David Zaslav: Why Brands and IP Matter More Than Channels

biggest booster. He sits atop a large portfolio of lifestyle channels that grew this year with the acquisition of Script's networks, Interactive, the home of Food Network, h G t V, and other blue chip TV brands. What's interesting about this interview is the degree to which Zaslov admits that the linear channel's business is in slow decline. Discovery is now going

along in the I P business. Zaslov wants to amass content and brands with global appeal that can be sliced and diced in many ways for consumers linear and screaming. Zaslov offers details about the Script steal and recent investments

in professional golf and Olympics outside the US. He gives a candid look at how his mindset shifted about five years ago after he was challenged by none other than John Malone, a major Discovery shareholder, to answer the question how well would we do if people could watch whatever they wanted? David Zaslov, CEO of Discovery, Inc. Thank you

so much for joining us today. Thank you, Cynthia was looking forward to it so as we as two thousand eighteen winds down, I look at Discovery, I look at your stock has had an incredible run this year, and I look at a company that is very different as we close out than when you began. Of course, you had a big acquisition. You completed the acquisition of Scripts Network Interactive, which brought you a lot of great brands and talent and channels to put under your big roof.

You've done a lot of deals, a lot of activity overseas in the sport and O T T space, and I know you have a lot of you know, you have a lot of plans to come for the domestic market. Right now, in media, there seems to be a there's a there's a pressure on traditional media giants to transform,

to diversify and transform. Do you feel the pressure to transform the business that has been so successful for Discovery for the past years, No question, Um, you know, media right now is a it's a street fight, and I'm a fighter. I love it. I love the business. Well, you've got to look for every opportunity to train, You've got to look for every opportunity to create some winds and momentum. Um. It's been a great, great year for us.

But when you talk about traditional media, we really, uh, we were having quite a run as a traditional media company. When I say we were more cable and free to air around the world. Um. I've been here for twelve years, and for the first seven years we had a you know, an extraordinary run both in the market and grow growth around the world and here in the US. Um. But I remember a conversation I had with John Malone five

years ago. Our channels were growing double digit around the world in terms of viewership and uh, and our performance was strong. Our company had grown, stock had grown from about twelve dollars to eighty or eighty five dollars, So we really felt like we were in stride. And John and I talked about the future and uh. He turned to me and he said, Okay, we've grown all of our share. Um, how well would we do if people

could watch anything? And I thought for a moment, and I said, Uh, we made a lot of progress in the last seven years. We went from five percent of viewership in the US to thirteen and I said, I think we'd probably be back to five because a lot of our content, it's great quality content, but it's second choice a lot of it, and our brands aren't strong enough.

And so it was that day five years ago that we began the fight to change ourselves from a traditional media company to end a global I P company, and we started to change the kind of content that we bought produced, and we changed the way we looked at our brands. And Uh. That journey got us into sports in Europe, where we bought Eurosport two to three sports channels. It was one of the reasons we bought the Olympics.

In each case, the question was not how would this do at eight o'clock at night, but as this content that people would watch if they could watch anything. And in the last year or two it's gotten really a more a tougher question, which is will people pay for this content before they'll pay for dinner. That's why we bought the rights to the PGA Tour. Everywhere in the

world outside the us. Uh. That's why we bought most of the cycling in Europe and most and all the majors in Tennis, and that's why we're doubling down and continuing to invest aggressively with Oprah and candidly that's why we bought Scripts and this has been a great growth here. But we were a misunderstood company because when we bought Scripts, people thought we bought Scripts to get more linear channels

and to get synergy. We saw Scripts as an I P company that hadn't been really uh, that hadn't been taken advantage of globally. So we saw it as food, home, cooking, travel and and uh and do it yourself. They owned

all that content and hadn't been used globally. But but not just as a linear play but in the new world, when you look at food, when you look at home, aren't people going to want to consume content around on those genres everywhere in the world on all devices and so um, it's been five years and we got a long way to go and a lot to learn, but we are in We we made a real I think uh, we've had some some real acceleration in in changing the way our company is seen and saying and the way

