Werbewoche: Does AZ Medien actually make money from its TV stations?
Robert Elsener: We are satisfied. As regionally licensed broadcasters, Tele M1 and TeleBärn are not allowed to distribute profits. We do everything we can to reinvest all our revenue back into our programming and high-quality editorial work.
At TeleZüri, which doesn't have a license and therefore doesn't receive any license fees, you're likely to turn a profit …
We strive to operate profitably despite the headwinds and to invest our revenue in a high-quality program and program initiatives.
So the stations are more important to the group from a journalistic standpoint than from a financial one?
As AZ-Medien, we are a commercial enterprise, not a charitable organization. It is important that we deliver strong financial results. However, we have a journalistic mission that we want to fulfill effectively.
How is the AZMedien network organized?
Creating synergies makes sense when you operate multiple TV stations under one roof. But for us, the editorial independence of the individual stations is essential. There is little overlap because we produce content for the regions from within the regions themselves. National segments can occasionally be produced jointly. Where we have already been able to realize synergies, however, is in the areas of production technology, infrastructure, and IT. That’s where the greatest potential for synergies lies.
Let's take an example. Yesterday, Federal President Didier Burkhalter called a press conference. What happens now—does each broadcaster go there on its own, or does one produce coverage for everyone?
That varies from case to case and is coordinated editorially between the stations on a case-by-case basis. Let’s take Sochi as an example. We sent a team to Sochi, which isn’t exactly cheap—airfare went up about tenfold during the Games (laughs). We use all this footage to create regionally focused segments. For example, if an athlete from Bern really stands out, they’ll get more coverage on TeleBärn than on TeleZüri.
But isn't the material produced centrally?
In this case, yes, but we had several teams on site at the Swiss Wrestling Festival. Last year, the festival was heavily dominated by wrestlers from Bern. So, naturally, we at TeleBärn place a different emphasis on the event than Tele M1 or TeleZüri do.
What are the similarities and differences between TeleZüri, TeleBärn, and Tele M1?
The similarities are obvious: All stations produce about an hour of content per day and repeat it in a sort of hourly loop. Conceptually, the stations are similar, but their content varies by region.
Does TeleBärn have a different role in Bern than TeleZüri does in Zurich?
You have to look at this from different angles. First, there are the viewership numbers. For reasons we all know, the research results last year didn’t always make us happy (laughs). However, we’ve seen very positive growth in terms of market share. Another aspect is the direct feedback we receive from customers via phone, email, or social media channels. We often receive feedback, even when we have teams out in the field. That’s where you really get a sense of how highly valued our stations are in the regions. In that respect, it’s difficult to compare TeleZüri with Tele M1 or TeleBärn. This is precisely because TeleZüri has had a supraregional focus since 2008 and makes sure to provide good coverage not only in Zurich but also in the Mittelland, Central Switzerland, and as far as Schaffhausen and St. Gallen. Tele M1 and TeleBärn are more focused on their respective broadcast areas. Tele M1 takes a more regional approach with its East and West channels and recently opened a correspondent’s office in Solothurn to provide even better journalistic coverage of topics relevant to the region. All of our stations have their own distinct character and history. TeleZüri is celebrating its 20th anniversary this year, and the others will soon mark their own anniversaries. The stations have grown alongside their viewers over the years.
So, is the level of acceptance comparable across the different regions?
Yes, the nature of it is simply different. Overall acceptance is very high across all stations and comparable at a very high level. Looking at the total audience: During that one hour when we produce original content—between 6 and 7 p.m.—we have excellent market shares within the regions and license areas. In Zurich, there are days when our market share among the total audience during that time reaches 30 percent. We have a strong foothold in the Zurich, Mittelland, and Bern regions.
TeleZüri does not have a license, while TeleBärn and Tele M1 do have licenses and also receive license fees. Are there any plans to give up these licenses in order to have more freedom in advertising?
I can answer that with a clear “no.” It’s not as if we find ourselves constrained by the terms of the concession agreement. The substantive focus of the concession agreement is appropriate and aligns with our journalistic standards of quality. As you correctly point out, we would have a bit more flexibility when it comes to advertising. But I’m not aware of any cases where we’ve had to forgo advertising revenue due to licensing requirements. When discussing matters with advertisers, we can usually find good opportunities for flexible solutions.
What is the current prevalence?
We need to distinguish between analog and digital broadcasting. A significant portion of our viewers still receive our broadcasts via analog signals today. Perhaps it is no longer their primary TV set, but rather their second or third set. Within the license areas for Tele M1 and TeleBärn, we have full coverage of the analog and digital distribution channels relevant to us, as guaranteed by our licenses. For TeleZüri, we also have full coverage—both analog and digital—in the core area. Digitally, our stations can also be received outside their license or core areas within the language region. We receive inquiries from cable network operators in various regions who would like to add our stations to their lineup. A concrete example is Laax/Falera. The local cable network operator would like TeleBärn to be available on the cable network for vacationers visiting Bern. But it’s certainly not as if we could quintuple our market share that way (laughs). For viewers outside the respective license area, we don’t have the same relevance as we do in our main broadcast area.
On another note: How important is the streaming section on your websites?
At some point, we’ll no longer talk about streaming, but rather about video consumption across all devices. Whether it’s analog, digital, or online doesn’t matter to the viewer. For us, it’s essential that we have a presence on all devices relevant today—from the iPhone to the big TV screen. The distinction between linear and non-linear consumption also isn’t that important. What matters are the «eyeballs»—that is, the viewers’ attention. Video advertising has the advantage that CPM rates—even in the online world—are at a very reasonable level compared to display advertising.
