Comcast Considers Cable Changes

Comcast Corp. is exploring spinning off its cable networks into a standalone company and is also open to partnerships with its streaming platform Peacock.

The Philadelphia Business Journal reports the media and technology conglomerate's cable networks include Bravo, USA Network, the NBC family of channels and Syfy, among others — though the legacy NBC channel would not be a part of the spinoff.

The networks are under the umbrella of Comcast's NBCUniversal division, which also includes production studios like DreamWorks and Universal Pictures, in addition to theme parks like the Universal Orlando Resort.

Michael Cavanaugh

Comcast President Michael Cavanagh said there "could be an opportunity to play some offense."

"We’re experiencing the effects of the transition of our video businesses and have been studying the best path forward for these assets,” Cavanagh said on the company's third quarter earnings call Thursday morning. "To that end, we are now exploring whether creating a new, well-capitalized company owned by our shareholders and comprised of our strong portfolio of cable networks would position them to take advantage of opportunities in the media landscape and create value for our shareholders."

Cavanagh added that Comcast will commence a study to determine if spinning off the cable networks is the right path, adding that the company is "not ready to talk about specifics."

"The reason we’re announcing here is that we want to study it," he said. "There are a lot of questions to which we don’t have answers."

If the spinoff materializes, Peacock would still be a part of Comcast's core business. Comcast, however, could look to partner with other streaming platforms, a move that has become increasingly common as the streaming industry gets more crowded and media giants look to consolidate content and bring in viewers. Cavanagh said that the company chose not to participate in the bidding for Paramount a couple of months ago, but it could be more active in seeking partners in the future for Peacock.

"We would consider partnerships in streaming despite their complexities," Cavanagh said. He added that partnerships in streaming can "be complicated," and there is a "high bar," but the company is "open to discussing partnerships."

Peacock has secured some major wins of late thanks to its coverage of the Paris Olympics and exclusive broadcasts of a handful of NFL games, but is still running at a loss. Peacock tallied $1.5 billion in revenue in the third quarter, an 82% increase over its $830 million revenue the year prior. However, it lost $436 million in the last three months, albeit smaller than the $565 million in the same period a year prior.

Total subscribers on the streaming platform increased 29% year-over-year in the third quarter to 36 million, with three million net additions in the third quarter alone, which included the Olympics coverage.