Hollywood's ties with Silicon Valley threaten to squeeze out the British media

With the passing of another year of the internet age, the great powers of Hollywood and Silicon Valley have become more closely entwined and British media is at risk of becoming a sideshow.

Disney has doubled its original $200m (£184.1m) investment in the online youth brand Vice Media (which also has money from 21st Century Fox). The House of Mouse, alongside Hollywood talent agency Creative Artists Agency, recently sunk big money into Jaunt, a virtual reality company, while stars from Ashton Kutcher to Kim Kardashian put cash into start-ups and apps.

“I feel like these worlds are so merged over the past few years,” cooed the singer and actress Jennifer Lopez, as she pitched business ideas to venture capitalists in San Francisco in May.

To some, it’s less of a merger than a takeover by the tech sector of the old studio and entertainment powerhouses.

“Move over Hollywood. Silicon Valley rules pop culture,” as Forbes magazine recently defined the old rivalry.

Netflix, Amazon and Apple are starting to dominate television as content creators as well as platforms. Younger viewers head to YouTube and Instagram. Facebook and Twitter have become many people’s key sources for news.

Whether they are coming together by alliance or conquest, the once radically different corporate cultures of tech and Tinseltown are finding common ground.This has major consequences for media organisations in the United Kingdom as they try to operate on a global scale.

At the start of the millennium, before the internet’s impact had been accurately gauged and ahead of the advertising crash that came with economic crisis, British media had bounce in its stride. The BBC bowed to no one as an international news and entertainment brand. Commercial broadcasters were churning out global hit formats, from ITV’s Who Wants to be a Millionaire? to Channel 4’s Wife Swap. Fleet Street, rumbustious and diverse, did not know what was about to hit it.

The British media stumbles into 2016 with its confidence undermined and its future still in doubt.

Rather than positioning itself to take on global rivals, the BBC has spent much of the past five years guarding its back from domestic enemies. The broadcaster’s funding mechanism – and, with that, its very existence in a form we recognise – has been called into question.

Although rivals will not admit it, successive financial cuts have left the BBC weakened. The consequent shortcomings in its output range from a more cautious commissioning strategy to an embarrassing paucity of sports rights.

Jeremy Tunstall, emeritus professor of sociology at City University, London, has been monitoring media power bases for 40 years. In 1977, he wrote a book, The Media Are American, based on the idea that most forms of mass communication were industrialised in the US. The theory, obvious as it seems now, was controversial then.

In 2007, he followed up with The Media Were American, which recognised the rise of mass media in fast-growing nations such as China, India, Brazil and Russia. He argues that US media giants remain dominant in countries with populations of less than 100 million, including Britain.

“[British media is] probably never going to be 100 per cent American-owned but it’s following European media in being increasingly reliant on American imports.”

Tunstall’s latest book, BBC and Television Genres in Jeopardy, suggests that seven areas of British television (natural history, arts, education, children’s, religion, science and current affairs) are in decline. Faced with competition from global tech giants, the BBC is challenged like never before, he says.

“It has had to defend itself its entire life but the rivals it now faces are getting bigger at an amazing speed.”

Channel 4 faces privatisation by the Government and could follow Channel 5 (bought by Viacom in 2014) in being acquired by American owners. ITV, having seen off the advertising crisis and built an impressive production portfolio in the US, might go the same way.

John Malone’s American cable TV giant Liberty Global last year bought a stake in ITV and already owns Virgin Media. Discovery’s purchase of All3Media is one of several US acquisitions of major British independent producers.

Tunstall estimates that when cartoons, movies and other imported shows are included, 50 per cent of British TV is in US “ownership”.

Sky’s sprawling complex on the outskirts of London is an impressive sight: a money-spinning British success story. But its largest shareholder is, of course, 21st Century Fox. James Murdoch, the Fox CEO, covets the rest, saying partial ownership of the satellite broadcaster is “not an end state that is natural for us”.

