Burbank, California — Warner Bros. Discovery has announced a significant restructuring plan that involves splitting its operations into two distinct entities by mid-2024. This decision reflects a strategic pivot in response to the changing dynamics of the media landscape, particularly as cable television continues to lose ground to the rapidly expanding streaming sector.

The planned division will segregate Warner Bros. Discovery’s streaming and studio operations from its traditional cable networks. Analysts have noted that while streaming platforms are thriving, with global user bases swelling into the hundreds of millions, traditional cable services are experiencing a notable decline in viewership.

HBO Max, the company’s flagship streaming service, has recently garnered acclaim with popular series such as “Succession,” “The White Lotus,” and “The Last of Us.” In contrast, networks like CNN have faced a downturn in audience engagement. According to recent ratings, CNN averaged 558,000 viewers during prime time in the year’s first quarter, down 6% from the same period in 2022.

Under the new structure, the streaming and studios segment will be led by David Zaslav, the president and CEO of Warner Bros. Discovery. This division will incorporate the company’s film operations alongside its successful streaming titles. The second entity, designated as Global Networks, will encompass several well-known brands including CNN, Discovery, and TNT Sports, and will be managed by Chief Financial Officer Gunnar Wiedenfels.

Zaslav emphasized that this restructuring aims to enhance the company’s competitive edge in an increasingly complex media environment. “We are empowering these iconic brands with the sharper focus and strategic flexibility they need to compete effectively in today’s evolving media landscape,” he stated.

Despite the strategic shift, the immediate market response was lukewarm. Warner Bros. Discovery’s shares fell nearly 3% on the day of the announcement, continuing a trend this year that has seen stock prices decrease by over 10%. Analyst Peter Jankovskis from Arbor Financial Services expressed that the separation will likely simplify the investment landscape, allowing investors to evaluate each company’s worth with greater clarity.

In January, CNN also announced layoffs of over 200 employees as part of its effort to pivot toward digital offerings, reflecting broader trends within the industry. On a more positive note, Warner Bros. Discovery reported that its streaming services boasted over 122 million subscribers at the end of the first quarter, suggesting a strong foothold in the market.

This separation mirrors recent trends among media giants, as seen in Comcast’s ongoing plans to divest its NBCUniversal cable television division. Such moves indicate a growing recognition among corporations of the need to delineate their streaming and traditional business models to better position themselves in a diversifying marketplace.

As the media industry continues to evolve, the outcomes of Warner Bros. Discovery’s structural changes will be closely watched. The company’s ability to adapt and thrive in this competitive landscape will likely depend on how effectively it can manage the new entities and leverage its existing brands for future growth.