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Zucker Now NBCU’s Heir Apparent

Dec 19, 2005  •  Post A Comment

So much for the Hollywood gossip.

After months of speculation about his standing and future at NBC Universal, Jeff Zucker received a promotion last week that essentially made him the heir apparent to NBCU Chairman Bob Wright-and dispelled industry talk that Mr. Zucker’s days at the network are numbered.

In reorganizing the executive suite, Mr. Wright now has fewer direct reports, with two people who previously answered directly to him-NBCU Television Networks Group President Randy Falco and NBCU Sports and Olympics Chairman Dick Ebersol-now reporting to Mr. Zucker, who becomes CEO of the newly created NBCU Television Group. Mr. Ebersol will retain his current title. Mr. Falco is now president and chief operating officer of NBCU Television Group.

The executive changes also bring a former NBC executive and current star at NBCU parent General Electric back into the fold. Beth Comstock, who left NBC in 1998 as senior VP of communications for a series of senior-level positions at GE, returns to the media company as president of NBCU Digital Media and Market Development, reporting directly to Mr. Wright.

Ms. Comstock, whose working relationship with Mr. Zucker dates to when Mr. Zucker was executive producer of “Today” and she was a VP of corporate communications at NBC News, most recently served as the conglomerate’s chief marketing officer.

In her new role Ms. Comstock will have responsibility for NBCU’s digital media efforts, which have become a top priority for both Mr. Wright and GE Chairman and CEO Jeffrey Immelt, who last week told Wall Street analysts that NBCU’s growth potential is rooted in opportunities to leverage digital technology.

“Digital gives us more ways to sell the content,” Mr. Immelt said.

Her first order of business will be to oversee the transition associated with the departure of Deborah Reif, NBCU president of digital media, who will leave the media company to take a job at GE. Ms. Comstock said Ms. Reif will be replaced.

Ms. Comstock will also oversee television research, strategic marketing and corporate communications, and arrives at a time when the broadcast network has gotten beat up by weak prime-time ratings and has had to endure controversy surrounding the future of “Today” host Katie Couric at the network.

Although the elevation of Mr. Zucker amid the network’s prime-time woes is generating a lot of buzz, some observers saw the promotion of Mr. Zucker as a natural move.

Harold Vogel, CEO of Vogel Capital Management, said that given Mr. Zucker’s profile, and particularly his “visibility with the press and Wall Street analyst community with all sorts of events, both good and bad, Jeff had the most visibility [of the executives reporting to Mr. Wright], which would have suggested he was being groomed for a higher post.”

Even Mr. Wright appeared to confirm such a view. Asked whether the reorganization sets the stage for Mr. Zucker to replace a retiring Mr. Wright, the chairman said with a hearty laugh, “Absolutely.”

He later said, “Jeff has a lot of responsibility in some key areas. I hope he does the best possible job in this leadership position for a long time to come.”

However, one former top NBC executive speculated the moves might not imply quite so strongly that Mr. Zucker is a shoo-in for Mr. Wright’s job. These moves represent a chance for Mr. Zucker to redeem himself in the face of NBC’s recent prime-time struggles, but while they also appear to eliminate Mr. Falco as a Wright successor, Ms. Comstock could one day be considered a contender for the top spot, the former NBC exec said.

An NBCU insider stressed that Mr. Wright has no plans to retire anytime soon and that last week’s realignment was more about creating an integrated team to transition the company into a digital media player.

Ms. Comstock is a confidante of Mr. Immelt, to whom Mr. Wright reports, and Mr. Immelt endured a competitive process himself to succeed Jack Welch, the insider said. Digital is likely to be the fastest-growing area at NBC and that will give Ms. Comstock an important platform, with the backing of the chairman of GE.

Yet even against that backdrop, Mr. Wright made clear that last week’s reorganization is more about positioning the company to take advantage of opportunities in the digital media space than about creating a succession plan.

“This is about trying to get as much heft and weight on all of our television products: programming, distribution, sales and marketing,” Mr. Wright said during a conference call to discuss the changes. “All the commercial aspects [of the network] are lined up with the content, and this gives us a chance to feel more comfortable about where we are.”

And though Ms. Comstock will be responsible for a piece of the business that both Mr. Wright and Mr. Immelt see as critical, people familiar with Mr. Zucker and Ms. Comstock say it’s unlikely that even with both of them reporting to Mr. Wright some sort of rivalry will surface for the chairman’s position. Insiders noted that Ms. Comstock and Mr. Zucker worked closely together in the 1990s and that their interests are aligned with each other’s, reducing the chances of the sort of battle that was shaping up at Viacom between co-COOs Leslie Moonves and Tom Freston for Chairman Sumner Redstone’s job.

Mr. Wright said the new structure should also help position the network, which is now in fourth place in the 18 to 49 demo, for a comeback.

“When you lose momentum, it’s hard to regain it back,” he said. “There is a huge effort to try to get that back. … This change will accelerate the pace of that recovery” by ensuring that all the units of the network report to the same executive. Mr. Wright noted that this strategy is already in place at NBCU’s cable operations, but had been somewhat fragmented at the broadcast network. “At this time in the development of the business, this is the right thing to do,” he said.

For his part, Mr. Zucker stressed that his day-to-day job won’t change much under the new hierarchy, adding that operations that are running smoothly-in particular the sports division-won’t suffer any meddling by him.

“I don’t think I envision throwing myself into places that are working incredibly well,” he said. “I think the key thing for me is to be able to bring the entire organization together with Randy as my partner.”

Mr. Falco, who in his new role will add the oversight of NBCU’s owned-and-operated television stations in addition to other responsibilities of business development, Spanish-language network Telemundo and worldwide distribution, echoed those sentiments: “My day-to-day responsibilities won’t change too terribly,” he said. “This is about a partnership between Jeff and I. We are finally putting together all the assets of NBCU on the TV side and aligning them in a more complicated world.”

The executives all said that changing technologies, including the recent wave of deals by media companies to distribute onto alternative platforms, necessitated the change. They pointed out that two recent deals struck by NBCU-the video-on-demand pact with DirecTV and a video download deal with Apple Computer’s iTunes Music Store-were negotiated by two executives within the company. Under the new plan those two executives report to Mr. Falco.

Jon Lafayette contributed to this report.