dialogue with Jeff Zucker
EmptyIt has been nearly six months since Jeff Zucker was promoted to president and CEO of General Electric's NBC Universal. In that time, he has presided over a company that has been reshaped inside and out by tremendous change. Zucker discussed his tenure to date with The Hollywood Reporter digital media editor Andrew Wallenstein, including the hiring of Ben Silverman, his first exposure to the movie business and the potential threat posed by Rupert Murdoch in financial news.
The Hollywood Re- porter: It seems as if there's been a lot of executive movement in recent months across all divisions of NBC Universal. Is there an overarching strategy at play here?
Jeff Zucker: I think what's happened is we've used the first few months to put our team in place, from ensuring that (Universal Studios president and COO) Ron Meyer will be with us for the next five years to creating a very strong and new international organization to consolidating our non-NBC properties under (Universal Television Group president and COO) Jeff Gaspin. I think we've used these first few months to make sure we're structurally positioned for the new era, and I think we've made sure that we have put the right people in the right places but have not been beholden to the obvious choices.
THR: It does seem as if former NBC Uni TV Studio president Angela Bromstad isn't the first name you would think of for NBC Uni International or former Olympics producer Jim Bell to run "Today." Isn't there a risk inherent in bringing new people into new areas?
Zucker: What we try to do is put great executives and managers into places that are priorities for us whether they've worked in those areas before. I think that's one of the things that's been important to us. Whether it's Jim Bell at "Today," Dan Abrams at MSNBC or Alex Wallace at "NBC Nightly News" or Ben Silverman at NBC Entertainment or John Wallace at our TV stations division, they're all first-rate people who would not have necessarily been the most obvious choice, but we feel great about it.
THR: It's interesting in these restructurings to see a sudden resurgence in the Universal brand, between the rebranding of Universal Media Studios and Universal Television Group. Is there a conscious decision to play down the NBC brand?
Zucker: Not in any way at all. The fact is the NBC brand continues to be incredibly strong and promising, whether NBC news, sports or entertainment. But I think there is a strong acknowledgment that the Universal brands and properties are equally strong and have a great legacy, and we want to make sure they're not lost in any of this.
THR: Film is a new area for you. It's been an interesting mixed bag for Universal as of late. What have you learned?
Zucker: The fact is the film studio has had a fantastic summer and really turned its story around. We're going to have four pictures this summer over $100 million, two over $150 million in "Knocked Up" and (potentially) "The Bourne Ultimatum," which doesn't open until this weekend. "Knocked" was really the breakout surprise of the summer for any studio. "I Now Pronounce You Chuck & Larry" opened up No. 1 against very strong competition. With three movies in the top 10 last week and "Bourne" coming on, the film story has been strong for us.
THR: You've seen what's worked in "Knocked" and what hasn't worked in "Evan Almighty." How does that inform future strategy there?
Zucker: It's not fair to say "Almighty" didn't work. It's going to get to $100 million, and we strategically managed our risk. Obviously it was disappointing in terms of what we had hoped for, but it was not a huge problem for us. The question is, how does that inform us going forward? It's clear from "Knocked" and "Chuck" that that kind of comedy has been at the Universal wheelhouse, and it's what has worked. It's something (Universal Pictures chairman) Marc Shmuger, (co-chairman) David Linde and (president of production) Donna Langley are focused on going forward. That kind of comedy at that price point is something that's really the hallmark of Universal and something we'd like to see go forward.
THR: The hiring of Silverman continues to generate headlines. Given how that has all played out, would you have handled anything differently?
Zucker: No. As we've said many times, Ben became available unexpectedly and it was something we had to move quickly on. When things like that happen, it's never easy, but I feel very comfortable that we handled that very professionally.
THR: He's been there for a month now. What's it like working with him?
