Earlier this yr, Warner Bros. Discovery Chief Government Officer David Zaslav ended his firm’s lengthy relationship with the Nationwide Basketball Affiliation. Now, he could also be setting the stage to finish his relationship with U.S. sports activities, altogether.
WBD introduced Monday it is splitting itself into two corporations — an idea CNBC first reported had picked up steam in April. One firm, quickly referred to as Streaming and Studios, will include Warner Bros. Tv, Warner Bros. Movement Image Group, DC Studios, HBO and HBO Max. The opposite, presently dubbed International Networks, would be the remainder of the corporate’s belongings: legacy cable networks, TNT Sports activities, digital merchandise and free-to-air channels in Europe.
Zaslav would be the CEO of Streaming and Studios. Gunnar Wiedenfels, the present Warner Bros. Discovery Chief Monetary Officer, will change into the CEO of International Networks.
The divorce raises the query of the place stay sports activities proper held by TNT will land with out Warner Bros. Discovery’s streaming portfolio as a part of the identical firm.
Throughout a convention name Monday, Zaslav stated it is going to be as much as Wiedenfels and his staff to resolve the place they’d wish to license TNT Sports activities programming to the Streaming and Studios enterprise — or anybody else —sooner or later.
Presently, all of TNT Sports activities seem on HBO Max, Warner Bros. Discovery’s flagship streaming service. Zaslav stated U.S. sports activities have not been a significant driver of HBO Max sign-ups, suggesting that it might make sense for TNT Sports activities to consciously uncouple from the streaming service down the street.
“Contained in the U.S., sports activities have been much less vital,” Zaslav stated on the decision with buyers Monday. “It is considered, nevertheless it hasn’t been an actual driver for us. So it’ll proceed to be on HBO Max, however the International Networks enterprise will consider over time the place the most effective place for that’s.”
HBO Max will proceed to license sports activities for current offers. Nonetheless, Wiedenfels can have choices on find out how to monetize TNT’s future streaming and digital sports activities rights. He may strike a licensing take care of a unique media firm for the stay sports activities that seem on the Turner networks (TNT, TBS and TruTV), such because the NCAA’s March Insanity, the French Open, NASCAR, Main League Baseball and the Nationwide Hockey League.
“The U.S. sports activities rights will reside on the International Networks, and its administration staff will decide how finest to monetize the streaming and digital rights over time,” stated Wiedenfels. “Internationally, sports activities will largely coexist, each on linear and streaming, as they do right this moment.”
Or, he may resolve to merge TNT Sports activities with one other entity, such because the forthcoming Comcast spinout, Versant. Mark Lazarus, Versant’s CEO, informed CNBC Sport final month he was fascinated by bidding on sports activities rights to realize distribution heft with pay-TV operators. Buying TNT Sports activities might be a significant step in that route.
If Wiedenfels opts for consolidation, he should weigh the tax results of promoting off belongings after the separation takes place. Whereas Warner Bros. Discovery famous the break up is tax-free, Wiedenfels emphasised on Monday’s name that transactions may start as quickly because the separation happens, which is predicted by mid-2026.
“On the tax facet, I stated this earlier, I wish to be completely clear: As soon as this deal closes, each corporations are going to be free and clear,” Wiedenfels stated. “There isn’t any minimal time.”
A spokesperson for Versant declined to remark.
Disclosure: Comcast is the father or mother firm of CNBC. Versant will change into the father or mother firm of CNBC when the spinout is full.
