to keep hold of… In some cases that logic may not be as clear as when we set out, because we’ve had to accept a compromise.’ But, he contends pact got the majority of terms for which it was haggling, even that pesky 15% share to broadcasters.
‘We had many, many days of discussion about how we would or whether we should end up in a situation where a commissioning broadcaster should receive anything,’ explains McVay. The fate of the small indie ultimately guided the decision, as the set percentage eliminates the onerous need for case-by-case negotiations. ‘We wanted a clearer, simpler business negotiation for program supply in the U.K. for everyone, not just the biggest companies,’ he says.
At press time, McVay was going through the process once again with Five and ITV. Next, he’ll lead PACT in its lobby to reduce in-house program supply to 50%, down from its current level of 70% at ITV and BBC, he says. If that goes well, he’ll end up back at the negotiating table. ‘It’s a long and torturous and very interesting process,’ says McVay. ‘But, these things aren’t meant to be like going to a birthday party, are they?’