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For 15 years, Comcast believed that owning the distribution and programming was the winning formula in media. Now it admits that the strategy didn’t pay off.
The company announced it will spin off NBCUniversal — home to Universal Pictures, NBC, Peacock, Bravo, Telemundo and Sky — into a separate publicly traded company, according to the New York Times. The deal is expected to close within a year. Comcast will retain a 19.9% stake before monetizing it over time.
Wall Street was all-in on the decision. Comcast stock surged 23% on the news, after spending 13 years going nowhere. Analyst Rich Greenfield of LightShed Partners told The Times: “This is an admission that the status quo was not working.”
The spinoff is Comcast’s second major media breakup in less than two years. Earlier this year it spun off its cable channels, including MSNBC and CNBC, into a separate company called Versant. It’s part of a broader trend of media companies cutting loose their lumbering cable TV businesses and separating them from their faster-moving streaming services.
As for NBCUniversal’s future as an independent company, analysts are already speculating that Netflix, which lost the bidding war for Warner Bros. Discovery, could come calling.