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Marianne Paskowski



'Zorro' Prepping for Discovery Sale?

May 18, 2007 3:27 PM

Consider myself among the folks who are asking that question as “Zorro,” my new name for Discovery Communications’ chieftan David Zaslav continues to swashbuckle his way through the company, this time announcing that come fall, it will close down its 103 retail units, leaving another 1,000 employees out of work. That’s long overdue because the stores are more like mini-museums rather than true retail outlets, and are money losers, located in high-end malls and pricey locales like New York City’s Grand Central Station.

The news about walking away from retail, however, does come on the heals of earlier cost cutting at Discovery, as “Zorro” laid off 200 employees, and insiders and outsiders alike, say they expect to see more “Marks of the Z,” if you will, sometime in June.

On top of that Discovery had just sold its 25 percent stake in The Travel Channel to Cox Communications, suggesting the company is trying to make the bottom line more attractive to would-be-buyers. To Wall Street, all of that activity signals that Discovery might be for sale in the not too distant future.

So what media biggie would make for a good fit? Let’s hear from the oddsmakers out there. Disney could be a nice fit, given its family-friendly orientation.

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Comments (12)

Apollo:

Welcome back. Stirring up trouble as usual. Are you sure zorro is dressing discovery up for sale? Or, is he running it more rationally?

Marianne Paskowski:

Good to be back here and elsewhere. Zorro, I think, is actually doing both. Remember he works for Liberty Media Holdings John Malone (50 percent stake) who sold off TCI to AT&T like swamp land, meaning, lots of cuts and no capital spending. I'm not hearing a lot about investments at Discovery on my vine, just cut, cut, cut.
You know, the original Zorro was a good guy, fought for the working class. This Zorro is fighting for shareholder value. Personally, I'm getting sick of the way corporate America is treating its employees. But that's just me.

Cruiser:

Yo, Blondie --

You think "Ameriican Chopper," a Discovery Channel mainstay, is ripe for joining the pablum Disney serves up? Family friendly? Maybe the Manson family!

The market is speaking, and your Zorro is paying attention. Too bad about the employee victims, of course. Price of capitalism. How about socialism, where everyone is a victim? Ask the Cubans.

But I digress. You shouldn't.

Keep the fat cats on their toes, Blondie.

Gonzoguy:

Dear Ms. Paskowski:

What a pleasure to find your column, lamenting the latest victim of a pernicious trend in TV and cable: the death of quality in the face of lowest-common-denominator programming. Sadly, Mr. Zaslav probably has little choice. He has a fiduciary duty to stockholders, after all.

But who has an intellectual/educational fiduciary duty to fans of the Discovery Channel and satisfied customers of those Discovery Stores you too quicky disparage? I'm not afraid to ackowledge that I like both: good TV on the Discovery Channel and far more fun in the stores than I've ever found in Wal-Mart, Tiffany, or just about all places in between.

Just as American voters have gotten the government they deserve, so too do TV viewers. Enterprising TV cannot survive, sadly, unless it's an inspired stroke of genius like an American Idol. Otherwise, to survive you need to cater to the mob with the same old tired formulas. Discovery tried otherwise, and succumbed

Sorry about the rant, but it's great to find a blog intelligent enough to rant about!

Thanks,

GonzoGuy

Marianne Paskowski:

Cruiser,
Maybe Disney is not the best buyer for Discovery if it is indeed for sale. But everything is as consolidation marches on. You're intimating that History would be a better buyer, given its penchant for the type of programming you describe. But History is owned by Disney, Hearst and NBCU, which would probably be a complicated deal.

I still see Malone's fingerprints all over what is happening at Discovery.

Marianne

Marianne Paskowski:

GonzoGuy,

Blame it on the Bossa Nova or whatever, but Discovery got fat. And so what is wrong with fat, if it gives you the luxury of producing great programmming. Zorro is acting fast, way too fast, and thinking more about John Malone and shareholders than viewers and advertisers.

I thank you for your intelligent response, I do dislike the Discovery stores, BTW. I bought a dog training enhancement kit, that lasted 5 minutes in the mouth of a chewing machine, a teething yellow lab.

Best,
Marianne

West Coast Dave:

WELCOME BACK to the class known as taxpayers!!!

Shall be a good thing to watch your blogs

adios

DWS

Marianne Paskowski:

Dave,
Thanks, nice to have a place to let off a little steam.
Marianne

Molly:

I'm not sure that Zorro is setting Discovery up for sale... I just keep thinking of that nice guy I saw on 5th Ave. last year. I didn't see the corporate slasher in him that day. That said, somebody probably had to do this, at least as long as the stockholders are the ones to keep happy. I tend to agree with another commenteron this blog... that maybe he's just running the company in a way that will increase earnings and allow it to take advantage of new distribution platforms. I just hope that Discovery will be able to continue doing amazing programming like "Planet Earth."

Jim Forkan:

Hi Marianne,
Welcome back. We missed you and your blog...
I always thought Discovery was one of the most stable media companies and its people seemed to be among the happiest. With many lately on edge, that's probably no longer the case.
I'd agree that Disney's family focus would make for good linkage with Discovery. Meanwhile, I'm not sure the selling of Travel Channel was a good move. I always thought it meshed with the overall "explore your world" Discovery theme line.
The sale of the Discovery Stores makes me wonder whatever happened to the networks' infatuation with the S word. For a long time, synergy was the big buzz word. I don't know much about what the stores sell, beyond the videos and toys, which I thought were above-average.
Write on!
Jim

Marianne Paskowski:

Hi Molly,
I'm not sure either, but it is a distinct possibility, given the owenership. The wild card as always is Liberty Media Holding's John Malone. His rep is to hire henchmen like Leo Hindery, who cleaned up, severed limbs to sell TCI t to AT&T. And now the sign of the "Z," aka David Zaslav, at Discovery.

I do agree tat Discovery was/is bloated with lots of flotsom form the Judith McHale era. So now the chickens are coming home to roost, Judith's interests are in the Beltway, and there was a very good reason her contract was not renewed. Having said that, she kept the mess together while John Hendricks, founder, was off the reservation, building soccer arenas.

Plenty of finger pointing here, but I point mine at John Malone, who owns 50 percent of the company. Oh, and by the way, remember he hates to pay taxes. So do I, but I do it, and don't get away with his BS tactics.

Marianne

Marianne Paskowski:

Hi Jim,
Great to be back. I always thought Discovery, Disney, and even ESPN made a huge mistake venturing into retail. Totally different business, lots of mortar and bricks and inventory, and not CONTENT. All of them are better off extending their brands online. Even Scripps, with its Home and Garden net, and food channel, could not face the warehousing problems that Discovery has had for 10 years. So I give Z credit their for doing what should have been done long ago.

Regards to you and your family,
Marianne

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