Zucker: Ben brings great enthusiasm, optimism and energy, so it's always exciting to have Ben around because his enthusiasm and excitement is boundless. The fact that he has been able to team so easily with his good friend Marc Graboff has given us a terrific team in Burbank. I think it's evidenced by the many announcements that Marc and Ben made at the summer press tour and how quickly they're moving together. It gives us all great confidence that we're all on the right track there.
THR: How do you see that track evolving? If you look at ratings on broadcast TV lately, do you have much hope in terms of squeezing fresh growth out of the broadcast business?
Zucker: I think it's clear the broadcast business continues to evolve and that all of us, no matter your position, are going to have to adapt and can't play by the same rules that existed for the past 10 or 20 years. I think that's why Ben and Marc are the perfect team to take us forward because they don't think traditionally and they are not bound by the way business has been done. At the same time, it's clear the broadcast business remains incredibly strong and vibrant as evidenced by the reaction of advertisers in the upfront and their desire to reach as big and broad an audience as possible. Sure, they're not what they used to be, but still far greater than any other way to reach a huge audience.
THR: Rupert Murdoch could acquire the Wall Street Journal. If he integrates that with Fox Business Channel, what does that mean for CNBC?
Zucker: If this were two years ago, I would be far more concerned. CNBC has transformed itself into a strong and thriving operation under Mark Hoffman's leadership. We feel very comfortable with where CNBC is at today. We don't take any new competitor lightly. We're not going to make the same mistake CNN made when Fox News Channel came along a decade ago. We'll be strong and aggressive and continue to prove what makes CNBC by far the leading financial news broadcaster in the world. With all due respect to the success that News Corp. has had in many different places, just because Rupert Murdoch wants to launch something, it doesn't mean it's an automatic success. I think there is a degree of irony that the company that broke the story that Rupert Murdoch wanted to buy Dow Jones was CNBC.
THR: There's always speculation of this ever-present looming threat of GE selling NBC Uni. Do you feel you've made progress in convincing GE chairman and CEO Jeff Immelt to stick with the company?
Zucker: I don't think Jeff Immelt needs any convincing. I think he's been crystal clear on this all along. He has no intention or desire to sell NBC Uni. So that has certainly not come form Jeff Immelt. I think this talk has dissipated over the past few months as our performance has continued to improve: three consecutive quarters of year-over-year growth from a bottom line standpoint. As people have seen that performance continue to improve, that talk has dissipated. Anyone talking about that is just a vestige of many months ago.
THR: That said, it takes a transformative move to get Wall Street's attention, whether it's Sumner Redstone splitting his company or News Corp. making the MySpace acquisition. NBC Uni has done a lot of sniffing at targets from YouTube to Dow Jones. Are there still areas where you could look to fill a gap in your company with a sizable acquisition?
Zucker: You have to look at what has happened in here in the past six years. Six years ago, we were a domestic television network. Today we are an internationally focused company that is in motion pictures, theme parks and cable in an incredibly serious way that we weren't five, six years ago. So this company has really transformed, and GE has invested a tremendous amount of money in transforming the company. We're always going to be looking at potential moves, but we'll continue to transform the portfolio and we'll always want to get out of slower-growth businesses and move to higher-margin, faster-growing areas, and we'll continue to do that and transform the portfolio in the months or years ahead as it makes sense.
THR: Six months is a long time in the digital world, and it's been interesting to see how NBC Universal has played that game. How does the development of (the so-called) NewSite (the joint venture with News Corp.) and NBBC (National Broadband Co.) reflect a refinement in your digital strategy overall?
Zucker: The joint venture we're doing with News Corp. is a big part of that strategy. NBBC has been rolled into that, so that's been a big opportunity for us to use their technology to get off the ground. There's no delay in the launch of NewSite, we'll be up when we said we'll be up, which is sometime in September. We've hired a first-rate CEO for that (former Amazon exec Jason Kilar). That part of our digital strategy we feel very good about. We have clearly led the way on the online side with regard to broadcast networks. The success of NBC.com has been staggering, something we're incredibly proud of. The number of streams on NBC.com has been phenomenal. MSNBC.com continues to be a huge asset for us and lead the way on the news and information side. We've launched CNBC.com in the past few months to quite good results, and we made a number of acquisitions in our Bravo family of online assets under Lauren Zalaznick's leadership. We're feeling quite good about all that. Then, of course, iVillage continues to grow; they have 11 of past 12 months of increasing traffic. I think in every respect we feel good about that.
