Comcast to spin off MSNBC, CNBC and other cable channels
Comcast Corp. is cleaving off a huge chunk of its television portfolio to create a new company composed of its cable channels, including MSNBC, CNBC and USA Network.
The Philadelphia-based cable giant unveiled its plan to create a new publicly traded company as well as a new corporate structure for NBCUniversal on Wednesday. The new company — currently dubbed SpinCo, although that will change — will offer news, entertainment and sports channels reaching about 70 million U.S. homes and have the financial heft to acquire other channels, Comcast said in its announcement of the move.
“With significant financial resources from day one, SpinCo will be ideally positioned for success and highly attractive to investors, content creators, distributors and potential partners,” Comcast Chair Brian Roberts said in the statement.
The $7-billion spinoff comes as traditional media companies grapple with the diminishing value of what was once an economic pillar of the entertainment business. For years, NBCUniversal’s cable channels — including USA, Bravo, Syfy, Golf Channel and E! — provided the company’s most reliable profits.
But as consumers shift to on-demand streaming platforms, the future of cable channels looks increasingly bleak. Comcast is taking an exit ramp on cable programming by creating a new company, comprising nearly all of NBCUniversal’s current cable networks with the exception of Bravo, the home of “Real Housewives.”
Legacy NBCUniversal also will hold on to its marquee Universal Pictures film studio and Universal theme parks as well as the NBC broadcast network and TV studio, local television stations, NBC Sports, NBC News, Spanish-language network Telemundo and streaming service Peacock.
Keeping Bravo is an interesting twist, but its content has been a potent driver for Peacock, and the linear channel still achieves healthy ratings.
Comcast’s current shareholders will be given stock in the new company.
Mark Lazarus, who has presided over NBC Sports and NBCUniversal’s networks business for about a decade, will lead the new company as chief executive.
Lazarus, a former Turner Broadcasting executive, joined Comcast in 2010 and assumed control of NBC Sports the following year after Comcast bought control of the broadcast company from General Electric and installed its own management team.
“As a stand-alone company with these outstanding assets, we will be better positioned to serve our audiences and drive shareholder returns in this incredibly dynamic media environment across news, sports and entertainment,” Lazarus said in a statement. “We see a real opportunity to invest and build additional scale and I’m excited about the growth opportunities this transition will unlock.”
Another top executive, NBCUniversal Chief Financial Officer Anand Kini, will segue into the same role at the new entity and also serve as the chief operating officer.
The new firm will have the same dual-class share structure as Comcast, giving Roberts and his family one-third control of the new company’s voting stock.
Roberts will not serve on the board of the new firm or on the management team.
Top NBCUniversal executives Mark Lazarus, Cesar Conde and Mark Woodbury received bigger portfolios. Susan Rovner, who oversaw television programming, is leaving the company.
Comcast will fold NBCUniversal’s digital businesses — Rotten Tomatoes, Fandango, GolfNow and SportsEngine — into the new company.
The separation, which probably will close in about a year, has already led to a new management structure for NBCUniversal.
Donna Langley becomes chair of NBCUniversal Entertainment & Studios, assuming greater responsibilities, including for NBC Entertainment. She will continue to oversee the Universal film and television studios as well as the marketing of entertainment programming.
“In this expanded role, she will lead greenlight decisions across the NBCU enterprise and have full oversight of all entertainment programming and marketing across Peacock, Bravo, and NBC—including primetime and late night,” Comcast President Mike Cavanagh said in a memo announcing the changes to employees.
Langley “will continue to oversee the global creative strategy, business operations, production, acquisitions, marketing, and distribution for our portfolio of award-winning Film and Television Studios,” Cavanagh said.
Langley has long been a respected tastemaker in Hollywood, but her profile within the company has grown dramatically since taking over the film studio five years ago.
Universal Pictures now is one of the most stable and prolific studios around. During Langley’s tenure, Universal has produced two of the most profitable years in its 112-year history, with “Oppenheimer,” directed by Christopher Nolan, generating nearly $1 billion in ticket sales and winning the Oscar for best picture.
The studio also scored with “The Super Mario Bros. Movie” and “M3gan.” This year, Universal produced hits such as “Twisters” and the upcoming first installment of “Wicked,” which is expected to be another box-office juggernaut.
Longtime Comcast executive Matt Strauss gets a big promotion, partnering with Langley on the business side. He becomes chairman of the NBCUniversal Media Group, overseeing NBC Sports and other business functions, including distribution and ad sales. Strauss has led international operations and direct-to-consumer offerings for the last four years.
Cesar Conde will continue in his position as NBCUniversal News Group chairman, leading NBC News and NBC News Now, Telemundo Enterprises and the local television stations, including KNBC-TV Channel 4 in Los Angeles.
Communications and human resources executive Adam Miller becomes chief operating officer for NBCUniversal, “reflecting the leadership he provides across all aspects of the company,” Cavanagh said in his note to employees.
Cavanagh hinted at the new structure late last month, during Comcast’s most recent earnings call with analysts. He said such a move could allow the cable channels “to take advantage of opportunities in the changing media landscape and create value for our shareholders.”
NBCUniversal is banking on the considerable cash flow that the cable channels generate to position the new entity as an attractive investment for shareholders. Sources indicated that some of those profits could be used to scoop up other cable outlets to consolidate the new firm’s clout in the marketplace.
However, NBCUniversal distribution executives have long packaged NBC, which boasts “Sunday Night Football,” with the company’s cable channels to maintain its cable programming fees.
Times staff writer Stephen Battaglio contributed to this report.
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