our content is consumed here in the US and around the world. And that's why I think Ostagas has has really improved. What would you say, what do you think was the impetus five years ago? Was it the rise of Netflix, the rise of these on demand streaming services. No, at the time, it really was the screen on the phone, and it was the idea that we were really fighting over for the real estate of the TV set. And that's why we had such a hell of a business

we had. You know, we had gone from having four to five channels in a hundred and fifty countries to ten to twelve channels in over two hundred countries. And that was like beach front real estate. So if you put the TV set on in Italy and there's fifty channels, we have twelve. And you know, that was that concept. It existed, you know, everywhere in the world, and we were probably the most international media company um and we had boots on the ground and so we had a

great gig. And because we were in a uh, this kind of walled garden. If you wanted to consume content, there's only fifty channels. It really it encouraged this idea of well, we got twelve of the channels, so we don't have to make each of them great. We could make them pretty good and people will be clicking around, they'll run into it. And it was the screen that got got John and I on our board saying people

are starting to consume video content. It's not that far away, and in the end, people are gonna be able to choose to watch anything they want on this screen. Plus, you know, more and more people were moving towards the DVR on television, and then you had to be geinnings of Netflix, and so there were more choices and there was more of ability to choose and to say what do I really want to watch right now versus what's the best of what's on And so that was kind

of the beginning of this. Really it was a philosophical change, but it changed everything in terms of the way that we look at i P and then the way that we acquire i P and the kind of assets that we would acquire within Discovery. And you clearly have bet big in many markets on sports. Eurosport in Europe, I know is a huge priority for you. The p G A deal. Can you talk a little bit more about how the PGA deal came about. Did you approach them,

did they approach you? You have broad rights to all the PGA golf events in markets, if I'm not mistaken, everywhere but North America. Everywhere but the US, So we have Canada, we have South America. UM Sports came about because we just looked at the way people consume content and if toward De frances On and you love cycling, you have to see it. So it was this question and if you couldn't, would you pay for it before

you pay for dinner? And are we were just guessing, but our sense was yes, in the same way they are super fans for Oprah and for for Discovery and for a crime, that that the super fans around sport was going to be a really good bet for us. And so that's one of the reasons why we pushed aggressively into eurosport. And then we we built a player

with BAM. We built a direct consumer product over the last four years and on there you can get the cycling and the tennis and some of the football, with soccer, handball, Olympic sports UM and we started we learned a lot. In fact, we sat in this conference room made a list of the ten things we thought we knew for sure about the director consumer business, and eight of them were wrong because the way people consume content on a phone or on a device is a lot different than

the way they consume content on a TV. And that's what led us to the p g A. The The euro Sport Player has been quite successful for us and we think we could take it to the next level. But it's like a buffet. We we have a group of sports and for ten dollars a month you can you can get all that stuff. So you're watching the French Open, and then the next month you're watching Toward de France, and then you're watching the Diving Championships and

people like it. But the churn was high and we started to talk to people about it and they said they like the Eurosport Player, but often one of the reasons that they churn or leave is that they came for the tennis and there was in tennis for another three months, where they came for the cycling and the cycling season is six months and now they can you know, they like the other sports, but they'll they'll subscribe again when the cycling starts, and so we found that one

you need if you if you can have all of a sport, it's pretty compelling because it's almost like a magazine for people that loved golf or love tennis. They want to sume it all the time. They're real super fans, and you have to have a lot of it. We also saw what Adam Silver did with basketball in baseball very successful because you have a hundred hundreds of games, and so we looked at golf Um and we said, it's every week, there's multiple tours, there's live content all

the time. It's a very good demo and more than half the people on the PGA Tour are from outside the US and it's the premier tour everywhere in the world.

