AMC Networks’ Josh Sapan

Today’s media business is in constant flux, with changing viewing habits, new platforms and more and more players producing content—leaving consumers overwhelmed by so much choice and many companies forced to change strategies.

In response to this continually evolving environment, AMC Networks is placing its bets on high-quality, innovative programming and providing it to viewers on its linear channels, as well as going directly to consumers with its own subscription streaming services.

Josh Sapan, AMC Networks’ president and CEO, has seen how standout shows can help elevate the visibility of a channel—Mad Men, Breaking Bad and The Walking Dead all pushed AMC above the fray, transforming it from a classic-movie channel into a destination for must-watch series.

Sapan is making sure his programming teams continue to offer content that can’t be found elsewhere. AMC aired Dietland this summer, and The Little Drummer Girl will premiere this fall. Sister channel SundanceTV has been particularly open to storytelling from outside the U.S., including Deutschland 83 and Liar, both of which have new seasons in the works, along with true-crime docuseries such as Jonestown: Terror in the Jungle. BBC America, a joint venture with BBC Studios, has offered U.S. viewers some of the best of British programming, including Doctor Who, as well as buzzy original series Orphan Black and Killing Eve. IFC is home to independent films and offbeat comedy series, while WE tv has become a destination for unscripted fare.

To reach viewers on all of their devices, AMC Networks has been increasing its offering of SVOD services. Alongside Sundance Now, Shudder and the recently launched AMC Premiere, the company has acquired RLJ Entertainment, which operates Acorn TV and UMC (Urban Movie Channel), and is a minority shareholder in BritBox with the BBC and ITV.

Sapan is also spearheading the increase in output from AMC Studios in an effort to own and control more IP, which feeds the company’s linear and nonlinear platforms in the U.S. and around the world and is sold to third parties. During a far-ranging conversation in his office in Manhattan, Sapan talks to World Screen about the strengths of AMC Networks, the use of data in programming and the value of distinctive content in a crowded and evolving market.

WS: In this ever-changing media world, how are you positioning AMC Networks?
SAPAN: The approach that we are taking is to be more of a studio and own more of our content, which gives us control over how our content may be rendered. We also want to be in the direct-to-consumer business more significantly and make our channels as vital as they can be and keep changing what they are doing. Our channels grew subscribers over the last year in the U.S. at a time when most others did not. That’s a function of a couple of different things: we are carried more widely on certain MVPDs than we have been in the past; and we are carried more widely in the new virtual MVPDs than any other independent programmer (meaning, programmers not aligned with a broadcast network). We have more distribution and penetration among the virtual MVPDs, and we are in fact number one. We think this is because what we do we do very well, and the price that we offer is very attractive. These are the basics of our business, and what drives it all is great content. So we think it’s important to operate with discretion, ingenuity, innovation and particularly a fresh approach to both format and story, which can energize a business enterprise. Story comes in all sorts of forms; we’ve seen it in the past. Zombies were once considered perhaps marginal, but, in fact, they weren’t marginal at all. So that approach is important for us for growth.

WS: Tell us about AMC Studios.
SAPAN: We began AMC Studios some nine years ago with a mind toward owning and controlling content as we began to diversify our business so that we would not be limited to our U.S. linear cable channels. We also expanded internationally some years after that, and we were able to take our IP to a greater part of the world. There are a significant number of shows now coming out of our studio that we own, and we can make decisions about where everything goes now and in the future.

WS: How did AMC Premiere come about?
SAPAN: We made a decision to be in the direct-to-consumer subscription-video-on-demand business five or so years ago in a few different ways. We began with Sundance Now and Shudder and developed the technology on our own; we intentionally set up the staff to work in another location (they are in a WeWork building), remote from us, because it’s such a different business. We didn’t want them to suffer from traditional media business oversight! We thought it was important to build up a whole different orientation. AMC Premiere is the most recent service we launched. In between, we also invested in a company called RLJ Entertainment that operates the SVOD services Acorn TV and UMC (Urban Movie Channel). We also made an investment in BritBox with our partners at the BBC and ITV.

AMC Premiere came about through our relationship with Comcast and our mutual desire to do something different with the current formulation of what is highly desirable content on linear cable channels, as well as to have a commercial-free option. That was the beginning of it. It’s a species of its own; essentially, if you want to use fancy terms, it is an “in-ecosystem” or MVPD-centric subscription-video-on-demand service that gives you a different form and flavor. We are expanding its composition, so there is stackable, bingeable material that is available sometimes before [it’s available on] the linear channel. It has recently launched on YouTube TV and will continue to undergo an evolution, as all things do.

