October 3, 2019 • 41 mins
In this week’s episode, Bob sits down with David Zaslav to learn how the Discovery CEO and President grew a network of just three channels (Discovery, Animal Planet and TLC) to become an international media powerhouse. Learn why David believes brands shouldn’t cater to everyone, how he’s been strategizing for a future when “people can watch anything on any platform,” and what high school tennis taught him about outworking the competition. Plus, why David prefers Shark Week to Puppy Bowl!
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Episode Transcript
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Speaker 1 (00:02):
You're listening to Math and Magic production of I Heart Radio.
As a lawyer, I knew it wasn't gonna work when
I was writing prospectuses in the corporate department, and we
sat at lunch one day after about six or nine months,
and a partner came over and said that there was
a change to the disclosure lores that the SEC came
out with, and that from now on, there's going to
(00:24):
be a new way that you write paragraph twelve best six.
And I was at a table with like six really
bright people that I really liked that we're doing the
same thing as me, and they lit up, they were excited.
I remember thinking to myself, I could care less. How
am I going to compete with this group. They're bright,
they're hard working, and they love this stuff. I remember
(00:45):
going home that day, I think eight to myself, I
gotta find something else that I love. That's the journey
I think that we're all on. I'm Bob Pittman, and
welcome to this episode of Math and Magic Stories from
the Frontiers and Marketing, where we explore success stories and
(01:07):
some failures and the people behind them, focusing on that
marketing and product success formula of strong analytics and powerful
creative math and magic. We have as our guest today,
someone who has an amazing track record of success, success
that has always been built on well crafted strategy and
execution with both precision and passion. David Zaslow. He's the
(01:40):
President CEO of Discovery with over three billion viewers in
over two hundred and twenty countries, lawyer, strategists, cable pioneer, dealmaker, visionary,
even one of the highest paid execs in the US.
But what most people say about him is that he's
a nice, polite and concerned round a great guy. Actually,
(02:01):
I don't think I've ever heard anyone say a bad
word about him. Trust me, that's hard to pull off.
With a career as long and as diverse as David's,
he is really that great. So here he is today,
David's asked off with his ever present smile. Thank you, Bob.
It's a pleasure for me to be here because you
and I know each other for thirty years, many many years.
(02:22):
You inspired me. You made the cable business cool and
fun and hip, even though the industry as we looked
at it was very uncertain in those first few years.
You inspired many of us, including me that this is
what we wanted to do with our lives. You are
very nice and by the way you inspire me and
inspire others. Today, here's what we're gonna do. We're gonna
get started before we get into the meat of it.
(02:44):
I want to do you in sixty seconds. We have
fun with it. Do you prefer vanilla or chocolate, chocolate,
chip mint? Twitter or Instagram? Instagram, coffee or tea? Coffee?
Shark Weeker, Puppy Bowl, sharkly because it's a week in
Manhattan or Brooklyn. I live in Manhattan, but I'm a
(03:06):
Brooklyn boy. That's where I grew up, so my heart
is still in Brooklyn. Golf for tennis. Pretty bad at golf,
but it's what I play. It's what I enjoy doing now.
Sunrise or sunsets. Sunrise, that's my thing. I get up
at a quarter to five in the morning. I love
to be out while everyone's asleep. Mcnroe, O'Connors McEnroe definitely
MythBusters or Deadliest Catch. I think Deadliest Catch because it
(03:29):
really created a new genre of adventure. What's your favorite
country outside the US? Israel? Boats or planes. I'm a
little claustrophobic. So this answer may surprise you, but plane
with boats, you're stuck on him for an awful long time.
What did you want to be when you were growing up?
I thought I wanted to be a lawyer because my
dad was a lawyer and he loved it. When I
became a lawyer, who was pretty quick once I started
(03:51):
working that I realized it was the wrong choice for me.
It's one of the reasons that I have built a
very big internship program at Discovery, because I think getting
a summer of experience is a great opportunity to see
what you like and see what you don't before you
really invest yourself for a long time. You have a
legendary intern program, so you're doing it well. Okay, let's
(04:12):
jump into it. Fourteen years ago, you made the move,
the big move from NBC to be the CEO of Discovery.
Just recently, Discovery took the top spot in the key
advertising demo women. There's a lot of noise about in
the industry. You unseated NBC from their long leadership position.
I know that was a surprise for many people, but
(04:33):
not you. You started this journey with Discovery at a
time when NBC and the other broadcast networks were still
far ahead. Did you ever dream this was gonna happen
back in two thousand and seven. Is really a big
moment because cable, with a lot of hard work by
building niche's gain reel viewership and advertiser support and respect.
(04:53):
But it was always the big broadcasters that was the
big platform. And so early this summer when we aggregated
together h G, t V, I D, Food, t LC,
and Own, we had the top five channels in America
for women. We were bigger than not only all the broadcasters,
but we were bigger than the broadcasters plus their cable
networks together. It just reinforces that it doesn't matter what
(05:16):
platform you're on. You need great content that and tell
great stories that people want to spend time with. At Discovery,
we have a real advantage now because there's lots of
scripted content out there, in scripted movies, and there are
lots of channels out there that people go to first show.
But most of our channels are about passion groups and
we're trying to superserve people that like a particular thing.
(05:39):
So Food Network, when you get up in the morning,
you might put that on because you love Bobby Flay,
or you love Giata, or you just love food, h G,
t V, Discovery Science Channel, I D because you love crime.
In this world where people could watch anything, it becomes
harder and harder to curate when you have unlimited choice,
(06:00):
and so we have channels that curate for you. When
we started together thirty years ago, there were three or
four broadcasters, and it was a big deal to offer
people five or six or seven cable channels. I remember
fifteen these channels, and then there was going to be
a hundred. But now the problem with unlimited choices, it
(06:20):
creates anxiety and confusion. And so I think curation is
the real challenge for us in media, and it's to
be able to challenge for individuals trying to figure out
what do I want to watch? What do I do
with my time? And we've tried to gravitate towards things
people love, and that's a very different strategy than most
media companies. When we started cable networks, the basic networks
back in the late seventies early eighties, the whole idea
(06:43):
was narrowcast would be these curated channels, and somehow all
the channels over time sort of drifted away from being
that pure This is music, this is kids, this is whatever,
and you've sort of brought it back. Why do you
think the industry drifted away from it? Well, I oh,
why they drifted away because you and I were involved
in a lot of the channels, and it's capitalism profitability.
(07:06):
So you can create a channel and maybe it's a
history channel, maybe it's a kid's channel, and you look
at what your audience is, and for each niche, you
can estimate about how big that audience is going to be.
And when you do a good job within that niche
and you reach a limit and you go for more growth,
often what you need to do is go outside of
who you really are. If you look at the history
(07:26):
of our industry, it's been a very short term gain strategy.
Maybe you could put on a couple of shows that
are outside your niche and grow, but in the long term,
you alienate an audience because when they go to you,
they kind of expect a certain thing out of you.
When they get disappointed, it's very easy to lose a viewer.
And so we think, at least within the traditional TV world,
(07:46):
we really need to stay true to what these brands are,
so we turn away a lot of content that maybe
we could put on food or h G and really
stretch it out. That might get a bigger number, But
ultimately it's about people saying that's what I'd expect to
see on food. That's a lot of fun to watch
on food, but not why is that on the food network?
Do you find that with the advertisers that support these
(08:08):
channels that this is a benefit having this very tight
and clear purpose. Absolutely, the length of view is more.
We sell a lot of products within the home and
food category or cooking category. We have a car channel
called Motor Trend, and in each of those cases, we
have a lot of advertisers that just advertise on us
because they want to reach an affinity group that has
a passion for particular product. As the world changes, it
(08:31):
doesn't really matter if you have free to air channel
or cable channel. It's the content that you have, and
people want to consume that content on any platform. And
so how do we aggregate more and better? I P
We can talk about some of the chances we've taken.
We've been successful in some areas and some it's way
too early to tell, and some have not worked out.
So well, because we're all trying to figure out where
(08:53):
the ball is going to be, you know, the flavor
of the month right now. Are these scripted series and
scripted movie services, and whether it's is any Plus or
HBO or Netflix or Amazon Showtime, they're trying to appeal
to everyone, and I think ultimately people will probably buy
three or four of them. But we see ourselves as
almost like a magazine rack. You may watch scripted series
(09:16):
and scripted movies, but you still love science, you still
love food. You still want to go out and buy
your food magazine. So you waited to get your golf
magazine because you're passionate about golf. You love Oprah Winfrey
and you love her values and what she has to say.
And so that's how we have really changed the way
we look at the business. Let the rest of the
industry really fight over scripted series and scripted movies and
(09:37):
try and be almost like the way cable started, as
you said, very narrow. We don't need a big group
of people. If they're really passionate about food and they're
gonna spend a lot of time with us on any platform,
we could build a good business around that, and we
could nourish the audience. So with the scripted series of movies,
is that going more and more commercial free seems to
(09:58):
meet today that when someone's looking in a a movie, looking
at a series, they expect no commercials in it, whereas
the kind of content you have, commercials go with an
expectation of the content they're getting. People are consuming more
content than they ever have, but they're consuming it on
different platforms and as a result of that, a lot
of the scripted series and movies on TV have declined.
