As chief executive of Gemstar-TV Guide International Inc., Jeff Shell orchestrated an overhaul of the TV Guide Channel, remaking it in the image of rival E! Entertainment by recruiting several of its former executives as well as its red-carpet divas, Joan and Melissa Rivers.
Shell could soon be in a position to oversee the channel he has been emulating. After having cleaned up several financial and legal troubles at Gemstar, Shell will be taking a top job at Comcast Corp., overseeing the cable giant’s growing portfolio of TV channels, several industry sources said.
Executives at Comcast and News Corp., Gemstar’s controlling shareholder, wouldn’t comment Thursday. Shell didn’t return phone calls seeking comment.
The sources said Shell, 39, tendered his resignation Thursday morning at a regularly scheduled Gemstar board meeting. They said Shell’s replacement -- Rich Battista, a senior business development executive at News Corp.'s Fox Entertainment Group -- would be named today.
Battista, 40, would be Gemstar’s third chief executive in three years and is viewed as an unusual choice. Although he has played a strategic role behind the scenes at Fox, he has little experience managing a large workforce and no visibility on Wall Street, where Gemstar’s stock has languished.
The Hollywood-based publisher of TV Guide has undergone management turmoil in part because of a federal investigation into accounting practices before Shell’s arrival in 2002.
Sources said Shell had not yet negotiated a deal with Philadelphia-based Comcast.
The nation’s leading cable provider, Comcast has been looking to control more of the content it distributes to 1 in 4 of all U.S. pay-TV households. Since its failed bid to buy Walt Disney Co. this year, Comcast Chief Executive Brian Roberts has told Wall Street that content creation is a top priority.
Comcast lacks a channel as powerful as ESPN or Fox News, but its stable is growing fast.
In addition to E!, the Golf Channel, G4 and Outdoor Life Network, Comcast has launched a handful of regional sports services using its distribution clout in cities such as Chicago and Sacramento. It recently teamed up with Sony Corp. to acquire Metro-Goldwyn-Mayer Inc. in an effort to snare programming for its video-on-demand services and for launching new channels.
At Comcast, Shell would report to Chief Operating Officer Stephen Burke, with whom he became friendly when the two worked together at Disney in the early 1990s.
A Harvard MBA who was part of Disney’s strategic planning group, Shell moved into an operating role at Fox Entertainment Group, where he was instrumental in building the company’s cable arm. He dramatically expanded the reach of channels such as FX and Fox News and brought National Geographic and Speed into the Fox fold.
News Corp. chief Rupert Murdoch then tapped Shell to turn around Gemstar after ousting the previous chief, Henry Yuen, in a board-level power struggle. An accounting scandal that unfolded during Yuen’s regime decimated News Corp.'s $6-billion investment in the company, which in addition to TV Guide owns patents and electronic TV guide software.
Under Shell, Gemstar restated its financial results three times, reversing revenue by a total of $377 million. In June, the company paid investors $10 million to settle allegations by federal regulators that it overstated revenue.
Sources said Shell decided to leave Gemstar because he had accomplished most of his goals and saw few new opportunities at News Corp. What’s more, Murdoch has not decided what he wants to do with Gemstar, which owns a hodgepodge of unrelated assets with varying prospects.
The TV Guide magazine has seen its circulation decline as consumers have turned to newspapers and on-screen electronic guides for listings. Gemstar faces competition in the electronic-guide business from heavyweights such as Microsoft Corp. And the TV Guide Channel has scant viewership.
By contrast, Shell will probably be the No. 3 executive at Comcast, a company that is poised for growth under Roberts, whose family co-founded the cable giant, and Burke, who manages the cable operations day to day. A top priority for Comcast is to take on Fox and Disney’s ESPN in sports programming.
At Fox, Shell had a hand in managing the company’s regional sports networks.