CRITICS OF CNN PRIMA NEWS SHOULD STEP OUT OF THEIR SOCIAL BUBBLE FROM TIME TO TIME, SAYS THE GROUP’S CEO MAREK SINGER

Marek Singer has been the head of FTV Prima group since 2008. But only after fourteen long years can he be happy that Prima’s channels are catching up with their biggest competitor - the Nova group - in terms of viewership. In certain viewer target groups, they even surpassed Nova in March. 

“What seemed impossible years ago is now a reality,” says Marek Singer, the apparently satisfied Prima Group’s CEO in a large interview for Forbes.

The seasoned manager cites viewership of CNN Prima News, the news channel that will celebrate two years on the market on 3 May, as one of the highlights of the recent achievements in addition to the new channels Prima Show and Star. However, CNN Prima News critics often compare it to misinformation channels.

Prima’s head counters the criticism, telling them that “It is good to peek out from one’s social bubble from time to time. If we stop comparing ourselves to the opinions of others, it is the first step to fundamentalism. Ant that would be a big problem to our liberal democracy in my opinion.”

The fifty-four-year-old seasoned manager isn’t just concerned with viewership that he wants to support with a new series Pálava in the autumn. He has negotiated with IPTV operators on the ban on ad-skipping in catch-up viewing or the establishment of a new platform AdCross, which measures the aggregated reach of TV and digital ads.

Your ratings have been growing; last year, you grew for the fourth year in a row in the 15+ target group to 25.18 percent and on an annual basis, you were closely behind the channels of Nova Group, which unlike you targets viewers aged 15-54. In Prima’s commercial group of viewers aged 15-69, you managed to defeat Nova in the fourth week of March...

For the fourteen years I have been sitting in this chair I have had a dream to catch up with Nova in ratings and the dream came true in March. In our target group of economically active people, we even managed to outperform it. What seemed to be impossible years ago that is now a reality.

And will you also be successful on an annual basis this year?

That remains to be seen, of course. But trends are clear, the two groups are converging. It is certainly a never-ending struggle, Nova is naturally not going to let it go. Several years ago, we were a clear number two in terms of viewership share but now we are equal competitors.

What was the main driver of viewership growth? Did Covid-19 make an impact?

Covid-19 has made an impact on the entire TV market. When people were staying at home, they were logically watching more and the pandemic was a topic they were interested in. The interest in TV was higher and streaming platforms were also not put aside.

Now, the viewership of live broadcasting is coming back to the pre-Covid level and we expect it to go on falling because people are using more and more various Czech and global video services allowing them to watch shows whenever they want.

And in this situation, we managed to close the gap on competition through the combination of improved programming, new channels such as Prima Show and Star and the high-quality programme mix. And what also played its role was the viewership of CNN Prima News which has grown in this current crisis time. The combination of all of these factors has made up the desired effect.

The rating of CNN Prima News is above two percent after nearly two years from its launch. Is that a good result for news TV?

The share of 2.4 percent in March in TG 15+ is a good result, the breaking point in terms of profitability is 1.5 percent rating combined with the web’s contribution. It is a standard evolution of news TV, it is growing most in a crisis. The news TV channel ČT24 has the same experience, it was rising with every crisis.

In general we can say that an increased rating during a crisis will not fall to a pre-crisis level after it is over but settles somewhat higher. When the conflict in Ukraine ends, CNN Prima News will be a little higher than before in terms of viewership. And I believe that the development will go on in this direction.

So now CNN Prima News will earn its keep?

Yes, it will. Operating news TV costs hundreds of millions of crowns a year but at the current ratings combined with our website readership it is already earning its keep. We are in the black at zero in the model at 1.5 percent viewership as I have mentioned.

But we are not doing a news platform to generate a high profit. Watching news has a positive effect on viewer loyalty to the entire group of channels.

How does your cooperation with CNN in the US work? Are you in a daily contact?

The cooperation works on the basis of a standard relationship between a licensor and a licensee. There is an editorial board meeting approximately once in three months, assessing progress and recommending what we could improve. But it is not a daily contact, although they monitor our work very carefully.

When we managed to respond to the current war conflict faster than our competitors, we received a commendation immediately. They are aware in CNN that if you succeed in responding so quickly, the positive effect is felt in the following period. We were very pleased by the commendation. After all, CNN has grown up on such situations...

Do you have other objectives relating to the viewership of the news channel?

It can always be better and we definitely want to go further. But we have to be realistic. If we achieve forty or fifty percent of the viewership of ČT24, we will have achieved the first objective we have defined. If it gets better, we will not be angry at all.

