Marketers are hoping for a quiet week to recover from the hangover and heat of Cannes Lions before the 4th of July weekend. Instead, they are looking for information to better understand how the Comcast and NBCUniversal split could affect them.
In short, Comcast CEO Brian Roberts announced Monday (June 29) that the two businesses, which were combined after a 2009 deal, would split as part of a tax-free spinoff. Comcast launched its cable TV business Versant in January.
Roberts said the newly spun-off NBCU, which will include NBC, several cable networks, Telemundo, Peacock and Sky, will serve as “a unique, independent, focused company that will be home to some of the industry’s most valuable brands and assets across theme parks, film, television, streaming, sports and news.” Mike Cavanagh, Comcast’s current co-chief executive, will become CEO at NBCU.
The spinning plan was a surprise from Roberts, but has been well received by the market; Comcast’s stock price has risen 6.5% since Monday, at the time of writing. What impact this will have on advertisers is less clear.
Three media buyers told Digiday that they had no information from contacts at NBCU or Comcast regarding how the split might affect their clients, or how elements of the Comcast/NBCU ad stack would be split – although ad servers and DSP providers Freewheel and Universal Ads are expected to remain with Comcast.
Dan Larkman, CEO of performance advertising business Keynes, mentioned a number of “unknown opportunities” that could change the landscape of agencies working with NBCU networks or Freewheel itself.
“Could they offer the same incentives? Would Freewheel still have access to the same type of inventory that NBCU has? Would that change, allowing NBCU to use Magnite or Trade Desk?” Larkman asked.
While there are no details, agency experts told Digiday that the move may have an impact on CPMs once the issue is resolved.
“We’re trying to figure out what this means from a negotiation standpoint, especially as it relates to spread pricing.” said Kaitlyn McInnis, executive director, investments at CrossMedia.
Some expect NBCU will try to raise floor prices on its streaming and linear TV inventory, especially as it seeks to fund expensive sports rights deals amid competition from streaming platforms.
“Once the spinoff is complete (perhaps 12 months), there will be pressure for NBCUniversal to grow advertising and subscription revenues without Comcast’s support,” said Luke Moore, vice president and managing director, media partners at full-service agency FUSE Create, via email. “This will likely push available inventory towards higher CPM media buys, such as addressable or data-heavy media products and reduce focus on traditional linear TV.”
Other media agency executives are skeptical that the split can restore NBCU’s influence over advertisers.
“They can try whatever they want, they’re still in a competitive market,” said Lisa Herdman, head of enterprise integration at RPA.
With the TV market getting stronger this year, few buyers expected the split to disrupt negotiations. “I really don’t see it having an impact this year and I don’t see it having an impact next year,” said Horizon Media’s evp and chief investment officer, Samantha Rose.
This may change in 2027, with unbound NBCU under pressure to establish a solid foothold. “Next year could be a different story, as it will be the first year they hit the ground running as a stand-alone entity,” said Abby McNally, group director, connection strategy at Collective Measures.
“NBC has historically been a place where it’s been difficult to push for better pricing. With this separation, I hope they will be more receptive to conversations with advertisers. I see it as a professional thing,” McInnis said.
Advertisers who already have long-term deals, such as presenting sponsor slots, are also unlikely to see changes, Keynes’ Larkman added. “Companies like NBC [will] protect advertisers at all costs,” he said.
However, buyers who look further will notice a problem. NBCU without a Comcast partner could become an acquisition target for streamers with deep pockets (Netflix, for example, might consider making another big media acquisition).
One media buyer, who did not want to be named, recounted their “disastrous” scenario, in which NBCU’s Olympic broadcasting rights were compromised by a spinoff or merger with a larger entity.
“If they reduce it [coverage]which will ultimately impact our plans or the client’s reasons for joining [for Olympic media buyers]said the buyer.
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