Discovery CEO David Zaslav wants to quell a potentially big shareholder concern: that his pay TV networks company might become embroiled in costly bidding wars for sports rights as a result of its new investment in TF1‘s Eurosport. (That’s part of two major deals the company announced this morning.) This is Discovery’s first direct foray into the sports business. But the near-insane buying frenzies are characteristic of the U.S. market, which is “completely different,” he said in a conference call this morning. Eurosport focuses on regionally popular niche sports including tennis, cycling, skiing, skating, and curling. That’s “more manageable, much more predictable,” he says. “There isn’t one sport that they have to have….It doesn’t strive to be that big massive platform, which is consistent with what we do.” Discovery also is still feeling its way: It agreed to pay $221.6M for a 20% stake in Eurosport. It has an option to raise its holding to 51% in two years. If it does, then TF1 can require Discovery to buy the remaining 49% as well.
Might Discovery take Eurosport into the U.S.? “That’s not part of this deal,” he says — although his company and TF1 are “looking at opportunities in Asia.” Indeed, Zaslav says that “the attack on sports in the U.S. has been aggressive and pretty well played….I don’t see anything we bring to the table.” Eurosport is Europe’s top sports service, broadcast to 130M homes in 59 countries, and in 20 different languages. Discovery shares are virtually unchanged in early trading.
- Sports & Recreation