Comcast to Spin Off Cable-TV Channels, Reducing Exposure to Declining Business
In a strategic move to refocus its business, Comcast Corp. is planning to spin off its cable-TV channels, including MSNBC, CNBC, and USA, according to a person familiar with the company’s plans. This decision comes as the cable-TV industry faces declining viewership and advertising revenue.
A Shift in Focus
By spinning off these channels, Comcast aims to reduce its exposure to a business that has been struggling to maintain its audience and attract advertisers. The move will allow the company to concentrate on its NBC broadcast network and Peacock streaming TV business, which will remain under the parent company’s umbrella.
Bravo to Stay with Comcast
Bravo, a popular cable channel known for its reality TV shows, will also remain with Comcast due to its strong performance on streaming platforms. The networks being separated generate approximately $7 billion in annual revenue, according to reports.
New Leadership Structure
As part of the spinoff, Mark Lazarus, the current chairman of NBCUniversal’s media group, will take on the role of CEO of the new company. Additionally, Comcast is planning other management changes, including the promotion of Donna Langley to chairman of NBCUniversal Entertainment & Studios and Matt Strauss to oversee the company’s direct-to-consumer streaming businesses.
Comcast Shares Rise
Investors reacted positively to the news, with Comcast shares increasing 2.6% in premarket trading on Wednesday. Despite a decline of 1.6% on Tuesday, the stock is still down 3.5% so far this year.
A Well-Capitalized New Company
The new company, which will be distributed to existing Comcast shareholders, will be well-capitalized and positioned to make strategic acquisitions of related assets. According to President Michael Cavanagh, “We think there could be an opportunity to play some offense… We think we have great assets and a great balance sheet, and that’s the thinking.”
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