Western Europe is “the new emerging market”, Discovery Communications declared on Thursday as the US media group behind Deadliest Catch and Here Comes Honey Boo Boo explained a spate of acquisitions and investments in a market many investors have run from.
“For us this is a good time to lean in to Western Europe,” David Zaslav, Discovery’s chief executive officer, told reporters in New York on the day of an “upfront” presentation of new programming to advertisers. “We have no fear.”
Countries from Scandinavia, where Discovery bought Norway’s SBS for $1.7bn last December, to France, where it paid $221m for a 20 per cent stake in TF1’s Eurosport pan-European sports network, would remain among the world’s largest advertising markets, he said.
“When western Europe turns, if we have more channels that people are spending more time with . . . you’ll be able to maximise that,” Mr Zaslav added.
Discovery’s bullish statement follows two large European investments by John Malone, the cable pioneer who personally owns most of Discovery’s super-voting B shares. Mr Malone’s Liberty Global group has agreed a $23.3bn bid for Virgin Media, the UK cable operator, and last week bought a 12.65 per cent stake in Ziggo, the Dutch cable operator.
Mark Hollinger, chief executive of Discovery Networks International, said Discovery had been presented with opportunities because some European competitors were “holding back”. Some free to air broadcasters, in particular, were “struggling” in a weaker advertising market.
Mr Zaslav said Discovery’s recent deals had made it the largest cable programmer outside the US but also turned the company into “a broader media company”, widening its focus from non-fiction programming to take in sport and general entertainment.
His comments came as Discovery announced plans to launch TLC, its female-focused channel, in the UK through deals with Sky, Virgin Media and BT. The UK channel will launch at the end of April and will feature a block of programming from OWN, the network Discovery launched with Oprah Winfrey.
Mr Hollinger described the UK launch as the culmination of a strategy announced three years ago to take TLC outside the US, allowing it to offer advertisers and pay-television platforms a female-focused counterpart to the more male Discovery Channel.
Mr Zaslav said such initiatives had expanded Discovery’s market share outside the US by 25 per cent last year, as international advertising revenue grew by 18 per cent. Profits from international businesses, at $721m last year, were now as large as the entire group’s international profits six years ago, he said.
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