(10:18):
So you see broadcast declining significantly. Some of the more
broad cable networks that were nourished by scripted series or
movies that we're being rerun and rerun are declining quickly.
And so it's one of the reasons why we've emerged
with our group of channels as the number two or
three media company in America and number one for women.
You've been through the business in so many roles. How
(10:40):
do you think about the rebalancing of the power players
and TV. When you went to Discovery, no one thought
this is going to be the major media company in America,
And here you are today. And there's some others that
you looked at and said they'll always be there, and
they're not. When I went to Discovery, we had Discovery Channel,
we had Animal Planet, and we had t ls A
(11:00):
and it was called the Learning Channel, and that was
basically it. And our international business was very small. We
determined that we were going to lean forward and take
a lot of risk. We created the Oprah Winfrey Network.
Big risk, big risk and a lot of challenges, and
Oprah and I fought for three or four years to
find the right voice for that channel and to create
content that would really nourish an audience. And we didn't
(11:22):
launch that channel intending it to be a channel for
African American women, but in the end, there was a
void in the market and Oprah's voice and taste and
her ultimate drive to create quality premiere content for African Americans,
and seeing that that wasn't being done, we were able
to build the number one channel for African American women.
We launched i D Investigation Discovery, which is now the
(11:43):
number one channel in America for women that didn't exist.
True crime podcast do very well too. CBS for many
years was the number one broadcast network. There's something about
crime that's very primitive. We start every show on I
D with there's a murder, then we do a close
up of someone's face and there's a tier and we
all have that innate question of what happened, who did it,
(12:06):
and could have happened us. We also launched a car
channel called Motor Trend. Most media companies were defending their
existing channels. If you were at Viacom, you were defending
MTV and v H one and Nickelodeon. If you were
a Time Warner, you were defending T n T and
TBS and CNN, and they did a great job of it.
We decided that we were really going to try and grow,
(12:28):
and so we launched a lot of new channels. We
acquired scripts so we're able to get h G, t
V and cooking and food and d I Y, And
then we went over to Europe, where most media companies
have been a little wary, but we invested a lot
of money in Europe and Latin America, and I think
probably more than anyone else in the US media business
(12:50):
by a lot. Today, with the largest international media company,
we have twelve channels in every country. We've even gotten
into free to air across Europe, and we have your Sport,
which is the ESPN of Europe. But we have a
lot of losses. Not only did we make a lot
of mistakes, but we had a deficit invest So we
had a great shareholder group, John Malone and Bob Myron
(13:13):
in the new House family. For the first twenty five
years of our company took no money out of discovery.
So most of media traditional media in America, at the
end of every year there was a certain amount of profit,
they took that money out in discovery. At the end
of every year, we said where can we invest this
for growth? And so we're now the most profitable in
the national business. But for many years we were investing
(13:37):
and in a lost position. Did you ever worry that
maybe you've made a mistake and it wasn't at a
term profitable. Absolutely. In many cases we launched channels that
worked in a lot of countries and other countries didn't
work at all. In some cases we built great businesses.
We built a great business in Russia and then the
media rules changed where non Russian companies could not own
(13:59):
of media business, so we had a restructure and fully
divest our way out. Latin America was a fantastic business
for us for ten years, and then the economy is
turned upside down and they were struggling, and then Europe
was good for us, and then Europe started to slow down,
and then we had a great run in Asia. And
so we're in two d and twenty countries. There's a
lot of risk. The positive is we've built a lot
of competence. We have teams on the ground than every country.
(14:22):
We have a sense of how to do business around
the world. And as the world has become more global,
we're in this unique position of having content in language
in every country in the world, and it gives us
more of a perspective on media. It also gives us
more diversity. It's always like a portfolio. In the media industry,
you're known as one of the great strategists. As companies
(14:43):
are built, c e o s have three options you
make buy or partner. Scripts is a great example of
by Oprah is a perfect example of partner and maybe
deadly as catches the great build example. How do you
think about those three options. You've got your strategy in place,
Does the strategy come with one of those or do
(15:04):
you examine all three against every leg of the strategy
you're getting ready to execute. I think Ultimately, you have
to try and figure out where you think people are
going to be consuming content, and try and figure out
how you're gonna get the stuff that people are gonna
want and put it on the platforms where they're gonna
want to see it. A great example of that is
for my first ten years at Discovery, up until four
(15:26):
or five years ago, people weren't consuming content on phone screens.
They were making phone calls, they were texting, but they
weren't consuming content. Really until the last five years, Netflix
was only accelerating and the ability to move content around
from different platforms was just beginning. So for my first
ten years, I was operating in a pretty traditional business.
We were running cable channels, launching channels around the world,
(15:49):
launching free to air channels, and putting content on those
platforms and trying to get as many people to watch
as possible. What made it traditional was the place that
they watched content was on a TV set, and so
we kind of had a old stadium and we had
a pretty good sense of what we were doing and
who our competition was. Because there was really only one
place to consume rich content, and that was the TV,
(16:11):
it started to become pretty clear about four or five
years ago that everyone was going to have a screen
in their hands. People were going to be able to
consume anything they want, as opposed to just what's on
the schedule on a TV set. We started asking the
question what will people watch when they could watch anything,
which is very different than what will people watch when
(16:31):
they could watch anything that's on the TV set on
those fifty channels in France or in Italy. And so
it required looking again at our content and trying to
figure out that we have the right mix of I
P of content. And we came to the conclusion, even
though the company was doing great at the time, that
we need to do a full reset. And I think
(16:52):
we came to this probably earlier than anyone else because
one of the great assets we have at Discovery is
one of our largest shareholders is On Malone and he's
a great strategic thinker. He sees the world almost like
a Bobby Fisher. And it was John over a weekend
that said, we have all this great content for cable
channels and free to air channels, but if people could
(17:13):
watch anything on any platform, how would we do? And
I looked at him and I said, uh, I don't
think we do that well. I think we'd have a
real problem had you thought about the phone as a
viewing platform. I did, but I was thinking about it
not coming for a lot longer, and so we really
we changed the whole strategy of the company. It was
really based more on intuition and instinct. But if we
(17:36):
wanted content that people are gonna watch when they could
watch anything, we said to ourselves, what is that. The
first thing that came to mind was sports. If you
really love tennis, you're gonna want to watch the French
Open or the US Open. If you really love golf,
you're gonna want to be able to watch the PGA Tour.
If you really love cycling, you're gonna want to watch
Toward de France. And so we looked at Eurosport. It
(17:58):
had three sports channels in every kind tree in all
of Europe. If it was available to buy, we would
have bought it. But our only way of getting at
the sports at that point was the partner partner. So
we partnered and it turned out good because we learned
a lot from them. They were quite good and sports
was new to us. But then as soon as we
had the opportunity to buy. We brought them out and
(18:18):
then we went on a buying spree with sports in
Europe and around the world. The people think you were
crazy doing that at the time, they did because the
margins on sports were much lower. Those were big bets,
but we had real conviction that we needed great content
that people were watching no matter what. We also recognized
what we will go down and what we weren't. We're
(18:39):
not a movie company. We've done some scripted content, but
there were a lot of media companies that were a
lot bigger than us, that understood scripted content much better
than we did, and so we weren't gonna win by
trying to become a great scripted series company or become
a movie company. It wasn't what we did. We were
a non fiction company. We understood how to tell stories,
(19:01):
and sports to us was really something that was attainable.
We felt like if we stuck with just Discovery and
Animal Planet and Science and TLC that if media is
a poker hand, we didn't have the right cards and
it's a guess and we made a lot of mistakes
in sports. What was your biggest mistake in sports? When
we bought Eurosport, our ambition was to be the leader
(19:24):
in sports all across Europe. We did it, but we
invested probably more than we should have, and we bought
most of what was available. There were multiple bidders for
football or soccer across Europe country by country. They want
to get the most premier sport, and we participated in
some of those auctions because we felt like in Germany
we need the Bundesliga, which is like the NFL, but
(19:46):
it was so expensive that it overflowed the boat, whereas
it was very efficient because there weren't multiple bidders for
us to own all the majors in tennis or own
all the cycling. Over a couple of years, we learned
that we're better off staying away from football because it's
so so expensive and so risky, and we were able
(20:07):
to pick up most of the other sports for much
more of a reasonable price, and more importantly, we're able
to get it for long term. When you buy football
in Europe, you only get it for three years and
then you got a bid again, whereas we got the
Olympics for a decade, having some time to develop an
audience and to figure out how to present that content,
and then to grow an asset around. It takes time,
(20:30):
and so one of our big strategies around sports was
don't do short term deals anymore. Just hold on a second,
because we've got so much more to talk about. We'll
be back after a quick break. Welcome back the Math
and Magic. We're here with David Zasloff. Let's go back
(20:50):
a little bit. Born in Brooklyn, grew up in Brooklyn,
moved to Rockland County. I was sort of at that
moment where a lot of people were leaving cities going
to the suburbs. Paint a picture of life then. I mean,
what kind of childhood did you have and what was
America like at that moment that you hit Rockland County.
