Warner Bros. Discovery (WBD) 10-Q 3 Nov 09 2009 Q3 Quarterly report Financial data

Document and Company Informatio

Document and Company Information (USD $)
	9 Months Ended Sep. 30, 2009	Jun. 30, 2008	Oct. 26, 2009	Oct. 26, 2009	Oct. 26, 2009
Entity Registrant Name	Discovery Communications, Inc.
Entity Central Index Key	0001437107
Document Type	10-Q
Document Period End Date	2009-09-30
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float		$6,185,001,744
Entity Common Stock, Shares Outstanding			135,154,668	6,598,161	141,711,292

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets (Unaudited) (USD $)
In Millions	Sep. 30, 2009	Dec. 31, 2008
ASSETS
Cash and cash equivalents	$401	$100
Receivables, net of allowances of $16 and $16, respectively	775	780	[1]
Content rights, net	76	73	[1]
Prepaid expenses and other current assets	165	156	[1]
Total current assets	1,417	1,109	[1]
Noncurrent content rights, net	1,225	1,163	[1]
Property and equipment, net	417	395	[1]
Goodwill	6,438	6,891	[1]
Intangible assets, net	654	716	[1]
Other noncurrent assets	590	210	[1]
Total assets	10,741	10,484	[1]
LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS IN SUBSIDIARIES AND EQUITY
Accounts payable and accrued liabilities	394	421	[1]
Current portion of long-term debt	39	458	[1]
Other current liabilities	329	191	[1]
Total current liabilities	762	1,070	[1]
Long-term debt	3,472	3,331	[1]
Other noncurrent liabilities	416	473	[1]
Total liabilities	4,650	4,874	[1]
Commitments and contingencies (Note 18)
Redeemable non-controlling interests in subsidiaries	49	49	[1]
Additional paid-in capital	6,589	6,545	[1]
Accumulated deficit	(531)	(936)	[1]
Accumulated other comprehensive loss	(35)	(78)	[1]
Equity attributable to Discovery Communications, Inc.	6,028	5,536	[1]
Equity attributable to non-controlling interests	14	25	[1]
Total equity	6,042	5,561	[1]
Total liabilities, redeemable non-controlling interests in subsidiaries and equity	10,741	10,484	[1]
Series A common stock:
Commitments and contingencies (Note 18)
Common Stock, value	1	1	[1]
Series B common stock:
Commitments and contingencies (Note 18)
Common Stock, value	0	0	[1]
Series C common stock:
Commitments and contingencies (Note 18)
Common Stock, value	2	2	[1]
Series A preferred stock:
Commitments and contingencies (Note 18)
Preferred stock, value	1	1	[1]
Series C preferred stock:
Commitments and contingencies (Note 18)
Preferred stock, value	$1	$1	[1]
[1]Recast

1_Condensed Consolidated Balanc

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $)
In Millions	Sep. 30, 2009	Dec. 31, 2008
Allowances for receivables	$16	$16
Series A common stock:
Common stock, par value	0.01	0.01
Common stock, shares authorized	1,700	1,700
Common stock, shares issued	135	134
Common stock, shares outstanding	135	134
Series B common stock:
Common stock, par value	0.01	0.01
Common stock, shares authorized	100	100
Common stock, shares issued	7	7
Common stock, shares outstanding	7	7
Series C common stock:
Common stock, par value	0.01	0.01
Common stock, shares authorized	2,000	2,000
Common stock, shares issued	142	141
Common stock, shares outstanding	142	141
Series A preferred stock:
Preferred stock, par value	0.01	0.01
Preferred stock, shares authorized	75	75
Preferred stock, shares issued	71	70
Preferred stock, shares outstanding	71	70
Series C preferred stock:
Preferred stock, par value	0.01	0.01
Preferred stock, shares authorized	75	75
Preferred stock, shares issued	71	70
Preferred stock, shares outstanding	71	70

