Latest news with #Zaslav
Yahoo
2 hours ago
- Business
- Yahoo
David Zaslav Finally Cuts the Cord
David Zaslav, movie mogul at last. Zaslav's vision board, which includes him sitting behind Jack Warner's old desk and living in Robert Evans' former home, is complete. On Monday, we finally got the news we were waiting for: Warner Bros. Discovery, formed just three years earlier via the merger of Zaslav's Discovery, Inc. and AT&T's WarnerMedia, is being split back up. Zaslav keeps the goods: HBO, HBO Max and the Warner Bros. studios (including TV and DC). His righthand man, WBD CFO Gunnar Wiedenfels, gets the leftovers — the cable channels, basically. Oh yeah, and Gunnar also gets the 'majority' of WBD's $37 billion debt load. That makes Wiedenfels the Mark Lazarus in this Versant copycat situation — if Versant was buried in debt. More from The Hollywood Reporter "Majority" of Warner Bros. Discovery's $37 Billion in Debt Will Be Spun Off With TV Networks, Its CEO Says Ted Sarandos' 'Studio' Appearance Is a Wink - And a Flex 'Care Bears' Movie in the Works From Josh Greenbaum at Warner Bros. Hollywood couldn't have scripted it better — for Zaslav. (Ironic considering his unfavorable positioning during the writers guild strike.) Zaslav, a former attorney, started his True Hollywood Story in the late 1980s as president of NBC's cable, domestic TV and new media distribution divisions. At the time, even he couldn't see how the latter department would basically cannibalize the former three decades later. At what point that became clear to Zaslav, we'll never truly know — not through his (ongoing) public comments, at least. At NBC, Zaslav launched MSNBC and oversaw the Olympics on cable — two properties that would inform future interests. In 2006, Zaslav jumped to Discovery and to his first CEO title; two years later, he took the company public. He always liked the stage. The existing Discovery portfolio wasn't enough for his big ambitions, so Zaslav launched some new networks — like OWN and ID — and bought others (like HGTV and Food Network via an acquisition of Scripps). He got the Olympics back — internationally — in 2015. For 15 years, Zaslav was Mr. Cable (being coached all the way by his mentor: 'Cable Cowboy' John Malone). Zaslav defended the delivery system and the bundle for as long as he could — and then for a few years longer than that. How synonymous with cable was Zaslav? In 2017, he was inducted into the Cable Hall of Fame. Zaslav is a member of the Cable TV Pioneers Class of 2018. Satirically, that was the same year that Zaslav waved the white flag via the launch of Discovery+. Even Zaslav had to say it: streaming was in and cable was out. But there was no way that Discovery+ could compete in the streaming wars, which at the time were all about subscriber growth. A man with mogul ambitions — and a mogul paycheck — wanted more. Also in 2018, AT&T finally closed its wildly dragged out and misguided (and expensive: it was north of $100 billion) acquisition of Time Warner. It took two years for that deal to go through; it only took three years for AT&T to reverse course and sell off the repackaged WarnerMedia, taking a major 'L' in the process. Something about all of this sounds so familiar… In 2022, the $43 billion deal that formed Warner Bros. Discovery — with Zaslav at the helm — was finalized. The creation of WBD came with a mountain of debt, but there were perks. Zaslav, an Old Hollywood head, got his legacy movie studio (WB is 102 years old this year) and a bonafide film lot. He got CNN (and his daughter got a job as a congressional producer there), an upgrade from his old left-leaning cable news channel MSNBC. He also inherited the prestige of prestige-TV through HBO, and for a while there it looked like HBO Max/Max/HBO Max-again just might compete with Disney+ and Netflix. Hell, the New York Knicks fan even got the NBA through Turner. Life was good. The pay wasn't so bad either. Zaslav's 2024 compensation package was valued at nearly $52 million; his 2023 pay was about $50 million. Even in his Discovery-only days Zaslav was among the highest-paid CEOs in media. Patagonia vests aren't cheap. You know who wasn't making money? WBD shareholders. The newly formed company's stock opened April 9, 2022 at $42 per share. Today, shares are teetering around $10. What went wrong? Well, the whole plan, basically. Though direct-to-consumer would become profitable for WBD, it was too little, too late. The film business had its ups and downs. There were the strikes. Cable, the very thing Zaslav is escaping via today's split-and-spin announcement, has only had downs — for Warner Bros. Discovery that included the loss of the NBA and the subsequent implosion of its sports-centric joint venture (with Disney and Fox) Venu, which was dead before arrival. CNN languished under a short-lived Chris Licht regime; CNN+ made it about a month. Even Zaslav's PR was a nightmare: he became the name and the face of Hollywood corporate greed by killing off completed and near-completed projects in the name of tax write offs. A certain panic sets in when you have $50 billion in debt to pay down in a struggling marketplace. So Zaslav jumped ship. He will soon be rid of the 'Also Ran' that is cable TV — and he'll be rid of most of WBD's existing debt as well. If all goes according to plan, Zaslav will have effectively traded in a dying basic-cable bundle for the most influential brand in television and a top-2 or 3 film studio. And he got paid hundreds of millions of dollars to do it. The Zaslav Prophecy will be completed in mid-2026. Best of The Hollywood Reporter How the Warner Brothers Got Their Film Business Started Meet the World Builders: Hollywood's Top Physical Production Executives of 2023 Men in Blazers, Hollywood's Favorite Soccer Podcast, Aims for a Global Empire Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