I love Brooklyn. We were on the sixth floor of
an apartment building and we had a two bedroom apartment.
(21:12):
I shared a room with my older brother and my
younger brother was in my parents room. We had a
little den. I thought it was the greatest thing ever.
I moved when I was in second grade. It was
a little scary when I went to Rockland County because
we bought a house, and when we bought a house,
I had in my own room. It was a little
scary at first, I was used to sharing a room
my brother. Everything was bigger, There was lots of grass.
(21:33):
There wasn't a lot of grass in Brooklyn, but I
loved it. Rockland County was a great, very diverse community.
It was a middle class, lower middle class area. We
went there because we can get four bedrooms and two
car garage. My dad was a lawyer, super hard worker.
He was up at five thirty every day. And my
mom was a teacher. You know. Warren Buffett once talked
(21:54):
about my generation being the great beneficiary because when my
mom was growing up, they weren't as many fair choices
for really bright educated women, and the opportunities were limited,
and so my mom went into teaching. So she was
home when I got home. She read to us every night.
And I think there's a whole generation of us that
grew up with really great teachers. My mom was a
(22:16):
teacher too, for those same reasons. I mean a lot
of the wrong reasons. But the beneficiary was I think
the education system. But Rockland was great, and you were
just inducted into the Remapo High School Hall of Fame,
Sports Hall of Fame, Sports Hall of Fame. As a
tennis player, I learned a lot from tennis. When I
was very young, I was very good ALTHEA Gibson saw
(22:36):
me play and wanted to take me on, and so
she was giving me instruction for nothing as a young talent,
and I thought I was talented at the time. When
I was ten and twelve, I was really very good.
When I was in junior high school, they restructured my
day in junior high school so I didn't have to
go to the last two periods so I can go
up to play on the varsity high school team. It
(22:58):
became part of who I thought I was. I just
thought I was always going to be really good just
because I was talented. I was winning a lot as
a young kid. And when I got to the four
teens and sixteens, some of the the players that I used
to beat started beating me. A couple of the players
in the New York area that I would play with,
i'd meet him, we'd play for two hours, and then
they'd stay for another two or three hours and hit backheads.
(23:21):
But when I got there, there had been there for
two hours working on four hands or serving. I came
to learn that talent is only a very small portion
of what creates success. I got to see a lot
of guys blow right by me, and it was painful.
By the end, I was nowhere close to as good
as I could have been. And so my big lesson
(23:42):
from tennis was I'm not going to get out worked again.
If your eighteen year old self saw you today, what
would you think? How did that happen? So you didn't
have dreams of this as a kid? No. I was
a lawyer at a firm called La Buff Lamb that
was doing La Buff big white shoo firm. And at
that job, and I got an apartment and had a
(24:03):
big rent and I needed to make it work. And
I stayed there for four years. But I knew pretty
early on I'm not that great at this and I
don't like it that much. I worked really hard, so
I think they thought I was pretty good at it,
but it didn't feel right to me. I got lucky
because a partner transferred in who worked at MTV, who
is now Federal court judge Richard Barman, and he had
(24:25):
a lot of cable clients. He also was a tennis player,
and I was quietly unhappy. And I found out rich
was a tennis player, and we went and played tennis
a couple of times, and then we had a weekly game.
Next thing you know, I was doing all this cable work.
You were doing work for MTV, for MTVS, for Discovery,
for CNN, for most of the media companies. But the
(24:47):
real opportunity that I got was Jack Welch. He and
Bob Wright, who was the chairman of NBC at the time,
said they want to get into the cable business, which
at the time was unusual because broadcasters were not in
the cable business. So I sent the letter to them
saying I love the cable business. I have a great
passion for it. I've done a lot of work. If
you're gonna build a cable division, I'd love to be
(25:07):
part of it. And they called me over. Remember Bob
Wright wrote on the top of it, bring this kid in.
I was the third or fourth person hired for NBC
Cable for NBC Cable. Through that, I built a relationship
with Jack Welch, who still loves you today, and that
love created all this confidence in me. It created a
(25:28):
willingness to fail, it drive to work hard. But mostly
I got to be in all these meetings that he
was in, and I got to see firsthand, whether it
was around cable or around broadcast, you begin to know
the questions that he's going to ask how he sees
the world. When I see you as a business person,
am I seeing some Jack Welch too? There's no question
(25:51):
you're deeply influenced by the people that you work with.
I got to work with Jack Walch, and I also
got to work with Bob Right, who ran NBC, and
they were very different. But by spending eighteen years at
that company and going to meetings and quarterly reviews and
business reviews, you think that you have the right question.
But it's the question that Jack would ask. Steve Ross
(26:14):
was that for me? Founder of Warner Communications. So I
had Jack and the second half of my career I
had John Malone. These are two of the greatest leaders entrepreneurs.
And that's lucky. That eighteen year old kid could never
imagine that he would have had the chance to learn
from and hang around with Jack Welch. That eighteen year
(26:35):
old kid would never believe that he would have a
chance to spend Saturday mornings talking to John while he
walks the dog and hear how he sees the world
and tell him what I'm thinking about and talk about
where the world is going and how to succeed. So
you made a jump from partner to law firm to
NBC Jeff to take a pay cut to pay cut.
(26:56):
Everyone thought I was crazy, including the people at the
law firm. What's the less than that for somebody who's
building their career here you are, had a nice career
as a lawyer, working with interesting people, and you took
a fifty percent pay cut to make a job somewhere.
You got to try and figure out what you really
love doing, what you're interested in as a lawyer. I
knew it wasn't gonna work when I was writing prospectuses
(27:16):
in the corporate department. And we sat at lunch one
day after about six or nine months, and a partner
came over and said that there was a change to
the disclosure laws that the SEC came out with, and
that from now on, there's going to be a new
way that you write paragraph twelve best six. And I
was at a table with like six really bright people
that I really liked that we're doing the same thing
(27:37):
as me, and they lit up, they were excited. I
remember thinking to myself, I could call us, and I
thought how am I going to compete with this group?
They're bright, they're hard working, and they love this stuff.
I remember going home that day, I think eight to myself,
I gotta find something else that I love. That's the
journey I think that we're all on. And that's what
(27:57):
I tell our interns that you may be in PR,
you may be in marketing, you may be in programming,
but if you're working at one of our channels, you
get to see all of it. Try and imagine would
you want to be that person? And a successful internship
might be that you didn't love PR, but you got
to look at marketing and you thought, maybe that's for me.
And I think if by age thirty you could figure
out you can move your way around so you can
(28:19):
get yourself into something that you're excited about, that you
really love, then it's a gift. You started out I
think as general counsel of NBC Cable work through business affairs,
business development, became president of NBC Cable, president of NBC
Universal Cable. You didn't want to be a lawyer. What
did you discover that that was sort of your superpower,
your skill that really made you you. I love the business,
(28:42):
so I was happy. I was happy to be there
and grateful to be there, and figuring out how to
get along with people because NBC was a pretty complicated place.
We had to work across a lot of divisions. If
we wanted to do anything, we had to also go
up to G and presented a G board. So there
were a lot of layers and a lot of different people,
and it was figuring out how to get along and
(29:05):
how to find support. You know, I think about you
and there are two things to come to mind. One
strategist and two you have this incredible people skills, but
you get people to talk listen. Well, was that developed
or was that a basic skill you had that sort
of came to life in the right circumstance. I do
love people. We're all imperfect. Everyone has a few things
(29:27):
that you admire look for the best in people. There's
a Brooklyn element of be a candid but also I'm
pretty emotional at times. And one of the things that
Jack worked with me on was that it's not show friends,
it's show business. Part of your job is to get
along with everyone. If you're having a real conflict and
it's creating an issue, there is no right and wrong
(29:48):
so you just got to try and figure a way
around it. And often there are personalities. There are some
people that just one conflict and there are ways you
can just step away from it, let him go argue
with someone else, and you got to stay away from
that negative energy. Positive energy is the most important thing
you need in a company to succeed personally. Positive energy
is the thing that a company itself needs to succeed.
(30:10):
Every idea you have the will to happen, and part
of that will is positive energy. We'll figure it out,
We'll keep trying, and when we find something they like,
we'll give them more of it. That's sort of what
the media business is about, trying to figure out with
every one of our channels, what are they like? And
then we get a rating, We find out how many
people watch, how long did they watch for It's not
(30:31):
what we think is going to be people should see
on Food Network or on the Oprah Winfrey Network or
on Discovery. We're really trying to nourish an audience. The
better job we do, the more they watch, and the
more shows they watch. When you were at NBC, how
hard was it to get support for your plans? I
mean you grew the business. As you say, you were
(30:52):
one of the first people hired an NBC cable became
NBC Universal, and you built out this incredible array of
networks where people leaning into cables. The thing we gotta
go or as you said earlier with everybody saying you're
stealing my money from broadcast, was it really tough slog
to grow? Well, first, it's never one person. I was
the guy that in the beginning that carried the bags,
(31:13):
and there were a lot of brilliant people that were
there with me in those early days that were very courageous.
