♪ david: he leads the company that operates four of the most popular cable channels for women, producing a wealth of content distributed around the world. david zaslav took the helm of discovery to take it public all within the span of a year in 2007. its market cap has tripled and now it is coming to terms with a world in which consumers increasingly turn to streaming services for their programming. they are moving away from the

core business of traditional cable. this is leading zaslav to but once again on content on this edition of "big decisions." david: thank you for joining us. you just completed the biggest deal of your career, $12 billion for scripps. why did you do it? >> is a financial region in a strategic drive could really work for us. we both do the same thing. it is what we do for a living, what we do when we come to work. we are quite comfortable with putting these companies together and the synergy gives us the opportunity to double our cash flow. scripps generates about $8 billion of free cash flow.

in a turbulent time, if we can emerge with almost $3 billion of cash, we are different than most media companies in the world. whether it is disney or comcast, nbc, cbs, they are mostly in the scripted and movie business. netflix, amazon that whole side , of the business -- if it was a soccer field, the ball is scripted television and movies. it is crowded and getting disrupted. the number of scripted series has gone from 200 to over 500. apple and amazon and netflix alone are spending almost $20 billion on top of these companies. we say, we are not that.

we are on the other side of the business. the own all of our content. it is real life entertainment. we see ourselves as a global ip company, and with scripps having food, cooking, travel, we are on a different area of the field. we say good luck to them. there is a lot of great companies and it will be very disruptive. our game is to take those great brands around the world. as people over the next few years pull content onto devices and phones, the functional value of food, home, cooking science, , cars, we'll have a chance to do better than if someone would pay to watch "the crown" on a mobile phone. a lot of it is figuring out how to get to mobile.

where people will pull your content. host: how will this help you get to scale, as it were? david z.: we have four of the top six or seven cable channels for women, with i.d., tlc, food, hg, and we have a lot ot offer -- to offer to an advertiser. discovery is in 220 countries. of a factory machines of driving ip all around the world. we do what very few media companies can do. we have a global offering of all of our content. host: will viewers be watching for platforms, or for programs, like "game of thrones"?

david: it is hard to tell what people are going to do. by generating free cash flow, by owning every piece of i.p. we own, except for sports, we have spent a lot of money to own it on all platforms. that gives us the opportunity, if amazon said, i would like to do this globally, the only other media company that could do that would be disney, in the kids space. so, we would raise our hands and say terrific. we have great family offerings. for us, it is about the long tail. people that love food are going to pull it. we not sure how it is going to work, but we think the fact that we have passionate viewers that love the sports team, they will come home and to put on hg all day long, and food.

we have a sustainable growth business and all of this i.p. we take to the consumer. and we have started to do it. host: can you win in streaming without going through the bundlers? do you have to be on hulu? to have to be on youtube? or do you have to do it directly? is your product strong enough? david: we don't know. everywhere else in the world, we are on almost every skinny bundle. we are not on hulu, but most of the others. people love our channels. we hope to get on the skinny bundles overtime and partner with our distributors. they helped us build our business. in many cases we are, we are partnering with at&t on directv now. that is the best way to do it. there is an opportunity for us to go with to the consumer ourselves, which we are already doing in a number of areas.

we could also go to those big companies. if you take a look at what the networks spent, three years ago, and how much is being spent by amazon, netflix, apple and google, that is a massive amount of share shift going on. these are global companies, the likes of which we have never seen before. if any one of those companies wanted to offer a compelling family friendly service, we would like to be most of it, or all of it and see how it goes. anywhere you go in the world and use a discovery or animal planet or i.d. -- you say discovery or animal planet or i.d., people know the brand and own them. host: how will you make the decision as ceo?

david: the direct to consumer businesses, preview used to be that the great dual revenue stream would go on forever. the view is that it is now getting disrupted by some of these direct to consumer platforms. there is the question of who is going to be the winner. it is only the second or third inning now, but we have carved out a very compelling -- spot of a quality brand the love -- people love that we can offer globally. host: sports. that was a variation that people had expected from you. why did that make sense for you? ♪

