Comcast-owned Sky will acquire ITV’s media and entertainment divisions in a £1.6 billion deal. ITV’s broadcast channels and the ITVX streaming service will remain free-to-air.
Negotiations started back in November and this is what the two companies agreed on. Sky will pay ITV £1.2 billion in cash and it will transfer Love Productions (which makes The Great British Bake Off among other things). Additionally, Sky will pay £200 million to ITV in 2028, though that is dependent on meeting advertising revenue goals.
This acquisition does not include ITV’s studio arm. That said, as part of this deal, Sky will spend £2.1 billion on content from ITV Studios over a 5-year span.
ITV is the biggest commercial broadcaster in the UK – it boasts 40 million weekly viewers and 16.5 million monthly digital users. After they get added to Sky’s numbers, the combined media company will account for around 20% of the UK’s in-home viewing.
Last year, YouTube became the UK’s second most-watched media service. Gen Alpha turns to YouTube first, but it’s not just young people – the BBC reported that even people over the age of 55 watch twice as much YouTube as they did a couple of years ago.
With this move, however, the combined Sky+ITV viewership will pip YouTube and take the second place position (BBC is on top). And YouTube has traditional media companies spooked. From the press release:
“The UK media market is undergoing a profound and rapid transformation, and as competition for audiences intensifies, scale matters more than ever in order to compete with global streaming giants and YouTube in the UK.”