Do you also perceive negative reactions to CNN Prima News? Your critics often compare you with the misinformation scene…

… which is very amusing and sad at the same time. We always want to provide all facts and views of all relevant parties. Of course, all editorial team is affected by the criticism because it is not pleasant to be accused as such.

But I always remember the time when we started CNN Prima News and I asked people from CNN who helped us set up everything how we would know that we were doing the news channel right. And their answer was: when “everyone would curse you”. When nobody is talking about you, you are either boring or not getting to the heart of the matter.

When some users of a social network criticise us that we favour one of the parties to the dispute and users of another network think that we are siding with the other party, it is good. It means that opinions of multiple parties were expressed. That is right because individual social bubbles prefer their views. And they point out to a single issue that they do not like out of the wide range of views we cover and they label us for that.

What would you say to your critics?

I would urge them to peak out of their social bubble, it is a good thing to do from time to time. If we stop comparing ourselves with the views of other people, it is the first step to the fundamentalism. And that would be a great problem for our liberal democracy in my opinion.

Of course, in the period of an aggressive war conflict, there is just one party that is in the right. But what is the solution? What are the consequences of the conflict, what would that mean for our economy - that is not black and white. There are always several ways to face the situation.  And people should know all options. It is all about plurality of views. That is the core of the freedom of speech.

Let us turn to the business policy. What resonated with the public space at the beginning of the year was your requirement to ban ad-skipping in time-shifted viewing on IPTV. You had a dispute with O2 TV and there was a threat that your programmes will be removed from its offering. In the end, the matter was postponed to 1 June. What is going on now?

We are finalising technical conditions with all operators because at this stage, it is mainly a technological challenge. There is no single standard, each operator has its own video platform.

We are intensively working on fine-tuning of manuals and possible scenarios for four alternatives of how exactly we want the ban on ad skipping to be implemented. But it is not just all about us not wanting people to skip ads in time-shifted viewing.

What exactly do you want then?

There is a clear view of “Television 2.0” which is based on a foreign model. Our current local standard that on various video services you press a button to skip an ad is annoying in general. You cannot find the precise start of a show etc.

Yes, viewers will have to watch about a half of advertisements (about three minutes) compared to live broadcasting because we have to pay for the content we have produced. The growing popularity of ad skipping starts to be a crucial problem and we cannot ignore it.

Now we are in a period when both operators and we have a lot of work to get ready for the transition on 1 June.

And have you reached an agreement with all of them? Including O2 TV?

Yes, we have reached an agreement. We are no longer discussing whether it happens but how to do it.

You provided operators with four alternatives containing, for example, a certain compulsory block of advertisements of various lengths that cannot be skipped or an option that operators can “buy themselves out” and pay you for keeping ads off their platforms... 

We have provided these alternatives because we are aware that any individual platform has its own degree of flexibility to make changes in the system.

Nobody wishes to make viewers angry. Our aim is to ensure that we will receive at least a minimum level of income while giving operators a chance to make their users understand when they can watch something and when they can skip something.

The rewinding and fast-forwarding of content has got the green light, it has been a standard for us.

The problem is that people skip all ads while rewinding and fast-forwarding content. And they might not be aware that we receive no money for having ads set up in shows, we get money when the ads are watched.

But operators argue that they are paying you for content.

I understand that. But if you compare how much they pay us for the option of time-shifted viewing compared to what is usual across Europe, it is relatively ridiculous. And that is the problem. Operators’ fees did not reflect the premium rights.

Moreover, foreign pay platforms used the obligation to pay for such rights to broadcasters and created premium packages of their services. They are offering ad-supported content and an ad-free package and the differences cost several Euros. This did not happen here due to competition or other reasons. And as a result the current discomfort is higher.

We also want to give our viewers a chance to watch our content without ads or with a limited number of them and we are looking for a fair business model with operators.

In the terrestrial broadcasting it is the other way around. You are paying to operators to get your content to viewers.

The Czech terrestrial broadcasting is a complete anomaly. I think that a terrestrial broadcasting operator will gradually transform into a certain hybrid form with IPTV as this is the future. It will take years but it will happen. The fact that a certain portion of population has TV for free is an anomaly that will gradually disappear.

Is terrestrial broadcasting heading for a fee?

I think so. But this is rather a question for České Radiokomunikace. I assume that they will come up with such a business model one day. People will not content themselves with live broadcasting only, i.e. linear TV, they will want additional services. And if you want to provide them, the terrestrial model is not sufficient.

Is all this we are talking about the reason for creating the new platform AdCross for measuring total ad video, i.e. monitoring the aggregate reach of ads not only on TV but also in the digital environment?

