Starz CEO Chris Albrecht is unmoved by the advent of skinny bundles — the low-cost, digitally distributed channel packages that have emerged to challenge traditional cable-television products.
“We’ve had no expectations because we really are not in charge of that,” Albrecht said Friday at the Television Critics Association press tour in Beverly Hills. How many resources MVPDs are investing in pushing skinny-bundle products — Albrecht cited AT&T’s DirecTV Now — is unclear to the premium channel chief. “It will continue to be a business that they invest in because they have to.”
The skinny bundles, he added, are marketed to customers who “are either downsizing or new customers,” Albrecht said. “I’m not sure that they have, and I know that we don’t have, a list of who’s who. I think that transition, certainly in the case of AT&T is certainly not offsetting them shutting down their U-verse platform. So each distributor has different challenges.”
Albrecht also said that mergers such as the recent acquisition of Time Warner Cable by Charter Communications, will continue to drive the entry of new products into the marketplace.
“There are different things that will impact it,” Albrecht said. “But the fact we’re longtime partners with these MVPDs, the fact that they’re finally realizing that they have to innovate to keep that customer relationship in the home, I think bodes well for the premium business that Starz has been in for decades.”
Starz last year launched its first direct-to-consumer app, allowing potential customers to circumvent MVPD distribution. But Albrecht said Friday that its offering as a premium cable channel is still the company’s primary business.
“Although there’s been some rocky news in the MVPD business, these are huge companies that have a lot invested in maintaining that customer relationship into the home, which they don’t get to do, by the way, through, Hulu, Netflix, Amazon,” he said.
He added, “We’re packaged in the premium space by the MVPDs with HBO and Showtime. Those are the people we look at as our core business. We’ve fared really well, but the OTT space is really the new frontier.”
In December, Lionsgate finalized a $4.4 billion deal to acquire Starz. The two companies had flirted with a possible merger for more than a year before a tentative deal was announced last June.
