David Haslingden

 Fox International Channels (FIC), owned by News Corporation, operates 183 wholly and majority-owned pay-TV channels, and their related online, nonlinear and mobile extensions, across Latin America, Europe, Asia, the Middle East and Africa. The portfolio, in 35 languages, reaches over 300 million unique subscribing households worldwide. David Haslingden, the CEO of FIC and National Geographic Channels Worldwide, explains the reasons for the channels’ success.

 

WS: Tell us about the recent restructure at National Geographic and what benefits the company derived from it.

HASLINGDEN: We’re finding around the world that the traditional windowing of programming across different media—broadcast, pay TV, syndication—is collapsing. It’s therefore becoming increasingly more important, particularly if you’re a channel with a very strong and premium brand like National Geographic, to be able to control the way in which your shows are exhibited in markets, and to ensure that if you are selling your channel as a premium product to a pay-TV platform, that the programming on that channel is not freely available to consumers in the same market.

 

Consequently, our cost of programming is increasing because we have to buy out all windows. And that’s required us to take a much more focused approach in the way we buy programming globally. We’ve really had to bring all of the benefits of our global scale to bear in making sure that when we buy product we buy out all rights and we buy those products globally. That was what was behind the change in our structure, now it’s much more like the structure that our competitors Discovery and HISTORY use when commissioning and buying rights to programming.

 

WS: Speaking of the competition, they don’t have the long-term brand legacy that National Geographic has always had. What continues to give the Nat Geo channels a competitive edge against other channels in the factual genre?

HASLINGDEN: There’s no mysterious answer here. You’re only as good in any particular market as your brand is meaningful in that market. Part of that is legacy and, equally, part of it is contemporary relevance. You’re only as good as the creativity and execution of the way you market that channel to consumers in a given country. And you’re only as good as the quality and relevance and attractiveness of the content that is on your channel. So if you look across our performance against our competitors market by market, you’ll see that in some markets we are handily the number one in our category and in others we’re the number three behind both Discovery and HISTORY. The reason for that in each case comes down to those factors—just how well our programming is resonating in the market, how effective and creative our marketing is to consumers, and how powerful the brand is. I’d add one other element to that, which is distribution: how effective you’ve been at securing broad distribution for your channel and how easily and conveniently accessible your channel is.

 

I don’t think we have any killer edge against Discovery or even HISTORY in any of our markets. I think the brand, as you say, as a result of its legacy and as a result of the ongoing quality of all of the National Geographic products, is the strongest brand in the category, but we, just like our competitors, live or die by the quality of our programming, our distribution and our marketing. Our goal as an operating unit is to excel in those areas.

 

WS: Does your programming strategy focus on balancing big special events against less expensive long-running series—is that still a formula you are finding success with?

HASLINGDEN: That is absolutely a fundamental part of our strategy. You want long-running series that viewers relate to and feel a connection with and you need to punctuate the schedule with iconic specials that are very high quality, very expensive and take a long time to produce—they are not the type of program you can have every week on the schedule, either because we can’t afford it or because there just aren’t enough subjects to satisfy that level of video journalism. But we absolutely believe that we need to have these major tent-pole events that keep reminding our viewers and our pay-TV affiliates what’s special about an organization like National Geographic and a channel like National Geographic Channel.

 

One example is Great Migrations, which we have coming up, and all the initiatives that are built around that show, like our education outreach program, the articles in four of our National Geographic magazines, the six books that we are publishing, all the online resources, the ability to talk to National Geographic explorers in the field as they observe migrations. These big events are initiatives that only National Geographic can do and are ultimately why platforms are prepared to pay a premium to have our channel as part of their offering to consumers.

 

We’d very much like to do more on the series side. In the markets where Discovery and HISTORY do out-rate us it’s almost entirely because they have these long-running series that have engendered a very loyal returning viewership who identify with those shows and enjoy watching them. That’s an area where we have to do more and where I think in the future you’ll see us have more successes, but that doesn’t mean that we are de-focusing on those big events. In fact, every year we’re increasing our investment in these events by 30 or 40 percent.

 

WS: How do websites and digital media help support what’s on the channel and further that relationship that you have with viewers beyond the TV screen?

HASLINGDEN: For a channel like National Geographic, online is a very important tool to enhance the experience of seeing our shows on TV, and that’s the first step. We see online as a medium that is completely integrated into our main media strategy, which is television on the channel. If you take a show like Great Migrations, we will have masses of scientific information that will allow people to dig into the detail of these incredibly moving stories of the migrations that certain species follow. There will be a multitude of still photographs so that you can better visualize some of the extraordinary trials and tribulations these species go through in their migratory journey. You’ll be able to use the Internet to actually chat online with explorers. Also online, we are partnering with the National Geographic Mission to provide a call to action so viewers can donate to help the different species and track migratory patterns around the world. I don’t think our competitors or anyone else offers that call to action to viewers after they watch the show and they are interested to know [more] about the species.

