The US telecommunications giant Comcast announced plans to spin off cable networks including MSNBC and E! as traditional TV audiences continue to dwindle.
MSNBC, E!, CNBC, USA, Oxygen, SYFY and the Golf Channel will form part of a new, publicly traded company, while Comcast focuses on brands including NBC and Bravo.
“When you look at our assets, talented management team and balance sheet strength, we are able to set these businesses up for future growth,” said Brian L Roberts, chairman and CEO of Comcast.
The spun-off company will have “significant financial resources” from the outset, Roberts claimed, and be “ideally positioned for success and highly attractive to investors, content creators, distributors and potential partners”.
Shares in Comcast, which also owns the Xfinity wireless provider and Universal Pictures, the Hollywood movie studio, rose 1.7% during pre-market trading on Wall Street.
The rise of streaming, and the decline of cable subscriptions, have put significant pressure on cable networks. Comcast launched its own streaming platform, Peacock, in 2020 in a bid to take on the likes of Netflix, Amazon Prime and Disney.
Splitting MSNBC, the liberal news network, from NBC’s flagship news division is unlikely to be a straightforward task. The two businesses are closely intertwined, and share high-profile talent. There are also close ties between NBC News and CNBC, the financial news network.
MSNBC has faced intense scrutiny following the election victory of Donald Trump earlier this month. Ratings have dropped significantly in the aftermath of the result, while viewership of the rightwing Fox News held firm.
The spun-off business will also include the ticketing website Fandango and reviews website Rotten Tomatoes. Comcast said the company it is spinning off, which it dubbed “SpinCo”, generated $7bn in sales in the year to 30 September, although its announcement did not set out how this compared with previous years.
“This transaction positions both SpinCo and NBCUniversal to play offense in a changing media landscape,” claimed Mike Cavanagh, president of Comcast, who added that it would put Comcast’s NBCUniversal division “on a new growth trajectory”.
