Good day, ladies and gentlemen. Welcome to the Q4 2012 Discovery Communications, Inc. Earnings Conference Call. My name is Charlene, and I will be your operator for today. [Operator Instructions] As a reminder, this call is being recorded for replay purposes. I would like to turn the call over to Craig Felenstein, Senior Vice President of Investor Relations. Please proceed.

Good morning, everyone. Thank you for joining us for Discovery Communications' Fourth Quarter and Full Year 2012 Earnings Call. Joining me today is David Zaslav, our President and Chief Executive Officer; Andy Warren, our Chief Financial Officer; and Mark Hollinger, President and CEO of our international operations. You should have received our earnings release. But if not, feel free to access it on our website at www.discoverycommunications.com. On today's call, we will begin with some opening comments from David and Andy, after which, we will open the call up for your questions. [Operator Instructions] Before we start, I would like to remind you that comments today regarding the company's future business plans, prospects and financial performance are forward-looking statements that we make pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are made based on management's current knowledge and assumptions about future events, and they involve risks and uncertainties that could cause actual results to differ materially from our expectations. In providing projections and other forward-looking statements, the company disclaims any intent or obligation to update them. For additional information on important factors that could affect these expectations, please see our Form 10-K and subsequent filings made with the U.S. Securities and Exchange Commission. And with that, I'll turn the call over to David.

Thanks, Craig. Good morning, everyone, and thank you for joining us. 2012 was another year of successful operational execution and strong financial results for Discovery as we delivered sustained growth, further invested in our global brands and content and developed new and diverse strategic opportunities around the world. Since becoming a public company in the fall of 2008, Discovery has demonstrated a unique ability to generate healthy and consistent returns, capitalizing on the sturdiness of our business model, the widespread appeal of our content and the unparalleled global distribution platform we have built for more than 20 years. As technology rapidly evolves and economies ebb and flow, Discovery's underlying focus remains exactly the same, delivering long-term value by creating the highest-quality content with great storytelling and compelling characters that can be leveraged around the globe and across a growing number of digital and consumer platforms. Our targeted investment strategy emphasizes geographies and brands that offer meaningful advertising and affiliate upside, a key factor in our strong and dependable growth over the last few years. The success of this strategy was never more evident than in the record results we delivered in 2012, which were driven in large part by the market share gains in the U.S. and around the world as we strengthened our existing brands, such as Animal Planet and ID; launched new brands, such as Destination America; and extended strong brands globally, such as ID in Latin America and Discovery Kids in Asia. Domestically, this was our fourth consecutive year taking market share as viewership across our portfolio was up 6%, and our best-in-class ad sales team translated the larger audiences into double-digit ad growth, excluding one-time items. This growth speaks partly to the strong ad market, but also to the breadth and depth of our brand portfolio…

Thanks, David. Discovery produced another strong quarter of operating results during the fourth quarter as we leveraged the large audiences we're generating around the globe to double-digit worldwide ad revenue growth and the increasing subscriber base we're delivering outside the U.S. into double-digit international affiliate revenue growth. On a reported basis, total company revenue in the fourth quarter increased 8%, led by 15% international growth and 4% domestic growth. Organic revenue growth, where it excludes the impact of foreign currency movements, as well as nonrecurring ad revenue and additional licensing revenues in the prior year, was up over 10%. Total operating expenses on a reported basis increased 6%, higher than previously anticipated, primarily due to strategic transaction costs, a greater impact from foreign currency movements and increased marketing and personnel costs. Excluding the transaction costs and the impacts of foreign currency, as well as higher content costs a year ago from impairments and changes in amortization rates, total expenses increased 8% versus the fourth quarter last year. Discovery's continued ability to generate revenue growth in excess of expenses translated into a 9% increase in reported adjusted OIBDA during the fourth quarter. Excluding the impact of foreign currency, as well as the previously highlighted revenue and expense items that are onetime in nature in both the current and prior year, organic adjusted OIBDA grew 12% versus the fourth quarter a year ago. Net income from continuing operations decreased to $224 million as the strong operating performance in the current year and improved equity earnings were more than offset primarily by higher taxes, as well as increased mark-to-market share-based compensation expense through depreciation in our share price. The increase in book taxes versus a year ago was predominantly due to $112 million of foreign tax credits recognized in the fourth quarter of…

[Operator Instructions] The first question is from the line of Doug Mitchelson from Deutsche Bank.

