Nobody can blame David Zaslav, the new CEO of the newly minted company Warner Bros. DiscoveryNot speaking his mind as he lashed out at rivals and the outgoing leadership of WarnerMedia in a first-quarter call with investors today. During the question-and-answer portion of the call, Zaslav made a comment that some interpreted as a dig at Netflix.
“We will not overspend to drive subscriber growth,” Zaslav told his investor group. as reported by IndieWire. According to a 2020 report, Netflix spent $6 billion licensing original content at the time to build a library twice the size of Amazon Prime. This month, those seeds bore bitter fruit as the streamer reported a loss of 200,000 paying customers, a trend prompting the service to take panic measures, including deliberations Host ads on their platform and imposing a fee for customers who share their passwords. All this on the heels of an unpopular increase in the price of the service.
David Zaslav’s comments on former Warner Bros. CEO Jason Kilar’s spending weren’t so veiled: “At Discovery, we almost always had $3 million in free cash flow. Now at WarnerMedia, they had $40 billion in content spend and almost no free cash flow.” This follows Zaslav’s cancellation of Kilar’s last project, CNN Plus, a month after launch.
In the call, he also took a broadside against the Kilar-era’s streaming-first approach to film distribution, capitalizing on the box-office success of The Batman as an example of how theatrical screenings help promote a film’s exposure on the HBOMax service. “Should we collapse the entire film business on streaming? I said no.’ But now the data shows ‘No Way’.”