Euston Films Ltd was formed in March 1971, the brainchild of Thames TV (and formerly ABC) executives Lloyd Shirley, George Taylor and Brian Tesler.
The line of development can be traced back to The Tyrant King, a six-part Thames children's serial from 1968 directed by Mike Hodges and filmed entirely on location with 16mm film -- a format predominantly used at that time for news gathering due to the portability of the cameras. The success of the venture led Thames, and Hodges, to put into production two ITV Playhouse dramas using the same techniques. The thrillers Suspect (tx 17.11.1969) and Rumour (tx 2.3.1970) proved so successful that the idea for a company was formed.
Several other factors probably helped Euston's inception along: Thames' profits were high at the time and it was felt that the money should go somewhere; a deregulation of the number of broadcasting hours meant that the parent company's electronic studios were filled to capacity; and of course there was the lure of being able to offer viewers "films for television", at a time of great rivalry between the film and TV industries.
With no studio staff to worry about, the company was always intended to be cost-effective. At the time, Lloyd Shirley said "Our set-up is a flexible, mobile operation. Filming in studios is not our game. We are completely location people".
Indeed it is important to note just how much of a breath of fresh air the Euston formula must have seemed at the time, for both the audience and the production personnel. In 1971 most UK television drama was recorded multi-camera in a studio in just a single evening, the output a strange hybrid of film and theatre (which nonetheless has its merits, not least because of the lengthy rehearsal time). 2010 and, for good or ill, most television drama follows the Euston mode - approximately 5 minutes of cut footage a day, no rehearsal.
Lloyd Shirley again, speaking in 1974: "We have tried to blend people who have learned their film-making through television with people who have been film-makers in the film industry for exhibition. The traditional film people have a wonderful skill of improvisation, the television people are meticulous planners.
"They make an interesting combination and it has worked very well".
So Euston then can be viewed as a meeting of minds between the two industries combining the best of both? I'd go along with that.
Sources: Made for Television: Euston Films Ltd by Manuel Alvarado & John Stewart (BFI/Thames Metheun, 1985); "Lloyd Shirley waves the Union Jack for TV feature films" by Gerard Garrett (CinemaTV Today, 22 June 1974).