Bob Right was one, a guy named Tom Rodgers was
fighting every day to build that business. Anytime you see
a business, it's multiple people. It was a big group
of us. We did face some real challenges. I remember
there was a great programmer at NBC at the time
named Don Olmaier, really like a legend genius by the way,
(31:37):
started the v M as with us at MTV. Really
he was at Nibisco and he said, I got an
idea for awards show. If you do it with me,
I'll sponsored. And he created the Skins game and golf.
He just had that brilliant touch and I remember being
in a meeting once and it was Jack Welch, it
was Bob Wright who was running NBC at the time.
There was Don Olmyre running entertainment. Dick Ever saw another
great legend, great friend of mine was running sports. Andy
(32:00):
Lack was running News. I was thirty five at the time,
and I remember thinking to myself, how did this happen?
How how am I in this room? But we were
in one meeting and CNBC was losing significant money. We
were invested with Chuck Dolan in a MC, in Bravo
and News twelve Long Island. We had invested in sports
channels with Cable Vision, and everything was losing money, real
(32:24):
money at the time, and Don Olmier stood up and said,
losing all this money in cable. For the amount of
money while losing in cable, I could do five more
pilots for NBC. This is nuts. Give me the money.
Let me do five more pilots. It was Welch's drive
to say, I don't care how much money we're losing.
(32:45):
The audience. Eventually, I think is going to go to
cable and we have to invest. Don's passion was real
because there wasn't a limited amount of resources he ended
up being hugely successful with the resources he had. Yes,
but when NBC sold that bit and this the comcast
of the profits of that business was from the cable business.
(33:07):
That vision of investing in the next medium and that
drive to do it even with the losses really paid off.
And it's one of the things that when I got
to Discovery fourteen years ago, it gave me real conviction
for launching new channels and getting out and building businesses
outside the US. When they started to lose, I had
that feeling of like, I've been here before, we have
(33:30):
to figure out how to grow You make the jump
from NBC to Discovery why. A big piece was that
Discovery was a great company. It had great ownership, the
new House family and John Malone. I was very close
to both of them, and they really wanted me to come.
So it was like I was going to a family
and a family that I loved and that I admired,
(33:52):
and it was a chance to run my own company
with some real autonomy. When I went to Discovery, the
real drive was how do we grow this? How do
we grow it in the US, how do we grow
it around the world? What else should we be buying
and Discovery itself was a brand that really had the
ability not just to entertain, but when Discovery was at
(34:14):
its best, had a chance to really inspire. After I
got to Discovery, we did Planet Earth. That's a great
example of a piece of content that really did more
than just entertain. It helped people fall in love again
with the planet. And it's hard to really care about
something if you haven't fallen in love with it. Planet
(34:34):
Earth really had an impact, by the way, still does.
I remember thinking to myself, that's why I'm here. This
isn't just about making money, This isn't just about growing audience.
This is about having an impact. I followed what you
did with great admiration at MTV when you took MTV
around the world and had a huge impact with culture
(34:56):
and fashion, and we took Discovery and sign and surround
the world, and in certain cases we made the demonstrable
decision that will probably never make money in this country,
but the idea that we could take science and Discovery
into countries around the world and the kids could put
the TV set on and they could watch this content,
(35:17):
they could have some impact. And so there really was
that real drive within the ownership to do well. But
it was also to really do some good and that's
part of the culture that still exists that. I think
it's one of the reasons we attract so much great
talent at Discovery. How would you describe the culture at Discovery?
(35:38):
Your corporate culture? Make sure you respect other people. People
should be able to come to a creative company and
feel safe and feel valued. We're great record on equal pay.
We really have a chance creatively to make a difference.
That's where we try and this thing wish ourselves. When
you came to Discovery, you really made a mark quickly.
Probably one of the most interesting things is what you
(35:59):
do with the gramming. We talked about Deadliest Catch earlier.
What was the thinking there? Where did that idea come
from that this is the direction we're going. It was
more of a basic point, which is the future of
this business is about owning great content globally and creating
great content and telling great stories and also having characters
that people love, whether it's Micro and Dirty Jobs, whether
(36:20):
it's Sig and Phil and Deadliest Catch. Jamie and Adam
are MythBusters. That was kind of the formula, great content,
great characters. Ultimately we were going to try and save
as much money as possible by running as an efficient business.
We broke the company in half. Everything that's not on
the screen, let's get really aggressive about every penny so
(36:41):
that we could spend more money on the screen. When
I got there, I think we were spending about hundred
million dollars on content. Today we're spending four and a
half billion dollars. And so the whole journey of Discovery
has been spend more and more money on content and
own that content everywhere in the world. We we're talking
earlier about the phone and where are people going to
(37:02):
consume your product? You were very early and jumping to
digital discovery. Go. You've done the Group nine deal, You've
got lots of plays there. How do you think about
the merger of digital and TV networks and their content
and brands. We're hedging in a lot of different areas.
The number one thing that we're doing is we're owning
all of our content. We did buy a significant interest
(37:24):
in a business called Group nine, which owns now this.
It's the leading provider of news for people and under.
Most of what we did a couple of years ago
was long form content, and now we're one of the
leaders in short form content and mid form content. Now
short form and mid form and not making money today.
But we've built a great group of storytellers that are
(37:46):
generating six seven eight billion views a month of short
form content, and we've built that expertise into our company,
which over the long term, we think it's going to
really be an advantage. Do you think this is like
in the days at NBC Cable and Don Olmeiner says
they're losing all that money. Give it to me that
you're investing for the future and this will have the
same kind of outcome as Cable did against Broadcast. I
(38:08):
don't know. This is a moment where if you have chips,
you got to decide, I'm not in this for the
long term and I'm not going to invest in a
lot of new stuff. I'm gonna generate as much near
term value as possible and sell the company. Time Warner
had that strategy. Jeff Bukas is a great leader, and
he was going to build that company to get the
most value for shareholders. There are a lot of companies
(38:30):
and media that are being run that way. When Bob
Iger said I'm gonna try and build Disney Plus an
ESPN plus two D and fifty million homes watch me
over the next five years. He took the opposite strategy,
which is, I'm all in in the future and I'm
gonna take my I P and I think I can
create some new platforms. I can create a competitor in Netflix.
I can create a sports Netflix type product. Five years
(38:52):
from now, I'm gonna have a more successful company, but
I'm gonna lose a lot of money in the meantime.
We're focused really in the same vein as Bob. We're
betting for the long term. So we are where I
think g E was when they invested in NBC, but
we're just much more diversified. We're not sure which one
of these assets we're going to end up being the
big Is it going to be Group nine, Is it
(39:14):
going to be the fact that we have the greatest
natural history and science global library in the world. Is
it going to be all the sports that we own.
Certainly all of them will not be successful, but we're
going to use all of our energy and will to
have them be successful over the next couple of years.
And it's going to take all that positive energy and
will to make it happen. So we wrap up each
(39:34):
episode as a shout out to the folks who make
math and magic work, the folks who provide the analytics,
which I know you use a lot of, and the
creatives who provide the magic. Who do you think is
the greatest analytics person? If we want to give a
shout out to the mathematician, who isn't John Malone? If
we want to say who's the greatest creative? Just that
spark of a raw idea that turns out to be
(39:57):
that idea that changes the world. Tom for He's a
great guy. Former guest here, you can go back and
listen to his podcast and you're exactly right. David. You
have had an amazing life, an inspiring career, and you're
a great pal. Congrats and thanks for being here. Thank
you so much for having me. Here's what I learned
(40:18):
from David One. Don't get out worked. It's something David
has been thinking about since his tennis years. He waits
up early and outworks the competition because he believes, even
if you have natural talent, hard work always wins today.
To take risk in the future now, even if you're
successful like Discovery was in the TV era, David believes
(40:39):
you have to invest in the next medium so that
you're well positioned when the industry inevitably changes. Three David
believes your company doesn't need the cater to everyone. If
you go after passionate consumers and stay true to your brand,
they'll keep coming back with the content they love. And Fourth,
when it comes to your career, David believes you should
listen to your heart and stay vigilant. David knew a
(41:02):
law career wasn't right for him. You should still work hard,
but be ready for an opportunity to make a move.
Thanks for listening. I'm Bob Pittman. That's it for today's episode.
