5 Burning Questions About M&A, MSNBC and Extra

Comcast believes it has discovered an answer to the issue of what to do with a passel of huge cable property which are getting into a interval of ongoing decline. In doing so, nevertheless, the cable-and-entertainment big additionally raises a big variety of questions.

The proprietor of NBCUniversal stated Wednesday that it deliberate to separate the media big in two. One half will comprise its NBC and Telemundo broadcast networks; NBC Sports activities; Bravo; Peacock; TV stations; the Common movie operations; and theme parks. The opposite will comprise a bunch of enormous cable networks together with USA, MSNBC, CNBC, E!, Oxygen and Golf Channel, in addition to digital properties reminiscent of Fandango and Rotten Tomatoes.

The concept, in line with folks conversant in the matter, is to free the printed and streaming property, seen as extra fascinating properties in an period when extra persons are transferring to on-demand viewing of their video favorites on websites reminiscent of Peacock, Netflix and Disney+, from the cable properties. The cable networks stay worthwhile, however that enterprise is in decline. Spun off from their dwelling, executives imagine, the brand new firm may develop by snatching up different TV networks that others may need to ditch for comparable causes.

If solely it had been all really easy.

Beneath, an inventory of questions that executives at Comcast, NBCU and the brand new “SpinCo” must navigate — the method is prone to take a yr! — as they undertake a enterprise that’s probably to attract the fixed scrutiny of the remainder of the media trade.

*What different cable networks will the brand new firm covet? The spin-off seems to be little like others of its form. The brand new Comcast firm received’t be loaded down with debt like rival Warner Bros. Discovery. Its managers are veterans, together with new CEO Mark Lazarus, who has held senior working TV roles for years. And Comcast expects the brand new entity to be an acquirer of property, in line with an individual conversant in the matter.

To make sure, cable just isn’t the media venue of the longer term. However have you ever seen these costs? Paramount International and Warner Bros. Discovery, two of the larger homeowners of high cable networks, have stated their property are dropping worth. Warner in August unveiled a large $9.1 billion write-down of its TV property, citing enterprise headwinds in addition to the projected lack of its profitable settlement with the NBA to indicate video games on its cable networks. Paramount International adopted swimsuit, revealing a $5.98 billion impairment cost because it ready for its acquisition by Skydance Media.

The brand new Comcast spin-off may be capable of choose up storied model names at decrease prices, including to the leverage its networks may have within the market.

*How do you run two information networks lower off from the newsgathering of NBC Information? Journalists inside the big NBC Information Group have began “freaking out” prior to now 24 hours, in line with two folks conversant in the operations, as a result of the proposed spin-off raises many unanswered questions on their futures.

Can MSNBC and CNBC, separated from the newsgathering equipment of NBC Information, operate as they’ve? To make sure, CNBC has largely been handled as a separate entity over time, the results of quarrels between previous executives, and has put new deal with cultivating ties with business-information aficionados. MSNBC, nevertheless, depends closely on the data and particulars ferreted out every day by NBC Information. Certainly, a lot of the MSNBC daytime schedule is stuffed with journalists, not opinion hosts, who stay affiliated with NBC Information and Telemundo, together with Chris Jansing, Katy Tur and Jose Diaz-Balart. NBC Information contributors and reporters often visitor on MSNBC segments.

Executives are prone to deal with this concern over the following yr, in line with an individual conversant in the matter. It’s attainable to have sure industrial or licensing agreements put in place that may assure utilization of NBC Information reporting, contributors and expertise on the 2 cable networks. On the similar time, the spin off may pressure MSNBC to focus much more closely on the progressive opinion programing that’s its bread and butter. And it may free CNBC to go after its core viewers with out having to fret about NBC Information, which has its personal reporters who cowl enterprise and the financial system.

All these questions surfaced Wednesday throughout a gathering between MSNBC staffers and Lazarus, who was unable to state definitively whether or not or not the community might need to contemplate a reputation change or take away varied NBC markings from its emblem.

