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Television Production in Transition:

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Media Policy and Business) Gillian
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PALGRAVE GLOBAL MEDIA POLICY
AND BUSINESS

Television
Production in
Transition
Independence, Scale, Sustainability
and the Digital Challenge

Gillian Doyle · Richard Paterson


Kenny Barr
Palgrave Global Media Policy and Business

Series Editors
Petros Iosifidis, Department of Sociology, City University,
London, UK
Jeanette Steemers, Culture, Media & Creative Industries,
King’s College London, London, UK
Gerald Sussman, Urban Studies & Planning, Portland State
University, Portland, OR, USA
Terry Flew, Creative Industries Faculty, Queensland
University of Technology, Brisbane, QLD, Australia
The Palgrave Global Media Policy and Business Series has published to
date (2017) 15 volumes since its launch in 2012. Concentrating on the
social, cultural, political, political-economic, institutional, and technolog-
ical changes arising from the globalisation of media and communications
industries, the series considers the impact of these changes on matters of
business practice, regulation and policy, and social outcomes. The policy
side encompasses the challenge of conceiving policy-making as a reitera-
tive process that recurrently addresses such key challenges as inclusiveness,
participation, industrial-labour relations, universal access and freedom
in an increasingly globalized and transnationalized world. The business
side encompasses a political economy approach that looks at the power
of transnational corporations in specific contexts—and the controversies
associated with these global conglomerates. The business side considers
as well the emergence of small and medium media enterprises.
Focusing on issues of media convergence, industry concentration, and
new communications practices, the series analyses the tensions between
systems based on national decision-making and publicly-oriented partici-
patory structures and a more global perspective demarcated by commer-
cialization, privatization and monopolization.
Based on a multi-disciplinary approach, the series tackles three key
questions:
• To what extent do new media developments require changes in
regulatory philosophy and objectives?
• To what extent do new technologies and changing media consump-
tion require changes in business practices and models?
• And to what extent do privatisation, globalisation, and commerciali-
sation alter the creative freedom, cultural and political diversity, and public
accountability of media enterprises?

More information about this series at


http://www.palgrave.com/gp/series/14699
Gillian Doyle · Richard Paterson · Kenny Barr

Television Production
in Transition
Independence, Scale, Sustainability and the Digital
Challenge
Gillian Doyle Richard Paterson
CCPR CCPR
University of Glasgow University of Glasgow
Glasgow, UK Glasgow, UK

Kenny Barr
CCPR
University of Glasgow
Glasgow, UK

ISSN 2634-6192 ISSN 2634-6206 (electronic)


Palgrave Global Media Policy and Business
ISBN 978-3-030-63214-4 ISBN 978-3-030-63215-1 (eBook)
https://doi.org/10.1007/978-3-030-63215-1

© The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer
Nature Switzerland AG 2021
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Cover design by Spi

This Palgrave Macmillan imprint is published by the registered company Springer Nature
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The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland
Preface

This book is based on findings from a research project entitled Television


Production in Transition: Independence Scale and Sustainability which
was led by Professor Gillian Doyle (Principal Investigator) and conducted
by her and a team comprising Co-Investigator Richard Paterson, former
Head of Research and Scholarship at the British Film Institute, and
Research Associates Dr. Kenny Barr and Dr. Michael O’Neill, all based at
the Centre for Cultural Policy Research at the University of Glasgow. We
gratefully acknowledge the support of the Economic & Social Research
Council (Reference ES/N015258/1). The broad objectives of our study,
which ran from April 2017 until October 2020, were to investigate the
implications of recent restructurings in ownership that have swept across
the UK and international television production industry.
Recent transformations in ownership of television production, char-
acterised by increasing consolidation, have raised concerns about the
ability of ‘independent’ production to survive and flourish in an increas-
ingly globalised and competitive environment for television. Our project
investigated the relationship between independence, scale and economic
sustainability in the UK television production sector. In addition, we
conducted extensive empirical research into the effects of recent changes
in ownership on creative decision-making and content. We also analysed
the implications of our findings for public policy.
Our study centred on the experience of a carefully selected sample
of UK-based television production companies as case studies. While our

v
vi PREFACE

focus was mainly on ownership and on understanding how the economic


performance and content of production companies is affected by differing
sorts of corporate ownership configuration, it should be acknowledged
that factors other than ownership can and do shape how production
companies fare and what content they make. The scope of our research,
while confined in terms of focus, geography and time, has enabled us to
create a unique and ground-breaking analysis of transformations that are
widely affecting the television production industry worldwide. Even so,
as the television landscape evolves and as globalised platforms continue to
gain economic power, there is no shortage of opportunities for further
research on questions around how content is affected by the indus-
trial change, how television production companies can adjust success-
fully to advancing technology and how public policy can help ensure that
independent production continues to thrive.
In our analysis we drew on two original quantitative databases created
for the project. One of these examines the business performance of
our sample group over an eleven year period from 2007–2017 and is
based on data drawn from analysis of company report and accounts
and other secondary sources of financial data, including the indispens-
able survey of the production sector commissioned by PACT annually
and produced by leading media consultancy Oliver & Ohlbaum Asso-
ciates (Oliver & Ohlbaum, 2019). The second database analyses the sort
of content produced by the sample group and is based on categorising,
coding and rating their content outputs (according to such measures as
distribution reach, ratings and awards received) over the same 2007–2017
study period.
Our investigation also involved extensive fieldwork including some 50
interviews with corporate financiers specialising in takeovers in the televi-
sion industry, key policy-makers and with senior executives at production
companies and at their parent companies. Interviewees at selected produc-
tion companies included Chief Executive Officers and heads of legal and
business affairs with responsibility for business strategy, senior distribution
executives and Chief Creative Officers with responsibility for overseeing
content production. Our interviews (with only a couple of exceptions,
which were conducted by telephone) were generally all audio-recorded
face-to-face. All were professionally transcribed with full confidentiality
observed where requested. We have given the dates and the locations
on which these interviews took place. We have in all cases respected the
wishes of contributors and, in instances where we have been unable to
PREFACE vii

directly cite our sources, they have nonetheless very valuably informed
our study.
We thank Research Associate Dr. Michael O’ Neill who partici-
pated throughout the research project. In particular, we are grateful for
Michael’s work in coding, categorisation and measurement of program-
ming outputs for our sample group of companies—his care and efficiency
was invaluable in completion of the content database.
We are very grateful to interviewees, including the following, who
kindly consented to participate in our research: Sir Peter Bazalgette at
ITV, Zai Bennett at Sky Television, Ross Biggam at Discovery, Roberto
Suarez Candel of the European Broadcasting Union, Nick Catliff at Lion
Television, Susan Cooke at Media Wizards, Ed Coulthard at Blast! Films,
Simon Cox at Endemol Shine International, Andrew Critchley at Red
Productions, Tim Davie at BBC Studios, Thomas Dey at About Corpo-
rate Finance, Bruce Dixon at Pulse Films, Sachin Dosani at Wonderhood
Studios, Matt Elek at Vice, David Frank at Dial Square, Jane Featherstone
at Sister Pictures, Wayne Garvie at Sony Pictures Television International,
Charlie Goldberg at Left Bank Pictures, Anna Herold at GD CNECT of
the European Commission, Tim Hincks at Expectation Entertainment;
Jacquie Hughes at Ofcom, Alastair Jones at DCMS, Elena Lai of CEPI,
Rose Lubega at DCMS, Kevin Lygo at ITV Studios, Debbie Manners at
The Ingenious Group, Richard McKerrow at Love Productions, Stewart
McKinnon at Headline Pictures, John McVay of PACT, Jane Millichip
at Sky Vision, Jimmy Mulville at Hat Trick Productions, Mark Oliver at
Oliver & Ohlbaum Associates, James Penny at Mammoth Screen, Jon
Thoday at Avalon, Jane Turton at All3Media, Siobhan Walsh at Ofcom,
Jes Wilkins at Firecracker, Beth Willis at The Forge; John Willis at Tinop-
olis, Doug Wood at Endemol Shine, Sue Vertue at Hartswood Films and
Andrew Zein at Warner Brothers International Television.
We thank Andrea Esser, Professor of Media & Globalisationat
Roehampton University, John McVay at PACT (the trade association
for UK independent producers), Philip Schlesinger, Professor in Cultural
Policy at the University of Glasgow, Dr. Simon Harden at Univer-
sity College London, Raymond Boyle, Professor of Communications at
Glasgow and David Booth at media consultancy DBB12, who, over the
course of the project, provided invaluable guidance and advice. Thanks
also to commissioning editors Lucy Batrouney (Palgrave Global Media
viii PREFACE

Policy and Business Series) and Mala Sanghera-Warren and to the rest of
the team at Palgrave Macmillan for superb support.

Glasgow, UK Prof. Gillian Doyle


Richard Paterson
Dr. Kenny Barr
Contents

1 Introduction 1
What Is Television Production? 2
Typology of Production Companies 5
Independent Producers or Indies 6
Vertically Integrated 7
Conglomerates and Super-Indies 7
Why Does Television Production Matter? 7
Television Production in Transition—Aims and Methods 10
Layout of the Book 16
References 18
2 International Trends 21
Early Formation, Growth and Internationalisation 22
Key Territories 26
Us 26
Europe 30
Rest of the World 34
Digitisation and Convergence 39
References 44
3 From Minnows to Sharks 53
Early History 53
Annan Report and Channel 4 56
Peacock, the 1990 Act and Increased Competition 59

ix
x CONTENTS

2003 Communications Act 63


Success, Growth and Consolidation 67
References 71
4 Business Performance and Advantages of Takeover 75
Performance Measurement 76
Determinants of Business Performance 82
Advantages Conferred by Takeover 90
Advantages of Scale 91
Market Access 94
Bargaining Power 96
Informational Advantages 99
References 101
5 Scale, Independence and Economic Sustainability 103
Specialist Financial Intermediaries and M&A Activity 104
Trade Buyers Versus Professional Investors 110
Strategic Complementarity 112
Building Scale 113
Vertical Expansion 116
International Reach 119
Reconfiguring for the Digital Era 121
Scaling up and Remaining Independent: The Challenges 122
References 125
6 Configuration and Content 129
Measuring Content 130
Ownership, Control and Content: A Complex Relationship 133
Corporate Configuration and Content: Findings 136
Creative and Business Leadership 138
Commercial Ambitions, Content Strategies and Continuity 139
The Corporate Behemoth 142
Strategic Function and Content 148
Horizontally Integrated Super-Indies 149
Vertically Integrated Broadcaster Producers 150
Distribution Plus Production 152
Transnational Groups 154
References 157
7 Cultural Production, Indigeneity and Globalisation 163
He Who Pays the Piper Calls the Tune 164
CONTENTS xi

Non-scripted Factual and Entertainment 167


Scripted Content 171
Is There Such a Thing as British Content? 174
Home Versus International Markets 178
IPRs and Windowing 183
References 187
8 Conclusions and Implications for Policy 193
Changing Corporate Ownership Configurations 193
Do We Need TV Production Companies that Are
Independent? 197
Is the Definition of Independents Still Valid? 201
Sustaining Renewal 206
Digital Transformations and the Challenges for Policy 210
References 219

