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Original Programs Key to Zaslav’s NBC Cable

Oct 27, 2003  •  Post A Comment

T-shirted construction workers were still applying the finishing touches to the new NBC Cable Networks complex in Englewood Cliffs, N.J., on a recent workday as staffers were settling into new offices. Not surprisingly, NBC Cable President David Zaslav had already gotten down to business.
After GE and NBC complete the acquisition of the U.S. entertainment assets of Vivendi Universal, details of which cable players will operate out of Englewood Cliffs will be worked out. But one thing seems clear: Mr. Zaslav, 43, is likely to play a key role in NBC’s efforts to become a much bigger and more significant player in cable television.
In an interview with TelevisionWeek, Mr. Zaslav outlined a streamlined and powerful organization that has some unique concepts about how to win in cable in 2003 and beyond and which has learned a lot since NBC’s first tentative forays into cable in the 1980s.
It wasn’t always about the promise of cable. When Mr. Zaslav joined NBC in 1989, he recalled, there were bitter turf wars in which broadcast network executives at 30 Rockefeller Center, NBC headquarters in New York, saw the cable group as an interloper. “There were two cultures at NBC,” he recalled. “Everybody at 30 Rock said, `What the heck are you doing?’ Our separate programming divisions were fighting for money. But Bob’s vision was, if we need to play this [cable] game, we need to play it hard. Bob always felt that [cable] was critical. He pushed hard.”
“Bob” is Bob Wright, the vice chairman of GE and chairman of NBC. He oversees all of the broadcasting operations and was the engineer behind the acquisition of the Vivendi assets, which created the new NBC Universal, as the combined operation is to be called.
It was Mr. Wright who hired Mr. Zaslav. They met when Mr. Zaslav was toiling as a lawyer in Manhattan for LeBoeuf, Lamb, Lieby & MacRae, (now LeBoeuf, Lamb, Greene & MacRae) where he worked on cable affiliate issues. He sent a note to Mr. Wright, suggesting Mr. Zaslav might be helpful in NBC’s push into cable. Mr. Wright, who trained as a lawyer, brought in another lawyer, Tom Rogers, to start the fledgling NBC Cable unit. Mr. Wright hired Mr. Zaslav to help get NBC Cable established.
“David has done an unbelievable job in creating a relationship with the cable industry on behalf of NBC,” Mr. Rogers stated. “Cable operators are very receptive to what NBC can bring to the table now and in the future.”
“He’s a really smart guy,” said Anthea Disney, executive VP in charge of content at News Corp., who works on global cable deals and is on the board of National Geographic International along with Mr. Zaslav. “He’s a straight shooter.”
Mr. Zaslav would not address NBC’s specific plans for USA Network, the series “Law & Order” or other Vivendi properties, because the deal is still not final. However, to know what might happen, just look at the recent history of Bravo. NBC acquired the general entertainment and arts network from Rainbow nine months ago. At the time, according to Mr. Zaslav, it was a critically admired channel that had an older audience and was distributed to 68 million homes. Through heavy affiliate marketing, the penetration of the channel has been bumped up by almost 7 million, including 5 million analog homes.
Most important, NBC has invested in original programming, and that is what it will do over the next few years with its new acquisitions. “The real heritage of cable is the original content,” Mr. Zaslav said. “The signature show of a cable network should be an original show. Off-network programming is a good way to introduce audiences to a channel. But fundamentally, off-network is very expensive. As with sports channels, you can get too caught up in [expensive sports rights] battles.”
After the Vivendi deal closes, Mr. Zaslav is expected to retain oversight over distribution and marketing of the cable channels.
At least twice in the past decade, sources said, Mr. Zaslav has been pursued for top-level jobs at rival companies. “What would make you stay?” Mr. Wright is said to have asked Mr. Zaslav, according to a former NBC executive. Ultimately, Mr. Zaslav stayed put, partly out of loyalty to Mr. Wright and partly because he believes in the future of the place.
Mr. Zaslav prefers to focus on the future. He is a major believer in high definition and video-on-demand and has also embraced the drive into Spanish-language programming at the network. “We have always been aggressive in embracing new technology,” he noted. “We have been successful by being the leader in understanding all the new technologies. The business is changing; it is no longer a 30-channel situation. The audience has a ton of options. The bet on VOD is that the customer will pay for convenience. It allows people to pick and choose.”
NBC has invested heavily in the growing Hispanic market. “When we bought Telemundo, we recognized that it was a high-growth area,” Mr. Zaslav said. “It was a real chance for us to buy into the Hispanic marketplace.”
A new digital channel, mun2, now in 6 million homes, has been specifically created to target younger Hispanics who may have grown up speaking English. Mr. Zaslav called it a “Spanglish” cable channel, “which uses a lot of English.” NBC plans to experiment with the Hispanic audience by offering Latino telenovelas, or soap operas on VOD.
NBC’s track record in cable so far has been decidedly mixed. The company’s previous cable focus, news, resulted in two channels, CNBC and MSNBC, that trail behind the market leaders, Fox News Channel and CNN, in ratings and revenue. But the channels are solidly profitable and have achieved wide distribution through retransmission and NBC’s long-term Olympics contracts. MSNBC, Mr. Zaslav said, is “evolving.” As is NBC Cable in general.