♪ host: you talk about disruption in the media. you created cnbc. what did you learn when you disrupted broadcast? david: patients. in that case, jack welch and bob white were committed to try and

take the broadcast business into cable. it was unusual for people around that time. the business you think that is going to work never works. the audience is always going to tell you what you get nourished by. that is what our business is about. when we launched with own, we look to strategically at the space and said, we can do this. super soul sunday was terrific, but the audience went away and we had to figure out what they would come back for. it took is a lot of years but we started to listen -- what do you like? that is what our business about. we don't have everyone to watch, but the oprah winfrey network is now the number one network for african-american women. 4s know, we have broken our con -- broken our company and half

now. we have half the company that is about growing our channels. we believe we can do as well or better as anyone in the world. then there is a whole group that has to figure out, how do i get over the top? you have to be willing to recognize failure and use it optimistically. >> you can do it without the blockbusters. >> the way people watch our channels, they come home and, hg gets me, discovery is my channel, tlc is the middle america channel. i love oprah. that is the channel i watch. that is how they curate. where do i get nourished? we think that business is going to be sustainable, and we could pull one of these expensive platforms, or, they could get characters for a walk less than they would have to pay for that,

and then we look different. it may be an individual or aggregate offering, but we have a game. host: stepping up big time on sports was a variation than what people expected from you. david: we have a distribution team, a sales team, creative, marketing, and strategic people. we know each country. individual sports was not being fed into individual countries across europe. we said, we can do this ourselves and use our distribution infrastructure, use our sales and marketing people. this was driven by the idea that this used to be about getting inside the rectangle, the television box, and if you had

content that was second or third choice, it would be ok. when we launched our direct to consumer sports player in europe, we reached across 715 million people in europe. we have tennis, winter sports, summer sports, cycling, the olympics. with a great offering. 715 million people. eight dollars, we should be able to do terrific. ten things we thought we knew, eight of them were wrong, and the users told us. they said, we tuned in for the french open but we didn't want , to watch the tour de france. we love tennis. or maybe the most interesting takeway we applied is that when people consume content on a device, they expected to the device in the morning and see content. and a few hours later.

you need multiple publishing. speedskating is starting at 2 p.m. people who love speedskating want to get up the morning and see a one minute video. or 21 minute videos or some information about -- we downloaded 700 pieces of short form content in 21 languages every day to our olympic player. that is one reason why people are -- we were able to navigate that half a million subscribers. they loved the sports ip but they really, when people look at content on a device, they expect to be entertained and nourished whenever they kept the device. you hit it and nothing is new, you are disappointed. host: can you do that and not step up into high price sports projects? that to some extent sounds like espn and the early days. espn has lesser sports and then had to get into the nba and nfl. the cost at enormous amount. does your strategy stop short of that?

david: we haven't taken football where we get into a war with anyone. if you want to offer your content on a pan-european basis, there is only one place to do it. where few are a federation -- if you are the speedskating federation, you could sell it in any country. the difference between u.s. and europe, in the u.s. has one culture, one language, four sports. essentially. 90% of viewing him at 80% of viewing is football, baseball, basketball, hockey. in europe, the number one sport in northern europe is number 10 in southern europe. if you're a federation, we are the one stop it we have been very effective about getting a lot of content. all the we have with eurosport, as much as we can we have gotten , long-term and we own it on all platforms. host: you say you have scripps, but is that enough for discovery? are you on the outlook for further acquisitions? ♪

