Discovery Boss Isn’t Afraid of Skinny Bundles, But Prefers OTT

David Zaslav doesn’t really think either alternative to traditional cable TV delivery is going to “meaningfully” happen in the U.S. any time soon

It’s going to be years before “skinny” cable bundles become a realistic option in the United States, Discovery boss David Zaslav said — but he’s not afraid of the idea anyway. Zaslav told media analysts Thursday that he likes how his “very efficient” channel lineup stacks up against the rest of the industry.

“If it ever did happen here in the U.S., we would be well-positioned,” Zaslav promised on a company conference call Thursday, adding, “I don’t believe it’s going to.”

Zaslav would much prefer over-the-top delivery of film and TV content via the Internet, without requiring users to subscribe to a traditional cable or satellite service. “I’d like over-the-top to happen in a meaningful way … but I think it’s going to be a while,” he said a little later.

After all, Zaslav’s company loves streaming things, even if that’s currently not a profitable part of it business. He said the targets are set up correctly for a future money grab, though, as Discovery is going hard at millennials.

“We’re not leaving the youngest demo out with our streaming business,” Zaslav explained. “We’re not making money on that business today, but we’re not losing money.”

Discovery has 350 million streams — and growing — the Discovery Communications president and CEO said. And Zaslav believes his company is (again) better positioned cost-wise than anyone else — after all, Discovery owns its own content.

“Candidly, we haven’t done a great job monetizing those streams,” he admitted of the company’s strategy to date. “Now we have a whole team that is attacking the ability to engage with millennials and make money on those streams.”

Check back for some real net income from that segment in 2016 and 2017, Zaslav said.

Over-the-top would allow a content provider to stream video directly to a subscriber via the Internet, whereas a skinny bundle could reduce Discovery’s channel offerings from 14 to about eight.

Discovery Communications unveiled disappointing fourth-quarter 2015 earnings early Thursday morning, missing Wall Street’s marks at both the top and bottom lines.

It was international declines that offset domestic growth, something company brass attributed to unfavorable foreign currency exchange rates.

On the bright side, some of those markets “can’t get any worse,” one Discovery executive opined on the conference call.

So, that’s all good news going forward, we guess.