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Today, we're sharing an intellectual amuse bouche ahead of your Thanksgiving feast. William D. Cohan and Dylan Byers recently went back and forth in a wide-ranging conversation about the state of the media industry in 2021: Will Comcast make Shari Redstone an offer she can't refuse? Could Jeff Zucker end up overseeing MSNBC? Will James Murdoch come in from the cold? And what's the latest thinking inside Disney about spinning off ESPN?
It's a fascinating, provocative conversation—exactly the sort of inside reporting and deeply-sourced analysis that you've come to expect from Puck.
Inside the dynastic politics, boardroom dramas, and M&A land-grabs that are reshaping the media-tech-financial landscape. WILLIAM D. COHAN AND DYLAN BYERS Dylan Byers: So Bill, something happened last week that made me think of you. I was having—I was going to say coffee or drinks, but come to think of it we didn’t have anything except bottled water—with a prominent media executive (P.M.E.) and he tells me he thinks that journalists get it wrong when they state or imply that Shari Redstone is going to sell ViacomCBS.
According to the P.M.E., Redstone is very happy to finally be in charge of the company, she’s enjoying herself, and she’s not looking to offload it. I countered with the usual arguments about scale and consolidation and the reality that ViacomCBS will eventually, and necessarily, one day be acquired by someone: Comcast, Warner Bros Discovery… you name it. And the P.M.E. responds: Oh, totally, but that’s in 4 to 5 years.
The comment made me laugh, because in the world of M&A, 4 to 5 years is essentially tomorrow. Anyway, it made me wonder about your best estimate for when Shari sells and who the potential buyer(s) will be?
William D. Cohan: Well, of course, Dylan, both things can be true. P.M.E. might be exactly right. I am sure Shari is loving being the Big Fromage at ViacomCBS, finally free of her father and all the other nettlesome board members and executives that had little time for her. The director and the management ranks have been purged of all subversives and there is little doubt that she is the absolute monarch. So good for her. But that only takes Shari so far.
At the moment, ViacomCBS has a market value of $21 billion. Redstone may control nearly 80 percent of the voting power of the company—there’s no doubt she has all the reins she’ll ever need—but she has only a net worth of around $2 billion based on her and her family’s ownership of the stock. Don’t get me wrong. That’s plenty of money for anyone, or any family. But it’s largely tied up in her illiquid stake in ViacomCBS. The main reason, in my opinion, that she pushed repeatedly for the re-merger of Viacom and CBS—often over the objection of Les Moonves, the former CBS C.E.O.—was because it would be easier to one day sell her family’s stake in the company and convert the stock in ViacomCBS to cash, or liquidity of some kind. (Bitcoin, Shari?) She can’t do that until she finds a bigger company that will buy ViacomCBS either for cash, which would be a taxable event, or for stock, which would not be taxable until she sells, but which would make it easier to sell without tanking the value of ViacomCBS.
The problem with controlling so much of ViacomCBS is that she is pretty much unable to sell her stock, except through a merger or sale to another company or some other person. (Elon Musk could take it off her hands pretty easily.) So sure, I have no doubt Shari loves being the power behind ViacomCBS and loves getting plenty of attention at the Allen & Company conference. But she’s got three children who I am sure would love to get hold of some of their considerable fortune, in cash, before too long.
Byers: That all sounds right, and on top of it I also just think it’s increasingly hard to play in Hollywood at ViacomCBS’s size. Meanwhile, it’s an obvious acquisition target for any big player still pursuing scale—whether that’s the Discovery-WarnerMedia tie up, or Comcast/NBCUniversal, which is still chafing from losing WarnerMedia to Discovery. It just seems to me that for Shari, there comes a time in the next 4-5 years where someone makes an offer she can’t refuse...
FOUR STORIES WE'RE TALKING ABOUT 
The network faces a deepening talent retention crisis: Will "Morning Joe" see the next desperate payday? DYLAN BYERS 
It’s a wild paradox: Harris is the second-most powerful office holder in American history, but suddenly facing nothing but downside PETER HAMBY 
One of the country’s most respected copyright experts joins the Quentin Tarantino's battle with Miramax over script NFTs. MATT BELLONI 
The formative years of David Zaslav's career explain as much about the history of cable as they portend about the future of streaming. WILLIAM D. COHAN 
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