Bibliography 225
Index 249
List of Figures

Fig. 4.1 Turnover for case study companies, 2007–2017 83


Fig. 4.2 Operating profit margins for case study companies,
2007–2017 83
Fig. 4.3 Left Bank Pictures, turnover and total hours transmitted 85
Fig. 4.4 Love Productions, turnover and total hours transmitted 86
Fig. 4.5 Mammoth Screen, turnover and total hours transmitted 88
Fig. 4.6 Mammoth Screen, first run output by commissioner 95
Fig. 7.1 Lion Television, story and reach 168

xiii
List of Tables

Table 1.1 Production company ownership configurations 6


Table 1.2 Case study production companies 14
Table 3.1 Chronology of key UK policy interventions 67
Table 4.1 Case study production companies 78
Table 4.2 Case study companies in 2007 and in 2017 80
Table 6.1 Case study companies by specialism and key outputs 131

xv
CHAPTER 1

Introduction

While creativity is thriving in the UK, many businesses struggle to make the
step from executing successful projects to becoming fully-fledged, sustain-
able creative businesses… Despite its reputation for world-class content,
the UK has very few creative businesses of an international scale (and not
enough work has been done to understand why).
Often, companies that achieve early success are acquired by a large interna-
tional player, rather than building sustainable businesses in the UK. While
we want the UK to continue to be an attractive country for inward invest-
ment, it is vital that those companies that want to grow organically have
the means to do so.
(Create UK, Creative Industries Strategy 2014: 6)

In the UK and beyond, television production is seen as a vital component


of the creative industries and a sector whose performance has impor-
tant cultural and economic ramifications. Of the £112bn that creative
industries contributed to the UK economy in 2018, in excess of £20bn
was accounted for by ‘film, TV, video, radio and photography’ (DCMS
2020). Sales of finished television programme and formats are a major
and growing contributor to UK creative industries exports (DCMS 2015:
26). According to data commissioned regularly by the trade association
for producers PACT, the value of UK television exports had reached
£1.4bn in 2018/2019 (Pact/3Vision 2019). In addition to the sector’s

© The Author(s), under exclusive license to Springer Nature 1


Switzerland AG 2021
G. Doyle et al., Television Production in Transition,
Palgrave Global Media Policy and Business,
https://doi.org/10.1007/978-3-030-63215-1_1
2 G. DOYLE ET AL.

financial significance, the ways in which television is ‘tied to local and


national cultures’ (Waisbord 2004) and the contributions to culture
that a healthy indigenous television production sector can make are
also widely recognised (Barker 1999; Hall 1992). However a recent
restructuring in ownership of the television industry has raised concern
about the ability of independent production companies to survive in an
increasingly globalised and competitive environment for television. Many
leading independent television production companies across the globe
have become prime targets for corporate activity in recent years and many
have been subject to takeover, often by large broadcasters and by US
media groups. Does this matter?
This book, drawing on a major research project funded by the UK
Economic and Social Research Council (ESRC),1 investigates the rela-
tionship between independence, scale and economic sustainability in the
television production sector and related implications for public policy.
Focusing on the growing power of transnational media corporations in an
increasingly globalised environment for distribution of television content,
and on the effects of mergers and acquisitions involving local and inde-
pendent television production companies, it examines how current and
recent restructurings in ownership across the television industry reflect
changing business models, how they affect creativity and diversity of
television output, and to what extent they call for new approaches to regu-
lation and policy. Based on a major study of the UK production sector as
a case study, it offers a unique analysis of wider transformations in owner-
ship affecting the television production industry worldwide and of their
economic, socio-cultural and policy implications.

What Is Television Production?


The process of supplying television or video content to viewers can be
broken down into a number of stages in what Michael Porter has referred
to as the vertical value chain (Porter 1985). One of the key stages in the
chain is production or making content. Television production companies
develop ideas for programmes and make content which they then sell to
service providers who, in turn, convey it to audiences. Service providers
such as broadcasters and subscription video on demand (SVoD) services

1 We gratefully acknowledge the support of the Economic & Social Research Council
(Reference ES/N015258/1).
1 INTRODUCTION 3

such as Netflix, as the gateway to viewers, occupy a very powerful position


in the supply chain. But all stages in the vertical supply chain are interde-
pendent (Doyle 2013)—content service providers cannot survive without
programmes and content producers need outlets to sell their wares to.
The interdependent nature of the relationship between different phases
in the supply chain has important implications for the sorts of corporate
ownership strategies that are pursued by television companies.
The history and characteristics of television production vary some-
what from one country to another and in many instances public policy
has played a key role in shaping the development of the industry. In
the UK for example, the impetus to establish and sustain a television
sector that is independent (i.e. not cross-owned by broadcasters) can
be traced back to the Annan Report of 1977 and it has been acted
on through a series of policy interventions such as the setting up of
Channel 4 as a ‘publisher-broadcaster’ in 1982 and, later, the impo-
sition of compulsory access quotas for ‘indies’ on other public service
broadcasters (Doyle and Paterson 2008). A particularly influential inter-
vention came via the 2003 Communications Act which required UK
regulator Ofcom to oversee new terms of trade in commissioning nego-
tiations between public service broadcasters and independent producers
which, in turn, enabled UK indies to retain a greater share of owner-
ship in the intellectual property rights (IPRs) to their productions and
greatly improved their business performance (ibid.). Other initiatives to
encourage the development of independent production across the UK
have included, for example, support for regional and minority program-
ming and provision of tax incentives for high-end television productions
and children’s programmes.
Adjustments in UK public policy that enhanced the performance of
production companies and boosted their sales revenues have also, in turn,
marked out the UK’s leading independent producers as attractive vehi-
cles for takeover. A notable corollary to greater commercial success over
recent years has been increased investment interest in the sector, often
from international media and television groups (Chalaby 2010; Campelli
2015; Lee 2018). The trend towards consolidation and takeovers of tele-
vision production companies has not been confined to the UK (Agnew
2017). But UK production companies have become especially attrac-
tive targets for US and other international media groups such as NBC
Universal, Warner Brothers and Banijay Group who, since 2008, have
bought up a significant number of programme-making companies (Barker
2020; Ofcom 2015: 13; Paterson 2017b).
4 G. DOYLE ET AL.

It is not only international groups but also domestic UK broadcasters


who have been acquiring programme-making companies. For example,
advertising-supported network broadcaster ITV plc has bought up a
number of large and small UK and US independent television producers
since 2010. Likewise, subscriber-based broadcaster Sky Television has
acquired or made equity investments in several television production busi-
nesses over recent years. A central concern in this book is to build an
understanding of what has been driving major restructurings in owner-
ship in the television industry in recent years. What are the implications of
takeovers and consolidation of ownership in the production sector? What
difference do takeovers make to the economics of production companies
and to the nature of the content that they make?
The core activity that production companies perform is making
programmes or other forms of television content. But, related to this,
producers often engage in two other activities: pitching ideas for new
programmes to ‘commissioners’ or buyers; and selling or exploiting
secondary rights in the programmes that they have already made.
The marketplace for new or original television content in which
production companies pitch their ideas to commissioners is generally
competitive amongst producers and is ever-changing (Lourenço and
Turner 2019). From its inception in the 1920s to the present day, the
conduits and platforms through which audiences are able to enjoy televi-
sion content have evolved continuously. Whereas in the past broadcasters
supplying content to audiences via schedule-based television channels
were very dominant, nowadays SVoD services such as Netflix and Amazon
Prime offering on-demand content have become an increasingly impor-
tant touchpoint for audiences. But commissions for original television
content still take place in markets that are oligopsony in the sense that
they are dominated by a relatively small number of buyers. Growth in
digital delivery platforms and online services which, in turn, has facili-
tated transformation in consumption behaviours has radically reshaped the
landscape of provision over recent years (Ofcom 2019). As one television
production executive who is a former chair of the UK trade association
Pact puts it:

…we all thought twenty years ago that television would be dead by now
and of course it’s not. Because television as we know it still exists. It’s still
alive and well but it’s sitting on different platforms.
(Manners, Interview, London, November 2018)
1 INTRODUCTION 5

Far from being in decline, overall consumption of television content is


increasing (Lee 2018: 3; Ofcom 2019: 16). And, notwithstanding the
need to adapt to a changing television landscape, television production
companies still make their living from pitching, making and then licensing
rights to television content. Consequently, having the talent and relation-
ships needed to win commissions and, also, the skills and other resources
needed to cost-effectively produce content that audiences find appealing
are key to economic success in the production sector (Doyle 2018; North
and Oliver 2010). Effective exploitation of intellectual property rights
(IPRs) also plays a vital role in the business performance of television
production companies (Doyle 2016; Doyle and Paterson 2008; Media-
tique 2015; Oliver and Ohlbaum 2015). A key issue that this book sets
out to examine is the extent to which, in the era of globalised televi-
sion distribution, added to the above attributes and capabilities which
determine the viability of production companies as enterprises, economic
success also now hinges on having the right sort of corporate ownership
arrangements.

Typology of Production Companies


One very notable feature of the television production sector is its hetero-
geneity. The origins and aspirations of production firms vary (Paterson
2017a) but by their nature all are creative and highly individual. Although
often defined by the genre of content they make, such as drama producers
or comedy producers or factual entertainment producers, companies that
are medium or large often have mixed portfolios of output. Production
companies vary enormously in scale with some employing hundreds of
individuals (often including freelancers) and others just a handful or even
one or two people. In the UK, for example, despite the presence of
many large entities or so-called ‘super-indies’, the production sector is also
heavily populated by an abundance of very small companies (Mediatique
2015; Oliver and Ohlbaum 2018). Production firms also vary widely in
terms of their ownership.
Our research sets out to examine how the business operations and the
sort of content that television production companies make are affected
by their corporate ownership configuration. Configuration in this context
refers to whether a company is an independent producer or whether it is
a subsidiary of another company and, if the latter, what sort of organisa-
tion the parent company is. Table 1.1 below details the main ‘types’ of
television production companies that we focus on in this book.
6 G. DOYLE ET AL.

Table 1.1 Production company ownership configurations

Company Size Small Medium Large


Turnover < £1 m Turnover Turnover > £10 m
£1 m–£10 m

Stand-alone Indie
No cross ownership from broadcasters
Part-Vertically Integrated
Up to 25% broadcaster owned
Ownership Vertically Integrated UK
Configuration +25% UK broadcaster owned
Vertically Integrated Non-UK
+25% non-UK broadcaster owned
Conglomerate UK
Horizontally integrated UK cluster/‘Super-Indie’
Conglomerate Non-UK
Horizontally integrated non-UK cluster/‘Super-Indie’

Independent Producers or Indies


A central focus in our study is independent television producers or
‘indies’. Although the term ‘indies’ as it applies to cultural sectors is
sometimes tinged with political and ideological resonance, suggestive
of entities that stand in opposition to prevailing mores, many indepen-
dents are straightforwardly mainstream and commercial in their profiles
and instincts (Hesmondhalgh 1997). The term ‘independent’ takes on
different interpretations in differing circumstances. When it comes to
media, it is often strongly associated with the idea of independence
or freedom from state interference (Bennett and Strange 2014). In
the television production industry, ‘independent’ generally distinguishes
companies that are autonomous from production operations that are
integrated within or cross-owned by broadcast organisations.
In the UK, the definition of an independent producer has been imbued
with legal significance since the publication of the Broadcasting Act 1990
which imposed minimum compulsory access quotas on PSB channels for
transmission of programmes made by independent producers. Similarly,
‘independent’ producers are defined under EU legislation so as to facil-
itate compliance with a 10% compulsory access quota, contained in the
European Audiovisual Media Services Directive, for independently-made
programmes (CEC 2018). In the context of this study, the concept of
an ‘independent’ television producer means not owned by a television
broadcaster or by a major non-UK parent television company.
1 INTRODUCTION 7

Vertically Integrated
By contrast, vertically integrated production companies are those that are
cross-owned by broadcasters or vice versa. Supplying television content
is in some ways an uncertain business and the desire for more control
over the market environment acts as a powerful incentive to become
vertically integrated by diversifying into additional upstream or down-
stream phases in the value chain or vertical supply chain. Involvement in
both production of content, which brings ownership of valuable IPRs,
plus broadcasting, which allows exploitation of content rights, yields
obvious advantages in terms of strategic complementarity. So in many
countries such as the UK the television production industry is composed
of both the in-house production divisions of vertically integrated broad-
casters (such as the BBC and ITV plc) and an ‘independent’ production
sector which is populated by stand-alone programme-makers that are not
cross-owned by domestic broadcasters, or vice versa.

