Our only dramas are on-screen, says satellite boss broadcasting his ambition
Mar 15, 2013 (London Evening Standard - McClatchy-Tribune Information Services via COMTEX) --
IF you can measure the importance of a chief executive by the size of his office, what does that mean for a boss who has two of them on the same site Even more intriguing if that captain of industry happens to be the blokeish Jeremy Darroch of BSkyB, among the last you'd imagine to suffer delusions of grandeur despite having been a fixture on the media scene for almost a decade. Only after a tour of Sky's headquarters can you understand why.
From humble beginnings, a media village is taking shape just off the A4 at Osterley in west London. The three low-slung buildings that housed Rupert Murdoch's Sky in its earliest years are now dwarfed by a giant grey edifice with a wind turbine on the roof and a Formula 1 car parked in reception.
And that's not all. From the window of his (second) office whose blond-wood floors still smell new, Darroch can gaze down on diggers clearing the site that will eventually contain new executive offices and meeting rooms.
Across the campus -- which houses 7000 staff today but could climb to 12,000 in time -- a storage depot acquired from Harrods will be knocked down, probably to make way for another production hub.
"We have eight studios here today," Darroch says, glancing out of the window. "We're just debating whether we put another in, which I expect we will do."
Sky, which was built on the lure of films and football, is spreading out into arts programming, comedy and now drama, fulfilling a pledge to hike its spend on home-grown programming by 50 percent to pounds sterling 600 million by 2014.
These days when Darroch is in London that means three days a week spent among the suits, and the remainder symbolically close to the creative types.
But the 50-year-old, captured on camera last summer punching the air to celebrate Team Sky member Sir Bradley Wiggins's Tour de France triumph, is pulled in more directions than that. From beginnings in satellite, Sky now has a broadband base of 4.7 million customers, second only to BT, and is selling movies on-demand in competition with Netflix as well as dowloading its shows to tablet computers and smartphones.
"One of the great things when you are chief executive of Sky is it is not a business you ever have to push," Darroch says. "Its natural momentum is always to say, well what is the next thing we can do and how do we do it I suspect if you ever try to stop Sky there isn't that natural resting point."
It can do all these things because Sky has become a money machine, with closing in on 11 million customers who pay the company on average pounds sterling 568 per year for its services including telephony and high-definition channels, up pounds sterling 24 from a year ago.
Even though it has been shovelling out cash to investors, by buying back pounds sterling 1.25 billion of its own shares in the last two years and hiking the dividend by 20 percent, Sky's borrowings are skimpy for a company with a market value of pounds sterling 14 billion.
"It is a nice problem to have," Darroch says with a chuckle. "We have got lots of ideas, don't worry."
It's some empire, but if things had gone differently, he could have been running much more. Darroch was widely expected to take a key role at News Corporation when Rupert Murdoch's group bought out the 61 percent of the company it didn't already own, combining Sky in Britain with pay-TV businesses in Germany and Italy. The outcry over the phone-hacking scandal saw bid hopes disintegrate. "The business didn't really miss a beat through that period," he says proudly.
That might not be the last of it. Only last month, James Murdoch, Darroch's predecessor who retreated to News Corp in New York after being drawn into the phone-hacking net, described minority investments such as Sky as "unfinished business". So does Darroch expect News Corp to brave the political maelstrom and try again He has been batting questions like this off since his took the top job five years ago.
"If they do then we will deal with that at the time," he says. "My job is to make sure the business is in as good a shape as it can be and if I do that, I'm doing the best job for all of our shareholders."
At least outwardly, Darroch as finance director was the quiet man at the shoulder of James Murdoch, who is a decade his junior and raced around to prove himself. Since promotion, he has carried on the Sky project with aplomb, seeing off an Ofcom probe into whether it was "fit and proper" to hold a broadcasting licence.
If he was a TV show, Darroch comes across as more Inspector Lewis than The Apprentice but that's only because the Geordie's steely glint is well covered.
He learnt his trade over 12 years at grocery giant Procter & Gamble, moving through brands such as Clearasil and Vicks VapoRub, to become finance director for European healthcare in Germany. When it became clear P&G would take him around the world, he quit so that his wife Rachel -- to whom he proposed on the banks of the River Tyne -- could continue her career as a GP in England.
His big break came in 2000 when he was recruited to Dixons, the electrical retailer, by Ian Livingston, later stepping into the top finance role when the Scotsman moved on to BT.
Darroch is also in hot demand as a non-executive director, having announced he is stepping down from the board of Marks & Spencer, where boss Marc Bolland is under pressure to turn around the struggling clothing business. "There are a lot of good things happening there," he says. "Everybody has got a view and an opinion and you have got to try to get yourself away from that noise and stay true to what you are trying to achieve."
Darroch prides himself on thinking broadly. Now TV -- an internet service popular with students which Sky launched to pick up customers who didn't want to commit themselves to a contract -- is a classic P&G strategy of segmenting the market just as if he were still selling soap powder or toothpaste.
"When I first joined Sky, having not worked in the media industry, I was always slightly surprised at how obsessed with itself it was.
"It tends to define everything as a little bit of a zero-sum game and I think that is a mistake."
It shows that Sky is prepared to work harder against competitors such as Amazon-owned Lovefilm and Virgin Media, recently acquired by US cable mogul John Malone's Liberty Media.
"Services like catch-up and on-demand, we don't just dream these up overnight," he says, grabbing a remote control to demonstrate.
It's no coincidence that Darroch is keen to play up its investment in people and technology here just as foreign interlopers stray onto his patch.
And as well as programme makers, he'll be keeping the builders of west London busy for several more years to come.
LIFE AND TIMES
1982 Deloitte Haskins & Sells
1988 Procter & Gamble, rising to European finance director for healthcare
2000 Dixons retail finance director, rising to finance director
2004 BSkyB finance director
2007 BSkyB chief executive
Married with one son and two daughters. Relaxes by keeping fit, walking his dogs, reading and watching Sky.
"My first boss at P&G, UK finance director Glen Wilson, said: 'Always stay open to new possibilities.' That has stuck in my mind so whenever something new comes along, I try to embrace it.
"Another P&G boss, Klaus Sennefelder, had one request of me: spend at least one hour each week just thinking. Get yourself out of the maelstrom of activity and think about what you are trying to do and what the business is trying to do. You will be surprised at what flows from that."
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