A damning online video and a speech by the ABC managing director have again put scrutiny on the disastrous commercial deal the national broadcaster struck over the rights to animated phenomenon Bluey.

Australian entrepreneur Charlie Gearside estimates the ABC forfeited an amount worth twice its annual funding when it gave the BBC merchandising rights to animated children’s series Bluey.

In a video posted on social media this week, Gearside, who co-founded digital health start-up Eucalyptus, described the deal as “the sh–test ever”.

“We’re acting like we’re incredibly proud of Bluey’s success, which we are, but it’s also super embarrassing,” he said.

Bluey – which follows a blue heeler pup and her Queensland-based dog family – has become a global phenomenon viewed in 140 countries. Last year, it was the US’s most-streamed show.

The ABC allowed BBC Studios to secure distribution and merchandising rights to the series – created by Brisbane’s Ludo Studios – in 2017 while Michelle Guthrie was chair.

Gearside estimated Bluey could be generating in as much as $2.5 billion for the BBC each year.

Speaking at the first day of the annual conference of Screen Producers Australia, ABC managing director Hugh Marks highlighted the broadcaster’s misstep in failing to do a deal to keep a stake in Bluey IP rights.

“We’ve spoken a lot about Bluey since I arrived [at the ABC], and we can all look back as to what happened in that particular situation,” Marks was quoted as saying by Mumbrella.

“There are always reasons why things happen. But that’s probably $300 million of income that’s going to the UK,” he said.

“If it was coming to Australia, [it] actually would change a lot of the people’s lives in this room.”

Cameron Murray, chief economist at Fresh Economic Thinking, commented on Gearside’s post, saying the Bluey royalties could have “funded the ABC twice over”.

“Instead, we just gave them away to the BBC in a dud deal. Now the BBC is rolling in cash,” he said.

Bluey royalties and merchandise, which includes a massive range of products from plush toys to clothing, are sold in 50 countries and have become a major revenue driver for the BBC’s commercial arm.

Bluey has spawned a massive range of toys and merchandise. Photo: Moose Toys

An ABC spokesperson told News Corp this week that when the broadcaster co-commissioned Bluey, the “focus for the ABC was acquiring rights for Australian audiences as cost effectively as possible and with minimal risk”.

“With hindsight, a different commercial decision would have been made,” the spokesperson said. “Bluey is an integral and much-loved ABC program for our audiences, especially children.”

In 2022 when the Bluey deal first came to light, the Australian Financial Review quoted an ABC spokeswoman who outlined how the BBC secured the commercial rights.

“ABC and BBC Studios co-commissioned Bluey, with pre-production starting mid-2017, ABC taking broadcast rights in Australia and the BBC taking broadcast and commercial rights … globally,” she was quoted as saying.

“This is not an unusual partnership arrangement and one which has delivered a global success story for both parties.”

The AFR reported that Melbourne’s Moose Toys signed a deal with BBC Studios in 2020 to become the exclusive toy maker for the TV franchise.

It said the so-called Bluey-bump had seen the toy company’s owner, the Stul family, surge up the Financial Review’s rich list, with an estimated wealth of $2 billion in 2022.