Starz CEO: We Aren't For Sale, Never Were For Sale
At an investor conference Chris Albrecht said he's been confounded by untrue rumors about his company
The Starz pay television service is not for sale now and was not for sale last fall when there were rumors it was about to be acquired, according to Starz CEO Chris Albrecht.
"I've never looked at Starz being acquired as a great end result," Albrecht said at the Citi 2015 Internet, Media and Telecommunications Conference in Las Vegas on Wednesday, "because I don't think Starz has reached its full value."
Albrecht said they did look at strategic options after Liberty Media spun off the Starz as a separate public company last year, but they never came close to a deal despite press reports that confounded the CEO. They did continue to grow, recording a record 22.5 million subscribers last fall.
So where does the misinformation come from?
"There are ten guys in Hollywood, maybe 12, and five women," said Albrecht about how rumors get started, "and we all know each other, and we all eat in the same restaurants and we do a lot of things together."
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"And there are 15 bankers," continued Albrecht, "and if one banker thinks another banker is working on something, then the way he's going to screw that banker over is to say s— that isn't even true about what the banker is working on. He's going to f— it up because it's not his deal. This is one incestuous giant mess that results in me sitting and reading something about the company I run and saying, 'I didn't know that.' "
"I got misquoted saying something at whatever conference we were at a few months ago," continued Albrecht. "I mean I was literally sitting one day reading articles where there were all these companies poised to buy Starz. And the next day, I was literally reading articles that were saying there is not a buyer in the world for Starz. Neither one of those things is true."
"Starz never went through a sales process," declared Albrecht, "never put itself up for sale. The rationale behind Starz becoming a separate standalone entity was that we were going to be more flexible to create whatever alliances came our way, and those could be anything from a merger to a strategic partnership, or we would acquire something or be acquired."
It also makes Albrecht crazy when people say that Starz is in trouble because it has difficulty sustaining relationships with cable distributors.
"We actually make money for these distributors," added Albrecht, "so at the end of the day, if there's no reason to punch a guy out, you probably sit down and find a way to shake hands and continue to make money together. I like our chances in those conversations."
Albrecht said the era when premium channels depend on studio movies alone is over. He began making original shows and series when he was at HBO and for the last five years has worked to do the same at Starz.
He said they are entering their second full year of having a significant amount of original, exclusive product that can help build their brand not just in the U.S. but also worldwide as those show are licensed to others. "High-quality originals delivered to the audience uncut, unfiltered is certainly in great demand," said Albrecht, "not only by the consumer but by people who want to distribute those products."
"At HBO we were the only people doing that," recalled Albrecht. "We reinvented the playbook. A lot of people copied it because it works. We're employing it at Starz because it works. We're a little late to the party but certainly not too late."
He expects to have at least 50 hours of originals this coming year and intends to grow that to 75 hours or more (which he now tracks not as hours but as series) in the future.
"The measure of success for me," said Albrecht, "clearly is going to be, 'Can we grow our subscriber base and our financial results?' And that is why we shifted from an all movie service to an originals and movies base. Originals being the lead dog."
Following all the untrue rumors, Albrecht said he did learn from the experience: "Strategically, what I learned from this last session is don't talk to anybody, don't be seen having lunch with anybody, don't visit anybody at a studio even if you are only going to drop off a birthday present. Just don't do anything. Stay in your house. And don't send emails either we've learned recently."