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It was April 2022, and David Zaslav had just closed the deal of a lifetime. From the helm of his relatively small and unglamorous cable company, Discovery, he had taken control of a sprawling entertainment conglomerate that included perhaps the most storied movie studio on the planet, Warner Brothers. The longtime New Yorker had always loved movies, and against the advice of several media peers, he had moved to Hollywood and taken over Jack Warner’s historic office, hauling the old mogul’s desk out of storage and topping it off with an old-time handset telephone. So far things were going great. He had met all the stars and players, was widely feted as the next in line to save the eternally struggling industry and was well into the process of renovating a landmark house in Beverly Hills. “You’re the dog that caught the bus,” the billionaire octogenarian cable pioneer John Malone, one of Discovery’s largest shareholders, told him. All he needed to do now was pay back the $56 billion in debt that he piled onto the new company to make the deal happen.
It was April 2022, and David Zaslav had just closed the deal of a lifetime. From the helm of his relatively small and unglamorous cable company, Discovery, he had taken control of a sprawling entertainment conglomerate that included perhaps the most storied movie studio on the planet, Warner Brothers. The longtime New Yorker had always loved movies, and against the advice of several media peers, he had moved to Hollywood and taken over Jack Warner’s historic office, hauling the old mogul’s desk out of storage and topping it off with an old-time handset telephone. So far things were going great. He had met all the stars and players, was widely feted as the next in line to save the eternally struggling industry and was well into the process of renovating a landmark house in Beverly Hills. “You’re the dog that caught the bus,” the billionaire octogenarian cable pioneer John Malone, one of Discovery’s largest shareholders, told him. All he needed to do now was pay back the $56 billion in debt that he piled onto the new company to make the deal happen.
Money is never just lying around Hollywood, and the town was still reeling from the pandemic. But that was OK. Zaslav had set a “synergy target” — cost cuts, essentially — of $3 billion in the next two years, and now, with the clock ticking, he got to work. To help, he had brought along his chief financial officer from Discovery, an amateur pilot and former McKinsey consultant named Gunnar Wiedenfels. As spring turned to summer, they laid off hundreds of workers, shuttered or reorganized divisions and suspended or canceled hundreds of millions of dollars’ worth of programming. Anything we don’t think is awesome, Zaslav told executives, stop production right now. Turn the cameras off.
Money is never just lying around Hollywood, and the town was still reeling from the pandemic. But that was OK. Zaslav had set a “synergy target” — cost cuts, essentially — of $3 billion in the next two years, and now, with the clock ticking, he got to work. To help, he had brought along his chief financial officer from Discovery, an amateur pilot and former McKinsey consultant named Gunnar Wiedenfels. As spring turned to summer, they laid off hundreds of workers, shuttered or reorganized divisions and suspended or canceled hundreds of millions of dollars’ worth of programming. Anything we don’t think is awesome, Zaslav told executives, stop production right now. Turn the cameras off.
Cuts are the norm after a merger, but Zaslav and Wiedenfels were pushing things hard, and in sometimes unorthodox directions. By shelving several nearly completed projects — including the animated, direct-to-streaming movie “Scoob!: Holiday Haunt,” and the fourth season of the postapocalyptic TV series “Snowpiercer” — they saved millions in postproduction and marketing costs, as well as residuals down the line, and they locked in hefty tax breaks up front. Like so much of what happened in Hollywood, all this was reminiscent of a Hollywood production — in this case, the beloved 1967 Mel Brooks comedy “The Producers.” There, the producers, Max Bialystock and Leopold Bloom, realized that under the right circumstances, a producer could make more money with a flop than a hit. For Zaslav and Wiedenfels, the money would come from making sure that no one would get to see the shows in the first place.
Cuts are the norm after a merger, but Zaslav and Wiedenfels were pushing things hard, and in sometimes unorthodox directions. By shelving several nearly completed projects — including the animated, direct-to-streaming movie “Scoob!: Holiday Haunt,” and the fourth season of the postapocalyptic TV series “Snowpiercer” — they saved millions in postproduction and marketing costs, as well as residuals down the line, and they locked in hefty tax breaks up front. Like so much of what happened in Hollywood, all this was reminiscent of a Hollywood production — in this case, the beloved 1967 Mel Brooks comedy “The Producers.” There, the producers, Max Bialystock and Leopold Bloom, realized that under the right circumstances, a producer could make more money with a flop than a hit. For Zaslav and Wiedenfels, the money would come from making sure that no one would get to see the shows in the first place.
Then they came for “Batgirl.” The big-ticket streaming project had just finished filming in Scotland when Zaslav took over, and he and Wiedenfels had immediately identified it as a target — a “free ball,” as Zaslav described it to several colleagues. The audience test scores for a very early cut were not encouraging. Still, a number of executives warned him not to shelve it. “Batgirl” was a $90 million entry in a multibillion-dollar universe of movies and television shows based on DC Comics. Michael Keaton was reprising his role as Batman, and sequels were already in the works. Plenty of movies had tested poorly but still earned millions. Killing an all-but-completed movie would alienate the people Zaslav — or at least Hollywood — needed most: the people who made the movies. It was to no avail. On Aug. 2, the word came down: “Batgirl” was dead.
