Comcast (CMCSA) announced Wednesday that it would spin off its cable channels such as USA Network, CNBC, and MSNBC, while Peacock and other properties remain with Comcast. Earlier in October, the media giant indicated that such a step would follow, which is now official. Cable networks are seeing lower audiences and advertising,g while streaming channels are increasing viewership and advertising revenues. Shares have risen by 1.7 percent in premarket tradings.
Comcast said it would separate its entertainment channels from its cable channels such as MSNBC, CNBC, USA, Oxygen, E!, Golf Channels, and Syfy. Mike Lazarus, the current chairman of NBCUniversal Group, will be CEO of the new company created within a year.
Comcast CEO Brian Roberts said the new company will be temporarily called “SpinCo.” It is expected to reach roughly 70 million households in the US.
Roberts also said, “With significant financial resources from day one, SpinCo will be ideally positioned for success and highly attractive to investors, content creators, distributors, and potential partners.”
Analysts, including some from CWEB, think that the new entity, expected to be financially sound, might acquire other cable channels and offer more attractive cable bundles to viewers, as combining cable and streaming in bundles has not proven to be a huge success.
Cable television channels have steadily been losing audiences as web fans gravitate towards new media, mainly streaming, which is becoming popular across all age groups after live events such as the Olympics 2024 gave Comcast’s streaming channel Peacock a huge boost in viewership.
Comcast will retain Peacock, its theme parks, and some NBC properties, including NBC broadcast network, NBC News, NBC Sports, Bravo, film and television studios, and others.
Other media giants, including Paramount and Disney, have also considered similar steps concerning their cable channels. Comcast is the latest media giant to split legacy channels from streaming as these channels lag behind their modern communications, news, and entertainment counterparts in terms of growth and new viewers.
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