Before NBCU considered spinning off cable networks, many of them were shut down

Unlike its competitors, NBCUniversal long ago developed a healthy fear of zombies.

Not the shambling, undead kind that lurks around trying to eat brains, but rather the media variety: “undead” cable channels that long ago abandoned all hopes of cultivating a 24/7 audience in favor of just one a few hours of original programming coupled with seemingly endless repeats of TV favorites like “Ridiculousness” (MTV); “Fear Factor” (HLN); or “Seinfeld” (Comedy Central).

Paramount Global and Warner Bros. Discovery, two of the larger owners of these cable network spectres, didn't have much to show for keeping them going. In fact, Warner announced a massive $9.1 billion writedown of its TV assets in August, citing business headwinds and the expected loss of its lucrative agreement with the NBA to broadcast games on its cable networks. Paramount Global followed suit and announced a $5.98 billion impairment charge as it prepared to be acquired by Skydance Media.

NBCU hasn't announced a write-down yet, and one reason is that the company has been shutting down underperforming cable networks for years without any sentimental attachment to it. “There are just too many channels,” Steve Burke, NBCU’s former CEO, said in 2016 after the company killed off Style and G4. Also gone: Esquire, Cloo and Chiller. In 2021, NBCU caused a stir when it announced plans to close NBCSN – a sports network! The theory: Sports broadcasts would strengthen the NBC broadcast network, the US cable channel and the streaming service Peacock (Narrator: “They have that.”)

Now Comcast, NBCU's parent company, will consider a possible spinoff of its cable portfolio, the company announced Thursday during a call with investors. The idea, said Comcast President Mike Cavanagh, is to analyze the potential impact of such a transaction before making a decision. “Maybe there are some smart things to do and that’s what we want to explore,” he said. The news almost immediately sparked speculation that Warner Bros. Discovery or Skydance were looking to acquire such assets, although Cavanagh stressed the intention to hand the new company over to shareholders if a decision was made.

“Investors have wanted exactly this, or at least something similar, for years,” said Craig Moffett, an analyst at MoffettNathanson. A deal like this would decouple Peacock and NBCU's sports properties from the cable network's declining economics.

It's no secret that standalone cable networks have become complex but toxic assets in the modern media offering. They continue to generate millions in advertising and distribution revenue, but need millions in content spending to maintain their ratings, just as many of their viewers are moving to streaming services. Disney's FX, for example, was long known for offering unique dramas and offbeat series, releasing one episode per week at certain times of the year, often tailored to the needs of its producers. These days, most people think that “The Bear,” a current FX favorite, has more to do with Hulu, parent company Walt Disney Co.'s streaming service.

NBCU's current cable properties aren't all running at full speed. The Universal Kids network never reached the heights the company had planned when it acquired DreamWorks Animation for $3.89 billion. In fact, it might have been better for NBCU to keep the outlet under its previous name, Sprout, since it was designed to appeal to preschoolers and their parents. Oxygen, once a network backed by Geraldine Laybourne and Oprah Winfrey and created specifically to appeal to female viewers, is more or less a premium true crime channel where rivals have a stronger place.

But there are still some good companies. MSNBC and CNBC have die-hard audiences, and while the US is no longer known as the home of Blue Sky dramas like Burn Notice or White Collar, it always beckons with sporting events and the return of White Collar still large crowds of spectators. WWE SmackDown.” Bravo has built a die-hard fan club of people who want to experience every detail of every edition of “Real Housewives” that's on the air.

Comcast may be wondering whether it can avoid some of the challenges Disney faced. Charter Communications gained attention for its recent carriage negotiations with the company, in which Disney agreed to make Disney+ and ESPN+ available to some of its distribution partner's subscribers, while giving Charter the option to abandon cable channels such as Freeform, Disney Junior and Disney XD.

Spinning off the cable would raise some pretty thorny issues. Could NBCU's news operations still thrive if MSNBC and CNBC were spun off from NBC News' news apparatus? Don't cable revenues provide valuable revenue for actual reporting? And have cable and satellite operators reached any agreements that guarantee that a certain number of sports programs will continue to be shown in the United States?

Cable has reduced the value of Paramount and Warner. NBCUniversal could still be able to reap new benefits from the medium if executives use their hand correctly. Comcast and NBCUniversal have the luxury of scrutinizing such things because, unlike their competitors, they didn't just blow the whistle.