As predicted, the backlash was immediate and emotional. Stunned, the film’s up-and-coming directors, Adil El Arbi and Bilall Fallah, tried to look at their footage, but their access to the production server was denied. The head of the DC unit, Walter Hamada, who was not consulted on the decision, asked to be released from his contract and would leave before the end of the year. Courtenay Valenti, one of the most respected development executives at Warner Brothers, was equally devastated and would be gone in a matter of weeks, ending a 33-year run at the studio. The news dominated the Hollywood trades for days. Under fire, Zaslav defended the decision in an earnings call with analysts, saying he shelved “Batgirl” to protect the DC brand. More quietly, Zaslav also sought cover in the authority of Bryan Lourd, the powerful co-chairman of Creative Artists Agency and a leading arbiter of Hollywood mores. As Zaslav told it to several associates, Lourd had supported the decision, observing that it wasn’t in the interest of C.A.A. clients, like the film’s star, Leslie Grace, to be associated with a bad movie. But a C.A.A. spokeswoman denied that. “Bryan Lourd was not consulted in advance of the studio’s move to cancel ‘Batgirl,’” she said.
At Discovery, producers referred to having their budgets slashed as “getting Gunnared,” and Wiedenfels maintains a hard-boiled, McKinsey-esque attitude toward the bottom line. “It’s hard work,” he says. “You don’t make friends.” Zaslav, a born salesman who would prefer to make friends, is more reflective. “You do sometimes get bloodied,” he said in a wide-ranging interview at Warner Brothers Discovery’s corporate headquarters in New York. But business is business. “We have made unpopular decisions because they were necessary.”
Hollywood was in trouble before David Zaslav came to town. The days when Hollywood monopolized the public’s attention and shaped the global imagination were long gone. Streaming had turned the town’s economic model on its head. The threat of computer-generated scripts and movie stars was already rising, and attendance at movie theaters was still recovering from the pandemic. But W.B.D. now faces a much more specific and no less urgent problem: It is shackled with a colossal debt load, the price of the merger that brought Zaslav to power.
Over the last six months, we spoke with more than 100 executives, agents and actors about Zaslav’s leadership of W.B.D., which put him at the center of one of the most tumultuous periods in the history of the entertainment industry. During his tenure, he would become the widely reviled symbol of Wall Street’s exploitation of the town — “perhaps the most hated man in Hollywood,” as he was once called — and a catalyst for two historic labor stoppages that he would personally try to resolve. In all this time, he and his team have greenlit little big-budget content, but he has generated billions of dollars in cash through cuts and made many tens of millions of dollars himself. The company’s most recent earnings report, in early November, was met with one of the biggest single-day sell-offs in W.B.D.’s short history; the stock has now lost well over half its value since Zaslav took charge.
“We have to transform this company, and this whole industry that really hasn’t been transformed, and we have no time to waste,” Zaslav says. But now that the actors’ strike has been resolved, finally bringing Hollywood back to work again, the question lingers: Is Zaslav saving Hollywood or wrecking it?
At 63, Zaslav is two generations removed from the Jewish outsiders — William Fox, Adolph Zukor, Samuel Goldwyn — who fled the shtetls of Europe a century ago and built Hollywood, making movies that went a long way toward defining the American dream. Zaslav, whose paternal grandfather sold plumbing supplies out of a wheelbarrow on the Brooklyn Bridge, sees himself as part of this lineage of unlikely moguls, and in fact his grandmother grew up in Warsaw not far from where Jack Warner’s parents were raised. “His family and my family came here with nothing,” Zaslav said.
As a young boy in Brooklyn, Zaslav spent Saturday afternoons at the movies with his father, who worked for the family plumbing business, now called Zaslav & Sons, while attending law school at night. “Cool Hand Luke,” “Funny Girl” and “Butch Cassidy and the Sundance Kid” all loom large in his memory. The family prospered, moving to the suburbs, and Zaslav went on to graduate from Boston University Law School. He started his career at a corporate law firm in New York but soon seized the chance to get a little closer to the action, talking his way into a job at NBC. He rose to become the head of its lucrative cable division and, in 2007, took over Discovery, transforming it from an earnest, niche provider of educational nature and science programming into a multichannel reality-TV cable juggernaut. Along the way, Zaslav became one of the highest paid chief executives in America, earning far more than the heads of much larger companies.
Zaslav started spending summers in East Hampton, striking up friendships with Steven Spielberg and other boldfaced names and hosting a star-studded annual Labor Day party at his large beachfront estate. (He sometimes refers to his Hamptons place as “Shutterz with a Z,” a Zassification of the luxury Santa Monica hotel Shutters on the Beach.) He befriended David Geffen, a founder of DreamWorks and a Hollywood fixture, vacationing on his yacht with still more boldfaced names. His largely male inner circle — they call themselves the Schmoozers — would come to include the producer Brian Grazer, Activision Blizzard’s chief executive, Bobby Kotick, and other entertainment kingpins. “He has an interest in Hollywood I never would have,” says Lloyd Blankfein, the former chairman of Goldman Sachs and occasional guest at Schmoozer outings. “Now he talks about movie stars and uses their first names. I don’t even know who they are: Margot? Margaux? The wine? Hemingway? He knows all these people. I told him: ‘David, I’m a civilian. So you have to use their whole names.’”
