Latin America is Key to Discovery Communications International Growth

A few months ago, a group of Discovery Communications’ high-ranked executives met with President Calderón in Mexico City for an informal meet and greet at the presidential palace (Los Pinos.) During the visit, the Mexican leader took the opportunity to ask about the need of telling more “positive” stories about Mexico, a country that has been plagued by an increase in drug-related violence.
The meeting, Discovery Networks International President and CEO Mark Hollinger told Portada, was mostly a friendly one, as the company does not face major regulatory obstacles in Mexico as is the case in several countries around the globe. It also signal’s the importance Discovery places is growing its business outside the U.S: Currently, the two fastest growing areas for the company are Western Europe and Latin America.
With 23 brands in 180 countries and territories, Discovery Networks International has made international expansion a crucial part of its growth strategy. While only 10 percent of the company’s revenue came from outside the U.S. five years ago, this figure is now of 33 percent –and growing. “If we want a long and sustainable growth, we are going to have to grow outside the U.S.,” Hollinger said recently at an international press junket in New York City.

Hiring Local Talent

Interestingly, Discovery has also made it a point to hire local talent in the countries where it operates, instead of sending executives from the U.S. to run an overseas operation. “We are not an ex-pat hiring type of company,” added Hollinger, who says most of Discovery’s operations in Latin America and elsewhere are ran by local leaders. Under the umbrella of its Latin America/U.S. Hispanic division, Discovery runs 13 networks in 34 countries and 3 languages; including two HD networks (Discovery en Español and TLC,) in a region that is only beginning to explore High Definition, offering yet one more area of growth.

Overall, Discovery’ Latin America/US Hispanic networks rank among the three most viewed pay TV channels in Latin America, per Ibope, with some blockbuster series including Las verdaderas mujeres asesinas, Pareja salvaje and Cómo funciona el universo. Only in Mexico, Discovery Channel’s ratings increased 12% in Mexico in 2010, compared to the year before, making it the most widely viewed non-fiction network, also per Ibope.

The company, which spent $800 million in content in 2010, is expected to invest up to $1 billion this year, with the lion’s share of the investment going towards developing home-grown versions of programs including Don’t tell the Bride and Gypsyville.

During the presentation, Zaslav also said that he has been spending an increasing amount of time outside the U.S. and he expects to spend about 40 percent of his time on international trips. Another executive, the recently promoted Luis Silberwasser, jokingly told reporters his permanent address is now seat 65A on some transatlantic Virgin Airlines flight.

Discovery en Español will be holding an upfront presentation on May 18 in New York City.