Shares jump 13% after reorganizing statement

Follows course taken by Comcast's new spin-off business

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Challenges seen in selling debt-laden direct TV networks

(New throughout, includes details, background, remarks from industry insiders and analysts, updates share costs)

By Dawn Chmielewski, Deborah Mary Sophia and Aditya Soni

Dec 12 (Reuters) - Warner Bros Discovery on Thursday chose to separate its decreasing cable businesses such as CNN from streaming and studio operations such as Max, preparing for a prospective sale or spinoff of its TV service as more cable television subscribers cut the cable.

Shares of Warner jumped after the company stated the brand-new structure would be more deal friendly and it anticipated to finish the split by the middle of 2025. Warner shares closed at $12.49, up more than 15%.

Media companies are considering alternatives for fading cable organizations, a long time money cow where revenues are eroding as countless consumers accept streaming video.

Comcast last month revealed strategies to split most of its NBCUniversal cable television networks into a brand-new public company. The brand-new company would be well capitalized and positioned to get other cable television networks if the market combines, one source told Reuters.

Bank of America research analyst Jessica Reif Ehrlich composed that Warner Bros Discovery's cable television service assets are a "very logical partner" for Comcast's brand-new spin-off company.

"We highly believe there is potential for relatively substantial synergies if WBD's direct networks were combined with Comcast SpinCo," wrote Ehrlich, using the market term for traditional television.

"Further, our company believe WBD's standalone streaming and studio properties would be an attractive takeover target."

Under the new structure for Warner Bros Discovery, the cable TV organization including TNT, Animal Planet and CNN will be housed in a system called Global Linear Networks.

Streaming platforms Max and Discovery+ will be under a different division along with film studios, consisting of Warner Bros Pictures and New Line Cinema.

The restructuring shows an inflection point for the media industry, as investments in streaming services such as Warner Bros Discovery's Max are finally paying off.

"Streaming won as a habits," said Jonathan Miller, president of digital media investment firm Integrated Media. "Now, it's winning as a service."

Brightcove CEO Marc DeBevoise stated Warner Bros Discovery's brand-new business structure will separate growing studio and streaming possessions from rewarding however diminishing cable organization, giving a clearer investment image and likely setting the phase for a sale or spin-off of the cable system.

The media veteran and consultant forecasted Paramount and others may take a similar path.

CEO David Zaslav, a veteran deal-maker who led Discovery through its acquisition of Scripps Networks Interactive before getting the even larger target, AT&T's WarnerMedia, is placing the business for its next chess move, composed MoffettNathanson expert Robert Fishman.

"The question is not whether more pieces will be walked around or knocked off the board, or if more consolidation will take place-- it is a matter of who is the purchaser and who is the seller," composed Fishman.

Zaslav signaled that circumstance throughout Warner Bros Discovery's investor call last month. He stated he prepared for President-elect Donald Trump's administration would be friendlier to deal-making, opening the door to media market consolidation.

Zaslav had actually engaged in merger talks with Paramount late in 2015, though a deal never materialized, according to a regulative filing last month.

Others injected a note of caution, noting Warner Bros Discovery brings $40.4 billion in debt.

"The structure modification would make it easier for WBD to offer off its direct TV networks," eMarketer expert Ross Benes said, referring to the cable business. "However, finding a purchaser will be challenging. The networks owe money and have no indications of growth."

In August, Warner Bros Discovery made a note of the value of its TV assets by over $9 billion due to unpredictability around charges from cable and satellite suppliers and sports betting rights renewals.

This week, the media business revealed a multi-year offer increasing the overall fees Comcast will pay to distribute Warner Bros Discovery's networks.

Warner Bros Discovery is sports betting the Comcast arrangement, together with a deal reached this year with cable and broadband provider Charter, will be a template for future settlements with distributors. That could assist stabilize rates for the domestic pay TV market. (Reporting by Deborah Sophia and Aditya Soni in Bengaluru, Dawn Chmielewski in Los Angeles; Editing by Shilpi Majumdar, Arun Koyyur, Keith Weir and David Gregorio)