Discovery’s CEO feels a combination of WarnerMedia and his company will create a new media company that is “uniquely competitive with Netflix and Disney,” and articulated the need to have a global footprint in the future in order to compete in the entertainment industry’s streaming wars.
Discovery last week stuck a pact with AT&T to take over WarnerMedia operations in a deal that executives hope will pass regulatory muster by mid 2022. WarnerMedia’s movie and TV studio and CNN cable-news network represent new opportunities for Discovery, which is slated to take over management of those operations as part of a new deal with AT&T that should be put into action next year, according to Discovery CEO David Zaslav.
“That’s two teams that are best of class, that are leading in the industry. Our view is we just want them to keep doing what they are doing,” said Zaslav Wednesday, speaking during an investor conference held by JP Morgan Chase. He was speaking of the Warner Bros. movie and TV operations, but then broadened his view to include CNN. The executive said those operations were not duplicated at Discovery.”
He said the new company would not pull back from the non-fiction programming for which Discovery is best known, explaining that the documentary and reality series that Discovery produces keep viewers interested but cost significantly less than scripted fare. “If we built a product on the back of scripted series only or mostly – and having to promote all those series. That’s expensive, and it doesn’t have the long-term nourishing sustainability of a lot of what we have,” said Zaslav.
He predicted advertiser interest in TV’s annual “upfront” market would be robust, noting that prices for so-called “scatter” advertising, or ad inventory that is purchased much closer to air date, were soaring. That is often an indicator that the volume of ad commitments purchased in advance will be more robust.