Yes, it is, to some extent. There will be fewer and fewer people in linear TV as is the case abroad because we are copying foreign trends with some delay in the Czech Republic. People abroad watch TV content more and more when they want, i.e. via various services, and less and less via linear broadcasting.

To keep the quality of our content, we also need to receive money for advertising in non-linear, non-live broadcasting. We are at the cutting edge of development in Europe in this effort. For example, in the UK, cross-media measurement has just started.

And how do other players in the market view AdCross?

Our business partners’ reactions are positive. They are aware that there is no other way going forward. We are at the beginning, operating in a pilot mode.

Everything has been going on since the start of the year, we have been selling some campaigns this way but the volume is still small. There are still more technological developments to come, we need to set up everything with all operators. With them, we are now dealing more with easing the restrictions on ad skipping.

So when will it be on your agenda?

This year. Cross-media measuring will become a standard.

Should not this be a job for the Association of Television Organizations (ATO)?

In theory, yes, it should. On the other hand, ATO has members for whom advertising is the key source of income as well as members for whom it is not so because specifically Česká televize does not live on advertising and so it is not its priority. But Česká televize is engaged in the project as it wants to use the cross-media measurement for measuring the total impact of its show promotion.

At this moment, we are negotiating with another large commercial broadcaster who is interested in cross-media measurement. That is why I think that this year, AdCross measuring will become a standard for all large TV networks.

What is the current development of ad prices in respect of what is going on? There are quite a lot of things occurring...

Exactly, there is an awful lot going on. From our point of view, the good news is that the volume of TV advertising is still growing. We will see what the rising inflation will do with ad spends.

There are no signs of any advertising budget reduction, touch wood. Prices are based on annual negotiations and they took place before the last crisis.

The price slightly increased at the beginning of the year but we will see how everything will develop, especially in the second half of the year. For the time being, it looks as if there were no crisis. The question is for how long the crisis will continue, what the value of disposable income will be, and what impact it will have on consumption.

What were your financial results last year? The last figures disclosed for 2020 reported a profit exceeding half a billion crowns at sales of CZK 3.5 billion. Was it better last year?

We have yet to disclose our financial results but I can say that they were better than in 2020. But growth will be a bigger challenge this year. For all of us.

In terms of your own production, it was more difficult to shoot something during the Covid-19 period, especially due to lockdowns and other restrictions. Are you still catching up on what was missed during the forced break?

We were intensively catching up on everything last year, shooting a number of shows to have in stock. In general, the volume of TV content production is high in the Czech market now. Local broadcasters are shooting at a breakneck pace, not only due to increasing competition.

The reason is that all large players invest in video services, be it Voyo or iVysílání. We are also preparing a new iPrima. To get everything going we start shooting earlier. We are in a very intensive period for the original Czech production.

So what news can viewers look forward to on your channels this year?

At the beginning of the year, we launched a new series ZOO, which has ratings similar to the series Slunečná. We are very happy because following in a historical success is always very difficult. The series Duch ended up as the second most successful series of all time, with which we are also satisfied.

There will be big news especially in the autumn. But I cannot talk about many of the new items. What I can tell is that we are preparing a loose sequel of our successful series Vinaři that will be entitled Pálava. There will be old and new characters and new stories but the environment and atmosphere will be preserved. I think that this will be much appreciated by viewers. The worse the mood in society and the more challenging life is, the more people prefer this type of content.

As for your own content, there should be some created in the new e-sports centre PLAYzone Arena in Prague - Chodov in which you participate and which will open at the end of this month...

… the opening is on 25 April, so we are finishing everything. Some shows will be created there but first of all, it will be a great experience for visitors. Such big centres are, for example, in London, Berlin or Stockholm but in Central Europe, we have had nothing similar.

There will be more than sixty computers and e-sports competitions including Czech championships. In short, there will be much entertainment and it will be very attractive, especially for younger audiences.

And how does such a centre fit into the strategy of a large media house?

We entered Playzone several years ago because we can see that gaming is going up. It matched our strategy at the moment we had learnt from foreign surveys that more people prefer watching someone else playing a game to playing it themselves. At that moment, it is video entertainment and that is our core business. Video entertainment is what Prima is doing.

What is the potential of e-sports in your opinion?

It is a dynamically developing area and I do not think that the sector is in its infancy in the Czech Republic. Given the investments in e-sports teams and competitions, e-sports have moved to the adolescence stage. Especially for younger generations, e-sports are experience that is absolutely comparable with watching traditional sports. Which we in our fifties do not understand. (laugh)

Source: forbes.cz