“I don’t know that a lot specifically about this dispute, however it looks like it is a second,” mentioned Warner Bros. Discovery CEO David Zaslav in regards to the present showdown between huge cable supplier Constitution, and Disney.
“It’s not clear if it is a second that will get resolved rapidly and we’re again to having an trade that’s in secular decline … or whether or not it is a extra significant second,” he informed buyers at a Goldman Sachs media convention at present.
Constitution desires to pay much less for Disney content material, together with ESPN, in reality to restructure your entire settlement, and mentioned it’s going to search related phrases from all of its programming suppliers when contracts expire because the cable bundle continues to wither. Linear networks make up about half of WBD’s income.
Zaslav is conscious and mentioned his administration is doing what it might, specifically put together for a linear meltdown ever since Warner Bros. and Discovery merged 16 months in the past. He referred to as it a “relentless mission” to restructure “for the world we reside in at present.” The corporate’s channels are moderately priced, he mentioned throughout a Q&A, and, though the clock is ticking, WBD doesn’t have any carriage offers developing for renewal till 2025.
Re-launching Max, including an ad-light model, debuting reside CNN information on the streamer shortly, and, finally, including reside sports activities, is all a part of the push. So is paying down the corporate’s huge debt. It’s “command and management of all our property, together with IP” and “all of that work was to place ourselves able the place we had been prepared for a second identical to this.”
He praised CNN’s new chief Mark Thompson, former head of the BBC and the New York Occasions, as an amazing govt. On reside streaming sports activities, he mentioned an announcement is coming quickly.
Requested in regards to the ongoing Hollywood strikes, which have gone on longer than the corporate anticipated in its monetary steerage final quarter, Zaslav mentioned the work stoppages are “actually about individuals, and writers and actors which were out for a really lengthy time period. And we’re a content material firm, a storytelling firm. We have to do all we are able to to get individuals again to work. However, extra importantly, individuals should be compensated pretty and they should really feel valued.”
He famous that Warner Bros. pushed Dune: Half Two into 2024 because the strikes shuffle launch schedules. “We’re simply hopeful as an organization that we are able to get the strikes resolved.”
In the meantime, the prolonged strikes, by shutting down a lot manufacturing, are each serving to to spice up the corporate’s free money movement, and reducing into earnings. Yesterday, WBD modified its full-year 2023 monetary estimates to incorporate a revenue hit of as much as $500 million, however free money movement nicely above $5 billion, which was already the excessive finish of its earlier projection.
“It is going to be meaningfully greater than $5 [billion],” he mentioned.
“We’re simply hopeful as an organization that we are able to get the strikes resolved.” He famous that the corporate needed to push Dune: Half Two from November till March of 2024.
Extra to come back…