The problem is simply that current research can't account for everything …
Research can capture online and TV usage relatively well. But you’re right—there’s currently a disconnect between how online and TV usage are measured. It’s important to us that, wherever our content is consumed, there’s a measurement methodology in the background that allows us to monetize that usage. «Lost»—that is, unmeasured—usage is what hurts us.
Of course, the advertising industry would prefer a value …
If there is a «metric» that accurately reflects performance, is easy to use, and also provides us with the insights we need to optimize the program, then of course we wouldn’t say no to it.
How did the individual stations perform last year?
TeleZüri has gained market share, Tele M1 has lost a little, and TeleBärn has gained a bit, but a direct comparison with the previous year isn’t really valid for methodological reasons. We’ve had a stable year and, viewed over the course of the entire year, we offer programming of consistently high quality. This year, we face two challenges from the competition: right now, Sochi, and then the World Cup with kickoff times at 6 p.m. We’re trying to counter this with special programming.
What percentage of the programming on the three stations consists of domestic advertising?
The share is significant, but the largest portion consists of regional and local advertising.
You're switching all your channels to HD this year. When will that happen, and how much will the investment be?
We haven't yet determined the specific transition dates. It's a significant investment.
What does that mean?
There are various ways to produce HD content. Simply upconverting the SD signal and then calling it HD is not our goal. We want to offer as much native HD content as possible. However, this leap in quality means that the entire production chain—from the camera to the studio equipment to playout—must be in HD. Today, the individual broadcasters have different levels of infrastructure, so more investment is needed in some areas and less in others. Overall, though, it’s a significant amount of money that we’ll have to spend.
Is it worth the investment?
We have to make this investment. First, for the viewers. We aren’t compared to other local stations, but to the highest standard set by any broadcaster. If you want to be among the leading TV stations, you can’t deliver television in a lower technical quality. Advertisers are also interested in high quality so they can showcase their products in the best possible light. The third party in this equation is the network operators, who, for their part, want to be able to offer as many channels as possible in HD quality.
You have three successful channels. TV24 is a new addition to the lineup. What are your goals for the new channel?
In the medium term, we are aiming for an 1% market share with TV24. For us, TV24 represents a logical next step in the development of our family of channels.
Why?
For one thing, because we already serve an audience—more than half a million people a day—that really appreciates the content we produce. However, this audience cannot find much of the content they’re interested in on our channels. With TV24, we have the opportunity to offer both our existing and new viewers content that we haven’t shown on our regional channels to date.
Are these programs that don't fit into the current hourly schedule?
Exactly. With TV24, we can show more content that previously didn’t have a place or didn’t meet our public service mandate by leaning more toward entertainment. In a sense, though, it also serves as a bridge connecting our family of stations. We currently have about 130 employees who produce television content every day. This enables us, for example, to produce a daily news program using our local or regional news stories that have national relevance. Since we have the three largest regional television stations in our portfolio, we are—alongside Swiss Television—probably the only ones in Switzerland with TV news expertise at the national level.
Isn't there also a risk of competing with their regional stations?
Our regional stations are our backbone, our heart and soul, and they will remain our main focus in the future. We can position TV24 as a complementary channel so that our existing channels are affected as little as possible. The variety of TV channels continues to grow. So it’s better to have our own channel that we can position as a complement than to be defenselessly at the mercy of further fragmentation.
Will there be a news program on TV24?
Yes. But of course, it won't air at the same time as on the local stations. In terms of content, it will be a "best-of" compilation of the daily news segments that are produced and have national significance. These will be produced and hosted in a new studio set.
What else will there be?
With TV24, we have a TV station in our network that broadcasts a variety of programming 24 hours a day, seven days a week. This also gives us the opportunity to try out new topics, see how they work, and perhaps use them for our regional TV stations as well. Conversely, we have the opportunity to air longer versions on TV24 of certain formats that have been very successful on local stations so far but could previously only be produced in segments lasting just a few minutes. Since we can also draw on a wealth of previously produced content, this creates significant potential for synergy. With TV24, however, we also aim to attract new viewers, whom we hope to introduce to our local TV stations through cross-promotions.
When does TV24 start?
In the second quarter of 2014.
How many people will be working for TV24?
Much of the content is produced by our current staff. We will supplement the team on an ad hoc basis for roles that do not yet fall within our core competencies. In the medium term, we’ll also be developing on-air personalities. This will help raise the channel’s profile. We don’t yet know whether these will come from our own talent pool or be entirely new people.
Two new shows are planned for 2014 on the existing channels: «Fashion Run – The Shopping Duel» and «The Gran Plan.» Both are adaptations of successful foreign shows.
That’s not entirely true. «Fashion Run» is an original concept, though it is similar in nature to other shopping formats. We also deliberately chose to deviate from existing formats because we feel that our approach to the fashion theme works better in Switzerland. The fashion sector resonates strongly with our viewers, and we also believe it will be an ideal platform for the advertising industry—not only through traditional advertising but also through product placement and the integration of filming locations. «The Gran Plan,» on the other hand, is a licensed format we’ve acquired that’s being adapted for the Swiss market. We’re convinced that we need to invest in order to achieve long-term success in television. We want to strengthen the current regional television programs and lead them into the future with technical and programming innovations. With the planned new half-hour shows—another one will be added—we aim to selectively strengthen our existing regional television stations and keep viewers tuned in to our channels for longer.
Who produces the shows?
Golden Eye Media produces both formats.
What's planned for TeleZüri's 20th anniversary?
We’ve got quite a few things going on. We have a testimonial campaign on the air, and along with the switch to HD, we’re also introducing a new on-air design. In addition, we’re running contests and will be hosting various festivities this fall. After 20 years, all of this is certainly well-deserved and, not least, a tribute to the fantastic existing TeleZüri team led by Markus Gilli.
Interview: Pierre C. Meier
An article from the current print edition of Werbewoche.