Warner Bros. Discovery is staying on the sidelines of the Paramount Global acquisition drama — at least for now. That was the signal sent Monday by WB Discovery CEO David Zaslav during his appearance at the Milken Institute Global Conference in Beverly Hills.
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Zaslav was pressed during the hourlong panel about the status of WB Discovery’s bid to extend its TV rights agreement with the NBA, and he was pointedly asked to defend the high levels of compensation for media CEOs, including himself. Zaslav came in for criticism last week when his 2023 comp package of about $49 million was disclosed after a year in which WBD’s stock price sank by double digits.
“I think all CEOs need to be paid with alignment with shareholders,” Zaslav said. “And the majority of compensation should be aligned with the performance of the stock. And if the stock does well, then the CEO should do really should do much better. And if the stock doesn’t do well, the CEOs should not. And so I think alignment is critically important. That has been the focus for me over the years and I think it’s been the focus of investors — to get real alignment, not just between CEOs but senior leadership to be driven and be aligned with shareholder growth.”
Zaslav acknowledged that the disconnect between rising executive compensation and the erosion of earnings by rank-and-file creative community workers was a factor that fueled last year’s Writers Guild of America and SAG-AFTRA strikes. He spoke on a panel designed to examine “The Corporate Compass: Charting the Role of the CEO” that also featured Carmine Di Sibio, CEO of EY, Time magazine CEO Jessica Sibley and FedEx chief Raj Subramaniam.
“Part of that was driven by the fact that the industry was changing so quickly. We didn’t quite know exactly how to fairly compensate and we were arguing about how do you fairly compensate on a streaming service versus a cable channel,” Zaslav said. “Ultimately, the goal has to be pay your people and have them feel that they’re paid fairly and seen and valued.”
The first question out of the gate for Zaslav from moderator Andy Serwer, editor at large for Barron’s and Dow Jones, was about the state of play around Paramount Global. In December, Zaslav had a meeting with Bob Bakish, who was ousted last week as Paramount CEO, and Zaslav is known to be close to Paramount controlling shareholder Shari Redstone. But there were never any indications of meaningful merger discussions between the companies. Zaslav didn’t give a flat-out “no” to the question of whether he’s still interested in Paramount, but his tone said it all.
“I know Shari well and they have a lot of great people there. It’s in our interest for them to be successful. So however it turns out, I hope that they’re successful,” he said. “Our focus is to create more content and be on more platforms so that people spend more time and are willing to spend more money for what we create. That’s really our focus.”
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On the question of the NBA, Zaslav gave a pat answer but then underscored the importance of having pro hoops to the core of WB Discovery’s television business.
“We continue to be in constructive negotiations with the NBA,” Zaslav said. “It’s a great league. The TNT team does a terrific job. And we love the NBA.”
Zaslav emphasized that WB Discovery greatly prizes its mega events and live sports pacts that can reliably generate large audiences. The company is “one of the only real pure storytelling companies in the world,” meaning that it leans on recurring franchises like the NBA games that have aired on TNT for decades. Sports, like storytelling, has the ability to bring people together at a time from fragmentation and political polarization, he asserted.
“Sports is a big deal because for the same reasons [as storytelling] because it’s a shared experience,” he said. “It’s a positive experience. We’re all watching the [NBA playoff game between the] Knicks and the Pacers tonight. We’re all we’re all watching the Super Bowl together. [Sports] reminds us that we have so much more in common than what differentiates us.”
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