To start a new section, hold down the apple+shift keys and click to release this object and type the section title in the box below. Foreword Deloitte’s Media Metrics identifies and ranks the UK’s top 100 media and entertainment companies by scale. It is the definitive media power list for the UK today. We have analysed audited data on the 100 largest media and entertainment companies in the UK. Collectively they generate £87bn in annual revenue. We project they will break the £100bn level within the next five years. This is a transformative period for the media and entertainment industry. In a year when the fundamental purpose of the BBC was challenged, when physical book sales in the UK actually rose against expectations, when the Independent became the first national newspaper to move completely online, and when half of the world’s top 10 ten best-selling music artists were from the UK, we can see waves of change washing over many different media and entertainment sectors. Against this backdrop, Media Metrics provides a new and comprehensive view on the size and shape of the media and entertainment market today and the role of the UK as a home for the creative sector. In short, the industry is growing, both in size and in profitability. Over the last three years the total revenue of the top 100 companies has grown by 6 per cent annually, while total profit has more than doubled since 2011 to break the £10bn mark in the last year. With bottom line growth faster than top-line overall, who is making the right strategic choices to drive this performance? Information publishing is one buoyant area of the industry, accounting for four of the top ten companies by profit. But, in pure revenue terms, it is the advertising and television sub-sectors that dominate. A fifth of the companies in our top 100 ranking are from the advertising sector, while television accounts for 40 per cent of revenue for the top 100. Far from being dead, television is the cornerstone of UK media and entertainment. Revenue generation is dominated by a handful of companies. The ten largest earn over two-thirds (68 per cent) of total industry revenue. With such concentration, is there a risk to the industry’s plurality of voice? The top 100 media companies are all choosing, or have been obliged to take, different paths. Some have focused on a single market or business line, others are diversifying into a wide array of products and market segments. Some are expanding abroad, others are driving growth at home in the UK. This report seeks to identify the link between these strategic options and company performance, in terms of headline revenue and profitability. With nearly a fifth of the largest 100 media and entertainment companies currently unprofitable, the asymmetries between companies that are pursuing top line growth and those that are focused on bottom line profitability are more pertinent than ever. Dan Ison Paul Lee Partner, UK Media & Entertainment Sector Leader Partner, Head of Global TMT Research Deloitte Deloitte LLP Media Metrics The state of UK media and entertainment 1