Tom Keaveny

***Tom Keaveny***With the rollout of TLC in Asia this month in place of Discovery Travel & Living, Discovery Networks Asia-Pacific bolstered its lifestyle portfolio in the region and set up what executive VP and managing director Tom Keaveny sees as a strong second flagship brand. With its portfolio of seven networks—and slew of local feeds—DNAP is driving ad-revenue and audience gains, while taking the lead in high-definition production and in 3D.

TV REAL: Discovery Networks International’s president and CEO, Mark Hollinger, has said that a goal for the business is moving from a 70:30 affiliate revenue to ad revenue split to 50:50. How are you looking to increase your ad-sales business?
KEAVENY: We’re launching more feeds into different markets. So far this year, our ad sales growth in the first half is 40 percent. We’ve seen significant growth, and that’s being led by India, Australia—everywhere is doing well. We’re a triple threat—we can take local advertising sales, we can take pan-regional and we can take global. As we’re seeing the upsurge in marketing activity, we’re able to take account of it in three ways. Plus, we’re able to do more national feeds as well. We’re optimistic and we’re seeing that optimism turn into cash. A lot of that is a function of market growth. We’ve got great sales teams. And it’s also a function of audience growth. Our audiences have grown 21 percent this Q2 2010 versus Q2 2009. So ad sales are growing, audiences are growing, and penetration is increasing, plus you’ve got the local ad-sales feeds.

TV REAL: Following the rollout of TLC, are their other U.S. Discovery channels that you’d like to bring to Asia?
KEAVENY: We’ve got this enormous collection of brands, but it’s a question of putting the right brands and the right content in play. So yes, going forward, I’d be very keen on launching networks where we think there’s a demand.

TV REAL: What are your plans for expanding your business in India?
KEAVENY: India is an incredibly dynamic and competitive marketplace. We already successfully operate six channels there— Discovery Channel, Animal Planet, TLC, Discovery Turbo, Discovery Science and Discovery HD World. Discovery Networks Asia-Pacific has applied for licenses to operate five more channels in the country: Discovery Kids, Discovery Home & Health, Investigation Discovery, the Military Channel and Discovery 3D, which puts us in the position to launch new brands in the marketplace when opportunities arise.

TV REAL: What is the strategy for 3D?
KEAVENY: Our 3D joint venture with Sony and IMAX will launch in the U.S. next year. I was in Japan recently and we were showing it to some clients up there and our 3D tape is spectacular. It suits our content more than any other genre. We’re having lots of conversations with affiliates and production companies. We’re going to be doing a lot of 3D production going forward. I’m enthused about it. In the short term, we’ll be supplying content to cable and satellite operators who will be in a position to offer a 3D service. Over time we’ll launch our own channels when there is sufficient content to support it. I think 3D has a very real future, with the right content, done in the right way. But there is a massive learning curve, because where you film and how you film in 3D is very different than HD and SD.

TV REAL: And the HD rollout is progressing well?
KEAVENY: We’re seeing continued take-up of HD. It’s been in the region for five years. We’ve got a big library of HD. The majority of our productions in Asia are being filmed in HD. We’re pleased more channels are joining in the HD environment, because you can’t just rely on one or two channels to do the heavy lifting, you need an array of channels. The other important thing is, we do take HD seriously—we don’t up convert, we film in pure 1080p. A lot of people up-convert.
The [markets with the] highest index of HD ownership [worldwide] are Australia and Hong Kong. But Asia Pacific only indexes at 90. There are significant markets like Indonesia, Pakistan, Thailand, that aren’t at the same level. But Indonesia, Pakistan and Thailand are massive countries—that means there’s massive potential going forward.

TV REAL: What are your overall goals for the Asian business in the short term?
KEAVENY: From a business perspective, our goals remain the same: to drive revenue, increase profitability, grow audience, and continue to identify new growth opportunities for our company. In order to do this, we focus on our strengths—delivering fantastic value for our advertisers and affiliates, by providing the highest quality nonfiction content and continuing to build deeper relationships with our viewers. We are having a very successful year. We are already number one (our flagship network is the number one international channel in Asia-Pacific reaching more than 129 million viewers every month according to Peoplemeter; we’re the number one in PAX; we were named Cable & Satellite Network of the Year at the Asian TV Awards) but we are looking at strengthening our position. We have just launched TLC in the market on 1 September and are looking to it becoming our second flagship channel here, and always exploring different avenues to showcase our content, whether it is online by working with partners like Baidu, or 3D.