12 hours ago
- Business
- Yahoo
HBO and CNN owner Warner Bros Discovery to split in two
The owner of CNN and HBO Max, Warner Bros Discovery, says it will split into two companies by the middle of next year. The US media giant plans to separate its studio and streaming business away from its more traditional cable television networks. The move comes as streaming services attract hundreds of millions of users around the world but cable TV has seen audiences decline in recent years. HBO Max has enjoyed success with shows including Succession, The White Lotus and The Last of Us - while channels like CNN have been losing viewers. These hit shows will soon come under a new Streaming & Studios business, along with the company's film division and be headed by Mr Zaslav. The other new company will be called Global Networks - with CNN, Discovery and TNT Sports amongst its brands. This business will be led by Warner Bros Discovery's chief financial officer, Gunnar Wiedenfels. "We are empowering these iconic brands with the sharper focus and strategic flexibility they need to compete most effectively in today's evolving media landscape", said David Zaslav, Warner Bros Discovery president and chief executive. The splitting of the media conglomerate follows the 2022 merger that created Warner Bros Discovery. News of the split did little to improve Warner Bros Discovery's stock market performance. Shares were down nearly 3% in trading on Monday, with the stock down more than 10% this year. Peter Jankovskis, an analyst at Arbor Financial Services, said the split would help investors get a better understanding of each new company's value. "When you make the business less complicated, analysts can go in and do a better job of determining what the business is actually worth," he told the BBC. Warner Bros Discovery's flagship news channel, CNN, has seen its ratings decline. It averaged 558,000 viewers during primetime hours in the first three months of this year, 6% lower than the same period in 2024. In January, the network announced that it was laying off more than 200 employees as it looks to focus on its digital offerings. The outlook is brighter for Warner Bros Discovery's streaming platforms, which ended the first quarter of this year with more than 122 million subscribers. Monday's breakup announcement came after rival media giant Comcast announced last year that it would spin off its NBCUniversal cable television arm. That breakup is currently underway, with channels such as MSNBC and CNBC being separated from Comcast's other brands, including its Peacock streaming service. "It's a very competitive market right now, so many firms are trying to segregate out the streaming portion or the content portion of their businesses so that the remaining business can be valued separately", said Mr Jankovskis. Sign in to access your portfolio
Qatar Tribune
17 hours ago
- Business
- Qatar Tribune
Warner Bros. Discovery to split into 2 companies by next year
Agencies Warner Bros. Discovery will calve off cable operations from its streaming service, creating two independent companies as the number of people 'cutting the cord' brings with it a sustained upheaval in the entertainment industry. HBO, and HBO Max, as well as Warner Bros. Television, Warner Bros. Motion Picture Group, DC Studios, will become part of the streaming and studios company, Warner Bros. said Monday. The cable company will include CNN, TNT Sports in the U.S., and Discovery, top free-to-air channels across Europe, and digital products such as the Discovery+ streaming service and Bleacher Report. Shares jumped 11% at the opening bell. Warner Bros. Discovery CEO David Zaslav will serve as CEO of the company that for right now is called Streaming & Studios. Gunnar Wiedenfels, chief financial officer of Warner Bros. Discovery, will be CEO of the cable-focused entity, for now known as Global Networks. 'By operating as two distinct and optimized companies in the future, we are empowering these iconic brands with the sharper focus and strategic flexibility they need to compete most effectively in today's evolving media landscape,' Zaslav said in a statement. Just days ago Warner Bros. Discovery shareholders in a vote that was symbolic as it's nonbinding, rejected the 2024 pay packages of some executives, including Zaslav, who will make more than $51 million. Warner Bros. Discovery said in December that it was implementing a restructuring plan in which Warner Bros. Discovery would become the parent company for two operating divisions, Global Linear Networks and Streaming & Studios. That was seen as a preview of the separation announced Monday. Warner Bros. Discovery was created just three years ago when AT&T spun off WarnerMedia and it was merged with Discovery Communications in a $43 billion deal. The cable industry has been under assault for years from streaming services like Disney, Netflix, Amazon and Warner Bros. own HBO Max. The industry is also being pressured by internet plans offered by mobile phone companies. Comcast, which is of nearly equal size to Charter, spun off many of its cable television networks in November, seeing so many customers swap out their cable TV subscriptions for streaming month Charter Communications offered to acquire Cox Communications, a $34.5 billion merger that would combine two of the top three cable companies in the U.S. So-called 'cord cutting' has cost the industry millions of customers and left them searching for ways to successfully compete.
