The Legacy of the Warner Bros. Discovery/Wolfbros. Television Corp. (WBTV) merger, as announced by Zaslav
In an internal company memo seen by Wall Street Journal reporter JoeFlint, Zaslav said that while work since the WarnerMedia and Discovery merger in 2020 has been challenging at times, the company has made strong progress in returning its film and television studios to industry leadership.
Warner Bros. Television, Warner Bros. Motion Picture Group, DC Studios, HBO, and HBO Max, alongside their respective film and television libraries, will fall under a new “Streaming and Studios” company. Another company, described as “Global Networks,” will run entertainment, sports, and news television brands, including CNN, Bleacher Report, the Discovery Plus streaming service, TNT Sports in the US, and Discovery TV channels across Europe.
“The cultural significance of this great company and the impactful stories it has brought to life for more than a century have touched countless people all over the world. It’s a treasured legacy we will proudly continue in this next chapter of our celebrated history,” Zaslav said in announcing the split.
“By operating as two distinct and optimized companies in the future, we are empowering these iconic brands with the sharper focus and strategic flexibility they need to compete most effectively in today’s evolving media landscape.”
The killing of CNN’s streaming service, as well as failed bids for renewal of NBA rights for Turner and layoffs at various properties, are all part of Warner Bros. Discovery’s history since it started paying down that debt.
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The company’s shares rebounded after Monday’s announcement, bouncing up by more than 10% in the hours after. According to a study by the Harvard Law School, Zaslav had a compensation package worth over 50 million dollars last year. In a symbolic vote, shareholders voted against it.
The transaction is expected to close in the middle of next year, but only if the US IRS allows it to proceed without taxes. In his first few months in office, President Trump has made it known that he is willing to use non-partisan government levers for his political and ideological goals.
Most recently, Trump suggested he would seek to revoke governmental contracts with Tesla after a public falling out with its controlling owner, Elon Musk, who had previously served as his adviser on slashing federal budgets. CNN is being blasted by Trump as unfair, partisan and “fake news.”
“These are two much smaller companies than the grand vision [Zaslav] anticipated when he bought the assets from AT&T,” former CNN US president Jonathan Klein tells NPR. Who buys each of these small units now that they’re small enough to be bought?
Several former television executives asked whether the new parent for MSNBC and CNBC – named Versant – might be a natural buyer for Warner Bros. Discovery’s cable channels. Or private equity investors intent on maximizing profits might decide to pick up Warner Bros. Discovery’s cable networks, Versant – or both.
The Financial Times reported in July 2024 that Zaslav was considering creating a new company to separate WBD’s streaming business from the growing debts of its suffering legacy TV networks. Splitting the company in two appears to be WBD’s solution to handling those losses. WBD is taking out a short term loan to buy back some of its debt before it splits. The company didn’t specify how much debt would be placed against each of the new companies, but said in an investor call that the “majority” would fall under Global Networks.