Thanks so much for listening to Math and Magic, a
production of I Heart Radio. This show is hosted by
Bob Pittman. Special thanks to Sue Schillinger for booking and
(41:22):
wrangling our wonderful talent, which is no small feat Nikkiatore
for pulling research bill plaques, and Michael Asar for their
recording help, our editor Ryan Murdoch, and of course Gayle Raoul,
Eric Angel, Noel Mango and everyone who helped bring this
show to your ears. Until next time,
You're listening to Math and Magic production of I Heart Radio.
As a lawyer, I knew it wasn't gonna work when
I was writing prospectuses in the corporate department, and we
sat at lunch one day after about six or nine months,
and a partner came over and said that there was
a change to the disclosure lores that the SEC came
out with, and that from now on, there's going to
(00:24):
be a new way that you write paragraph twelve best six.
And I was at a table with like six really
bright people that I really liked that we're doing the
same thing as me, and they lit up, they were excited.
I remember thinking to myself, I could care less. How
am I going to compete with this group. They're bright,
they're hard working, and they love this stuff. I remember
(00:45):
going home that day, I think eight to myself, I
gotta find something else that I love. That's the journey
I think that we're all on. I'm Bob Pittman, and
welcome to this episode of Math and Magic Stories from
the Frontiers and Marketing, where we explore success stories and
(01:07):
some failures and the people behind them, focusing on that
marketing and product success formula of strong analytics and powerful
creative math and magic. We have as our guest today,
someone who has an amazing track record of success, success
that has always been built on well crafted strategy and
execution with both precision and passion. David Zaslow. He's the
(01:40):
President CEO of Discovery with over three billion viewers in
over two hundred and twenty countries, lawyer, strategists, cable pioneer, dealmaker, visionary,
even one of the highest paid execs in the US.
But what most people say about him is that he's
a nice, polite and concerned round a great guy. Actually,
(02:01):
I don't think I've ever heard anyone say a bad
word about him. Trust me, that's hard to pull off.
With a career as long and as diverse as David's,
he is really that great. So here he is today,
David's asked off with his ever present smile. Thank you, Bob.
It's a pleasure for me to be here because you
and I know each other for thirty years, many many years.
(02:22):
You inspired me. You made the cable business cool and
fun and hip, even though the industry as we looked
at it was very uncertain in those first few years.
You inspired many of us, including me that this is
what we wanted to do with our lives. You are
very nice and by the way you inspire me and
inspire others. Today, here's what we're gonna do. We're gonna
get started before we get into the meat of it.
(02:44):
I want to do you in sixty seconds. We have
fun with it. Do you prefer vanilla or chocolate, chocolate,
chip mint? Twitter or Instagram? Instagram, coffee or tea? Coffee?
Shark Weeker, Puppy Bowl, sharkly because it's a week in
Manhattan or Brooklyn. I live in Manhattan, but I'm a
(03:06):
Brooklyn boy. That's where I grew up, so my heart
is still in Brooklyn. Golf for tennis. Pretty bad at golf,
but it's what I play. It's what I enjoy doing now.
Sunrise or sunsets. Sunrise, that's my thing. I get up
at a quarter to five in the morning. I love
to be out while everyone's asleep. Mcnroe, O'Connors McEnroe definitely
MythBusters or Deadliest Catch. I think Deadliest Catch because it
(03:29):
really created a new genre of adventure. What's your favorite
country outside the US? Israel? Boats or planes. I'm a
little claustrophobic. So this answer may surprise you, but plane
with boats, you're stuck on him for an awful long time.
What did you want to be when you were growing up?
I thought I wanted to be a lawyer because my
dad was a lawyer and he loved it. When I
became a lawyer, who was pretty quick once I started
(03:51):
working that I realized it was the wrong choice for me.
It's one of the reasons that I have built a
very big internship program at Discovery, because I think getting
a summer of experience is a great opportunity to see
what you like and see what you don't before you
really invest yourself for a long time. You have a
legendary intern program, so you're doing it well. Okay, let's
(04:12):
jump into it. Fourteen years ago, you made the move,
the big move from NBC to be the CEO of Discovery.
Just recently, Discovery took the top spot in the key
advertising demo women. There's a lot of noise about in
the industry. You unseated NBC from their long leadership position.
I know that was a surprise for many people, but
(04:33):
not you. You started this journey with Discovery at a
time when NBC and the other broadcast networks were still
far ahead. Did you ever dream this was gonna happen
back in two thousand and seven. Is really a big
moment because cable, with a lot of hard work by
building niche's gain reel viewership and advertiser support and respect.
(04:53):
But it was always the big broadcasters that was the
big platform. And so early this summer when we aggregated
together h G, t V, I D, Food, t LC,
and Own, we had the top five channels in America
for women. We were bigger than not only all the broadcasters,
but we were bigger than the broadcasters plus their cable
networks together. It just reinforces that it doesn't matter what
(05:16):
platform you're on. You need great content that and tell
great stories that people want to spend time with. At Discovery,
we have a real advantage now because there's lots of
scripted content out there, in scripted movies, and there are
lots of channels out there that people go to first show.
But most of our channels are about passion groups and
we're trying to superserve people that like a particular thing.
(05:39):
So Food Network, when you get up in the morning,
you might put that on because you love Bobby Flay,
or you love Giata, or you just love food, h G,
t V, Discovery Science Channel, I D because you love crime.
In this world where people could watch anything, it becomes
harder and harder to curate when you have unlimited choice,
(06:00):
and so we have channels that curate for you. When
we started together thirty years ago, there were three or
four broadcasters, and it was a big deal to offer
people five or six or seven cable channels. I remember
fifteen these channels, and then there was going to be
a hundred. But now the problem with unlimited choices, it
(06:20):
creates anxiety and confusion. And so I think curation is
the real challenge for us in media, and it's to
be able to challenge for individuals trying to figure out
what do I want to watch? What do I do
with my time? And we've tried to gravitate towards things
people love, and that's a very different strategy than most
media companies. When we started cable networks, the basic networks
back in the late seventies early eighties, the whole idea
(06:43):
was narrowcast would be these curated channels, and somehow all
the channels over time sort of drifted away from being
that pure This is music, this is kids, this is whatever,
and you've sort of brought it back. Why do you
think the industry drifted away from it? Well, I oh,
why they drifted away because you and I were involved
in a lot of the channels, and it's capitalism profitability.
(07:06):
So you can create a channel and maybe it's a
history channel, maybe it's a kid's channel, and you look
at what your audience is, and for each niche, you
can estimate about how big that audience is going to be.
And when you do a good job within that niche
and you reach a limit and you go for more growth,
often what you need to do is go outside of
who you really are. If you look at the history
(07:26):
of our industry, it's been a very short term gain strategy.
Maybe you could put on a couple of shows that
are outside your niche and grow, but in the long term,
you alienate an audience because when they go to you,
they kind of expect a certain thing out of you.
When they get disappointed, it's very easy to lose a viewer.
And so we think, at least within the traditional TV world,
(07:46):
we really need to stay true to what these brands are,
so we turn away a lot of content that maybe
we could put on food or h G and really
stretch it out. That might get a bigger number, But
ultimately it's about people saying that's what I'd expect to
see on food. That's a lot of fun to watch
on food, but not why is that on the food network?
Do you find that with the advertisers that support these
(08:08):
channels that this is a benefit having this very tight
and clear purpose. Absolutely, the length of view is more.
We sell a lot of products within the home and
food category or cooking category. We have a car channel
called Motor Trend, and in each of those cases, we
have a lot of advertisers that just advertise on us
because they want to reach an affinity group that has
a passion for particular product. As the world changes, it
(08:31):
doesn't really matter if you have free to air channel
or cable channel. It's the content that you have, and
people want to consume that content on any platform. And
so how do we aggregate more and better? I P
We can talk about some of the chances we've taken.
We've been successful in some areas and some it's way
too early to tell, and some have not worked out.
So well, because we're all trying to figure out where
(08:53):
the ball is going to be, you know, the flavor
of the month right now. Are these scripted series and
scripted movie services, and whether it's is any Plus or
HBO or Netflix or Amazon Showtime, they're trying to appeal
to everyone, and I think ultimately people will probably buy
three or four of them. But we see ourselves as
almost like a magazine rack. You may watch scripted series
(09:16):
and scripted movies, but you still love science, you still
love food. You still want to go out and buy
your food magazine. So you waited to get your golf
magazine because you're passionate about golf. You love Oprah Winfrey
and you love her values and what she has to say.
And so that's how we have really changed the way
we look at the business. Let the rest of the
industry really fight over scripted series and scripted movies and
(09:37):
try and be almost like the way cable started, as
you said, very narrow. We don't need a big group
of people. If they're really passionate about food and they're
gonna spend a lot of time with us on any platform,
we could build a good business around that, and we
could nourish the audience. So with the scripted series of movies,
is that going more and more commercial free seems to
(09:58):
meet today that when someone's looking in a a movie, looking
at a series, they expect no commercials in it, whereas
the kind of content you have, commercials go with an
expectation of the content they're getting. People are consuming more
content than they ever have, but they're consuming it on
different platforms and as a result of that, a lot
of the scripted series and movies on TV have declined.
