Scripps Networks CEO Lauds Amazon Content Deal, Says No to A La Carte Model
Scripps Networks Interactive sees opportunities to expand its international business, especially in Latin America, Europe/Middle East/Africa and Asia, and is encouraged by the early results of a online VOD content licensing deal with Amazon.com, CEO Kenneth Lowe said Wednesday.
Speaking at the Goldman Sachs Communacopia investor conference in New York, he also addressed recent ratings challenges at the Food Network and said his firm and industry wouldn't start offering networks a la carte.
The Food Network's ratings have been down for about a year. Lowe said the decline has come after a record year in 2012, leaving him not too concerned, but focused on getting bigger audiences again.
Lowe lauded an "extremely impressive" content pipeline for the channel starting in the fall and also highlighted that the Cooking Channel has seen record ratings this year.
Scripps is looking to "expanding internationally on a prudent and hopefully wise basis" by owning or co-owning networks like in the U.S. instead of just licensing content abroad. He cited the success of the UKTV networks joint venture with BBC Worldwide in Britain, the previous acquisition of the Travel Channel internationally and the Asian Food Channel.
Scripps earlier this year struck an Amazon subscription VOD deal and has remained "cautious" about making its TV content available online, because 95 percent of the firm's TV viewing is live or within three days, the highest among all cable networks outside of sports, Lowe said.
"We want to be very cautious…that our model stays in tact," he said, saying the Amazon deal allows for limited testing and important data, by which Scripps has been "very encouraged."
"There is no degradation of our overall viewing, and in some cases it is enhanced," said Lowe, predicting that there would be more digital content deals. "You will probably see us do more" as consumers want to access streaming content more regularly. He also signaled that the relationship with Amazon could open up electronic commerce opportunities for Scripps.
Lowe also echoed other TV networks executives in saying that "we are not going to an a la carte model" as the current pay TV bundle is "a great consumer proposition" despite recent carriage disputes between pay TV operators and network owners.
Asked about a Washington bill by Senator John McCain in support of a la carte offers of networks, Lowe said: "I don't think it will gain any traction."