Conglomerates and Super-Indies


Another prominent corporate ownership configuration in the television
production sector is the consolidated conglomerate or the so-called
‘super-indie’ (Chalaby 2010; Esser 2016). Many of these started life as
small independent production companies who achieved success and over
time have grown organically to become very sizeable companies. But
super-indies are also often the result of a series of mergers with or acqui-
sitions of other independent production companies. Many super-indies
are effectively clusters of independent production businesses or ‘labels’
operating, with levels of autonomy that vary from one group to another,
under the collective ownership of a consolidated parent companies. The
scale of revenues earned by some super-indies now exceeds that of major
broadcast organisations and many have well-developed in-house interna-
tional distribution businesses, making these very powerful players in the
television ecosystem (Lee 2018).

Why Does Television Production Matter?


Ownership structures in the television industry have undergone ‘seismic’
changes in recent years (Parker 2015). The UK has been particularly
affected by waves of takeovers of production companies, resulting in the
8 G. DOYLE ET AL.

growing controlling presence of consolidated entities, many of whom are


owned by non-domestic parent groups. Levels of consolidation within the
UK sector are demonstrated by the fact that, for example, the propor-
tion of expenditure by UK PSBs on external programme commissions
that is accounted for by the ten largest television production compa-
nies increased from 19% in 1993 to 45% in 2003 and to 66% in 2014
(Mediatique estimates, Broadcast, Televisual, Pact cited in Ofcom 2015:
18).
Transformations in ownership have been an area of concern, triggering
critical questions from policy-makers, industry commentators, academics
and the press as to why it seems so difficult for cultural production busi-
nesses to grow and flourish while remaining independent and indigenous.
Why is it that, in the digital era, some forms of corporate ownership
configuration appear to be more conducive to economic success than
others? Why is it that local programme-makers struggle to achieve scale
and sustained economic success while at the same time retaining ‘indepen-
dent’ status? A prevailing assumption underlying such concerns, prevalent
among academics, policy-makers and practitioners alike, is that ownership
of television production companies matters (Doyle and Paterson 2008;
Abraham 2014; Chalaby and Esser 2017; Lee 2018). But why is it that
custodianship of the television production sector matters so much?
One reason is economics. Producing television content is a major inter-
national business that employs tens of thousands of individuals across
the globe and generates billions of pounds in commercial revenue every
year for producers. It is well recognised that, in the words of the Euro-
pean Commission, ‘[t]he audiovisual sector has the potential to create
hundreds of thousands of high-skill jobs’ (COM 1999). Historically, the
audiovisual (i.e. film and television) production sector in the US has been
exceptionally successful in making and selling content and it remains by
far the largest and most economically successful exporter of television,
with the UK now in second place albeit some distance behind (Doyle
2014; Steemers 2014).
In most countries, public and political interest in the state of health
of indigenous television production businesses is at least partly a reflec-
tion of economic issues. The general idea, first popularised by Richard
Florida (2002), that creative sectors of the economy—which include tele-
vision production—are especially important as drivers of wider economic
growth, has been widely embraced by policy-makers across Europe and
around the globe in recent years (Cunningham 2002; Schlesinger 2007).
1 INTRODUCTION 9

So it is no surprise that, in the UK for example, television production


has been celebrated as part of a creative sector that, as noted by the
then Chancellor of the Exchequer George Osborne (cited in Olsberg and
Nordicity 2015: v) ‘adds billions to UK GDP each year and supports
jobs across the country’ as well as strengthening the UK’s ‘infrastructure
of innovation’.
Ownership of television production companies also matters for socio-
cultural reasons. One such is the importance of culture in conveying what
Joseph Nye has referred to as ‘soft power’ (Nye 2004) or the ability to
persuade others without such traditional means as military might. Nowa-
days film and television, through conveying a sense of the attractiveness
of a country’s culture, political ideals, and policies, represent important
instruments of soft power and therefore any country’s stake in globalised
cultural production industries is a matter of strategic socio-political and
cultural concern (ibid.).
In addition, it is widely assumed that, despite globalisation, identity
remains anchored within national space and that culture—of which tele-
vision is a part—plays a vital in reproducing identity (Schlesinger 1997).
Consequently, the organisation and ownership of industries involved in
cultural production, such as television, matters greatly. As pointed out by
the European Commission:

[w]hilst the economic aspects and the job creating potential of the sector as
outlined above are clearly major elements to be taken into account … it is
the social and cultural role of the audiovisual media that forms the point
of departure for policy making… [AV media] ‘play a central role in the
functioning of modern democratic societies’ … [and]… in the development
and transmission of social values’ …[and]… ‘help to determine not only
what we see of the world but also how we see it.’ (COM 1999)

Television, as a key aspect of culture, forms part of ‘an active shaping


repertoire of meanings and images, embodied in values, myths and
symbols that serve to unite’ (Smith 1998: 187). Production of televi-
sion is seen as having far-reaching potential to shape and inform the
views and values of individuals and society at large. Even what might be
considered inoffensive or banal ‘lifestyle’ content often reflects and prop-
agates what might be seen as weighted agendas. For example, the BBC’s
hit daytime property auction programme Homes Under the Hammer
10 G. DOYLE ET AL.

produced by Lion Television is imbued with the unquestioning assump-


tion that ownership of private property is a positive aspiration for citizens.
An understated endorsement of aspiration and self-improvement within
this highly localised programming demonstrates that even the most appar-
ently neutral material may serve to shape values and underscore notions
of identity, citizenship and nationhood (McElroy 2008: 50). Therefore,
as Sylvia Harvey argues, custodianship of businesses that involve creation
of cultural outputs and exploitation of rights to television content:

raises questions that go beyond that of markets and of economic value.


The generation of IP, how and by whom, is also of great importance to
… culture, society and politics.
(Harvey 2015)

Television Production
in Transition---Aims and Methods
The aim of this book is to build an understanding of the implications
of recent ‘seismic’ shifts in ownership in a sector where custodianship is
recognised to be of importance both for economic and cultural reasons.
Findings are based on research carried out as part of a major project
entitled Television in Transition: Independence, Scale and Sustainability
conducted by a team based at the Centre for Cultural Policy Research
(CCPR) at the University of Glasgow over a three and a half year period
from 2017 until 2020. Funded by the UK Economic & Social Research
Council (ESRC), the project set out to examine how and why the struc-
ture of ownership of the UK television production sector has shifted over
recent years and what this means for the economic sustainability of the
sector, for audiences and for content.
Using key case studies, the scope of our investigation covered the
role of changing digital distribution technologies in encouraging consol-
idation and strategies of horizontal, vertical and transnational expansion
in the television production industry; the relationship between, on one
hand, size and corporate configuration and, on the other, the ability of
production companies to maximise the value of their IPRs and to achieve
sustained economic success; the conditions that govern creative decision-
making and content in the production industry and how these are affected
by differing corporate configurations; and implications for public policy
and regulation. Our research questions covered three themes: How do
1 INTRODUCTION 11

expansion, scale and differing corporate ownership arrangements affect


business performance and sustainability? How do changes in corporate
configuration affect creative decision-making and content? What are the
implications for policy?
As is evident from the findings presented in later chapters, a key
focus throughout our research has been the growing importance of
ownership as a powerful determinant of financial and economic success
in the television production sector. Recent waves of takeovers, mergers
and acquisitions involving UK and European programme-makers suggest
that, in an increasingly globalised television environment, certain forms
of configuration are more conducive to economic success than others
and thus ownership has now become a decisive success factor for firms
operating in the television production sector. One of the main aims of
the project is to better understand the nature of the interplay between
ownership configuration and performance. To what extent are changing
digital distribution technologies encouraging consolidation and strate-
gies of horizontal, vertical and transnational expansion in the television
production industry? Earlier studies have suggested that the ability of
producers to operate profitably is linked to scale (Doyle 2018; North and
Oliver 2010). What exactly is the relationship between, on one hand, size
and corporate configuration and, on the other, the ability of production
companies to achieve sustained economic success? Is the sustainability of
a domestically based independent production sector threatened?
A further concern is to investigate empirically how a restructuring of
ownership may affect content. What difference do changes in ownership
make to the nature of television content and to creative decision-making
within production companies? It is widely assumed that consolidation and
takeovers of indigenous and independent television production companies
by US or other foreign multinationals are detrimental to content—for
example, by stifling creativity (Abraham 2014)—but little earlier research
has been conducted which tests this out empirically.
How should media policy-making respond to major changes in owner-
ship of television production companies? At a time of concern about
how incumbent television production companies can adjust successfully to
advancing technology and how public policies ought to change to ensure
that independent and indigenous production continues to flourish in the
global arena, the project findings reported in this book are intended to
deepen and enhance public understanding of creative and business strate-
gies in the context of a rapidly evolving media ecology. By offering an
12 G. DOYLE ET AL.