David, do you see any other interesting acquisition opportunities right now? And for 2013, from your viewpoint, what are the most important execution priorities? I mean, where could -- you laid out your guidance and your outlook. Where do you think there's a potential to do better, where you think there's the risk of doing worse?

Okay, thanks, Doug. In terms of acquisitions, we have a great balance sheet. And we have a real opportunity with our existing platforms to grow organically, and we've been doing that over the last several years. The idea of buying additional assets is we're always opportunistic, but we were looking for the past 6 years, and it took us 6 years to find Eurosport and SBS and Switchover. The real focus for us is we're only going to do an acquisition if we think we can grow as fast or faster, as well as having real strategic value for us. So we will continue to look. If we find assets that meet that formula, we'll go ahead. But in the meantime, though we have -- we've expanded our platform dominance. And we're doing a better job, I think, than we ever have creatively in terms of populating our channels with great storytelling and strong characters and growing our market share, so I feel like we're in very good shape right now. And we'll see if anything else comes up. In terms of priorities, I think the #1 priority is to continue to grow market share. We are unique in our approach. And in the last year alone, we increased our investment in content by $200 million. But we did grow our market share last year by 8% in a market that was flat. The year before, we grew 3%, and the year before, we grew 7%. So as we look at this company, the focus is to continue to deploy capital to take full advantage of the fact that we have 14 channels here in the U.S. And as you look around the world, we have better -- we have a better platform portfolio than anyone. This past year, we grew 25% market share outside the U.S., including launching a number of new channels, where we're using our existing content. And so if we can continue to grow our market share and continue to create an environment where we have the best creatives working with us to build our brands, you're going to see a significant amount of growth because there's more and more windows for our content, and there's more and more platforms for us to put it.

Does that suggest that you should be ramping your investment in content even further than you already are?

Well, last year -- we've taken it up significantly over the last 5 years. And because we had so much success last year, as you look at Discovery, Animal Planet, ID, TLC, the success that we've had, including at Science, we have a lot more returning series than we've ever had. And returning series that are really, that are freshman or sophomore. So we don't have a lot of older series in our portfolio right now. And so because of that, you will see this year that we'll be relatively flat. And that will be significant because we won't have to go out fishing as much to find new content for 2 reasons. One, our creative team, I think, is better than we've ever had, and we understand our brands and what the viewer is looking for on each channel. But also more importantly, we have a lot of returning series, more than we've ever had, on each channel. So we're in this odd moment where we could spend about the same amount of money and get a lot more creative content because remember that within our business model, when we have series that work, we own those shows for the long haul. So the additional costs of those shows in Season 2, 4, 5 is -- there is no opportunity to come back and really leverage those, and so that's a real opportunity for us. So it will level off, Doug, and I think that, that will help with -- you see a big pickup in amortization this year, you'll see that level off significantly because we're going to be tapering down, but I think we'll taper down and we'll accelerate market share.

The next question is from the line of Ben Swinburne from Morgan Stanley.

I wanted to ask about the distribution renewals that you talked about, Andy, in your prepared remarks. Now that they're behind you, can you tell us how many subs they covered and whether you expect, if you sort of cut through all the noise with digital and launch amortization, if the affiliate revenue growth will accelerate in '13 versus '12? I think it was around 5% in '12. And, David, what was the strategy going in, I think Andy mentioned more distribution, higher fees. But there are a lot of things you guys could go for, more ad inventory, higher fees in ID in particular, and you had a lot of ratings strength. What was the sort of goal for the team going in other than just getting as much money as possible?