Zaslav’s love of Hollywood is sincere. He bought his house in Beverly Hills before he got his current job — and it wasn’t just any house: It was Woodland, the home of Robert Evans, the legendary producer of “The Godfather” and “Chinatown.” Greta Garbo once stayed there, and during Evans’s heyday at Paramount in the 1960s and ’70s, it was a favorite hangout for Hollywood’s biggest stars. Zaslav pursued the house even before it went on the market. After Evans died in 2019, another Hollywood-connected friend of Zaslav’s, Graydon Carter, the former editor of Vanity Fair, reached out to Evans’s ex-wife Ali MacGraw, attesting to Zaslav’s intention to meticulously restore Woodland to its vibrant, Old Hollywood glory. Zaslav hired Michael Smith, who redesigned the Oval Office for President Barack Obama, for the job. Sensing Smith’s enthusiasm for the project, Zaslav, inveterate dealmaker that he is, asked for a discount. Smith refused.
So when AT&T decided to offload its WarnerMedia division in late 2020 and, after some deliberation, landed on Zaslav as its preferred buyer, he was ready. The deal itself quickly took on a little Hollywood spin, with reports that it started with a golf-emoji-laden email that Zaslav sent to AT&T’s chief executive, John Stankey, on an otherwise-lazy Saturday afternoon in February 2021.
In fact, Zaslav had urgent business reasons to do the deal. Streaming was threatening the future of everything he built at Discovery, jeopardizing his lucrative TV advertising contracts and cable deals. Everyone was chasing Netflix by creating their own streaming platforms, and he would, too, but how many people were going to pay hefty monthly subscription fees to watch old episodes of “Dr. Pimple Popper” and “Here Comes Honey Boo Boo”? A frenzy of mergers and acquisitions was already sweeping across the industry, and he was in danger of being left behind. He needed more assets, and WarnerMedia — which, in addition to the Warner Brothers studio, included HBO, CNN and other cable networks, a thriving video-game division and rights to “Harry Potter” movie merchandise and theme-park attractions — looked like the answer. “David desperately wanted to do it,” says Malone, whose stake in the company gave him veto power over the deal.
But the acquisition also represented much more than a financial lifeline for Zaslav. “He really felt emotional,” says Barry Diller, an old friend and fellow media mogul, describing Zaslav’s reaction to the acquisition. “He thought, Oh, my God, I inherited Jack Warner and the great Warner Brothers water tower. Sincerely, I think he believes in the old-time movie business. Why not? He came from nowhere.”
Still, a number of media executives, including Jeff Bewkes, the former chief executive of Time Warner, advised Zaslav to stay in New York and leave Hollywood to the Hollywood people. It was great that he was a movie enthusiast, but he had never overseen a major movie studio or, for that matter, much in the way of scripted television programming. The chief executive of the Warner conglomerate had historically lived in New York and worked out of its corporate headquarters. Zaslav had other plans. He announced them via Zoom at an investor conference in June 2021, just a few weeks after the deal became public. “I am moving right into the Warner Brothers lot,” he said. “I want to be where the content is made.”
It would take almost a year for the acquisition to be approved. Zaslav intended to use that time to conduct what he called a Hollywood listening tour. Diller urged him not to do it, warning that his financial imperatives — the urgent need to generate cash and cut debt — would force him to reject most of the advice he received. But Zaslav rejected Diller’s advice too. He was eager to win over his new town. “Barry is brilliant,” he says, “but I felt that I needed to listen.”
Woodland was still in the midst of its renovation. The project had taken on a whole new meaning for Zaslav since the deal; he spoke of it now as a “narrative,” one from which both the house and Warner Brothers would emerge as emblems of a new golden age in Hollywood. But for the moment, he just needed a place to stay. He rented a bungalow at the Beverly Hills Hotel, long the center of Hollywood deal-making, and held court at its restaurant, the Polo Lounge, interviewing actors, writers, producers, agents and former studio heads. Lourd and his superagent rival at Endeavor, Ariel Emanuel, hosted parties for him and set up dinners with cinematic royalty like Warren Beatty and Annette Bening. Zaslav reassured his anxious audiences around Hollywood, telling them that he was committed to continuing the industry’s great legacy of storytelling in this uncertain new age. There would be more movies, bigger movies, and not on laptops or TV screens but on the big screen, where they belonged.
A pair of favorable profiles preceded his arrival in Hollywood, one in Vanity Fair (“All That Zaz,” it was headlined) and the other in Variety (which called him “Hollywood’s new tycoon”). Hopes were running high. “Everyone is excited about the fact that he has such a respect for the legacy of talent at Warner Brothers,” the TV producer Greg Berlanti, who has an exclusive development deal with the studio, told The Hollywood Reporter. “Everywhere you go, everyone seems to be jazzed.” At his first town hall for employees after the deal closed, held in a packed auditorium on the Warner Brothers lot, Zaslav assumed the mantle with considerable ceremony. He carried the leather portfolio once owned by Steve Ross, the longtime and legendary head of Warner Communications, onto the stage and told the audience that he intended to keep it on his desk — Jack Warner’s desk — as a tribute to the studio’s great legacy. But the reality was that Zaslav was not appointed by the board to extend the Warner Brothers legacy. “Cut costs and pay down debt, and do the best you can,” Diller says. “That’s his job. It’s not complicated.”
There were some complications, though. Investors were having second thoughts about the once seemingly boundless growth potential of streaming, and stock prices were plummeting across the entertainment-and-media sector. For W.B.D., the decline in value was especially stark. It closed its first day of trading in April 2022 at $24.78. By early August, following the killing of “Batgirl” and the rest of Zaslav’s early cuts, it was hovering at around $13. In October, with the stock price still basically unchanged, two Ohio state pension funds sued the company, accusing it of misleading investors about the finances of the merger.
