Julia thanks to the new periscope and merekat technology, people found a new way to get around paying for sports content. Obviously its a very new technology. And been around for a long time not an internet problem internet problem not a periscope problem. Sports has been such an integral part of Holding Everything together. Are you worried about all these new technological threats, and breaking apart the content bundle, whether thats one sold via the internet or paid tv, over cable . Tom buying content is probably less expensive for us from buying it in packages from large content companies. The big issue Going Forward what you are referencing is security is a huge problem in the digital age. And we have very fast highspeed networks. Storage that you can buy is getting keeper every day. So people can keep content and move it arne the world instantly. The security of content and how content Companies Sell their products and whether they are secure or not ultimately we are paying for is a real issue. If they dont secure their content, it wont be worth much. Thats the lesson of what we just saw this weekend. Theres another dimension to it which is the thing that was exploited in the case of the reprance transmission of the fight this weekend was the analog. Rob there is no way to close that. If the eye can see it, a digital device can see it, and the real issue arose out of the mass transmission of something that was otherwise simply seen by another person. Im not sure how to solve the problem securitywise but certainly i think for all of us who live in this ecosystem protecting intellectual property is critical. Julia looking down the road as consumer demands change, youall seem to say you want to give consumers as you want, how are you as Companies Going to have to adapt to these changing Consumer Needs . There are nanls going on here panels going on here about new mi lenials and the expectations they have millennials and the expectations they have. How does that change your business . Pat . Pat they want access, they want plecksibility, they want different size packages, they want to use technology they want it on multiple screens. The industry has demonstrated we are trying to do that. At the same time, a conversation there about periscope or merekat these are real. Thats the world we now do business in. If we dont manage it properly, they are still going to exist. There is good reasons those apps are getting used. Its our new world. We have had these one thing i do agree with with the chairman is, we have had a number of moments in our history where we reinvented ourselves. I think we are going to still have those moments in my career Going Forward. The future is very bright. Can i take cox, look at our company, man, look whats going on. We rolled out ghiga net services in multiple markets. Giganet services in multiple markets. Business services is on the cusp of hitting 2 billion in growth. Customer relationships. I found most of the results, we are growing customer relations. There is a lot of great indications in this industry that the future is very, very bright and we should be excited. We have technological change to deal with. We are going to grapple with that as we go along. We are going to take a couple steps forward and back as we go through this process. We have amazing networks, well all know that. Powerful networks over time becoming more powerful. Mike we have great content relationships. Together we spend billions every year with great content providers. What we missed is, to use an overused term, is the app. The app that allows that content to be accessed easily, seamlessly on multiple devices by kids, consumers who want it simple. As we invest, all of us, we are for sure, in that app experience, if we saw the big series of issues that were good conversation, millennials, kids dont like cable. Put the bill aside the experience can and should be incredible. And will be. We are finding our customers with verizon go, they dont go anywhere. They keep using infinity. It didnt go anywhere. If it works well its beautiful, simple, we aspire to be like the great Consumer Companies we know exist in this industry, we got it. Julia we are out of time. Jim, you are nodding. I know you have been working outside the traditional cable system with your new introductions. Do you care about selling traditional cable tv or is it all about broadband . Jim we look at traditional tv, we look at it like a convenience store. Its the milk and eggs. You have to have it. For the future of cable vision, the well continue to innovate in that space and continue to offer those products in multiple ways including to millennials who only watch an hour of tv a day. What we know is most important to them is connectivity. Thats where we are going to focus. We are going in a highly competitive market and we want to be the dominant provider. We are going to focus on what people want the most. Julia unfortunately we are out of time. Certainly fascinating Tipping Point for the industry. In terms of all the new products and interfaces you are offering consumers. Thank you so much for joining us today. [captions Copyright National cable satellite corp. 2015] [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. Visit ncicap. Org] now, ladies and gentlemen please welcome our next panel which will also be moderated by julia. First, the chairman and c. E. O. Of showtime networks, matt blank. Next the chief executive officer of f. X. Networks and f. X. Productions, john landgraf. The president and c. E. O. Of a. M. C. Networks incorporated, josh sapan. Julia thank you guys. Im sure you were listening backstage and theres all talk about over the top and how the cable carriers arent worried about board cutting because they sell broadband. For you you have to think about cable, carriage of your charges. Both for retransmission fees, also for advertising. How worried are you about this . Matt we need to grow our business. The traditional distribution business is very mature right now. I think one of the key sound bites of this past week was in the comcast earnings where they announced that they now had more broadband subscribers than video subscribers. There