The newly expanded Discovery, which recently acquired the Scripps Networks stable of lifestyle outlets like HGTV and Food Network, is ready to take on the streamers by being the factual/unscripted alternative. Speaking to reporters on Thursday at the Television Critics Association press tour, CEO David Zaslav hinted that an eventual direct-to-consumer Discovery streaming service would cost between $6 and $8 a month, and be promoted as an offering that would be an alternative, or additive, to the scripted-heavy offerings of other services.
“We see the media business as two sides — one side is scripted series and movies, and we’ve moved away from that,” Zaslav noted. Those scripted services already charge, or eventually will charge, between $10 and $15 for their platforms. “We see what we have as everything else,” he said. “We have great content. We own it all globally… We have a lot of scale. We have a lot of strength.”
Later, Zaslav told IndieWire that he’s taking a wait-and-see approach as to when and how Discovery might deploy such a service. “We own all of our content so there’s real optionality,” he said. “There’s some real skinny bundles now with DirecTV going out with their 30-channel bundle, and we’re seeing how that does. We’re talking to consumers about what they want.”
In the meantime, Discovery is getting its toes wet here in the U.S. with services like Motor Trend On Demand, which offers car content.
Zaslav noted that the industry will be in a bit of a limbo in the coming years as it juggles the still-profitable traditional, linear ecosystem with the broadband ecosystem.
“One of the reasons we did the Scripps deal, one of the reasons we invested so much in sports is we think owning all of that IP and having a full menu of quality content that people love will give us a better chance either by putting it all together in a broad offering, or individually to have people want to spend time with our content on their devices or phones,” he said. “Over time more of those choices will be made individually by consumers. The next couple of years you’re not going to see a lot of change, but I think it’s important for us that we own all of our content globally, and therefore at the right moment and with the right package we have a chance to offer our content.”
But as consumers start to decide just how many subscription services they’re willing to purchase, Zaslav said he feels good being in the factual space. A few years ago, Discovery Channel attempted to get into the scripted business, with entries such as “Harley and the Davidsons” and “Manhunt: Unabomber.” But that strategy has now changed.
“We decided, let’s do what we do best and focus on nonfiction,” said Nancy Daniels, chief brand officer of Discovery and Factual. “There’s a lot of scripted content out there. It’s hard to break through.” Discovery Channel, of course, is probably best known for franchises such as the currently underway “Shark Week” and series like “Deadliest Catch.”
The return to focusing mostly on unscripted content also comes following Discovery’s acquisition of Scripps Networks. Discovery’s channel stable now includes Discovery, HGTV, Food Network, TLC, Investigation Discovery, OWN, Animal Planet, Travel Channel, Science Channel, DIY, Cooking Channel and more.
“In the U.S. we’re the second largest TV company in terms of reach,” said Zaslav. Discovery is behind only NBCU for now (although a merged Disney/Fox will likely pull that company back ahead).
Asked about the future and whether Discovery is big enough to compete in a marketplace where conglomerates are bulking up to compete in a digital landscape, Zaslav said, “We’ve placed a lot of chips as bets, and we’re feeling quite good about it.”
He said he was at first surprised that Rupert Murdoch opted to sell off most of 21st Century Fox, but in the face of entrants like Amazon, Apple and Netflix, “the competitive nature of that side of the business has changed.”
Discovery has also been building up its sports properties overseas, including Olympics rights in Europe and offerings such as a potential direct-to-consumer platform for golf. Discovery makes $1 billion with its international properties, he added.
As for its channel stable, which includes both the major networks listed above and smaller niche channels like Great American Country and Discovery Family, Zaslav said he’s looking to get as many outlets as possible on new “skinny bundle” digital offerings like DirecTV Now. “Let’s make sure we have 8 or 10 or 12 that are great, that people will pay for before they pay for dinner,” he said.