extensive empirically-based analysis of the connections between transna-


tional corporate power, ownership configuration, business performance
and content in the television production industry, our aim is to advance
understanding not only of the economic and socio-cultural significance of
restructurings of ownership in the television industry but also of the wider
interplay between cultural production, indigeneity and globalisation.
Our project involved a multiple case study based research design
focusing on the experience a number leading UK-based television produc-
tion companies of differing configurations. Methods, which are described
in further detail in Chapters 4 and 6 below, involved both quantita-
tive and qualitative dimensions. We draw on a range of methodologies
including expert interviews and analysis of financial data, policy texts and
content output. The approach was multidisciplinary, drawing on theo-
retical perspectives from management, economics, media and cultural
sociology and policy studies while using some techniques (e.g. correla-
tion analysis) common in economics and others (e.g. content analysis)
that are more typical of socio-cultural studies.
One of the key aims was to examine the relationship between, on the
one hand, expansion, scale and different sorts of corporate configurations
(whether owned by a multinational parent company; vertically integrated
or not) and, on the other, economic performance and capacity to engage
in business strategies that sustain growth. What are the key factors
that conduce to economic success and sustainability in the TV produc-
tion sector? What is the nature of the association between corporate
configuration and performance? Findings were derived through system-
atic investigation, based primarily on analysis of company accounts and
statements and other secondary sources of financial data for a sample of
leading UK-based television production companies and on interview find-
ings, based around the question of what is the relationship between the
ownership ‘configuration’ (i.e. size and whether owned by a multinational
parent company or whether vertically integrated or not) of a company and
its performance.
The difficulties of defining success and sustainability and of identi-
fying suitable measures of performance in the context of media industries
are numerous and well recognised (Wirth and Bloch 1995). Although
standard financial accounting measures such as changes in turnover and
operating profit margins, which offer useful benchmarks, were a central
focus in our analysis of the business performance of our case study compa-
nies, the overall design of our framework also reflected an awareness of
1 INTRODUCTION 13

the fact that evaluating performance in the context of media and cultural
sectors requires attention to be paid to non-economic indicators too such
as audiences, awards and critical reception for outputs.
Another key aspect of the project was to examine how changes in
ownership affect content. In order to investigate the relationship between
corporate ownership and content, we conducted an analysis of program-
ming outputs for several different types of television production compa-
nies based on their organisational configurations (i.e. whether a true
independent, owned by a conglomerate—UK-based or non-domestic, or
partially or fully vertically integrated) and based on genre (i.e. whether
drama or factual entertainment producers), in each case studying the sort
of content produced over an eleven year period from 2007–2017. This
involved detailed tracking and analysis of all programmes made at each
case study company over the study period in order to gauge continuity or
change in the volume and nature of its outputs and in how it’s content
fared for example on terms of distribution reach, ratings, awards and
critical acclaim.
Findings from the analysis of content were combined with evidence
from interviews carried out with senior executives at production compa-
nies and with their parent companies and with corporate financiers
specialising in takeovers in the television industry. Interviewees at selected
production companies included Chief Executive Officers (CEOs) with
responsibility for the overall strategy, Chief Creative Officers (CCOs) with
frontline responsibility for developing and producing content, and also
directors of legal and business affairs.
Case study companies were selected based on the need to investigate
our research questions across a range of differing types of production
companies in terms of scale, output and ownership configurations—see
Table 1.2. All were founded in the UK as independent production compa-
nies and the sample group includes producers of different genres of
output. Although mainly London-based, many have activities that extend
across a range of international territories. Many of the production compa-
nies within the sample were taken over during the study period. Thus,
this particular selection of companies and the spread of individuals that
we conducted interviews with enabled us to carry out extensive evidence-
gathering on our core questions about how changes in ownership have
affected business performance and content in the production sector.
14

Table 1.2 Case study production companies

Company Founded Ownership Parent company Principal genre Key outputs


configuration (year of takeover)

Hartswood Films 1979 Stand-alone Indie n/a Drama Lady Chatterley’s


Lover, Sherlock,
Dracula
Hat Trick 1986 Stand-alone Indie n/a Comedy/Factual/Entertainment Boomers, Episodes,
G. DOYLE ET AL.

Have I Got News


for You?
Keo Films 1996 Stand-alone Indie n/a Factual/ Hugh’s Fish Fight,
Entertainment Skint, River
Cottage
Firecracker 2002 Conglomerate Tinopolis Factual Dr. Christian Will
UK (2012) See You Now, My
Big Fat Gypsy
Wedding,
Kudos 1992 Conglomerate Endemol Shine Drama Hustle, Law &
UKa (2006) Order UK, Spooks
Left Bank 2007 Conglomerate Sony Drama The Crown,
Non-UK (2012) Outlander, Strike
Back
Lion 1997 Conglomerate All3Media Children’s/Factual/Entertainment Horrible Histories,
UK (2004) Homes Under the
Hammer
Pulse Films 2004 Conglomerate Vice Media Factual/Entertainment Pillow Talk,
Non-UK (2016) Pineapple Dance
Studios
Blast! Films 1994 Vertically Sky Factual/Entertainment 999 What’s Your
Integrated (2015) Emergency?, The
UK Supervet
Company Founded Ownership Parent company Principal genre Key outputs
configuration (year of takeover)

Love 2004 Vertically Sky Factual/Entertainment Benefits Street,


Productions Integrated (2014) Great British Bake
UK Off, Great British
Sewing Bee
Mammoth 2006 Vertically ITV Drama And Then There
Screen Integrated (2015) Were None,
UK Endeavour,
Poldark
Red Production 1997 Vertically Studio Canal Drama Last Tango in
Co. Integrated (2013) Halifax, Ordinary
Non-UK Lies, Scott &
Bailey

a After the project study period ended a takeover of Kudos’ parent company, Endemol Shine, by French entertainment conglomerate Banijay Group
was completed in July 2020.
1
INTRODUCTION
15
16 G. DOYLE ET AL.

Layout of the Book


Drawing on interviews with leading television executives and industry
stakeholders and on extensive quantitative analysis of company data and
programme content, this book provides an empirically grounded exam-
ination of how and why major transformations have taken place in
the structure of ownership of the television production industry and
what this implies for the economics of the sector and for content.
How do changes in custodianship affect creative decision-making within
production companies? Why is it that local programme-makers struggle
to achieve scale and sustained economic success while at the same
time retaining ‘independent’ status? How should media policy-making
respond?
Chapters 2 and 3 provide contextual analyses that lay the back-
ground for the empirically based exploration, which follows in later
chapters, of changing economic and business circumstances, how these
affect creativity, content and audiences, and implications for public-
policy-making. Chapter 2 starts with an account of how the television
production industry has developed historically in the US, Europe, the
Far East and other key territories. It also provides a developed analysis of
recent trends arising from digital convergence and, in particular, glob-
alisation of television distribution including such key developments as
the emergence of SVoDs. Chapter 3 follows on by providing a focused
account of the history and development of the UK television production
sector and of the crucial role played by public policy in supporting its
growth (Paterson 2017b). It examines the UK sector’s dramatic transition
‘from minnows to sharks’ and traces out recent transformative changes in
ownership of the production sector.
Chapters 4 and 5 focus on elucidating the economic rationale behind
these changes. Drawing on extensive evidence gathered from our multiple
case study sample group of leading London-based international televi-
sion production companies, Chapter 4 examines the relationship between,
on the one hand, expansion, scale and different sorts of corporate
configurations (whether owned by a multinational parent company; verti-
cally integrated or not) and, on the other, economic performance and
capacity to engage in business strategies that sustain growth in a digital
multi-platform distribution environment. Chapter 4 draws heavily on
self-originated quantitative analyses of a number of key aspects of busi-
ness performance and on qualitative analysis of original material drawn
1 INTRODUCTION 17

from interviews with leading executives across the selected case studies to
examine the business advantages conferred on production companies that
are taken over and to how ownership and changes in ownership config-
uration correlate with business performance in the television production
industry in the twenty-first century.
In Chapter 5 the focus shifts from the experience of production compa-
nies (sellers) to the perspective of investors (buyers). We assess the crucial
role played by advisors and specialist financial intermediaries in matching
buyers and sellers and in facilitating merger and acquisition (M&A) trans-
actions. We also delve more deeply into the main business and economic
motives that have driven M&A strategies and the attributes regarded by
buyers as lending greatest appeal to production companies as investments.
Thus, Chapter 5 sets out the important ways that the empirical findings
of this study extend knowledge and theory about propensities towards
consolidation and concentration in a digitally convergent and increas-
ingly supra-territorial landscape of media provision. In Chapter 5 we also
consider why it is that producers struggle to scale up and remain ‘inde-
pendent’ and whether there is now effectively a Minimum Efficient Size
for television companies.
In Chapters 6 and 7 our attention shifts to the question of how
changes in corporate configuration affect creative decision-making and
content. Drawing on both content analysis and interview findings,
Chapter 6 presents and analyses the findings of our investigation into how
differing sorts of corporate configurations effect the quality and nature
of content outputs in the television production industry. Drawing on the
insights provided in Chapter 6 about how ownership configuration affects
content, in Chapter 7 we reflect more widely on the socio-cultural signifi-
cance of recent transformations affecting the television industry, including
the growing significance of transnational distribution. We focus on the
role of market demand or commissioning as a powerful force shaping
production of television content. The growing influence of globalised and
multinational content service providers is examined and we ask whether
concerns about potential marginalisation of indigenous cultures remain
valid in an increasingly globalised environment for television content. We
consider the effects of the rise of SVoD services both as a force for disjunc-
tion in eroding production financing models that have supported the
success of the UK production sector and also as an agent of continuity
in advancing processes of transnationalisation of television.
18 G. DOYLE ET AL.

Chapter 8 offers a cohesive concluding analysis of the study’s find-


ings about configuration, strategy, performance, content decision-making
and output. These are drawn together and woven into an overarching
analysis of the challenges for contemporary media policy-making posed
by recent restructurings of ownership in the television industry. To what
extent is the sustainability of domestically based independent produc-
tion threatened by such restructurings? What are the implications for
content, culture and the creative economy? How does public policy need
to change? As well as reinforcing the book’s contribution to knowl-
edge and theory on these pressing themes, the analysis presented in
Chapter 8 is also intended as a timely aide to industry strategists and
media policy-making.

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CHAPTER 2

International Trends

In this chapter and the next, we lay out the background for the findings
of changing ownership of the production sector which are presented and
analysed in later chapters of this book. In Chapter 3, a detailed analysis
of the historical development of the UK television production sector is
set out, highlighting the importance of a series of public policy interven-
tions in determining the character and circumstances of the contemporary
British programme-making landscape. First however, in this chapter we
sketch out key trends and issues affecting the historic and contemporary
development of television production as an international industry.
The focus here is on wider international industrial, technological
and economic contexts that have shaped the contemporary production
environment and associated patterns of international trade in television
content. In the first section, we outline the historic development of
production—often as an adjunct to broadcasting—and analyse key forces
that, over time, have encouraged gradually increasing levels of interna-
tionalisation of television. In later sections of the chapter, we examine how
television production has developed in a number of international territo-
ries including the US, Europe, South America and Far East. Finally, we
consider the effects of more recent technological and market shifts that
have dramatically advanced processes of globalisation of television in the
twenty-first century.

© The Author(s), under exclusive license to Springer Nature 21


Switzerland AG 2021
G. Doyle et al., Television Production in Transition,
Palgrave Global Media Policy and Business,
https://doi.org/10.1007/978-3-030-63215-1_2
22 G. DOYLE ET AL.