WS: How do you decide what goes on AMC Premiere and what airs on the linear channel?
SAPAN: That is an ongoing work in progress and we’ll continue to make determinations of where we get the most value, where consumers get the most value and where our MVPD partners get the most value. That will be a decided evolution; it will very likely change all the time, and is meant to change all the time, as we consider all the factors against those constituencies.

WS: How are Sundance Now and Shudder being received by consumers?
SAPAN: Very well. They have both been growing nicely, and they are particularly acclaimed because their constituencies don’t have much that serves them on a dedicated basis. There are pieces of what they do available elsewhere on television, but if you like high-quality television of prestigious and sometimes foreign origin, Sundance Now gives you a great collection of it. If you’re interested in the horror genre, Shudder is for you. We just began a Shudder podcast. The people who are fans are big fans.

WS: Big data is revolutionizing advertising and the Don Drapers are rightfully, or wrongfully, being pushed aside by data. Is data becoming very important in programming and in platforms’ relationships with consumers? Do AMC Premiere, Sundance Now and Shudder also rely on data?
SAPAN: The answer is yes, yes and yes! The rules are pretty fundamental but different for advertising than they are for programming. On the programming side, what we see in evidence is the ability for an algorithm to learn your preferences, your likes and your desires, and I think it’s going to undergo a really interesting evolution. We do look at what people have watched and then serve up what we think they might like and offer recommendations for them based on past behavior. The other thing that is occurring that is pretty interesting is companies are doing a social media “scrape” and then are making determinations of what you might like based on your social media habits, which is a different way of getting information about you. Those two things are profound. They probably have their limitations, at least today, but I don’t think they will go away; they will become ever more advanced. I also think there is one other piece of it, which is, at least in program selection, the more Don Draper part of it, although it’s not advertising, which is—may I ask you, how do you decide what programs to watch?

WS: We have cable, so we run down the EPG, and if we don’t find anything we go to the Amazon Fire TV. If we’ve heard about a show, but we don’t know if it’s on Netflix, Hulu, Amazon or whatever, it takes us 20 minutes to finally find it!
SAPAN: I’ve heard some crazy statistics, and the average time of making a television decision among a certain demo was freakishly long. Oftentimes it’s so time-consuming that we quit before we start.

WS: It’s getting increasingly difficult to find shows.
SAPAN: If I’ve already heard of a show or read a review, that could be of interest. If it’s suggested to me by a friend or someone whose taste I rely on, that’s of the most profound importance, so the human recommendation is, at least today for me, better than a programmatic recommendation. If someone says, “I know you and you are going to love this,” I feel there is a lot of subtlety in that—and that is nowhere in an algorithm. We have Killing Eve on BBC America. When I say to people I know, “Watch Killing Eve,” I can say with greater certainty that members of your family will like this show more than almost any show I’ve been involved in, because it’s not only well done and well rendered but fun and fanciful. Personal recommendations trump everything.

WS: What is AMC Networks’ strategy for selling content to third-party streaming platforms? Has it changed over the years?
SAPAN: It has not changed substantially over the years, but I keep using the term “evolution.” Historically, we’ve been careful to protect the sanctity of the window that MVPDs have so that they have it in a meaningful way alone—that’s been a pretty expansive window, and we arrived at that decision early. We have sold selectively to third parties in the U.S. and elsewhere. That has been rewarding for us economically, and it’s put us in pretty good stead with all those partners. There is nothing to suggest that we would do it differently in the future, but since we now have our own subscription-video-on-demand services, we have the opportunity, when and if we deem it appropriate, to keep shows to ourselves. And there is, of course, a question of money and scale and reward and momentum, so all of that is very much in the consideration of the entire media world, including in major transactions that are occurring as we speak.

WS: Are you also selling your programming internationally?
SAPAN: Yes, we are. We operate as a studio and as a cable channel company, so we sell programming everywhere across the globe—to free to air, to cable, to ourselves, to subscription video on demand—and it all varies by territories.

WS: And those revenues are doing well?
SAPAN: They are doing very well; they are perhaps among the most significant growth trajectories of our company. Happily, our content has been well received in those markets, and I think it’s fair to say that our company name in front of it has stood up to a particular reputation, so people are interested and prepared to do business with us because there has been a consistency of quality and recognition to what we’ve done.

