Welcome to Strictly Business Varieties, weekly podcast featuring conversations with industry leaders about the business of media and entertainment. I'm Cynthia Lyttleton, co editor in chief of Variety Today. My guest is Takashi Nakano, Senior director of Content for Samsung TV Plus. Samsung TV Plus is the biggest streaming platform that you probably have never heard of, but it is
becoming a force and entertainment. The South Korean electronics giant has embraced the fast channel market, building in hundreds of free streaming channels into the operating systems of its connected TVs. Samsung has sold more than six hundred million such TVs in twenty four countries in recent years. That means Samsung is creating a very different kind of network, one that's not bound by geography or someone searching for a specific outlet.
Samsung's menu of free channels is available the minute consumers turn on their TV sets. Samsung isn't the only TV manufacturer in this game, but they are far ahead of their competition. Nikano is based in Los Angeles. He's a cable veteran who joined Samsung in twenty sixteen to help
it grow beyond the hardware side of television. Before that, he worked in distribution and affiliate sales for Discovery, Scripts, Pop TV, and GSN As Nikano explains, fast channels are evolving into a new form of basic cable and a new form of syndication for creatives and profit participants. He walks us through the ins and outs of how Samsung
has grown the business over the past five years. He's also really candid about how the company flocked with its first effort focused on paid VOD offerings and what they learned from all those mistakes. It's all coming up right after this break. Takashi Nakano, Senior director of Content for Samsung TV Plus, thank you so much for joining me today.
Sure, no, thanks for having.
Me well as you As you probably know, I've been knocking on the door of Samsung TV Plus for a while now because I've seen you've been doing a lot of interesting stuff. You have been, you know, aggregating and bringing together fast channels. You've you've been doing a lot of interesting stuff just with the Samsung platform and the operating system that you have, and in making the decision to really go for it with fast channels with free
streaming ad supported content. You've created a different kind of network that's based on Samsung TV devices, which at last count is somewhere over five hundred and seventy one million around the world. It's an intriguing kind of network that you've built. I'd love kind of the thirty thousand foot view of Samsung TV Plus. What encouraged Samsung, which is a very established name in consumer electronics, what encouraged them to go deeper into the content side.
So it's interesting we started this endeavor. I joined Samsung in twenty sixteen and I was originally brought over to launch a virtual MVPD. That's when Sling was launching, Direct tv Now was launching. So the idea was to integrate a video ecosystem into the TV and everything at that point was pay. We had modeled it a number of different ways, We had talked to partners, and it was just a business that was never going to really be profitable,
and we pivoted from that point. We you know, simultaneously, we had launched a transactional vod store in twenty sixteen as well. It was it was called TV Plus, and interestingly enough, it was a gigantic failure, but we learned a lot.
Sometimes that's the benefits, can you know outweigh the fail.
Right, you know, we we had a lot of We didn't sell many assets, and part of it was execution, part of it was market dynamics. Transactions weren't really we weren't doing it well. But what we learned was a lot of people came in to look, to browse and look. And simultaneously, Korea was building this idea of you know, Caro selling movie trailers and used in leveraging an impulse pread, an impulse pay per view experience to buy and red movies, and so they were car selling trailers into a into
an EPG. And we liked that idea and what we ended up doing is bringing that to the US, not the transit what we we had a separate transactional element. But what we really liked was the fact that you can integrate channels essentially content into an electronic programming guide without the need of any additional hardware. You just go to Best Buy or Amazon would deliver your TV, bring it into the house, hang it from the wall, and connect to your Wi Fi and you would just get content.
