March 08, 2004

Nine Questions With David Levy: Will Turner Still Play in the Big Leagues?

By Mavis Scanlon

David Levy, president of Turner Broadcasting Sales and president of Turner Sports, rarely has time these days to watch golf, his favorite sport. If he's not courting advertisers, such as AT&T, DaimlerChrysler and Samsung Electronics-which all signed up to sponsor CNN's 2004 election coverage-he is gearing up for sports rights negotiations. CableWORLD caught up with Levy a few weeks before he moved his memorabilia-filled office to the new Time Warner Center overlooking New York¹s Columbus Circle.

CW: Will Turner renew its contract with the NBA in 2008?

Levy: We have a great relationship and a great partnership. If things continue the way they're going and prices don't get into a situation where we can't afford to be, obviously we'd love to continue our relationship.

CW: How aggressive might Turner be in bidding for the NFL's broadcast rights when its current deals expire next year?

Levy: The NFL is certainly a property that fits into what Turner looks for when going after acquisitions in the sports market. I look to make sure it works for our marketers, our cable operators and our viewers. And the NFL fits right into those three criteria.

CW: Are networks such as NBA TV and NFL Network the exception, or will they become the rule?

Levy: They are here to stay (Time Warner owns 11% of NBA TV). It was smart for the NFL to start its own network. I believe Major League Baseball will as well. And there is already an NHL network, I think, in Canada, and they are considering bringing that down here. If they continue to grow and increase distribution, the question becomes what product goes on their networks and what product comes on ours, and that will be

CW: It seems there is a revolution brewing among marketers and big advertisers against the TV upfront advertising market. Is the model broken?

Levy: The upfront model isn't broken. NBC is looking to start its programming earlier; Fox has done it in the past. People are looking at this as an entertainment marketplace rather than taking off for the summer. Cable is a big reason for that.

CW: What's different for Turner going into this year's cable upfront market?

Levy: The sports marketplace does not go at the same time as the entertainment marketplace, which actually helps me live a normal life. Last year TBS and TNT went simultaneously with the broadcast upfronts. And that was the first sign that this is becoming a more one-television market-advertisers don't have to buy broadcast and then cable. We did high double-digit increases in revenue, and double-digit increases in CPM. The broadcast networks did very well as well. But what you saw over the fourth quarter and early first was a lot of cancellations of new shows, demographics leaving, ratings down further than they have been in quite some time. Yet advertisers just paid enormous price increases.

CW: So will this be the year that the gap between broadcast and cable CPMs narrows?

Levy: It started last year, and it will continue. It's an evolution. The major gap right now is prime time and the entertainment channels, and that's starting to close as well.

CW: Will it close all the way?

Levy: No, but major steps will be taken this year. When you say I'm only going to buy broadcast or I'm only going to buy cable, that's when we don't think you're getting the right mix. If you're going to buy a mix, let's put it all on the same playing field, and if we lose and they win, great. I'm not saying not to buy broadcast, I'm saying buy less.

CW: What's on your PVR?

Levy: I have a TiVo. I honestly do not use it as much as I hear other people use it, but I'm a sports and golf fanatic. Sex and the City and Curb Your Enthusiasm are the other two shows that my PVR is locked on.

CW: Do you skip the commercials when you are watching sports?

Levy: Do not.