Turner Broadcasting boss says pay-TV challenged as millenials think content is free

Gerhard Zeiler

Gerhard Zeiler speaking yesterday

The president of the Turner Broadcasting International has warned the subscription television industry faces real challenges in engaging young consumers and combating the growth of piracy globally.

Speaking at yesterday’s ASTRA conference in Sydney, Gerhard Zeiler, who heads Turner’s operations for brands like CNN, TNT, and TCM in Asia Pacific, Europe and Latin America said that solving both problems would be crucial to the future of the television industry.

“We have a problem,” declared Zeiler. “There is a phenomenon which describes that a significant percentage of millennials, in the US it is almost 20 per cent, have no pay TV subscription and don’t show any inclination to get one. To get them into the pay TV system will be a challenge, I admit that.”

Zeiler, whose speech came shortly before Foxtel CEO Richard Freudenstein announced a substantial drop in the entry price of subscriptions at the conference, said the global subscription TV industry had failed to address the question of how to engage younger audiences who were digitally engaged and expected content to be free.

He said: “How do we get the millenials into our system? The ones who have grown up in that internet culture, where everything seems to be free of charge. The ones who navigate themselves through the web faster than anybody else and the demographic group who watch more than any other demographic group on the web.

“We have to be honest. As an industry, we haven’t even started yet to tackle this challenge in a meaningful way.”

The senior Turner Broadcasting executive also described piracy as the biggest threat facing the industry.

“We shouldn’t make any mistake, piracy is a risk and danger for all of us. It has multiplied in the digital area. And this is actually the scary bit – has become for many people, especially young ones, a normal way of listening to music or watching TV,” he said.

“From my point of view, it cannot be said often enough. Piracy is theft. Theft which cannot be accepted or excused by any argument.”

Asked about the potential arrival of Netflix in Australia Zeiler said from a global perspective Netflix should not be allowed to tie up the streaming market in various countries, adding: “Netflix will not be the only player in town when it comes to the international markets.

“Europe is different. Australia’s different. Asia-Pacific is different… the international markets know exactly what happens if you allow someone to become a monopolist, and if you ask Netflix in terms of SVOD play and OTT play, yes, it’s more or less a monopolist.

“There’s Hulu, but Hulu is rather small compared to Netflix. If you look at the international market there are a lot of countries, including the UK who have a huge amount of competition.

“Plus you have platforms who learned maybe from the mistakes or from the slow reply of their cousins in the US, that they can’t afford to do that in their own markets. So wherever you go, whether it’s Germany or France, where Netflix has announced a launch this year, or other markets, the platforms, the distributors are prepared to put something next to it. ”

Nic Christensen


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