Undeterred, Zaslav’s team laid off thousands more people and, in another cost-saving innovation, removed some of their own content, including nearly 200 episodes of “Sesame Street” and dozens of movies, from HBO Max to spare the company residual payments linked to long-term viewership numbers and enable more write-downs. In November, he raised his synergy target from $3 billion to $3.5 billion. A few months later, just weeks after his celebrity-heavy 63rd birthday party at Mr. Chow in Beverly Hills — guests included Larry David, Kevin Costner and Robert Downey Jr. — he raised the target yet again, from $3.5 billion to $4 billion.
Even as the cuts accumulated, the stock remained stuck. This posed a more personal problem for Zaslav: His pay was closely tied to W.B.D.’s share price. His 2021 total compensation was a staggering $246.6 million. But as the stock crashed in 2022, so did Zaslav’s compensation, falling to $39.3 million. He was slashing and burning like a champion; even if Wall Street wasn’t pleased, the board was. Although Zaslav has said many times that money doesn’t interest him — he works now, he says, for his legacy — he didn’t object in March when the board amended his contract to address this problem. In the future, his compensation would be linked less closely to the stock price and more closely to the cash flow he was creating, largely through cuts. Still hunting for cash savings, Zaslav announced in April that he was combining Discovery’s unscripted programming with HBO’s scripted programming and other content from the Warner Brothers library into a single streaming service, Max, an unlikely pairing that one W.B.D. executive half-jokingly referred to as “‘MILF Manor’ meets ‘Succession.”’
To Hollywood, all this was starting to look depressingly familiar. “The series of mergers that led us here — first the $85 billion AT&T-Time Warner merger and then the $43 billion WarnerMedia Discovery merger — have each promised to create a better competitor, but have instead left the merged entity debt-burdened and focused on cutting costs to rationalize these disastrous business decisions,” the Writers Guild of America West said in a report in late January. The streaming wars had been punishing for most of Hollywood’s writers. The hunger for content spawned a ceaseless wave of corporate consolidation that turned a high-wage, hits-driven business into a high-volume, low-wage one. Screenwriting became gig employment as royalties shriveled, the size of writing rooms shrank and seasons were shortened. And now everyone was retrenching. The writers had been disrupted, but unlike Zaslav, they had not been able to find a way to grow their salaries.
The W.G.A.’s contract with the entertainment and tech companies was set to expire at the beginning of May. The union, which represents about 15,000 writers, had fought to make sure its members weren’t on the losing end of disruption many times before, as when movies first started airing on TV, during the dawn of home video or the rise of internet distribution. The W.G.A. was determined to claw back some of the benefits and protections that its members lost in recent years, as well as insulate them against looming threats like artificial intelligence. The companies that sold entertainment were still enormously profitable, their executives better paid than ever; why were the writers losing out? The entertainment and tech companies, represented by the Alliance of Motion Picture and Television Producers, initially rejected many of the union’s demands.
The night before the writers were set to go on strike for the first time in 15 years, freezing dozens of film and TV productions, Adam Conover, a comedian and board member of W.G.A. West, called out Zaslav on his own network, CNN, citing his astronomical compensation in 2021: “That’s about the same level as 10,000 writers are asking him to pay us collectively, all right?”
The strike started on May 2. A few weeks later, Zaslav delivered the commencement address at Boston University, his law-school alma mater, jaunty as ever in a red doctoral robe and Wayfarer sunglasses. The chants started immediately, and hecklers continued to disrupt him throughout his 20-minute speech. Overhead, an airplane trailed a banner: “DAVID ZASLAV — PAY YOUR WRITERS.”
Warner Brothers was turning 100 in 2023, and Zaslav decided to throw a big birthday bash for it at the Cannes Film Festival. It was scheduled for May 23, the date of Max’s launch, making it an even more momentous day for him and his company. This could turn things around.
The party was actually Graydon Carter’s idea. Zaslav had proposed throwing some version of the glitzy Oscar parties Carter had hosted when he was the editor of Vanity Fair, possibly even at Woodland, if it was ready in time. But Carter, who was now running his own media company, Air Mail (in which Zaslav was an investor), counteroffered with Cannes. It would be a joint Air Mail-W.B.D. production. Carter would do the planning, design work and invitations, and W.B.D. would pick up the bulk of the considerable tab. Zaslav leaped at the idea, forgoing a full calendar of proposed centenary events — a red-carpet event with movie stars, a concert at the Hollywood Bowl, special screenings of classic Warner Brothers films — to go big on Cannes, working through all the details in weekly creative calls with Carter.
But when the writers walked out, the party took on a different cast, more redolent of the Ancien Régime than of golden-age Hollywood. Zaslav’s chief corporate-communications officer, Nathaniel Brown, strongly urged him to cancel, but Zaslav plowed ahead. “Canceling it,” Carter says, “would have been just as costly as putting it on.”
The party, held at the Hôtel du Cap-Eden-Roc, was epic. Carter choreographed every detail, emblazoning everything — even the lampshades and ceramic ashtrays — with both the Air Mail insignia and the iconic Warner Brothers logo. Numerous movie stars — Leonardo DiCaprio, Scarlett Johansson, Robert De Niro — were on hand. Classic scenes from Warner Brothers movies were projected onto the surface of a blackened infinity pool. For Carter, the night was an unqualified success. “Apple did a party, too, but you don’t know about it because it was probably awful,” he says. “Ours got more attention because we did a better job.” It was all the more satisfying to Carter because Vanity Fair’s Cannes party a few nights earlier, hosted by his successor, coincided with a rainstorm.
