Comcast to spin off raft of cable TV channels

News

Channels being spun off include MSNBC, CNBC, Oxygen, and E!

According to various news reports today, US telco giant Comcast is set to spin off some of its largest TV channels, including MSNBC, CNBC, and E!

The channels, which generated a collective revenue of around $7 billion over the last year, will form a new entity that is currently being referred to as ‘SpinCo’.

The news comes following an earnings call last month in which Comcast President Mike Cavanagh said the company was considering a major restructure of its media assets.

“Like many of our peers in media, we are experiencing the effects of the transition in our video businesses and have been studying the best path forward for these assets,” Cavanagh said at the time.

“To that end, we are now exploring whether creating a new well-capitalized company owned by our shareholders and comprised of our strong portfolio of cable networks would position them to take advantage of opportunities in the changing media landscape and create value for our shareholders,”

In a memo to staff today, Cavanagh further explained the structure of the spin off.

“Today we announced the exciting news that we intend to launch a new publicly traded company comprised of a strong portfolio of our cable television networks, including USA Network, CNBC, MSNBC, Oxygen, E!, SYFY, and Golf Channel, along with complementary digital assets including Fandango and Rotten Tomatoes, GolfNow and Sports Engine,” he wrote.

“I believe the effort will be well worthwhile, as this project will inject energy and renewed focus in both the new company and the future NBCUniversal. When you combine our assets, talented management team, and balance sheet strength, we are uniquely positioned to set both SpinCo and NBCUniversal up to play offense in a complex and evolving media landscape,” the letter concluded.

The new business will be run by Mark Lazarus, the current chairman of NBCUniversal’s media group, while NBCUniversal’s Chief Financial Officer, Anand Kini, will serve as CFO and operating chief.

While the transition process currently does not have a precise timetable, the decoupling is expected to be completed in approximately one year.

“I believe the effort will be well worthwhile, as this project will inject energy and renewed focus in both the new company and the future NBCUniversal. When you combine our assets, talented management team, and balance sheet strength, we are uniquely positioned to set both SpinCo and NBCUniversal up to play offense in a complex and evolving media landscape,” concluded the letter.

The rise of streaming channels and a shift in viewership preferences have seen pay-TV revenues sliding for years, leaving traditional broadcast players struggling to pivot. Comcast’s own streaming platform, Peacock, has been attempting to carve out a niche in the streaming market with moderate success, recording around 33 million paid subscribers as of Q2 2024.

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