NBCUniversal Doesn't Need to 'Bulk Up' Amid Industry Deal Talk, CEO Says
After Fox's recent Time Warner bid, Steve Burke points to successful upfront ad sales, while Comcast CEO Brian Roberts says NBCUniversal's performance "positions us well in the content business."
NBCUniversal CEO Steve Burke said Tuesday that he feels good about the size of the Comcast-owned entertainment portfolio despite industry and Wall Street talk about possible Hollywood deals after the recent 21st Century Fox bid for Time Warner.
"We certainly don't think we need to bulk up in content," Burke told analysts on an earnings conference call when asked about his need for added size. "We sold all of our broadcast and cable assets together in the upfront. And I think that was a major reason why we had such a successful upfront relative to the rest of the industry."
He said that the company was up 10 percent in the upfront, with the industry down slightly, say roughly 5 percent. "On a base of $5.3 billion that is a $750 million swing" for NBCUniversal that "goes toward closing the monetization gap" between NBC and other broadcast networks.
He added: "We think we are about half-way there" in terms of closing the monetization gap.
Comcast chairman and CEO Brian Roberts on the earnings conference call Tuesday said that NBCUniversal "had a great first half," which has made management "really happy." In a possible reference to the recent news of Fox's rejected $80 billion bid for Time Warner and talk of further industry consolidation, Roberts added that NBCUniversal's performance "strategically and financially positions us well in the content business."
It also shows that as the company goes through the regulatory review process for its planned acquisition of Time Warner Cable, it has remained focused on its current business, Roberts said.
"It's a very powerful combination," he said about the planned combination of satellite TV firm DirecTV and telecom giant AT&T, lauding both firms for having affected Comcast's cable subscriber momentum in recent years. Roberts added "our company is really well positioned" and hopeful it can win approval of its TW Cable deal.
Asked about deal appetite in terms of cable systems later on the call, Comcast CFO Michael Angelakis said "we have quite a full plate," and the company is excited about the TW Cable transaction.
Highlighting that the NBC broadcast network was No. 1 in the latest season in the key 18-49 year-old demographic, Roberts said the recent upfront advertising sales season allowed NBC to see a gain of about 8 percent in ad rates.
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In the film business, NBCUniversal had a "relatively quiet theatrical quarter," but it continues "building toward a strong slate in 2015 and beyond," Roberts said.
Burke said that the company has "a great slate planned for 2015," which should see more normalized film business trends after a 2014 with fewer high-profile releases and spending on coming films.
Saying that "sports rights are so valuable," Roberts also lauded a recent deal that clinched Olympics rights through 2032.
He also lauded the recent expansion of the Harry Potter experience at the Universal Orlando Resort. "It was amazing," Roberts said, predicting it would set up NBCUniversal's theme parks unit for further growth.
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