But with thousands of unpaid screenwriters walking the picket lines back in Hollywood, the cognitive dissonance was hard to ignore. A number of those in attendance tried, with mixed results, to hide from the cameras. Some wondered: Why was Warner Brothers celebrating its 100th anniversary in France, not in Hollywood? How had the iconic studio’s centenary celebration become a branding opportunity for Carter’s New York-based media company? Was this really the right moment for Zaslav to spend a fortune on an over-the-top party at a posh hotel on the French Riviera? It all seemed sad, and also ridiculous. Back in Hollywood, photos of Zaslav and Carter standing side by side in strikingly similar summer cocktail attire drew mocking comparisons to Arnold Schwarzenegger and Danny DeVito in the movie “Twins.”
Even as Zaslav was enjoying his Sun King moment in France, the revolutionary forces were gathering in Hollywood. Far from energizing the creative community, the launch of Max unleashed a fresh wave of unexpected outrage at the executive class. The redesigned service had streamlined its credits for films and TV shows, compressing all the writers, directors and producers for every show under the single, seemingly unobjectionable category of “creator.” Amid the outcry, W.B.D. blamed an “oversight” for the change and promised to fix it, but not before the president of the W.G.A. West, Meredith Stiehm, folded it into their growing list of grievances: “This tone-deaf disregard for writers’ importance is what brought us to where we are today.”
The bad press only got worse. In early June, The Atlantic published a 15,000-word profile of CNN’s president, Chris Licht, who was Zaslav’s first big hire. Licht had granted the writer a mystifying degree of cooperation, and Zaslav was upset that, in his terms, Licht had “lost the narrative.” The media loves nothing more than a good media story, and this one stayed in the news cycle for days. Already the face of the network’s very public problems, including its recent decision to give Donald Trump more than an hour’s worth of exclusive airtime, during which he lied repeatedly, Licht now became a figure of ridicule in the press.
Zaslav had told a few confidants that he planned to give Licht six months to turn things around. But in the days after the Atlantic profile appeared, he changed his mind. Not only was the media somehow still covering the embarrassing story, but one of Zaslav’s senior executives, David Leavy, had taken the temperature of prominent figures at CNN and reported back to Zaslav that Licht had lost the newsroom. On June 7, with Manhattan enshrouded in an orange haze from Canadian wildfires, Zaslav invited Licht on an early-morning walk through Central Park and told him that he was making a change.
Zaslav needed to turn things around, and it was clear how. There was only one thing in Hollywood that could erase any number of missteps and also deliver a big load of cash: a hit. And so he tried to will one into existence.
The movie, which would open in mid-June, was “The Flash.” There were reasons to be hopeful. Superhero movies were the rare genre that still performed reliably well at the box office. And “The Flash,” which cost $225 million to make, was supposed to mark the beginning of the relaunch of the company’s DC universe of characters. Zaslav had a lot invested in DC intellectual property, which had been part of the company for decades but had not achieved the same success as Disney’s Marvel Studios. “Where’s my Kevin Feige?” he asked no shortage of agents and executives when he first came to town, referring to the executive credited with reinventing Marvel. (The question did not endear him to the head of the DC unit at the time, Walter Hamada.)
Zaslav eventually hired James Gunn, who directed the “Guardians of the Galaxy” films for Marvel, and his partner, Peter Safran. Now they were, as Zaslav put it, “on a mission from God” to rebuild DC. The star of “The Flash,” Ezra Miller, was a problematic superhero, facing a spate of very public legal troubles. The fact that W.B.D. couldn’t put the star out in front of the people was a promotional nightmare. But Zaslav could do some promotion of his own. He had buried one big-budget DC movie, “Batgirl,” deciding that he could generate more cash by ensuring that audiences would never see it, but he decided to personally vouch for “The Flash.”
There’s an ironclad, if unwritten, rule among Hollywood executives to never personally hype a movie before its release. It’s partly just superstition, but it’s also an acknowledgment of the intrinsically unpredictable nature of the business — “nobody knows anything,” as the screenwriter William Goldman once put it. Only the audience could make a hit. But Zaslav was determined to try anyway. “It’s a wow,” he said of “The Flash” on an otherwise undazzling earnings call in February. “I’ve seen it three times,” he told a room full of movie-theater owners at the CinemaCon convention in Las Vegas in April. “To me, it’s the best superhero movie I’ve ever seen.” In fact the early buzz on the movie was pretty good, but Zaslav had seemingly put a Hollywood curse on it: Why was this studio chief talking up one of his own movies like that? It must be worse than everyone thought. “The Flash” bombed. Having been expected at one point to earn at least $85 million on opening weekend, it cleared just $55 million.
Zaslav kept finding new ways to infuriate Hollywood. In late June, he made cuts at TCM, the widely beloved commercial-free channel devoted to preserving the legacy of old films. Many people told him not to do this. Terry Press, a marketing consultant and former studio head known for her candor, told him that if he proceeded with his plans to gut TCM, he might as well stop renovating Woodland because no one would go to dinner there. Zaslav made the cuts anyway, increasing content spending but slashing the network’s payroll. Instead, the network’s senior management team all submitted their resignations at the same time, prompting more bad headlines. Press called Zaslav’s communications chief, Nathaniel Brown. “How much did you save?” she asked. “If you saved $20 million, congratulations — because you just got $100 million worth of bad press.” (When all is said and done, he will have saved about $3 million.) This one required real damage control, including a well-publicized call with Spielberg, Martin Scorsese and Paul Thomas Anderson — all avowed champions of TCM — asking them to join the network as unpaid programming curators. He kept most of the cuts in place, but TCM’s head of programming, Charles Tabesh, who was among those who resigned, was persuaded to return. Press was also hired as a consultant for TCM. “Is it that they really don’t agree, or is it that they’re not getting what they want 24/7?” she now says of Zaslav’s Hollywood critics. “Leadership is not the same as popularity.”
