Disney's Anne Sweeney: Cable Companies Should Embrace Technology
The Disney TV chief joined Showtime's Matt Blank and AMC's Josh Sapan in trying to redefine a debate over innovation at the NCTA's annual convention.
WASHINGTON, D.C. – The cable industry is arguing strongly that it's the disrupter, not the disrupted -- and a cross section of network, studio and technology execs lined up to make just that point during the opening general session of the National Cable & Telecommunications Association annual convention.
At the heart of any disruption is technology, argued Disney's Anne Sweeney -- and cable companies face a big opportunity there.
“I think we all realize the consumer has taken control and they’re not giving it back,” said Sweeney, co-chair at Disney Media Networks and president, Disney/ABC Television Group. “So as every new technology comes forward, we have to figure out how to integrate it.”
Blank complained that the media too often looks at business through a warped lens. “Your favorite companies are ones with no revenue and no earnings,” said Blank. “Your second favorite are companies with revenue but no earnings.”
By contrast, Blank said that his company has revenue and earnings and is growing. “Disrupt me every day like that,” he said. “I want to wake up every morning that way.”
That line brought applause from the crowd of cable operators, programmers, technologists and others packed into a ballroom at the Walter Washington Convention Center.
“The notion of that disruption puts one on their heels?” said Josh Sapan, president and CEO of AMC Networks, “I don’t see it that way."
Sapan said while there are lots of new companies offering all kinds of innovative platforms and delivery systems, for those that own content, “it’s all part of new opportunities." An example, he said, were cable hits like The Walking Dead and Breaking Bad -- which air (to huge ratings) as originals and repeats, but also offer second-screen experiences, including webisodes with separate content. “That stuff is all additive,” said Sapan. “So if you’re a fan … you’re finding ways to get in deeper. That is a good thing. We welcome it.”
Disruption was also the theme of an earlier panel but with a difference. The panelists, with one exception, represent companies like Twitter, Roku and Jawbone that are at the heart of disruption in old business models – but took pains to downplay that reputation for the cable industry audience.
Ali Rowghani, COO of Twitter said what his company does “is a complement to television.”
Rowghani said 35 million Twitter users last year “tweeted about television while programs were happening. … Our user base has exhibited a pattern of watching television. Our mission is to bring people closer to the things they care about and allow them to participate in the dialogue about those things.”
Steve Shannon, general manager of content and services for Roku, was even more defensive. “We do get painted with the cord-cutter brush,” he said, “but the truth is most of our users have cable too.”
Shannon said about 79 percent of Roku users are also cable subscribers. He added that as cable adopts more of the TV Everywhere philosophy, Roku becomes an even better way for them to extend their brand and content. “Three-fourths of users,” said Shannon, “find new value” in cable through Roku.
When asked if they had an criticism of cable, Jim Bankoff, chairman and CEO of Vox Media said “people can move a lot faster.”
He said Vox uses technology industry principles to innovate and that means adopting the methodology Silicon Valley calls being “agile,” which means constantly creating and releasing new products. “You cant be afraid to disrupt anyone, especially yourself,” said Bankoff, calling on the cable industry to get out of the “cycle of waiting” for the fall schedule to test new shows, and to operate year-round as if there was a constant need for new content.
Hosain Rahman, CEO of Jawbone, said with “so many new devices,” you have to relish that you have “chances to try new things.”
“You see how fast behavior is changing,” said Rahman, adding: “If you embrace it you can try new ways to exploit that utilization.”
Tom Rutledge, president and CEO of the cable system operator Charter Communications, and the only cable person on the first panel, said the issue is no longer about whether they are in the television business, the Internet business or the cable business. “You create audiences,” said Rutledge. “The issues are the business model quality. How do you acquire customers if you have a video product.”
Rutledge said many people are “confused by the notion of the Internet and cable,” and that creates business and regulatory issues. But in the end, said Rutledge, “It’s all television.”
In the opening keynote address, Michael Powell, the former FCC chairman who for the past two years has headed the NCTA, used his platform to defend the American cable and broadband industries from those who unfavorably compare their progress to that other countries have made in the rollout of broadband with faster speeds and more advanced technology.
“In 2009,” said Powell, “the U.S. was ranked 22nd in world (in broadband penetration). Today we rank eighth.”
Powell added that the average connection speed of broadband has “tripled over the last five years,” and noted that the U.S. is a large country with some 315 million citizens where “We don’t cherry pick the most lucrative customers. … We serve everyone along our footprint.”
Powell said cable is working hard to offer broadband to all citizens, including those with lower incomes, through pricing that everyone can afford.
“The cable industry has always believed in an open Internet, and we will continue to embrace it,” said Powell, touching on a hot issue in D.C. over how to charge for online services as people use more and more bandwidth for video and other new ways to access content.
“It’s our job,” said Powell, “to keep the Internet humming as the world’s greatest engine of innovation.”
Powell promised cable will “compete aggressively but always fairly,” adding: “We want Americans to soar in the information age. … Cable is the platform that makes our digital dreams come true.”
The opening general session began with a performance by M.C. Hammer, backed up by 10 dancers.
The audience was welcomed by Abbe Raven, president and CEO of A&E Networks, and Patrick Esser, president of Cox Cable, who participated in a funny video in which they went to Monroe, La., to install cable TV service for some of the cast of Duck Dynasty. Three of the Duck Dynasty stars then came on stage to introduce the live appearance by Raven and Esser, co-chairs of this year’s convention.
The motto for this year's show is “Worlds Ahead,” and Raven noted that is exactly what cable is delivering.
Raven said the season’s final episode of Duck Dynasty “passed American Idol in ratings,” which she called “another cable milestone.”
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