Comcast is undertaking a major restructuring, spinning off its cable television networks into a separate publicly traded company. This was reported by the Wall Street Journal. The move will see networks like MSNBC, CNBC, USA, Oxygen, E!, Syfy, and Golf Channel become a standalone entity.
Interestingly, Bravo will remain under Comcast's umbrella, alongside the NBC broadcast network and the Peacock streaming platform. The spin-off, anticipated to be officially announced Wednesday, is structured as a tax-free transaction for Comcast shareholders and is projected to take approximately one year to finalize.
The impact on shared sports properties between the NBC broadcast network and cable entities like USA, and on news gathering and editorial collaborations between NBC News, MSNBC, and CNBC, remains uncertain. The cable network portfolio generated a substantial $7 billion in revenue in the 12 months leading up to September 30th.
Mark Lazarus, Chairman of NBCUniversal Media Group, will lead the new company as CEO, with NBCU Chief Financial Officer Anand Kini serving as both CFO and chief operating officer. Comcast Chairman and CEO Brian Roberts will retain a one-third voting stake but will not be on the board.
This decision reflects the challenges faced by traditional cable networks as viewers increasingly turn to streaming services. During its October third-quarter earnings call, Comcast acknowledged exploring options for its cable network assets. The company reported a loss of 365,000 pay TV subscribers in the third quarter of 2024, bringing its total subscriber count down to 12.8 million. Video revenue also experienced a 6.2% year-over-year decline, reaching $6.7 billion.
This move follows significant write-downs by other media companies on their cable network valuations. Paramount Global and Warner Bros. Discovery collectively recorded $15 billion in write-downs during their second quarters, while Disney reported a $584 million write-down on its entertainment networks in its fourth quarter.