(10:18):
So you see broadcast declining significantly. Some of the more
broad cable networks that were nourished by scripted series or
movies that we're being rerun and rerun are declining quickly.
And so it's one of the reasons why we've emerged
with our group of channels as the number two or
three media company in America and number one for women.
You've been through the business in so many roles. How
(10:40):
do you think about the rebalancing of the power players
and TV. When you went to Discovery, no one thought
this is going to be the major media company in America,
And here you are today. And there's some others that
you looked at and said they'll always be there, and
they're not. When I went to Discovery, we had Discovery Channel,
we had Animal Planet, and we had t ls A
(11:00):
and it was called the Learning Channel, and that was
basically it. And our international business was very small. We
determined that we were going to lean forward and take
a lot of risk. We created the Oprah Winfrey Network.
Big risk, big risk and a lot of challenges, and
Oprah and I fought for three or four years to
find the right voice for that channel and to create
content that would really nourish an audience. And we didn't
(11:22):
launch that channel intending it to be a channel for
African American women, but in the end, there was a
void in the market and Oprah's voice and taste and
her ultimate drive to create quality premiere content for African Americans,
and seeing that that wasn't being done, we were able
to build the number one channel for African American women.
We launched i D Investigation Discovery, which is now the
(11:43):
number one channel in America for women that didn't exist.
True crime podcast do very well too. CBS for many
years was the number one broadcast network. There's something about
crime that's very primitive. We start every show on I
D with there's a murder, then we do a close
up of someone's face and there's a tier and we
all have that innate question of what happened, who did it,
(12:06):
and could have happened us. We also launched a car
channel called Motor Trend. Most media companies were defending their
existing channels. If you were at Viacom, you were defending
MTV and v H one and Nickelodeon. If you were
a Time Warner, you were defending T n T and
TBS and CNN, and they did a great job of it.
We decided that we were really going to try and grow,
(12:28):
and so we launched a lot of new channels. We
acquired scripts so we're able to get h G, t
V and cooking and food and d I Y, And
then we went over to Europe, where most media companies
have been a little wary, but we invested a lot
of money in Europe and Latin America, and I think
probably more than anyone else in the US media business
(12:50):
by a lot. Today, with the largest international media company,
we have twelve channels in every country. We've even gotten
into free to air across Europe, and we have your Sport,
which is the ESPN of Europe. But we have a
lot of losses. Not only did we make a lot
of mistakes, but we had a deficit invest So we
had a great shareholder group, John Malone and Bob Myron
(13:13):
in the new House family. For the first twenty five
years of our company took no money out of discovery.
So most of media traditional media in America, at the
end of every year there was a certain amount of profit,
they took that money out in discovery. At the end
of every year, we said where can we invest this
for growth? And so we're now the most profitable in
the national business. But for many years we were investing
(13:37):
and in a lost position. Did you ever worry that
maybe you've made a mistake and it wasn't at a
term profitable. Absolutely. In many cases we launched channels that
worked in a lot of countries and other countries didn't
work at all. In some cases we built great businesses.
We built a great business in Russia and then the
media rules changed where non Russian companies could not own
(13:59):
of media business, so we had a restructure and fully
divest our way out. Latin America was a fantastic business
for us for ten years, and then the economy is
turned upside down and they were struggling, and then Europe
was good for us, and then Europe started to slow down,
and then we had a great run in Asia. And
so we're in two d and twenty countries. There's a
lot of risk. The positive is we've built a lot
of competence. We have teams on the ground than every country.
(14:22):
We have a sense of how to do business around
the world. And as the world has become more global,
we're in this unique position of having content in language
in every country in the world, and it gives us
more of a perspective on media. It also gives us
more diversity. It's always like a portfolio. In the media industry,
you're known as one of the great strategists. As companies
(14:43):
are built, c e o s have three options you
make buy or partner. Scripts is a great example of
by Oprah is a perfect example of partner and maybe
deadly as catches the great build example. How do you
think about those three options. You've got your strategy in place,
Does the strategy come with one of those or do
(15:04):
you examine all three against every leg of the strategy
you're getting ready to execute. I think Ultimately, you have
to try and figure out where you think people are
going to be consuming content, and try and figure out
how you're gonna get the stuff that people are gonna
want and put it on the platforms where they're gonna
want to see it. A great example of that is
for my first ten years at Discovery, up until four
(15:26):
or five years ago, people weren't consuming content on phone screens.
They were making phone calls, they were texting, but they
weren't consuming content. Really until the last five years, Netflix
was only accelerating and the ability to move content around
from different platforms was just beginning. So for my first
ten years, I was operating in a pretty traditional business.
We were running cable channels, launching channels around the world,
(15:49):
launching free to air channels, and putting content on those
platforms and trying to get as many people to watch
as possible. What made it traditional was the place that
they watched content was on a TV set, and so
we kind of had a old stadium and we had
a pretty good sense of what we were doing and
who our competition was. Because there was really only one
place to consume rich content, and that was the TV,
(16:11):
it started to become pretty clear about four or five
years ago that everyone was going to have a screen
in their hands. People were going to be able to
consume anything they want, as opposed to just what's on
the schedule on a TV set. We started asking the
question what will people watch when they could watch anything,
which is very different than what will people watch when
(16:31):
they could watch anything that's on the TV set on
those fifty channels in France or in Italy. And so
it required looking again at our content and trying to
figure out that we have the right mix of I
P of content. And we came to the conclusion, even
though the company was doing great at the time, that
we need to do a full reset. And I think
(16:52):
we came to this probably earlier than anyone else because
one of the great assets we have at Discovery is
one of our largest shareholders is On Malone and he's
a great strategic thinker. He sees the world almost like
a Bobby Fisher. And it was John over a weekend
that said, we have all this great content for cable
channels and free to air channels, but if people could
(17:13):
watch anything on any platform, how would we do? And
I looked at him and I said, uh, I don't
think we do that well. I think we'd have a
real problem had you thought about the phone as a
viewing platform. I did, but I was thinking about it
not coming for a lot longer, and so we really
we changed the whole strategy of the company. It was
really based more on intuition and instinct. But if we
(17:36):
wanted content that people are gonna watch when they could
watch anything, we said to ourselves, what is that. The
first thing that came to mind was sports. If you
really love tennis, you're gonna want to watch the French
Open or the US Open. If you really love golf,
you're gonna want to be able to watch the PGA Tour.
If you really love cycling, you're gonna want to watch
Toward de France. And so we looked at Eurosport. It
(17:58):
had three sports channels in every kind tree in all
of Europe. If it was available to buy, we would
have bought it. But our only way of getting at
the sports at that point was the partner partner. So
we partnered and it turned out good because we learned
a lot from them. They were quite good and sports
was new to us. But then as soon as we
had the opportunity to buy. We brought them out and
(18:18):
then we went on a buying spree with sports in
Europe and around the world. The people think you were
crazy doing that at the time, they did because the
margins on sports were much lower. Those were big bets,
but we had real conviction that we needed great content
that people were watching no matter what. We also recognized
what we will go down and what we weren't. We're
(18:39):
not a movie company. We've done some scripted content, but
there were a lot of media companies that were a
lot bigger than us, that understood scripted content much better
than we did, and so we weren't gonna win by
trying to become a great scripted series company or become
a movie company. It wasn't what we did. We were
a non fiction company. We understood how to tell stories,
(19:01):
and sports to us was really something that was attainable.
We felt like if we stuck with just Discovery and
Animal Planet and Science and TLC that if media is
a poker hand, we didn't have the right cards and
it's a guess and we made a lot of mistakes
in sports. What was your biggest mistake in sports? When
we bought Eurosport, our ambition was to be the leader
(19:24):
in sports all across Europe. We did it, but we
invested probably more than we should have, and we bought
most of what was available. There were multiple bidders for
football or soccer across Europe country by country. They want
to get the most premier sport, and we participated in
some of those auctions because we felt like in Germany
we need the Bundesliga, which is like the NFL, but
(19:46):
it was so expensive that it overflowed the boat, whereas
it was very efficient because there weren't multiple bidders for
us to own all the majors in tennis or own
all the cycling. Over a couple of years, we learned
that we're better off staying away from football because it's
so so expensive and so risky, and we were able
(20:07):
to pick up most of the other sports for much
more of a reasonable price, and more importantly, we're able
to get it for long term. When you buy football
in Europe, you only get it for three years and
then you got a bid again, whereas we got the
Olympics for a decade, having some time to develop an
audience and to figure out how to present that content,
and then to grow an asset around. It takes time,
(20:30):
and so one of our big strategies around sports was
don't do short term deals anymore. Just hold on a second,
because we've got so much more to talk about. We'll
be back after a quick break. Welcome back the Math
and Magic. We're here with David Zasloff. Let's go back
(20:50):
a little bit. Born in Brooklyn, grew up in Brooklyn,
moved to Rockland County. I was sort of at that
moment where a lot of people were leaving cities going
to the suburbs. Paint a picture of life then. I mean,
what kind of childhood did you have and what was
America like at that moment that you hit Rockland County.
