Darren Childs

October 2007

Darren Childs has spent his entire career launching channels in various parts of the world—perfect training for his current position. As managing director of global channels at BBC Worldwide he overseas a portfolio of 18 wholly owned and joint-venture channels that offer a mix of entertainment, factual, learning and children’s programming to more than 288 million homes around the world. Childs is also charged with rolling out a new bouquet of thematic services around the globe: BBC Entertainment, BBC Knowledge, BBC Lifestyle, CBeebies and BBC HD. Among the first new channels to debut were Cbeebies and BBC Entertainment in India and both have been very well received. Childs is counting on the strength of the BBC brand and its reputation for quality programming to open cable and satellite operators’ doors in other territories as well.

WS: What led to the decision to rebrand and expand your channel portfolio last year?

CHILDS: There were a lot of reasons behind it. When I arrived 14 months ago and started looking at the business that currently existed with BBC Prime, BBC Food and several joint ventures, it just seemed that for a company with the assets that the BBC, its ability to get great content, and the reputation of its brand globally, we had a bit of a lack of ambition for what actually could be achieved. And yet we had all the assets in place that could make us a much more significant player internationally.

We made a decision that we wouldn’t [launch a channel] just to replicate something that existed. We would only do something if we saw, in a specific genre, that we could either be number one or number two in a market. That’s the strategy we put in place. One of the key things [about] the uniqueness of the BBC when you compare it to other studios or other content producers is the sheer volume of its high-quality content. We make 20,000 hours a year of content: 12,000 hours of entertainment and 8,000 hours of news. There isn’t another company on this planet that I can think of that can offer a six-channel bouquet from preschool kids’ content to the best news channel on the planet.

[The BBC is] predominantly perceived as a news brand. I’m hoping my legacy here in five years’ time is that people will have a better understanding about all the capabilities of the BBC, particularly in the entertainment and information genres. And I think we’ve developed a bouquet of services that can actually deliver that as well. I’m hoping that we can over time change the perception of what the BBC is about.

WS: What is your strategy in Asia?

CHILDS: We launched in Korea. We followed that up with Malaysia, we’ve been in Singapore for quite some time. And we had a very small deal with Now in Hong Kong for a single-channel service. We’re in the process of rolling our six-channel bouquet out across Asia. The first instance of that was Singapore on July 29. We’re launching into Asia two new channel brands that have never been seen before, BBC Knowledge and BBC Lifestyle. We’ve just closed a deal in Hong Kong [embargoed, please check before printing] and before this goes to print we probably will have launched there as well. That’s all four channels, five in Hong Kong including BBC World. So the Asian distribution is going extremely well.

One of our worries was that there are a lot of channels over there—did people really need new channels? American networks pretty much dominate the global multichannel market and I think there’s a real demand for a counter [offer] to that and the BBC is probably in the best position to take advantage of that. We’re really excited about how our new products are being received. We’ve had to push launches back because logistically our launch schedule is completely full until the end of this year.

WS: How’s your business in Latin America?

CHILDS: It’s an interesting one actually. We’ve got two joint-venture networks there, Animal Planet and People + Arts, with Discovery. And we have BBC World there. We don’t have a branded BBC entertainment service there at all. We’re fixing that quite quickly. I set up an office in Miami and we hired a senior management team to develop opportunities for us in Latin America. We’re in the very sensitive final stages of pulling something together, which we can’t talk about yet. There’s a huge growth opportunity there. There’s certainly resonance around our content. We need to get into the Spanish-language market. We’re also looking at Hispanic North America. There’s a huge opportunity for us there and we’re going to develop those two businesses side by side.

WS: How is your U.S. business at the moment, and how are you looking to build it?

CHILDS: BBC America is doing quite well. It’s a story of great distribution growth—56 million homes and growing. We’re very happy with our increased reach. Garth [Ancier, president of BBC America] came in to run the network. We are very much focused in the U.S. on a number of initiatives. We’ve spent the last four or five months defining a new editorial strategy which is going to update the network, make it more reflective of contemporary Britain, rather than the older-skewing shows that have been on the air for quite some time. We’re focusing on getting the best of the BBC’s content onto BBC America, rather than it being on other people’s networks.

We’re making a lot of investments into news. We’re launching the first live 7 p.m. news broadcast coming out of Washington D.C. later this year. We’re also focusing on a lot of the non-linear applications, building a very deep user experience for our customers which is not just around the linear channel—it extends into branded video on demand and other services that we can deploy to digital cable and satellite. We need to get that right before we start looking at additional brand extensions. We are looking at the Hispanic North American piece. Will we start launching on other channels there? I think we need to get BBC America into the position [we want it in]. Garth is leading that charge.

WS: Why has BBC World struggled so much with distribution in the U.S.?

CHILDS: I think it’s primarily due to timing. BBC America was very lucky. We launched at the beginning of the digital wave, when people weren’t interested in digital and everyone wanted to stay on analog because analog was where the market was. We were very fortunate to secure digital carriage across the whole marketplace and we’ve just seen that grow. Analog gets turned off, digital grows, so have our subscribers, so has our subscription revenue. I think World didn’t take that opportunity and I’m not quite sure why not. Now [the U.S is] a seriously competitive market where, particularly in cable, we’re seeing a huge capacity squeeze. The cable operators want capacity back to launch high definition services. That’s one thing we’re looking at doing—launching a high-definition version of BBC America. Now there’s an abundance of domestic news channels and there’s very little capacity to carry another one. Even though [BBC World] has some distribution, we are working hard to broaden that. But it is quite difficult.

WS: What are the major challenges you face in trying to expand the distribution of your other services worldwide?

CHILDS: Whenever you try to launch new channels [the platforms] always tell you they don’t have any capacity, which is their stock answer I think! Capacity is becoming much more available. It tends to be less of a capacity driven issue now and more of an ARPU [Average Revenue Per Unit] driven decision. Pay TV is totally focused on ARPU and driving revenue. You cannot build a global multichannel business without understanding the economics of how pay television works. What we’ve been able to demonstrate is we bring something new and fresh, which would give operators the ability to increase ARPU. We can demonstrate to them that these are channels and services that their customer base wants. The platforms don’t want to spend any more on content but they will do it if they think customers want it and they can justify things like a price increase. Everyone is delivered by ARPU targets now and they’re becoming increasingly important.

WS: Are you using those alternative platforms to launch your brands into any markets?

CHILDS: The most desirable [strategy] is to launch brands at the broadest possible reach, which is the channel side of the business. It’s got much higher penetration and reach in viewership than mobile services, for example. For us that’s the first port of call. But if we’re in a position where we can’t get one of our brands launched in a full linear way, because of capacity issues or technology issues, then we are quite prepared to launch them on alternative platforms, on their own. For example, one of our brands could live quite happily on mobile only for a few years. But our objective is to get all six brands into each market simultaneously, so there is a multi-brand experience around the BBC content. It may just be across slightly different technologies and different platforms.

WS: Do you think it’s possible to successfully launch a new international channel today with the backing of a huge brand like the BBC?

CHILDS: I would not want to be launching a network that doesn’t have close ties to a very rich upstream content source. There are a number of players out there that aren’t tied to a content [producer] and I think it’s going to be tough. But if you do have fantastic content and you’ve not taken full advantage of that, there are opportunities. But there aren’t that many opportunities left, nor are there that many people with the rich archive and content resources to do it. The other thing is, people are launching more non-linear applications, on Joost and others, that seems to be where a lot of people’s energy is going. But it’s an unproven revenue model. It’ll be interesting to see who ends up surviving through that.