Discovery CEO David Zaslav: Oprah's OWN Off to Running Start Thanks to 'Strong' Upfront
The network, which launches next month, has yielded "meaningful" ad rates and multi-year ad deals, with the company next pushing for higher subscriber fees.
NEW YORK -- OWN: The Oprah Winfrey Network, which launches next month, has the potential to become "a big business," Discovery Communications president and CEO David Zaslav said Monday.
The channel, which will replace the Discovery Health network, is a joint venture between Oprah Winfrey and Discovery.
Advertising-wise, OWN is off to a running start thanks to a "strong" upfront earlier this year that yielded "meaningful" ad rates and multi-year ad deals, Zaslav said. Up next, the company will focus on "pushing for subscriber fees."
Indeed, Discovery Health has garnered only very low sub fees or none at all, he said, highlighting that the new channel should prove to be "of significant value to the cable industry."
He didn't detail the level that sub fees or overall revenue for OWN could reach.
Zaslav reiterated that OWN may not immediately find its full voice, but will listen to viewer input to build it over time.
Discussing Winfrey's involvement, he once again said "Oprah has had a great presence" preparing for the OWN launch. He also lauded her as "one of the rare talents that can generate talent," pointing to the likes of Dr. Oz who will join her on the network.
Discussing recently launched kids network The Hub, Zaslav said he is pleased with its trends so far. The recent launch of a Transformers show even helped the channel beat all competitors for an hour, he said.
Zaslav on Monday also highlighted the need for Discovery to keep improving business at its established networks, including Discovery itself, which has the potential to get "a lot stronger."
For example, there is a big opportunity in finding new shows that can also travel to Discovery channels around the world or vice versa come from overseas to the U.S., he said.
Zaslav lauded ID for being the fastest-growing U.S. network in terms of audience and the fastest-growing he has ever been involved with. It has ranked as the number 25 network in the past 14 days, and a top 20 channel for a couple of those days, he said, adding: "It's astonishing."
But he cited research that only 22% of Americans know of ID, meaning there is much upside once it gets to 40%-50%, and said the network also needs to fetch higher ad rates. The company will begin selling as an independent network as of January to improve its ad rates and ad haul over the next couple of years, he told investors.
Animal Planet is also improving its ratings, but needs further progress, Zaslav told investors. "We'd like to see it sooner. We'd like to see more growth," he said, adding that the network makes more than $100 million, but should make more than $200 million.
Discovery Communications previously said scatter ad market sales have remained strong with prices up 15%-20% over upfront levels. Prices are up even more now, with auto and financial services firmsd being strong categories, Zaslav said.
Asked about cord cutting fears, Zaslav said it is "hard to tell" if cable subscribers are abandoning pay TV services to watch more content online at this stage.
Alternative distribution offers online and elsewhere are still often inferior, which explains why Discovery has been conservative about making its valuable long form content available digitally, Zaslav said.