A federal judge cleared the Comcast-NBC Universal deal today with the provision that the court will retain oversight of its effect on the online video market for the next two years. U.S. District Judge Richard Leon ruled in Washington that the Justice Dept and the new company must report on arbitration actions initiated by online video distributors such as Netflix or Hulu. The distributors had told the court they feared losing access to NBC content because of the merger. “Since neither the court nor the parties has a crystal ball to forecast” the effectiveness of the final judgment, the additional steps are necessary to protect the public interest, Leon wrote. The deal won approval Jan. 18 from U.S. regulators under an agreement with the FCC and Justice Dept. in a deal which required court approval of provisions regarding online video.
Here’s a deal that would reshape the online streaming business and set Netflix on its heels: Apple is “considering making a bid” for Hulu, Bloomberg reports today citing two people “with knowledge of the auction.” The story says that Steve Jobs’ company is “in early talks that may lead to an offer” which could come to more than $2B. But what’s just as interesting is that Disney, News Corp, and Comcast’s NBCUniversal are said to be telling all bidders that they’re prepared to continue providing programming to Hulu for five years — including two with exclusivity. Companies looking at Hulu have said that it would be hard to put a price tag on it without guaranteed programming. Now several are at least kicking the tires for the auction being run for Hulu by bankers Morgan Stanley and Guggenheim Partners. Yahoo is known to be interested. CEO Carol Bartz wouldn’t comment on Hulu when asked about it in a conference call with analysts on Tuesday. Amazon, Google, and Microsoft are also looking closely — although Bloomberg says that Microsoft’s interest is waning.
So Hulu’s for sale -– it has hired investment banks to find a buyer. But what, exactly, would a purchaser receive? The answer could be not much — unless Hulu can cut long-term and preferably exclusive deals for TV shows and movies from its main program suppliers and equity owners News Corp, Disney, and Comcast’s NBCUniversal. The problem is that those deals will be hard to strike before a sale. That means anyone buying Hulu would need deep pockets to buy new programming –- or to compete with Netflix and possibly other online services for existing entertainment. “Hulu’s real competitors are the cable companies,” says media investor and author Larry Kramer.
A sale would show that the vision that led to the creation of Hulu in 2008 has been a bust. At the time, the broadcast networks wanted a slick destination to offer ad-supported TV shows online. It was their best defense against seeing companies such as Apple and Google move in and dominate online video the way Apple has with online music. But ads haven’t materialized the way initial backers had hoped. Last year, the company created subscription service Hulu Plus. CEO Jason Kilar says more than 1 million customers will sign up for the $8-a-month product by year’s end.
Yet Hulu Plus is an also-ran against Netflix, which has 22.8 million domestic subscribers and is spending a fortune to license TV shows and movies. That’s one reason why it’s been so hard for Hulu’s existing owners to cut long-term deals with the company. They want Netflix’s cash. Disney CEO Bob Iger said last month that “we never believed that Hulu would end up … in an exclusive position as a distributor” for Disney’s entertainment. Read More »
NBC Broadcasting Chairman Ted Harbert made it clear that the company had entered the post-Jeff Zucker era with a zinger that the audience at the NBC Upfront Presentation fully understood. They applauded when he said that the company needs “a little less reinvention of the wheel and a lot more Broadcasting 101.” NBC Entertainment Chairman Bob Greenblatt says the specific goals are to become aggressive in developing sitcoms, reinvigorate Thursday night, and hit 10:00 PM “after it was almost abandoned a year ago” when Zucker put Jay Leno in — a strategy partially designed to save money; he added that there’s no mandate to manage for margins or to script. Comcast has said that it will spend an additional $200 million this year on NBC’s prime time shows. (Catching up with Comcast chairman and CEO Brian Roberts and NBCUniversal CEO Steve Burke, they said the network won’t require any more of an influx than that. “It won’t be needed,” Roberts said. Added Burke: “It’s not so much the money, it’s the shows.”)