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) (USD $)
In Millions, except Per Share data	3 Months Ended Sep. 30, 2009	3 Months Ended Sep. 30, 2008		9 Months Ended Sep. 30, 2009	9 Months Ended Sep. 30, 2008
Revenues:
Distribution	$426	$419	[1]	$1,277	$1,239	[1]
Advertising	341	332	[1]	1,010	1,014	[1]
Other	87	94	[1]	265	286	[1]
Total revenues	854	845	[1]	2,552	2,539	[1]
Costs of revenues, excluding depreciation and amortization listed below	257	262	[1]	767	758	[1]
Selling, general and administrative	338	224	[1]	929	845	[1]
Depreciation and amortization	40	50	[1]	118	146	[1]
Restructuring and impairment charges	4	13	[1]	47	17	[1]
Gain on business disposition	0	0	[1]	(252)	0	[1]
Total operating costs and expenses, net	639	549	[1]	1,609	1,766	[1]
Operating income	215	296	[1]	943	773	[1]
Interest expense, net	(66)	(61)	[1]	(183)	(196)	[1]
Other non-operating income (expense), net	6	(8)	[1]	34	(4)	[1]
Income from continuing operations before income taxes	155	227	[1]	794	573	[1]
Provision for income taxes	(54)	(93)	[1]	(391)	(285)	[1]
Income from continuing operations, net of taxes	101	134	[1]	403	288	[1]
Income from discontinued operations, net of taxes	0	40	[1]	0	42	[1]
Net income	101	174	[1]	403	330	[1]
Less net (income) loss attributable to non-controlling interests	0	(40)	[1]	2	(119)	[1]
Net income attributable to Discovery Communications, Inc.	101	134	[1]	405	211	[1]
Stock dividends to preferred interests	(6)	0	[1]	(8)	0	[1]
Net income available to Discovery Communications, Inc. stockholders	95	134	[1]	397	211	[1]
Amounts available to Discovery Communications, Inc. stockholders:
Income from continuing operations, net of taxes	95	94	[1]	397	169	[1]
Income from discontinued operations, net of taxes	0	40	[1]	0	42	[1]
Net income	$95	$134	[1]	$397	$211	[1]
Income per share from continuing operations available to Discovery Communications, Inc. stockholders, basic and diluted	0.22	0.31	[1]	0.94	0.59	[1]
Income per share from discontinued operations available to Discovery Communications, Inc. stockholders, basic and diluted	$0	0.13	[1]	$0	0.15	[1]
Net income per share available to Discovery Communications, Inc. stockholders, basic and diluted	0.22	0.44	[1]	0.94	0.74	[1]
Weighted average number of shares outstanding:
Basic	424	302	[1]	423	287	[1]
Diluted	427	302	[1]	424	287	[1]
[1]Recast

2_Condensed Consolidated Statem

Condensed Consolidated Statements of Cash Flows (Unaudited) (USD $)
In Millions	9 Months Ended Sep. 30, 2009	9 Months Ended Sep. 30, 2008
Operating Activities
Net income	$403	$330	[1]
Adjustments to reconcile net income to cash provided by operating activities:
Share-based compensation expense (benefit)	196	(47)	[1]
Depreciation and amortization	118	195	[1]
Asset impairments	26	0	[1]
Gains on business dispositions	(252)	(67)	[1]
Gains on asset dispositions	0	(9)	[1]
Gain on sale of securities	(13)	0	[1]
Deferred income taxes	(33)	122	[1]
Other noncash expenses, net	26	62	[1]
Changes in operating assets and liabilities, net of discontinued operations:
Receivables, net	0	(29)	[1]
Accounts payable and accrued liabilities	(21)	(18)	[1]
Other, net	(92)	(116)	[1]
Cash provided by operating activities	358	423	[1]
Investing Activities
Purchases of property and equipment	(43)	(84)	[1]
Net cash acquired from Newhouse Transaction	0	45	[1]
Business acquisitions, net of cash acquired	0	(8)	[1]
Proceeds from asset dispositions	0	13	[1]
Proceeds from business dispositions	300	126	[1]
Proceeds from sales of securities	22	24	[1]
Cash provided by investing activities	279	116	[1]
Financing Activities
Ascent Media Corporation spin-off	0	(356)	[1]
Net repayments of revolver loans	(315)	(89)	[1]
Borrowings from long-term debt, net of discount and issuance costs	970	0	[1]
Principal repayments of long-term debt	(1,007)	(191)	[1]
Principal repayments of capital lease obligations	(7)	(12)	[1]
Cash distribution to non-controlling interest	(9)	0	[1]
Proceeds from stock option exercises	26	0	[1]
Other financing activities, net	(1)	(10)	[1]
Cash used in financing activities	(343)	(658)	[1]
Effect of exchange rate changes on cash and cash equivalents	7	2	[1]
Change in cash and cash equivalents	301	(117)	[1]
Cash and cash equivalents, beginning of period	100	209	[1]
Cash and cash equivalents, end of period	$401	$92	[1]
[1]Recast