So I approached j um Monahan, who's the commissioner of the p g a UM, but he had already been studying us because he was looking at how the fact that Discovery is the most global company in the world, and we have because we have ten channels in every country and with the leader in sports in Europe, we have an ability to promote to our two consumers products that we have and we can create content in fifty two languages, and so when I went to see j Um,

we talked about our ambition to take golf globally and Jay talked about why his ambition was. It needs to be in every language, It needs to be promoted, and the characters need to be promoted on traditional platforms as well. You need to let people know about it, You need channels to tell people you should sign up for this,

And so we were really like a perfect match. It sounds like the PJ felt like their rights were under exploited outside the US, that they really needed to raise that profile and they needed to go with a company that already had experience going direct to consumer um and believed in it um. And for us, you know, we were already all in with this idea that you know, the p g a globally and we're gonna make some announcements in the next couple of weeks. We will add

to that. We think creating a whole ecosystem around a sport, or creating a whole ecosystem about around food or around home or around cooking, that's the way to go. And golf, I think just gives us a great opportunity to do that. And we're also you know, one of the things that differentiates us from everyone else is that we own almost all of our content everywhere in the world on every platform. So most media companies own the US right, so they own the linear rights. So if Arizon offers the NFL

on mobile, they get it from Roger Goodell. They don't buy it from from one of the uh the networks that own rights that it's not a sub licensing kind of thing. And so our philosophy is we're a global IP company, and the more great i P that we could aggregate globally, it gives us a chance to do what Facebook and Apple and Google and Amazon and Netflix have done, which has created so much leverage and wealth creation,

is that they go above the globe. They're able to take i P and essentially go everywhere in the world and say, if you love this content, it's it's like it's up there in a cloud. Anywhere you are in the world, you can you can hit your button on

your phone and you can watch this. It's completely different from the way our business started with local franchises, and so with the p g A, with the exception of the US, were above the globe and with all of almost all of our other content, food, home, science, crime.

Where above the globe philosophically and the above the globe allows you to amortize these incredibly expensive rights, whether it's for content or sports or is that I mean, that's the calculation because the Netflix example is great, but we all know Netflix isn't making money. How are you going to make these really turn these into businesses. One of the things is that we're really in a different business than most companies and media because most media is in

scripted series and scripted movies. So if if our business was a soccer field, and it was and I was going to my my my son's game when he was young, you know, scripted series and scripted movies would be the ball and almost everybody would be surrounding that ball and fighting over the ball. Where the rest of the field, And so, you know, our cost of content is a tenth to our average cost of content is four thousand an hour. The average cost of content for scripted is

you know, five, five or ten million. And and they're all competing for scripted content, in scripted movies and series to build you know, an HBO, a competitive HBO, Showtime, Netflix, all of these stars, all these very compelling director. Consumer offerings are starting to look very similar their scripted series and their scripted movies. But if you're a consumer and you want to consume content, if it's scripted series and scripted movies, you have ten choices for between ten and

fifteen dollars. But if you want to consume something else that's quality that you love, what's the rest of the stuff. And that's what we see. That's our field. So if you love science and natural history, you can get that from us. If you love Oprah, you can get that

from us. This is in the long term. If you love food or home, if you love golf, if you love cycling, and so we see ourselves almost as like a magazine rack, whereas you know, the most of the rest of the industry, they're kind of Entertainment weekly or their Time magazine or the kind of broad platforms that give you a little a fair amount of entertainment in

the scripted area. And and and so we're about quality brands that have super fans that we hope we're gonna pull us your bonappetite and town and country and like Golf Digest, you know, World Open Magazine, and that you know, those magazine. Most magazines are gonna go away, and people are gonna be having they're going to be consuming content and they'll get up in the morning. And you know, we think with Golf TV, they'll get up in the morning and they'll hit the off TV app, they'll read

about golf, maybe they'll book a teatime somewhere. They'll they'll in the afternoon, they'll pull it down and there'll be more articles about what's coming up this weekend, or about about which players are hot. Uh, they'll be instructional video if you want to work on your putting, and then on the weekend you'll be able to choose what tour you want to watch and you can watch it on your phone or you can watch it on any device.

