Comcast explores spinoff of cable networks
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Comcast president Mike Cavanagh told investors Thursday the company is considering breaking out NBCUniversal's cable networks into a separate, publicly traded company.
- The move could give it more flexibility to focus on scaling its streaming service, Peacock.
Why it matters: Comcast declined the opportunity earlier this year to explore a merger with rival Paramount. Cavanagh implied during an earnings call Thursday that the company would rather consider partnerships in streaming, "despite their complexities."
Zoom in: Spinning out a separate, publicly traded company of cable networks could position Comcast to take better advantage of new streaming partnership opportunities, Cavanagh said.
- A possible spinoff wouldn't include NBC, the broadcast network, he added.
- NBCU's suite of cable networks includes MSNBC, CNBC, Oxygen, Bravo, USA Network and others.
- "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," he said.
Zoom out: Comcast is no stranger to streaming joint ventures and partnerships.
- It was part of a streaming joint venture for Hulu with Disney and AT&T until Disney acquired the remainder of Hulu last year.
- Reports suggest the firm had considered a streaming joint venture with Paramount before Paramount agreed on a merger deal with Skydance Media.
The big picture: Comcast's TV peers have similarly weighed separating or divesting their linear assets from their portfolios. None have actually made the move.
- Cable television — while facing heavy viewership declines due to cord-cutting — is still mostly very profitable. Despite investor angst around the declining medium, those profits are critical for streaming investments.
- Disney CEO Bob Iger last year teased the possible sale of the firm's linear TV assets, including its broadcast network ABC, but later suggested interest in that idea had cooled.
- Warner Bros. Discovery had reportedly explored splitting its linear assets from its streaming portfolio but ultimately decided selling smaller assets was a better solution than breaking up the company, per the Financial Times.
