The rivalry between Disney Channel and Nickelodeon has gone global. The powerhouse kids’ brands are aggressively extending their presence and penetration in both established and emerging international markets as they vie for global supremacy. And because the kids’ universe is a complex blend of micro-demos that include preschool, tweens and teens, both brands have enjoyed considerable success, depending on the market and the demo in question.
That’s not to say, however, that smaller, independent companies can’t also play. They just have to watch out for the big boys.
Rich Ross, prexy of Disney Channels Worldwide, says the company’s strength lies in the 6-14 demo. “That’s where we’re No. 1 in most markets, pulling away.” Disney Channel remains strong in Latin America and is No. 1 or 2 across most of Europe, Ross adds.
But the world is a checkerboard of market penetration. One company may dominate a territory but be weak in an adjacent one. Observes Ross: “We can be No. 1 in (a given) market but not have penetration in, say, Germany,” where the Disney Channel is broadcast on the Premiere cable/satellite service, “or we’ll be No. 2 to a local player, like in France.”
In general, he says, Disney’s “biggest competitor is not an international competitor; it’s local competitors.”
Ross adds the original plan in taking Disney Channel international was not to focus “on the penetration but on the strong business model. And what followed when Anne (Sweeney) took it to basic cable in the States was (the realization) that that had to happen everywhere. So increasing our distribution around the world matters. … If you have the right content, all of a sudden a lot of people are watching your programming. And that’s what’s happened in Europe.”
Integrating with local markets has been key to Disney’s wide-ranging international success. “We have a team of people locally who understand the Disney Channel and the brand but who have the freedom to buy local product that makes sense,” Ross explains. “That combination of having a strong global viewpoint and a local team is what has made this work for us thus far,” including markets in Asia and Latin America.
Is there a place Ross would like to see improvement? “The market I would like to do better in is India,” he says. “Otherwise I think we are quite strong everywhere, including Japan.”
Steve Grieder, sr. VP of the other global kidvid giant, Nickelodeon Intl., agrees that paying attention to the subtleties of local markets is vital, but he points out: “Hit are hits. So the biggest shows here are likely to be the biggest shows internationally. The fundamental philosophy of Nickelodeon (is that) you’ve got to talk to your audience and listen to what they want.”
That has proved particularly successful in India, where Nick launched in 2001 and languished. “We were No. 5 in the market, facing new international competitors who were spending millions on marketing to establish their brands. Then over the last two years we put a team together to determine what kind of brand we wanted to be in India. Today, we are the No. 1 kids’ channel in the country, even against really strong local, smart competition. We’ll see how we sustain that, but it speaks to what you can do with a content-rich brand if you pay attention to a market.”
Grieder adds that Nickelodeon has “spent the last three years No. 1 as a network in the U.K., but the place that is the most promising in terms of growth is Germany,” where Nick launched a 24-hour channel in September 2005. Nick has also launched on the Arabian peninsula and the Gulf states, with a pan-Arabic team in Dubai.
Despite the very large footprints left by Disney and Nickelodeon, smaller, independent companies have also found success in the international kids’ arena. Echo Bridge Entertainment executive VP Dan March, who licenses the teen drama franchise “Degrassi,” acknowledges, “The preschool properties, the 4-8 brand businesses, are dominated by the Nickelodeons and Disneys of the world; there is less demand and less windows for independents.” But the playing field levels out more in the older demographics, he adds, because “Disney does not have a corner on the teen market.”
March says that over the last couple of years, teen blocks have become more of a focus for international broadcasters as they have launched digital channels. As a result, “The teen market is probably the fastest-growing demo, giving independents more opportunity, and we’ve benefited from that with ‘Degrassi,'” which is seen in more than 50 markets and which, says March, “tackles subjects teens deal with on a day-to-day basis that nobody else really addresses, whether that’s abortion or gay relationships. … The family brands would never touch that subject matter, especially in the way ‘Degrassi’ does — nor should they.”
Kidvid purveyors can also ride on the leaders’ coattails. Jim Henson Co. prexy Peter Schube notes that the international success of Nickelodeon and Disney is good for his company because “they are strong partners for us. They have broadcast operations around the world that we look to put our content on, so the stronger their platforms, the better position the programs on that platform have.”
Still, Schube acknowledges his company also competes with Nick and Disney on the supplier side in that they produce children’s programming: “The Jim Henson brand is very strong around the world. We spend a lot of time and attention focusing on creativity and technical innovation, and we think that’s the hallmark that distinguishes our programming.”
Regardless of current successes, the kids’ international market will remain competitive, prompting Disney’s Ross to note, “We’re constantly trying to grow our penetration in any market we are in,” such as adopting a free-to-air model as was recently done in Spain, which allows Disney Channel to reach more viewers and drive advertising revenue. Irrespective of the distribution platform employed, “We need to continue making the right shows globally and locally, and aggressively market both the shows themselves and the channels. There is no status quo.”