The UK's media landscape is undergoing significant changes with the latest development being ITV's decision to sell its media and entertainment business to Sky in a deal worth up to £1.6 billion.
The transaction involves a £1.2 billion cash payment alongside ITV Studios' £200 million acquisition of Sky's Love Productions, the company behind The Great British Bake Off. ITV also stands to receive an earn-out of up to £200 million if its advertising revenue reaches £1.7 billion next year, a figure broadly in line with last year's performance.
Under the terms of the agreement, ITV Studios will operate as a distinct global content business, underpinned by a long-term supply agreement with the combined ITV media and entertainment and Sky operation. This arrangement includes a minimum content spend commitment of £2.1 billion between 2028 and 2032, securing the future of the production house widely regarded as the jewel in ITV's portfolio.
Andrew Cosslett, ITV's chairman, stated that the deal will secure ITV's crucial role as a public service broadcaster, creating a UK champion with the scale and resources to better compete with global streaming platforms. The deal is expected to complete in the second half of next year, with around £950 million returned to shareholders.
Crucially for viewers, ITV and ITVX will remain free-to-air and will continue to carry fan favourites including Coronation Street, Emmerdale, and Love Island. Under the ten-year public service broadcasting licences renewed by Ofcom, ITV is required by law to provide a free-to-air service until at least the end of 2034.
The tie-up marks the latest reshaping of the UK media landscape under sustained pressure from global streaming. Sky, which provides television, streaming, broadband, and mobile services to millions of customers across the UK and Europe, is owned by a US media conglomerate that plans to spin off Sky and NBCUniversal into a standalone, publicly listed media company.
The consolidation among the big commercial broadcasters could further simplify access to premium television advertising, building on moves such as a platform that lets small firms buy ITV, Sky, and Channel 4 airtime in minutes. Dana Strong, Sky's chief executive, described the agreement as a "defining moment" for British media, with a combination of this size once having faced formidable regulatory hurdles but now necessary due to the rise of global streaming services.