Thanks, Ben. I do think we're very well positioned for these discussions. Six years ago, our market share was about 4% on cable. Today, it's about 10%. We have a lot more channels that are -- that have niche audiences, that are -- that feel that our channels are very -- and brands are very important to them. So that -- and all of our deals come up at the same time, as we've discussed. So I think we have a very good hand. We also have a very good equitable argument with distributors because we've spent a lot more on content as our market share -- has grown. And I think all of our distributors would agree that our channels have become much more important. The viewership is up, they are making more money selling them. So it was a very good backdrop. For this year, there were just very few deals that came up. We said the deals were going to be coming up over the next -- last year and over the next 5 years. This year, it was a smaller percentage. And so we did very well in terms of getting increases in fees, well above where -- what are -- what's in our existing deals, which is 4% to 5%. In addition, we were able to get more distribution for a number of our channels, which doesn't -- which helps us. When you take a look at ID, that was in 55 million homes, and it's now in over 80 million. That's becoming a big asset for us. Science, that was in 45 million homes. That's in over 70 million now. So we get the increase in rate, we then get paid on those channels that get rolled down, and then we get additional ad…

So it sounds like these deals set the stage for that 5% to accelerate, but it's going to take multiple years as it phases in as the deals get bigger. Is that a fair takeaway?

Correct. And now having said that, if TV Everywhere -- we could do TV Everywhere this year as a separate basket of consideration. Or there could be deals that are up next year, the year after, in 2015 or '16, where a distributor wants TV Everywhere rights, where we could either do it independently, or we might decide to roll forward a whole new deal as part of that. But assuming that, that doesn't happen, then it'll feather in over the next couple of years.

Our next question is from the line of Todd Juenger from Sanford Bernstein.

Just a couple quick ones for you. So in terms of international advertising, in the past, you sometimes have been willing to talk a little bit about Europe specifically. Obviously, a lot of stuff going on there, including your free-to-air launches in the macro environment. I wonder if there's any comments you'd be willing to make about how that all came together for you in the quarter and what you're seeing for the year. And I might as well ask my follow-up quickly, and it's more a tidy -- a housekeeping one. On your guidance for the first Q [ph] of '13, it looks from the interest expense as if your debt seems to be more or less keeping flat. I'm just wondering what your thoughts are on leveraging the company going forward and if I'm interpreting that correctly, or why you wouldn't raise the debt level commensurate with the EBITDA growth.

Thanks, Todd. I'm going to give a -- just a quick on international and then pass to Mark Hollinger, who's the CEO of our International business. We had -- you saw we had 18% growth in advertising. The fact that we're in 210 countries, yes, there was some softness in France and Germany, but on the other hand, we had so much market share growth, where we grew 25% market share that we were able to continue to grow. And you have subscriber growth in the aggregate of about 12%. So we have a lot of winds at our back. There's a number of markets, particularly Latin America and India and Russia, that feel a lot like the U.S. in -- back in the early '90s, where you're gaining market share, more and more advertisers are coming on, and we're well positioned. The reason we're doing so well in Western Europe is we have an odd and effective strategy on free-to-air. We use it as a compliment in a few markets, but we have existing content that's already paid for in-language, so we're really -- we get a broadcast network in a market that doesn't have high paid penetration. And then we're able to basically gain market share by putting on a lot of content at very, very low cost. But Mark's done a great job last year. I think we outperformed certainly our expectations, and we're accelerating now into 2013. Let me pass it to Mark.

Thanks, David. Yes, I think if you look overall, the ad sales growth for the quarter and for the year was actually a nice balance across a number of regions. Clearly, Western Europe was probably the leader of the pack, driven by a lot of the free-to-air initiatives. Italy, and Quest in the U.K. But I think if you look more broadly, you can see that there was strength in Latin America with Mexico and Colombia and Venezuela. There was strength in Central and Eastern Europe with Poland. And India ended up being a great story for us. So I think we found that with lots of different market dynamics in different places, that we're well positioned having the breadth of portfolio and frankly, again, the combination in markets where free-to-air can play a big piece that we have. We have the platforms to continue to drive double-digit growth on the ad sales side. Again, the pacing for first quarter is looking the same. It's a nice broadly sort of distributed pacing for first quarter.