THR: Have you truly mined as much growth out of iVillage as you hoped? That was not a cheap acquisition.
Zucker: There was no question you can't get into the digital space at bargain rates, but we think that iVillage sits perfectly in our family of female programming, whether it's Bravo or "Today," and they're making progress. In the second quarter, display advertising revenue was up more than 40%. There's still a ways to go; we still think there's upside at iVillage. As we continue to grow it, it will become an even more important part of the portfolio.
THR: Overall digitally, there's contrasting styles at the conglomerates. CBS Interactive Audience Network puts content everywhere, while the Walt Disney Co. plays closer to the vest. How do you stack NBC Uni against these contrasting styles?
Zucker: You're right that every company has its own strategy. Ours has been to grow our own sites under TV 360, expanding our brands digitally. That's proven to be a successful strategy. But we're also with the launch of the NewSite trying to make sure our content is as ubiquitous as possible. We're trying to actually play both games and go at it that way, then to add to that iVillage, CNBC.com, MSNBC.com and that's the strategy that we've decided to undertake.
THR: During your first days on the job, you took a shot at Google over privacy protection. Do you feel any different now?
Zucker: That hasn't changed. Obviously, we feel our content should be protected and we should be compensated for our content. Clearly, Google has the capability of filtering, they filter when they want to, and we're having discussions with them now about making sure they do that in a serious and robust way, and we expect them to do that and we're going to monitor that closely to make sure that happens.
THR: Turning to the international side, it's an area of increasing interest for you.
Zucker: It will be one of the key drivers for our future growth, there's no question. International is a strategic priority for the company. We're actively looking for strategic targets to accelerate that growth. We have a new head of the international film studio in Christian Grass, new head of international TV studio in Angela Bromstad, and we'll have some more announcements shortly with regard to key personnel. The one other priority we've added in the past few months besides digital and international is a full-time diversity leader on my staff in Paula Madison. We've made that a strategic priority for the company as well.
THR: Are there greater ambitions now that you're getting your hands around the film business in terms of how to grow that? Do you look at what's going on with Paramount and DreamWorks, and think that's a property to look at?
Zucker: I'm not going to comment on what may or may not be going on elsewhere, except to say the DreamWorks team always has been and always will be a team we have great affection and respect for.
THR: Do you let Ron Meyer do his thing and step back or do you get involved there?
Zucker: I try to put good people in place and let them do their jobs. That's been the hallmark of what we've done with Mark Hoffman at CNBC, Steve Capus at NBC News, Ben Silverman at NBC Entertainment, Ron at Universal, Tom Williams at the theme parks. We've also had a very exciting couple of months on the theme park side: We've announced the new "Simpsons" ride is coming in '08. "Harry Potter," the highly sought-after new attraction, will come to Universal in '09. In Ron Meyer's world of theme parks and movie studios, its been a very exciting couple of months here.
THR: Do theme parks get their due?
Zucker: That's a good question. I think there are a lot of people who thought when the merger happened we were going to dispense of the theme parks. Probably the most pleasant surprise has been the continuing strength of the theme parks. It's a small part of the overall business, but it's been a strong performer for us. Tom Williams has done a very good job.
THR: The cost-cutting implemented under the NBC Uni 2.0 plan — are those cuts done at this point?
Zucker: I think financial discipline is something that never ends. I think what's clearly happened at every one of our competitors is that same discipline has been applied whether in the broadcasting or cable or print space. Everybody's gone through what we talked about. We've talked about it publicly because I don't think you can hide these things. But I think it's noteworthy that in the nine months that have followed our announcements, virtually every one of our competitors have gone through the same thing.