And um, So we think the possibilities by owning this i P is the compelling possibility is that we can now go direct to consumer with this. But we also have the optionality that if Apple wanted to go, they're already above the globe. They're already in business with five million people that they have credit cards and they're selling

them products. If they want to sell i P two people everywhere globally, you know what company could sell them content with characters they know, brands they trust, uh and and stories that they that they would want to watch, you know, in in all these day for an areas and you could choose. And so whether it's Apple or Facebook or Google um there, you know, or us doing regional deals. You know, I was with um with with the Hans the other day from Verizon. They have a

hundred and ten million phones randall. You know, these are two great executives between the two. Between the two of them, they have two uh million homes I mean devices uh screens, And so how do we get our stuff on those screens? And so we can do it ourselves or we can sell to all the regional players or the global fan companies, you know, depending over the next couple of years what

they feel that they need. But we're starting to see now for the first time that a lot of the big cable, satellite, and mobile companies, as well as the fan companies, are more and more feeling like they maybe need some I to either help their platform or decommoditize their platform. Are you having those conversations with the Apples and the Amazons that do seem such a fit for various reasons, with your lifestyle centric channels. We're I mean,

we're talking to everybody. You know. We'd like to be on every Horizon phone in America, T Mobile phone, a T and T phone. We'd like to be all across Europe on Deutsche Telecom and Voda Phone. We're a little early, you know, I think, um philosophically, you know, we've made the decision to go I P long, So we do we sell very little of our content, uh to other distributors.

Were holding all of it because we think someday, you know, the ability to go sit down with Amazon and do a deal around food and cooking in the kitchen with Alexa globally. And if we did that and they said to us, okay, well, how much of your stuff, your recipes and your short form and your long form content, can can we get day one, we would say all of it. And it's already in you know, X number

of languages, and so we haven't been selling it. There are other media companies and these are this is also a good model, which is create the content, hold it for your linear platform, and then sell it off everywhere in the world. But so we're I P long and we think in the long term you know, being an I P company will will UH will create a lot of shareholder value and also make us a sustainable growth company.

Because if we're right, then the mobile companies, satellite companies, and the fan companies over the next couple of years, A're gonna say I need some more good stuff, really good content of great stories that people love. And they'll look around. They'll say, let's talk to Discovery. They have all this great women's content or great lifestyle content or

great sport content. And and at that point it'll, you know, our whole company will look different because our content will be we won't be just we won't we won't have just a growth company. By putting our content on free to air channels and cable companies, our content will be on the billions of screens and they'll be they'll be pushed by the regional players or the big fan companies because they'll want that content in order to UH to

delight their customers. It sounds like the scenario sketching out sounds like the fang companies become a next generation Comcast or cable vision that they become Netflix. UM is that kind of that is your sense of their ambition in the video space is to kind of become those aggregators.

It's it's it's clear that the platform companies, those that are built broadband and phone and cable, um, when they compete, they look very much alike, and so more and more they're looking to have I P to decommoditize their platform. In Europe, a lot of the mobile companies bought the football, bought the soccer in order to to differentiate. So if you bought BTEE, then you've got all this great football. Um, you have T Mobile giving away uh Netflix to customers.

You have Randall doing a T and T now a bunch of free stuff to the best users. So if that trend continues, I think we see it on both tracks. We see the big platform companies in Europe, Latin America, Asia, the US that have invested in building broadband, phone and cable, they're gonna need some special stuff for the broadband users or the phone or their mobile users and will have a full menu to say, you know, in language, what do you think would help you? We're open for business.

And the fan companies are more and more trying to get people to spend more time on their platforms or to love them and you know, wanted to give me hard at times it's hard, you know, right, and and and and maybe because of what's going on now, having more great characters, great stories, or if you're a super fan of science and you can go uh to to one of those fan companies and get all kinds of great stuff or get all kinds of great stuff on food or home that could you know, that could be

quite appealing. And so we're betting that between the fan companies and the regional platform companies that there's going to be a market, but we're not. That's not where we're putting all of our chips. It's one of the reasons we're going ourselves direct to consumer with a lot of our businesses. We we have a business called motor Trend on Demand where we aggregate all kinds of car content.

