Finance boss Charlie Bracken tells Oliver Smith why content is king
With a cable network connecting over 24m households across Europe, a figure that will jump to 28m when its €10bn (£8bn) takeover of Netherlands cable operator Ziggo closes later this year, finance chief Charlie Bracken believes that content is fast becoming the new telecoms battleground for Liberty Global.
“We own the network, but we’d like to have a view on what content is going to go through the network,” Bracken says. “We’ve built this big footprint and now we are looking at how we defend that, and that’s why we’re looking at content businesses.”
Less than a year after it acquired Virgin Media in a £15bn deal, propelling Liberty to overtake Comcast as the biggest cable company in the world by subscribers, Liberty is on the deal trail again, this time looking to invest in European content businesses.
“We will continue to use deals as a way to try to build value, but we’re not in love with deals for deals’ sake. If the right transactions come up we will look at them... especially in the areas of content and maybe in mobile,” says Bracken.
Liberty made one of its first big bets on content in May, when it teamed up with US media firm Discovery Communications for the £550m takeover of All3Media, the UK creator of shows like The Only Way Is Essex and Hollyoaks.
“In our mind the UK has become almost the capital of European content so we have just invested in this business All3Media, one of the biggest independent content producers.”
Since 2011 Liberty’s deal-making spree across Germany, Poland, Belgium and the UK has boosted its total combined revenues by nearly 60 per cent to $14.5bn last year, with an operating cash flow of around $6.7bn.
Recent reports say that Liberty could be looking to work with Discovery again, this time in a joint $4bn bid for a 49 per cent stake in Formula One.
“It’s no surprise we’re interested in any sort of premium sports that would be in play. Formula One is a very well--watched sport, 450m consumers watch it every day,” says Bracken. “Of what we show on our TV networks, the most-watched sport is football and the second most-watched is Formula One, so of course we are interested in what’s going on with it.”
While Bracken sees sport as a key battleground, there are some fights that he doesn’t think Liberty should get involved in, like the escalating tensions between BT and Sky over football.
“Here in the UK football is the key driver and BT and Sky seem pretty determined to scrap over it... so I think we’ll let them get on with it.
“We are interested in trying to create a European content champion, because at the moment content is dominated by the US. We are believers that Europe could become a large scale content continent in its own right,” he says. “There are 180m TV households in Europe compared to 110m in America, so there’s no reason why we can’t create a market to rival the US.”
While working to build Liberty into a European content champion, Bracken also hopes to further establish the business in London where its global headquarters is based. “London is the capital of Europe. It’s certainly the capital in terms of business we are heavily involved in, the content businesses we are interested in getting involved in and certainly in the financial business including dealmaking.”
In the meantime Bracken says he will continue chasing after the deals that have made Liberty the telecoms titan it is. “One of the guys who helped found this company, one of these cable pioneers, once said ‘a company that doesn’t grow dies’. I think it’s interesting to work for a company that is constantly growing. You don’t always grow in the right direction and you don’t always get it right, but it’s much more exciting to swing the bat than sit around and hope for the best.”
CHARLIE BRACKEN CV
- Born in 1967, Charles, or Charlie, Bracken later went to Cambridge University before joining Goldman Sachs in 1994, becoming exec director of communications, media and technology.
- In 1999 Bracken joined United Pan Europe Communications as finance chief before becoming finance co-chief of its parent company UnitedGlobalCom in 2004.
- In 2005 Liberty Media International and UnitedGlobalCom merged to become Liberty Global where Bracken became finance chief.
- Bracken is also chairman of the non-profit charitable organisation Lessons for Life Foundation, which raises money to fund the education for HIV and AIDS orphans in sub-Saharan Africa.