And that was very interesting and without the need of a cable box. We believe integrating content into your electronic programming guide was very much akin to what people are used to doing. Anyways. Yeah, it used to be called cable Yeah, even before that, it was called broadcast TV, right, So I think that's what really kind of set us down this journey. We didn't have content obviously, we were a hardware manufacturer. We were knocking on a lot of
doors looking for content. Most of it was available, you know, most of it was on YouTube, and it was short form and it wasn't really situated well for TV. We we at that, you know, at that point we had a small strategic investment a company called Pluto TV. Heard of them, so we had a small minority stake in them early days, and we launched ten channels and we were off to the races. So it's been an interesting journey, and for us, it's obviously evolved from the ten channels
that we originally launched. We had learned a lot from that from those ten channels that have expanded to you know, over four hundred channels now here in the US. We're available in twenty four countries, thousands of channels around the world. It's an interesting it's interesting to see the scale that it's grown to and just you know, the all five short years.
Is there are there things that you can do because you are a device based network. Are there things that you can do for advertisers or content providers that others can't? And I know you have such a depth of experience in the multi channel world. I'm curious if there are like benefits to the kind of uniqueness of the Samsung network.
Yeah. The ecosystem that we have today is you know, it's very much from the outside looking in. From the user's perspective, looking at the service, looks like television, right, but on the backside it there there and on the backside it looks very different. It's very digital, right. And when you have a digital ecosystem, you're essentially able to send one feed to one device in a unicast model around the world. That model has given the ability to
sell dynamic insert dynamic ads. We're able to have real, real life measurement and understand who's watching what in real time. Everything. The beauty of digital is all transferred, you know, with the simplicity of using television. So I think that has really if you take that and see what we can
continue to do with it. The you know, the world is our oyster, and we think that if you have access to the hardware you have, you understand what the users are doing, and then you understand what the future of this content world is going into and you can combine all that to think all those things together. Really, the opportunity of media and the future is unlimited, and that's what's exciting to us right where we're not you know, I came from traditional cable. We had we were fighting
for qualm space essentially. Right we were fighting for a channel, trying to get launched with direct TV or Dish or Comcast, and that was a billion dollar investment to do one channel. Today you can launch a channel for thousands of dollars and the dynamics are very different and what you can do with that type of economic structure and now the scale of being able to deliver content around the world because you're not terrestrial based, but you really you live
in the Internet. That's awesome and we don't. We're exploring all the elements of what that looks like in the future.
It's really when you think about the potential, it can kind of blow your mind when you think about it. Are you able to see what people are watching, and do you have visibility because it's going through the operating system, do you have visibility into what people are watching, how much they watch, how they how they surf channels.
Yes and no. Yes, in the sense that we do. You know, on a macro level, we understand that. But in a micro level, it's not usable in much of the In much of the experience, there's just too many people consuming too much content to make anything that a lot.
Of data points to consider.
It's not actionable in that sense. But you can identify trends, you can identify you know, how people are consuming, what they're consuming, and why they're consuming, and where they go to next, and how these kind of patterns, these macro shifts are changing. So it's exciting to see that, you know,
and I think we're we're learning right every day. It's it's it's a learning experience around how content is changing and how people are navigating, you know, whether it's sports, whether it's news, whether it's general entertainment, why people turn on the TV and watch what they do, and it's you know, how different parts of the country watch different things,
how different parts of the world watch different things. It's interesting to see that, and it's and it's difficult to navigate all of those different points and understand how do you take all this data and distill it into you know, actionable, forward thinking content decisions. But that's what makes this job so exciting.
That's absolutely the challenge. I mean, again, having come from the traditional cable ecosystem, do you think is it is it fair to say that fast is the new ad supported basic cable.
I think that was our premise when we started, and you know, five years we fast forward now, you know, five years later, and there's no question, right, there's there's no question that what's happening in the pay TV world and I came from that place. I understand that world. It's changing, you know, significantly, and it's going to continue to change, and how it evolves is going to continue to is going to continue to change. But it's the
way people are going to watch TV. The value proposition is just too strong, and we're seeing the growth and engagement daily and now when you can mirror that with great content together, we see a hockey stick effect.