The attractive piece for us is we're gaining market share around the world not just in channels but in viewership. And we're seeing, whether you call it softness or recession or weakness, in a ton of markets. Having said that, we're able to grow aggressively in -- even across a challenged environment. So Brazil still is growing strong in terms of subscribers, but the economy has been soft. And when those economies begin to turn, when you're seeing the kind of growth that we see right now with really challenged environments -- so our strategy is grow market share, do it inexpensively with a lot of in-language content. And we're very confident about the year ahead. But as -- if we can get a turn in some of these economies, then we can really -- we can see even more growth. Andy?

Todd, regarding your 2013 debt and interest question, as you've heard us say before, we're very focused on a gross leverage ratio of 2.5x to 3x. So given the EBITDA growth we are forecasting for '13, as well as the SBS transaction, we do think we'll have about $1 billion of additional debt, year-end '13 versus year-end '12, and therefore, about $50 million of additional interest expense as well in '13 than '12.

Our next question is from the line of David Bank, RBC Capital Markets.

Two quick ones. The first is, if you look at the success of Animal Planet versus -- and versus the success of ID and how you're monetizing both, are you -- do you feel like you are monetizing the audience increases in Animal Planet? I think to a certain extent, you've been going out of the typical demo in some of those audience increases. And so how is the monetization of that going, and is there like a transition period? And the second question is I guess as you have successfully hit, or look on target to hit, the guidance with respect to OWN and its breakeven point, at what point do you think it'll be time to sort of update the guidance, move out the targets and start talking about the positive contribution and giving us a sense of how that could sort of move the needle below the OIBDA line?

Thanks, David. Look, Animal Planet was really, I think, the breakout surprise for last year. With all of the effort that we made in -- over the last 6 years and even the years before I got here, it was a channel that everyone said that they loved but not a lot of people watched. And so we built a very strong creative team led by Marjorie Kaplan, and we invested money for the last several years trying to find the audience and grow the channel. And candidly, we had our ups and downs. But before this year, we were really struggling with how do we get this from being the #35 channel, #40 channel, in America to something that's more meaningful because we were able to get much lower CPMs on this channel, and the viewership has been low. And Marjorie has really broken through. This -- the channel is now a top 20 channel in America. On Sunday, Marjorie had 2 shows that were the top 20 shows. It was the #1 channel in our portfolio on Sunday. There's a number of series that have a lot of traction. The demo has converted from being more female to more male and young and quite attractive. The good news and bad news is we have a very good audience now, and it's compelling. It helps us strategically in fighting against the other non-fiction channels like Geo and HISTORY, both of which do a good job, but having a successful Animal Planet helps that. The bad news is that our CPMs are still low on Animal Planet. But the good news is that over the next 2 to 3 years, you'll see us continuing to get a premium and catching up. It's going to take some time. We're already starting…

Yes, David, just to give you some more thoughts on that. It was about a year ago that we said we would have funding in '12 less than '11. And as you said, the second half of '13 would be cash flow neutral. We couldn't feel better about the momentum and the results we have today. As David said, we achieved our financial objective for '12 funding, it was less than '11. And I've mentioned, we have -- really gives us a real line of sight to some very positive results out to 2013. So it is a big driver of our improvement. And EPS and the other income line will be significantly improved this year versus last. We will throughout the year give you all an update on the results, and particularly on the second half view, which we see now as being a debt reduction and a pay-down of our debt obligation, particularly in the second half of this year.

Our next question is from the line of Jessica Reif Cohen, Bank of America Merrill Lynch.

I wanted to go back to the affiliate deals. I know you haven't exposed a lot, but I was just wondering if you could give us kind of what percent of the contracts come up at the end of this year. Or if 2013 isn't the big year. Year-end contracts from 2012, you said, were small. When do we start to see -- what is the big year in terms of affiliate renewals? And within the rights again, David, you said you're not giving TV Everywhere, but you're giving VOD rights. And just the strategy of going for distribution, even with balancing distribution, increased distribution versus rates, I'm just wondering if you can -- I don't know, if there is any help that you can give us at all with the overall revenue growth on that side over the next few years, how much will it accelerate?

