Discovery CEO says next 100M subscriber VOD service won’t be another ‘scripted and movie player’

Discovery Communications CEO David Zaslav speaks at Investor Day 2015
Discovery Communications David Zaslav at Investor Day 2015 (Discovery)

Discovery CEO David Zaslav said his company has a bright future in the OTT and direct-to-consumer market because it isn’t reliant on scripted content and films like so many of the current services available.

He said all the offerings in the $10 to $15 range for consumers who don’t want sports or broadcast networks are Netflix, HBO Now, Starz, Showtime and Amazon, which are all movies and scripted content.

Zaslav said that even if Discovery put together its entire portfolio, including the networks it just acquired from Scripps, it could offer it as a standalone service. He also said that Discovery could bundle its content with others or one of the broadcasters or one broadcaster in each market.

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“But let’s assume that we did it just ourselves globally. What other company could offer a multitude of 18 brands, 10 of them that people know everywhere in the world, and offer it for less than any of those channels?” Zaslav asked.

He said that there are now two video services, Amazon and Netflix, with 100 million subscribers or more, and said that some are speculating Disney could be the next brand to reach that subscriber mark.

“I believe the next one to get to 100 [subscribers] is not going to be another scripted and movie player. There’s just too many of them. Another one of those? What’s the difference?” Zaslav asked. “What we have is different, it’s quality and it’s safe. What mom around the world wouldn’t say that they want what we have to offer? So if we look at how we go direct-to-consumer, going global or going regional, doing something with one of the FAANG companies or doing something ourselves; all of that looks attractive to us because we think the marketplace is very crowded and that the understanding of what each of those [services] means is melding together and you’re starting to see a lot of the same stuff. And we’re different.”

RELATED: Discovery CEO Zaslav tees off on retransmission fees and sports, pushes for entertainment-only bundle

This isn’t the first time that Zaslav has decried the current state of channel bundles in the U.S., which he has called overstuffed due to costly sports rights and retransmission fees.

“Together with the fact that most sports channels are owned by the retrans broadcasters, you have a combustible combination,” Zaslav in November during Discovery’s 2017 third-quarter earnings call. He added that the U.S. is also the only market with regional sports networks. “Sports has essentially been hyper-extended here to the point of ‘Are you serious?’”

Right now, Discovery’s channels are packaged in Philo’s $16 per month streaming service that excludes sports content. AT&T recently revealed that it’s planning a similar product called Watch, and Discovery’s networks could certainly play a big role in that service.

Zaslav declined to comment on AT&T or its plans to launch a sports-free skinny bundle, but he did say that more multichannel companies are listening to their customers and that it’s not fair to continue asking consumers to subsidize massive sports rights.

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