Q&A: Hannes Heyelmann, MD, Germany, Austria & Switzerland, Turner Broadcasting System

Following the international debut of female lifestyle channel Glitz in Germany, Digital TV Europe’s Graham Pomphrey spoke with Turner’s Hannes Heyelmann about the launch.

Why did Turner choose Germany for the international launch of Glitz?
The German speaking market is the first market in Europe where we introduced the Glitz brand following its successful launch  in Latin America in May 2011. We identified that there is the market demand for a channel with a female target group, we believe that the German pay TV market has a lot of growth potential, and key distribution partners like Kabel Deutschland were as convinced as we were that we will put together a great channel and agreed on the distribution of Glitz.

Why has Turner invested so heavily in  the German market?
We believe that pay TV is going to be very successful in Germany. We wanted to have a strong channel offering in place before the market takes off and not come too late to the game as the channel bouquets will remain rather small for a while to keep prices low for consumers. Germany clearly is a tough environment for pay TV, given the big free TV offering. However, more consumers are convinced by the added value pay TV has to offer and the market has started to grow significantly. The subscriber base of TNT Serie for example grew by approximateky one million subscribers in the past 12 months and we see no signs of the growth slowing down. TNT Serie will break through the five million subscriber mark in German speaking territories this year.

Was it an easy decision to launch a HD version of Glitz considering the relatively slow take-up of HD services in Germany?
HD has proven to be one of the main drivers for pay TV growth in the German market in the last year. It was a no brainer to launch an HD version in addition to the SD channel. This is the only way to fully participate in the pay TV growth. The HD version of Glitz is very attractive for the platforms as well as the consumers, as the channel has more than 70% native HD material, which is way higher than what the HD Plus free TV channels in Germany have to offer.

What are your goals for the channel by the end of the year?
To make sure as many people as possible know about the great content Glitz has to offer. Also, to reach a distribution agreement with Sky Germany, the last large platform where an agreement for Glitz is not in place.

How challenging was it to launch a new channel during the economic downturn?
The recent economic crisis has shown that pay TV is not really affected by economic turbulence. Pay TV remains a growing market. When people have less money to spend, home entertainment seems to become more important. In the German-speaking market revenue made from subs is the main pillar of our business model. Therefore the pay TV business is not as dependent on advertising as  free TV channels are. Also Germany in general has not been as affected by the economic crisis as other European countries have been and still are.

How will Glitz compete with local lifestyle channels, like Sixx?
Sixx is a free to air channel, therefore it is not a direct competitor for us. Glitz viewers benefit from the advantages of pay TV. This means 24-hour premium content with no show interruption by commercial breaks and the availability of the original language track. Glitz has more German market premieres than Sixx, more local original productions and no informercials.

How much progress has Turner made with its two TNT channels in Germany?
We believe in strong localised channel brands with high quality content and reliable scheduling. And while we source the vast majority of content through Hollywood studios local productions are important to differentiate the channel. For TNT Serie we have just finished the production of the first season of the dramedy Add a Friend, which is not only our first fictional series, but the first fictional series ever produced by a German pay TV channel. The series will air in September 2012. A representative brand tracking survey shows that the brand awareness for TNT Serie is more than 75% in pay TV homes. This is a great result, given the fact, that TNT Serie was only launched a little over three years ago. TNT Serie is one of the top three basic pay TV channels in the 14-49 target group.

Will Turner launch similar channel packages outside the German market?
Many of the channel brands that exist in Germany already exist in localised version in other European markets too, for example, TNT in Spain, Nordic and the Benelux and of course Cartoon Network and Boomerang all over Europe. Speaking for Glitz, I wouldn’t be surprised if other markets will follow.