Warner Bros. Discovery may have sold (or more accurately given away) its stake in The CW two years ago, but the company is trying to bring back one of the broadcast network’s hallmarks: A tonnage of output for the WB TV studio.
At a Bank of America conference Wednesday, WBD CFO Gunnar Weidenfels said that when Channing Dungey adds oversight of the company’s TV networks at the end of this year, she will look for opportunities to create synergies between the studio and the channels.
“Channing Dungey is now going to get a little closer to the network business when Kathleen [Finch] retires,” Weidenfels said. “I think that’s going to create some great cross-pollination between the two businesses. One of the great advantages of operating The CW in the past was that it just drove a lot of volume, more at bats for the TV production business. And we’re looking into what we can recreate. Kathleen has already announced some scripted shows returning to TNT — very different from what was done in the past, again, with an eye towards actual value creation — but maybe there’s more.”
Indeed, Weidenfels framed content as one of the big “opportunities” for the company, even as the cable TV business continues to disintegrate.
“The most important point is that we are facing challenges to the distribution ecosystem, not the content ecosystem, people are consuming more than ever, we happen to make some of the greatest content in the world, and the way this content is being consumed is changing but we have a tremendous opportunity,” he said. “Yes, we have made a lot of tough decisions, there was a lot of focus on efficiency and cost savings, but I view this more as professionalizing the capital allocation of the company. Content is an area front and center where we are increasing our spend beyond just the strike impact of last year.”
Weidenfels characterized his job as “making sure that we are stingy in the areas we should be, but generously funding the growth opportunities.”
Another growth area is gaming, which categorized as a “strategic asset” for the company. He noted that the gaming division is struggling, due to a big miss with a Suicide Squad game, compared to the huge win last year with Hogwarts Legacy. So it makes sense that the company is already thinking about a sequel to the game set in the Harry Potter universe.
“It is, just like the film business, a hit-driven business,” he said. “Obviously a successor to Hogwarts Legacy is one of the biggest priorities in a couple years down the road.”
And film is another area of investment, with DC Studios a key piece of that. The WBD CFO said that James Gunn and Peter Safran are “revitalizing” the brand.
“What that means is not only an integrated story arc over a 10-year canon for DC, but also a lot more thought going into the specific individual stories, which stories lend themselves for interactive implementation, which stories, which characters are so core for us that we’re never going to allow them to be on any other platforms, which characters might create great stories but we might be willing to produce them for third party platforms,” he said.
As for the rumblings that WBD could explore strategic options (a strategy outlined by Bank of America’s own Jessica Reif Ehrlich), Weidenfels suggested that the company has explored them, but that it is about to hit its stride.
“The board, and, you know, secondarily, the management team have a fiduciary duty to evaluate these opportunities, and you know, we’re going to be rational in our decision making,” he said. “But that said, I think we are at the point where a lot of the investments we’ve made with a lot of hard work across every segment of this company over the past two years that have put us in a position to now to get some of the fruits of that labor.”