NBCUniversal to split from Comcast

Old media is in trouble. The mega-media business model that was hugely profitable in the 90s-2000s no longer works. This is the same reason Disney caved and decided to license a new Disney travel destination in the UAE, where they have been trying to stay away from for decades. At this point the travel business it the most consistent and reliably profitable thing both these companies have.

So Comcast (like all of Universal's past parent companies) wants out of the parks business.

TH Creative - June 24, 2020: "I don't think Comcast is looking to part with the (parks) division ... Yet.

"But if they scrap Epic Universe or its opening is delayed until 2025 ... Yeah, I could see them putting it on the market. It's been done before ... Multiple times.

"I want Comcast to hold on to the parks because that is the kind of stability the Central Florida economy needs. However, the UO resort's history demonstrates (multiple times) that their parent company has elected to dump the parks."

I'm curious to see if this new Kabletown free property will remain a stand alone entity. Though NBC Universal's heavy investment in experiences may be a detriment to a tech company like Apple or Amazon, the spin off could appeal to the recently spurned Netflix. The best case scenario for fans of the Universal Parks would be a merger with WB if the Paramount Skydance acquisition fails. And of course, one can never count out The Sheinhardt Wig Company.

Robert should post a timeline listing all of the companies that have owned the Comcast ... um, Universal parks over the years. I think they were owned by Waffle House at one point.

(Chuckle)

"So Comcast (like all of Universal's past parent companies) wants out of the parks business."

I don't read that from this split. I think they want out of the overall entertainment production/creative business since the unit they're splitting off not only includes the theme park division, but also the movie and TV production side of the house. In my view, this is a separation of the "utility" from the rest of the business, and is pretty meaningless for the parks. Now, if the NBCUniversal splits further or spins off the theme park division, then we'd have something to talk about here.

I think in general right now, companies from various industries are making maneuvers to improve predictability, and selling entertainment is becoming an increasingly difficult business to forecast with constant ebbs and flows of costs and revenue. Utilities (cable, wireless, and other services) are very easy to manage and dependable in terms of profit, separating that from the volatile entertainment products, should stabilize Comcast's valuation/stock price.

Frankly, this is not much different from what Disney has been pondering over the past few years with the proposed split of ESPN from their core entertainment business given the volatility and capital intensive nature of broadcasting live sports. Frankly, I think some of ESPN's recent moves appear to have been made to prove the point that it needs to be split off from Disney (or at least away from the rest of the entertainment division).

I find it very difficult to believe that NBC/Universal has enough gas to go it alone. The parks are a cash-flow model -- labor intensive, demanding new (and VERY expensive) attractions to attract/maintain an audience.

Their gonna need a deep-pocketed parent company before too long. Zuckerman? Bezos? Musk?

Yeesh!

Is this the rise of NBC page Kenneth?

So who is buying Comcast’s cable division or who is merging with NBC/Universal? These are the only reasons this is happening.

Somewhere, Bob Chapek is staring at his checkbook balance and whispering, "I'll show them a thing or two".

"I find it very difficult to believe that NBC/Universal has enough gas to go it alone. The parks are a cash-flow model -- labor intensive, demanding new (and VERY expensive) attractions to attract/maintain an audience."

Why do you say that? Disney operates theme parks and finances TV/movie production, and they don't seem to be having cash problems. Do you think Comcast is knee-capping NBC/Universal by not giving them some seed money to maintain their enterprise - I doubt that since Comcast is still maintaining nearly 20% stake in the spun-off company? I don't think NBC/Universal has been behaving as a "cash-poor" company, and Comcast had not indicated any sort of cash infusion that originated from outside the segment to fund/finance any recent projects.

@Russell: Well I'd start with the fact that the Universal parks (brand) have a history of changing parents. (Vivendi, Blackstone, MCA, etc.). Second, at least as far as the parks are concerned, Disney is in a better place when it comes to the development of attractions. On a previous thread you and I concurred that Josh D'Maro and Dana Walden were in a strong place because their future projects were locked in. Disney's streaming service is operating in the black. Disney's debt load is lower ($48 billion vs. $94 billion). And Disney rides on a massive multi-faceted, international infrastructure that was built over the course of a century.

But hey, you could be right. Maybe NBC/Universal won't seek a partner. I just don't see it.

