Selling off lots of the company’s valuables failed to impress investors, so Warner Bros Discovery could now be split into two.
Ever since Warner Brothers Discovery boss David Zaslav took over, it feels like it’s been a fire sale at the company. If it’s not nailed down, sell it. If it is nailed down, sell it and try and fetch a few coppers for the nails too.
Among the *coughs* ‘highlights’ of the CEO’s tenure, we’ve seen completed films get deleted as tax write-offs, part of the studio’s sound library sold off and programming that was touted as exclusive to its Max streaming platform popping up elsewhere.
Whether the struggling company actually has more money now, we don’t know. (We do know that amid all of this savage cost-cutting, Zaslav himself got a pay rise though.) What’s next to be sold then? Today’s news might offer an inkling – and it could be a biggie, even by Zaslav’s standards.
According to The Financial Times, Warner Bros Discovery is said to be considering a company-wide split, separating its film and streaming division from its TV networks and cable assets. This would allow the streaming platform and the film studio – home to all of that juicy intellectual property – to escape most of the hefty $39bn debt that the company is currently saddled with.
As for the other half, those TV networks are dependent on an advertising-led cable TV model which is in decline (even if some such as CNN and HBO clearly possess real value). Then there’s that hefty debt too. Whether Zaslav is looking to sell or merge these networks or make the film studio and streaming platform a more attractive proposition for purchase, we’ll have to wait and see.
With Paramount’s deal with Skydance looking more and more like a sure thing, eyeballs will be turning towards WBD next as we wait to see how the fate of another historical and prestigious Hollywood studio will play out. The upcoming US elections may also play a key part in how the next administration views huge mergers and acquisitions, so that’s a key part of the narrative too.
Anybody who saw Xbox’s recent Game Pass price hike coming from a mile away (even though the company specifically promised not to do this as part of its recent merger with Activision) knows that a merger between two huge companies isn’t always great for the consumer. At least with Paramount, there was always the feeling that the studio’s owners wanted the best for the future of the business and were willing to cut a worse deal for themselves to ensure this happened.
David Zaslav though? He hasn’t exactly proved to be filmmaker-friendly over the past couple of years and as such, there’ll be plenty of folks watching events unfold with a sense or real trepidation. We’ll bring you more on this one as we hear it.