I love Brooklyn. We were on the sixth floor of
an apartment building and we had a two bedroom apartment.
(21:12):
I shared a room with my older brother and my
younger brother was in my parents room. We had a
little den. I thought it was the greatest thing ever.
I moved when I was in second grade. It was
a little scary when I went to Rockland County because
we bought a house, and when we bought a house,
I had in my own room. It was a little
scary at first, I was used to sharing a room
my brother. Everything was bigger, There was lots of grass.
(21:33):
There wasn't a lot of grass in Brooklyn, but I
loved it. Rockland County was a great, very diverse community.
It was a middle class, lower middle class area. We
went there because we can get four bedrooms and two
car garage. My dad was a lawyer, super hard worker.
He was up at five thirty every day. And my
mom was a teacher. You know. Warren Buffett once talked
(21:54):
about my generation being the great beneficiary because when my
mom was growing up, they weren't as many fair choices
for really bright educated women, and the opportunities were limited,
and so my mom went into teaching. So she was
home when I got home. She read to us every night.
And I think there's a whole generation of us that
grew up with really great teachers. My mom was a
(22:16):
teacher too, for those same reasons. I mean a lot
of the wrong reasons. But the beneficiary was I think
the education system. But Rockland was great, and you were
just inducted into the Remapo High School Hall of Fame,
Sports Hall of Fame, Sports Hall of Fame. As a
tennis player, I learned a lot from tennis. When I
was very young, I was very good ALTHEA Gibson saw
(22:36):
me play and wanted to take me on, and so
she was giving me instruction for nothing as a young talent,
and I thought I was talented at the time. When
I was ten and twelve, I was really very good.
When I was in junior high school, they restructured my
day in junior high school so I didn't have to
go to the last two periods so I can go
up to play on the varsity high school team. It
(22:58):
became part of who I thought I was. I just
thought I was always going to be really good just
because I was talented. I was winning a lot as
a young kid. And when I got to the four
teens and sixteens, some of the the players that I used
to beat started beating me. A couple of the players
in the New York area that I would play with,
i'd meet him, we'd play for two hours, and then
they'd stay for another two or three hours and hit backheads.
(23:21):
But when I got there, there had been there for
two hours working on four hands or serving. I came
to learn that talent is only a very small portion
of what creates success. I got to see a lot
of guys blow right by me, and it was painful.
By the end, I was nowhere close to as good
as I could have been. And so my big lesson
(23:42):
from tennis was I'm not going to get out worked again.
If your eighteen year old self saw you today, what
would you think? How did that happen? So you didn't
have dreams of this as a kid? No. I was
a lawyer at a firm called La Buff Lamb that
was doing La Buff big white shoo firm. And at
that job, and I got an apartment and had a
(24:03):
big rent and I needed to make it work. And
I stayed there for four years. But I knew pretty
early on I'm not that great at this and I
don't like it that much. I worked really hard, so
I think they thought I was pretty good at it,
but it didn't feel right to me. I got lucky
because a partner transferred in who worked at MTV, who
is now Federal court judge Richard Barman, and he had
(24:25):
a lot of cable clients. He also was a tennis player,
and I was quietly unhappy. And I found out rich
was a tennis player, and we went and played tennis
a couple of times, and then we had a weekly game.
Next thing you know, I was doing all this cable work.
You were doing work for MTV, for MTVS, for Discovery,
for CNN, for most of the media companies. But the
(24:47):
real opportunity that I got was Jack Welch. He and
Bob Wright, who was the chairman of NBC at the time,
said they want to get into the cable business, which
at the time was unusual because broadcasters were not in
the cable business. So I sent the letter to them
saying I love the cable business. I have a great
passion for it. I've done a lot of work. If
you're gonna build a cable division, I'd love to be
(25:07):
part of it. And they called me over. Remember Bob
Wright wrote on the top of it, bring this kid in.
I was the third or fourth person hired for NBC
Cable for NBC Cable. Through that, I built a relationship
with Jack Welch, who still loves you today, and that
love created all this confidence in me. It created a
(25:28):
willingness to fail, it drive to work hard. But mostly
I got to be in all these meetings that he
was in, and I got to see firsthand, whether it
was around cable or around broadcast, you begin to know
the questions that he's going to ask how he sees
the world. When I see you as a business person,
am I seeing some Jack Welch too? There's no question
(25:51):
you're deeply influenced by the people that you work with.
I got to work with Jack Walch, and I also
got to work with Bob Right, who ran NBC, and
they were very different. But by spending eighteen years at
that company and going to meetings and quarterly reviews and
business reviews, you think that you have the right question.
But it's the question that Jack would ask. Steve Ross
(26:14):
was that for me? Founder of Warner Communications. So I
had Jack and the second half of my career I
had John Malone. These are two of the greatest leaders entrepreneurs.
And that's lucky. That eighteen year old kid could never
imagine that he would have had the chance to learn
from and hang around with Jack Welch. That eighteen year
(26:35):
old kid would never believe that he would have a
chance to spend Saturday mornings talking to John while he
walks the dog and hear how he sees the world
and tell him what I'm thinking about and talk about
where the world is going and how to succeed. So
you made a jump from partner to law firm to
NBC Jeff to take a pay cut to pay cut.
(26:56):
Everyone thought I was crazy, including the people at the
law firm. What's the less than that for somebody who's
building their career here you are, had a nice career
as a lawyer, working with interesting people, and you took
a fifty percent pay cut to make a job somewhere.
You got to try and figure out what you really
love doing, what you're interested in as a lawyer. I
knew it wasn't gonna work when I was writing prospectuses
(27:16):
in the corporate department. And we sat at lunch one
day after about six or nine months, and a partner
came over and said that there was a change to
the disclosure laws that the SEC came out with, and
that from now on, there's going to be a new
way that you write paragraph twelve best six. And I
was at a table with like six really bright people
that I really liked that we're doing the same thing
(27:37):
as me, and they lit up, they were excited. I
remember thinking to myself, I could call us, and I
thought how am I going to compete with this group?
They're bright, they're hard working, and they love this stuff.
I remember going home that day, I think eight to myself,
I gotta find something else that I love. That's the
journey I think that we're all on. And that's what
(27:57):
I tell our interns that you may be in PR,
you may be in marketing, you may be in programming,
but if you're working at one of our channels, you
get to see all of it. Try and imagine would
you want to be that person? And a successful internship
might be that you didn't love PR, but you got
to look at marketing and you thought, maybe that's for me.
And I think if by age thirty you could figure
out you can move your way around so you can
(28:19):
get yourself into something that you're excited about, that you
really love, then it's a gift. You started out I
think as general counsel of NBC Cable work through business affairs,
business development, became president of NBC Cable, president of NBC
Universal Cable. You didn't want to be a lawyer. What
did you discover that that was sort of your superpower,
your skill that really made you you. I love the business,
(28:42):
so I was happy. I was happy to be there
and grateful to be there, and figuring out how to
get along with people because NBC was a pretty complicated place.
We had to work across a lot of divisions. If
we wanted to do anything, we had to also go
up to G and presented a G board. So there
were a lot of layers and a lot of different people,
and it was figuring out how to get along and
(29:05):
how to find support. You know, I think about you
and there are two things to come to mind. One
strategist and two you have this incredible people skills, but
you get people to talk listen. Well, was that developed
or was that a basic skill you had that sort
of came to life in the right circumstance. I do
love people. We're all imperfect. Everyone has a few things
(29:27):
that you admire look for the best in people. There's
a Brooklyn element of be a candid but also I'm
pretty emotional at times. And one of the things that
Jack worked with me on was that it's not show friends,
it's show business. Part of your job is to get
along with everyone. If you're having a real conflict and
it's creating an issue, there is no right and wrong
(29:48):
so you just got to try and figure a way
around it. And often there are personalities. There are some
people that just one conflict and there are ways you
can just step away from it, let him go argue
with someone else, and you got to stay away from
that negative energy. Positive energy is the most important thing
you need in a company to succeed personally. Positive energy
is the thing that a company itself needs to succeed.
(30:10):
Every idea you have the will to happen, and part
of that will is positive energy. We'll figure it out,
We'll keep trying, and when we find something they like,
we'll give them more of it. That's sort of what
the media business is about, trying to figure out with
every one of our channels, what are they like? And
then we get a rating, We find out how many
people watch, how long did they watch for It's not
(30:31):
what we think is going to be people should see
on Food Network or on the Oprah Winfrey Network or
on Discovery. We're really trying to nourish an audience. The
better job we do, the more they watch, and the
more shows they watch. When you were at NBC, how
hard was it to get support for your plans? I
mean you grew the business. As you say, you were
(30:52):
one of the first people hired an NBC cable became
NBC Universal, and you built out this incredible array of
networks where people leaning into cables. The thing we gotta
go or as you said earlier with everybody saying you're
stealing my money from broadcast, was it really tough slog
to grow? Well, first, it's never one person. I was
the guy that in the beginning that carried the bags,
(31:13):
and there were a lot of brilliant people that were
there with me in those early days that were very courageous.