is a very clear message there. For us new distribute is distribution is all critical. We intend to grow households. We need new way foss do that. Ways to do that. I wouldnt say we are worried about core cutting. There is a lot of opportunity in a lot of different corners in the marketplace to grow showtime. Julia what do you think . John we need to get to the consumer. I think cord out cut something a terrific catchy term. I think its not as ubiquitous as people think it is. What is true and reflected on the Previous Panel is the interface by which people find and consume Great Stories and great content is shifting over time. And essentially what we are all working towards is having interface thats comparable to the best interfaces anybody could feel. Julia you must be watching a lot of hbo now. What do you think . Josh i think the Previous Panel who was encouraging to me because i think the changes that are being made are intended to sort of free up consumers from filling obligation, and i think when they do that its a more pleasurable experience its more fun. I think a lot of that stuff which sounds disruptive and different can recapture the imminimum wagination of the consumer and he or she can feel better about what they buy and have more flexibility. And i think focus on the app i think interfaces are not really faceless. They are fundamental. When you get a great one, you just love it to death. And if you combine that with the feeling that you can get what you want, and i think cable vision is doing that, when you want it, i think your motivation increases. I think you actually consume potentially even more. I find it very encouraging. Julia the question for showtime f. X. , and a. M. C. Is whether you want to go directly to consumer. Showtime is working on an app. Can you give us updates . Matt we have been talking to everybody. Most importantly i spent a good part of the past two years talking to the heads of every Cable Company about the math of bringing showtime to the current distribution universe via broadband. Thats a good place to start. We think theres a lot of opportunity out there. We are going to take advantage of it. The question is when is the right time . Who are the right players . And thats something i think well be talking about shortly. Julia hbo has been in the market for about a month. We dont know exact numbers, but it sounds like its off to a good start. Do you think there are any lessons to be learned from how thats been lodged . Matt to finish on that. The one tremendous advantage we see, we have begun to see it with showtime any time is consumers are getting used to buy all sorts of products, whether its an uber ride, movie ticket, dinner delivered with really excellent consumer interface. Thats something as an industry we havent really experienced until in our case we have been able to bring an application like showtime anytime out there. You see what the difference is when you can present your product with an interface that is consistent with the types of products that are being consumed due to all the changes in technology. And thats a big deal. Josh the number of broadband only customers wasdy min must, and now its a large enough share of the market that each of us who has a National Consumer band and these are three great consumer brands, have to Pay Attention to that smaller segment of the market thats still that is now only broadband. John we have to figure out a methodology. I dont want to discount the pathway through our existing relationships with cable operators, who are also in the broadband business. The truth is the sim pea kwlotic relationship between symbiotic relationship between us has served well for a long time. We have a problem. We have a group of 10 million homes and its going to grow to 20 million by 2020. And we got to figure out how to get there. Certainly direct to them is one path. Theres also a path that goes through broadband and just as an evolution of our existing relationships. Julia i can also watch, i watch all of your shows, can i watch them on your networks, also sometimes, on netflix or amazon. There are all these new ways one can consume this content. Do you see that leading into your core subscriber number . John i think you can see there is a lot of consumption of the very best content. I think that our three brands have a significant percentage of the very best content. Unfortunately for us we also own a lot of that content so we benefit from the consumption thats happening after our market. We have been focused very aggressively at preserving the first window for our cable partners, and providing really good we have the stacking rights, in season, full episode rights of all our shows. 20 original series. We are focused on providing them through apps, as well as our own apps. On the other hand, theres tremendous value in that backend marketplace. Its largely replacing syndication. Julia it sounds like for you ownership of that content is really integral to your strategy. John we started f. X. Productions more than a decade ago. If we were in the business of renting programs as opposed to programming, licensing as opposed to owning it, i dont think we could make the numbers work. But the ownership turns out to be a great business on a domestic and global basis. We have businesses very good at marketing and launching those shows and owning them is a boom. I would have no objection to seeing the back end rights of our shows captured by our own programming service, our brand, in the way hbogo captures the back end rights of its programming. I would have no objection to recapturing those rights inside the system if there was an economic pathway to doing it. Ultimately, we are in Business Partnership with content creators. And they are going to go whether they are going where they are going to get the most creative freedom and marketing. The bottom line is those syndication revenues, are absolutely critical to compensate. Julia a. M. C. Is unique in that you have this walking dead behe mooth. Behemoth. This has been a real driver of live programming. Walking dead has been very unique in that live programming. How do you encourage that or drive it or keep that show