Warner Bros. Discovery to Split TV and Movie Business
By Movieguide® Contributor
The death of linear TV may truly be impending as another legacy studio, Warner Bros. Discovery (WBD), announced its intention to split off its TV business from the rest of the company.
WBD CEO David Zaslav announced earlier this month that his company will soon restructure itself into two distinct businesses, one that encapsulates linear TV, with the other holding the rest of the company’s assets.
“Since the combination that created Warner Bros. Discovery, we have transformed our business and improved our financial position while providing world class entertainment to global audiences,” Zaslav said.
“We continue to prioritize ensuring our global linear networks business is well positioned to continue to drive free cash flow, while our streaming and studios business focuses on driving growth by telling the world’s most compelling stories,” he continued. “Our corporate structure better aligns our organization and enhances our flexibility with potential strategic opportunities across an evolving media landscape, help us build on our momentum and create opportunities as we evaluate all avenues to deliver significant shareholder value.”
The restructuring would also allow the linear TV business to declare bankruptcy without dooming the rest of the company.
This split provides a path forward like Comcast’s, which announced a similar plan in November. Comcast’s restructuring placed its declining linear TV assets in one silo and its sports, movie and theme park operations in another, shielding the company as a whole from the death of cable TV.
READ MORE: WHY DID COMCAST SPIN OFF ITS CABLE CHANNELS?
Disney, another major holder of linear TV networks, has expressed a similar disinterest in its legacy media, considering selling off its most popular networks, like ABC, before they lose too much value.
The waning support for these networks from their parent companies may signal a death call for cable TV as they are largely unable to financially support themselves in the new media world. Furthermore, many streaming services have either cracked profitability or are well on their way to doing so, creating more lucrative income streams for these companies. With interest in cable TV at an all-time low, the restructuring of these companies seems to be nothing more than preparations for the end.
READ MORE: HAS STREAMING KILLED CABLE?
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