How the economics of all of this for the creative community have been you know, of this sort of the digital transition have been challenging for sure. Can you kind of talk through how it works, how your approach to the to content owners. Do you do things like largely on a rev share basis? Is it different depending on the deal.
Yeah, Our deals vary across the board. You know, it's to take all content creators and put them into a bucket of where they are, you know, structurally and economically, it's tough to do. You got everyone from the biggest and the best studios like Warner Brothers and NBC Universal in Fox Disney, and then you got YouTube creators and then everyone in between. They all have a different need
and structural requirements for them to continue to succeed. You know, I look at fast as the opportunity to bring content to millions and millions of people that many that you weren't able to do before right outside of YouTube. You know, now you can take it just wasn't feasible.
It was the economic model just wasn't there to even put it on Just the cost of putting it on TV would have been prohibitive.
Yeah, and you had, you know, cable networks, broadcasters that made decisions on what kind of content would be up on the screen at eight PM on a Tuesday, right, and that was that was finite. It was one second. It's one hour of time during the day, during the week, during the month, during the year, and when that's gone,
it's gone. Now, all of a sudden, you can take content that users created, whether it's high production from a big studio or it's a high quality you know, someone created great content in their garage and now you can put that anywhere. Right, you could target that content to the right user on your sixty five inch tea and sixty five inch TV. It emulates that same breath that users,
you know, associate with this television and quality television. We've we've launched brands that were you know, we just launched a channel called Haggardy Media. Right, it's a it's a car enthusiast channel. Right, They're an insurance company and now they've got they had tons of content for their fans and now we've turned that into a twenty four to
seven linear channel. It's exciting to see this happen, and we've it's countless We've seen lots of small creators build channels that have really done a great job and facilitating and bringing new content forward, and that's what I'm excited about. That's exciting for me to see new stuff that that's often lost in you know, billions of videos on the on the internet to something that's premium on television.
Is your phone just ringing off the hook from people that, boy, do I have a channel for you?
My team, my team's phones are ringing off the hook, they are, and everyone's building channels, and you know, I think that yes it is. You know, the channel environment is something that's important. But you look at video on demand as something that is really a way to look at content. That is, you know, where you don't need volumes and volumes of hours of content. As you know, being in from this business, a twenty four to seven
channel is hard to program. It's they're voracious, right. You have to continue to acquire a new content feed that monster, and it's hard to do. You know, we can now bring a video on demand experience, you know, forward, curate that to the user and all of a sudden, now use linear expose video video on demand content and then drive that back. So we create this flywheel effect and.
The user decides when that twenty four hour or whatever whatever amount of time they want to spend that the user decides when they're two hours with whatever channel starts.
We're so focused on the user, and I think what's really important is whatever we're whatever we're doing, it's how do we super serve the user? How do how do we provide the best content that they may not have seen to, you know, to that audience. In the business, we talk about this a lot, and we've been saying this, you know since the early days. When I was at Discovery. We got one point zero rating on a Sunday night and we were extatic it was amazing. And that's one
percent of the US households watch that content. And today we can now take that same piece of content and expose it to the ninety nine percent of people that have never seen it. And now, all of a sudden, the content economics change. Right before, it was the volume game where you had to continue to produce content reaching that one percent. Now, how do we take content that's been created that has amazing, that take amazing IP and deliver it to those other ninety nine percent that have
not yet seen it. That I think is what makes this business really interesting.
Don't change the channel. We'll be right back after this break, and we're back with more from Samsung TV Plus's Takashi Nakano. Are you surprised at the number I mean, I've seen, you know, major brands on your channel lineup? Are you surprised that the number of major leagues showbiz brands that have come to you and said, oh boy, do we want to you know, do we want to work with you and package some of our content because they, you know, the biggest, have so much that sits on the show.
You know, I look back five years ago and to see the you know, the ground that our team has made up between then and now, it's shocking. It's it's it's amazing that and I wouldn't have thought that we would be at this point this fast.
