Simon Sutton

April 2008

With its slate of award-winning, buzz-generating original content, HBO has become one of the most distinctive channel brands in the U.S. As president of programming distribution and international at the premium network, Simon Sutton is looking to make sure that HBO has an equally high profile on the international market. Sutton, who joined HBO after several years at MGM Worldwide Television Distribution, oversees joint-venture channel operations in about 50 markets, among them HBO Asia, HBO Latin America, HBO India and HBO Romania. HBO is also working on the rollout of on-demand and mobile services, and recently reclaimed the global-distribution rights to its catalogue of original content.

WS: What was HBO doing on the international market when you joined the company?

SUTTON: Our product was being distributed by a collection of different companies: Warner Bros., Granada, Channel 4. We had a selection of minority interests in channels and the home-video business was doing fine. And that was about it.

WS: What was the strategy you put in place?

SUTTON: Now, all our programming is handled by HBO. It’s not just the scripted shows, it’s also our documentaries, our boxing. We’ve done a lot on the digital side. We have over 300,000 subscribers to the cell-phone services internationally. On the channel front, we now have majority ownership of HBO Asia and we’re looking at a number of other things in that area as well. Home video continues to do fine.

WS: Why did you choose to bring distribution in-house?

SUTTON: Warner Bros. is a fantastic distributor, but our programming is a little different, it’s not broadly commercial. We find we have a very different customer base. We often go to channels that maybe wouldn’t have an appetite for a broad, commercial product. We actually do better with more niche channels. Let’s take public broadcasters in Scandinavia; they really like our product. By focusing on a slightly different customer base, it’s really been to our benefit. And being in direct contact with a lot of our clients, as opposed to going through third parties, has enabled us to control our rights more closely and enabled us to look at launching other businesses with the rights we have.

WS: How do you manage the windowing of your product across your own channels and third-party outlets?

SUTTON: If our channels are buying the programming, it’s because they’re the most appropriate customers for it and they’re willing to pay the appropriate amount. We don’t favor them per se. It’s a free market for the shows. HBO Latin America, for example, does buy our programming in Latin America, and that’s because they value it.

WS: What led to the decision to increase your stake in HBO Asia?

SUTTON: We’re keen to expand our business internationally, particularly in fast-growing countries, and the Asia footprint covers India and a number of other markets that are fast growing.

HBO Asia is interesting because it offers markets in hugely different stages of development, so a couple of those markets—Singapore, Hong Kong—are very technologically developed, and those are the kinds of places [where] you’ll see the full array of offerings we do. HBO Asia operates an on-demand service in Hong Kong. Where the markets can support that, we have done it.

WS: How is HBO doing in Central and Eastern Europe?

SUTTON: Doing great. Poland is the big market of that footprint. We continue to expand it to other territories. But I must say the territories we’ve been expanding to are generally a little smaller.

WS: What are your plans for Western Europe?

SUTTON: We do have cell-phone services in most of the Western European markets. We’re on a number of different platforms, predominantly the Vodafone companies. We launched by offering linear channels of our original programming, Sex and the City, Six Feet Under, Curb Your Enthusiasm, but we’re trying to transition that now to an on-demand service on your handset. Rather than switching on and coming in to the middle of an episode, you can choose which episode you want to watch, watch it coming in to work, pause it and watch the second half going home. That’s what we’re moving to. We’ve gone from zero subs to over 300,000 in just two years. It’s been nice to play in that marketplace, just to understand more about what’s going on.

Then we’ve got the branded on-demand service in the U.K. that we’re looking at taking into a few other places. But in Western Europe we predominantly license, and that’s where we see the most of our revenue for the moment.

WS: How’s your Latin American business performing?

SUTTON: Our service continues to grow faster than we expected, even though we expected it to grow quickly. The real driver for us there has been the original programming. It’s really succeeded with shows such as Epitafios and Mandrake, and the fact it has original programming has really marked it out as different from any other movie service.