YouTube Chief Business Officer Mary Ellen Coe On NFL Sunday Ticket “Exceeding Expectations”, Unexpected Disney-Charter Plugs & More
Mary Ellen Coe was installed as YouTube‘s Chief Business Officer last fall, just as the activity level at the company was beginning to surge even by the breakneck standards of a startup-turned-digital-behemoth.
Since she landed in her new role after a 10-year run at Google and a prior chapter at McKinsey, many major headlines have blared. The company secured NFL Sunday Ticket in a $14 billion, seven-year rights deal that kicked off this month. YouTube TV, now a top-5 U.S. pay-TV operator, got an unexpected boost from Disney‘s battle with Charter over carriage on Spectrum TV. YouTube Shorts passed 50 billion daily views less than two years after its global launch. And on the corporate front, a leadership shuffle saw Susan Wojcicki hand the CEO baton to Neal Mohan and Robert Kyncl depart after 12 years and become CEO of Warner Music Group.
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During a recent visit to YouTube’s offices at New York City’s Pier 57 for the company’s annual creators event, Coe sat down with Deadline to discuss a few of the many initiatives in her portfolio. The following is an edited transcript of the conversation, edited for length and clarity:
DEADLINE: As YouTube has evolved and moved deeper into parts of the traditional media business, the creator community remains a central, signature element. Can you talk about the role their content plays overall and how it fits in strategically?
MARY ELLEN COE: From a business vision perspective, creator- or user-generated content is special to us at YouTube. It is the biggest differentiator on the platform. I’ve spent a lot of time with the NFL, and with media partners, and with music partners, and all of that has to be balanced with what’s happening with user-generated content, because that is what our users uniquely come to YouTube for. Take the living room as an example, our fastest-growing surface. Shorts is the fastest-growing format there. So, our users are expecting that level of innovation, and kind of to see a continuous stream of new ways that creators are telling stories. That’s what keeps it inventive, and you know, it’s almost like there’s always a rising expectation for unlocking all of that potential. It’s the scale and it’s the amplification of all of that content.
DEADLINE: You guys made an aggressive play for Sunday Ticket, which gives subscribers access to network broadcasts of every Sunday afternoon game regardless of their local market. It’s the first time a pure streaming entity is offering it, which has caused excitement in some corners and a little anxiety in others. Now that it’s up and running, what can you say about how it is performing? Is it meeting expectations?
COE: Let’s talk product experience. The feedback has been incredible: reliability, low latency, and Multiview. Multiview [which allows viewing of four games within the frame of a single screen] has been the biggest hit ever. So, great fan engagement on the experience. In terms of subscriber momentum, it’s exceeding our expectations. So, we feel great about the subscriber trajectory. And then we had a lot of [co-marketing] partnerships with third-party partners like Verizon, Comcast and FanDuel. So, we’re actually feeling really bullish about how it’s trending, but we’re not out of the sign-up window. So, we’re two weekends in, and you’re still going to see a ramp, but we’re excited for the first year.
DEADLINE: With these kinds of full-season packages, a lot of times there are discount offers for prorated subscriptions with a smaller number of games left. Are you planning those?
COE: I can’t preempt any plans that are happening, but that’s something that’s in the mix. Ultimately, we want to make sure that pricing is relative to what the user-value proposition is.
DEADLINE: Since you mentioned the fan feedback, one thing that’s come up is that people want to be able to select the games in Multiview themselves instead of YouTube picking them. Is there an official response to that request?
COE: That is a very hard thing to do technically. Put it this way, the feedback is, we hear you loud and clear. We have a seven-year relationship and will be looking to innovate in the future.
DEADLINE: Got it, OK.
COE: And one thing that we’re doing to address that is, we have a lot of insights on the game combinations and what matchups fans are interested in. So, we can use those insights.
DEADLINE: Meaning, essentially, that you don’t just automate it or jam the four games in there that the league or owners or networks want?
COE: Not at all. In a sense, you don’t need to provide infinite combinations. We actually will have insight into what are the games that are the must-watches, and then we can preload those combinations. I think as you see the season go on, the demand [for customization] will become less, because people will see the combinations they want will be up.
DEADLINE: At the start of this football season, a carriage dispute between Charter and Disney kept a lot of early college games and Week 1 of the NFL off of Spectrum TV in large swaths of the country. YouTube TV, which had more than 5 million subscribers in 2022 by your most recent official estimate, got a rare plug by both companies as a solution for frustrated customers looking for their games and shows. By promoting services like YouTube TV, Charter says it was able to keep broadband customers even though some moved their TV service to you from Spectrum. Did you see a subscriber bump during that period?
