Versant’s IPO Marks a Turning Point for Business Television
Last week Comcast named its planned NBCUniversal cable assets spinoff Versant. Cognito and our clients generally care most about CNBC, but the channels being spun off in the planned IPO in coming months also include: USA, MSNBC, Oxygen, E!, SYFY and the Golf Channel. Versant will also house the digital assets Fandango, Rotten Tomatoes, GolfNow, GolfPass and SportsEngine. The rest of Comcast’s NBCUniversal portfolio, including NBC, Peacock, Universal Studios, the theme parks and Bravo, will remain with Comcast.
The plan is to IPO Versant before the end of 2025. The assets held by the new company generated about $7bn in revenue last year. What’s not public is what the revenues of each channel were (much less profitability), but we might assume that the bigger properties include CNBC, MSNBC, USA, E!, and – perhaps – the Golf Channel.
CEO Mark Lazarus has been bold in saying that Versant will seek growth by diversifying away from cable, including acquisitions possibly outside pure media, citing Golf Channel’s acquisition of GolfNow, a tee-time reservation company. He also suggested that a channel like CNBC might perhaps acquire personal finance or fintech platforms, and MSNBC might buy podcasts that are Dem-friendly. Noting that Versant assets are already 20% digital, Lazarus summed up; “We are not going to be purely a collection of linear and digital media assets.”
Versant IPO Outlook: Challenges for MSNBC, CNBC, and Business Television
The big questions surely are: how strong an investor story can be told about essentially a cable channels/linear TV business, and what kind of cost measures – especially at MSNBC and CNBC – will be needed to make Versant as appealing as possible to investors?
It’s fair to say there is considerable scepticism by media commentators about Comcast’s strategy here, and speculation that ultimately some of these legacy assets will be sold off individually, either pre or post IPO. The pivot from linear to (profitable) digital is exactly the challenge that CNN and others also attempting to navigate. Dylan Byers at Puck commented that while CNBC has room still to maximize its digital business, it was harder to see such a route for MSNBC.
The other question Versant will bring into focus is whether America (and beyond) can support three business TV channels. Neither of the other business two channels – Bloomberg and Fox Business – have much in the way of financial transparency. I assume that selling Versant’s IPO story will necessitate in the prospectus much more margin information around CNBC, MSNBC and the other main channels.
The Strategic Rationale Behind Comcast’s Spin-Off
Versant has ruled out a few directions – it won’t buy further cable channels, won’t buy TV stations, and it won’t develop a streaming service. The company has been quick to say that the name Versant is not supposed to be consumer-facing, more an agile “house of brands”. Comcast got ideas from marketing teams in each of the Versant brands, along with work from three marketing agencies (!) and narrowed down over 1,000 possible names to 43 that lawyers reviewed. The company has said that Versant implies corporate flexibility and has also suggested that Versant in part references a region of land sloping in one general direction.
Versant will be fascinating, not least with serious rumours last week that Warner Brothers Discovery also may split itself in two to detach the higher growth businesses from the struggling cable assets. This week in New York is the most important week of the annual “Upfronts” process, when advertisers get the chance to buy space in future seasons of programming, and undoubtedly Comcast will get much informed feedback from the marketplace on its plan.
What Versant’s Launch Means for the Future of Media
The runup to the IPO could well bring some programming changes in Versant channels and perhaps changes in star lineup and contracts. While it’s no news that linear TV is in decline, the shape and success of Versant is really going to be emblematic of the speed and direction of that changed TV world.
Frequently asked questions
What is Versant and what does it include?
Versant is Comcast’s planned spinoff company, set to house most of NBCUniversal’s U.S. cable networks, including CNBC, MSNBC (rebranded as MS NOW), USA Network, E!, SYFY, and the Golf Channel. It will also encompass digital assets such as Fandango, Rotten Tomatoes, GolfNow, GolfPass, and SportsEngine.
Why is Versant’s IPO considered a major test for business television?
Versant’s IPO is seen as a significant test for business television due to the challenges of transitioning from traditional cable to digital platforms. The company aims to diversify beyond linear TV, but analysts question whether its legacy assets can adapt to the evolving media landscape.
What is the revenue outlook for Versant post-IPO?
Versant’s assets generated approximately $7 billion in revenue the previous year. However, the profitability of individual channels like CNBC and MSNBC remains undisclosed, leading to uncertainties about the company’s financial performance post-IPO.
How is Versant planning to evolve its business model?
Versant plans to evolve by acquiring digital platforms, such as fintech or personal finance services, to complement its traditional media assets. CEO Mark Lazarus emphasizes a shift towards a “house of brands” model, focusing on individual brand growth rather than a unified consumer-facing identity.
Andrew Marshall is the managing director of Cognito Americas and the vice chairman of Cognito
