Discovery Executive Insights: Digital Licensing, International Growth
Benjamin Swinburne – Morgan Stanley: David, I’d say most people would probably weigh in that Discovery has been very deliberate in thinking about licensing digitally, but we’ve had this debate during earnings so far between, sort of, Time Warner, Viacom, and DISH calls talking about how much content can move online before you start to impact potentially your value proposition to your distributors? I thought you speak to your distributors on a regular basis, and you’ve got some big renewals coming up as you enter 2013, so I would hope you’d be wanting to weigh in on how you’re thinking about that balancing act, to make sure you’re maximizing your long-term value versus taking more of a short term approach and how you sort of gradually expanded your Netflix (NASDAQ:NFLX) and Amazon (NASDAQ:AMZN) relationships. Then I just had a clarification for Andrew; the high single digit ad growth number – sort of guidance or pacing for domestic, was that for the remainder for the year or for 2Q, I just wanted to make sure I heard it right?
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David M. Zaslav – President and CEO: Okay. Thanks, Ben. Let me talk about the digital opportunity. This really is a great time to be in the content business, because we’ve created essentially a new window. We’ve worked very hard to figure out what works for us, and for us this new window being 18 months and older is significant, because we use our content domestically and around the world during that window and so giving it to Netflix (NASDAQ:NFLX) and to Amazon (NASDAQ:AMZN) where they have 18 months, two years, three years, four-year-old content and getting real value for it has been significant in terms of the value it provides to us. As we look at what impact that has on our viewership, to-date we haven’t seen any impact on the viewership on our traditional channels and part of that may be that we’re only six months in; it’s very early days, but it’s also interesting that a lot of the shows that are being consumed on those platforms are shows that were no longer on Discovery (NASDAQ:DISCA) or TLC or Animal Planet. So, we did keep deals short so that we have some flexibility. Our Netflix (NASDAQ:NFLX) deal was two years with a one year option for us to for a third and that dovetails with our deals that (come up and) so that if there was a real problem we could (pave it). But so far we see it as real opportunity in additional window that’s providing significant value to us. In addition, we have TV Everywhere out there which provides another opportunity for us to monetize our content. It hasn’t materialized yet in a meaningful way but it’s an attractive platform that would be if Netflix (NASDAQ:NFLX) and Amazon (NASDAQ:AMZN) and LOVEFiLM if those platforms are 18 months and older from our perspective and TV Everywhere would be more of a catch-up and provides some additional incremental value. So, for us, we’ve been able to grow market share and take advantage of those platforms, so it’s been a good experience so far.
Andrew Warren – SEVP and CFO: So, regarding your question on ad sales, that’s a 2Q number only. Given that it’s early May we have good line of sight into 2Q. So, that’s a 2Q forecast only.
Benjamin Swinburne – Morgan Stanley: I know you said that the favorable conditions continue in 2Q but that is at least I guess technically speaking a little bit of a deceleration. Is that sort of conservatism or anything else you’re seeing? I just wanted to see if those two comments together.
David M. Zaslav – President and CEO: Look, the high single-digit is still a very good number. It’s coming off last year’s (13) as you still have several weeks or months plus of scattered to book and ratings mix certainly impacts that as well. So, we feel good about that number. It’s a solid high single-digit, and again, it’s coming off a big number last year.
Doug Mitchelson – Deutsche Bank: David, I think what stood out this quarter was international. I’m curious how much Western Europe and the U.K. might have been a drag on international ad growth. As strong as ad growth was, it could have been even stronger if those marketplaces were healthier and separately, I think TLC has been pretty impactful on your growth at international this past year. Do you have enough new networks and feeds in the pipeline that you see new growth driver stepping in as TLC’s growth cycles out?
David M. Zaslav – President and CEO: The international business is really accelerating and it’s a number of things. One is the sub growth that we’re seeing and you see that on the affiliate side, but it also reflects itself in the overall reach, and therefore, viewership. So, Discovery is the number one most distributed channel in the world and it grew 10% and our overall distribution grew 16%, so that’s a helper. Just to give you a sense; Brazil grew 766,000 subscribers in the first quarter, that’s more subscribers than the U.S. has added in between three and four years. So, we’re seeing real growth across Latin America, Russia, India and that’s the helper. But more importantly is we’ve become a strong content company outside the U.S. and strength of our brands are really resonating. So, if you go into Latin America where we have on average 11 channels, we have four of the top 15 channels. We have Home & Health, which is essentially the Home & Garden of Latin America and that’s a top network for women. We have Discovery Kids, which is in Brazil it’s the number one cable network in all of Brazil, it’s USA Network of Brazil, but it’s strong throughout Latin America. Discovery, Animal Planet, and we’ve launched TLC, and so you see us around the world building those channels. TLC now all around the world is a strong female network, Discovery getting stronger, Animal Planet getting stronger. Specifically in Western Europe and the U.K., we’ve actually deployed, it’s specific to only a few market, but in the U.K. we’ve been able to grow our overall market share by having a broadcast network there where we – the cost to us is very low because we have our existing content. We also launched a broadcast network in Italy called Real Time, which is a female network, the equivalent of TLC, and that is now the number eight network in all of Italy including the broadcasters. So Western Europe and the U.K. for us has not been a drag at all. We have been able to grow those markets, because we have been able to significantly grow market share and take advantage of a robust advertising market, although maybe not growing we’ve gotten a bigger share. When you look at India, where we just launched a new kids network or Latin America and Russia, where just launched an office and two more channels, we are finding that market share is probably two-thirds of our growth and a third of it is the underlying jet stream of subscriber growth.