Zaslav was certainly not popular. In the wake of the TCM debacle, over the long Fourth of July weekend, GQ magazine posted a scathing opinion piece about him. The freelance film critic Jason Bailey, a regular contributor to The Times, was given the assignment — his first for GQ — to explain, with plenty of “voice,” how David Zaslav had become “perhaps the most hated man in Hollywood.” Bailey delivered, comparing Zaslav to the Richard Gere character in “Pretty Woman,” a ruthless corporate raider from New York who hires an escort to keep him company for a week. As soon as Brown saw it, he complained to GQ that no one at the company had been contacted for comment. The magazine declawed the story, and Bailey asked to have his name removed, forcing GQ to take it down and turning a fleeting blog post into a national news story.
It was becoming clear that the Hollywood that Zaslav had stepped into — modern Hollywood — was very different from the one he valorized in his youth. It was not just the discordant combination of his ruthless cost-cutting and exorbitant salary, or even his exorbitant spending on an opulent party while thousands of writers were going unpaid, that was turning the town against him. It was what appeared to be a larger failure to grasp that Hollywood was a much different place than he perhaps imagined — more egalitarian, more politically engaged — if no less focused on who was getting paid and how much. It had not gone unnoticed that the senior corporate management team he imported to W.B.D. from Discovery was largely male. Or that over opposition from some within his own studio, he had managed to find $45 million to commit to at least one film, a mob movie now called “Alto Knights” written by an old pal of his from New York, the 90-year-old Nicholas Pileggi, co-produced by one of his East Hampton friends, the 92-year-old Irwin Winkler, and starring the 80-year-old Robert De Niro. The writers’ strike was itself not merely about disruptive technological change. It was also about Hollywood joining a larger fight against structural economic inequality that was spreading through industries across America. Zaslav had come to Hollywood to save Discovery and become a studio mogul. He had instead become the personification of the out-of-touch and overpaid corporate C.E.O.
Zaslav was puzzled by Hollywood’s animosity. It was a tough town. His friend Ken Lerer, a venture capitalist with whom he speaks most days, volunteered an analogy, comparing Hollywood to Washington, D.C. “Agents, writers, directors, producers — everybody hugs and kisses you and gets whatever they can,” Lerer recalls telling him. “Then the deep state takes over.”
By the middle of July, the writers had been striking for more than two months, and there had still been no meaningful conversations between the two sides. Things were getting nasty. In an interview with CNBC at Allen & Co.’s Sun Valley conference — an annual retreat for the world’s richest media moguls — Disney’s chief executive, Bob Iger, waved away the financial concerns of the workers who created his company’s product: “There’s a level of expectation that they have that is just not realistic.” According to the Hollywood trade publication Deadline, studio executives claimed to be getting good feedback from Wall Street on the strike and were planning to simply wait out the writers or even break the union. “The endgame is to allow things to drag on until union members start losing their apartments and losing their houses,” one executive reportedly said.
Just when it seemed as if things couldn’t get any worse, the actors walked out. For the first time in more than 60 years, both the W.G.A. and the Screen Actors Guild-American Federation of Television and Radio Artists, which represents about 160,000 workers, were on strike at the same time. The town ground to a halt.
And then, like the third act of a Hollywood blockbuster, came the unexpected turn, the one thing that could save the day for everyone: an actual hit.
“Barbie” was greenlit by the previous regime at Warner Brothers, and its biggest champion inside the studio had in fact been Courtenay Valenti, who was now working at Amazon. It was a leap of faith in the film and its filmmakers, Margot Robbie and Greta Gerwig; before it went into development, the box-office projections were not promising, and it was hard to see how a movie about a doll for young girls was going to find a large audience. During development, the film’s budget ballooned to $145 million from $80 million, a price tag that looked especially conspicuous in the new, hyper-cost-conscious Zaslav regime. Pam Abdy, whom he had named co-chair of the studio, told Gerwig that she would have never greenlit “Barbie” at its existing budget, according to several people familiar with the remark. (A spokesperson for the studio denies that Abdy said this.)
As the buzz around “Barbie” started to build, so did Zaslav’s enthusiasm. If there was one thing he could do, it was market a product. At Discovery, he transformed “Shark Week” into a cultural phenomenon with promotional stunts like staging a race between the Olympic gold medalist Michael Phelps and a shark. (Phelps was in fact swimming alone in a time trial, and the shark that he was supposed to be racing against was just a computer-generated image, but it still pulled big ratings.) Now Zaslav had a whole media conglomerate at his disposal. He told his marketing team to engage every division of W.B.D. to help turn the summer of 2023 into “the summer of Barbie,” and they did. There was a four-part Barbie Dreamhouse Challenge series on the home-improvement channel HGTV, with teams competing to turn an actual home into a Barbie Dreamhouse, and a Barbie-themed episode of “Summer Baking Championship” on the Food Network, in which all of the desserts had to be pink. Warner Brothers even partnered with Airbnb to renovate a rentable, real-life Barbie Dreamhouse in Malibu. Zaslav liked to send out gift boxes to his hundreds of friends and acquaintances; before the premiere, he assembled a Barbie-themed one, with dolls, toy Malibu Barbie beach cruisers and pink T-shirts and hats.