♪ host: you have scripps, but is

that enough for discovery? are you on the outlook for further acquisitions? you need to get bigger? david: we were at a different place in the soccer field. if we can execute those passion brands globally, we have an opportunity to convert into 48 languages. we will start to spread it around. viewership increases will be a revenue center. in latin america we have bought some of their content. i like our hand. we have some work to do. we have to pay down some debt. we have to prove we are going to generate that free cash flow. and that we really did build them out. at the same time, we are going to be working hard about learning how consumers consume content on devices. we talking to every distributor. we are better off than someone who was already paying a $100 bill, and has a chance to check

a box than pick us. today in the u.s., there are 25 or 30 million subscribers that are broadband only. the one service being marketed to them heavily is netflix. the industry built us and we built them and i think we will come up with something that is going to be compelling in terms of the skinny bundle. it is not sensible to have netflix have all of that field. host: you do have more debt on your bounce sheet been a lot of other media companies. you say you were going to save $350 million a year on scripps. how are you going to do that? that is a lot of money as you and i both know to save in an operation. david: it has only been five weeks, but we have been working hard on this for six months. we think that is rather conservative. we have 12 channels in the united states, and they have six.

we are in the same business. we have 220 research people and they have 140 research people. we've 650 salespeople they have 550 salespeople. their people are really good. we have put some of their people in charge in our new structure. the idea is, who was best for the price that go when it comes to nonfiction, who were the best producers of nonfiction content and who is the best at monetizing? they are better than a set some areas and in others we are better than them. we put these two together. billionspend 3.5 dollars on content. maybe growing to more than that. this is a hard business. we are in the business of creating stories and characters. getting people to turn on their tv and love it. host: what is it like to have john malone as someone to call up and say, should we do this or that? david: i think about my last 30

years in this business and, it is sort of like what you want for your children. you are who you hang out with. it helps to define the narratives and questions you hear. i look back over the last 30 listening to years why jack didn't want to do an acquisition or what we need to do with cable, how we do it, bob wright, the newhouse family, and bob miron who is a genius. and john malone. when i think about where people should be spending their time, you would like to get the right job, to think you were going to make some money, but i took a 50% pay cut to go to nbc because i thought i could hang out with the guys at the tea cart, and maybe someday i would get to be jack. a lot of the way i see the world , i still talk to jack all the time. i am hearing his voice, bob and

donald ross voice, and john's voice. for that alone, i am one of the luckiest guys. host: it strikes me you are now running discovery, which appeals in the united states to a lot of the middle of the country. i hear the president is a fan of "shark week." i read that some place. david: i hope he is a fan of a lot of our stuff. host: you helmed msnbc and that channel is now a very different place. what do you think about the media landscape in terms of politics, because it has become much more polarized? david: the business changed. when we launched msnbc come up rocco and i, there was a group of us. jack said, we will launch the best news network in america and we're going to get the number one news division in the world to do it. we had this amazing library. we structured a deal with microsoft.

they wanted a library at the time. that was our ambition. i'm not going to game out the different news networks in america, but we have to be practical and recognize some are following the model. on one hand you want to do the , best journalism possible. on the other hand you want them , to watch you for as long as possible. part of the way human beings determine our success is, rv -- are we in third place, second-place? how many people are watching us? how many people love us? luckily i am not going to be one , of the guys to figure that out. host: how do you keep score? that leads us to a great conclusion. how do you keep score? i see now you have jumped up in the rankings. a big step up with scripps. is that a way to tell whether you are succeeding? david: no. there are lots of books have been written about whether the

scale tips you over. we are staying in our lane. what is going to be successful for us and we have made this decision, on every one of our channels we have said, if you don't love us, love science or crime, go find other channels you love. we are creating content for our channels we want global , audiences that affiliate and have a passion for our characters and message. a big piece of that is we are not going for the best rating, we are going for the most potent audience that says, they get me. when i go there i see something i love. if we put something on any of these channels, they will say, what is this doing on here? they are quite clever. this is what we do for a living. we have to try and figure them out in terms of what they love. host: thank you for spending time with us.

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♪ >> "bloomberg best coming up on that coming up on "bloomberg best," the banks wrapping up record profits. new nominations for lout the powell fed, a meeting in mar-a-lago is one of many geopolitical matters moving markets. frustrationa lot of . >> it is a meeting that isn't going to be fruitful, we aren't going to go. newor: south africa's president speaks about his nation's financial future. >>