Some tea leaves could also be within the offing. It is going to be attention-grabbing to see who replaces Andrea Mitchell when she leaves her long-running MSNBC midday program in early 2025. Will her successor come from the ranks of NBC Information’ many Washington-based journalists? Or will or not it’s a brand new opinion host who may lead a brand new cost into daytime (one thing MSNBC tried a number of years in the past with Ronan Farrow and Pleasure Reid).

*Will Madison Avenue need to do as a lot enterprise with two smaller media entities? A part of the enchantment of NBCUniversal to advertisers is it represents a one-stop-shop of types. There’s broadcast, cable, motion pictures, digital, theme parks — and, lately, the prospect to check out advertisements that permit a streaming person click on to buy a product, or the chance to promote in Apple Information.

The brand new spin-off, nevertheless, is prone to create two smaller firms with alternatives much less huge than these of rivals. For the cable entity, the prospect of promoting USA, MSNBC and different cable networks might be extra fraught. Advertisers have been pulling {dollars} out of common cable and placing them into streaming in current “upfront” cycles, and so they have been notably cautious of reports networks, particularly those who highlight opinion programming.

Previously, NBCU may use its big-tent sports activities broadcasts, primetime schedule and late-night array to spur sponsors to purchase some cable for extra ballast. Now, cable might be on their lonesome.

It stays unclear as as to if the NBCU ad-sales staff will stick collectively to promote every thing underneath one basket, or if the group might be cut up together with the media properties. The idea raises main sticking factors, reminiscent of whether or not two completely different groups of Comcast-backed advert reps might be calling on main companies to promote completely different sports activities and leisure programming, with much less authority to cobble collectively the larger packages many advertisers crave in a world the place they should present up extra ceaselessly to get their messages out to potential clients.

*Why isn’t Bravo going alongside for the experience? Bravo, the house to Andy Cohen’s late-night program and the “Actual Housewives” franchise, just isn’t resistant to present cable developments. And but, it’s going to stick with NBC.

The explanation has little to do with linear economics and extra to do with streaming. Merely put, subscribers to Peacock are heavy customers of Bravo programming in addition to the fare from broadcast, in line with an individual conversant in the matter. If the “new” NBC is all about fueling the expansion of streaming (and the broadband gross sales of Comcast’s massive cable-services division), then Bravo’s dwelling will not be with its cable colleagues,

And but, Bravo just isn’t faring any higher than its soon-to-be-separated cousins. Subscribers to Bravo are anticipated to dip practically 5% over the following yr, in line with information from market-research agency Kagan, a part of S&P International Intelligence. Subscribers are seen falling to 62.6 million in 2025, Kagan says, in contrast with 65.8 million in 2024. Advert gross sales are additionally seen tumbling. Bravo’s advert income in 2025 is anticipated to complete $274 million, a 6.5% decline from the $293.3 million the community is projected to seize this yr.

*Is NBCU’s ‘Symphony’ now a damaged report? One of many greatest promoting factors for the existence of NBCUniversal since Comcast started shopping for it from Normal Electrical in 2009 has been the corporate’s skill to cross-sell and cross-promote each its personal TV packages and flicks in addition to its advertisers’ items and companies. How you can do it? Former NBCU CEO Steve Burke referred to as the method “Symphony” — a stupendous sound made solely from the distillation of many various gamers.

That’s why some massive broadcast debuts are touted in promos that air on E! or Oxygen, or why you’re seeing nods to Common’s soon-to-launch “Depraved” present up alongside “At the moment” and “Saturday Night time Dwell.”

Coordinating such stuff is perhaps harder if cable and a few digital are siloed off from the remainder of the corporate. Will NBC and its spin-off must assign executives to coordinate with one another throughout a company divide? The premise conjures up scenes from the 1999 satire “Workplace Area” (not a Common movie, by the best way) by which one center supervisor is requested again and again to explain his job operate of serving as a go-between with shoppers and engineers. “I take care of the g—amn clients so the engineers don’t must! I’ve folks expertise! I’m good at coping with folks! Can’t you perceive that?”