It was, of course, a huge hit — a true blockbuster, bringing in a whopping $162 million in its first weekend while reminding America why it loved going to the movies. It was a moment of triumph for Hollywood, a validation of its enduring cultural relevance. Even now, amid the fragmentation of the media, it had not lost its democratic power to attract and transport mass audiences all over the world. No less important, the movie’s success was a rebuke of the streaming-age conviction that you could use data to engineer a hit or, for that matter, predict one. Even in the era of algorithms, it seemed, nobody knows anything. “It’s the kind of good news you get in the movie business but don’t deserve,” Diller says of “Barbie.”
It was a moment of triumph for Mattel too. The company’s chief executive, Ynon Kreiz, was a former media-and-entertainment executive himself, and “Barbie” was part of his much larger strategy to turn Mattel into an intellectual-property company, with a deep pipeline of movies based on its toys. (Coming soon: a Hot Wheels movie, a Rock ’Em Sock ’Em Robots movie and a horror-comedy film based on the Magic 8 Ball.) He hailed the movie as a “milestone moment” for his plan and was celebrated as a genius. Mattel’s shares had been surging for months as enthusiasm about the movie, and Kreiz’s larger, Hollywood-centric strategy, built.
Shares of W.B.D., by contrast, stayed flat. One movie was not enough to change Wall Street’s perception of the company, which was that it was overburdened with debt and not primed for growth. Zaslav’s stock wasn’t up, either, at least among those who saw him as a symbol of corporate greed. On the Monday after “Barbie” weekend, Representative Alexandria Ocasio-Cortez joined a crowd of protesters in a W.G.A. and SAG-AFTRA rally outside W.B.D.’s global headquarters in Manhattan. “This is a fight against the endless pursuit of more wealth,” she said. “How many private jets does David Zaslav need?”
There was still one source of solace for Zaslav: cash flow. When W.B.D. reported its earnings to Wall Street in early August, the big news was that it had generated $1.7 billion in cash flow in the most recent quarter, enabling the company to pay down more of its debt. Most of this was because of Zaslav’s strict cost-cutting regime, but the writers’ strike had been a boon, too, enabling W.B.D. to save “in the low $100 million range” during the quarter. Of course there were challenges, Zaslav told analysts. The studio and DC had “underearned their potential” — “Barbie” was not part of that quarter — and this was, moreover, a tough time for the business. Wiedenfels, Zaslav’s longtime chief financial officer, said that he was “incredibly proud” of that $1.7 billion, but there was a lot more where it came from; his “transformation team” was looking for more savings.
Cash flow was not everything, though. A few weeks later, W.B.D. filed a so-called Form 8-K with the Securities and Exchange Commission. These forms are required whenever public companies experience a major event about which they need to notify shareholders. In this case, the major event was the strikes. While they were saving W.B.D. cash in the short term, they would cost it money in the future. They were adjusting their earnings expectations for the year downward by $300 million to $500 million, largely because of the work stoppages.
It was a bottom-line assessment that reflected an obvious truth that Zaslav could no longer ignore: For this company that he wheeled and dealed and, above all, borrowed into existence to have any chance at success, he needed to make things. “Barbie” had demonstrated that movies could still draw huge crowds, vindicating the inherently risky financial proposition of spending hundreds of millions of dollars making and marketing a single film. At Discovery, Zaslav had produced a lot of not particularly exalted programming, but it was programming nonetheless, shows that people wanted to watch and that made a lot of money. Zaslav and Wiedenfels could squeeze W.B.D. all they wanted; there were always more people to fire and more projects to kill. But if he wasn’t also making entertainment, nobody — neither Hollywood nor Wall Street, apparently — was going to be happy.
Bob Iger’s comment at Sun Valley, describing the writers’ demands as “not realistic,” had hurt his standing in the creative community and created an opening for someone in the halting labor negotiations. Zaslav had been speaking regularly to Aryeh Bourkoff, the entertainment-and-media banker who helped handle the sale of WarnerMedia to Discovery on behalf of AT&T. The way Bourkoff saw it, Zaslav had an opportunity to improve his reputation in Hollywood — “to pivot back to the creative community,” as Bourkoff put it — and maybe even hasten the end of the strike. He told Zaslav that this could be his “Lew Wasserman moment,” referring to the Hollywood mogul who for years successfully managed disputes between the studios and the creative community. And so Zaslav was trying. Not long after the actors went on strike in July, he called Christopher Keyser, the producer and writer who served as a co-chairman of the W.G.A.’s negotiation committee, to try to defuse the tension and signal that he was open to talking.
During the early months of the writers’ strike, the negotiators for the Alliance of Motion Picture and Television Producers had handled the talks. Zaslav was among those who pushed for a direct meeting between the studio executives and the W.G.A., and in late August one was scheduled. The writers, who had just rejected a proposal from the studios, saw it as a power play. “They are treating us like children,” one comedy showrunner told The Hollywood Reporter. “Flying in C.E.O.s to explain why this is a good deal and we should take it. Bring in Mom and Dad and give us a lecture.”
