Last week Discovery Communications' new president and CEO David Zaslav announced a sweeping reorganization for its wide array of 17 cable networks. His goal is to create "a leaner culture," corporate-speak for headcount reduction.
In an interview, he acknowledged that many cable content providers, not just Discovery, had lost focus on core brands in their quest for growth by creating a spate of niche networks. That was circa 1995, when digital technology created bandwith opportunities for cable programmers to expand existing brands by launching spinoff channels.
It was a land grab, the perfect stage to parlay carriage of newer and weaker networks in exchange for sweet carriage deals for strong channels like Discovery. But today, the chickens have come home to roost. Many of the new niche networks had no reason to exist. Viewers' interests were not given much thought, he said. And every cable network did it back then.
"But the audience lashed back and told us all that brands matter," Mr. Zaslov said, perhaps alluding to the mediocre ratings that many of the spinoff channels, not just his, have garnered to date. The creation of so many niche networks, I would say, left the Discovery Channel resting on its laurels, leading to a ratings decline.
The sweeping reorg-leaving several longtime Discovery executives in the dust-shocked some industry observers who had not expected him to move so quickly. After all, Mr. Zaslav was hired just last November to succeed longtime Discovery veteran Judith McHale. Although he didn't officially join Discovery until January, he said that he had spent the interim six weeks on "a self-imposed listening tour," talking with many Discovery executives and employees about what works and what doesn't.
So bye-bye to Billy Campbell, who was the company's president, and to Dawn McCall, who led the company's still wildly successful international operations. Also departing is Animal Planet General Manager Maureen Smith. Another casualty is Pandit Wright, who headed up human resources for 12 years. Separately, The Learning Channel President David Abraham resigned to take a new gig elsewhere.
Five network executive VP/general managers have been promoted to president/general managers, all directly reporting to Mr. Zaslav. In addition, Bill Goodwyn, who heads up affiliate sales, and Joe Abruzzese, who heads ad sales, will also report to him. Ms. Wright's successor, Adria Alpert-Romm, also will have direct access to Mr. Zaslav. Love these org charts, don't you?
Anyhow, Ms. Alpert-Romm is Mr. Zaslav's hand-picked hire from NBC TV Entertainment and News, and she's no stranger to cable. She earlier worked in human resources at both CNBC and MSNBC and later helped Mr. Zaslav with the integration of USA, Sci Fi Channel and Bravo into NBC Universal.
Meanwhile, another new face in the sandbox is Greg Ricca, formerly of MTV International, who replaces Ms. McCall. Other searches are under way to find heads for Discovery's newly created emerging networks operation and new business development.
My read? For now, Mr. Zaslav is going after the low-hanging fruit and plans to take other core brands, namely Discovery Science, abroad. Discovery and Animal Planet are wildy hot offshore. No-brainer there.
There are two other new factors at Discovery: hired consultants, who probably have the folks at headquarters sweating bricks. Tom Wolzein, who once ran the media practice for Sanford C. Bernstein, will help define growth strategies in new media platforms. And then there's Joel Berman, who was president of wordwide television distribution for Paramount Pictures and CBS/Paramount Television.
"We need to change from a cable company to a media company," Mr. Zaslav said, stressing that Discovery owns a great deal of its programming and should be getting more bang from its programming buck by repurposing or syndicating its content to other outlets. That's why Mr. Berman is there.
And one day we will learn exactly why Mr. Zaslav is there. I smell a sale, a public offering and/or a change in ownership. How about you?