Discovery has amassed one of the media industry’s biggest original programming portfolios. It's trying not to get left behind as its competitors go long on IP and direct-to-consumer streaming services.
- Discovery is long on licensing revenue. The company’s $14.6B acquisition of Scripps in 2018 was aimed at building Discovery’s arsenal of original content with distribution revenue and future streaming efforts in mind. With the deal, Discovery gained properties focused on unscripted programming like the Travel Channel and the Cooking Channel.
- Discovery executives now tout IP over advertising. Since 2014, mentions of “advertising” in Discovery’s earnings calls have trended down year-over-year. Mentions of keywords associated with licensing and distribution fees, as well as “IP,” i.e. intellectual property, have trended upward since 2016. (Note: in media, “intellectual property” refers to content and franchises rather than patents, trademarks, and copyrights.)
- Discovery sees IP as the cornerstone for successful digital and direct-to-consumer efforts. With giants like Disney and CBS launching direct-to-consumer streaming services, Discovery is building up its programming prowess to avoid getting left behind.