I’ll admit that I’m a big fan of the Weather Channel. I’ve got two channels at home (regular and weatherscan), web bookmarks for frequent travel destinations, and two mobile bookmarks (regular and iPhone). Earlier this week, the brand/channel agreed to an LBO of $3.2 billion, less than the original target of $5 billion, and will be managed by NBC Universal.
I’m not in the weather business (just a fan), but I think this deal makes sense beyond the eyeballs and ad revenue that media outlets seem to be reporting on. See, earlier this month at one of my speaking gigs, I had lunch with someone from NBC, who gave me a different perspective on this [potential at that time] deal than what you may be reading about today.
Before we go there, let’s take a step back. The other buyers involved were Time Warner, CBS, and Comcast. Two publishers and a MSO moving boldly into content. So NBC seems to fit in the former category. But that’s only a slice of the picture. From a media perspective, adding the Weather Channel makes sense, but their problem is that consumers don’t spend a lot of time spent on site/channel. However, they get lots of eyeballs, meaning lots of ad impressions/revenue. (An old/traditional model way of thinking. In other words, doomed.)
Back to lunch. So we’re talking about weather and advertising and some of the possibilities when you combine the two. Like an airline with banner ad inventory that could show skiing ads to someone who looks up a ski destination, or a Caribbean vacation ad to someone seeing snow in the forecast. [yawn]
It would take a whole lot of uber buttons, 30" spots, and mobile text banners to make that $3.2 billion pay off.
Who’s NBC’s parent company? Oh yeah, General Electric, the world’s largest
conglomerate. So here’s where things get interesting. The potential value behind the Weather Channel lies within using its data to improve all of the other businesses within GE. Sure, all of those advertising applications are interesting, but there’s a lot of money in helping the transportation, energy, aviation, finance, etc. businesses more intelligent by better understanding the weather and how it impacts businesses on a current and forecast basis. (Get the Corporate Audit Staff on this one right away, Jeff.)
At least that’s the opportunity, "weather" or not its full potential is realized. I wonder, is there any data that you have hiding in plain sight that could help dramatically improve your business? It could come to you as simply as making small talk about the weather.