By Paul Thomasch
NEW YORK |
Fri Apr 15, 2011 2:11pm EDT
NEW YORK (Reuters) - Three months after Oprah Winfrey's cable television channel premiered in the United States, preparations are underway to introduce the network to international audiences.
Executives from Discovery Communications Inc, a co-owner of the network, said early discussions have been held with distributors in foreign markets, adding that they expected talks to turn more serious later in the year.
"We're confident there are markets it will do well in," Mark Hollinger, who heads up Discovery's international business, said at a presentation on Friday. "We're confident there will be an international launch of the channel."
Hollinger declined to identify countries in the expansion plan. Other than the United States, the Oprah Winfrey Network can currently be seen only in Canada.
"We've said, 'Let's focus on the U.S. for now; we'll tend to this a little later this year,'" Hollinger said.
A joint venture between Discovery and Oprah Winfrey's production company, OWN launched in the United States early this year as a largely female-oriented network with a combination of lifestyle, advice and uplifting shows. Ratings have been mixed so far.
But Winfrey, regarded as the most influential woman on U.S. television, is expected to devote more energy to OWN in the coming months after the last original episode of her popular syndicated TV show, "The Oprah Winfrey Show," airs on May 25.
Discovery's international plans for OWN are part of its increasing effort to build up its business abroad. Chief Executive David Zaslav spends up to 40 percent his time outside the United States, he said, visiting markets such as Chile, Romania, Russia and India.
His efforts are shifting the financial balance of Discovery. Five years ago, only 10 percent of its business came from overseas markets. Today, around one-third of its does.
Given the rapid subscriber growth in developing markets, Zaslav said he would not be surprised if the company reached a "tipping point" in several more years that would make the international business bigger than the domestic.
"These are markets that feel like the U.S. 10 years ago," he said, a period he described as a "perfect storm" for the business when audience ratings, subscriber numbers, and spending on cable advertising were booming.
An added advantage for Discovery is that many of its adventure and science shows seem tailor-made for international audiences, since they usually avoid inside jokes or cultural references that can make comedies or dramas tricky to export.
The result is that much of Discovery's budget -- it now spends $1 billion a year on content -- can be used for shows that play both in the United States and abroad. By contrast, said Hollinger, other media companies operating abroad "have to produce all of their content on a local level or acquire it."
An area Discovery is approaching more cautiously is 3-D. While it has launched a full-time 3-D U.S. TV network, it has no current plans to follow suit overseas, executives said.
"Right now, it may be that in a lot of markets a full channel is not the route to take," said Hollinger, adding that video-on-demand 3-D would be more likely.
(Reporting by Paul Thomasch; Editing by Richard Chang)