We're with the largest provider of of car content long form plus short form, and then we have loads of car auctions, and then we own the Motor Trend brand and trucker and automobile and we put it all together in a direct consumer product. But we're doing it with sports in Europe, We're doing it with cars, We're doing it with golf, we're doing it. We're gonna do it with cycling, We're gonna do it with tennis, and so these are all We're not gonna eat for someone to

put us on their super highway. We're going to start ourselves. And in creating those ecosystems that you say around genres and around fan bases, it sounds from what you're saying that this is really that this is really a streaming world. That the linear that the linear TV channels which are still so strong and generates so much revenue now that those are increasingly not the rear view mirror, but they are in your future plans are much more about a

streaming on demand world than servicing a linear channels. Is that fair? Well, we're able to do both now. So right now we have our our company is growing with our our cable and free to air channels around the world. Um, we're making over a billion dollars outside the US, our channels are quite profitable. And when you look outside the U S subscribers you know, with all the noise, are still growing two to three globally, and so people are

spending less time consuming content on television. You know it, There is a secular decline, there's no question about it. Subs here in the US have declined, although that seems to be ameliorating. And we think with skinny bundles, you know, it may it may true up to look more like what things look like globally than instead of down three,

maybe it's down one or even or up one. But it's fair to say that we think we have a nice sustainable growth business with our traditional channels around the world, but we think it's very important to get a relationship with the customer either for free advertiser driven or get their credit cards for those that love a particular area, and we can super serve them, and that that combination could be really combustible in a in a way of

creating huge value. Where we have a traditional business that maybe in decline, but our our company itself right now

has never generated more free cash flow. You know. We we have a target of generating three billion dollars in free cash flow a year, and so that's off of our traditional business, and it's with investing in all this i P and it's with investing in in in this content so that we own it globally on all platforms, and so we think we can do both generate a lot of free cash flow off of an existing business, even if it declines a little bit over the next several years, and then use the i p that we

have to create a direct relationship with customers in a way that no one else can because we're not We don't have the same story. We're not saying, hey, here we are. We've got great movies and a great scripted series. We have a whole different entry point with customers, which is, you love golf, we have all of it. You love Oprah, you want to spend time with us? Uh. If you love science, we have the best science library in the world.

We're doing it in long form and short form. Tell us what you love, will give you more of it. So we think we have a different entry point. Does it make you nervous that the neat GEO Worldwide Group is now joining Disney, the largest media company, the company in the world. Disney is a There's no better company in the world in terms of building brands. Um Bob has done an amazing job and they do have a real global sensibility on every you know, uh, in every sense.

Having said that, in most markets, Animal Planet beats nat Gio and Discovery is four or five times the size. One of the advantage that Natzio was getting was on the Sky platform. Uh, they were getting a big advantage in the UK, Germany and Italy because of that connection, toy Fox because of the connection, and so they were being uh meaningfully supercharged. So you know, that may continue or that may that may that may be an opportunity for us now that Comcast is about to take over Sky.

Right having said that, I think Disney is a great competitor, and um, we'll have to get a little better. The good news is between Animal Planet, Science and Discovery, um, when much broader distributed in many markets, we have two to three channels, natural history channels on analog and they're on digital. So when you really look at nat at Nazio versus the Discovery natural History channels and Discovery itself, Nazio is at least today much smaller. Let's talk about

let's talk in more detail about the Scripts deal. I'd love to unpack a little bit. I know that that you and Scripts had kind of flirted on and off for a couple of years. What was it that made what was it that made the transaction happened? This time around what what was the who who made the first phone call? What was the spark that really led to

that led to your deal? Um, we were we we We had made three other attempts at scripts UM and the family wasn't ready to sell, so that those times they said, sometimes sometimes it was after a significant, a meaningful period of time of discussion, and sometimes it was pretty abrupt. You know, we're just not ready. I think the decline in the marketplace probably had an impact on the family, the fact that they hadn't UM broadened out internationally.