Greenblatt says that the network is approaching its reinvigotation as “a marathon, not a sprint.” Roberts said the “biggest change is the energy and enthusiasm,” and Burke added that the message they want to send out is “we want to hire the best people.” The company stuck to platitudes during the presentation — execs didn’t start off sharing any ratings goals. Greenblatt says, though, that NBC’s hit show The Voice will “dramatically redefine … Read More »
Time Warner Jeff Bewkes comes across as the media world’s most laid-back CEO. But he asked a lot this morning when he told movie theater owners to cool their jets about Premium VOD. “There’s been too much excitement about this,” Bewkes said at a panel discussion sponsored by investment firm Jefferies & Co. “Our interests are aligned.” That will come as a surprise to the National Association of Theater Owners and its members who loathe PVOD as much as the Tea Party hates taxes. Exhibitors say many would-be ticket buyers will wait to watch films at home as studios including Warner Bros begin to offer 8-week-old releases on cable and satellite VOD services for about $30 a showing. Bewkes says theater owners are wrong: “I’m saying (box office revenue) doesn’t go down.” Everyone will suffer, he says, if the studios can’t provide an alternative to pirates who sell bootlegged copies of recent movies to people who don’t want to wait for the official home video release. Other panel members — none of them exhibitors — supported Bewkes. CBS chief Les Moonves said that although theater owners are scared, “you have to change a bit.” And Sony Corporation of America CFO Robert Wiesenthal said that “everybody is experimenting and being aggressive,” even though studios should recognize that theaters are “the foundation of the economic value chain for a feature film.” Read More »
This morning, the top Comcast execs in an earnings conference call admitted to Wall Street that NBCUniversal, which the company just purchased, is a fixer-upper and, in the short term, a money pit. NBCU chief Steve Burke says the company plans to spend $200 million more this year on NBC’s primetime schedule than General Electric did last year when it owned the network. (Burke is looking at 21 pilots, about the same number NBC ordered in 2010.) Comcast considers the turnaround to be a long-term project, but Burke says that simply lifting NBC to third place from fourth would mean “hundreds of millions” in improvement in the company’s cash flow. Meanwhile, Burke also says he plans to spend $100 million more this year on programming NBCU’s cable networks. He expects a “very strong” upfront ad sales season.
As for Universal’s film business, where 1Q revenues and operating cash flow declined, Burke says that “we have to make better films,” although the size of its current slate is “about right.” He attributed some of the woes to the fact that the company had to include a lot of marketing costs for Hop and Fast Five in the latest quarterly report even though most of the revenues from those recently released films will show up on Comcast’s next earnings statement.
Both Burke and Roberts mentioned the “S” word — synergy — which hasn’t been used by Big Media since the days of AOL Time Warner. And we all know how that turned out. Read More »
A trio of senior NBC Universal executives for Lauren Zalaznick’s Women & Lifestyle Entertainment Networks have been given expanded responsibilities at the bigger group overseen by Zalaznick post-merger, NBCUniversal Entertainment & Digital Networks and Integrated Media. Cameron Blanchard, previously SVP of communications, and Tony Cardinale, previously SVP of strategic insights, have been named EVPs for the new division, which includes Telemundo, mun2, Bravo Media, Oxygen Media, Style, Sprout, ExerciseTV, TV One, iVillage, Daily Candy, Swirl, Fandango and the Integrated Strategic Marketing group. Additionally, Margaret Lazo has retained her title of EVP human resources and will relocate from Los Angeles to New York City to take over her expanded role. All three will continue to report to Zalaznick.
A holding company that oversees the theme parks said in a regulatory filing this week that the private-equity group has offered to sell its 50% stake in the Florida parks to NBC Universal, which owns the rest of the venture. Comcast-owned NBCU has until June 12 to make a call on that offer; after that, Blackstone can try and sell off all of Universal Orlando to a third party.
