Discovery Communications CEO David Zaslav is happy with the company’s continued direct-to-consumer push, on Tuesday lauding the just-ended Winter Olympics as a key driver of user growth in Europe.
“We have taken some major steps forward in the execution of our digital strategy,” Zaslav said on an earnings conference call in discussing how over-the-top sports service Eurosport Player performed during the Olympics given that Discovery/Eurosport for the first time aired the Games across Europe.
“Ahead of the Olympics, we surpassed the 1 million subscriber threshold for the Eurosport Player, our sports Netflix product,” he said. “And since then, we expanded the combined reach of our Eurosport and DPlay direct-to-consumer offerings by almost half a million subscribers during the period of the Olympic Games. While some of these subscribers will likely churn off in the weeks and months ahead, we feel great about the added brand awareness and engagement we have achieved.” Discovery has been rolling out its Scandinavian over-the-top video service Dplay in Europe.
Concluded Zaslav: “I can’t think of another company…that has been able to garner almost half a million subscribers in less than 15 days. It’s quite an achievement.”
Discovery has in the past said that subscribers on average pay $8 per month for the Eurosport Player, but it had special prices for the Olympics, with most markets, including Germany, offering a five-day free trial and the U.K., along with others, offering a 99 pence price for the first month, which then converted to 6.99 pounds monthly or an annual pass.
Discovery CFO Gunnar Wiedenfels on the call also discussed the Olympics’ effect on the company’s financials, reiterating that the just-ended Pyeongchang Winter Games will be roughly neutral for earnings in 2018, while the Olympics over the full multiyear rights contract will be profitable.
He said the company would in the first quarter of this year expense the complete $240 million in costs, made up of $140 million for the rights and $100 million for production and marketing, along with some revenue, mainly the sublicensing and advertising revenue, while other revenue benefits will be spread out over the year.