Early Formation, Growth and Internationalisation


Television is an industry that historically has been dominated by broad-
casters. Broadcasting tended to develop within national territories and to
be shaped by specific national circumstances and regulations, even into
the twenty-first century (Morris and Waisbord 2001). Although the char-
acteristics and circumstances of the industry differ from one country to
another, a trait which is widely shared is that, often, production of content
started out as an activity which was carried out by vertically integrated
broadcasters, operating at local or national level, in their in-house produc-
tion departments. While in the US some level of production of content
on behalf of broadcasters by external—often Hollywood-based—produc-
tion companies can be traced back to the inception of broadcasting,
in most other countries the emergence and separate development of a
programme-making sector that is recognisably ‘independent’ of broad-
casting is something which has only occurred from around the 1970s and
1980s onwards.
The birth and development of independent production has typi-
cally been spurred by two interrelated factors: advances in technology
and changes in public policy. As distribution technologies increased the
avenues available for delivery of content to viewers, this was frequently
accompanied by both de-regulatory and protective impulses on the part of
national regulators (Negrine and Papathanassopoulos 1991). Transfron-
tier broadcasting via cable and satellite broadcasting became widespread
in the 1970 and 1980s. From the 1990s onwards, the growing use
of digital compression techniques and the development of the internet
transformed the situation of so-called spectrum scarcity which previously
had constrained market entry into broadcasting and replaced it with one
of relative abundance in avenues for delivery of television content. As
channels proliferated, many more specialist and niche services developed,
often supported by direct viewer payments or subscriptions. These trends
precipitated an explosive increase in demand for attractive television
content (Doyle 2014).
Growing levels of transfrontier broadcasting naturally focused atten-
tion on the health and competitive positioning of domestic television
systems. Fears about the impact of globalisation were typified for example
in comments made during a UK Parliamentary Committee debate on
National Heritage which lamented that ‘UK players… are being overtaken
and overshadowed by the global media corporations that make, distribute
2 INTERNATIONAL TRENDS 23

and deliver film and television software all over the world’ (HoC 1993,
cited in Negrine 1998). More channels and greater resources to support
strategies of segmentation of audience demand combined with the spread
of transfrontier delivery platforms and the growth of thematic services
aimed at transnational audience groups (e.g. CNN, MTV, Discovery, etc.)
encouraged greater awareness, including among broadcast policy-makers,
of the growing opportunities surrounding the production and of the
potential value of having a well-developed indigenous television produc-
tion sector. Calls for more local production were fuelled by growth in the
number of commercial broadcasters and concerns about their reliance on
US-made content (Franquet et al. 2020). So, from the 1980s onwards,
technological advances that expanded avenues for delivery of television
not only ushered in more demand for content but also, in the UK and
many other countries, encouraged changes in approach towards policy
and regulation that resulted in more emphasis being placed on promoting
representational diversity and on improving the competitive position of
indigenous television production vis-a-vis international rivals.
As television systems have become increasingly internationalised over
time, this has favoured the development of programme-making as a sector
of economic activity that stands separately from broadcasting. Interna-
tionalisation has been spurred on by the launch of international channels
and pay-TV services (Chalaby 2003). Another route via which tele-
vision has expanded across frontiers is through co-productions where
programmes are funded by partners in differing territories (Hoskins et al.
1998; Hilmes 2014). Internationalisation has also been propelled by
growing cross-border trade in finished programmes and formats—broad-
casters and other service providers acquiring rights to programmes or
purchasing the right to use existing tried-and-tested formats from overseas
television companies, in some (though certainly not all) cases from neigh-
bouring countries or countries that share a common language (Doyle,
2014; Steemers 2014).
Fuelled by the rise of internet-based globalised streaming content
services who have been major buyers of both original and archive content,
the value of international trade in television content has grown consis-
tently in recent years (EAO 2020: 60; Steemers, 2016; USITC 2018;
WTO 2010). All available data about international trade in film and tele-
vision confirms that audiovisual is an area dominated by English language
products and particularly by exports from programme suppliers based in
one country: the US (Doyle 2014). A number of factors account for the
24 G. DOYLE ET AL.

success of US-based suppliers, including the size and wealth of the US


domestic television market, which makes it feasible for domestic producers
to invest in expensive scriptwriters and other talents (ibid.). However
since the 1980s the production sectors of other countries around the
globe, including in the Far East and South America, have benefitted from
growing international demand for content and increased cross-frontier
trade (USITC 2018). The UK production sector has been a major bene-
ficiary of increased international demand for content and, as is discussed
in Chapter 3, exports of finished programmes and formats from the UK
have grown exponentially over recent years (Pact/3Vision 2019). But the
UK is just one component within an increasingly globalised landscape for
production and supply of television content, as reflected in the interna-
tional ownership profiles of a number of our case studies where parent
companies are headquartered in Europe, the US and/or Japan.
The development of independent production at regional and national
levels across the globe reflects a combination of both local and wider
circumstances that are shared across most territories. The production
sector of any country has its own identity and idiosyncrasies but, more
generally, this is an activity whose development has been powerfully
shaped by economic factors. The fundamental economics of television
content production, which are distinctive in many respects, have acted as
an influential force encouraging international growth and consolidation.
As highlighted by some of the earliest work on economics of television,
this is a sector that flouts some of the norms of behaviour in that television
content, like other so-called ‘information’ goods (Withers 2006: 5), has
characteristics that, in economic terms, are quite unusual (Collins et al.
1988; Blumler and Nossiter 1991). As with other informational goods,
the way that viewers derive value from television content is through the
information or the messages being conveyed, rather than the material
carrier of that information (the digital file, the airwaves, etc.). So, because
the main value within content is generally to do with attributes that are
immaterial (i.e. its messages or meanings), it follows that these attributes
do not get used up or depleted in the act of consumption. As a conse-
quence, this is a sector in which economies of scale are present (Doyle
2013). Initial production or ‘first run’ creation costs in television are typi-
cally high but once these have been covered, facilitating consumption of
content by additional viewers and/or audience segments typically involves
relatively low marginal costs. Extending consumption across international
2 INTERNATIONAL TRENDS 25

frontiers may well involve some minor outlays on marketing and distri-
bution e.g. costs of attendance at international content markets such as
MIPCOM, and on dubbing or sub-titling where additional markets have
their own distinctive languages. But replication costs tend to be low so
the wider the audience, the more profitable the content will become.
Therefore economies of scale are a prevalent feature of the business and
there are great natural incentives for the makers and suppliers of tele-
vision content to extend the consumption of their output as widely as
possible, including across national territories (Doyle 2014, 2016). In
short, the economics of production strongly favour extended international
consumption of output, to whatever extent this may be feasible.
Uncertainty about likely demand for an as-yet unproduced item of
content is another economic feature of the television production industry.
As an ‘experience’ good, the extent to which any given television show
might satisfy consumers is a subjective and unknowable matter (Caves
2000). At the same time, the high costs and uncertainties involved in
audiovisual production encourage and indeed necessitate the use of strate-
gies aimed at risk reduction such as repetition and imitation of storylines
or formats that have already worked successfully with audiences (Hoskins
et al. 1997). Another approach towards risk reduction is to adopt a corpo-
rate shape that is conducive to financial success. A vertically integrated
structure, for example, reduces risk by ensuring access to both content
and audiences. Or risk can be reduced by scaling up to a size that is suffi-
ciently large to deploy a portfolio strategy where a number of different
sorts of output are produced simultaneously (Doyle 2013). Production
of television, as with film, is a hit-based business and so companies that
have the scale to mitigate risk by operating product portfolio strategies
will enjoy a competitive edge (Achtenhagen 2012).
The point here is that economic forces based on traits that are funda-
mental to the television industry play a significant part in encouraging
processes of international expansion, consolidation and globalisation. The
presence of economies of scale in any industry acts as a powerful incen-
tivising force that drives tendencies towards corporate expansion and
consolidation of ownership and television production is no exception. The
exact nature of advantages, benefits and economies of scale that accrue
to enlarged, diversified and consolidated television production entities is
examined in depth and detail in Chapters 4 and 5.
26 G. DOYLE ET AL.

However an increasingly internationalised television environment has


highlighted tensions between the globalising aspirations of many produc-
tion companies and the perceived need to protect television systems which
historically, guided by PSB-inflected regulatory frameworks, have been
primarily orientated towards the needs and interests of domestic audiences
(Flew, Iosifidis and Steemers 2016; Straubhaar 2007; Thussu 2006). In
most territories, the preservation of indigenous television production and
associated audience access to locally made content are seen as impor-
tant goals for public policy (Joly 2017; Puppis 2008). But achieving
such goals has become more challenging in the face of trends—evident
across all regions and territories around the world—towards globalisation,
consolidated ownership and ‘the emergence of powerful transnational
platforms commercialising cultural goods and services online’ (García
Leiva and Albornoz 2017: 10). As is demonstrated in Chapters 6, 7 and 8,
the effects of globalisation and consolidation of ownership on processes
of content-making and on international trade in television content are
manifold and complex.
While a comprehensive survey of production in all regions and coun-
tries of the world is well beyond the scope of this study, the following
section provides an outline of major trends and issues in a number of
important territories. The main focus here is on countries other than the
UK—a full analysis of the history of the production sector in Britain is set
out in Chapter 3.

Key Territories
Us
The US always has been and remains the dominant player in the global
television production sphere, both in terms of commercial value and
cultural influence. As was the case in many other territories, the first
US television networks—ABC, CBS and NBC—initially grew from the
radio sector. Michele Hilmes describes how ‘the schizophrenic nature of
US broadcasting split between First Amendment, free-market ideals and
protective social goals, would carry over into television’ (Hilmes 2003:
30). Nonetheless, a license fee system of public funding support for tele-
vision was not considered and so, from the outset, the US television
industry was orientated towards commercial sources of revenue in the
form of sponsorship and advertising.
2 INTERNATIONAL TRENDS 27

Historically the television production landscape in the US was


distinctly different from that of the UK and much of Europe and Asia
where free-to-air public service broadcasters, funded by licence fees and
advertising, conducted the great majority of production in-house. While
US networks produced their own news, sport and other live content,
much of their drama and comedy content has always been produced
out-of-house by producers independent of the networks. Even so, an
oligopoly television market dominated for many years by just three broad-
casters—the ‘Big 3’ networks ABC, CBS and NBC—led to imbalances
in bargaining power between broadcasters and producers ‘that shifted
most of the risks onto external producers - and placed most of the profit
potential in the networks’ hands’ (Hilmes 2003: 47). Such imbalances in
bargaining power favouring commissioning broadcasters over producer
suppliers were to become a familiar feature in other national television
markets later as independent production began to develop elsewhere.
In the US, concerns about the power and predominance of the
three major networks led to the introduction by the industry regu-
lator, the Federal Communications Commission (FCC), of the Financial
Interest and Syndication Rules which were designed to limit the networks’
ownership of secondary IP rights (Potter 2008: 51). The ‘FinSyn’ rules
prevented ABC, CBS, and NBC from producing more than 40% of their
own prime-time (or peak-time) programming in-house. This limitation
forced them to commission at least some of their programmes from
external or independent production companies, often based in Holly-
wood. The idea behind these rules was to counter the dominance of
broadcasters by strengthening the position of the production sector, an
idea replicated later in the UK when a compulsory access quota for
independent productions was introduced via the 1990 Broadcasting Act.
The deficit financing approach generally adopted by the three networks
when commissioning programmes from external suppliers suited larger
and well-funded production companies and studios but was onerous
for cash-strapped smaller production companies (Paterson 2017). Even
so, the FinSyn intervention, which allowed at least some programme
producers a chance to become well-resourced and to develop their repu-
tations as important suppliers of content in the US and beyond, was
effective in boosting the position of the US production industry and
in limiting levels of vertical cross-ownership during the period while the
rules were in place from 1971 to 1994.
28 G. DOYLE ET AL.

