This is no time to rest: an interview with Pro Plus CEO Pavel Vrabec
Pro Plus remains the undisputed leader both on the TV and digital market in Slovenia. CEO Pavel Vrabec tells Yako Molhov that the company has no time to rest following the recent exit from the FTA market and is actively developing new formats and investing more in flagship nets POP TV and Kanal A, as well as strengthening its cable channels, digital platforms and SVOD service Voyo.
Mr Vrabec, the biggest development for Pro Plus this year was the exit from the free TV market. What prompted this decision? How will this affect your operations and financial performance?
This is a deliberate business decision which will bring the company's operations in line with technological progress and viewing habits. State-of-the-art means of receiving TV channels are available to more or less anyone. At the time we announced our decision, only 12% of viewers watched television exclusively via the terrestrial platform. For PRO PLUS, the new business model means it is less dependent on the highly fluctuating advertising market, and thus can ensure more stable investments in the development of the company, in local domestic production, and in its programming. At the same time, this brings us at least a little closer to having equal footing with foreign content broadcasters in Slovenia.
Have some operators still not signed new distribution agreements with your company? How would you comment the allegations that you abused your position on the market when determining the price of your channels?
We have concluded cooperation agreements with all the operators in the country. We strongly reject any and all allegations of abuse in this case. On the contrary, we strictly adhered to the applicable media and other legislation, and carried out all negotiations in accordance with the principles of best business practices. The fees agreed with operators in the context of complex business negotiations represent the fair share, which is proportional to the ratings of the channels POP TV, Kanal A, Brio, Kino and OTO compared to all television channels.
Your competitors have complained that the audience measurement panel was not changed after you left the free TV market. Has your withdrawal from DVB-T broadcasting affected your ratings?
These complaints are unfounded. According to the assurances provided by AGB Nielsen to the entire market, as a result of this situation, best practices from other countries in similar major market changes were applied. Based on detailed preliminary analyses and familiarity with the market, we expected and were prepared for an approximately 5 percent drop in viewer ratings. As a result, already in January we launched our spring campaign and top series, and have already succeeded in virtually eliminating this expected drop.
Are you planning to offer more premium channels to your pay TV customers?
As the leading media company in Slovenia, we are many steps ahead of others and certainly these are questions we dedicate a lot of time to. However, at this moment in time, I cannot give you a definitive answer to this question.
Pro Plus is year after year mentioned as one of the CME companies that the media giant wants to sell. Recently, it was speculated that Telemach is interested in a deal. What is the truth? Is your financial performance the reason for these rumours?
As a matter of policy, I do not comment on rumours.
What is the situation on the advertising market in Slovenia? Is there a price war between you and Planet TV?
For the second year in a row, we have recorded growth of the TV advertising market, which is a result of economic recovery and a more optimistic outlook for the future. We need to win our piece of the advertising pie with a rich offering of programming, as well as through innovative and creative approaches. The price of advertising is determined based on ratings and in light of this, there is no war, since our channels remain convincingly in top position.
What are POP TV and Kanal A's hits this spring? You are investing more and more in original projects on POP TV, while Kanal A continues to rely on strong acquisitions and sports broadcasts.
This spring, POP TV offers viewers the greatest local hits, such as Strictly Come Dancing, MasterChef Slovenia, Taste of Love (aka Fatal Wine) and Farmer Wants a Wife. The remarkable story of Bergdoktor, which has captivated Slovenian viewers, continues, and is achieving excellent ratings.
Kanal A is already in the middle of the season of football matches of the UEFA Champions League, Europa League and First National League. We have begun broadcasting the new MotoGP season, and this year we will continue to strengthen the sports offering of Kanal A. The highest rated news program, a wide selection of content offered by thematic channels BRIO, OTO and KINO, and growth in subscribers to VOYO, are also indicators of our sound programming decisions.
What is your strategy for 2017?
Although we have only just completed the process of changing our business model, this is no time to rest. We even more eagerly plan for the future, especially completely new formats, tested shows for which there is still space in our media environment, and provide strong programming support to Kanal A, which will become home to the best sports programming. We also see an enormous potential in our thematic channels, which we will harness through carefully targeted contents.
Startup Slovenia is one of your most successful local projects – both on and off the screen. Have you received international interest for the format?
We have just learned that, in addition to all the accolades the entrepreneurial initiative Startup Slovenia has already received, it has managed to qualify among the twenty most innovative marketing projects last year in the WARC Innovation Awards 2017 competition. The Startup Slovenia show echoed around the world. And we have already received expressions of interest in purchasing the format.
Pro Plus has always been a major player in the digital media business in Slovenia. What is your strategy in this segment?
Also in this field we have top position among our Slovenian competitors. The 24ur.com website attracts the highest number of readers in Slovenia, while the remaining seven specialised web portals are leaders in their markets. Currently, the gradual renovation of all portals is taking place to ensure they keep in pace with the latest technology and content trends, on all devices. Both user- and advertiser-friendly. Our advertising network ProAd bloomed this year and the results are extremely encouraging. We invest in the development of native advertising and programmatic solutions that will enable tailored content for the users, and better targeting and segmentation options for advertisers. The aim is to retain our current position in terms of both the number of users and the advertising revenue from digital advertising.
Are you happy with the performance of Voyo? Are you planning more original Voyo productions?
Pro Plus was the first media company in Slovenia to offer subscription-based video content on demand. Voyo currently has just over 40,000 subscribers, which we are very happy with. Subscribers are attracted by local production, as well as original content available only on Voyo. One of the most successful was the series V dvoje. In light of this success, we shall continue such projects. At the same time, we are introducing new projects. During the Sunday primetime show Strictly Come Dancing, Voyo subscribers can get a 360-degree view of the stage thanks to a 360-degree camera. At the same time, the exclusive broadcasting of sports events also continues.