3_Condensed Consolidated Statem

Condensed Consolidated Statements of Equity (Unaudited) (USD $)
In Millions	3 Months Ended Sep. 30, 2009	3 Months Ended Sep. 30, 2008		9 Months Ended Sep. 30, 2009		9 Months Ended Sep. 30, 2008
Beginning Balance	$5,918	$4,664	[1]	$5,561	[1]	$4,504	[1]
Comprehensive income:
Net income (loss)	101	174	[1]	403		330	[1]
Other comprehensive (loss) income:
Foreign currency translation adjustments, net	(5)	(14)	[1]	24		(10)	[1]
Unrealized (losses) gains on securities and derivative instruments, net	(5)	2	[1]	19		1	[1]
Total comprehensive income (loss)	91	162	[1]	446		321	[1]
Stock dividends declared to preferred interests	(6)	0		(8)		0
Stock dividends paid to preferred interests	7	0		7		0
Cash distribution to non-controlling interest	(1)	0		(9)		0	[1]
Share-based compensation	7	2	[1]	19		3	[1]
Ascent Media Corporation spin-off	0	(708)	[1]	0		(708)	[1]
Issuance of preferred stock	0	98	[1]	0		98	[1]
Reversal of deferred tax liability related to DHC's investment in DCH	0	1,317	[1]	0		1,317	[1]
Issuance of common stock in connection with share-based plans and other	26	0		26		0
Ending Balance	6,042	5,535	[1]	6,042		5,535	[1]
Equity Before Noncontrolling Interests
Beginning Balance	5,903	4,576	[1]	5,536	[1]	4,495	[1]
Comprehensive income:
Net income (loss)	101	134	[1]	405		211	[1]
Other comprehensive (loss) income:
Foreign currency translation adjustments, net	(5)	(14)	[1]	24		(10)	[1]
Unrealized (losses) gains on securities and derivative instruments, net	(5)	2	[1]	19		1	[1]
Total comprehensive income (loss)	91	122	[1]	448		202	[1]
Stock dividends declared to preferred interests	(6)	0		(8)		0
Stock dividends paid to preferred interests	7	0		7		0
Cash distribution to non-controlling interest	0	0		0		0
Share-based compensation	7	2	[1]	19		3	[1]
Ascent Media Corporation spin-off	0	(708)	[1]	0		(708)	[1]
Issuance of preferred stock	0	210	[1]	0		210	[1]
Reversal of deferred tax liability related to DHC's investment in DCH	0	1,317	[1]	0		1,317	[1]
Issuance of common stock in connection with share-based plans and other	26	0		26		0
Ending Balance	6,028	5,519	[1]	6,028		5,519	[1]
Non-controlling Interests
Beginning Balance	15	88	[1]	25	[1]	9	[1]
Comprehensive income:
Net income (loss)	0	40	[1]	(2)		119	[1]
Other comprehensive (loss) income:
Foreign currency translation adjustments, net	0	0	[1]	0		0	[1]
Unrealized (losses) gains on securities and derivative instruments, net	0	0	[1]	0		0	[1]
Total comprehensive income (loss)	0	40	[1]	(2)		119	[1]
Stock dividends declared to preferred interests	0	0		0		0
Stock dividends paid to preferred interests	0	0		0		0
Cash distribution to non-controlling interest	(1)	0		(9)		0
Share-based compensation	0	0	[1]	0		0	[1]
Ascent Media Corporation spin-off	0	0	[1]	0		0	[1]
Issuance of preferred stock	0	(112)	[1]	0		(112)	[1]
Reversal of deferred tax liability related to DHC's investment in DCH	0	0	[1]	0		0	[1]
Issuance of common stock in connection with share-based plans and other	0	0		0		0
Ending Balance	$14	$16	[1]	$14		$16	[1]
[1]Recast