They did not return to the negotiating table for another month, until mid-September. This time, the two sides quickly worked their way toward a deal. The W.G.A. had a list of demands it considered critical to ensuring that screenwriting would remain a viable profession in the age of streaming — and, in turn, that entertainment would still get made. As the union saw it, the first step to saving Hollywood wasn’t corporate consolidation or financial engineering. It was paying writers to produce scripts. The studios had initially rejected many of the W.G.A.’s demands. But now, with the actors also on strike and the studios’ pipelines quickly drying up, they agreed to minimum staffing requirements for writers’ rooms on shows that were still in development, and for shows that had already been greenlit. They agreed to viewership-based residuals for streaming shows. They agreed to limitations on the use of artificial intelligence in the writing process, and much more.
They reached a tentative deal on Sept. 24. After months of resistance, the moguls capitulated on just about every front. Zaslav says he has no regrets: “They are right about almost everything. So what if we overpay? I’ve never regretted overpaying for great talent or a great asset.”
Zaslav may not yet have saved Hollywood, but he has saved a lot of money. Nineteen months into his leadership of W.B.D., he has long since blown past the $3 billion synergies target that he initially promised Wall Street within two years. But for all this corporate creativity, anyone hoping to get in on the ground floor of something big with W.B.D. has lost more than half his money. The shareholder lawsuit is still pending. But the board’s faith in Zaslav remains firm. Steve Newhouse, a W.B.D. director and co-president of the Advance media company, a major shareholder in both Discovery and W.B.D., said in an email that the company is “strongly supportive” of his leadership. Zaslav can point to some genuine accomplishments during his tenure: CNN seems to have stabilized under Mark Thompson, the former BBC and New York Times head, whom Zaslav named to replace Licht. “Barbie” was a marketing triumph, and HBO and Max earned 127 Emmy nominations this year.
The challenge Zaslav faces is nevertheless acute. W.B.D. issued its latest earnings on the morning of Nov. 8. The company lost over $400 million in the last quarter, a marked improvement over the previous year but still worse than Wall Street expected. The market’s reaction was swift and severe: W.B.D. stock immediately dropped 18 percent. The company’s cable networks, which are still responsible for nearly half its revenues, are melting down faster than anticipated, and streaming does not look like the answer it once did. There’s too much competition for subscribers, and keeping them is its own challenge, requiring a lot of big swings on new content. W.B.D. streaming services lost 700,000 subscribers in the most recent quarter and lag far behind Netflix. Results from the movie studio were discouraging too. Even with the huge success of “Barbie,” revenues increased only 4 percent over the previous year. The ever-optimistic Zaslav seemed uncharacteristically discouraged on the earnings call: “This is a generational disruption we’re going through,” he said. “Going through that with a streaming service that’s losing billions of dollars, it’s really, really difficult to go on offense.”
Hours after the worst day in the stock’s short history, the moguls and the actors reached an agreement. The SAG-AFTRA strike would be ending, too. Together, the two strikes, which had shut Hollywood down for months, had saved W.B.D. a lot of money. Wiedenfels told us that the free cash flow from the strike — from basically not making any entertainment for months — will ultimately total nearly $1 billion in pretax cost savings. It was good news, at least for now. But the company still needs to grow, and it still has many billions of dollars in debt to pay down.
Making money by not making entertainment is a short-term proposition at best. Zaslav inherited a pipeline of movies from AT&T but hasn’t yet launched many of his own. With the strikes at an end, Zaslav says he’s excited to get the studio back to work. But it won’t be easy. After the dismal performance of “The Flash,” followed by another DC flop, “Blue Beetle,” it’s fair to wonder if the great comic-book-movie boom might have finally run its course. Live sports remain a strong business, but the rights are getting more expensive all the time, and he’s now competing for them with Amazon and Apple. There’s certainly money to be made in video games — “Hogwarts Legacy,” the company’s popular action role-playing game, has earned more than $1.3 billion since its release in February.
Zaslav has no intention of giving up Jack Warner’s office — and the renovation of Woodland is progressing, if slowly — but he has been spending less time on the studio lot lately and more time at the company’s corporate offices in New York. He has had his ups and downs in Hollywood, but that’s the nature of the business. Someone is always screwing someone or getting screwed by someone. And then they make up and do a movie together. “D.Z. loves running this!” Diller says. “Are you kidding? He’s the happiest clam in the universe.”
The latest earnings aside, Zaslav says he is rebuilding W.B.D. for the long term. “We’ve got great assets here,” he told us. “Great artillery in this incredible fight. And during moments like this, maybe more than any other time, everything is possible. Everything is possible.” One thing that’s possible is that he’ll just flip W.B.D. to its next buyer. Zaslav is only the latest in a long line of moguls from back East to attach their fortunes to the company. Steve Ross, who built Warner into a modern media-and-entertainment conglomerate, was the first and most successful. Others were considerably less so. Before Warner Brothers Discovery, there were Warner Communications, Time Warner, AOL-Time Warner and the AT&T-owned WarnerMedia. The company always seems to be the answer to someone’s problems. “It’s there for the taking,” Diller says. “Whether that will happen depends on whether someone wants to take it. Saudi Arabia? Don’t laugh.”
And yet even if a buyer does come calling, it’s hard to imagine Zaslav willingly ceding control of W.B.D. Media moguls may be boldfaced names, but they are not talent. Zaslav, whose large circle of friends includes plenty of both, understands this distinction. Several years ago, when he was still trying to save Discovery, he had dinner at Jimmy Buffett’s Hamptons home with Richard Plepler, then the head of HBO. “You know, Richard, we have to keep our seats,” he told Plepler afterward. “Jimmy is a legend, but without the jobs, we’re nothing.”
Mark Peterson is a photographer in New York who was awarded a W. Eugene Smith Grant for his work covering white nationalism.