WS: What have been the benefits of the investment in BBC America?
SAPAN: They have been quite abundant. Number one, the channel has succeeded perhaps beyond our expectations in terms of expanded U.S. distribution and increased advertising. The programming we’ve done with the BBC has been spectacular, and that relationship has been wonderful. It has borne many things, including the great franchises they have that we have been the beneficiary of, including Broadchurch; we get Idris Elba to be on television in Luther; Planet Earth is quite well-known and Blue Planet II has recently been nominated for all sorts of awards. As an aside, I recently saw a play on the name Blue Planet. It was front page, above the fold, in the New York Times reporting on the World Cup, and the title was “Bleu Planet.” It was a reference to the French [soccer] team who wear blue shirts, but, of course, it was also a reference to the TV series. So it struck me that this show was sufficiently well-known and in common nomenclature that the sports section of the New York Times would choose to reference it in a pithy headline.

Also, the channel has developed the original series Orphan Black and, most recently, Killing Eve. It’s nice to note that two of the women nominated for best actress in a drama series at this year’s Emmys are from BBC America shows: Tatiana Maslany in Orphan Black and Sandra Oh in Killing Eve. We are also minority partners in the BBC/ITV streaming service, BritBox. So we have an abundant relationship with the BBC and we co-produce significantly through our relationship with them, including series such as McMafia and The Night Manager.

WS: How are the international businesses doing, and where do you see the potential for growth?
SAPAN: They are doing very well. We are expanding particularly in Africa and in the Middle East, new areas for us, and doing well. Where we’ve been, we have degrees of maturity, but our businesses are undergoing evolution and growth. It’s wonderful to see our footprint expand into new countries and regions, and it gives us a view of the world that is intimate as opposed to remote. So when we do business and expand into streaming services or program sales, we have international exposure and visibility.

WS: One approach to programming has been “less is more,” quality versus quantity. But we’ve been reading headlines lately that some services are going in the other direction—“more is more,” higher volume, more variety. Which, in the long run, do you feel is the best strategy for your businesses?
SAPAN: I wish I could give you a good pithy answer! I think “the best” is the best answer, which is to say, there is going to be increasing abundance by definition because of the fact that companies that were not fundamentally in the TV business have moved into it for multiple reasons. We know who they are, and there are new ones coming, so the options and alternatives will increase. So, the answer for someone who primarily programs for a living is that you better be very good and get noticed, because the choices will become increasingly abundant. We came from an environment of relative paucity, and now people talk about the second “golden age” or “peak TV” or “there is too much on and I don’t know what to watch.” What is curious is that people don’t refer to books that way. They don’t say “I haven’t heard of that book, there are too many books to read.” Of course, there are too many things to read, by definition. Now, publishing is a bad analogy because it’s a lower-margin business. But as it relates to TV, it doesn’t mean that services can’t support abundant content production, as long as the economic systems are intact. It’s a consumer experience in terms of our ability to survey the landscape and know what we want to watch. Our frame of reference is that we used to know nearly everything that was on because there was a paucity; I don’t think it suggests that systems are burdened by too much, as long as the systems are intact. When I say systems, what I mean is that we have an economic system in our company and it works and we have a 30-plus-percent-margin business. Premium services have an economic system. Studios have an economic system. Subscription video on demand is an economic system. Free to air is an economic system. Tech companies have an economic system; they may offer content at no charge, or they may offer it with free shipping. But it doesn’t mean that because one thing prospers another thing is going to die. It means that there will be an adjustment in format and content. I think that’s what’s going on in the larger world.

WS: What challenges and opportunities do you see for AMC Networks in the next year to 18 months?
SAPAN: The biggest opportunities are in a combination of content and interface. When people find things that delight them. In my case, it’s voice recognition because I don’t like to press buttons, and when that works, I think, “This is the greatest thing in the world!” That, in combination with great content, is a delightful thing. That’s not the end of it; we’re at the beginning of watching socially. It was interesting to observe the phenomenon of the World Cup and the watch parties and the joy that people find in doing something together, which media has always been a big part of. Some of the current interfaces don’t invite that. I don’t know if your 20-year-old goes up to her room, goes under the covers and disappears with a sea of machines. That’s my experience.

WS: But there is still the desire for a communal viewing experience.
SAPAN: Interactivity is an interesting part of tele­vision that has not yet been explored. People manage their social media accounts in a highly interactive way—they post stories, they share posts. That has not yet crept into television in a meaningful way, but it seems to be on the horizon. It’s interesting, and perhaps to be revealed, and I do think that on-demand selection and recommendation, which has great benefits, has left shared experiences on the sidelines. One sees certain signs of that occurring, not just in the easy examples of worldwide sporting events or news events. I think people—this is a personal opinion—have an appetite for doing things together. The current media construction has left it on the side, which is not to say it hasn’t done other things that are wonderful, but there is a big opportunity for [interactivity], to render it in a surprising and fun way, so we’ll see.