IBC 2012 – AMSTERDAM. Two starkly different business models have emerged between major US content brands Disney and Discovery Channel as to how to deal with emerging platforms such as on demand and OTT.
Speaking in the session The Rise and Rise of Broadcasting, Catherine Powell, general manager, media distribution, Europe, Walt Disney Company said although the majority of programming was watched live, for some shows 50% of the audience was timeshifted.
Disney supports its TV partners through social media and second screen activity. “We as content providers give exclusive clips, access to talent, and sneak previews.” She said that the launch of on demand portals within a branded area helps new content to be discovered and drives viewers back to linear partners.
In the US ‘Watch’ apps have been devised with operator Comcast, giving access to sixty or seventy episodes per channel, once the customer has been authenticated.
As well as providing a safe environment, Powell said the apps provided onward sales to other material.
“We have some shows where over 50% of the viewing is on demand, key shows, something like Downton Abbey or the Olympics will always be live, but series there is a huge balance between in demand and live and for kids it’s across the board.”
The approach taken by the House of Mouse was significantly different from that of Mark Hollinger, President and CEO, Discovery Networks International. “We do not sell programmes to other channels like some broadcasters do”. Hollinger said that there were two revenue streams in advertising and affiliate sales.
“Every one of these new platforms are built on the back of content investment that has been made by other platforms. It is interesting to see they are now investing in their own content, giving the examples such as Lilyhammer and the revival of Arrested Development, ” said Hollinger. “They need channels, they may not need linear channels, but they need channels.”
Hollinger admitted Discovery had taken a conservative approach to new platforms and had looked largely towards its pay-TV platform partners. “This is going to be our approach going forward. the pay-TV business model has created the platform for us all to share. We made the decision long ago that if we were going to be in the content business, then we would keep back the best content for our own channels.”
Hollinger said Discovery would view opportunities as they came along.
Brian Sullivan, CEO, Sky Deutschland dismissed the concept of winners and losers between on demand and the linear world. The News Corp-owned platform has embraced new technology, including OTT delivery, in its relatively successful resuscitation of the German pay-TV market.
“All we did is concentrate on the basics, but do it in a modern way. We use technology, and we weren’t worried about canibalising our business because we didn’t have one to starts with. We had an easy opportunity to take technology and make it work for us.”
Sullivan likened the situation facing content providers the music industry of a decade ago, but in broadcasting it was about rights and technology, saying there was a danger that in seeking new revenues they might lose the existing ones.