live . What is that value of that live event . Josh in the current advertising regime, and may further undergo modification, its how the money flows. The underlying phenomenon of watching when something is scheduled, when there is all these opportunities to watch at your own choice on various different machines, is a curious one and i think we are seeing this effect thats both in empire at the moment and walking dead which is increased ratings at 10 00 p. M. Every sunday. A thing seemingly of the past. Its occurring now. I think it is i think its to some degree in response to a greater growing trend of people watching alone on a machine and bingeing and taking advantage of all sorts of improvements, but it does miss out on community. So theres a big lot of fun, of course when you watch the super bowl live, or the academy awards, but there is an awful lot of fun when you watch the walking dead, and the show after it and you tweet. And i think youre seeing that experience in empire. Of course you are seeing certain broadcast networks trying to take advantage of literal live with theatrical productions. We saw with sound of music and peter pan. I think there is an oddly Bright Future that will be defined with greater specificity about what wins at a time slot. But there is a totally cool time slot win thing because its in service of people being together. You got to hit it right. It zigs against zag of ondemand. I think its a pretty rich opportunity. Julia relationship . Matt first, go back to your question with john. Looking at this environment with netflix and the competition in the home, we see something its the pore things change the more they stay the same. We have seen this heavy user dynamic in our business for the better part of 30 years in multipay. Certain households just want everything. Now when we look at hulu, netflix, amazon prime we see they index very high in our homes. So you can take a glass half empty or glass halfful. The half empty would be gee how are you going to compete . The halfful, which i prefer, we are seeing these heavy users and we are fortunate to exist in that very precious space where that audience is saying, give us more. Give us more of this great serialized dramatic content. As much of it as we can get. The advantage we have in particular not being in advertising driven environment, is that we dont care how somebody watches something. And the example i always use is dexter which has been off the air for about a year or so but 10 years ago we launched dexter, 2 3 of the viewing was live on sunday night and a third was delayed through other vehicles. When dexter went into the final season a year and a half ago, it was a complete reverse. A third of the viewing was live on sunday night and 2 3 of the viewing came on demand, d. V. R. , other places. Yet in that final season we had three times the viewing we had in season one. So that says our ability to use this technology to manage through these platforms creates tremendous value for a showtime subscriber. Julia do you think there needs to be a shift in measurement when you are trying to negotiate with advertisers . How broken is the Measurement System . John its different. Its more difficult than that in the sense than the fundamental advertising model is due for massive reinvention. I think ultimately what the consumer is telling us is that they are not willing to give us 15 minutes of their time to watch a 45 minutes of our content. I think they are willing to give us quality time for a relevant ad and also im actually very bullish and excited about the advertising business ability to reinvent itself over time. But that said the viewership of our shows has gone up. When you count all those various different streams. And ultimately while we have an advertising issue thats, i think, going to be very dynamic, very transformative marketplace, its going to be different five years from now than it is now, i think the business of making Great Stories that engage consumers and being paid for those could stories is as good as its ever been. I dont see it going anywhere. Ultimately i think all this comes back to creativity and storytelling. I think that the mode of interaction is vital to the consumer, but no one is going to be able to corner the market on great storytelling. It refuses to be corralled into one single bucket. I trust that you could come back here in a decade and these three brands will still be very healthy and there will be other brands that are very healthy today that will also be healthy in 10 years. Julia i want to hear about the content, decisionmaking topics. On the ad topic whats your outlook this year . How is it going to handle the fact there are these other competitors like netflix . Josh there is an evolution under way. It is an evolution. There is the appeal of digital, which has notwithstanding some measurement issues associated with it, i think it has some precision thats advantageous. Some of which is actually coming into the Cable Television advertising organization. And it is getting much more specific. And the data opportunities for being able to sell someone who wants to sell a product are improving dramatically. And so it wont be like it was. It will actually be tremendously more efficient for people who spend their money. Thats really occurring as a consequence of all the data thats being collected and now organized and seen most specifically through settop boxes of cable systems. I think thats really a great tailwind. I think ill echo what john said. I 24i there are certain shows that i think there are certain shows that are so popular and have so much inherent appeal, they really do have high engagement. If you think about what your favorites are, and you think how much youre like your favorites, i weighted with phenomenal waited with phenomenal anticipation for the comedians, watch the First Episode of the affair and fell in love. I value those. Im watching with rant attention when that stuff rapt attention when that stuff is on. Thats not lost on people who spend money. When you have things that are favorite, i think you have something thats unique and premium. When you combine that with improving analytics, you