You know, we saw, for instance, in Latin America. UH we have twelve channels in each country, and we have a channel called Home and Health. It's the number one channel for women in UH in Latin America on cable, and we launched that about nine years ago. It's it's

effectively like h G TV, Food and Health put together. UM. They hadn't gone down their scripts and so about a year ago, a year before we did our transaction, they decided they wanted to try and launch some channels in Latin America, but well, it was left was digital tears that you had to buy through, and so I think they recognized that they had built a fantastic business in the US with great brands and a great leadership team.

Ken did an extraordinary job with that company and really understood storytelling and brand and had to nourish an audience. But they hadn't invested outside the U S, outside of Poland where they bought a business, and so I think when when Ken looked at the business, he said, a lot of the growth is going to be outside the U S. We're way late now, um, and I'm not

sure we're big enough. And so between Ken and the family, uh, they pretty quickly came to the conclusion that they were really serious this time, and it became it became about, you know, a real uh. We thought we were in there ourselves over price or it was a very competitive auction. We thought originally we were in there ourselves, and then we got the feeling maybe somebody else's is in there

with us. And then it turns out that Viacom thought they were in by themselves, and then they found out that, you know what, maybe there's somebody maybe there's somebody in the house with us. And it took us a while until we saw each other, but we were both there in the spill Tennessee Airport figuratively UM and it it

it ended up being you know, a competitive a competitive bid. UM. We did feel at the end that this was quite an important transaction for us because we felt that we could really supercharge all their i P around the globe, launch new channels, put their content on our platforms around the world with almost no cost because we already have all these channels, so we could actually save money from

buying content and put their content on UM. We looked at their i P and we thought this was really right along our strategy because they owned all the content and they hadn't hadn't really deployed it or or encumbered it. So we looked at food and we thought, between food and cooking that we could really make something, you know, in the long term outside of channel of the channel business, we can do something that people you know, would would

really care about and spend time with. I mean, when we looked at food, we actually thought to ourselves, UM, that food is the one area where every person in every language, everywhere in the world asked the same question every day, what's fit dinner? And not everybody asks what's what time is the p G A on today? Not everybody asks, you know, for for seeing science content or space content. Not everybody wants to see crime content when they get up every day, but everybody asks about food.

And so we saw their I P the food, the cooking category, the home category, all those is fitting so great with ours. It made us bigger, uh, And there was We thought that'd be a lot of synergy there because we do the same things. I. I started out being a business development guy at at NBC and we did a lot of transactions and in the end we did a lot of big transactions. But like when we did the Universal deal, we weren't in the movie business.

That was a whole different business. We weren't in the theme park business, but they had cable channels and NBC was in the cable channel business. And so there wasn't a lot of synergy because there was in in the theme park or or or movie business because we weren't in it. Whereas here we looked at scripts and we said, this is exactly what we do, and we think we

have a lot of the quality brands in cable. They have a lot of the quality brands in cable and today and together we have almost all of the quality lifestyle brands and cable um and between h G Food, I D, t LC and Own, we had five of the top six channels or seven channels for women. And when we when we put it on the back of an envelope, we said, wow, you know we we could be the number one or two player in America on

television and reaching women. And so we were convinced that this was a transaction that could have really long term value for us. But the street and the narrative around the transaction uh as when we closed it, which surprised us,

was two linear TV companies coming together. It was there was a little underwhelming response that was there was a positive narrative, but it was there was a there was a more there was a more overwhelming negative narrative, which is two companies that aren't big enough that are going to come together and they'll uh and they'll they're both linear TV companies and together they won't be there'll be

a little stronger, but they won't be strong enough. Are The way we saw it was where an I P company, We're buying this great i P that's not deployed globally, and we could put it to build our near term linear business, but we could also have it build our

