Upfronts 2010: Brisk Sell for Weather Channel
CEO Kelly combines TV, online units; will re-launch Website
By Claire Atkinson -- Broadcasting & Cable, 4/12/2010 12:01:00 AMUpfront Central: Complete Coverage from B&C
In the past eight months, The Weather Channel President- CEO Michael J. Kelly has been breaking down silos between the NBC Universalbacked network's businesses. He is also on a mission to extol the multimedia brand as the upfront pie gets divided, he tells B&C in his first in-depth interview since taking on the role in August 2009.
Formerly president of AOL Media and chief marketing executive at Time Warner, Kelly plans to evangelize Weather Channel's new directions during general ongoing meetings with agencies, rather than at a dedicated upfront event.
Kelly, who was hired with a charge to reorganize the media property and put it on solid footing, has combined Weather's TV and online technology and content divisions, which had previously operated independently, he says. The company, owned by NBCU and private equity firms Bain Capital and Blackstone Group, was acquired at the height of the market for $3.5 billion.
INVESTING IN INFRASTRUCTURE
The CEO says he also is investing heavily in Weather Channel infrastructure. He plans to relaunch Weather.com in July and says he will make improvements in live programming and originals. Since he joined the company, Weather has launched additional HD channels. "We're looking to increase engagement with the consumer and increase value," he says.
Weather sits alongside Disney's ESPN and Time Warner's CNN as part of a small cadre of companies that are as popular, if not more, online and in mobile as they are on TV. One unique sell that Weather Channel has is knowledge of the consumer. The entity knows where people are and where they are going as they search for weather and travel details. That's something agencies have tried to buy from the firm, though for obvious reasons the company keeps a tight rein on its data.
Kelly has drafted a new ad sales chief, Beth Lawrence, who came from Yahoo last December. She has signed up auto giant Toyota to sponsor The Weather Channel's brandnew, free iPad app (there is also a paid app). Within the first five days of the iPad launch, the free app was the third most popular.
Currently on-air is a cross-platform campaign from Nationwide Insurance that sponsors an emergency readiness program, Weather Ready, which covers everything from TV vignettes to online content to mobile alerts about pollen counts.
But the cross-platform sell isn't an easy one, even while media agencies talk about the importance of being media-neutral. While TV buyers are still the lead negotiators, separate digital agencies often control parts of client's budgets. According to Lawrence, TV upfront packages will all contain a multimedia component, and Kelly is investing in marketing and communications to get the word out about the company's cross-platform capabilities.
The company has interactive applications already in operation with satellite distributors DirecTV and Dish. Kelly says he's in talks with cable and telcos about expanding that business; he declined to specify which companies he has contacted.
As for Weather Channel TV programming such as Storm Stories or Tornado Week turning up online at either Hulu or Fancast Xfinity, that aspect of the cross-platform strategy is still in play. Kelly responds, "As the industry moves, along we'll be enthusiastic participants."
Meanwhile, a question looms over Weather's future ownership structure, given NBCU's pending acquisition by Comcast Corp. Time Warner has long had an interest in the property should it come available.
Kelly won't address questions about Weather's current financials other than to say, "It has been reported that we had a very successful refinancing and strong investor demand."
In March, TWCC Holding Corp., the financial entity that owns The Weather Channel, refinanced its $1.3 billion term loan. The fact that so many banks wanted in on that refinancing has engendered some confidence that the firm is headed in the right direction.
This month, The Weather Channel announced it had passed the 100 million subscriber mark, a feat achieved only by Turner's TBS. The service receives 11 cents per subscriber, according to SNL Kagan. Ratings in both total viewers and the 25-54 demographic are up year-on-year for the first quarter, in part thanks to the giant snowstorm that hit the East Coast in February and a variety of unpredictable weather events. The channel ranks No. 45 in 25-54 with ratings up 12% in the period, according to Nielsen data.
The company claims a total cumulative audience of 120 million users and says 30 million people rely on all three platforms: TV, online and mobile. By comparison, CNN's total cumulative audience is 130 million.
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