 

I don’t think viewers watch us because we are an organization. Ultimately people watch TV because they are engaged, entertained and engrossed by the show that is on. You’ll increasingly see on our air, particularly on Nat Geo Wild, that a lot of the work we do is built around initiatives that are designed to deal with some of the sustainability issues that relate to the planet and to our wildlife resources. For example, the Big Cats initiative is a great example of this. There was a good article in The Washington Post comparing Discovery’s Shark Week to the Big Cats week we have on Nat Geo Wild. For years, Discovery has aired these shows which paint sharks as desperate killing machines and I have to give them credit, it’s very engaging and entertaining programming and Shark Week—even the most recent one—has been a hugely successful television franchise and very entertaining programming.

 

The approach we take to programming about animals is a lot more focused on trying to get people to understand the very real issues that the planet faces in terms of the survival of these species and how dependent we are on their survival.

 

Sharks are a classic case. While it’s very easy to demonize these animals, their survival as a species is absolutely fundamental to the health of the oceans. People are doing many things around the planet that will jeopardize the survival of the species and I don’t think we are doing enough as an industry to communicate that and to promote calls to action that will help finance efforts to combat the threat these species are facing. That’s why we are doing the Big Cats initiative. You would be absolutely horrified if you saw just how few of these incredible animals are left worldwide. And it’s not just the tiger that you hear a lot about, it’s the lion, the cheetah and the leopard—these species are all really in danger. People don’t understand that and there isn’t enough communication about what people can do to actively help sustain those population.        

 

WS: As viewers watch programming online, are digital brands becoming as important as linear channels?

HASLINGDEN: No, I don’t think they are. The industry seems to be coalescing around the viewpoint that the way that linear and nonlinear channels operate in the market needs to be very carefully coordinated and, ideally, commonly branded. The reason for that is there is incredible opportunity for customer confusion, which is bad for the customers, bad for the platforms and bad for the programmers. What is gradually falling into place, and obviously you see this in the U.S., is that the linear channel programmers and the platforms are working closely together to ensure that the compilation of the linear and nonlinear products are appropriately coordinated and managed. When that’s achieved, you don’t see an unhealthy cannibalization of linear channel viewership by nonlinear viewership.

 

WS: FIC has production facilities in Colombia, Argentina and Italy. Do you have plans for acquiring more?

HASLINGDEN: Yes, we are looking to have more in other parts of the world, but opportunistically. It’s important to have production companies because as our channels evolve in each market, their ability to successfully utilize locally produced programming increases. So having production companies in important markets gives us the ability to produce shows for ourselves [and] also gives us in-house knowledge about the local production market and opportunities. You can look at the U.S. as a fully mature and evolved media market in which organizations like Fox or National Geographic are vertically integrated through the distribution and production sides of the business. We hope that in our major markets we will gradually evolve to that kind of mature and vertically integrated position. So that is why we bought the production companies in the first place, and that’s why opportunistically we would look to buy more.

 

WS: Tell us about the series The Walking Dead.

HASLINGDEN: As traditional windowing of programming across different categories of media—broadcast, pay TV, syndication, VOD and Internet—has been collapsing, channels need to be more actively controlling their content. We’ve decided to partner with AMC on their new, highly anticipated drama series, The Walking Dead. This is going to be an amazing show, based on Robert Kirkman’s best-selling graphic novel by the same name. It is produced by Frank Darabont, who wrote and directed The Shawshank Redemption, and by Gale Anne Hurd, who produced the Terminator movies. It’s an absolutely A-category production team and we hope that this show is going to be as good as AMC’s great hit Mad Men. It is a franchise that FIC will control outside the U.S. and Canada and we are doing an unprecedented global launch for it, premiering the series within hours of AMC’s U.S. launch, quasi-simultaneously in about 120 countries.

 

WS: Despite the difficult economic times, has FIC’s diversified bouquet of channels been attractive to advertisers?

HASLINGDEN: Over the last three years, it’s been a tough time for economies around the world. During this period, advertisers have focused on the value they derive from their media buys and that has really helped pay-TV channels. Our cost per targeted GRP [gross rating point] and our effectiveness as an advertising medium is superior to the broadcast businesses where many advertisers are spending a large proportion of their money. In a lot of markets, this downturn actually helped us because it brought us clients who traditionally have only spent a very, very small portion, if any, of their media spend on pay channels.

 

With the economies improving in many markets around the world, advertising spend is much more buoyant and customers are staying with us. So we are seeing very good year-on-year advertising increases, almost without exception, in our markets around the world. You are right in saying that advertisers see us as a well-resourced group. We have a very large portfolio of channels across a wide range of programming categories and niches, and in pretty much all cases with very strong brands that resonate with audiences of those niches. That is very important because it means that our sales teams have very good relationships with the core ad agencies and customers, and we are building up a track record of providing them with good products and good advertising ideas and solutions, and, as a result, our business is growing.