Thanks, Jessica. We've said -- we said last year that it comes in over 5 years and that it's -- there isn't any 1 year that has 60%. So we don't want to get any more specific than that. Our #1 focus is that the actual fees go up. And getting the fees to go up, which are long cycle, which we can bank, and that's the most important piece of the strategy, and we think given the fact that our fees have only been going up 5%, but our market share is going up more than that, our channels are more valuable and they all come up at once, that we have a good argument, and the operators that we dealt with this year agreed with us. Having said that, if you can pick up several million subscribers with a guaranteed sub fee against those subscribers, that becomes a guaranteed affiliate also, if assuming that those are -- that you're able to be moved down in a way that you would have never otherwise. So I think the second thing that we look for is to get more carriage for our channels with guaranteed fees against those, which when you put those together and you add them up, it adds to your overall increase in affiliate fees. There are a bunch of other things that you can look at, but those are the 2 biggest ones. And TV Everywhere and VOD, we've held back TV Everywhere. There are some distributors that are looking for SVOD to compete with Netflix, which is great for us. And I've always -- I've said recently, this is probably the best time to be in the content business because there's more players, more people that want to pay us for our content in more windows. The fact that some operators want to get into the SVOD business is another bite at the apple in addition to TV Everywhere, but we haven't given any SVOD rights, we haven't given any TV Everywhere rights, and we've given limited VOD, which has been our operandi from the beginning. Andy?

Jessica, we're clearly not going to give any forward-looking viewer guidance on how the affiliate growth is going to look. But 2012 was a good year. The growth of those deals was good. The standard distribution, as David mentioned, was good for us, especially on the emerging nets. So we're not going to give any forward look, but at least the first year of that 5-year cadence was productive.

And then you said long cycle, how long are the newer contracts?

Look, we don't -- we're not going to disclose specifically. But in general, our international deals tend to be about somewhere in the 3-year range shorter than the U.S. In the U.S., our deals have historically been in the 5-year range. There are some of the players in the market that we've seen have gone longer than that. It's something that we will look at, and whatever -- if, in fact, there is value there, we would go longer or we might go shorter.

Our next question is from the line of Michael Nathanson from Nomura.

Let me have one for Andy, and then I'll come back to David on affiliate fees. Andy, if you look at your domestic network profitability this year, it's kind of amazing. You converted almost every dollar of revenue incremental into profit. And I wonder, when we look at the recent trends in domestic business, what do you think is kind of the right range of incremental conversion of revenue, let's say in the next 1 or 2 years? So what's kind of the right way to think about that?

Domestic, Michael, would be probably in the, long term, 50% to 60% [ph] range, especially given the higher content amort that we talked about. Content amort, that catch up relative to the cash spend in the last couple years, as I said, it's going to be in the low to mid-teens. So that certainly will have an impact on that, but we still expect solid flow-through of margin domestically.

Okay. And then, David, just going back to affiliate fees. It's a good question. When you look at how people have done deals, some people have gotten big step-ups year one. Some other people have just taken the step-ups over the life of the contract. How do you think about that balance? Are you going for a big 1-year step-up or should we think about this over like the life of a new deal?

When we're looking at doing a deal, it's really how do we get the most value for our overall package. I guess our preference would probably be straight line. If a distributor wanted to give it to us in some other way because it was more beneficial, we certainly -- we could just tie in value back-end, front-end, to make a determination. The deals that we've done have been straight line so far. And so I think you'll see it flow in evenly.

So therefore, if you look at the step-up in '13 to '12, we can't assume -- that's just not -- that you can't assume really anything from like, hey, that's the 1-year step-up. It's going to be...

We didn't do any front-loading of anything so far.

The next question is from the line of Richard Greenfield from BTIG.

When you look at broadcast TV, it appears from the ratings that collectively the business is in serious trouble. And I think when you look at the success that shows on your networks have had in terms of 18 to 49 or even just broader demographics, things like AMC with The Walking Dead and FX have attained, we've -- there's been this like steady market share bleed between broadcast and cable, and advertising has followed. But we haven't seen any kind of big gaps in terms of change year-over-year. Is that a 2013 or 2014 event? Like what has to happen so that you see huge chunks move broadly in advertising? And when we look at networks like you have like ID, et cetera, when do we start to see much bigger-size movements?

