By Erin Qiu, Ryan Wagner

[1] Discovery Communications logo

DISCOVERY COMMUNICATIONS, INC.

One Discovery Place

Silver Spring, MD 20910

240-662-2000

OVERVIEW

John Hendrick found Discovery Communications, Inc. (DCI), a global mass media and entertainment company based in Maryland, in 1985 [2]. The company first started with a single channel, The Discovery Channel, and later offered non-fiction programming through its network entertainment brands including The Learning Channel (TLC), Animal Planet, Science and Turbo/Velocity, Discovery Education, Investigation Discovery, OWN:Oprah Winfrey Network, and Eurosport. The company’s programs can be mainly separated into three types: Nonfiction, Sports, and Kids. DCI explores science fields, inspiring and entertaining people with its content. It also produces educational programs and services to schools. DCI in global entertainment reaches 3 billion cumulative subscribers in more than 220 countries and territories [3].

                 
   [4] TLC         [5] Animal Planet [6]Science Channel  (7)Turbo         (8)Velocity    (9)Discovery Education (10)Investigation Discovery (11)OWN:Oprah Winfrey Network (12)Eurosport

KEY EXECUTIVES

Discovery Communications is made up of an executive board that oversees all functions of the company [13]. The President and Chief Executive Officer, David M. Zaslav, also acts as Director and member of the Executive Committee and the President and CEO of Discovery Communications Holdings LLC. Zaslay makes a salary of $10,610,000, while Andrew Warren, the Senior Executive Vice President and Chief Financial Officer makes about $2,530,000 [14].

FINANCIAL INFORMATION

Discovery Communications is a publicly traded company on the New York Stock Exchange in Series A under the ticket name DISCA. On November 29, 2016, the closing price per share was $27.65. Over the previous 52 weeks, Discovery Communications has marked its highest sale price at $31.39 and its lowest sale price at $23.66 [15]. Over the past two years, DCI has noticed a decline in stock. While this drop in stock price occurred back in 2014, the company has since seen stabilization.

Much of Discovery Communication’s revenues are made possible through distribution fees charged for their services. Additional revenues are generated through consumer advertising, with national options for purchasing ad slots either upfront or in scatter markets. In fact, in 2015, distribution made up 48% of their revenue, while advertising made up 47%, leaving 5% due to other revenue [17].

In their 2016 third quarterly report, Discovery Communications identifies a 22% decrease in net income since last year’s third quarter, dropping funds from $279,000,000 to $219,000,000. Due to currency changes, DCI’s International Networks saw a decrease of 16% which was not offset by the domestic increase in network of 3%, unfortunately.

  INDUSTRY

Since its foundation in 1985 as a simple channel, DCI gradually expanded itself and established its New World Headquarters in Maryland in 2003 [18]. During these years, DCI added a second network by acquiring The Learning Channel (TLC) from Financial News Network Inc. (FNN) [19]. It also launched network’s website (Discover.com), and created channels for Animal Planet, Discovery Science, Discovery News, and partnered with Global Education to launch the Nonprofit Discovery Channel. With all these achievements, DCI became the World’s Most Widely Distributed Television Brand in 2001. After 2003, DCI continued launching networks including Discovery Education in 2004, its first First-Free-to-Air Channel in 2006, and Investigation Discovery in 2008, and teamed up with Oprah for OWN: Oprah Winfrey Network in 2011 [20]. In 2008, the owners of Discovery Communications, Advance/Newhouse and Discovery Holding combined their stakes and began trading as a public company on the NASDAQ stock exchange [21]. As DCI built partnerships and made investments in the U.S., it also paved the way to international partnerships and investments as well.

INTERNATIONAL PARTNERSHIPS AND INVESTMENTS

DCI has established its mighty international networks throughout the years since 1989 when it launched the Discovery Channel in the United Kingdom and Scandinavia [22]. Discovery Networks International includes five regional operations and covers all major cable and satellite markets, which includes the Asia-Pacific region, Central and Eastern Europe, the Middle East and Africa, Latin America/U.S. (Hispanic), Northern Europe, and Southern Europe. In each of these regions, DCI distributes an average of 10 channels in every market. Discovery Networks International not only offers customized schedules, but also programs in 45 languages worldwide via 352 distribution feeds [23]. Between 2014 and 2016, DCI has announced partnerships with several companies. In 2014, DCI launched the digital studio New Form with Brian Grazer and Ron Howard [24], and the same year, it acquired All3Media with Liberty Global [25]. In 2015, Liberty Global and Discovery Communications made a joint investment in Lionsgate and acquired stake in the company [26].

CURRENT PROJECTS

In August 2016, DCI and Liberty Global renewed their distribution agreement, a long-term deal that allows DCI to distribute its programs across 12 countries, including Austria, Belgium, the Czech Republic, Germany, Hungary, Ireland, Poland, Romania, Netherlands, Slovakia, Switzerland and the UK in Europe. The agreement also encompasses digital rights which enable viewers to watch programs anywhere [27].

Eurosport has also obtained the rights to distribute all matches of the Wimbledon tennis tournament live in an additional 16 countries for the next three years, 2017 to 2019, by extending the deal with The All England Club. The deal includes both TV and digital rights. A new deal has also been agreed upon that allows Eurosport to present all four Grand Slams: Wimbledon, the Australian Open, Roland-Garros, and the US Open [28].

In October 2016, DCI announced a partnership with World Wildlife Fund (WWF) that conserves an almost one million acres of land for tigers in India and Bhutan. The project, Project C.A.T. (Conservation Acres for Tigers), tries to protect and increase the wild tiger population, and allows rangers to better observe wild tigers’ health and collect data. DCI would also produce and distribute public service announcements and in-program content that bound with Project C.A.T., in the purpose of raising public awareness. DCI is planning to air a new documentary about tigers on its global networks in 2018 [29].

