Warner Bros. Discovery separates its linear television business from its streaming and movie studio business.
This follows a similar move by Comcast, which announced in November that it would spin off all of its NBCUniversal cable networks, Bravo, into an independent company.
The new corporate design will end in the middle of next year, WBD said. Unlike Comcast, WBD will execute its assets in a separate company.
A new global department of linear networks will spatialize television houses such as Discovery Channel and CNN, while the transmission side
“Our Global Linear Networks business is well located to continue generating a flexible money flow, while our streaming business
A source with direct knowledge of the record stated that this resolution was aimed at cleaning up the design of the company, which was formed in 2022 from the mixture of warnermedia and discovery. (Discovery the product of its acquisition of Networks Scripps in 2017).
This user said the company is still figuring out how the express business sets will be divided and that no leadership adjustments are planned.
The moves by Comcast and WBD remove the darkness of a decaying cable company. Repositioning their homes could help them participate in potential mergers and acquisitions that will reshape the media and entertainment industry by 2025.
Warner Bros. Discovery aimed to create scale, price, and assistance to compete with big tech by combining WarnerMedia’s prestigious networks, such as HBO and CNN, with Discovery’s lifestyle homes, such as HGTV. But its inventory has fallen to about a third of its price when it was created in 2022 (it was up about 14% on Thursday morning when the new organization was announced).
Industry observers say a turnaround by Comcast would not be favorable to WBD because it wants cash from its linear channels to pay off the large debt the company has taken on.
Still, they see WBD’s make-or-break channels, with Paramount Global or Comcast noted as the most likely merger partners.
The announcement was met with mixed reactions from analysts. BofA Securities, which has long argued that WBD should sell assets or merge with another company, said in a note that it saw WBD’s linear assets as a logical partner for the Comcast SpinCo, while its streaming and studio assets could be an attractive takeover target for multiple suitors.
Brian Wieser, a longtime advertising industry consultant, said that, as for Comcast Spinco, the separation from WBD, however, weakens the corporate on several fronts. Without being connected to stressed channels, he said, it will be more complicated for the WBD Streamer Max to expand its advertising activity, which is increasingly important. Linear networks will lose their influence in distribution negotiations without Max and will be difficult to draw talent if they are perceived as a declining company, among other problems, he said.
In July, WBD would have proposed to investors to cancel the fusion of 2022 to create two separate divisions. And in August, the company said that its television assets were worth nine billion less than what it had planned just two years ago.
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