Rich, it's hard to tell. I think that we have subscriber growth flat in the U.S. We have viewership flat in the U.S. The one win that we have at our back right now is the fact that there is still a 32%, 33% CPM differential between broadcast and cable. They do deliver, in general, a bigger audience, but that's becoming less and less so. When we put Gold Rush on, on Friday night, we're the #1 network in America. We beat the broadcasters. When we put on Honey Boo Boo or Breaking Amish or Long Island Medium on TLC, we could be #1 with women 18 to 34, 18 to 49. So clearly, the justification for the CPM differential is eroding. Having said that, these things take time. We haven't seen any significant step differential, but we have seen more money coming to cable, and we have seen that spread every year get a little smaller, which is to our advantage. That's the wind at our back. We're always making the argument that we're delivering bigger audiences and we should be getting more money. Alebrije [ph] does a great job at that, and we'll continue to bang on that door. The good news is I think you'll probably see over the next couple of years that will be the sustained wind at our back as we continue to grow market share as an industry, that more of the dollar should come to us at some better pricing.

And then just a follow-up, when you look at all of the SVOD deals that have happened, have you seen -- obviously, Walking Dead has had these blow-out ratings from the leverage they've gotten from their viewership. When you look at this type of programming you've put up on Netflix and Amazon, can you point to shows that weren't as successful, where they've come back and been much more successful year-over-year, and you think you can tie it to the introduction of those shows in prior seasons to new audience members?

Here's what we've learned so far. Netflix and Amazon have been great partners for us. We have a unique deal with them in that our content -- the content we'd put on there is older. We were conservative coming in, but we did -- we were able to move a lot of content onto those platforms. And we put our brand on. Any time you look at a show from us, you'll see our brand. We spent the last 1.5 years taking a look at how is our content consumed and what impact does it have. The good news is we don't see any degradation. It's way too early to tell, but in our type programming, in shows like -- a show like Gold Rush or Deadliest Catch, there's an argument that people consume that, consume a whole season. They might consume a season from 3 years ago, and then they want to see the new season. So if anything, we think there may be a little bit of a helper with that, but I think it remains to be seen. The good news for us is that as our market share has grown, I think we've become even more attractive. As the number of hit series we have across all of our portfolio have grown, I think we've become more attractive, and it's been a very effective window for us. There are some series that surprise us. There's a couple of things that aren't on Discovery or TLC anymore that do quite well, and I think that falls into that kind of the campy -- it'll really surprise you sometimes what people will watch on a rainy Saturday afternoon.

The next question is from the line of Alexia Quadrani from JPMorgan.

Just staying on that SVOD topic right there. Could you give us a sense on how we should assume those revenues will fall in, in 2013? I believe you have the right to extend your deal with Netflix this year. Should we assume that's going to be in the numbers? Any color would be great.

Sure, Alexia, it's Andy. We do have a third-year extension on that, and the predominance of that revenue would be probably recognized in the second quarter, with some as well in the third. It really depends on the timing of when the content is delivered to Netflix, but think in terms of predominantly 2Q and some in the third quarter.

Do you think that the total then SVOD dollars could be up year-over-year in '13 versus '12?

We're not going to quantify specifically, but it's a significant amount, and it's certainly in line with the total SVOD in 2012.

Okay. And then just lastly, on the comments about the holding off the TV Everywhere rights, I guess what's the hesitation there? Is it waiting for the ratings to come in other media? And I guess what sort of holds you back?

Well it's 2 things. One, it needs to be -- we feel like it needs to be measured. So right now, if anybody is viewing our content, if we broadly deployed it and people were viewing our content on pads, it wouldn't be measured. So one of the attractions of TV Everywhere is that your content could be viewed on other platforms, but it is measured. It's measured by Nielsen, and you could accumulate the fair value for it. That's one. But two, if distributors are offering our content on other platforms, and the fact that they are able to do that enhances the experience that a consumer has with their distributor, whether it be Comcast or Time Warner or Charter, if in addition to getting their phone and their broadband, they also have TV Everywhere and they can watch on any device and if it has an effect on the way they feel about the distributor, if it has an effect on the churn, it's not clear exactly what the value is, but the value -- there is real value in us providing that, and the operators agree with that. And we just need to figure out how to apportion that value. And we haven't yet agreed on how to do that.

