VIA SATELLITE: What are your plans in terms of producing content in HD as well as 3-D HD?
Lee: HD has been a real growth area for us. About 25 percent of our [video-on-demand] libraries are now in HD. We have launched HD [video-on-demand] services in the United States and around the world. We are looking to do some other HD channels in the United States as well. That is a very important part of our growth strategy. This has given us a seat at the table domestically. Previously, we had never had a channel before, so HD was our way in. In terms of 3-D, that is something that manufacturers are taking a hard look at, and Hollywood is really firmly behind the growth of HD in cinema. But it is going to be a huge capital outlay on the part of theater owners and TV manufacturers for 3-D TV. I think it could be the way of the future, but it could be some time away.
VIA SATELLITE: What is your take on the advertising versus subscription models for pay-TV?
Marenzi: I like the subscription model. In terms of digital media, subscription works better than the advertising-supported model. That is not to say with continued fragmentation and continued rise of targeted [costs per thousand] on the Web for advertisers that they can’t have an inflection point. We both grew up in the pay-TV business when that was new media. We kind of like that subscription model.
Lee: There are multiple streams now. There is going to be subscription and online advertising. We have a lot of product up on Hulu, and we love the way that we are growing. As we go forward, there are going to be a number of different ways to skin the cat. We need to make sure that existing business models continue to thrive.
VIA SATELLITE: Can you give us one or two examples of new initiatives which you think have worked well?
Marenzi: In terms of something different, in Europe, we are seeing some 3G operators be very creative with their content strategies, and some are offering long-form content via mobile. In some places, they are putting their money where their mouth is. As the screens get bigger or more convenient or just better quality, that is going to be a growth area for us. Right now, that is just a fraction of our business, but we are seeing signs that there will be a big push in that area.
Lee: Hulu is relatively new. It is getting a lot of viewers. It is getting pretty entrenched as a platform and that will continue to evolve. We were an early contributor, [and] that is a pretty good example of a different platform.
VIA SATELLITE: Where do you hope to position MGM on this broadcasting landscape?
Marenzi: There is still a business out there for traditional TV with big brands and big platforms around the world. I think you will see more consolidation of niche channels and channel aggregators around the world so they can put up as much of a walled garden as they can, both in the linear and on-demand space, so brands will be more ubiquitous. I think you are going to see a lot more emphasis on branding on multiple platforms of content aggregators.
Lee: I think people would say broadcasting is in pretty poor shape because of the fragmentation going on. I think one of the things we do well is that out of a situation that others would find as dire, we find opportunities An example is called This TV, a network we own half of, which is a digital broadcast play network in the United States. We launched that earlier this year. It has been very successful for us so far. We have found a way to create some new business in the broadcast spectrum, so we are very bullish.
Email
Comments
Print
Reuse
