‘Scale is survival’: UK broadcasters race to merge as streaming giants squeeze revenues
British broadcasters are turning to mergers as television revenues come under pressure from streaming services, YouTube and online ads, according to Ofcom.
The media regulator’s annual Media Nations report found commercial broadcaster revenues fell from £4.98bn to £4.83bn in 2025, despite the wider TV and online video market growing seven per cent to £18.4bn.
Growth came from online video rather than traditional broadcasting as ad spending continued to shift online.
The findings come weeks after Sky agreed a £1.6bn takeover of ITV’s media and entertainment business, a deal that would create Britain’s largest commercial broadcaster.
Overseas, Paramount is pursuing a $111bn (£83.41bn) acquisition of Warner Bros. Discovery, while Banijay and All3media have completed a merger to create one of the world’s largest TV production companies.
Ofcom said audiences are now as likely to turn to Netflix as the BBC when deciding what to watch. Around 26 per cent of viewers said Netflix was their first choice, compared with 25 per cent for the BBC and 15 per cent for ITV.
Meanwhile, traditional broadcasters are retaining audiences through their own streaming platforms.
Viewing of BBC iPlayer, ITVX, Channel 4 Streaming and 5 increased nine per cent over the year, making broadcaster-owned services the fastest-growing television category.
Even so, that growth was not enough to offset the continued decline in linear television viewing. Overall broadcaster viewing fell eight per cent, while subscription streaming remained in around seven in ten UK households.
Youtube is also taking a growing share of television viewing. Average viewing on TV sets has more than doubled since 2022 to 19 minutes a day, while viewing across all devices has risen to 41 minutes a day.
Broadcasters have responded by expanding the amount of full-length content they distribute on the platform.
Paolo Pescatore, founder of PP Foresight, said broadcasters were responding to long-term changes in the market.
“The biggest competitors are no longer other broadcasters,” he told City PM. “They’re competing against Netflix, YouTube, Amazon and the global technology platforms. Greater scale allows broadcasters to spread costs, invest more in technology and content, and strengthen their position with advertisers.”
He said broadcasters also needed larger streaming businesses as audiences increasingly expected to watch content whenever and wherever they wanted, rather than through scheduled TV alone.
Competitive ad market
The report also shows why advertising is expected to be central to the CMA’s review of Sky’s proposed ITV takeover.
City PM revealed last week that Sky and ITV are expected to argue the combined company accounts for around 20 per cent of the UK’s ad market once social media and digital advertising are included.
Under a TV-only definition, the combined business would control around 70 per cent of the market.
Ofcom’s figures suggest advertising continues to move away from traditional television.
TV advertising revenue fell one per cent to £5.2bn in 2025, while online advertising increased nine per cent to £39.3bn. Social media advertising grew 21 per cent to £11.5bn.
“The market has changed fundamentally. These companies are no longer just competing with each other”, Pescatore said. “They’re competing for viewers, advertising and subscription revenue against businesses operating on a global scale.”
Despite the pressure, Ofcom said public service broadcasters remain the biggest investors in UK-made programming, producing more than 30,000 hours of original content last year.
Major live events also continue to attract large audiences, with England’s World Cup semi-final drawing a peak audience of 24 million viewers across BBC platforms.