Darren Childs linked with football and rugby union roles while BBC plans deal
The chief executive of UKTV, which owns channels including Dave and Gold, is quitting before a £1bn breakup of the broadcaster.
Darren Childs, who has driven ratings and seen profits surge from £29m to more than £90m in the past eight years, will leave on 1 July and is already being touted as a potential candidate for the chief executive vacancy at the Premier League and commercial chief of Premiership Rugby.
His departure comes as the BBC is poised to seal the biggest media deal in the corporation’s history. The corporation’s next board meeting is expected to give final approval for a deal to take control of the bulk of UKTV, which broadcasts 10 free-to-air and pay-TV channels, including a one-off payment of as much as £250m.
UKTV is currently jointly owned by BBC Studios, the corporation’s commercial arm, and the Eurosport owner, Discovery. The deal, which sources say is hoped will be completed by April, will result in the BBC taking control of as many as seven of the channels. With UKTV valued at as much as £1bn, the BBC does not have the financial firepower for a straight buyout of Discovery and so has agreed sweeteners to make up the value.
On top of the cash payment, these include giving Discovery the video-on-demand rights to prime natural history content, such as Blue Planet, for streaming in international markets as well as a small TV co-production deal. Discovery is expected to take control of UKTV’s lifestyle channels, Good Food, Home and Really.
The deal is the biggest in the corporation’s history – well in excess of last decade’s ill-fated £130m Lonely Planet purchase and the £150m sale of half of BBC America in 2014 – and comes at a politically sensitive time.
The BBC has warned of potential channel closures and enormous cuts to services (While it’s trying to buy this) if it is forced to take on the full £745m cost of paying the licence fee for over-75s when the government stops funding it.
The BBC has been approached in the past about selling its stake in UKTV, worth at least £500m, but instead has decided to spend big to take control of the hugely profitable business.
UKTV’s profits have rocketed from £29m to more than £90m in the past eight years. It also pays £54m a year to BBC Studios for the rights to an extensive library of BBC shows from Top Gear to Dad’s Army.
The deal could also help pave the way for a breakthrough in talks to launch a streaming service joint venture with ITV, a “best of British” rival to Netflix and Amazon.
Carolyn McCall, the chief executive of ITV, is to give detail on its plans for a service when the broadcaster’s annual results are revealed on 27 February and is understood to be keen to be able to announce a breakthrough in the protracted talks with the BBC.
The talks have been hindered in part by the uncertainty around the complicated video-on-demand rights deals the BBC has in place with UKTV and others, including Netflix.
Last year Virgin Media took UKTV’s channels off air, accusing the BBC of being a “linear dinosaur in an on-demand world” for holding back and splitting digital rights.
A breakup of UKTV could also have major long-term ramifications for Channel 4, which handles the broadcaster’s £250m-per-year TV ad sales contract. UKTV’s success in growing viewers in recent years has made it immensely important for Channel 4 to be able to secure good deals across all the channels it sells ads on, including its own.
While Channel 4 has a long-term contract in place with UKTV, it is not clear whether the Discovery deal could change that. Discovery uses Sky’s sales force to sell TV advertising across its channel portfolio.