Was it a hard sell at first? Did you have to like talk people through the concept?
Yeah? It was. It was you know, I think the MVPD world hadn't imploded yet, right, it was starting to. It was starting to quake, a little landslide. Starting was just just early days. And yeah, no people, we most of the answers were no, we're not interested, we don't believe in this, and that was fine, and it was
my team was persistent. They believed in what we were doing, and everyone focused on you know, hey, this is a new way to watch television, especially with the shifting of the landscape, and at that point, s VOD was becoming really the place to you know, to be and it's still for the for the most part. We you know, we love our s FOG partners at Samsung. We you know, they're all of our partners as well, so you know,
it's still a great place to watch premium content. But you can't avoid and can't ignore the value of a free, ad supported experience. It's it's it's one hundred year old experience that we've had in you know, broadcast TV in the US, and it's not going away, and we still believe in it.
From Samsung's perspective, do you use Does Samsung see content as a you know, growth area, a profit driver in the future, I know you have. You know, Samsung has far flung businesses in many different, many different pockets, but content is still relatively new.
Yeah, No, content is new, you know. I think that's that's the big question for us, like how deep do we get into this content game? Are there opportunities? You know, if you spoke to our team most of us believe that there is right, there is absolutely if we have information on what users are interested in watching, if we have the ability to tailor and craft, and if it makes economic sense to actually make and control and own that for the life of the asset and the life
of our business. Yeah, it may, it may actually make sense to do that, you know. And our unique proposition is twenty four plus countries and a few more later on this year. Right, So now, when you can take a global footprint, which most of our competitors can't, and you know, and we also can take not just a global television footprint, but a global mobile footprint, and you combine all that together. We have access to a lot of households and a lot of people, and a lot
of screens in pockets. How do you take that and how do you bring content to those experiences? I think that's what's exciting. So, yeah, I do see an opportunity for us to move into that space.
Are you able to customize your channel selection by country or region at all? We do.
Every country has you know, country managers that oversee the content requirements needs, you know, this decisions that it's managed at the country level. There's nuances and rights are very complicated, as you know, across territories.
I'm sure that's a full time job for a small, small army of people watching all around the world.
It's difficult. You know, there's languages, you know, there's languages, there's you know, dialects that we need to manage for close captions versus subtitles. So there's a lot of nuance around operating a global environment, especially both mobile and TV, and how do you expose the content in the right way. So yes, we you know, it is complicated and is challenging, but there is there's an opportunity in that that very few companies can you know, take advantage of and move
business forward. So what's exciting is we could with simplify it, but with a push of a button, you can launch content around the world. Really that's on a television on a mobile phone simultaneously. We've been talking about this in cable television forever and it's never been possible until today. So it's exciting.
It's it is the end of geographic borders of being the parameters of where a service could go initially and then the and then it was so much based on the export model of content and it and you know that when Netflix at Cees twenty sixteen was a pivotal year for the PayTV ecosystem because twenty Netflix at Cees twenty sixteen flipped the switch and went global and just blew our minds in terms of like, oh thinking and to see now you know, where you have like a
real you know, with the biggest of the big things like Game of Thrones and Stranger Things. You now literally have a market where you compete globally, yes, which is which is fascinating and obviously you all are in there.
Well, if you look at the content experience that's around the world, that's really what's exciting. There's so much content that this country hasn't seen from around the world. There's brilliant creators that are doing this every day, day in and day out around the world. And to be exposed to some of those things, you know, the you know, the fandom of Korean content has exploded, and not because
traditional television has brought to popularity. It's really the digital you know environment has really brought that and you know, we as a Korean company can appreciate what that is. But now to see it in mainstream is very exciting and what else is out there? And you know, our teams are focused on finding that the what else is out there because that's untapped and unminded.
I would imagine that the growth of your fast business has also helped build up your VOD business. Are you still pursuing that at all?
