In a re-alignment of its U.S. network portfolio, Discovery Communications has named Eileen O’Neill to be Group President of the Discovery Channel and has been given oversight of Science Channel and Velocity — two networks seen to have tremendous growth opportunity. TLC, which O’Neill is credited with turning around, has been given to the care of Marjorie Kaplan, who becomes Group President of TLC and Animal Planet, while Henry Schleiff adds O’Neill’s Discovery Fit & Health network to his watch, as Group President of that network and Investigation Discovery, Destination America, and American Heroes Channel.
“Nearly 70% of our global output is developed, commissioned and acquired in the U.S.,” company CEO David Zaslav said this morning in a memo to staff. “Most of our big characters, new franchises and tent pole specials have been developed by U.S. Network creative teams. We continue to invest in new international and local content, but it turns out that Gold Rush, River Monsters and I (Almost) Got Away With It attract an audience in almost every market in the world. The optionality of sharing our programming across so many brands and countries, and lining up that domestic content engine to support our global distribution growth overall, is key to our success.” He noted the cpmpany’s marketshare in the U.S. is up significantly over the past six years, growing from 5% in 2007 to nearly 12% today, “and that creative output has helped drive marketshare growth of nearly 25% internationally during the same time.”
Ratings at the company flagships, Discovery Channel and TLC, fell more than 10% in Q4 – it was the first significant decline in years. But they’ve rebounded in 2014. Domestically, the company’s paying a lot of attention to ID, now in 85 million homes and headed to 95 million in a year or two. Ratings for rebranded channels Destination America and Velocity are growing, joint ventures OWN and The Hub are now seen as growth opportunities (after a rocky start for OWN).
The company also now has a big focus on building global platforms, especially for its five global networks: Discovery, Science, Animal Planet, TLC, and ID. A lot of questions about how Discovery will accelerate growth at Eurosport, which it formally acquired last month. Today’s announcement was made by Zaslav who, last month, had his contract extended through 2019, including a nice compensation bump for a man who already was one of the media industry’s highest paid CEOs with $49.9M in 2012. Following a year when the company stock appreciated 36.2%, the deal called for Zaslav’s annual salary to remain at $3M, but his target annual bonus for 2014 to climb to $6.6M and rise by $600,000 a year until 2018 when it will be $9M, according to an SEC filing back then. And, earlier this week, the company made news when The Financial Times reported that the John Malone-backed Discovery Communications and BSkyB, majority owned by Murdoch’s 21st Century Fox, are in talks on a joint bid for Britain’s Channel 5. The free-to-air broadcaster, which media entrepreneur Richard Desmond acquired for £103.5M in 2010, is thought to be seeking a buyer with about £700M to spend. Discovery, which operates about 200 channels worldwide, has been active in Europe recently. Last month, Discovery fast-tracked its acquisition of a controlling stake in pan-European platform Eurosport, and last year bought the SBS Nordic operations of Germany’s ProSiebenSat.1.
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