Discovery Acquires Switchover, Becomes Major Player in Italy's TV Market

8:43 AM PST 01/14/2013 by Eric J. Lyman

The U.S. cable networks group says it will be the country's number three broadcaster in terms of total audience share behind RAI and Silvio Berlusconi's Mediaset.

ROME – Discovery Communications said Monday that it has acquired full control of Switchover Media in a deal that Discovery says will make it Italy’s third-largest broadcaster in terms of collective audience share.

Financial terms for the deal were not announced, but it fits in with Discovery’s recent expansion in Europe. In December, the company, led by CEO David Zaslav, announced plans to acquire the SBS Nordic business in Scandinavia from Germany’s ProSieben for $1.7 billion. It also has agreed to a strategic alliance with France’s TF1 that included 20 percent stakes in Eurosport and other pay TV channels.

Furthermore, Discovery remains in the running to take control of Telecom Italia Media’s La7, the smallest of Italy’s seven national TV networks, and the only one not controlled by state broadcaster RAI or Silvio Berlusconi’s Mediaset.

Switchover Media, including Discovery's channels in Italy, will now operate six free-to-air channels and six pay TV channels. It will be run by Marinella Soldi, managing director for Discovery-Italy and general manager for Southern Europe.

Based on Discovery’s calculations, the deal for Switchover, which owns three free-to-air TV channels and one pay TV channel, will make Discovery Italy’s third leading broadcaster in terms of audience share, behind only RAI and Mediaset, and ahead of satellite broadcaster Sky Italia, a subsidiary of Rupert Murdoch’s News Corp. Sky Italia’s audience share is smaller than that of the other broadcasters because it is available only to paying subscribers.

Dee Forbes, Discovery’s president and managing director of the Discovery Networks Western Europe division, said Italy has emerged as a key market for the company.

“Italy is a leading market for Discovery and key to our growth here over the last two years has been the development of a successful free-to-air TV business strategy as this platform has grown,” she said. “The acquisition of Switchover Media adds further breadth and scale to that free-to-air strategy, as well as [helps] diversifying our portfolio to include scripted crime and children’s programming that have proven popular with audiences and advertisers.”

Switchover founder Francesco Nespega also praised the deal. “I am confident that an international leader in the media segment such as Discovery, with its content and resources, will be able to further expand the potential of the channels we created and implemented,” he said.

Nespega will remain on board as a consultant and advisor. 

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