David Zaslav, the CEO of Warner Bros. Discovery, has ditched the company’s corporate headquarters in New York — instead running the media conglomerate from its iconic movie studio lot in Hollywood, according to a report.
Zaslav’s decision to run the film-and-TV colossus from a second-floor office on the Warner Bros. lot in Burbank, Calif. signals he is betting that the movie studio’s upcoming releases featuring comic book franchises such as Batman and Superman will help the firm get out from a mountain of debt.
Since taking over as CEO of the newly merged entity — whose properties also include CNN, HBO and DC Comics in addition to Discovery, HGTV and other cable networks –Zaslav has been wooing Hollywood talent who were put off by the previous management’s decision to have theatrical releases simultaneously be available through streaming, according to the Financial Times.
Zaslav, 63, has sought to make amends by pledging full cinematic runs before moving films to streaming. He is also looking to boost morale among company employees who were demoralized by his cost-cutting spree in the first year of his helm, according to FT.
“He wooed Hollywood and people really loved that,” a former Warner executive told FT.
“And then what does he do? He comes in and sets up in the Warner studio lot, which no public company CEO had ever occupied, and starts sitting in on creative meetings, which raised a lot of eyebrows.”
Zaslav works in close proximity to his new Warner studio chiefs, Mike De Luca and Pam Abdy, who are reportedly thinking of reviving money-making sequels such as “Harry Potter,” “Lord of the Rings,” and “Oceans 11,” according to FT.
“It makes sense to me that [Zaslav] would place himself physically where he can have lots of interaction [from an office] right across the hall from Mike and Pam,” a Warner veteran told FT. “That kind of proximity facilitates his learning curve . . . David has not read a lot of screenplays in his life.”
Warner Bros. is scheduled to release 15 films this year after producing just six in the theaters last year.
Executives at the company are hoping for big returns from highly anticipated features such as “Barbie,” “Dune 2,” and “The Flash.” DC Studios is also reportedly preparing for new “Batman” and “Superman” releases sometime before 2025, FT is reporting.
Warner Bros. Discovery is also banking on the success of its strategy that will combine streaming services HBO Max and Discovery Plus into one unit, which will relaunch in the spring.
There’s a lot at stake for Warner Bros. Discovery, which faces a debt burden of more than $50 billion left over from the merger between Discovery and WarnerMedia, the former property of AT&T.
Zaslav’s cost-cutting has been felt across company units, including struggling cable news outfit CNN, which laid off hundreds of employees.
One of Zaslav’s most dramatic moves in the early weeks of his reign was to do away with CNN+, the fledgling streaming service that was shut down just a month after its highly touted launch.
Another headline-grabbing decision by Zaslav was to cancel the $90 million film “Batgirl” and write it off as a loss for tax purposes.
The movie was set to feature the first-ever Latina superhero in the DC comics franchise.
Democratic lawmakers on Capitol Hill sent a letter to the Justice Department over the weekend demanding that federal regulators review the Warner Bros. Discovery merger, which they claim is to blame for “hollowing out an iconic American studio.”
In a letter to Attorney General Merrick Garland, the DOJ was asked “to investigate the state of competition in affected labor and consumer markets following the consummation of this merger, which appears to have enabled Warner Bros. Discovery to adopt potentially anticompetitive practices.”
The cost-cutting spree undertaken by Zaslav has stoked speculation that he is laying the groundwork for an eventual sale of the company to another media giant, Comcast, which owns NBCUniversal.
But the CEO has pushed back on the speculation surrounding an eventual Comcast deal, telling staffers in September: “We are not for sale.”
Zaslav’s denials failed to dampen the speculation.
“One thing you can’t get around is the question of what the real game is here,” a Hollywood executive told FT.
“The issue of Comcast buying Warner comes up [with employees],” the executive said. “I don’t hear anybody [at the company] saying we’re here for the long term.”
Zaslav is under pressure to boost the company’s sagging stock, which is down nearly 40% since the merger was consummated in April of last year.
The share price, which hit a peak of $26 per share in April of last year, is down to around $15.06 as of Monday around noon.
Zaslav received a total compensation package last year of $276 million, but around three-quarters of it — $202 million — is tied up in stock options.
The only way Zaslav can realize those options is if the share price reaches a range of between $35.65 and $43.33.
The Post has sought comment from Warner Bros. Discovery.
[Written in collaboration with other media outlets with information from the following sources]