Absolutely? You know, we look at VOD as as core of our business. You know, the fast business is great, it's growing, It continues to grow week after week, month after month, year over year over year. The growth has been phenomenal, and that engagement does not it hasn't stopped. The VOD business is exciting to us because the content mix is very different. Right, People watch content in different ways, and there's certain types of content that's best situated for VOD.
There's great content that's best situated for linear. When we only had I Rewind twenty five years ago, we only had a linear experience. We all waited for, you know, game, the Game of Thrones or the Entourage to come in at Sunday nights at eight pm. And today that's not the model. Right. Netflix has broken that I want it when I want it, yeah, and they drop all thirteen
episodes at the same time. So these models are continuing to change, and so how do we then, you know, this world of primetime watching versus late night watching versus daytime that's all a lot of that's broken too, and VOD can fix that. It's what kind of content do you want to watch that you're going to invest your time into and consume and what is that content? And how does Samsung TV Plus deliver that experience to the user where they're at at that right appropriate time.
A lot of fast channels are broadly distributed. Are you at all interested in I know you have some exclusive deals. As I recall some of them, you'll have like an exclusive for a year or two and then it'll go wider. Is there value in exclusivity? To you?
There is value in exclusivity. It does create this idea that users can only find it in our environment. Is it is it critical and important for ultimately the user? Not yet, you know, I don't believe that that that that's there yet. Will it become something in the future? It may, right, and I think it depends on the content. But if there, if it's content that's being produced for hundreds of millions of dollars and making it exclusive on a single platform, for the life of it, for the
entire life of that asset likely doesn't make sense. How do you create, you know, how does that work for the content itself? And how does that work for the user? It doesn't. So if we're focused on the content, focus on the user, how do we expose that? You know, we don't necessarily think about exclusivity or non exclusive, but really what's best for the user and what's best for the content.
Let me ask you in terms of like marketing in a consumer speaking to consumers about the fact that there is this great value added you know package that when
you turn on your TV. How do you market that in a traditional kind of you know, consumer marketing or do you do you rely on like you know, people at people that are selling television sets at the at the electronics store to really you know, promote, hey, you buy this channel, you buy this set, and you're going to have all this other you know, scot free content that flows in as soon as you plug it in.
And part of the great the great thing of Samsung is that we know our core business is selling hardware, and to do that, they spend a lot of money in marketing, marketing the hardware, you know, consumer marketing, product and feature marketing ces. There's a lot of money spent on marketing hardware products, and we're the beneficiary of that. We draft off of a lot of that marketing that's being done at the hardware level, so we do rely
on hardware and the value proposition. Our marketing team has done a phenomenal job selling TV Plus to the user our users, and we see that by the engagement, right, the consumers are watching and consuming a lot of the content, are exciting when new shows and new channels are launched, and our marketing teams does a phenomenal job and leveraging that and making that available and known to our user base.
But we also need to be patient. Right, this is a service that's been around for five years, right, and we you know Amazon's been around for twenty five years. We forget that these things take a long time to incubate and grow to become part of the consumer zeitgeist. And how do we get there is a long term endeavor?
We see a long term secular shift in television consumption that comes down to the great content coming on our platform, a better user experience, ubiquity across devices, you know, being able to watch the content you want, where you want to watch it, and how you want to watch it, and the consumer ultimately knowing that, hey, there's an amazing service out there that is free, and this is the way we end up. This is the way we're going to be consuming content as our central hub, whether it's
on a mobile device or a television. That does take time. So when we look at our programming, we try to focus on users of all demographic of all ages, and how do we give them something that they can now anchor into. So this becomes habitual and it becomes instinctual as opposed to something that's conscious. Television for many people is unconscious.
There you go wake up in the morning and turn.
It on right and you open Netflix because that's what you do. And that took thirteen fourteen years for Netflix to become that. So we give ourselves time and we see the long term impacts and you know, the opportunity over multiple decades in this business. So that's what we're excited about.
