Jeff Shell was abruptly ousted as NBCUniversal chief executive on Sunday. The company's successor, at least for the moment, has started to settle into his new role.
Mike Cavanagh was sent from Philadelphia, NBCUniversal parent Comcast's, to the 30 Rockefeller Plaza headquarters of NBCUniversal this week. He met with dozens top executives. Cavanagh also visited the set for the "Today Show", reached out to anchors such as Lester Holt, and met late-night hosts Jimmy Fallon & Seth Meyers.
But regardless of whether Comcast chooses Mr. Cavanagh to fill the role permanently or not, the next leader will have the responsibility of leading a company that is constantly the subject of rumors and speculations about its future, including:
Will Brian Roberts combine NBCUniversal and another company as he had previously considered?
Will Mr. Roberts pursue a purchase or a complete sale of Hulu which NBCUniversal and Disney jointly own?
Will NBC give up a prime time hour to local affiliates or start negotiations with the National Basketball Association for broadcast rights?
NBCUniversal has no dire financial problems. It's home to fabled establishments such as "Saturday Night Live," "Today," and lucrative franchises like “Despicable Me” and “The Real Housewives.” It generated $39 Billion in revenue last fiscal year, an increase of 14 percent from the previous year.
The company owns several cable channels, such as USA or Bravo, that are losing viewers. Peacock's streaming service is growing fast, but it has far fewer customers than its competitors. It is expected to lose $3 billion in this year.
After Mr. Shell abruptly left, these issues were once again brought to the fore. Comcast announced Sunday that Mr. Shell is leaving the company following an investigation of a complaint alleging "inappropriate behavior."
According to Suzanne McKie, his departure came after Hadley Gamble filed a complaint against him. She accused him of sexual harassment and discrimination. Comcast executives launched an investigation in response to Ms. Gamble's complaint, which she filed at the end of March. In a Monday filing, Comcast said that Mr. Shell was fired after an investigation confirmed allegations of sexual harassment.
Mr. Roberts, Mr. Cavanagh and Mr. Shell met with Mr. Cavanagh and Roberts at the Philadelphia offices of an attorney firm on Friday. Shell told Mr. Shell was fired according to two unauthorised people who knew of the internal discussion.
Shell was shocked by the sudden change of events. In the days before his dismissal, Shell had met with legislators in Washington, D.C., and was planning to attend the White House Correspondents' Association Dinner on Saturday, two people with knowledge of the situation said. He hired Risa Heller - a crisis communication expert with a lot of experience - and a well known lawyer.
Shell declined to comment about the circumstances surrounding his departure, but in a written statement he said that he "was deeply upset by how much pain and humiliation I had brought to my family."
Shell said. "I'm only focused on making them right." Shell told Shell.
According to two sources familiar with the investigation, Comcast continues to investigate certain elements of Ms. Gamble’s complaint relating to sexual discrimination.
Comcast declined comment on the investigation. Concerning the future leadership of Comcast, a spokesperson referred The New York Times back to comments made by Mr. Roberts during Thursday's earnings call. Mr. Cavanagh was described as "a fantastic executive operator" in those remarks.
Since Mr. Shell left, Mr. Roberts sought to reassure the investors. He made a short statement on the earnings call of Thursday in support Mr. Cavanagh, and NBCUniversal executives. He praised NBCUniversal for its bench of experienced leaders and said that Mr. Cavanagh will "step in" at the helm of the company after a "tough time."
Comcast's stock price increased by about 10% after its earnings call on Thursday.
Roberts, as a sign of support, joined Mr. Cavanagh at NBCUniversal’s executive committee meetings in New York, which Mr. Shell was the former CEO of NBCUniversal, according to three sources with knowledge about the meeting. Mr. Cavanagh assured the assembled leaders that he will be staying for a long time. Next week, Mr. Cavanagh will be heading to Los Angeles for a meeting with West Coast executives.
Executives at NBCUniversal agree that the departure of Mr. Shell will not have a significant impact on the company's television, film and news assets. Shell had to get approval for his biggest decisions from Cavanagh and Roberts who are the final decision makers on major issues. Cavanagh stated that the company would not miss a beat during the earnings call.
Cavanagh is not likely to relinquish his responsibilities in the Comcast empire which includes the cable and wireless businesses.
Cavanagh has been widely regarded as the most likely candidate within the company to succeed Roberts. In some ways, a full-time position running only NBCUniversal could be viewed as a downgrade. He is the first president of the company who does not come from the Roberts family that controls Comcast.
NBCUniversal executives believe that the media assets still need a leader. It is impossible for anyone to do this part-time. There are far too many business decisions, including those involving theme parks and film studios as well as TV programming.
Comcast's wireless and broadband businesses provide it with cash that allows it to invest in streaming.
NBCUniversal is growing its movie studios and theme parks. Recent highlights include the opening of the "Super Nintendo World," at Universal Studios, and the release "The Super Mario Bros. Movie," a box-office hit. Comcast announced on Thursday that its profits increased slightly in the first-quarter despite a decline in advertising revenue and slower growth for its broadband business.
NBCUniversal's potential spin-off has been a topic of discussion for several months. This speculation was sparked by the reports that the two men considered combining their company with Electronic Arts, a video game studio. Analysts speculate that Roberts and Cavanagh may be looking for another large deal, as many of NBCUniversal’s competitors are teaming up to boost their streaming businesses.
Analysts have discussed Warner Bros. as a potential target. Discovery is the newly minted media colossus formed by the merger of WarnerMedia, which owns HBO, Warner Bros., and Discovery, which owns cable networks such as HGTV, TLC, and TLC.
Craig Moffett is a senior director at the SVB MoffettNathanson firm. He said that a merger could give the combined companies enough money to pay for the movies and television shows they would need to attract enough subscribers to make their service profitable. "But most Comcast shareholders hate that idea," said Moffett.
Mr. Moffett stated, "I believe Mike will invariably put his stamp on business, and that means, in this case, that there is a role for mergers, acquisitions or divestitures."