I P future. And a lot of this year was about really changing that narrative, showing that we're more than just UH our twelve cable channels coming together with their six that together where we reach more people, that we that we have an ability to promote between our channels, which can give us real which is unique and give us real growth, and that we could take their content around the world and that ultimately they add to UH to our menu of global I P and what we

can offer directly or through regional or or FANG type companies when people want to consume content on a device. I know you this year, as you said, has been

a lot about integration and getting the right management. What of what you've seen so far programming initiatives, branding initiative, advertising initiatives, what has what would you say is like the most exciting UM development that that you can see of the two brands coming together on the traditional side, I would say that on on any given night, UM, when when you when you tell we have we have three or four the top five channels for women, and when you put together the rating of our top five

channels for women, we aggregate somewhere between a four and a seven and over a seven rating for women, and where advertisers used to have to gobble together a lot of different purchases with a load of different cable companies, we can offer on any given night, Yet broadcasters in most cases getting a one rating or a one five or maybe a two rating in the women's demo, and on any given night we're we're getting a three, four

or five or six rating. And so one big reveal was that that we have a very big female audience that's really engaged and that watches us alive, and that that's very powerful for advertisers. The second is that, um, we used to spend a lot of money telling people about our shows, but we couldn't tell them. We could tell them what channel it's on, but we couldn't tell

them the day and the date. But now that we own all these channels, if we have something great coming up on TLC on Sunday night at eight o'clock Fiance, we could at at seven forty five and at seven fifty nine run a promotion that t LC at eight o'clock tonight on h G Food, I d Own Travel, Animal Planet, We and and we built a very strong, UH aggregating marketing vehicle that is distinguished because we can do day and date, and we could also do it in a way where we made the decision early that

we think if someone's watching I D in there and and it's it's a minute to eight, if they don't like what they're watching, they're gonna click and find something else. So we have no problem telling people on I D there's something great coming up on h G t V and it's or there's something great coming up on the Food Network, a new episode of Diners and Dives, you know, with Guy Fieri, And it's one of the things that last quarter, our we actually grew at percent when the

rest of the industry was down nine or ten. And we think part of that is that we were able to promote much more efficiently. Our reach grew by with

this transaction. And you know, also we think we got lucky because we don't own any broad entertainment channels, and broad entertainment channels today are much harder because if you want to see a great scripted series, you're gonna go to f X or t N T or TBS or USA, maybe because they're really good channels, but you could also got so many places to watch a great scripted series, and we have We don't have any of that kind of stuff, you know, except for we own which Is

which is, you know, a great service for African and mostly African American women. But our channels are about affinity groups that love food, I love crime, I love home, will love uh natural history. And so I think part of the industry moved in odd direction. Um, we're doing. We're doing pretty well. My last question for you, David, thank you so much for for your time today. Um, everybody in media is talking about the M and a marketplace. Do you see is Discovery? A buyer is Discovery? A

seller is Discovery? A status quo for now company? Well, I love, I love Discovery. UM. I came here to have an impact, and I uh, you know, on a personal level, you know, I'd love to be here for the long term. And we're building the company so that, you know, we have an opportunity to have real sustainable growth. And since we're doing we're in the nonfiction and sports area, we think from a scale perspective, we have a real chance. Um, but we're a public company and there is a lot

of trans actions there are a lot of people. You see seventeen times Comcast was willing to pay for Sky. We have a much bigger, bigger content business across Europe. UH Disney was very clear about wanting to get bigger internationally between the sports and our international business. We know we have a lot of attractive assets. What we have going for us in terms of sustainable growth is our company is really turning into a free cash flow machine, a lot of it having to do with Scripts and

US coming together. We have a target of three billion a year of free cash flow, and if we reach that then over the next four years we'll be generating about four billion dollars in cash and that will give us the optionality of either investing in the growth businesses that we have, whether it's direct consumer or more traditional, of buying back our stock, of doing our own transaction buying some assets so that that where that scale will help us ashore sustainable long term growth um or be

in a position where we're we're attractive if we need to be given our set of assets over the next couple of years to UH to be part of somebody else's big company. Free cash flow just might be catinet for some companies in the hunt for earnings so well, we will stay tuned. David, as always great to talk with you. Thank you so much for your time, Thank you, thanks for listening. Be sure to join us next week for another episode of Strictly Business. Yeah,