However, as the position of dominance enjoyed by the ‘Big 3’ was


progressively eroded from the 1970s onwards by the arrival and growth of
new competitors, particularly cable television and also independent over-
the-air networks, the FCC was persuaded by the mid-1990s to rescind
the FinSyn rules. Expansion in avenues for delivery of television and
growth in subscription payments resulted in vastly increased competi-
tion in the US television industry and in fragmentation of audiences and
declining revenues for the traditional advertiser supported over-the-air
networks (Owen and Wildman 1992; Lotz 2007). But relaxation of the
FinSyn rules paved the way for a restructuring of ownership with several
mergers taking place between the main broadcast networks and indepen-
dent studios, such as Walt Disney’s purchase of Capital Cities/ABC in
1995, Viacom’s merger with CBS in 1999 and Universal’s acquisition of
NBC in 2004. Further phases of mergers, acquisitions and consolidation
in the twenty-first century have reinforced a pattern where television in
the US is once again predominated by a relatively small number of diver-
sified media, telecommunications and television groups who are major
players both in their home market and internationally, such as Comcast,
Disney, Liberty Global and Warner Media.
Television content that is produced in the US, as with US-made film,
tends to export well across both English-speaking and most non-English
speaking markets (USITC 2018). At the same time, major US televi-
sion and media groups have been active in recent years in acquiring
production subsidiaries in other international territories (Esser 2016). For
reasons that are examined in later chapters, the UK sector has proved
especially attractive to acquisitive US conglomerates including Disney,
NBCUniversal, Sony Pictures Television and Liberty Global. Liberty
Global, for example, has a portfolio of more than 20 UK production
subsidiaries secured through its purchase of super-indie All3Media. This
includes one of our case study companies, Lion Television, producer of
the long-running returning series Homes Under the Hammer and Horrible
Histories for the BBC.
Acquisitions have not been confined to television production compa-
nies but include terrestrial, satellite and cable broadcasters, studios and
distribution companies. Liberty Global owns Virgin Media outright while
also holding a minority stake in ITV. Other examples of conglomeration
abound. The sale of subscription satellite broadcaster Sky to Comcast in
2018 following a bidding war between three US companies, Comcast,
Disney and Fox illustrates the appetite amongst major US media groups
2 INTERNATIONAL TRENDS 29

to acquire UK-based and other overseas television companies. Vertical and


diagonal integration in order to control both upstream production and
downstream distribution elements of the value chain is a well-established
strategy in the television industry across the globe, but US companies
have been particularly active in employing this approach.
While much M&A activity has revolved around familiar entertainment
and media industry brands, the emergence and growth of US-based tech-
nology companies—Facebook, Amazon, Apple, Netflix and Google (the
FAANGs)—over recent years presents a direct challenge to the long-
standing predominance of established media and television conglomerates
(Wayne 2018). Of these only Netflix is supplying television content as
its core business but all operate business models which involve accumu-
lating, analysing and exploiting consumer data. The growing centrality of
data analysis, the economic heft, plus the power of the FAANGs to influ-
ence consumer decision-making, including in relation to directing choices
of television content, poses new challenges for media policy-making as it
aims to tackle emerging forms of digital dominance (Hesmondhalgh and
Lotz 2020; Tambini and Moore 2018). The rise of technology companies
has acted as a spur to acquisitions and consolidation as traditional media
organisations in the US, Europe and around the globe have pursued
mergers and partnerships in order to compete with ‘streaming giants’
(Solomon 2020).
For now, the US remains the pre-eminent player in the global television
industries in terms of the scale of its activities and influence. However,
as television content is increasingly consumed in the borderless sphere
of on-demand viewing and via multiplatform delivery systems, it remains
to be seen if this situation will endure. Regional markets for television
content have flourished in recent years, for example in the Far East
and South America, lending strength to Thussu’s ‘contra-flows’ (Thussu
2006). While the US continues to dominate exports, it is notable that
the position of several other countries as exporters has improved signif-
icantly in the twenty-first century (Doyle 2014; WTO 2010). As Esser
observes ‘[m]ore than ever before in the history of television, content
is shared across borders, is originating from a multiplicity of sources
and is spreading across several continents’ (Esser 2014: 88). While US-
originated content continues to dominate including on new platforms
such as Netflix, the advent of wider global availability for audiovisual
products emerging from alternative and smaller markets has influenced
30 G. DOYLE ET AL.

audience tastes and over time this may well pose an increasing challenge to
historic patterns of diffusion typified by largely one-way flows emanating
from the US outwards.

Europe
The television production and broadcasting landscape is hugely varied
across the continent of Europe. Each national system has evolved
according to differing cultural, political and commercial imperatives,
but there are also important shared characteristics. In many cases, the
context in which television production has emerged has been similar to
the UK where the established pattern has involved a mixed economy
of PSB plus commercial broadcast networks. All of the other largest
nations of Western Europe—France, Germany, Italy and Spain—mirror
this broad pattern. European neighbours have cooperated with one
another, for example on policy matters and in terms of development
of co-productions. But the national television industries of Europe also
compete with one other to sell content into and across international terri-
tories. However, despite occasional successes such as Spiral (France) and
Inspector Montalbano (Italy), the larger nations of Western Europe other
than the UK have achieved only limited success as exporters of television
content.
Most Western European countries, particularly France (Miller 1993),
share concerns about the implications for their respective cultural
economies of imbalances in trade in audiovisual (film and television)
content and about the possible effects on languages and cultures of exces-
sive audiovisual imports. While Britain has at times been regarded as
an ‘awkward partner’ in discussions about collective European measures
to protect culture, political support for action to protect and boost
the position of domestic programme-makers has more generally across
Europe remained robust (Collins 1994). Shared concerns about the need
to counter the effects of globalisation and of the dominance of US
audiovisual suppliers have paved the way for protective policy interven-
tions at national and collective European levels, such as quotas requiring
broadcasters to screen a minimum proportion of locally made content
and subsidies for local production sectors. Support for local produc-
tion is seen partly as a necessary counter-measure to the potentially
adverse effects of cultural imperialism and partly as a means of protecting
national producers who otherwise would struggle to compete in the
2 INTERNATIONAL TRENDS 31

global marketplace against much larger international rivals (Broughton


Micova 2013).
Although definitions of the term ‘independent’ vary across Europe
(Medina 2004), adherence to the idea that local and independent tele-
vision production should be protected is widely shared. This is reflected
in a plethora of national policy measures whose aim is to support and
protect indigenous production within each of Europe’s largest televi-
sion markets (EAO 2019). In addition, at collective European Union
(EU) level, the Audiovisual Media Services (AVMS) Directive requires
that a majority of transmission time on broadcast channels in all member
states is preserved for European-made works and that a minimum of
10% of transmission time is devoted to independent productions (CEC,
2018). Levels of compliance vary from country to country and in prac-
tice member states tend to satisfy the requirements of the Directive
by producing domestic nationally focused content as opposed to mate-
rial aimed at pan-European audiences (Broughton Micova 2013: 256).
However, partly on account of language factors, few of the other large
countries of Europe other than the UK have succeeded in becoming
major international exporters of television content. Although European-
made television content often permeates across overlapping (usually
neighbouring) language areas within Europe, the UK’s experience of
selling finished television programmes and formats much more widely to
markets around the globe is unmatched by that of other major European
countries.
Indigenous independent television production has been nurtured and
supported in most of Europe’s major markets and frequently the espoused
motive for this has been in order to promote diversity (Albornoz and
García Leiva 2019). In France, inclinations to protect culture in face of
growing trends towards internationalisation of television have been espe-
cially strong (Kuipers 2011) and protectionist instincts are evidenced for
example by levies to support national audiovisual production and by high
quotas for locally made and French-language content which are strin-
gently enforced (EAO 2019). By contrast in Italy production of television
has developed in a less protectionist environment where the national
cultural space is ‘relatively porous and open to the influence of foreign art
forms and media products from the very beginning’ (Buonanno 2015:
195). In Germany, where the emergence and growth of independent
production took place later than the UK and similarly was helped along
by a series of domestic policy interventions, promoting efficiency and
Another random document with
no related content on Scribd:
Falsehood and Wickedness

AFTER good old father Noah had completed the building of the ark, the animals were
gathered together near it by the angels appointed over them. They came in pairs,
and Noah stood at the door of the ark to see that each one entered with its mate. As
soon as the waters of the flood rose upon the surface of the earth, the children of
men hid themselves in their homes for safety. All traffic and business ceased, for the
angel of death was abroad. This state of affairs caused Falsehood to realize that
henceforth there was no chance of her plying her trade. Was it not quite evident that
the ever-increasing waters of the flood would soon sweep away the wicked folk
[20]whohad rebelled against their Heavenly Creator? Where should Falsehood
betake herself for safety?

Forthwith she hastened to the ark, but its door was shut. What was to be done?

Falsehood knocked at the door with trembling hand. Noah opened the window of the
ark, and put out his head to see who was knocking. It was a strange creature before
his door. Noah had never seen her before, because he was a righteous man who
never told lies.

“What dost thou want?” he cried.

“Let me come in, please,” she replied.

“Gladly,” cried Noah, “would I admit thee if thy mate were with thee, for only pairs are
admitted here.”

In grief and disappointment Falsehood went away. She had not gone a few yards
before she met her old friend Wickedness, who was now out of employment.

“Whence cometh thou, dear friend Falsehood?” asked Wickedness.

“I come,” said Falsehood, “from old father Noah. Just listen. I asked him to let me
come into the ark, but he refused unless I complied with his rules.”

“What does he require?” asked Wickedness.

“The good old man stipulated that I must have a mate, because all the creatures
admitted [21]into the ark are in pairs,” Falsehood replied.

“Now, dear friend, is this the truth?” queried Wickedness with a merry twinkle in his
evil eye.

“Of course it is the truth, on my word of honour,” rejoined Falsehood. “Come now,”
she added, “wilt thou be my mate? Are we not just fit to be joined together, two
honest and poor creatures?”

“If I agree,” said Wickedness, “what wilt thou give me in return?”

Falsehood thought awhile and with a cunning look at her friend she exclaimed,—

“I faithfully promise to give to thee all that I earn in the ark. Have no fear, I shall do
excellent business even there, because I feel very fit and energetic.”
Wickedness agreed to the terms immediately, and there and then a proper
agreement was drawn up, and duly signed and sealed. Without further delay they
both hastened to Noah, who readily admitted the happy pair.

Falsehood soon began to be very busy and earned good money. She often thought
of her agreement with Wickedness with regret, as she realized that she alone did all
the business. She even said to him one day,—

“Look here, how easily can I carry on my trade single-handed?”

He merely reminded her of the agreement, [22]and day by day he wrote down in his
ledger the sum total of the day’s takings.

At the end of the year, for the flood lasted twelve months, they came out of the ark.
Falsehood brought home much treasure, but Wickedness came with her and claimed
the whole of the hard-earned fortune. Thereupon Falsehood said to herself, “I will ask
my mate to give me some of my earnings.”

She approached Wickedness and in a gentle voice said,—

“Dearest friend, please give me a share of what I have so honestly earned, for I alone
did all the work.”

Wickedness looked at her in contempt and with harsh voice cried aloud,—

“Thy share is nought, O cheat! Did we not solemnly agree that I was to take
everything which thou shouldst earn? How could I break our agreement? Would this
not be a very wicked thing to do, now would it not?”

Falsehood held her peace and went away, well knowing that she had been foiled in
her attempt to cheat her friend Wickedness. True indeed is the proverb: “Falsehood
begets much, but Wickedness taketh all that away.”

(Yalḳuṭ, Psalms § 638.) [23]

[Contents]
THE WICKED KING AND HIS BRIDE

[24]
THE QUEEN SPRINKLING THE WATER OF LIFE ON
CHANINAH.