I would tend to agree TH, but I think this is just a way for Comcast to optimize their company's true value by separating their core "utility" business that offers financial certainty and predictability and their entertainment business that is far more volatile. We're seeing unprecedented shifts in the entertainment industry (the WB acquisition by Skydance/Paramount being the most recent seismic shift), so the only sure thing right now is there will be uncertainty moving forward.

It's altogether possible that this split is a planned precursor to NBC/Universal being acquired (my money would be on Netflix after they lost out on WB), but I think they're fine remaining autonomous.

Also, let's clear up this nonsense regarding shifting ownership in Universal's theme park brand. Comcast initially acquired NBC/Universal in 2011 and gained full control of the company in 2013. That's 15 years where the parks were under the same ownership. Yes, there was a revolving door in the 90's and 00's with Seagrams/MCA, Blackstone, and Vivendi taking turns over a @20 year period before Comcast came along, but the past 15+ years has brought plenty of stability and growth under Comcast.

Companies do this all the time.

GE did this:
GE Aerospace: The aviation and jet engine division. It retained the historic GE name and stock ticker (NYSE: GE).

GE HealthCare: The medical technology division, which was spun off first and trades on the Nasdaq (NASDAQ: GEHC).

GE Vernova: The energy and power division, which handles the energy transition and trades on the NYSE (NYSE: GEV).

So, did anyone actually watch CNBC this morning? It would have answered these questions for you. Brian Roberts had his hand forced on this move. The Comcast assets are the ones that are being devalued, not the NBCU (including the parks.) Owning cable that goes to a home is not really a growth industry, and there are more and more potential competitors as analysts were speculating that SpaceX will get into WiFi/content delivery business through their fleet of satellites.

Looking at NBCU's assets and comparing them to the valuation the WB Discovery just got... there is way more value in the NBCU side of this business. They've already spun off the "less desirable" cable channel assets (basically almost all of the cable assets minus Bravo) as Versant.

This is most definitely not an asset drop of the parks, as they were considered a valuable part of the NBCU side of the new business that is being spun off.

@TH Creative - Here is a list of Universal's historical owners (according to AI which is sometimes wrong):
- Laemmle - 1912–1936
- Standard Capital - 1936-1952
- Decca Records - 1952–1962
- MCA Inc. - 1962–1990
- Matsushta Electric - 1990–1995
- Seagram - 1995–2000
- Vivendi - 2000-2004
- General Electric/Vivendi - 2004-2011
- Comcast - 2011–Present

(TPI's software won't allow full name of Japanese company because if you add the "i" it is too "salty".)

@Beacher: Here is a list of Disney's historical owners:

Disney Brothers Cartoon Studio (1923–1926)
Walt Disney Studio (1926–1929)
Walt Disney Productions (1929-1986)
Walt Disney Company (1986-Present)

Don't worry, Chad H, I caught your 30 rock reference. Can we all agree to talk about it more? Are we all cowabunga on this?

VelocicoasterFan - An idea that's off the charts, kemosabe.

TH still trying to rile up someone with the "Comcast" comments instead of "Universal"... yikes. It's been 13 years rent free. Let it go already.

@ VelicoasterFan, I was just rewatching some 30 rock the other day, and in the first episode with Devin Banks we’re told he invented the 10 second micro sitcom for streaming… oddly prophetic

But if we pool our monies together along with a crowd funding - we the people of TPI might be able to buy Universal.....

Just think TPI coaster, TPI food, TPI games....Maybe a bouncy house called Bobby's bounce house for the Little ones named after Robert.

Or maybe the super intelligent President can buy Universal (Since he is doing such a great job with a state fair and a pool of green haze)
I put this here just to piss off the MLB's and Tim's of the world...

HAHAHAHAHAHA

Hmmm ... Netflix buys NBC/Universal? That would sure make Paramount's overpayment for WB look pretty stupid.

It would also give Disney an actual competitor.

Speaking of living rent free in someone's head...

Wow MLB must be using that new Trump phone with the missing stripes on the flag, the one made in the US oops made in Chiner BUT with Americans in mind

HHAHAHAHAHA

I can even make this crap up if I tried..... HAHAHAHAHAAH

Or add another confederate flag.....

Brian, you're insufferable, but not for the reasons you think or assume. Can we just have a nice chat about the Kabletown split without you trying to hijack the conversation with something completely unrelated?
I don't think NBC Universal will need a partner, but that said, I also wouldn't be surprised if another big company with deep pockets sees this as an opportunity.