Discovery Communications has big plans for its overseas and digital businesses driven by new initiatives to expand its Velocity auto-themed channel and sell subs for its EuroSport online app, CEO David Zaslav says this morning. “Our international pillar gives us a real hedge as you look at the slowing of the U.S. business,” he told a press gathering. The company has a 45% profit margin on its global services which reach about 230 countries.
Discovery has tested the international appeal of Velocity — known overseas as Discovery Turbo –and “now we’re going to take it around the world,” Zaslav says.
The company also unveiled a two-year campaign to expand subscriptions for its $8-a-month EuroSport video streaming app to 1 million from about 200,000. That would “really drive” Discovery into the direct-to-consumer business — a fast-growing field as companies including CBS and HBO look to reach viewers who don’t have pay TV subscriptions.
Discovery’s making these and other announcements this year in small gatherings with advertisers, ditching the splashy upfront showcase it has held in recent years at NYC’s Jazz at Lincoln Center. “We need to bring the presentation to them in the most efficient manner,” ad sales chief Joe Abruzzese says.
He hopes to keep advertisers from cutting their TV spending by investing in research tools with Rentrak, Clypd, Nielsen, and Lake 5. He noted that 90 networks are more cluttered with ads than networks including Investigation Discovery. “We’re going to press this pretty hard.”
Zaslav says that the ad market now is “definitely better” than it was in Q4 but “I wouldn’t say it’s robust.” Abruzzese says that while the upfronts won’t be “gangbusters,” it “will be better than last year.”
But the company hopes to be covered if buyers do divert dollars to online alternatives. Discovery Digital Networks will make a May 5 presentation as part of the Internet-focused NewFront gatherings, an alternative to the TV upfronts.
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