With Comcast’s acquisition of NBC Universal completed, the newly formed NBC Sports Group – which consists of NBC Sports, Golf Channel, VERSUS and 11 Comcast regional sports networks – this morning unveiled its executive structure under chairman Dick Ebersol. Turner veteran Mark Lazarus, who has long been rumored to take run the new group’s cable properties, is the only outsider on the team, while NBC Sports execs are being given the reins of Comcast’s Versus and Golf Channel. Here is a rundown of the new exec hierarchy: Read More »
Going to work this morning, NBC Universal employees found all the company’s old signs replaced overnight with new ones. They feature the company’s new logo and new name, which is the same as the old one sans a space between the two words, NBCUniversal. (The TV networks, NBC, CNBC and MSNBC are not getting a logo overhaul, keeping the peacock intact.) Along with the new signage and new Intranet system, employees were greeted by gift boxes on their desks. The Welcome memo below explains the contents of each box, which included beautifully crafted books about the history of the merging companies, a stocks certificate for 25 Comcast shares and free passes to the Universal Theme Parks:
Today marks the birth of the new NBCUniversal. Together, Comcast and NBCUniversal are poised to become the greatest media company in the world, delivering quality content to a global audience on every conceivable platform.
We are incredibly excited about this opportunity. We’re humbled, too, since we are keenly aware that NBC and Universal both have tremendous legacies, reaching back nearly a century.
Although only half as old, Comcast also has a proud history, having grown from a single system cable operator to the largest video and residential Internet service provider in the country.
As we embark on this adventure together, it seems like a good time to reflect on how we got here. That’s why we put this
… Read More »
UPDATED: Comcast today held town hall meetings for NBC Universal employees in NBCU’s main outposts, New York and Los Angeles, and Comcast’s hometown Philadelphia, with remotes from Miami and London. Comcast officially unveiled the new logo for NBCUniversal (all one word) which is how it will be spelled from now on. The redesigned NBCU logo uses purple as the primary color, with the peacock and the globe both gone. However, the NBC network logo will remain unchanged, so no one should call the ASPCA in search of the beloved bird.
Brian Williams hosted the main event in New York attended by new NBCU CEO Steve Burke and 90-year-old Comcast co-founder Ralph J. Roberts who choked up giving a heartfelt speech about seeing his dream come true with the NBCU acquisition. The Los Angeles meeting went Hollywood with Ryan Seacrest, a Comcast man via his E! deal, as the host. Ralph Roberts’ son Brian was there, as well as Universal Studios president Ron Meyer and new NBC chairman Bob Greenblatt. The Philly meeting is hosted by CNBC’s Jim Cramer, with Comcast CFO Michael Angelakis and Comcast Cable head Neil Smit attending…. Read More »
Vivendi has officially divested itself from NBC Universal, selling the remaining portion of its 20% stake in the company back to General Electric before the merger with Comcast is officially complete on Friday. The price: Vivendi received a total of $5.8 billion for the 20% stake. In a statement, Vivendi CEO Jean-Bernard Levy said, “We are very satisfied that our objective to exit NBC Universal has been completed. Vivendi is fully focused on pursuing its profitable growth strategy.”
Three years ago, in the middle of the writers strike, NBC Uni CEO Jeff Zucker made big headlines with his NATPE keynote speech, in which he declared the broadcast model dead and touted two new NBC initiatives that he thought would revolutionize the TV business: the dismantlement of pilot season, with the network going straight to series on most projects instead, and the elimination of the formal upfront presentation, with NBC brass pitching advertisers at small gatherings instead.
Well, that was then. In one of his final appearances as CEO of NBCU, Zucker today returned to NATPE for a Q&A session conducted by his brother-in-law, Nomura Securities’ Michael Nathanson. Zucker was not asked about the 2008 appearance or the two NBC initiatives, both of which have long been scrapped. But according to news reports from the session, he was asked to comment on the abrupt departure of MSNBC anchor Keith Olbermann. Zucker would not comment on Olbermann’s exit but praised him as a main driver of the cable news channel’s success. Zucker called Netflix a replacement for “the back-end syndication model for some shows that had gone away.” He wouldn’t comment on his plans for the future but reiterated his love for producing, news and sports. Zucker’s last day at NBCU is Friday. He said he is looking forward to Monday when he will wake up with nothing to do.
