CEO Club Briefing

Michael D. White

Chairman, President, and Chief Executive Officer, DirecTV

Michael D. White

Chairman, President, and Chief Executive Officer, DirecTV

Content Rights

Audience Member: How do you see the role of the pay TV distribution companies changing in a world where more networks are going over the top and they start launching their own standalone streaming services?

White: Well, you know, we’ve looked at the—we’re actually launching our own over-the-top Hispanic service called YaVeo later on this year. Make sure we get some learning—we took NFL Sunday Ticket this year and did a little bit of over top to get some learnings in both universities—a couple universities and apartments and cities. Clearly it’s going to change the industry.

The challenge of this is everyone kind of immediately assumes it’s a technology issue. And frankly, they miss the fact that actually it’s a content rights issue—and how you’re going to monetize that content. So today, between ad sales and affiliate fees that we all pay the media companies, you’re talking $140 billion a year. So the over-the-top guys would love to get a piece of that action.

Look, I don’t have any issue if someone wants to try a Netflix free-rider model on the Internet. I’ve looked at it as an option. I looked at acquiring Hulu. But I think the real question is going to be, if you start unbundling the content and you’re going to force me to carry these huge bundles that are, frankly, too big today—but that’s what I’m forced to take by the media companies—you know, then pretty quickly distributors are going to say I don’t need to carry that stuff.

So interestingly enough, I think it’ll have less to do with, Can I watch stuff on an iPad or on the PC? It’s going to actually come back to the content issue. And if you’re going to tie my hands and force me to take all these channels and then turn around and do it a la carte over here, I’m going to say, well, give it to me a la carte. I’ll be happy to price my service as plumbing and wiring, if you will—because the satellite’s an efficient system—and then separate price the content. But I can’t today.

So we’ll see. But I think you’ll see more of it, for sure. And Netflix has done a great job.