[25]

The Wicked King and his Bride


LONG, long ago there lived in the Holy Land an old peasant and his wife. They had
an only son who was also married. The family all lived happily together in a little
house in a village near Samaria. The son, whose name was Chaninah, was a very
good man, deeply learned in the Holy Scriptures and the ancient lore of Israel.

In course of time the old father, feeling his end drawing near, called his beloved son
to his bedside and said to him,—

“Hearken, my son, to the words which I am [26]about to speak. Your mother and I will
soon die. After our death and burial you will observe the customary period of
mourning and lamentation. On the day following go to the nearest market-place and
buy the first thing offered to you, be the price what it may. I also charge you to
continue the study of the Holy Word of the Bible by day and by night, keep the Divine
Commandments, support the poor and be kind to the dumb creatures.”

After he had spoken these words he blessed his son and closed his eyes in the sleep
of death.

Chaninah went to tell his mother of the death of his father. The sad news was too
much for the poor woman and the shock killed her instantly. The pious son buried his
beloved parents in the village cemetery and returned home to keep the customary
period of mourning and lamentation, which lasted seven days.

Mindful of his father’s dying words, Chaninah went on the following morning to the
nearest market-place. One of the merchants, carrying a beautiful silver casket in his
hands, came to him and said,—

“Will you buy this casket?”

“What is the price?” asked Chaninah.

“I will take eighty pieces of silver for it,” answered the merchant, and he added, “I will
not accept any less.” [27]

Chaninah agreed, and there and then paid the large sum of money demanded,
thinking all the while of his dear father’s last wish. The money which he had spent in
buying the casket was nearly all the fortune he possessed.

Without any further delay he returned home with his purchase, which he was anxious
to show to his wife.

“Look here,” he cried, “I have spent nearly all our money in buying this casket, even
as dear father told me to do just before he died.”
“Open it,” said his wife; “there is sure to be something very valuable inside it.”

He lifted the lid of the casket and was astonished to find that it contained another
silver box. He took this out and opened it, curious to learn what was inside. To their
great surprise a little green frog leapt out.

“Well, I never,” cried Chaninah, “this is an expensive creature.”

“Do not forget,” his wife said, “your father’s command to be kind to the dumb
creatures.”

“Quite right,” says her husband, “we will provide for the frog even as though the little
fellow were one of us.”

The frog grew larger and larger and the silver box was no longer large enough for its
quarters. Chaninah therefore made a nice roomy cupboard for their new friend’s
abode. After a [28]while the wife told her husband that there was no more money left
to buy food. With a very sad heart the good man called the frog to his side and said,

“I am awfully sorry to tell you, dear little friend, that we cannot feed you any longer
because we have no food left even for ourselves.”

“Please don’t worry,” cried the frog, “I hope you will believe me when I tell you that I
am indeed more than grateful to you both, for all your kindness and hospitality. Let
me prove my gratitude by giving you this piece of advice. In the box where you found
me, you will see a strip of parchment. If you place it in the fold of your turban you will
be able to understand not only the different languages of mankind but also the
speech of birds, fish and beasts.”

Chaninah did exactly as the frog told him, and calling his wife told her that they would
accompany the frog to his new home wherever it might be. The frog said this should
be in a pond in the wood near by.

They all went to the wood feeling sad that poverty was forcing them to part company.

As soon as they came to the wood the frog told them to rest themselves. Then at the
bidding of the frog, the birds and beasts in the wood brought to Chaninah and his
wife an immense [29]quantity of valuable gems and an assortment of roots and herbs.
The kind-hearted frog gave these gifts to his good friends, explaining how the herbs
and roots were to be used for healing purposes. Then at last the frog bids his friends
farewell and tells them that he was really a son of Adam and the demon Lilith, and
that he had the power of changing himself into any shape.
Chaninah and his wife gathered up the precious gems, roots and herbs and returned
home. On the way they met a caravan and offered some of the gems for sale. A good
bargain was struck and Chaninah and his wife found themselves with plenty of
money. They left their old home and bought a nice house. Riches did not spoil them,
for their hearts were kind. Moreover Chaninah kept faithfully the charge of his
beloved father. He studied the holy words of Scripture by day and by night and
observed the Divine precepts with a good will. Their home was always open to the
poor. The good fortune of Chaninah spread far and wide. His reputation as a
charitable man reached the ears of the King who invited him to visit his Court.

The King took a great fancy to Chaninah and persuaded him to take up his abode in
the palace. The King was by no means a pious [30]man, in fact he was very wicked
and cruel. He was unmarried, and this fact alone displeased his subjects. His
counsellors urged him to find a good wife, saying to him,—

“Let us, O King, remind you that we require not only a king but also a queen and little
princes; for there will surely come a time when a new king will have to be found—
because kings and queens are mortals and they cannot live for ever.”

They did not tell the King what their real motive was in advising him to marry. They
thought that if the King were to find a true and good wife it might be possible for her
to use her influence and make him a better man.

The King dismissed his counsellors, promising to see them again in a week’s time,
when he would tell them whether he would marry or not. When they came to the
palace at the appointed time the King’s valet met them and told them that His Majesty
would receive them in the palace garden.

They went there and found the King sitting on his throne. As they approached he
rose up and bade them welcome. At that moment a beautiful bird flew over the King
and dropped a long golden hair upon his shoulder. The King took the hair in his hand
and turning to his counsellors said,— [31]

“I will marry only the maiden to whom this golden hair belongs. No other wife shall be
mine. You wish me to marry—well and good—so be it. I now command you to
discover the owner of this golden hair, and mark you, if you do not bring her to me
within a year from to-day I will have you and all your families put to death.”

The counsellors were greatly distressed at the turn of events. They feared that their
lives would be forfeit. How were they to find the lady whose golden hair had brought
misfortune to them and their families? With sad hearts they left the royal presence,
and when they were outside the palace they asked one another, “What is to be
done?”

Chaninah, who was now one of the King’s counsellors, offered to find the lady
destined to be their queen. He hastened home to bid his wife farewell and to prepare
for his journey. He took a bag into which he put six loaves, a small assortment of his
precious herbs and roots and twelve silver coins. Having blessed his wife he set out
on his quest.

He walked during the best part of the day and at sunset, feeling very tired, he sat
down on a large stone beneath a tree. He was just about to doze off when he was
suddenly startled by hearing a raven’s croak. He listened and [32]understood that the
bird had not found any food for three days. He at once opened his bag and gave the
raven a large piece of bread. On the morrow Chaninah met a dog howling miserably.

“Come and tell me,” he said to the dog, “all your troubles. I understand the speech of
beasts and birds.”

The dog said that he was very ill and hungry, for it was just a week since he had
eaten any food. Chaninah gave him one of the healing roots and a loaf of bread. The
dog devoured the bread and ate the root and thanked his good friend.

Next day Chaninah came to a river and found some fishermen trying in vain to pull in
their net, which contained a large fish. The fishermen pulled so hard that they feared
their net would break. Chaninah lent them a willing hand and then they were able to
pull in the net. The fishermen shouted with joy,—

“We have enough now for dinner to-day and to-morrow.”

Chaninah asked them to sell the fish and he would give them twelve pieces of silver
as its price. They agreed and gave him the fish as soon as he had paid them. They
could hardly believe their eyes when they saw Chaninah throwing the fish back into
the river. [33]Bidding them farewell he continued his journey.

At last he came to a large town where, unknown to him, dwelt the maiden whom he
was seeking. She was a princess, the only daughter of the King of that country.

Chaninah came to the courtyard of the palace and stood still awhile gazing around.
The Princess was looking out of the window of her room, and saw Chaninah, whose
strange attire attracted her attention. She sends her chamberlain to bring him to her
presence.
In reply to her inquiry as to the why and wherefore of his visit to her father’s land,
Chaninah tells her the story of his quest. Looking at her he sees that she is the very
lady whom he has to find to be the wife of the King, his master, for her tresses were
golden even like the hue of the hair which the King found upon his shoulder.

“Come, good lady, with me,” he cries, “and save my people, the wise men of Israel
and their families, who are in mortal danger. Come and be Queen in our land and
save the soul of our lord the King.”

The Princess had listened very attentively to all the strange story told by Chaninah,
and in reply she said,—

“Well do I remember drying my hair one day [34]last month in the garden of our
palace, and whilst doing so a strange bird flew over my head three times and then
plucked out one of my hairs. He flew away with the hair and I can now believe that
this is the very bird which brought my hair to the King of your land. I will accede to
your wish and consent to become the Queen of your land if you fulfil two tasks which
I will set you. The first I will mention at once. Here I have two empty flasks. You must
bring them back to me full of water. I do not mean the water of the brook or well, but
the one flask must contain water from Paradise and the other must be filled with
water from Hell. When you have done this task I will tell you all about the second
one.”

With a kind word of farewell the Princess dismissed Chaninah. He left the palace with
a sad heart and prayed to God to help him in his difficulty. Was he not trying to save
the lives of his brethren in the Holy Land?

After a little while he hears the croak of a raven speaking as follows:—

“Dear friend! do you no longer remember me? Did you not give me bread when you
met me? I was so hungry then, for I had not tasted any food for three days. Now just
tell me, How can I be of service? I will gladly do my best to please you.” [35]

Chaninah told the raven all about the task which the Princess had set him to do.

“Here are the flasks,” he said; “one must be filled with water from Paradise and the
other must be filled with water from Hell.”

The raven told him to tie a flask to each wing and at sunset to be at the spot where
they were conversing. The raven flew to the netherworld and singed his wings in
passing through the flames of Hell. At last he reached the black boiling waters in the
centre of Hell and filled one flask. He then flew to the gates of Paradise and found
the spring which flows from its midst and bathed in its cool water to heal his wings.
He then filled the other flask and flew to the spot where he had arranged to meet his
friend. He gave the flasks filled with the desired water to Chaninah, who returned to
the palace and told the Princess that the task was done.

The Princess was in doubt whether the water of each flask was genuine. She
proposed to test the contents there and then. Opening the flask containing the water
from Hell, she poured a few drops upon the palm of her hand. The water burnt her
skin and she quickly put some of the water of the other flask upon the burnt spot and
healed it at once. She told Chaninah that she was quite satisfied with this
performance. [36]

“But now,” she said, “you have to perform a much more difficult task. Just listen.
Some years ago I was playing with my ring in a boat and by accident I dropped it into
the water. It was a golden ring with my initials engraved on the gold and set with a
beautiful pearl. Restore this ring, and when I have it again I will comply with your
request.”

The Princess thought that it would be impossible to find her ring and that she would
not be bothered to accede to the wish of Chaninah. She again dismissed him with a
few kind words and told him not to be disappointed if he failed to find the ring.

Chaninah at once turned his thoughts to God and prayed for Divine help. He then
went to the nearest river, hoping that his good fortune would not forsake him. As
soon as he came to the water he beheld the large fish which he had purchased and
thrown back into the river.

“Tell me,” said the fish, “what you desire, and I will try to help you.”

Chaninah told the fish the story of the ring of the Princess, and said that he must
have this ring as soon as possible.

“Meet me at yonder bridge,” said the fish, “to-morrow morning at daybreak and I will
bring you news concerning the ring.”

The fish then swam away and made for the [37]bottom of the great sea in order to
seek the help of Leviathan, the monster king of the deep.

