Discovery open to teaming up with pay TV operators, may take Velocity international

JB Perrette

Discovery is open to partnering with European pay TV operators to acquire or develop new pay or possibly free-to-air services as it seeks to further expand its business on a market-by-market basis, according to JB Perrette, Discovery Networks International’s new president.

Perrette also said that Discovery could look to rollout its automotive interest channel Velocity internationally.

Declining to comment on recent reports that Discovery could team up with BSkyB to make a joint bid for UK free-to-air service Channel 5, Perrette told DTVE at Discovery’s advertising upfront event in New York that Discovery is in principal open to forming joint ventures with distribution partners.

“In general we remain largely a pay TV business, but if there are opportunities to work with pay TV partners in different ways to grow the business and develop audience share in free-to-air as well as pay TV, we absolutely want to look at those,” he said. “However, we do see ourselves as primarily a pay TV business.”

Earlier, Perrette told journalists that following the closing of its acquisition of a majority stake in Eurosport, international markets will for the first time represent over half of Discovery’s overall business – a significant milestone for the channel operator that testified to the success of its strategy of investing its profits in new channels and content.

He said that Discovery’s success in international markets rested on strong local leadership, a continued focus on great content and brands, branching out into new genres including, via its SBS acquisition, scripted drama, and investment in new channel genres and new platforms.

Perrette told DTVE that he sees particular synergies between SBS and Eurosport, in which Discovery is soon to complete the acquisition of a majority stake.

“SBS is complementary with Eurosport and what we can do in rights and building and sharing content with Eurosport is very attractive to us,” Perrette told DTVE. “Despite moves towards free-to-air, our core remains as a premium pay TV business.”

Discovery will likely rollout its motorsport and related interest channel Velocity internationally following its successful rollout of ID and ID Extra in a number of international markets, according to Perrette.

Discovery’s acquisition of a majority stake in pan-European sports network Eurosport could give rise to opportunities for content sharing and cross-fertilisation with Velocity, which Discovery launched as a male-skewed channel focusing on motorsport and automotive themes in 2011.

“We can see potential over time and also complementarity with Eurosport,” said Perrette of Velocity.

He said that Velocity’s focus on catering to “core adrenalin enthusiasts” could give it a strong international appeal. “We could look at doing something with that – it’s pretty interesting,” he said.

Perrette earlier told journalists that Discovery’s current big international channel push is focused on increasing the presence of female-focused true crime channel ID and younger-skewing sister channel ID Extra internationally. Discovery is rolling the latter out in six countries in its central and eastern Europe, Middle East and African region this week, with two more to follow in July.

Perrette also highlighted Discovery’s successful international rollout of female-focused TLC, which will add Germany to its list of international territories next week, following its earlier launch in countries including the UK and the Netherlands. “There is no bigger female flagship brand around the world,” he said. TLC is now present in 168 countries and reaches 340 million subscribers, he said.

Discovery Communications president and CEO David Zaslav told journalists that he is confident that Discovery can repeat its US success of increasing its market share from 5% to 12% over the next few years.

Zaslav said that when it launched in the US, ID had been the first major new pay TV channel launch for 10 years. He said the channel had overcome skepticism to emerge within four years and the number two female-focused network in the country. He said this success had given the broadcaster the confidence to take the channel into international markets.

Discovery Networks International chief content officer Luis Silberwasser told DTVE that Discovery’s pay TV channels teams were beginning to work more closely with SBS’s channels.