COE: Here’s what’s interesting, it was right during the Sunday Ticket ramp. We’ve not yet looked at it as to how those two things are related. We’re having incredible growth because of the Sunday Ticket relationship with YouTube TV. It is interesting that both Charter and Disney referred to YouTube TV as a place to go when they couldn’t get content. I think that’s an endorsement for the user experience on YouTube TV, which we appreciate.
DEADLINE: Prior to the Charter-Disney situation, YouTube TV implemented a price hike, going to $73 a month from $65 for your base plan. Typically in these situations, a number of customers react by canceling their service. Did you see that initially or has some of that churn been offset by the NFL given that YouTube TV subscribers get a cheaper rate for Sunday Ticket?
COE: The growth on YouTube TV is robust, and we attribute that to, you know, there was a real purpose for the NFL partnership, and there was a real purpose to when we started with the NFL. We said, ‘It’s really important to us that we integrate with creators.’ So, that’s a big feature to every weekend. You know, we have full access to creator on the field, behind the scenes, et cetera, and it’s been a big feature, too, it’s really drawing fans into YouTube TV. And by the way, this was interesting: We announced the price increase when we announced Multiview, which was heading into NCAA March Madness. And we had an 800% increase in call volume, and it was 80% attributable to Multiview.
DEADLINE: The internet pay-TV bundle sector has stabilized a bit but some early players are gone and overall cord-cutting is continuing. While you’re the leader, skeptics note that programming costs money, especially sports, so they say you are going to keep passing rising expenses on to the consumer. In the interest of transparency, I am a paying YouTube TV subscriber and have also covered the business since it launched in 2017, right across the street at Chelsea Market. So, the question that comes to my mind is: How do you avoid squandering all of its technological innovation and let this become just another TV operator annoying customers with higher rates?
COE: Well, let’s hit the price point. I thought it was interesting, the media covered the pricing on Sunday Ticket, and nobody reported on the all-in cost of a two-year contract, a dish [for DirecTV, the satellite operator that launched Sunday Ticket in 1994] and Sunday Ticket on top of that. You know, I think the saving to the user is 45% reduction in price, signing up with YouTube TV. So, we actually feel great about the value, and I think the growth speaks to the value the consumers see. Now, to step back to the broader platform, so much of the content that our users want to see is what you only uniquely find on YouTube. So, when you’re in the living room, and you can be in the app, and you are watching Shorts, you’re watching MrBeast, or you go to Primetime Channels, and you pull up Sunday Ticket, or you pull up Paramount, or any other partner, all the content is there that you want to access, and that is uniquely to YouTube.
DEADLINE: I am glad you’re bringing up the relationship between YouTube TV and YouTube writ large. On the YouTube TV side, you have programming contracts to honor, so you need to maintain a wall between the vast, free, ad-supported world of YouTube and what subscribers pay for on YouTube TV. In the future, though, could there be a far different-looking bundle? MrBeast’s audience, since you mentioned him, is exponentially bigger than that of a lot of the cable networks you’re paying to carry. Maybe his channel will get swapped in for a lower-tier cable network?.
COE: Here’s how we think about it: The consumer ultimately will decide what do they want bundled and what do they want unbundled. We’re going to let them make the choice, and they can choose to find that however they want to, and we’re going to make a great experience in both.
DEADLINE: YouTube TV already knows my favorite TV channels and serves them up to me on the home screen. Will it start to incorporate a dashboard of the YouTube channels I subscribe to, all integrated together within the same app?
COE: I’m going to give this feedback to our product team, and you might at some point see that evolution.
DEADLINE: I can’t be the first person to have wondered this!
COE: I mean, you know who our partners are, and what those relationships are like, and you know our user experience, clearly YouTube TV is a very special experience because the subscriber growth has been phenomenal. But we don’t want that to have to be the only experience, so that’s why we offer things like NFL, Paramount, all these partners in Primetime Channels. If you want to be à la carte, and if you are a DirectTV subscriber or a Comcast subscriber, you can easily do that. We actually did integrations with our partners so that they could actually advertise YouTube as part of that. So, I think it’s a follow-the-user story. For our partners, it’s a look at the array of business models for you to find audiences.
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