The next question is from the line of Alan Gould from Evercore.

Two questions. Andy, can you just give us an idea, do you have digital distribution revenue up versus 2012 built into your 2013 guidance? And, David, the ratings have been terrific. But is there any risk that you're going off-brand a little bit? I think of a show like the Amish show, for example.

Okay, let me start with Discovery. Because I don't think Discovery has ever been more on-brand. If you take a look, we have Africa running on Tuesdays, which is very core to what we are. We have Gold Rush, where we're going out to Alaska and learning about how to mine for gold. Moonshiners, we have a number of -- we have Curiosity on Sunday nights. So the balance of specials together with real series about adventure and survival, we're in this perfect balance right now. Breaking -- Amish Mafia, which is on Discovery, and has been very popular, it is on-brand. It's -- as you think about how people live in America and around the world, what are the different societies and subcultures, that's certainly part of it. But as you look at the bull's eye of Discovery, it is things like Gold Rush and Curiosity, as well as a lot of our Survival, which we still have and will have more of. MythBusters. So we feel right now that Discovery is in a sweet spot. We do have a great creative team. Eileen O'Neill, who runs Discovery and TLC, really spent -- she's been running it now for 3 years. It took about 1.5 years to figure out what is Discovery when it's at its best, who is the audience, how do we build it? And you saw our strategy of standing down during the Olympics and then coming forward with our best creative series after that. And we -- so far, it's been no looking back. Obviously, there's ups and downs in this business. And creatively, every show isn't going to work. But I think Discovery, from a brand perspective and from a viewer perspective, is the best it's ever been.

Alan, regarding your digital question, it is yet to be determined as actually which titles will be delivered this year. But broadly speaking, think in terms of a flat revenue, digital revenue in '13 versus '12.

The next question is from David Miller from Riley Caris.

David, just a question about the diligence process with regard to SBS and TF1 Eurosport. When you guys were looking into these deals and just doing your diligence and just kind of justifying the price that you paid, which obviously looks like it's just -- it's going to turn out to be super accretive. Was the thinking there that -- particularly with SBS, that some of these networks are broken and you could turn around the ratings with some of your library programming, and you could realize the upside there? Or was the thinking more that this is a macro call and that you're going in when obviously Europe just has a lot of structural problems, and hopefully, they kind of work their way through that and you can realize the upside there? Or was it a combination of both? Just interested in your thoughts.

Well, with both the Eurosport and in particular, SBS, we paid less than our multiple. We have 8 channels in Norway, Denmark and Sweden, so we have some synergy. We also have been in that market for 20 years. They're actually a great leadership team. They've done a good job of growing market share. And the markets are stable. Mark spent a lot of time over there. The deal isn't closed yet, but, Mark, why don't you give an update on SBS and Eurosport and how you see it?

Yes, look, I think with SBS and frankly, in the Nordics with the combination of SBS and Eurosport, we have an opportunity in, as David says, really great markets. Great pay-TV penetration, strong economies, economies that are well positioned vis-à-vis the rest of the Eurozone to really drive scale in a way that we have never been able to. The Nordics have traditionally been some of Discovery Network's highest audience share markets. I think we may have the highest audience share anywhere in our pay-TV world in Norway, for example. To be able to combine that with what SBS has done. And then also, potentially to bring Eurosport into the mix, from a sales point of view, from a content-sharing point of view, I think we see that there are sort of multiple upsides. It's not about things being broken. It's about I think bringing all those assets together in a way they can really drive growth. I think that there is probably in Sweden where TLC has been a bit under-distributed and where the SBS portfolio is smaller than it is in the other markets, but we do have a chance for a new channel or 2 in the Swedish market, which would be terrific. But this is definitely one where we have taken on great assets with a great management team in great markets. We think that now the combination of our networks and Eurosport can really drive that even further.

Okay, that's all we have for today, operator. Thank you very much for joining us, everybody. If you have any follow-ups, please give us a call. Thank you.

Thank you.

Thank you. Thank you for joining today's conference. This concludes the presentation, and you may now disconnect. Good day.