Yahoo
18 hours ago
- Business
- Yahoo
Warner Bros. Discovery Stock Enjoys Big Jump, Then Promptly Fades After Split Announcement
Warner Bros. Discovery's plan to split into two publicly traded companies sent its stock price surging higher on Monday morning, with shares of WBD jumping 13% to $11.10 on the Nasdaq exchange only minutes after the opening bell. Those early gains started to fade by midday, though, with Warner Bros. Discovery's stock trading for $9.94 per share at 1 p.m. ET — up 1.30% from where it closed last week. Here is an up-to-the-minute look at WBD: On the year, WBD is down 6%, and the company's stock price has been more than sliced in half since it debuted on the Nasdaq in 2022 for $24.08 per share. That came after WarnerMedia and Discovery merged — a move that was met with a collective shrug from Wall Street analysts and investors from the start, with its stock price increasing 0.8% on April 11, 2022, its first day of trading. Now, three years later, WBD announced on Monday it will split into two companies, with one company focused on its global cable channels and another dedicated to its movie and streaming businesses. David Zaslav, president and CEO of WBD, will become president and CEO of Streaming & Studios, while Gunnar Wiedenfels, WBD's CFO, will serve as president and CEO of Global Networks. The separation is expected to be completed by mid-2026. 'By operating as two distinct and optimized companies in the future, we are empowering these iconic brands with the sharper focus and strategic flexibility they need to compete most effectively in today's evolving media landscape,' Zaslav said in a statement. The new Streaming & Studios operation will consist of Warner Bros. Television, Warner Bros. Motion Picture Group, DC Studios, HBO and HBO Max, in addition to their corresponding film and television libraries. Global Networks, meanwhile, will include international entertainment, sports and TV news brands such as CNN, TNT Sports, Discovery, Discovery+, Bleacher Report and European free-to-air channels. In related news, WBD investors last week voted to reject a $51.9 million compensation package for Zaslav. The post Warner Bros. Discovery Stock Enjoys Big Jump, Then Promptly Fades After Split Announcement appeared first on TheWrap. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
19 hours ago
- Business
- Yahoo
Warner Bros. Discovery will split into two separate companies
Warner Bros. Discovery is dividing its assets into two separate publicly traded companies, the media conglomerate announced Monday. The move will put the company's iconic movie studio, television production, HBO and HBO Max and DC Studios into a single entity known as Streaming & Studios. Cable channels CNN, TNT, Discovery and its European over-the-air networks will operate under the banner of Global Networks. The split is a recognition the merger that created Warner Bros. Discovery three years ago was a flop. Chief Executive David Zaslav's strategy back then was bigger is better. But Wall Street soured on that debt-heavy consolidation that married nearly two dozen basic cable channels, including HGTV and Food Network, with the prestige properties of HBO and the Warner Bros. studios in Burbank. With the breakup, which is expected to be complete by mid 2026, executives hope to attract investors in the company's growing streaming business without exposure to the mature traditional TV business, which is in steep decline. 'The decision to separate Warner Bros. Discovery reflects our belief that each company can now go further and faster apart than they can together,' Zaslav, the chief executive, told investors on a conference call. Read more: Warner Bros. Discovery's streaming service Max becomes HBO Max — again Zaslav will head the Streaming & Studios unit. Gunnar Wiedenfels, chief financial officer of Warner Bros. Discovery, will serve as president and CEO of Global Networks. Both will continue in their present roles at WBD until the separation. Warner Bros. Discovery's beleaguered shares surged briefly on Monday's news. But throughout the day, gains were erased and Warner Bros. Discovery's stock traded down 3% to about $9.50 a share. The combined company is currently worth less than $23.5 billion — a more than 60% loss in value since April 2022, when Warner Bros. Discovery was created. Zaslav orchestrated that $43-billion merger by combining his smaller Discovery with Warner and HBO portfolio, then owned by AT&T. The Dallas phone company had taken a blood-bath in its four-year foray into entertainment and was eager to exit. Since then, Warner Bros. Discovery has cut thousands of employees, projects and other expenses to pay down the enormous debt to finance the 2022 merger. The company's cable channels were hit with another