Interview: Peter Bazalgette On Why Cash Is King In The Web Economy

Peter Bazalgette

He became famous as the man who brought Big Brother and Deal or No Deal to British TV screens but now Peter Bazalgette is quickly becoming better known as a leading private investor in UK digital businesses. His latest investment is the “social search engine” AskPeopleYouKnow. He also owns a stake in VOD distribution start-up MyVideoRights — as well as sitting on the boards of YouGov, Sony Pictures and B2B investment group CIG Group.

In an interview with paidContent:UK, Bazalgette tells us what he makes of start-ups’ efforts to reach profitability, why Digital Britain will help the online economy and why the death of Big Brother UK doesn’t mean the end of TV’s mass media power:

Building the wild west economy: Bazalgette is enthused by digital innovation but admits that the monetisation of sites isn’t always straightforward. “These start-ups are all very exciting, it’s a bit of a Wild West, there are lots of very clever creative people with vision for digital business. And we’re all working on what the business models are for monetisation. It will all become plain in the next 10 years — in 20 years we’ll all think it’s perfectly obvious.”

Forget reach, cash is king: But don’t think he doesn’t expect a return on his investments. Asked when his investment in APYK might mature, he says: “I’m not going to take you through the business model, but all these businesses have to become cash positive at some point. We’re not naive like we were in the late 90s when we valued businesses on the number of impacts or subscribers. That won’t do anymore, cash is king.”

AskPeopleYouKnow: “They’ve got great experience in consumer products, it’s a great team,” says Bazalgette of his new investment. “Their insight was that Google (NSDQ: GOOG) is a ubiquitous search device but it’s a blunt instrument, it’s a popularity contest. They felt that as time goes on people are going to look for search engines that are more tailored to their particular interests”. Read our interview with APYK co-founder David Gilbey here.

Digital Britain’s business opportunities: “The most important thing in Digital Britain for digital businesses was high-speed broadband, because that really will help the digital economy grow,” he says. One of Bazalgette’s burning pet issues is the use of product placement on TV, which the government signaled it would allow last week. “It’s not a massive breakthrough but it’s significant: they are several people I know who want to set up businesses around trading product placements online.”

Big Brother’s demise: As Endemol’s creative director, Bazalgette brought Big Brother to the UK in 2000. Next summer’s series will be its last in the UK but he rejects that idea that linear, big event TV has had its day: “It’s difficult to say that when Britain’s Got Talent got 19 million (viewers) for its final on *ITV*. It’s certainly true that mass audiences on the main TV channels are not as big as they used to be — but I would turn it around and say that in five or 10 years’ time when mass audiences are very rare, even if they are four or five million compared to the old 10 or 15 million it could be pretty valuable.”

Meerkat TV market: And it’s not just content that can still flourish on linear TV in a digital age according to Bazalgette, ads can too: “Why would Comparethemarket.com be running an ad with meerkats in it on virtually every hour of the day in traditional media to drive an online business? It’s because mass advertising still has a value, that’s why.”

Comments have been disabled for this post