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In 1988, Ted Turner had a vision: CNN should merge with Discovery Channel.
It was still early days for cable television (Discovery debuted an experiment called “Shark Week” that year), but the outspoken CNN founder, someone with an eye for deals, floated the consolidation. “They just belong together,” Turner told Discovery founder John Hendricks at the time, inviting him to CNN’s Atlanta headquarters for a tour.
Discovery’s board convened in the wood-paneled board room of the boutique investment firm Allen & Company, under the watchful eye of the Norman Rockwell paintings that adorned its walls. “It was clear to all of us on the board of directors that the Discovery Channel would one day be worth $500 million, $1 billion or more. So why sell out now when the value might be only $150 million?” Hendricks wrote in his 2013 memoir, A Curious Discovery. “Not surprisingly, no one on my side of the table even wanted to talk about a merger. We were willing to discuss joint productions between CNN and Discovery, but any merger talks would be unproductive.”
Thirty-three years later, and Ted Turner’s vision is now one step closer to reality, with Discovery Channel owner Discovery Inc. and CNN parent company WarnerMedia having unveiled a $100 billion-plus merger plan on May 17.
The new deal, however, wasn’t negotiated in a bank’s corporate board room, but rather in Discovery CEO David Zaslav’s Greenwich Village brownstone, and over text messages punctuated by golf emojis. Inside CNN, the merger news was greeted by “sighs of relief,” one source says. “It sounds like there will be real investment here.”
CNN finds itself at a crossroads, with president Jeff Zucker only committed to stay for a few more months, and with a swirl of rumors about a potential sale or spinoff from WarnerMedia (a source confirms that AT&T was approached last year about spinning off CNN).
Zaslav put those rumors to rest during a press conference with reporters on May 17, in which he called CNN “the beacon” of cable television and committed to growing its reach.
“We are committed to CNN having the greatest editorial integrity and success globally,” Zaslav said, noting that Discovery already owns a number of news organizations in Europe. “Now our mission is to lean into news, put [the Discovery international assets] together with CNN, and be the world leader in news.”
While multiple sources say that AT&T never interfered with CNN’s news coverage, there was a feeling that the Dallas-based, conservative, buttoned-up telecom executives viewed the cable news channel as something of a hassle … even as they appreciated its robust cashflow.
That is a contrast to Zaslav, who enthusiastically told reporters Monday he had “been glued to CNN for months,” and was looking forward to helping it develop a direct-to-consumer business.
And Zaslav’s relationship to CNN is deeper than simply being a viewer. He is close friends with Zucker, and the merger announcement raised hopes inside the channel that he could convince Zucker to stick around past this year.
In addition, Zaslav’s daughter is a producer for the cable news channel, and he has been known to send emails to talent and guests with comments about segments or interviews.
While he isn’t a journalist by trade, Zaslav is not shy about his love for news, touting the role he played in launching CNBC and later MSNBC.
“Those businesses brought a tremendous amount of value to NBC when I was there,” he says. “The currency, of being the thing that people turn to in the morning… it is even more important in a world where there is so much content out there and it is being commoditized in different ways.”
If CNN were at risk of being commoditized before, there is now a feeling inside the company that the brand is likely to get bigger, rather than shrink. Whereas there had been concern that CNN would have to fight as a scrappy independent company in a spin-off, or absorbed into another news organization in a sale, those fears have faded away.
“This is probably the best outcome for us,” a CNN source said.
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