round of layoffs just last week. Downsizing in every corner left Warner Bros. Discovery without resources to effectively compete against Netflix and Amazon Prime Video, which have built streaming services that boast something for everyone, which had been Warner Bros. Discovery's original ambition. Read more: David Zaslav: Hollywood reformer or wrecking ball? Instead, the company's focus became paying down its debt. It has successfully retired about $20 billion, but the company still is grappling with $33 billion in debt from the merger. S&P Global Ratings last week downgraded the company's debt to "junk" status, citing its continued challenges with linear cable channels. Last summer, the company took a $9-billion write-down to reflect the lower value and subdued outlook for the basic cable channels. Over the last three years, Zaslav-led initiatives, including folding the smaller Discovery+ streaming service into HBO Max, failed to create the desired bounce. Discovery has long been known for its low-cost, nonscripted programming such as "Naked and Afraid" on Discovery, "90 Day Fiance" on TLC and "Beat Bobby Flay" on the Food Network. Read more: Benched by the NBA, Warner Bros. Discovery boss David Zaslav faces tough questions In another effort to give the streaming service mass-audience appeal, Zaslav and his team stripped "HBO" from the title of the streaming service two years ago, calling it simply "Max." Last month, the company announced another reversal by restoring the HBO name to the streaming service, which has seen growth with HBO shows such as "The White Lotus" and the Max original, "The Pitt." "We feel like we've found a very compelling strategy of quality," Zaslav told analysts. The Discovery+ streaming service will be shuffled into the Global Networks company. Read more: David Zaslav's pay rises to $52 million, despite rocky year for Warner Bros. Discovery "The diverging fortunes of streaming and traditional pay TV have been unmistakable for years, so it was only a matter of time before the dominoes started falling," Paul Verna, Emarketer's vice president of content, said in a statement. "Like the recent pivot by WBD to revert back to the previous name of its flagship streaming service, HBO Max, this move reveals a company fumbling its way through disruption," Verna said. Investors also have expressed dismay with Zaslav's and other executives' fat compensation packages. Last year, amid the company's swooning stock price and asset write-downs, Zaslav was awarded $51 million in compensation. In a nonbinding vote, nearly 60% of Warner Bros. Discovery shareholders last week voted against the 2024 compensation packages during the annual meeting, according to a regulatory filing. Read more: Warner Bros. Discovery shareholders reject advisory vote on executive pay Next year's split is envisioned to be a tax-free event for stockholders, who will receive shares in both companies. Warner Bros. separately said it had lined up a $17.5-billion bridge loan from JPMorgan Chase & Co., which is expected to be recapitalized before the spinoff. That loan will help the company as it seeks to parcel its current debt load between the two companies. The cable network business — which still generates the majority of the company's earnings — will bear the brunt of the debt load, the executives said. Under the deal, Global Networks will keep a 20% stake in the studios company. That will give the networks company revenue opportunities to help pay down debt. Both entities could become attractive targets for takeover by larger media companies. Apple, NBCUniversal or Paramount Global (should it finalize its sale to David Ellison's Skydance Media) may be interested in combining its streaming service with HBO Max and absorbing Warner Bros. once-industry-leading studio operations. Read more: Hollywood's cable struggles become clearer as write-downs add 'nails to linear TV's coffin' Zaslav has hinted at the split since Comcast announced last summer that it was putting MSNBC, CNBC, the Golf Channel, USA Network and other outlets into a new company called Versant, separating the mature businesses from the rest of the company as it focuses on streaming. Comcast has said Versant would have the financial muscle to buy other cable channels, and Global Networks could make a good fit, although there may be regulatory concerns that come from combining such a huge share of the market as well as Versant's MSNBC with Warner Bros. In December, Warner Bros. Discovery began preparing for Monday's announcement by reorganizing internally to create two business units for its earnings and balance sheet. Sign up for our Wide Shot newsletter to get the latest entertainment business news, analysis and insights. This story originally appeared in Los Angeles Times.
