Discovery CEO Discusses Streaming Services and Skinny Bundles

CNBC’s Julia Boorstin interviewed Discovery CEO David Zaslav this morning about the current media landscape.

Boorstin questioned whether Discovery was worried about losing revenue and viewers to media giants. Zaslav pointed out that after acquiring Scripps Networks Interactive last March for nearly $15 billion, Discovery is the second biggest TV company in the U.S. The Discovery Inc. umbrella includes channels like Discovery, Food Network, Investigation Discovery, HGTV, TLC, and Travel Channel. Their unscripted content covers crime, travel, home, and food.

Zaslav called Discovery’s programming a way of “powering people’s passions.” Rather than competing directly with scripted content providers like Netflix, HBO, or Disney, he sees these services competing among themselves, and unscripted Discovery content serving as a complement.

Discovery has “very quietly become the leader in sports outside the U.S.,” according to Zaslav, due to their recent golf addition, plus cycling and Eurosport coverage. On January 1, Discovery launched Golf TV outside the U.S., which gives access to the PGA Tour and European Tours, as well as exclusive content featuring Tiger Woods.

When asked about the competition for smaller, more niche bundles, Zaslav said that he’s sees a future for Discovery’s unscripted content because no one else is offering it. Because they also own all of their content globally, Zaslav suggested the possibility of offering it through Apple, Amazon, or through their own. There have been rumors of Discovery offering their own streaming service, but Zaslav did share any details

The company has embraced streaming bundles. They launched on both Hulu Live TV and Sling TV in November, after already being a part of Philo, PlayStation Vue, and AT&T TV NOW. They also are available on-demand as part of Hulu's Limited Commercials Plan. Currently, Fubo and YouTube TV are the only major streaming services that don’t carry all of the company’s channels.

Zaslav said that as people move towards skinny bundles, Discovery is well positioned because they have HGTV and the Food Network, two of the top channels for women. He feels that these skinny bundles are financially better for Discovery than traditional models. He shared that in Brazil, while only 5 of their channels are carried, on a 30 channel subscription bundle they make up 85% of the subscription revenue.

Finally, he shared Discovery will continue to let larger companies attempting to aggregate all different programming fight over expensive scripted and film content. Discovery will continue to target viewers who are passionate about specific subjects, like golf or food, and willing to subscribe to a service that will give them depth in that interest.