Bob Right was one, a guy named Tom Rodgers was
fighting every day to build that business. Anytime you see
a business, it's multiple people. It was a big group
of us. We did face some real challenges. I remember
there was a great programmer at NBC at the time
named Don Olmaier, really like a legend genius by the way,
(31:37):
started the v M as with us at MTV. Really
he was at Nibisco and he said, I got an
idea for awards show. If you do it with me,
I'll sponsored. And he created the Skins game and golf.
He just had that brilliant touch and I remember being
in a meeting once and it was Jack Welch, it
was Bob Wright who was running NBC at the time.
There was Don Olmyre running entertainment. Dick Ever saw another
great legend, great friend of mine was running sports. Andy
(32:00):
Lack was running News. I was thirty five at the time,
and I remember thinking to myself, how did this happen?
How how am I in this room? But we were
in one meeting and CNBC was losing significant money. We
were invested with Chuck Dolan in a MC, in Bravo
and News twelve Long Island. We had invested in sports
channels with Cable Vision, and everything was losing money, real
(32:24):
money at the time, and Don Olmier stood up and said,
losing all this money in cable. For the amount of
money while losing in cable, I could do five more
pilots for NBC. This is nuts. Give me the money.
Let me do five more pilots. It was Welch's drive
to say, I don't care how much money we're losing.
(32:45):
The audience. Eventually, I think is going to go to
cable and we have to invest. Don's passion was real
because there wasn't a limited amount of resources he ended
up being hugely successful with the resources he had. Yes,
but when NBC sold that bit and this the comcast
of the profits of that business was from the cable business.
(33:07):
That vision of investing in the next medium and that
drive to do it even with the losses really paid off.
And it's one of the things that when I got
to Discovery fourteen years ago, it gave me real conviction
for launching new channels and getting out and building businesses
outside the US. When they started to lose, I had
that feeling of like, I've been here before, we have
(33:30):
to figure out how to grow You make the jump
from NBC to Discovery why. A big piece was that
Discovery was a great company. It had great ownership, the
new House family and John Malone. I was very close
to both of them, and they really wanted me to come.
So it was like I was going to a family
and a family that I loved and that I admired,
(33:52):
and it was a chance to run my own company
with some real autonomy. When I went to Discovery, the
real drive was how do we grow this? How do
we grow it in the US, how do we grow
it around the world? What else should we be buying
and Discovery itself was a brand that really had the
ability not just to entertain, but when Discovery was at
(34:14):
its best, had a chance to really inspire. After I
got to Discovery, we did Planet Earth. That's a great
example of a piece of content that really did more
than just entertain. It helped people fall in love again
with the planet. And it's hard to really care about
something if you haven't fallen in love with it. Planet
(34:34):
Earth really had an impact, by the way, still does.
I remember thinking to myself, that's why I'm here. This
isn't just about making money, This isn't just about growing audience.
This is about having an impact. I followed what you
did with great admiration at MTV when you took MTV
around the world and had a huge impact with culture
(34:56):
and fashion, and we took Discovery and sign and surround
the world, and in certain cases we made the demonstrable
decision that will probably never make money in this country,
but the idea that we could take science and Discovery
into countries around the world and the kids could put
the TV set on and they could watch this content,
(35:17):
they could have some impact. And so there really was
that real drive within the ownership to do well. But
it was also to really do some good and that's
part of the culture that still exists that. I think
it's one of the reasons we attract so much great
talent at Discovery. How would you describe the culture at Discovery?
(35:38):
Your corporate culture? Make sure you respect other people. People
should be able to come to a creative company and
feel safe and feel valued. We're great record on equal pay.
We really have a chance creatively to make a difference.
That's where we try and this thing wish ourselves. When
you came to Discovery, you really made a mark quickly.
Probably one of the most interesting things is what you
(35:59):
do with the gramming. We talked about Deadliest Catch earlier.
What was the thinking there? Where did that idea come
from that this is the direction we're going. It was
more of a basic point, which is the future of
this business is about owning great content globally and creating
great content and telling great stories and also having characters
that people love, whether it's Micro and Dirty Jobs, whether
(36:20):
it's Sig and Phil and Deadliest Catch. Jamie and Adam
are MythBusters. That was kind of the formula, great content,
great characters. Ultimately we were going to try and save
as much money as possible by running as an efficient business.
We broke the company in half. Everything that's not on
the screen, let's get really aggressive about every penny so
(36:41):
that we could spend more money on the screen. When
I got there, I think we were spending about hundred
million dollars on content. Today we're spending four and a
half billion dollars. And so the whole journey of Discovery
has been spend more and more money on content and
own that content everywhere in the world. We we're talking
earlier about the phone and where are people going to
(37:02):
consume your product? You were very early and jumping to
digital discovery. Go. You've done the Group nine deal, You've
got lots of plays there. How do you think about
the merger of digital and TV networks and their content
and brands. We're hedging in a lot of different areas.
The number one thing that we're doing is we're owning
all of our content. We did buy a significant interest
(37:24):
in a business called Group nine, which owns now this.
It's the leading provider of news for people and under.
Most of what we did a couple of years ago
was long form content, and now we're one of the
leaders in short form content and mid form content. Now
short form and mid form and not making money today.
But we've built a great group of storytellers that are
(37:46):
generating six seven eight billion views a month of short
form content, and we've built that expertise into our company,
which over the long term, we think it's going to
really be an advantage. Do you think this is like
in the days at NBC Cable and Don Olmeiner says
they're losing all that money. Give it to me that
you're investing for the future and this will have the
same kind of outcome as Cable did against Broadcast. I
(38:08):
don't know. This is a moment where if you have chips,
you got to decide, I'm not in this for the
long term and I'm not going to invest in a
lot of new stuff. I'm gonna generate as much near
term value as possible and sell the company. Time Warner
had that strategy. Jeff Bukas is a great leader, and
he was going to build that company to get the
most value for shareholders. There are a lot of companies
(38:30):
and media that are being run that way. When Bob
Iger said I'm gonna try and build Disney Plus an
ESPN plus two D and fifty million homes watch me
over the next five years. He took the opposite strategy,
which is, I'm all in in the future and I'm
gonna take my I P and I think I can
create some new platforms. I can create a competitor in Netflix.
I can create a sports Netflix type product. Five years
(38:52):
from now, I'm gonna have a more successful company, but
I'm gonna lose a lot of money in the meantime.
We're focused really in the same vein as Bob. We're
betting for the long term. So we are where I
think g E was when they invested in NBC, but
we're just much more diversified. We're not sure which one
of these assets we're going to end up being the
big Is it going to be Group nine, Is it
(39:14):
going to be the fact that we have the greatest
natural history and science global library in the world. Is
it going to be all the sports that we own.
Certainly all of them will not be successful, but we're
going to use all of our energy and will to
have them be successful over the next couple of years.
And it's going to take all that positive energy and
will to make it happen. So we wrap up each
(39:34):
episode as a shout out to the folks who make
math and magic work, the folks who provide the analytics,
which I know you use a lot of, and the
creatives who provide the magic. Who do you think is
the greatest analytics person? If we want to give a
shout out to the mathematician, who isn't John Malone? If
we want to say who's the greatest creative? Just that
spark of a raw idea that turns out to be
(39:57):
that idea that changes the world. Tom for He's a
great guy. Former guest here, you can go back and
listen to his podcast and you're exactly right. David. You
have had an amazing life, an inspiring career, and you're
a great pal. Congrats and thanks for being here. Thank
you so much for having me. Here's what I learned
(40:18):
from David One. Don't get out worked. It's something David
has been thinking about since his tennis years. He waits
up early and outworks the competition because he believes, even
if you have natural talent, hard work always wins today.
To take risk in the future now, even if you're
successful like Discovery was in the TV era, David believes
(40:39):
you have to invest in the next medium so that
you're well positioned when the industry inevitably changes. Three David
believes your company doesn't need the cater to everyone. If
you go after passionate consumers and stay true to your brand,
they'll keep coming back with the content they love. And Fourth,
when it comes to your career, David believes you should
listen to your heart and stay vigilant. David knew a
(41:02):
law career wasn't right for him. You should still work hard,
but be ready for an opportunity to make a move.
Thanks for listening. I'm Bob Pittman. That's it for today's episode.
Thanks so much for listening to Math and Magic, a
production of I Heart Radio. This show is hosted by
Bob Pittman. Special thanks to Sue Schillinger for booking and
(41:22):
wrangling our wonderful talent, which is no small feat Nikkiatore
for pulling research bill plaques, and Michael Asar for their
recording help, our editor Ryan Murdoch, and of course Gayle Raoul,
Eric Angel, Noel Mango and everyone who helped bring this
show to your ears. Until next time,
Host
Bob Pittman
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