Weather Channel shaking off DirecTV dispute, focusing on future

Over two weeks have passed since The Weather Channel was dropped from satellite carrier DirecTV after contentious contract negotiations failed.  David Kenny, The Weather Channel’s top official,  remains emphatic about the network’s indispensable public safety value. But he’s looking beyond the conflict and sees a vibrant future for The Weather Channel – with or without DirecTV’s  20 million viewers.

The Weather Company President and CEO David Kenny.

The Weather Company President and CEO David Kenny.

A debate over value

The crux of the dispute between these feuding parties lies in a difference of opinion over The Weather Channel’s worth.

In a letter to customers, DirecTV CEO Mike White said he doesn’t believe The Weather Channel’s programming merits a price increase. (The Weather Channel says it requested an increase of one penny per customer.)

“Our customers tell us The Weather Channel is their fourth choice when looking to access weather information,” White wrote. “They first turn to mobile devices and computers for instant weather information and then to local news sources that have a better grasp on local conditions.”

DirecTV customers also complained about the amount of reality TV on The Weather Channel, White wrote.

Kenny, CEO of The Weather Company – which includes The Weather Channel, Weather Underground and several other weather information entities –   is dismissive of DirecTV’s arguments, and rejected its view people don’t care about his network.

In an interview last Friday, Kenny pointed to almost 5 million visitors to its Web site KeepTheWeatherChannel.com, and 750 thousand complaints to DirecTV. He said  people in remote areas and emergency managers particularly rely on their coverage.

“I think [DirecTV] made a gross miscalculation in how much people value The Weather Channel,” Kenny said. “Sooner or later viewers will demand The Weather Channel on DirecTV or they’ll switch.”

The Weather Channel has waged a very public pressure campaign for DirecTV to restore the network – including full page newspaper ads and calls to Congress, so far to no avail.

Kenny says that the carrier’s refusal to budge must be about more than The Weather Channel.

“[DirecTV's] tone, their take it or leave it attitude, there’s something else at play,” he said.

Kenny noted DirecTV is offering $5 dollars off monthly subscription fees to every customer who calls to complain about The Weather Channel’s disappearance.

“They’ve long said they’re trying to slash costs,” Kenny said  “If they’re willing to give people $60 per year for giving up The Weather Channel,  clearly this [carriage dispute] is bigger than giving up The Weather Channel.”

DirecTV’s White, in his letter to customers, expressed concerns about an industry-wide trend of increasing programming costs.

“As with all TV providers…, we are forced to raise our prices annually due to programmers like The Weather Channel, demanding to be paid more and more each year,” White said. “In 2014, DIRECTV will be forced to pay 8% more for the channels you enjoy, yet, the average increase we passed on to our customers was 3.7%, which was lower than the increase in 2013, and also lower than many of our competitors.”

The Weather Channel’s latest message to DirecTV: You may think we’re not worth it, but then let customers decide and change carriers without penalty if they wish.

“If DirecTV truly believes nobody cares about The Weather Channel, then it should have no problem waiving its punishing cancellation fee for those who must change providers,” it wrote in a full page ad that appeared in the Wall Street Journal and LA Times Tuesday.

Conversation with David Kenny

Last Friday, I spoke with David Kenny over the phone to hear his thoughts on how The Weather Channel is moving forward, with the DirecTV carriage dispute ongoing.  What follows is a summary of key aspects of our conversation….

A commitment to live weather

Confronting criticism that it airs too much reality TV and other taped programming, Kenny insists The Weather Channel has made and continues to make its biggest investments in live weather coverage

“The vast majority of our investment is in the live hour… improving the live hour,” Kenny says. “The bulk of our talent investment [noting the hiring of Good Morning America's Sam Champion] and marketing is in live television.  I see the live weather getting better and better.”

In November, The Weather Channel launched a new branding campaign around the theme “it’s amazing out there”, the cornerstone of the company’s renewed emphasis on real-time weather.  Irrespective of programming, weather information always scrolls across the bottom of the viewer’s screen.

“At a minimum, every time you turn on The Weather Channel, you will get weather,” Kenny said.

Kenny said The Weather Channel is making large investments and partnering with the National Oceanic and Atmospheric Administration and academic community  to improve its “forecasts on demand”  - its high resolution, localized predictions.

And when the weather is severe where you live, taped programming can be dropped, Kenny said.  He noted The Weather Channel has developed technology to air live coverage in some parts of the country – where severe weather may be occurring – while it may continue reality TV or other taped programming elsewhere.

“We will pre-empt [reality TV and other taped programming] whenever necessary to carry weather,” Kenny explained.

Kenny stressed The Weather Channel provides more live coverage than its peers and airs no taped programming between 4 a.m. and 8 p.m. eastern Monday-Friday.

“If you look across networks, you’ll see our coverage at the top in terms of total hours. Some go to infomercials overnight. Our first, second, and third priority is live weather.. as much or more of than any 24-hour network doing news of some sort,” Kenny said.

A role for reality programming

Although The Weather Channel has faced considerable heat from viewers who prefer live weather coverage to taped programming, Kenny defended the place of weather dramas, educational programming and reality TV on the network.

Admitting not every show The Weather Channel has ever run was the best fit, he said taped programming – which is less expensive than live coverage – is needed to “balance good economics with good value to the customer.”

Related, from Slate.com: A longtime Weather Channel fan talks to the network’s president about its new direction.

Kenny pointed out that many of its reality shows are popular and must now fit into its weather-focused mission.

“People complaining to DirecTV are also complaining about missing reality shows,” he said. “Everything  launched from here has to pass a filter of [relating to] weather, natural phenomenon, science and tie to preparation. And, even with that, we will always – without question – preempt if weather is the main story.”

Can The Weather Channel TV network thrive in the digital age, with no DirecTV customers?

To get weather information, millions of people turn to digital devices: from smartphones to tablets to desktop computers.  Weather.com – The Weather Channel’s Web site –  is one of the top destinations for this information.  Is The Weather Channel television network in danger of becoming irrelevant due to digital weather products, including its own?  Kenny doesn’t think so.

“In 2013, 77 percent of all minutes spent with TWC brand were spent on TV. That number goes up in active weather times,” Kenny said. “I don’t buy digital as a substitute. I think it’s a misplaced view.  People who love weather, they’ll hit every source. TV is the only place you can engage with our talent… We’re not going to replicate that online.  We don’t view it as cannibalization.”

He added: “If you go back to the 1990s, [our] baseline [TV] ratings hold in there… and there are spikes around weather. … Digital viewers still come to TV at peak moments like they always have. ”

Yet with the loss of DirecTV customers, The Weather Channel now has access to approximately 20 million fewer viewers than in the past.

No resolution has been reached with DirecTV and Kenny has come to grips that The Weather Channel’s absence from the carrier may be permanent.  But he is unfazed. “When these bullies at DirecTV thought they could make a point, they didn’t understand they’re dealing with a strong and diverse business that can’t be worn down,” he said.

Related:

Soul searching time for The Weather Channel

Weather wars: DirecTV drops Weather Channel, AccuWeather to add channel

DirecTV dispute: Is Weather Channel trying to have it both ways?

Weather Channel urging viewers to pressure DirecTV not to drop network

Weather Channel snags Sam Champion from ABC

The Weather Channel is getting back to weather, sort of

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