HRTS Member Profile: John Penney
John Penney is Chief Strategy Officer at Starz. I recently had a chance to interview John to discuss cost curves, TV Everywhere and the convergence of media, entertainment, and technology.
Q: Can you tell us about your background and what made you want to work in entertainment?
-I am originally from New York and my parents were artists. I love being around smart, creative people. I was and remain fascinated by the business and technology of entertainment, as well as the global scope of the industry. So when I had the opportunity to join Viacom after nearly a decade on Wall Street working with the entertainment industries, I jumped!
Q: How did you first get involved with the HRTS?
-When I moved to LA eight years ago, I attended a Hitmakers Luncheon. Hearing leading business and creative thinkers describe their points-of-view on the future of the entertainment business was exciting and useful. Having attended HRTS luncheons and events over the years, I have seen the value these offer as excellent learning and networking opportunities.
Q: What is a favorite memory from your career thus far?
-I have had a strong interest in technology that goes back to my teen years when I experimented with electronics and early computers. Those early experiences provided me a foundation to develop an early viewpoint on the global convergence of media, entertainment, and technology. Thinking back to 1990, when I was in banking, my colleagues took a great interest in what must have appeared then like heretical ideas around the transformation of media and entertainment through computers. Don’t forget—this was pre-Internet and AOL; think interactive CD-ROMs!
This is one of my fondest memories, since we were so early in thinking about how technology would transform entertainment. Of course, we didn’t have a clear crystal ball, but it was gratifying to have been able to participate in this early dialog.
Q: How is Starz strategically positioning itself as a premium television network?
-Over the past 5 years the STARZ network has been transformed from a predominantly high-quality movie service, to a full-blown, premium TV entertainment network providing its subscribers engaging TV series and a fantastic breadth and depth of movies. With original programming now a core attribute, Starz, as a business, is positioning itself to be what it truly can be—a nimble innovator.
Starz is working with its traditional and new distributors to create new opportunities to bring the 14 STARZ and ENCORE networks to consumers in innovative ways that address their needs. For example, bringing STARZ to viewers across a broader spectrum of TV Everywhere platforms and to consumers via broadband distribution in partnership with our traditional distributors.
Starz is also aggressively pursuing international markets, both in the distribution of our original programming, and through new branded platforms like STARZ PLAY Arabia, an SVOD platform we launched last week. STARZ PLAY Arabia will serve 17 markets in the Middle East and North Africa with a rich offering of quality TV series and movies.
Q: How does the global marketplace factor into your decision-making process?
-With the rise of new, large global economies capable of supporting vibrant middle classes, the international demand for quality content and entertainment services is sure to grow. I believe emerging markets' burgeoning middle class households represent one of the largest growth opportunities for the global media and entertainment businesses. This is a tremendous opportunity. As a strategist, if you’re not thinking globally then you are almost surely wearing a large pair of blinders.
Q: How have the economics of technology and content changed in recent years?
-As a general construct, the increasing global demand and rising incomes supporting the purchase of quality content, in tandem with more efficient production workflows, points to continuing solid content and distribution economics. The technology-enabled transformation of entertainment production and distribution wrought by digital technologies has and will continue to have far-ranging impacts that reach every corner of the commercial television ecosystem.
With breathtaking pace, declining cost curves for production/distribution technologies are enabling a new wave of video media content creation that blurs the lines between that produced by large and small production companies. The computing paradigm shift that the mass-scale roll out of cloud based technologies represents will significantly impact the content value chain from production to distribution.
Q: How do you see the industry changing over the next few years?
-It appears that one of the largest changes for business over the coming years will be a reorientation of the industry’s historical focus on delivering content to households to delivering content and compelling entertainment experiences to individual consumers. With the rise of two-way enabled, on-demand, multi-platform distribution, the individual is the new focal point of customer entertainment satisfaction since the power to hit ‘next’ or ‘skip’ with nearly zero friction now resides with the customer.
But wait…there’s more: the ability for networks and distributors to recommend to and receive feedback from consumers, along with sophisticated algorithmic and human-based curation and the power of social networks to be recommendation systems, will open up fantastic new possibilities for delivering the most relevant entertainment experiences yet. Yes, there will be a lot of data to analyze and the entertainment business will have to move to a new level of sophistication around how it mines so-called ‘big data,’ but in doing so it will have the ability to create new, consumer-centric opportunities that will ensure its relevance no matter what the world of technology throws at it.
Q: Anything you’d like to add?
-As a friend of mine once commented in prescient moment: “The future will be the same… only more so.” We’re all in this together and I look forward to the possibility of working with you to invent the future and an even more dynamic, global entertainment business.