Discovery Hopes for Payoff on Crime Channel
Tuesday, November 27, 2007
Discovery Communications abandoned plans to sell or seek an equity partner for its Discovery Times channel and will rebrand it as Investigation Discovery, focusing on crime and forensics programming, the Silver Spring company planned to announce today.
To program the new channel, Discovery plans to draw on hundreds of hours of crime shows in its library, such as "The FBI Files" and "Most Evil," the company said. Discovery is also in talks with CBS, to acquire episodes of "48 Hours," and NBC Universal, to acquire episodes of "Dateline NBC." Discovery plans to produce 200 hours of original programming next year, said John Ford, chief executive of the channel.
The company aims to rebrand the channel Jan. 27. Discovery Times, which is seen in 52 million U.S. homes, was launched in 2003 as a joint venture between Discovery and the New York Times Co., which exited the partnership last year.
Discovery had been seeking a new partner for the channel and was in talks with CBS earlier in the year, discussing plans to sell its half-ownership of the channel and gain access to programming such as "60 Minutes." Discovery chief executive David M. Zaslav said those talks failed to progress.
At the same time, Zaslav said, Discovery began removing crime-oriented programming from the Discovery Channel because he said it no longer fit the flagship channel's brand.
The programming was moved to Discovery Times, which was in need of shows, but essentially has been idle since the Times Co. left. Within months, Zaslav said, Discovery Times's Nielsen ratings rose from an average of about 0.1 to as high as 0.7, representing fewer than 1 million viewers.
Those numbers are lower than Discovery's most popular channel, the Discovery Channel, which averages a rating of about 0.9. While the ratings pale when compared with top-rated network shows, such as "American Idol," which can score a 10 rating, they suggested to Zaslav and Ford that the channel could make a business in the crime niche.
"We thought, if we could rebuild Discovery Times with a programming vision that viewers would connect with, that it could be a very strong economic engine," Zaslav said in an interview yesterday, noting that the CourtTV and A&E channels have removed some of their crime and forensics programming, opening the door for Discovery. "Investigation Discovery allows us to be the home base for a huge number of people around America who love this content as others are walking away from it."
Discovery said the Discovery Times channel is profitable and has the highest advertising growth of any of Discovery's ad-supported channels. Even though Discovery plans to pay for new programming, the heavy reliance on library -- or rerun -- programming will keep the channel's operating costs low, Zaslav said.
The change is part of Discovery's ongoing overhaul under Zaslav, who is nearing the end of his first year as chief executive, having come from NBC Universal to replace former Discovery chief executive Judith McHale. Zaslav has engineered an active first year that has seen the shuttering of all Discovery stores, a 25 percent reduction in the company's workforce, the rebranding of the Home channel as Planet Green and the acquisitions of TreeHugger.com and HowStuffWorks.com.
Discovery Times is one of six Discovery networks -- the others being Planet Green, Discovery Kids, the Military Channel, Discovery Science and Discovery Health -- that reach 52 million to 68 million U.S. homes and need a plan for growth. Planet Green was the first to get a makeover, Discovery Times is second and the rest will follow, Zaslav said.
Discovery Times began life as a joint venture between Discovery and the Times Co. in 2003. Each company invested $100 million to launch the channel, which produced long-form, in-depth programs on topics in the news, often featuring Times staff members. For example, Times columnist Thomas Friedman hosted an "Al Qaeda 2.0" program.
But last year, Times Co. Chairman Arthur Sulzberger Jr. said his company realized that news consumers want their video in short-form on the Internet rather than in long form on television. The company bought out its interest in the channel and took an $8 million loss in the process.