Warner Bros. Discovery CEO David Zaslav stated Donald Trump‘s re-election as president bodes effectively for media M&A.
“We now have an upcoming new administration,” the exec famous throughout WBD’s quarterly earnings name Thursday. “It’s too early to inform, however it could provide a tempo of change and a possibility for consolidation that could be fairly completely different, that would supply an actual optimistic and accelerated impression on this trade that’s wanted. These are nice firms. If the most effective content material goes to win, there must be some consolidation with a view to have these companies be stronger and have a greater shopper expertise.”
Zaslav’s feedback got here after WBD reported third-quarter outcomes, with streaming progress offset by a Barbie-less movie slate. He spoke with the conviction of somebody who not solely instructions a serious media firm but additionally the fervor of somebody who has fumbled with a distant management in the lounge.
“I’ve been saying for a very long time that that is an trade that actually must meaningfully consolidate,” he stated. “It’s actually pushed by the buyer expertise. Customers placed on their TV set they usually see 16 apps and every of these is doing completely different pricing, you’re sitting there together with your telephone and Googling the place a present is or the place a sport is. You’re going from one to a different, and there are such a lot of.”
Not solely, he continued, is the present setup “simply not shopper expertise – it’s not sustainable. There most likely ought to have been extra significant consolidation. … and also you’re beginning to see it now. You’re beginning to see pretty giant gamers saying, ‘Hey, perhaps I must be a part of you or perhaps I must be part of any individual else.’”
Towards this backdrop of “generational disruption,” in Zaslav’s phrases, WBD has saved its property intact within the two-and-a-half years because it was shaped, which is a distinct stance than rivals like Comcast and Paramount International. The previous is exploring a by-product of its cable community property and the latter has a pending merger in place with Skydance Media. On a decrease tier of market worth, Lionsgate has additionally pursued a break up of its studio and networks companies.
Discovery, which Zaslav ran for 15 years earlier than combining it with WarnerMedia in 2022, has been lively in recent times on the M&A entrance. In 2018, it acquired Scripps Networks Interactive, bringing unscripted networks like HGTV and Meals Community into the fold earlier than Zaslav started negotiating the mixture with WarnerMedia.
Whereas the CEO’s tackle Trump is shared by many within the enterprise world, the president-elect’s report on regulatory issues throughout his first time period was decidedly combined. For all of his pro-business pronouncements and business pursuits whereas in workplace, he did topic some firms to scrutiny, particularly within the tech sector. Zaslav’s predecessors overseeing the previous Time Warner properties additionally needed to deal with the efforts of Trump appointees on the Division of Justice to dam the corporate’s acquisition by AT&T. The DOJ’s lawsuit was finally rejected by a federal choose, permitting the $85 billion merger to shut in 2018.
