‘The most powerful woman in entertainment’, Anne Sweeney is the co-chair of Disney Media Networks and president of Disney/ABC Television Group, a role in which she has, since 2004, overseen the company’s entertainment properties in the US and around the world. She has responsibility for the ABC network as well as Disney’s cable channels. The seasoned media executive talked to TBI about the impact that the current downturn will have on the media sector and on Disney in particular.
TBI: In broad terms, how does a recession impact on the media sector?
Clearly it’s something that we talk about not just on a daily but on an hourly basis. History tells us that electronic media records growth during a downturn. That was on TV – now it’s across several types of home devices.
TBI: So, consumption increases?
Yes, last year Nielsen issued a report that showed that the average American watches approximately 150 hours of TV a month and people watching video on the Internet watch three hours on top of that.
TBI: What is the impact on advertising?
On the advertising side we’re seeing companies are being forced to be very, very strategic. We see it, at its heart, as a demand for quality; advertisers want a specific audience and a strong brand. That’s why Disney and ABC have been so successful.
TBI: What’s your reading of the TV advertising market in the US?
I think that advertisers are looking for a better return on investment and they are looking to us and [customer relationship management] to provide specific opportunities to take their product to market.
TBI: Is it possible to actually grow the business through a downturn or do you have to hunker down and hope to weather the storm?
I believe you can grow the business if you start by doing a deep dive into it. We need to work carefully with people we sell to here and outside of the US. One example would be the time it takes to get an episode of Lost to markets outside the US. It used to take something like four months to get an episode to the UK and now we do it within days.
TBI: Because of piracy?
Yes, because of piracy and because we understand that that effects our partners.
TBI: Can any lessons be gleaned from previous downturns or does the current situation defy that sort of logic?
There are a few lessons that can be taken. First and foremost: avoid paralysis at all costs. This is a very severe downturn, but it’s very important that businesses are not frozen in their tracks. They have to accept challenges and remain very aware of what’s going on with consumers.
TBI: How does Disney differentiate itself in that scenario?
A focus on high quality and the brand distinguish us in a downturn, but we’re always focused on strong storytelling, high production values and quality of writing and talent.
What does help is to look at new, creative, business models like the ones we’ve employed with local versions of Desperate Housewives and now Grey’s Anatomy and Brothers and Sisters.
TBI: You talk about quality, but that comes at a cost. Can you maintain the level of investment in programming through a downturn?
We’re always looking at more efficient ways of producing and we were doing that before the downturn. That means a smarter use of budgets for pilots and a focus on the needs of the marketplace, on the ideas that we haven’t seen out there. There was nothing like Lost or Desperate Housewives when they debuted on network TV.
TBI: Lost is coming to an end and Desperate Housewives is a mature series, do you feel a lot of pressure to find replacements of equal stature?
It’s certainly top of mind. With us, the creative team is always trying to raise the bar; they take that upon themselves.
TBI: Is the current network pilot system sustainable?
We feel that pilots are critical research and development. We think it’s foolhardy to go straight to series before figuring out all of the challenges in the creative, the issues with the characters, stories, and the type of technology we should or should not employ to support the series.
There is no standard pilot layout: we have the flexibility to produce a pilot as a presentation or we can produce something longer. It depends upon what the creative is. For example in the pilot for Lost Jack (Matthew Fox) actually dies, but we saw that and asked ‘where does the story go?’ So we changed it.
TBI: What new shows are exciting you?
We’re just in pilot season now, but on the cable side I am very excited by the new Jonas Brothers series [J.O.N.A.S.], I think that will be a unique franchise.
TBI: On the cable side you are launching a new boy-skewed channel, Disney XD. Has the economic crisis impacted the way that brand will be rolled out?
We have certainly made adjustments to reflect the economy that we are in, but it is such a good opportunity for the Disney brand. Rich Ross [President, Disney Channels Worldwide] and his team have identified a real gap in the marketplace.
TBI: Program budgets have risen on cable and several of the big international hit series have emanated from cable, not network TV in recent times. Is the balance of power between cable and network TV changing?
I oversee both and have seen higher quality and slightly more programming [from the cable side] than in the past, but the bulk of programming still comes from the network. They are different businesses; cable has the dual revenue stream. That’s one reason we have diversified on the ABC side.
TBI: You have made some staff cutbacks. Is that process now done or could there be more to come?
You always have to evaluate the situation on a very regular basis as the business and market evolves. You need to be flexible regarding the resources you have. In some ways a downturn can stimulate resourcefulness. You see people working smarter and deploying resources more effectively as there is so much focus on the cost side of the business.
TBI: You are clearly keen to take advantage of digital opportunities. Earlier this year you rolled digital production arm Stage 9 into ABC.com. What message does that send out about original digital production?
I think we have streamlined the structure; we also combined ABC Studios and ABC Entertainment. With Stage 9, we created a short-form programming unit for advertisers and having done that we felt it was time to pull that together under one roof. It’s about super-serving advertisers.
TBI: How will Disney’s business look different when we emerge from this recession?
I think it will look different, but I don’t know in exactly what ways. We’ve already embraced so much change with the emergence of digital. We were the first on iTunes, the first to stream programming – so we had already, and fortunately, started to change. We had to because viewers are changing and accessing content in different ways.
TBI: Will international provide a greater proportion of revenues in the future?
If we continue to diversify internationally with coproduction, the volume of episodes we can provide, and the quality of our content, then we should see positive results.