Description of Business and Bas

Description of Business and Basis of Presentation
	9 Months Ended Sep. 30, 2009 USD / shares
Description of Business and Basis of Presentation [Abstract]
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION	1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Description of Business Discovery Communications, Inc. (Discovery or the Company) is a leading global media and entertainment company that provides original and purchased programming across multiple distribution platforms in the United States (U.S.) and approximately 170 other countries, with over 100 television networks offering customized programming in 35 languages. Discovery also develops and sells consumer and educational products and services as well as media sound services in the U.S. and internationally. In addition, the Company owns and operates a diversified portfolio of website properties and other digital services. The Company manages and reports its operations in three segments: U.S. Networks, consisting principally of domestic cable and satellite television network programming, web brands, and other digital services; International Networks, consisting principally of international cable and satellite television network programming; and Commerce, Education, and Other, consisting principally of e-commerce, catalog, sound production, and domestic licensing businesses. Financial information for Discoverys reportable segments is disclosed in Note 19. Discovery was formed in connection with Discovery Holding Company (DHC) and Advance/Newhouse Programming Partnership (Advance/Newhouse) combining their respective ownership interests in Discovery Communications Holding, LLC (DCH) and exchanging those interests with and into Discovery, which was consummated on September17, 2008 (the Newhouse Transaction). Prior to the Newhouse Transaction, DCH was a stand-alone private company, which was owned approximately 66 2/3% by DHC and 33 1/3% by Advance/Newhouse. The Newhouse Transaction was completed as follows: On September17, 2008, DHC completed the spin-off to its shareholders of Ascent Media Corporation (AMC), a subsidiary holding the cash and businesses of DHC, except for certain businesses that provide sound, music, mixing, sound effects, and other related services (Creative Sound Services or CSS) (the AMC spin-off). Such businesses remain with the Company following the completion of the Newhouse Transaction. The AMC spin-off was effected as a distribution by DHC to holders of its SeriesA and Series B common stock. In connection with the AMC spin-off, each holder of DHC SeriesA common stock received 0.05 of a share of AMC SeriesA common stock and each holder of DHC SeriesB common stock received 0.05 of a share of AMC SeriesB common stock. The AMC spin-off did not involve the payment of any consideration by the holders of DHC common stock and was structured as a tax free transaction under Sections 368(a) and 355 of the Internal Revenue Code of 1986, as amended. There was no gain or loss related to the spin-off. Subsequent to the AMC spin-off, the companies no longer have any ownership interests in each other and operate independently. On September17, 2008, immediately following the AMC spin-off, DHC merged with a transitory merger subsidiary of Discovery, with DHC continuing as the surviving entity and as a wholly-owned subsidiary of Discovery. In connection wit

