New Executive Team Focused On Streaming And Costs

Michael Hedges April 27, 2022 Follow on Twitter

When mergers and acquisitions close expectations and trepidations expressed through the weeks and months beforehand are either met or shrugged off. From investors and shareholders to customers and employees there is that moment when all eyes are on the new boss and team. Usually tensions felt when a deal first comes together have been erased. Nobody likes surprises.

Warner Bros Discovery (WBD) chief executive David Zaslav received a special bonus this week as first quarter financial results for Discovery, actually its final quarter, showed solid revenues and profits. The Discovery+ streaming platform gained 2 million subscribers quarter to quarter. The Beijing Winter Olympic Games boosted advertising and sub-licensing revenues.

In the requisite earnings call with WBD investors (April 26) he did not suffer the past. "Our mission is simple: to be the world's best storytellers, with world-class products for consumers.” He expanded: "We have no religion about any one platform or window versus another.” Just for investors, he added: "We will not overspend to drive subscriber growth. We are not trying to win the direct to consumer spending war." He did add a few digs at Netflix.

The same day Mr. Zaslav was praised by NATO. No, not that NATO. National Association of Theatre Owners president John Fithian, at the CinemaCon press conference, welcomed support of the exclusive theatrical window - theaters getting a head start on broadcasters. “David defined what it means.”

Discovery and telecom AT&T officially completed the spin-off of WarnerMedia April 8th creating Warner Bros Discovery. It was first announced about ten months earlier. Discovery, formerly Discovery Communications, paid US$43 billion, which AT&T said it would use to pay down debt. A “new media giant created,” headlined CNN media reporter Brian Stelter (April 11). Of course, global news network CNN is a significant part of the deal.

A new executive team was quickly revealed, almost entirely from Discovery. With a few exceptions WarnerMedia executives, mostly AT&T hires, departed. Two weeks later nobody remembers their names. Chief executive David Zaslav announced to employees “a simpler organizational structure with fewer layers, more accountability and more resources focused on the screen.” Said LightShed Partners media analyst Rich Greenfield: “(David) Zaslav and team find themselves in a position that was unimaginable two years ago, sitting near the top of Hollywood.”

And, so, it’s streaming that matters. The first major step for WBD is merging the Discovery+ and HBO Max platforms. For that Mr. Zaslav has entrusted JB Perrette, a longtime Discovery lieutenant. That development will certainly “take time,” as Mr. Zaslav told staff during his whirlwind tour of various sites. A combined streaming platform, say many observers, might look a lot like Discovery, bits of everything.

Not included is the CNN+ subscription streaming platform built on news and opinion content. It was declared dead (April 21), reported CNN, final broadcast April 30. The new WBD management had no love for CNN+, seeing it as an expensive distraction for the master plan “one streaming service” and, even, for CNN itself. Chief financial officer Gunnar Wiedenfels cited “inefficient spending.” The launch of CNN+, orchestrated during the pre-merger months, was always seen as rather odd. "Some of this was avoidable," said Mr. Perrette, but "prior leadership decided to just keep going.” Rumors abound about a possible closing of CNN Center in Atlanta, Georgia, hub of the operation since the Ted Turner days.

Shortly after calling quits on CNN+, Variety (April 26) reported WBD is “no longer developing new scripted content” for TNT and TBS, legacy cable channels from the Turner Broadcasting days. Comic book publisher DC Comics, a longtime Warner Brothers brand, is also, reportedly, in the crosshairs. “What good is DC Comics as a whole if the only thing selling, the only thing anyone cares about is Batman?” offered former DC comics artist Shane Davis to trade portal Boundingintocomics (April 26).

Speaking of Batman, WBD announced this week (April 26) plans for a sequel produced by Warner Bros Pictures. Director Matt Reeves is returning as is Robert Pattinson. Batman recently dropped off HBO Max after six weeks. The global box office take has reportedly been US$760 million.

See also...

• Hot Topics - Warner Bros Discovery

• Hot Topics - Streaming Media