Warner Bros Discovery Town Hall: CEO David Zaslav Tells Oprah Winfrey How The Merger Was Born, Faces the Future of CNN, Looming Staff Cutbacks

Warner Bros. Discovery CEO David Zaslav and other executives met with staff from Burbank City Hall in the Warner Lot. The meeting was, above all, a review of many key messages from a nearly year-old merger to a historic merger, though the CEO briefly touched on the upcoming layoff, highlighting CNN and how the merger is. occurred.

The nearly hour-long event was the first full meeting since the $ 43 billion merger concluded last Friday. (Except a few hundred people, thousands more were seen live.)

According to a preliminary recording of the event provided to Deadline, Zaslav declared it a “new day, a bright and glorious day”. After a short speech, she introduced Oprah Winfrey, who interviewed Zaslav on stage and led him into a one-hour discussion, mostly on high-level remarks about the overall portfolio. Asked how the deal came about from initial negotiations in February last year, Zaslav said AT&T CEO John Stanke wanted to quickly transfer the company’s entertainment assets. Additionally, WarnerMedia and Discovery were looking for scalability in streaming to better compete with Netflix and Disney.

Reflecting on the results of more than a year of merging companies, Zaslav said: “It’s like our rendezvous with destiny. This is art. We have resources, we have the opportunity to be the largest media company. I can’t explain why it happened. This transaction is not like other wonders four times bigger than us. We manage the whole company together. We could have created a creative team, the best of both companies, but it happened and now is our time. As you know, it starts this week. And all this is in front of our eyes “.

Winfrey has been on stage chatting with Zaslav since they’ve been working together since 2008. The Oprah Winfrey Network, also known as OWN, started out as a joint venture but is now almost wholly owned by Warner Bros. Discovery. By the end of 2020, Winfrey had sold nearly her entire stake in Discovery through her company Harpo for $ 36 million. The move gave Discovery nearly 95% (versus 73%) of the organization, but Winfrey has also signed on to remain OWN’s primary collaborator and creative supervisor for years to come.

Winfrey missed some questions Zaslav sent from employees. At one point he was asked how he intended to merge the companies, which would likely lead to the layoff of hundreds or perhaps thousands of employees. He agreed with Winfrey that “culture is everything” and said that at WarnerMedia, formerly Time Warner, longstanding cultural issues remain relevant.

Zaslav noted that Time Warner executives like Jeff Beukes and Gerald Levine founded the company “basically it was ‘We compete for our business'”. “There is nothing wrong with this actually being a very good strategy. And you know, they had all these different businesses and you know, don’t do any good to other businesses, run your own business, make as much money as you can, just like you compete with others against them. “

However, when employees come together, “now we have to come together as one culture, a culture that starts with people who feel protected, people who appreciate who they are.” In the absence of this, she continued: “You can’t be creative”. After so much structure, leadership and setup (at least by Warner), I think we have to be very clear, do you know what victory is? Zaslav said.

Except for Winfrey (who noted that Warner Bros. made her film debut, Purple), figures from Warner Bros. history were in the town hall auditorium. One was Mark Ross, the son of Warner Communications chief Steve Ross. (Zaslav noted that he was hired by Ross’s attorney early in his career.) The second was Cass Warner, grandson of Harry Warner, one of the original Warner Bros., who founded the firm nearly a century ago. Zaslav also mentioned a meeting with CNN founder Ted Turner in Washington earlier this week.

Zaslav called Turner the “hero” of CNN’s creation and said he recently had long conversations with Chris Licht, who moved in after Jeff Zucker’s departure earlier this year. Zaslav said news gathering rather than entertainment would be CNN’s goal given its large global presence. The CEO said installing multilingual channels is a potential way to enhance the company’s unique presence, as demonstrated during the Russian invasion of Ukraine.

“News channels here and around the world have become advocacy networks,” said Zaslav. “There isn’t much difference between some news networks and a food chain.”

In addition to stopping CNN, Zaslav held a series of small meetings with workers in many cities. Since being offered the deal for the first time last May, he and Discovery’s superiors have sought to deepen their understanding of Warner’s business, even though they faced some regulatory restrictions prior to the official closure.

WarnerMedia Spinoff, a combination of AT&T and Discovery, has created one of the largest companies in the media industry. Although Discovery only controls 29% of the new unit, it has operational control.

Many eyes are on Zaslav, not only within the company but also across the industry, as he plans to integrate two large companies with combined annual sales of over $ 50 billion. He promised Wall Street $ 3 billion in savings from the deal, which means a significant number of layoffs. Aside from a series of high-profile departures last week, the former CEO of WarnerMedia and many of his direct associates have left the ranks, the extent and nature of the cuts remain unclear.

Streaming, of course, will be Warner Bros. Discovery’s strategic focus. The company intends to make HBO Max the primary ship to attract consumers. Discovery +, a subscription service launched in January 2021, has grown steadily but not dramatically and will become HBO Max in the coming months, if not years. (Many technological and logistical obstacles will prevent you from generating an instant process.)