Leviathan welcomed the fish, and having heard his story promised to help him. He
issued an order throughout his vast kingdom compelling every fish to report to him if
any such ring had been heard of or discovered. If he should discover that a fish had
the ring and failed to produce it, very severe penalties were sure to follow. Within an
hour the ring was brought to the palace of Leviathan and placed before his throne.
Leviathan then gave it to the fish which had promised to help Chaninah.
Next morning at daybreak the fish delivered the ring to Chaninah, who rejoiced
greatly at the cleverness of the fish. How glad he was that he had fulfilled his dear
father’s wishes in being kind to birds, beasts and fish.

At noon Chaninah entered the palace and was brought at once to the Princess.

“Behold,” he cried in a joyful voice, “your Royal Highness! is this not your ring? Your
initials are engraved on the gold.”

The Princess admitted that this was her ring, and as the two tasks, which she had
imposed, had been satisfactorily accomplished, she now consented to accompany
Chaninah to the Holy Land.

On the way they were attacked by robbers. [38]Chaninah, fearing that he would be
overpowered, called for help. At that moment a dog ran up to his side and barked so
furiously that the robbers made off. The dog was glad to repay Chaninah for having
fed him and healed him in days gone by.

At last they came to the Holy Land, and when the King saw the beautiful princess
with the golden hair he was very happy. Amidst general rejoicing the royal wedding
took place. The King rewarded Chaninah by making him his chief counsellor of State.
The good man’s success, however, was marred by a great misfortune which had
befallen him during his absence. His good wife had died. Moreover, some of the royal
servants were envious of his advancement in the King’s favour. They resolved to hire
some ruffians who were to waylay him. One day as he was leaving the palace the
ruffians attacked him and killed him in the courtyard. As soon as the news of the sad
event was told to the Queen, she cried,—

“Never mind! let me see what can be done.”

She went to her cabinet and took out the flask containing the water from Paradise.
She then went to the courtyard where the King and nobles were gathered around the
corpse.

“Make way for Her Majesty the Queen!” the people cried. [39]

When the Queen saw the dead body of her friend she smiled. All eyes were fixed on
her. She sprinkled some of the precious water upon the corpse and immediately
Chaninah opened his eyes and arose. Now the people understood why the Queen
had smiled.

“Come now,” said the King to his wife, “kill me and restore me to life again. I should
just like to know how it feels to be dead.”
The Queen declined to murder her husband, and turning to him she cried,—

“Do not be so wicked. Life is sacred. Moreover, the wonderful water will only bring a
person back to life provided his life had been good.”

“Your Majesty,” she added, “must repent and mend your ways, otherwise you will not
be restored to life in the hereafter.”

The King went away in anger and returned to his royal apartments. Here he ordered
one of his servants to kill him.

“If you refuse,” cried the wicked King, “I will instantly kill you.”

Whereupon the servant obeyed the King and slew him.

The Queen was at once informed of the wicked death of the King. She was truly
sorry to find that he had not allowed himself to be influenced by her advice, but that
he had [40]trifled with his life. She therefore fetched the flask containing water from
Hell. Then she sprinkled its contents upon the body of the wicked King. His body
immediately was burnt to ashes. She thereupon turned to the astonished members of
the Court who were looking on, and in a gentle voice she said,—

“Do you not see, good friends, that if my husband had been a good and holy man he
would have been restored to life, just like Chaninah. But the fact is that he was a
cruel and bad man. You all knew this even before I came here from my father’s land.”

After the burial of the King, the counsellors came to the Queen and urged her to
marry Chaninah, who had proved such a trusty friend. The suggestion pleased the
Queen, who gladly gave her heart and hand to the good man. They ruled the people
in justice and kindness, and as long as they reigned there was peace in the land.

(From the Jewish Chap Book, Ma’aseh Book, § 143.)

[41]
[Contents]
THE TWO JEWELS

[43]

The Two Jewels

IN the early period of the Middle Ages there was a King of Spain, Pedro by name. He
was a wise and tolerant ruler. In his kingdom Christians, Jews and Mohammedans
were to be found. It was a time when brotherly love was to be discovered in the Holy
Scriptures only.

King Pedro was one day about to set out at the head of his army to attack his
enemies in a neighbouring land. Nicholas of Valencia, one of the royal counsellors,
came to Pedro and exclaimed,—

“O most gracious sire! May I ask your Majesty a question?”

“Ask, good friend Nicholas,” said the King.

“What need is there for your Majesty to leave your kingdom to fight your enemies
beyond the border, when you have so many dangerous enemies within your
kingdom?” [44]
“To whom do you refer?” cried the King.

“I refer to all disbelievers in Spain, the heretics, the Jews and the followers of
Mahommet—people who deny the divinity of our Lord, our Saviour, and His Holy
Mother. Do we not, as good Christians, hate the Jews and Moslems and do they not
hate us? Does not your Majesty know that the Jews are commanded in their holy
Bible to abstain from greeting the Christians?”

“How can that be true,” said the wise King, “since the Hebrew Bible was written at a
time when there were no Christians?”

“Nevertheless,” continued Nicholas, “I have heard it said, that even though a Jew
would greet a Christian saying to him, ‘Peace be unto you,’ he immediately adds
under his breath, ‘but may the Devil take you.’ ”

“How do you know this?” exclaimed the King in astonishment.

“I was told this,” replied Nicholas, “by a most saintly man, one Geronimo, a converted
Jew.”

“No, no,” interrupted Pedro, “I would not believe such a man. Any one who changes
his religion will not scruple to change his word, twisting the truth into falsehood. Do
you not also realize that the testimony of such a convert is probably unreliable,
because he is now [45]anxious to show how intensely he loves his new faith, and this
he does best by hating the religion which he has abandoned?”

“Your Majesty may be right,” said Nicholas, “but,” he added, “there is nothing which
vexes my soul so much as the unbounded impudence of the Jews, who would not
hesitate to tell your Majesty that their Religion is better than our Holy Faith.”

“Do not let this vex you, good Nicholas,” said Pedro; “prove your statement by
bringing a Jew before me and let me hear from his own lips this glorification of his
religion, and then I will tell you whether I feel vexed or not.”

Nicholas left the King in order to fetch a Jew as commanded by his royal master.
After a few minutes had elapsed, he returned, bringing with him a venerable man
with a long beard, white as the driven snow.

“Welcome!” exclaimed King Pedro; “be seated, noble Jew, and answer me without
fear or favour any questions I may put to you.”

“May it please your Majesty,” said the Jew, who had risen from his seat when about
to speak, “life is dear to me and mine, but truth and honour are dearer still. For nearly
ninety years have I remained steadfast to the faith of my fathers. I most humbly beg
your Majesty to suffer me and my people to continue to be [46]loyal not only to God,
our Heavenly King, but also to your Majesty.”

“Have no fear, good Jew, but now tell me your name,” says King Pedro.

“I am called,” he replies, “Ephraim, the son of Sancho.”

“Now will you tell me,” asks the King, “which religion, Judaism or Christianity, is more
true and real?”

After a moment’s thought Ephraim replies,—

“My religion is the only good one for me in view of my circumstances. Your Majesty
knows that my ancestors, the children of Israel, were once slaves in the land of
Egypt. God in His great mercy redeemed my people from that land of bondage with
signs and wonders. My religion is bound up with this wonderful love of God, who not
only redeemed us, but He also gave us our laws and commandments. In keeping
these laws and commandments we serve God, and this is our religion, and it is the
most natural for the people of Israel. For your Majesty, however, who is born to rule
nations and creeds, your religion is the most suitable, because Christianity is the
predominant faith which has cramped my religion in Ghettos and darkness.
Christianity has even resolved in this land to drive out the Mohammedans, so [47]that
a believer in the Koran shall not be found in Catholic Spain.”

“You have spoken wisely and daringly,” says the King, “but I did not ask you to
discuss the various religions from the point of view of the individual believer, but I
wished to know which religion, in your opinion, is the best. You can limit your reply by
discussing whether Judaism is better than Christianity, or, as we think, vice versa.”

Ephraim replied,—

“In three days’ time, if it please your Majesty, I will return and give you my humble
opinion. I cannot promise to satisfy your Majesty, but I will do my best to justify my
conscience.”

The King consented to this proposal, and dismissed the Jew with a friendly farewell.

Three days later the King and Nicholas were anxiously awaiting the promised reply.
At the hour appointed, Ephraim appeared. He was very much agitated and gasped
for breath.
“Most heartily welcome,” cries Pedro in his most friendly voice; “come and sit near
my throne and tell me your answer to my question.”

Ephraim sat in silence and failed to control his agitation.

“What is the matter, good Ephraim?” asked the King, who was now beginning to feel
concerned [48]at the Jew’s prolonged silence and unusual excitement.

At last by a great effort Ephraim exclaimed,—

“I grieve to tell your Majesty that I am ill. I have this day been most grossly insulted
and abused. I am perfectly innocent of having done any wrong to the men who have
been so cruel and unjust to me. Gracious King! I appeal to you to hear my complaint
and to see that justice is done.”

“Have no fear,” cried the King. “I am the fountain of justice, and every one in my
realm may look to me for impartial judgment. What is your complaint?”

The King and Nicholas turned to Ephraim and anxiously awaited his reply.

“My story is as follows,” says the Jew. “A month ago my neighbour went away from
home on a very long journey. In order to give some comfort and consolation to his
two sons during his absence, he gave a precious jewel to each of them. Early this
day the two sons of my good neighbour came to my house and asked to see me. I
received them very politely in my humble apartment and asked them how I could be
of service. They showed me their jewels and demanded that I should there and then
explain to them both the various characteristics of the gems. I was also to point out
the beauties [49]and flaws—if any—in the precious stones. They asked me to
appraise their value and to decide which of the two was the better and the more
valuable. I told them that there was no one so well qualified to answer all their
questions as their dear father who happens to be an eminent authority on gems, for
he is a jeweller. ‘Go,’ I said, ‘to your beloved father and let him decide, for he will tell
you all you desire to know about the jewels, and whatever he tells you will be right
and true.’ No sooner had I said this, when the two sons attacked me, striking me
upon my head. They abused me, calling me ‘heretic and Jew,’ just because I tried to
answer their question to the best of my ability.”

“Truly,” cried the King in a passion, “they have acted most shamefully; they deserve
to be most severely punished.”

“Listen, O sire, to the words of your mouth,” rejoined Ephraim. “Two brothers were
Esau and Jacob, and to each one did their father give a precious jewel. Now your
Majesty likewise asks me to decide which is the better? Let your Majesty send a
messenger to our Father in Heaven, for He is the greatest owner of jewels, and He
will be able to explain exactly how the two jewels differ, and He will also tell your
Majesty which of the two is the more precious.” [50]

With a smile on his face, King Pedro turned to Nicholas and said to him,—

“Do you not see how wisely this learned Jew has answered my question? He
deserves to be rewarded not only for his wisdom but also for his toleration, for he
implies that our religion and his own have both been given to humanity by our
Heavenly Father, who, in His own good time, will decide which is the best religion.
Meanwhile, let all men, be their faith what it may, learn to be brothers and friends,
trusting that the time may come when love and charity will lead every one to the
truth.”

Shebet Jehudah, pages 53, 54 (ed. Wiener).


[51]

[Contents]

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