SBHD: It’s a year since Super Channel was bought by NBC. What can it offer its viewers?
NBC Super Channel, the pan-European news and entertainment channel, faces the arrival of not one but two new competitors in the next two months – BBC World and European Business News. A year after it was bought, and turned around – by US network NBC – how will Super Channel compete?
The question is almost irrelevant to the broadcaster’s head of sales, Peter Bullard. By December 1, NBC Super Channel was available in 62.6 million households across Europe. "BBC World and EBN won’t have even 6 million by the end of next year," he says.
But it hasn’t been plain sailing for NBC Super Channel, and Bullard is the first to admit there is plenty to do in 1995. Before it was bought by NBC in 1993, the channel had a disparate range of entertainment, home shopping and paid-for religious programming. Since NBC took control, it has repositioned itself as a more upmarket service for the pan-European business community.
NBC – the US’s largest network by individuals reached, although second largest when ranked by household ratings – acquired Super Channel as part of a plan for global dominance. It also has interests in South America and Asia. The plan is to offer a global news and business service that never sleeps.
The priority for 1994 was "shoring up" the channel, Bullard explains. But in the first year virtually all aims were surpassed. Before NBC arrived, 40 per cent of revenue came from home shopping; 15 per cent from paid for religious broadcasting; the same again from basic direct response.
However, in the year since the channel relaunched, home shopping has been cut by two-thirds, religious programming dropped and factual and entertainment strands introduced. Ad revenue has grown by 92 per cent.
Last month, the channel secured its first sponsorship deal with Volvo for the creation of a pan-European weather and travel report. It hopes sponsorship will account for five to ten per cent of all revenue in 1995.
Change has been driven by new programming and confidence in the financial muscle now backing the channel, Bullard believes. And contrary to popular belief, this has not just been a matter of NBC scheduling its own US production. True, Tonight with Jay Leno is a major part of the evening schedule, Bullard concedes. But the channel "easily meets" the EC quota requiring 51 per cent of output to be EC-produced, he claims.
From this month, news and current affairs output will increase by 25 per cent with the launch of European Money Wheel – six hours a day of live financial and business news produced by Financial Times Television. The channel also broadcasts ten hours a week produced in-house, ten hours a week by ITN, ten hours a week of sport from Parallel Sport and an hour a week each from German broadcaster ZDF and TFI in France.
"Over the past ten years in Europe, we have seen much more TV but not necessarily much more choice," says Bullard. "The economics of the business usually means channels must deliver a mass audience to target the Procter & Gambles and the Unilevers."
CNN, Eurosport and MTV offer discrete audiences, he says. And despite agency scepticism about the viability of pan-European advertising, these channels – and NBC Super Channel – have a valuable, and increasingly important role to play.
"Like the youth audience reached by MTV, we can offer a homogeneous audience of light TV viewers hard to reach via any other broadcast medium," says Bullard. "We’re not saying everyone is the same. Nor that pan-European channels are right for everyone. But there are many reasons for advertisers to go that way."
Bullard counters criticism about the quality of NBC Super Channel output across the entire schedule. "It would be unrealistic to try to create a 24-hour schedule everyone loves," he says. "We are working to create a brand." He adds: "Our brief is 18 hours of news and information, but entertainment plays a part too."
Research to support the success of this policy is patchy. With no standard pan-European audience research system, pan-European channels must rely on local data. But Bullard claims that the pattern experienced in Holland – where the channel has moved from 25 per cent behind CNN to 25 per cent in front – is replicated elsewhere. Research will be a major priority for 1995, with investment in an in-house facility to harmonise data across all NBC international operations.
So, what of the new competition? "Any new competition must be welcomed for increasing the number of people on the ground spreading the word," says Bullard. "They are not the real competition, the press is." For it is pan-European press advertising that Bullard hopes to encourage onto TV as the market grows.
"BBC World and EBN will need to achieve critical mass to become an attractive buy. With ourselves, CNN and Eurosport all at around the same penetration level – between 50 and 60 million homes – the battle next year will be distribution." Should they achieve this, Bullard still doubts the newcomers will have a significant impact on existing players.
With "relatively low" operating costs – about 25m a year – a pan-European channel can survive without mass penetration, but only if its backers are strong. "There is no question that without muscle, you can’t do this. I don’t think even Pearson is in that league, and certainly not the BBC."
There is, he adds, only one way to make a small fortune out of pan-European satellite television: "Start with a big one".