You're also doing some creative things. I understand you're bringing some a new package of like vintage Conan O'Brien episodes to one of your existing channels. That is slightly repackaged.
Yeah. No, we're always looking to grow our linear channel channels that we're creating. We're always looking to add and augment and enhance the experience that we that we bring. Channels are like children. They're you know, you birth them, you take care of them, you grow them, and eventually one day they move off to have their own life to grow up. Right, But it doesn't happen overnight. We have to continue to feed them. We have to continue
to nurture them. We have to grow their grow their ecosystem as well, and make sure that these channels are are changing. And you know, when I first started in the business years ago, we were launching we launched a channel called animal Planet and it was a gentle bend Lastly and Flipper, and that's what we were selling the cable operators. But the vision of what it could be in the future is what it is today and that's
exciting to see. And it's no different, right, all of these channels, if you look at every single channel over the evolution of its multi decade, experience has changed, right, it's adapted to the to what's new, it's adapted to growth. Some didn't grow, some, you know, shrank, some went away, and that evolution is exciting to see and for us, we we own and operate and curate forty plus channels, we see what's going on in them. We try to take care of all of them as much as we can.
We try to make them look like channels and content experiences that users can come into and appreciate and enjoy. And then we add on to that, right bringing in new content. So yeah, you're going to see a whole host of new content coming into each of our channels, both you know, the linear channels and VOD over the next you know, twelve to twenty four months.
So you must have quite I mean, with forty owned and operated channels alone, plus all the other stuff that you're like, you must have quite a team working on the just the operation of it's tiny. You're all working twenty four.
Seven, they're working thirty six hours a day. I think it's really shocking to see the level of not just engagement, but what they're able to put together and what they what they bring to the table every day. It's it's mind boggling. Cable networks were built with a single cable network took a hundred and fifty people to operate. You know, a decade and a half ago. Today, my small team has launched forty channels. You know, the marketing team has
done a great job in marketing these forty channels. Like it's not a large team. And now you know, we're talking about efficiency and scale earlier. We're able to leverage technology and become more efficient and scale and launch more stuff, and we're excited to leverage that to other parts of our business.
And being part of Samsung, I'm sure does not hurt in that in that pursuit.
For sure, no engineering technology focus there. You know, we think about the future of what this experience is there. You know, our research labs are developing and building. We hear and see new ideas all the time and we're blown away. And that's that's exciting.
It's it is a big moment of invention and innovation for the business, that is for sure. Let's back up. I'm curious, Takashi. You worked for Discovery, you worked for Scripts, you worked for GSN, you worked for pop TV, which was a joint venture of lions Gate and CBS, so you've had quite a bit of exposure to all of this. How did what got you what first got you into the cable distribution business.
So I didn't know I wanted to do cable distribution. I didn't know I wanted to negotiate deals with the cable operators. That's what I did for sixteen seventeen years. And it was a great learning experience, you know. We it was a great time of the business, and it was it was exciting to see and at that evolved when you know, I joined in. I joined Discovery in nineteen ninety eight, and I look, you know, from that day and I look forward to where we are today,
and it's changed so much. Right, the highs and the lows, and the the challenges that our teams had and negotiating deals with big cable operators and as being at most of those were small networks, so we had to we were challenged.
Do you have any good John Malone stories for us?
Probably something, probably things I can't say on on on the record, but no, like the the John Malone I have so much respect for and what he's built and how he really came and saved you know, Discovery years and years ago in his relationship with John Hendrix, and just to see some of that. And I was on the tail end of it and then you know the the growth days. But we heard about the stories of the old days of cable, and I think about where
we are today. It's no different, right. There's there's struggle, there's growth, there's opportunity, but there's vision. There's visionaries in this business that are that see so much more than what we currently have today. And I think that's what's really the exciting part of what fast in the future of television is it's we're convinced it's not going away. TV consumption doesn't doesn't go away, right, It's going to change here in the future, but it's not going to go away.
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