Breaking News: My Blackberry went a buzzin’ last week when the rumors we were all hearing were substantiated and made official. The iconic company behind GI Joe, Transformers, and My Little Pony is partnering up with Discovery Communications in a $300M deal to take on Viacom’s Nickelodeon, Walt Disney’s Disney Channel, and Time Warner’s Cartoon Network in the very lucrative children’s TV market.
The joint venture will see a major rebranding effort of the 60M home Discovery Kids channel, creating new shows based on brands such as GI Joe, Scrabble and Cranium. Each company will hold 50 percent in the venture.
Apparently all the gloom chatter from earlier in the year is being mitigated by a flurry of channel launches and rebrands both in the US and the UK. I’ve seen a noticable uptick in briefing and agency exploration meetings. It’s an incredibly exciting and busy time in our business. Thank goodness for that!
Hasbro chief Brian Goldner called the network part of “reimagining the potential of our incredible portfolio of brands well beyond traditional toys and games.” Incidentally, credit ratings agency Standard & Poor’s changed its outlook yesterday on Hasbro Inc. to “Stable” from “Positive”.
The companies would jointly go after merchandising and licensing revenue based on programming content say sources. Discovery will handle ad sales, distribution and other operations and Hasbro will provide studio-produced programming.
The realignment itself is ambitious with solid strategic reasoning. Discovery Communication’s top 3 channels, Discovery Channel, TLC, and Animal Planet account for 80% of their US revenue, while 7 of their other networks (45M homes each) represent a growth opportunity.
I executive produced a rebrand for Discovery Kids a few years ago when they were trying to build greater awareness on NBC Saturdays through a co-branded morning block. Since then Discovery has made it a clear priority to make their channels relevant and properly positioned within their master brand heirarchy as exampled by the conversion of Discovery Times into Investigation Discovery, Discovery Home rebranded to Planet Green, and the newest launch of Discovery Health becoming OWN, The Oprah Winfrey Network.
Apparently a souring economy has meant “people are spending more time at home” Discovery Communications CEO Zaslav said, adding that Discovery had seen almost double-digit growth in the first quarter.
The yet to be named network, aimed at kids 14 and under, is slated to launch in 2010.