Paramount, through its Channel 5 British network, has seen lower profits and sales, but they are still going big on local content spending. Our Blake & Wang P.A. entertainment attorney, Brandon Blake, walks us through their reasoning.
First Earnings Since Merger
This is the first earnings announcement for Channel 5 since the Skydance-Paramount merger finally closed earlier this year. In 2024, Channel 5 brought in £21M, down 81% from 2023’s £112.4M. However, it must also be noted that redressing an accidental underpayment to ad partners did eat up a chunk of this year’s profits.
When that payment is taken out of the mix, it does look a lot brighter. 2024 saw an operating profit of £12M in 2024, compared to £22.7M in 2023. Revenue was down by only 1% at £314M. The broadcaster has managed to make a profit in 9 of the past 10 years, with the pandemic-ridden 2020 the only exception.
High Content Spending
Paramount has always seen Channel 5, and its streaming arm, 5, as an important part of its UK market presence. 5 is, in fact, one of the fastest-growing streamers among UK public broadcasters. However, there may be changes coming. Their content spending hit a 3-year high (£216.6M), whereas most other competing channels have slowed down considerably.
With Paramount finally able to focus on its profitability and restructuring under the Skydance deal, the sustainability of those levels of spending may be in question. We have seen a general trend of streaming services looking to cut excessive content spending as each service aims for profitability, so whether they will rein in that spending is certainly a core question.
However, the news around Channel 5 has been generally positive, and Paramount seems committed to keeping it healthy for the sake of their UK market. It is likely we will see further changes coming for the service soon.
Film and Television 