Thursday, 17 February 2022

Discovery Inc-WarnerMedia merger - Deadline: Peter Bart: The Deal Gets Real At WarnerMedia As David Zaslav Ponders Its Power Structure

Story from Deadline: 

David Zaslav, who is famously gregarious and high-energy, has been oddly quiet lately with an absence of media interviews or social events on his schedule. Even his regular booth at the Polo Lounge has been somnolent. 
That’s about to change: Zaslav arrived back in Hollywood yesterday and the industry has been forcefully reminded that “the deal” is real. 

As federal regulators and other random bureaucrats remove their barriers, the long-awaited entity called Warner Bros. Discovery becomes a functioning reality in four short weeks. 

There are high expectations of imminent moves that will impact the power structures spanning television, movies and news. 

For over a year the managements of Warner Bros, CNN, HBO and beyond have labored in a bureaucratic cloud, with executives implementing policies they knew were likely evanescent. 

So now starts the guessing game. Who will be anointed to fill the $43 billion power vacuum? Barred from occupying offices on the Warners lot or taking formal policy meetings, Zaslav has now concluded his yearlong “listening tour” and is mobilized for action. 

But here’s where history intrudes: It’s been 50 years since Steve Ross’ monomaniacal mergers led to the formation of the massive, if unstable, Time Warner empire. 

A one-time funeral director, Ross quickly assembled a band of pals and financial allies to run his new show, and it was party time. The appointments were celebrated with raucous trips to Acapulco. The fun had begun. 

That moment has passed. Zaslav’s appointments will likely receive a reserved response. As one rival CEO puts it, “Corporate power has become a mixed blessing.” 

Each of the new recruits will confront a fusillade of problems relating to politics, inclusion, diversity and sex. Time permitting, they may even have time to deal with movies and TV. 

Warners’ new company logo heralds “the stuff that dreams are made of,” but as one aide suggests: “Maybe good stuff, more often difficult stuff.” 

CNN represents a case in point. Zaslav was close to Jeff Zucker before Zucker’s high-decibel dismissal, which involved a mix of sexual politics (a female associate) and HR intrigue (his precipitous beheading by Jason Kilar, the WarnerMedia chief). 

Replacing the combative CNN chief will involve a nuanced decision: Should a future CNN dedicate itself to advocacy programming akin to MSNBC, or to a more measured objectivity? 

The “insider” newsletters and tip sheets bristle with rumors of departures including those of Kilar, touted as a techno-maven, and Ann Sarnoff, who registered little impact as chairman of WarnerMedia. 

Having heard it all on his “listening tour,” Zaslav is keenly aware of the mythic mistakes of past corporate owners. There was Viacom’s Sumner Redstone who hired his personal estate attorney to replace a respected CEO, Tom Freston, triggering the studio’s downward spiral. Kirk Kerkorian, though a brilliant trader, brought in David Begelman, an embezzler who had narrowly escaped jail, to run MGM. More recently, Warners’ board named Kevin Tsujihara to run Warners despite his apparent absence of “industry savvy.” 16-Giancarlo Parretti at least won industry plaudits for candor when, in 1990, he chose his 21-year-old daughter to become MGM’s financial chief. “She likes shopping in Beverly Hills,” he explained. 

The corporate transitions of the past have been both calm and calamitous. In the late 1970s a tough, uncompromising Arthur Krim pulled his entire management away from Transamerica to create a new entity called Orion, but he never recaptured the momentum of the former United Artists. 

By contrast, the network-trained Bob Daly quietly created a disciplined corporate environment when he moved from CBS to Warners in 1980, ultimately bringing in Terry Semel to share the production burden. 

“The Zaslav transition will be more like Daly’s,” observes one senior agent. “He has done his homework.” 

While the celebrations may be on hold, Zaslav is nonetheless completing work on his new Beverly Hills residence, which once belonged to Robert Evans – and became a symbol that smart deals could co-exist with glitzy parties. 

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