NBCUniversal creates new channel for kids in TV wars

LOS ANGELES • In a new salvo in the children's television wars, NBCUniversal is creating its own Disney Channel.

Starting on Sept 9, NBCUniversal will turn one of its smallest cable properties, Sprout, into a network called Universal Kids, said Ms Deirdre Brennan, who will oversee the effort.

She added that NBCUniversal wants to create an "umbrella brand" for its family offerings - television cartoons made by Universal- owned DreamWorks Animation, Universal-Illumination films and attractions at Universal theme parks.

Sprout is solely aimed at pre-school viewers, but Universal Kids will concentrate on children aged two through 11.

The revamped channel's first series will be Top Chef Junior, a spin-off of the cooking show on NBCUniversal's Bravo.

"Reality programming is a real white space in the US children's market - food, pets, dancing, even news," said Ms Brennan, who will be general manager of Universal Kids. "Look at how sophisticated 11-year-olds are these days. They want more than the same sitcoms."

At its start, Universal Kids will also show reruns of DreamWorks Animation cartoons such as All Hail King Julien, which is connected to the Madagascar movie franchise.

NBCUniversal bought DreamWorks Animation for US$3.8 billion (S$5.3 billion) last year, an acquisition that hinged in large part on the boutique studio's television cartoon business.

Ms Bonnie Hammer, chairman of NBCUniversal Cable Entertainment, said the goal is to create "an even richer entertainment experience and a new strategic business model".

Continuing as it is now would have been perilous for Sprout, which has low ratings and reaches only about 59 million homes in the United States. Nickelodeon, in comparison, is in more than 90 million.

As more consumers look for slimmed-down cable packages or forgo a cable connection, bottom- rung channels are not expected to survive. Comcast, which owns NBCUniversal, may see a robust children's television business as important to its goals with its Xfinity TV service, which includes a Netflix-style streaming component.

Cartoons - many supplied by DreamWorks Animation - have been crucial to Netflix's emergence as an entertainment home base for families.

Universal Kids may also be aimed at taking advantage of marketplace tumult. Ratings have recently tumbled for some children's television stalwarts.

Viacom's Nickelodeon held steady among viewers aged two through 11 in the first quarter compared with the same period a year ago. But Time Warner's Cartoon Network fell 15 per cent, according to Mr Todd Juenger, a media analyst at Sanford Bernstein.

Disney Channel, which does not accept traditional advertising and focuses on children as old as 14, declined 20 per cent while the advertisement-supported Disney XD plunged 27 per cent.

There is no guarantee that Universal Kids will fare better.

One cautionary example: After pouring resources into a children's channel called The Hub in 2010, Discovery Communications and Hasbro retrenched staff in 2014.

But analysts said there is too much potential value on the table not to try. Each year, children's TV generates billions of dollars in advertisement revenue, subscriber fees and toy sales for Disney, Time Warner and Viacom.

NYTIMES

A version of this article appeared in the print edition of The Straits Times on May 02, 2017, with the headline 'NBCUniversal creates new channel for kids in TV wars'. Print Edition | Subscribe