Zeiler Outlines Way Forward for Traditional Media Companies

CANNES, April
17: In his keynote speech at MIPTV, entitled “Capturing Digital Opportunities:
Traditional Media Strikes Back,” Gerhard Zeiler, the CEO of the RTL Group,
emphasized the importance for traditional media companies to embrace the
digital future.

Zeiler laid out
the four-point strategy that RTL Group has followed in targeting new media
opportunities—and urged other traditional media players to follow suit.

First, Zeiler
noted, companies should not be frightened by fragmentation: “We should fragment
ourselves before others fragment us,” Zeiler said. “It’s no longer enough to
offer only one strong channel. You need a big flagship channel supported by a
fleet of strong secondary channels.” It’s a model that RTL has followed
successfully in Germany and France, and most recently in the U.K. with the
launch of Five Life and Five US as sister channels to the terrestrial
broadcaster Five.

Secondly,
Zeiler explained, broadcasters should not be scared of new platforms, such as
broadband, handheld devices and IPTV. “They are all about
distribution—new ways of reaching the consumer. We are content and
programming providers, we have to use new technology and we want to be on every
single platform.” Zeiler outlined a suggested route for a new show launch, for
example, a “CSI: Cannes,” he said. The day before a broadcast launch, a show
can be rolled out on pay VOD. On the free-TV premiere date, the show can also
be launched on broadband and mobile TV platforms, free and ad-supported.
Immediately following, the show can be added to advertiser-funded VOD
platforms, and then reruns can be played on other linear channels within a
broadcaster group. Once the entire season has aired, the show can be launched on
DVD. The accumulated viewership, Zeiler says, will be larger than what one
single broadcast could ever hope to achieve.

Zeiler’s third
point in his four-pronged strategy is “wag the long tail”; broadcasters must
learn to find ways of making money out of brands.

Lastly, Zeiler
noted, companies must diversify: the most successful media companies will have
a mixed business model comprising revenues from advertising, subscription,
transactions and content sales. Zeiler noted that he would eventually like to
see RTL Group’s revenues be an even 50/50 split between advertising and other
sources.

Wrapping up his
keynote, Zeiler emphasized: “Moving into the digital world there is one
constant, and that is that size matters. The stronger the presence in the analogue
world, the better the chance of succeeding in digital.”

Zeiler also
took time to comment on the heading of his keynote—“Traditional Media
Strikes Back.” “I’m not Darth Vader!” Zeiler joked, suggesting an alternative
title for the speech: “My Big Fat Digital Future.”