Digital Drives Defections as Two Top Guns Split with NBC

Looking to Cut 700 From Its Ranks, Network Won't Replace Falco or Zaslav

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NEW YORK (AdAge.com) -- Two unexpected and high-level departures from NBC Universal have accelerated major internal changes to an organizational chart already shaken up as part of $750 million in cost savings.
Jeff Zucker, CEO of NBC Universal's TV Group, will not be replacing the departing Randy Falco and David Zaslav.
Jeff Zucker, CEO of NBC Universal's TV Group, will not be replacing the departing Randy Falco and David Zaslav. Credit: NBC

The two defections last week are both directly related to an ongoing corporate war playing out over prized digital territory. On Nov. 14, Time Warner swooped in on Randy Falco, NBC Universal Television Group's president-chief operating officer, installing him as chairman-CEO of its resurgent AOL unit. The next day, Discovery Communications' board put the final touches on David Zaslav's contract to become its new CEO. Mr. Zaslav, NBC Universal's president-cable distribution and new media, will take his new post in 2007.

A new generation
NBC Universal Chairman Bob Wright and Jeff Zucker, CEO of the company's TV Group, are looking to lose 700 people from the payroll. Mr. Falco was regarded as a strong operational executive, and Mr. Zaslav was seen as a talented young up-and-comer, yet neither executive will be directly replaced. Instead NBC Universal is looking to a new generation of leaders, among them Jeff Gaspin, president, NBC Universal cable entertainment, digital content and cross-network strategy; Bonnie Hammer, president, USA Network and Sci-Fi Channel; Lauren Zalaznick, president, Bravo; Marianne Gambelli, exec VP, NBC Universal sales and marketing; and Bridget Baker, exec VP, NBC Universal Cable.

The importance of digital sales can be seen in one of NBC's latest appointments. The company drafted Seth Winter, head of NBC's digital-media properties, to replace Peter Lazarus as senior VP-sports and Olympics.

And now, of course, speculation is rife over who might leave the company to join their departed colleagues at AOL or Discovery, with NBC Universal President-Ad Sales and Marketing Keith Turner top of that list. Mr. Turner did not return calls for comment.

"A new CEO usually brings with them a CFO, an HR executive and their head of sales," one AOL insider said. "It remains to be seen whether Mr. Falco wants to hit the ground running or immerse himself in AOL culture first."

All about relationships
Mr. Falco was tapped for his operational skills, sales relationships and knowledge of online video-projected to be the biggest area of online ad growth in 2007, after search. Time Warner has made boosting ad sales at AOL a priority for the unit. Similarly, Discovery, trying to figure out how to migrate its content online and to portable devices, no doubt hired Mr. Zaslav for his solid relationships with cable operators and knowledge of how to best "window" content.

The appointment of Mr. Falco at AOL points to a new era for the online-media business, one that arguably depends much less on entrepreneurship than on operations and sales relationships.

News Corp. surprised cyber watchers last week when it replaced Ross Levinsohn, the executive responsible for bringing MySpace in the door, with Peter Levinsohn, a distant relative and president-digital media, who moves sideways from Fox Entertainment. Peter Levinsohn is credited with helping form the Fox on Demand effort that put ad-supported Fox shows online.

Digital leaders
Even CBS opted for fresh leadership in its digital businesses, with CBS Digital Media President Larry Kramer exiting, and Quincy Smith, a Silicon Valley insider formerly with Allen & Co., joining as president of CBS Interactive. His job: to find the next YouTube. Viacom, too, just filled its digital spot with a new chief, Mika Salmi, to head global digital media.

Meanwhile, Beth Comstock, NBC Universal's president-digital media and market development, has been making the rounds at media agencies and expanding her footprint within NBC Universal. Former iVillager Peter Naylor, now NBCU senior VP-digital sales, reports to both Ms. Comstock and Mr. Turner, and is working with Ms. Comstock to create online properties that allow for brand-integration opportunities.

One media buyer noted that the structure NBC is rebuilding may have been part of the problem. "I heard there's a four-headed monster with Jeff Zucker, Beth Comstock, Randy Falco and Keith Turner. Now I guess it's a three-headed monster."
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