Eight months in, the jury’s still out on Comcast’s merger with NBCUniversal in Hollywood.
Wall Street likes the shared progress by the paired companies, but NBCU’s recent track record is uneven: After a summer of hits and misfires, the film division recently torpedoed several pricey projects; and the network, now under the leadership of respected creative exec Robert Greenblatt, is still lodged in fourth place among four television networks with the new fall TV season about to begin.
Execs nonetheless maintain that the company is rushing toward a hopeful future as it approaches the merger’s one-year anniversary.
Also read: Comcast-NBCU Deal Done: $30B Later, Comcast Is Proud Owner of the Peacock
Emerging as plusses: the very aspects of the of the old-line Comcast culture that initially made Hollywood skeptical.
Comcast, a family business that Ralph Roberts began in the tinsel-free outpost of Tupelo, Miss., is a point of stability that investors large and small quite like. The cable giant, now run by son Brian (left), has the distribution apparatus to leverage content NBCU creates.
“During the first quarter [of 2011], there were some speed bumps, some issues that raised questions whether the new property could fit well into the Comcast culture,” entertainment analyst Tuna Amobi of Standard and Poor’s told TheWrap.
But with each passing month, Amobi said, “the acquisition is looking very fortuitous for Comcast. They’ve already started to reap a very significant upside.”
Such a result was not necessarily a sure thing. When the complex deal for Comcast to acquire NBCUniversal from General Electric for $30 billion (news first broken in TheWrap) closed in January of this year, GE chairman and CEO Jeff Immelt voiced his gratitude for the 11 percent returns the entertainment side had generated over the previous 20 years.
Also read: Exclusive: Comcast in Talks to Buy NBC-Universal
GE wanted the cash to beef up its “high-technology infrastructure” ventures. It retained a 49 percent interest in NBCU but set horizon dates to pay off the debt in two stages -- one at three years-and-a-half years out and one at seven years -- to sell that portion off to Comcast (with GE and Comcast splitting the profits gleaned).
In Hollywood, the bigger question was whether Comcast would be better suited to the vagaries of making hit film and TV shows (and the theme parks that feed off them) than the stodgy GE.
Whatever doubts the industry had about the status of Ron Meyer, who at 66 had been running the film studio and theme parks as Universal’s COO since 1995, began easing when the film arm enjoyed much-needed hits with “Fast Five” and “Bridesmaids.” The CEO’s contract was extended through 2015 in late June.
Meyer had already set the tone for his continuing tenure in 2009 by installing seasoned marketing head Adam Fogelson as chairman of the Worldwide Motion Picture Group to run the film slate, with Donna Langley and Rick Finkelstein joining him in a triumvirate.