A Philadelphia Inquirer report recounts how the Comcast team locked in on FCC Democrat Mignon Clyburn, who joined the commission in 2009 and who was one of the five who eventually decided if Comcast should get NBC Universal. Comcast strategists studied the members of the FCC and came to the conclusion that Clyburn would be a key deciding vote. So in a textbook case of lobbying, they set out to woo her by making constant and repetetive hard promises that the newly-formed media conglomerate would be a kind-and-gentle corporation. It worked, and she cast a ‘yes’ vote. As it was, the final vote was 4-1 in favor of the marriage.
NBC Universal TV Group Chief Marketing Officer John Miller is joining NBCU’s sports division to create and head The NBC Sports Agency immediately following the pending acquisition of NBCU by Comcast. After 25 years of running marketing for NBC, Miller in June stepped down as president of The NBC Agency to focus full-time on the NBCU-Comcast integration while remaining as CMO. At the time, he moved to the East Coast and was planning to retire at the end of the year. But he is now back in the marketing game full-time with The NBC Sports Agency. The new entity will be modeled after the he NBC Agency, which Miller co-founded and led from 1999-2010. It will focus on marketing NBC Sports Group assets, including soon-to-be-integrated Comcast properties, and serve as an agency for NBC Sports’ partners and advertisers. While at NBC, Miller, who is credited with creating the ubiquitous “Must See TV” campaign and branding such hit shows as Seinfeld, Friends, ER and The Cosby Show, also creating campaigns for the Olympics and Sunday Night Football.
It was a memo like any other released by a CEO of a public company on the day the company’s quarterly earnings report is out. But this morning’s message by outgoing NBC Universal CEO Jeff Zucker about the company’s 4th quarter earnings ended on a farewell note as it comes a week before the completion of the Comcast-NBCU merger that will see Zucker replaced by Comcast’s Steve Burke. Here is what Zucker wrote:
As you know, the deal will formally close next Friday. That means this will be my last business update and indeed my last official word to each of you as CEO. Over the last few months, I made an effort to gather with every group of employees across the company. Hopefully, I’ve had a chance to meet and thank you personally for all you have done for this company. If I didn’t get to you, please accept my thanks now. I have been asked many times what I will miss the most about NBC Universal. That’s easy. The wonderful people of this company. So many colleagues…so many friends. I will miss you all.
It has been a fantastic run of almost 25 years. For me, that chapter’s ending, but for all of you it’s an exciting new beginning. With Comcast, I leave you in good hands and have no doubt that you will continue to do great things. I look forward to following your progress.
With warm regards,
While the Comcast-NBC Universal deal is supposed to close next week now that it has received FCC approval, NBCU’s fourth quarter revenue rose to $4.8 billion (up 12%), and profit saw a 38% gain to $830 million powered by a Big Media-wide advertising rebound that boosted the bottom line across the company. NBC-Universal’s quarterly and yearly performance was announced as part of the latest General Electric results. GE boss Jeff Immelt called the strong fourth quarter “a pretty good precursor” for 2011, citing the bounce-back in the economy as a main factor for continued growth. “The environment continues to improve,” he said. “We think the economy can get a little stronger every day.” GE will give up its majority stake in the company when the Comcast deal closes next Friday but its bottom line still will be affected. For NBCU, the cable and broadcast sides were strong: Cable revenues grew 15%, and the broadcast side’s revenues grew 11%. Even though the quarter was robust, the year was still saw, as profit stood at $2.26 billion. NBC-U’s parent company, General Electric, posted net earnings of $4.46 billion, up from $2.94 billion last year. Quarterly revenues were almost flat at $41.4 billion. GE does expect a heavy tax rate in 2011, due to gains from the sale of NBC-U to Comcast. Immelt himself has a new additional role: he’s just been named by President Obama to head the new White House Council on Jobs and Competitiveness.