What Comcast's Cable Spinoff Really Means to the TV Industry

It’s official. Comcast will spin off its cable network channels, the company confirmed on Wednesday. The networks being spun off into a new company include USA Network, CNBC, MSNBC, E!, SYFY, and the Golf Channel. The split also includes Fandango and Rotten Tomatoes, GolfNow, and Sports Engine, according to a company memo sent from Comcast Corp. president Mike Cavanagh. However, several of NBCUniversal's assets will remain with Comcast, including NBC, Peacock, and Bravo. Mark Lazarus, current chairman of NBCUniversal Media Group, will serve as the new company’s CEO, and Anand Kini, current CFO of NBCUniversal and evp of corporate strategy at Comcast, will be the company's CFO and chief operating officer. The news comes after Comcast executives announced they were exploring a cable network spinoff in an earnings call last month, and it seemingly continues the ongoing TV industry trend of mass linear consolidation, according to experts. Ross Benes, a senior analyst with eMarketer, said spinning off the cable networks into its own entity will make it easier to sell for Comcast. "Getting rid of cable networks will make it easy for Comcast to highlight its more profitable ISP and mobile divisions," Benes told ADWEEK. "Even though Comcast is one of the largest pay-TV operators, the writing on the wall is clear—cable channels are a declining asset." Benes added that those likely to buy the cable channels are private equity firms or other media conglomerates. "Private equity would have an easier time hiding financial losses from a purchase than public companies would," Benes said. "Private equity buyers would cut costs and wrangle out what value is left of the networks, attempting to squeeze out quick profits while leaving a desiccated husk behind." Meanwhile, Benes said media conglomerates would "be interested in adding these networks to their collection of entertainment channels, either to add programming to their streaming services or to boost their linear TV ad sales." In addition, the move will likely change Peacock's relationship with NBCU cable stations. "The sold stations won't feed their programming to Peacock as directly under different owners," Benes said. "But Peacock's reliance on content from broadcast network NBC will likely stay strong and unchanged." Where things are heading With linear ratings continually declining outside of sports and consumers cutting the cord, Mike Proulx, vice president and research director at Forrester, noted that the spinoff of Comcast's cable networks and other properties is simply a reconciliation of assets that detract from the company’s inevitable all-streaming future. "The proliferation of streaming services have exacerbated the fragmentation of 'TV’ audiences, and it’s no secret that cable networks who can’t make the leap to steaming have an expiration date," Proulx said. Warner Bros. Discovery and Paramount each took multibillion-dollar write-downs from their depreciating linear businesses in 2024, and that trend doesn't appear to be slowing down anytime soon. With that in mind, Comcast's cable spinoff is just the next step in the TV industry's ongoing linear downsizing, according to Paul Verna, vp of content at eMarketer. As to what the future holds for the TV industry, Verna offers one certainty: "Consolidation is inevitable."

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What the Comcast Cable Spinoff Really Means to the TV Industry

Analysts said the move was inevitable as consumers continue to cut the cord

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