David Zaslav Says He Fought To End Strikes, WBD Showed “Courage” In Slashing Content Slate & Staff As Industry Changed; CEO Sidesteps Pay Query In Q&A
“We’re at a very hard time that requires hard decisions, and many of them are unpopular,” Warner Bros Discovery CEO David Zaslav said in reviewing the trajectory of a company that has slashed staff and shelved content in an landscape that’s completely transformed from when the Discovery-Warner Media merger was announced in 2021.
“We said no sacred cows,” he told Andrew Ross Sorkin during a Q&A at The New York Times’ DealBook conference.
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“If we were going to start today,” he added, “what content do we need? What content is going to help us? How many people do we need? What should HBO look like? What should Warner Brothers look like?”
He called WBD’s first big layoffs “brutal” but said “these are companies that have never really been restructured for the future. And so we really decided that we have to have courage, we’ve got to figure it out.”
On the content side, Warner Bros Discovery recently raised hackles in the creative community by first shelving a finished Coyote vs. Acme before allowing others to screen it for a potential sale. It canceled Batgirl last year, raising the first big ruckus.
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Sorkin asked about accounting, which allows company’s to take write-downs. “The accounting piece is really a misnomer,” Zaslav said. “If we produce a show, a $100-million movie…We’ve spent the $100 million dollars and if we don’t release it. It’s gone. We don’t have any real benefit from it. The question is, should we take certain of these movies and open them in the theater and spend another $30 or $40 million to promote them? And Warner Brothers team and HBO made a number of decisions. They were hard. But when I look at the health of our company today, we needed to make those decisions. And it took real courage.”
“And here we are 20 months later, the company paid back…$12 billion in debt. We had to make a lot of very difficult decisions. And we had to move a lot faster than we probably wanted to, because this is a generational disruption.” That’s would be the decline of linear television and the rise of streaming and chasing subscribers with frothy sums spent on content, leading to big losses that traditional media companies are trying to reverse.
On the writers and actors strikes, the chief executive said he fought to end. But he sidestepped a question about his high compensation, which was a rallying cry on the picket lines.
“The writers, the actors, were saying, ‘look at this guy, he’s getting paid tens of millions of dollars a year and we’re over here.’ How do you deal with that personally? And how do you think about that?” asked Sorkin.
“My focus was we need to settle this strike. This is really hurting people. Every day that we were on strike, that people weren’t working was a bad day,” replied Zaslav.
Media CEOs are known for higher than the average pay but Zaslav’s packages have stood out. His compensation for 2021 was worth $247 million with stock options valued then at $203 million. His package for 2022 fell to $39 million. Pay is disclosed each spring for the previous year for companies on a calendar year. WBD recently changed its pay policies to tie his compensation less to stock price and more to free cash flow. That cash flow, needed to pay down hefty debt, has been rising, the stock has not. Zaslav said the change was a board decision.
“I did fight, and Bob Iger. There was a bunch of us” trying to end it, he added of the strikes.
Asked about his quote in a recent NYT story that writers were basically “right about almost everything,” he indicated that applied in large part to actors too. “I believe what I said. When I spoke to Fran and Duncan before, I said, I agree with a lot of what you’re saying,” referring to SAG-AFTRA’s president and executive director.
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