In the minds of many, the Murdochs remain the first family of British media. Its News UK owns the biggest-selling quality title, The Sunday Times, and the highest-circulation tabloid, The Sun.

It goes on. Reuters, founded at London’s Royal Exchange in 1851, is run by a company based in New York. Music industry “pluggers” complain that British commercial radio stations are dominated by American R’n’B and pop.

And this is the crucial point. It’s not foreign ownership we should fear but a decline in quality, home-grown content.

Considering the major contribution that creative industries make to the economy, they deserve greater public support.

Yes, that must be earned. But there is still much to be proud of. As Tunstall notes, drama is thriving on British TV. The BBC’s success in the Christmas ratings was on the back of bumper audiences for period productions The Abominable Bride – the latest Sherlock outing – And Then There Were None and Dickensian, as well as the nostalgic sitcom Still Open All Hours. Domestic audiences love this content as much as bingeing on whole seasons of Narcos on Netflix or Transparent on Amazon Prime. Foreign-owned broadcasters must appreciate that.

The Government has belatedly woken up to the value of BBC output overseas and found extra money for the World Service. And UK music-industry bosses, such as Universal Music’s David Joseph, have endorsed BBC Radio’s role in supporting British artists.

The British press was back to its best covering the Paris attacks, with boosts for print circulations as well as web traffic. The Daily Mail’s MailOnline site now reaches 14.6 million users a day. The Guardian and The Independent sites have grown by 50 per cent in the past 12 months.

The press in other European countries can only dream of such success, which should be a source of national pride.

British papers benefit greatly from transatlantic cultural ties and a common language, but that means that they, too, are drawn to US audiences and subject matter.

The lingua franca of social media is not English but American English, with young international users drawn to the “She be like …” dialect that rules online. Combine that power with the seductive and generations-old lure of Hollywood and it’s easy to see how home-grown British content could become even more squeezed out as media evolves.

Only the public can decide otherwise.

Whether or not the second part of the Leveson inquiry takes place, the phone-hacking scandal and newspaper practices will remain in the public eye.

First, there are George Clooney’s movie plans. The actor will direct the film version of the book Hack Attack by Guardian journalist Nick Davies, who exposed the affair. Anthony McCarten, who wrote the hit Stephen Hawking film The Theory of Everything, has reportedly been approached to do the script. Sony is no doubt hoping to turn the film into an All the President’s Men blockbuster for a new generation – though it’s hard to see the Fourth Estate emerging in quite the same positive light.

Second, the BBC has commissioned a six-part drama called Press, written by Mike Bartlett, creator of the BBC’s Doctor Foster. “From exposing political corruption to splashing on celebrity scandal, editors and journalists have enormous influence,” says Bartlett. “Yet recent events have shown there’s high stakes and life-changing drama going on in the news organisations themselves.”

The six-hour story is billed – ominously for the press – as a “behind-the-scenes story about a group of diverse and troubled people who shape the stories and headlines we read every day”.

Getting inside the head of Fleet Street might be harder than Mike Bartlett (see above) imagines. While floods destroyed homes over the Christmas period, some red tops found other distractions.

Days before forcing the suspension of Labour MP Simon Danczuk for “sexting” a teenager, The Sun bizarrely splashed on “White Xmas” revelations of cocaine traces in church toilets. The paper’s “investigator”, Matt Quinton, dutifully swabbed toilet seats and cisterns for “tell-tale blue blotches” to detect the drug. The tests were “95 per cent accurate”, readers were assured.

One cocaine-tainted toilet was at the east London church used to film the BBC series Rev. The Sun noted that two characters in it were “derelicts who use drugs”.

The Daily Star’s notion of Christmas spirit was a Dickensian obsession with spectres. On Tuesday, as inundation beset the North, it splashed on a blurred photo of a “black-eyed ghost girl” taken at Hampton Court by a visiting coach driver. Two days later, as the paper mourned the passing of Motörhead’s Lemmy Kilmister, it led on the rocker’s supposed last vow: “I’ll come back as a ghost.”

Twitter: @iburrell