[30] Project C.A.T.

FUTURE PROJECTS

In 2005, DCI gained the rights to distribute the four Oympic Games in the 2018-2024 period in Europe on all TV and all platforms, including free-to-air television, subscription/pay-TV television, internet and mobile phone in all languages across 50 countries and territories on the European continent [31]. However, DCI has to agree upon on the requirements by The International Olympic Committee (ICO) and local market to broadcast a minimum of 200 hours of the Olympic Games and 100 hours of the winter Games of free-on-air television during the Games period [32].

        
 [33][34]International Olympic Committee Awards All TV and Multiplatform 
Broadcast Rights in Europe to Discovery and Eurosport for 2018-2024 
Olympic Games

DCI made a $100 million investment and entered into a strategic partnership witn Group Nine Media. The Group Nine Media Company is a new media holding company, consisting of Thrillist Media Group, NowThis Media, The Dodo, and Discovery’s digital network Seeker. The goal is to create one of the world’s largest digital-first content companies. The brand, Media Nine Group, not only allows each individual companies to remain independent but also enables the companies to support one another. The content studio and Thrillist’s sales team, The Colab will combine with NowThis Studios, The Dodo, and Seeker’s combined content team to create a major advertising solutions group across all the new brands. The company will also combine technology capabilities to create a publishing platform to power all brands. A new video department will be generated that will be responsible for creating OTT/on-demand and linear TV programming across all properties [35].

SOURCES

[1] Discovery Communications Logo. Google Images. Retrieved: November 29^th 2016.

[2] Our History. Discovery Communications. Retrieved: November 29^th 2016.

[3] Investor Relations. Discovery Communications. Retrieved: November 29^th 2016.

[4] TLC Logo. Google Images. Retrieved: November 29^th 2016.

[5] Animal Planet Logo. Google Images. Retrieved: November 29^th 2016.

[6] Science Channel Logo. Google Images. Retrieved: November 29^th 2016.

[7] Turbo Logo. Google Images. Retrieved: November 29^th 2016.

[8] Velocity Logo. Google Images. Retrieved: November 29^th 2016.

[9] Discovery Education Logo. Google Images. Retrieved: November 29^th 2016.

[10] Investigation Discovery Logo. Google Images. Retrieved: November 29^th 2016.

[11] OWN:Oprah Winfery Network Logo. Google Images. Retrieved: November 29^th 2016.

[12] Eurosport Logo. Google Images. Retrieved: November 29^th 2016.

[13] Leadership. Discovery Communications. Retrieved: November 29^th 2016.

[14] Key Executives. Yahoo Finance. Retrieved: November 29^th 2016.

[15] Summary. Yahoo Finance. Retrieved: November 29^th 2016.

[16] 2 Year Overview of Stock Price for DSCA. Yahoo Finance. Retrieved: November 29^th 2016.

[17] 2015 Annual Report. Discovery Communications. Retrieved: November 29^th 2016.

[18] Our History. Discovery Communications. Retrieved: November 29^th 2016.

[19] Associated Press (April 2^nd 1991). THE MEDIA BUSINESS; Discovery to Buy a Channel. The New York Times. Retrieved: November 29^th 2016.

[20] Our History. Discovery Communications. Retrieved: November 29^th 2016.

[21] Discovery to combine stakes in Discovery Communications with Advance/Newhouse (December 13^th 2007). CNNMoney. Retrieved: November 29^th 2016.

[22] Our History. Discovery Communications. Retrieved: November 29^th 2016.

[23] Businesses & Brands. Discovery Communications. Retrieved: November 29^th 2016.

[24] Jarvey, Natalie (April 2^nd 2014). Brain Grazer, Ron Howard Launch ‘New Form’ Digital Studio With Discovery. The Hollywood Reporter. Retrieved: November 29^th 2016.

[25] Newsroom. Discovery Communications. Retrieved: November 29^th 2016.

[26] James, Meg and Faughnder, Ryan (November 10^th 2015). Lionsgate sells 6.8% stake to John Malone’s Liberty Global and Discovery. Los Angeles Times. Retrieved: November 29^th 2016.

[27] Briel, Robert (August 2^nd 2016). Liberty Global and Discovery sign 12-market carriage deal. Broadband YV News. Retrieved: November 29^th 2016.

[28] Dickens, Andrew (March 8^th 2016). Eurosport serves Wimbledon further. C21Media. Retrieved: November 29^th 2016.

[29] Paul, Jonathan (October 19^th 2016). Discovery, WWF partner for Project C.A.T. Realscreen. Retrieved: November 29^th 2016.

[30] Project C.A.T. Logo. Google Images. Retrieved: November 29^th 2016.

[31] Press Release (June 29^th 2015). IOC AWAEDS ALL TV AND MULTIPLATFORM BROADCAST RIGHTS IN EUROPE TO DISCOVERY AND EUROSPORT FOR 2018-2024 OLYMPIC GAMES. Olympics. Retrieved: November 29^th 2016.

[32] BBC and Discovery Communications sign long-term Olympics Games partnership (February 2^nd 2016). BBC. Retrieved: November 29^th 2016.

[33] International Olympic committee Awards All TV and Multiplatform Broadcast Rights in Europe to Discovery and Eurosport for 2018-2024 Olympic Games. Google Images. Retrieved: November 29^th 2016.

[34] International Olympic committee Awards All TV and Multiplatform Broadcast Rights in Europe to Discovery and Eurosport for 2018-2024 Olympic Games. Google Images. Retrieved: November 29^th 2016.

[35] Newsroom. Discovery Communications. Retrieved: November 29^th 2016.