Comcast has floated the concept of spinning out its cable television channels into a separate company. The company is continuing to lose cable television subscribers, down by nearly 3.75 million in two years, while the number of Peacock subscribers has grown by 20 million over the same period.
The possible channel spin out would not include the NBC Network or the online service Peacock, but could involve any of the NBU Universal networks portfolio that includes brandds like Bravo, E!, Syfy, Oxygen, USA Network, and the news networks MSNBC and CNBC.
Many of the major media players have well-known television channel brands but are more focused on other things. The idea is that spinning them out will somehow allow them to be more successful, or at least be less of a distraction.
One possibility is that these stranded cable brands could be combined in some way as part of a consolidated offering.
Warner Bros Discovery and Paramount Global have recently written down the value of their cable television assets by a collective $15 billion.
Introducing quarterly earnings results, Mike Cavanagh, the president of Comcast Corporation, emphasised the growth in its internet access business, saying it is looking to maximise the significant legacy value in its portfolio of more mature businesses. He said that although it had not got involved with Paramount, it would consider partnerships in streaming.
“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. “To that end, we are now exploring whether creating a new well-capitalized company owned by our shareholders and comprised of our strong portfolio of cable networks would position them to take advantage of opportunities in the changing media landscape and create value for our shareholders.”
He talked of commencing a study of the idea of “creating a new well-capitalised company” that would go to existing shareholders “comprised of our cable portfolio networks.”
Meanwhile, Comcast continues to lose video subscribers. In the last quarter it lost another 365,000, to a total 12.83 million in the United States, down from 16.58 million in two years.
Comcast has also been losing broadband customers, with six sequential quarterly losses, although at lower level. It lost 79,000 residential broadband customers in the last quarter, which is down 331,000 over two years to 29.50 million.
The number of subscribers to its online service Peacock rose to 36 million, up 3 million in a quarter, and up from 16 million in two years. Peacock revenue rose to $1.5 billion but it is still losing money. It lost $436 million in the last three months and nearly $2.25 billion in a year.
Quarterly revenue for the media segment, mainly comprise of NBCUniversal television networks, was up nearly 37% to $8.23 billion, largely due to the Olympics.
Total Comcast consolidated revenue for the quarter was £32 billion, with total adjusted earnings of $9.34 billion.