Discovery Denies Report It's Developing a Streaming Service

7:03 PM PST 06/26/2013 by Maura McGowan, Adweek

The company says it "is not developing or pursuing a direct-to-consumer offering. Any discussion or speculation to the contrary is simply inaccurate."

Discovery Communications is reportedly developing its own streaming service modeled after HBO Go. The company wants to charge cable subscribers an additional fee for on-demand access to programming like Here Comes Honey Boo Boo, Shark Week and Cake Boss.

According to executive chairman and founder John Hendricks, Discovery’s portfolio of channels has an abundance of content just sitting on the shelf. Netflix and Amazon license mostly older TV shows from seasons past, Hendricks said, leaving content between three and 18 months old unavailable online. The new service will charge basic cable subscribers $6-8 for access to these videos on demand.

Hendricks told Reuters the service is in the early stages of development and could be ready in the next two to five years.

STORY: Discovery Schedules 'Skywire' Follow-Up With Nik Wallenda Interview

UPDATE: Discovery late Wednesday afternoon issued a statement that effectively refuted any talk of a subscription TV Everywhere service,. The full statement follows:

“The company is not developing or pursuing a direct-to-consumer offering. Any discussion or speculation to the contrary is simply inaccurate.

"In a new book released by HarperCollins on June 25 titled A Curious Discovery: An Entrepreneur’s Story, John Hendricks describes his vision for the future of television over the next decade including viewing technologies that provide ever-closer-to-reality visual experiences and future online access by cable subscribers to cloud-based file servers. In press interviews about the book, confusion and misreporting has [sic] arisen over discussions of future cable technologies (to be developed over the next 5-10 years) with current industry discussions regarding TV Everywhere deployment.

"The company policy is clear: aggressively pursue TV Everywhere agreements that help deploy this critical new platform, reinforce the value proposition of the pay TV ecosystem, and through an authenticated pay wall, give consumers more access and choice.”

Discovery is the only major cable conglomerate that has yet to develop a TV Everywhere service. Speaking to investors on May 7, Discovery president and CEO David Zaslav said the company has not been able to reach an agreement on a fair pricing scheme with cable and satellite providers.

“We haven’t done any of those deals yet, but we are talking to operators,” Zaslav said. “We think there is more value there. We have 10 percent market share, we have a lot of great content. … It’s a fight over value.”

Shares of Discovery closed up 26¢, or 0.34 percent, to $75.72. Discovery shares are priced higher than any stock in its competitive set.

This story first appeared in The Hollywood Reporter's sister publication Adweek.

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