Recently Issued Accounting and

Recently Issued Accounting and Reporting Pronouncements
	9 Months Ended Sep. 30, 2009 USD / shares
Recently Issued Accounting and Reporting Pronouncements [Abstract]
RECENTLY ISSUED ACCOUNTING AND REPORTING PRONOUNCEMENTS	2. RECENTLY ISSUED ACCOUNTING AND REPORTING PRONOUNCEMENTS Accounting and Reporting Pronouncements Adopted The Hierarchy of Generally Accepted Accounting Principles In June2009, the FASB issued a statement that establishes the FASB Accounting Standards Codification (Codification) as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with U.S. GAAP. The statement modified the GAAP hierarchy to include only two levels of GAAP: authoritative and nonauthoritative. All guidance contained in the Codification carries an equal level of authority. The provisions of this statement allow for rules and interpretive releases of the SEC under authority of federal securities laws to also serve as sources of authoritative GAAP for SEC registrants. The provisions became effective for Discovery on September 30, 2009. The only impact to the Companys consolidated financial statements was to revise references to accounting pronouncements from those of the precodification standards to the references used in the codified hierarchy of GAAP. Fair Value Measurements In August2009, the FASB issued Accounting Standards Update (ASU) No.2009-05, Measuring Liabilities at Fair Value (ASU 2009-05), which amends the guidance for measuring the fair value of liabilities included in FASB ASC Topic 820, Fair Value Measurements and Disclosure (ASC 820). The update reinforces that fair value of a liability is the price that would be paid to transfer the liability in an orderly transaction between market participants at the measurement date. Additionally, the update clarifies how the price of an identical or similar debt security that is traded or the price of the liability when it is traded as an asset should be considered in estimating the fair value of the issuers liability and that the reporting entity must consider its own credit risk in measuring the liabilitys fair value. Effective September30, 2009, the Company adopted the provisions of ASU 2009-05 for all liabilities measured at fair value, which are being applied prospectively. The adoption of ASU 2009-05 resulted in changing the priority level of inputs used to measure the fair value of liabilities associated with the Companys deferred compensation plan from Level 2 to Level 1 within the fair value hierarchy in ASC 820. However, this ASU did not change the Companys valuation techniques or impact the amounts or classifications recorded in the Companys condensed consolidated financial statements. In September2006, the FASB issued a statement which establishes the authoritative definition of fair value, sets out a framework for measuring fair value, and expands the required disclosures about fair value measurement. The provisions of the statement related to financial assets and liabilities as well as nonfinancial assets and liabilities carried at fair value on a recurring basis were adopted prospectively on January1, 2008 and did not have a material impact on the Companys consolidated financial statements. In February2008, the FASB delayed the effective date of this statement for non

Variable Interest Entities

Variable Interest Entities
	9 Months Ended Sep. 30, 2009 USD / shares
Variable Interest Entities [Abstract]
VARIABLE INTEREST ENTITIES	3. VARIABLE INTEREST ENTITIES Discovery holds investments in multiple ventures, most of which were determined to be variable interest entities. The following table provides a list of investments in variable interest entities as of September30, 2009 and the method of accounting. Percentage of Accounting Ownership Method Ventures with the British Broadcasting Corporation: JV Programs, LLC 50 % Consolidated Joint Venture Network, LLC (JVN) 50 % Consolidated Animal Planet Europe 50 % Consolidated Animal Planet Latin America 50 % Consolidated PeopleArts Latin America 50 % Consolidated Animal Planet Asia 50 % Consolidated Animal Planet Japan 33 % Consolidated Other ventures: Oprah Winfrey Network 50 % Consolidated DHJV Company LLC (Hasbro Discovery Joint Venture) 50 % Equity Method For consolidated ventures, $2million of net losses generated by the ventures was allocated to other venture partners during the nine months ended September30, 2009. Approximately $9million of net income generated by the consolidated ventures was allocated to other venture partners during the nine months ended September30, 2008. Amounts allocated to other venture partners are recorded in Net (income)loss attributable to non-controlling interests in the Condensed Consolidated Statements of Operations. Ventures with the British Broadcasting Corporation The Company and the British Broadcasting Corporation (BBC) formed several cable and satellite television network ventures, other than JVN, to produce and acquire factual-based content. The JVN venture was formed to provide debt funding to the other ventures. In addition to its own funding requirements, Discovery has assumed the BBCs funding requirements, giving the Company preferential cash distribution for these joint ventures. The equity interests of the ventures owned by the BBC are reported as non-controlling interests. No cumulative operating losses generated by the ventures were allocated to the BBCs non-controlling interests. In accordance with the venture arrangement, no losses can be allocated to the BBC in excess of distributable cash to the BBC for each joint venture. Pursuant to the venture agreements, the BBC has the right to require the Company to purchase the BBCs interests in the PeopleArts Latin America venture and the Animal Planet ventures if certain conditions are not met. Additional information regarding the BBCs put right is disclosed in Note 10. Oprah Winfrey Network Discovery formed a 50-50 joint venture with Oprah Winfrey and Harpo, Inc. (Harpo) to rebrand Discovery Health Channel as OWN: The Oprah Winfrey Network (OWN Network), which was consummated on July23, 2008. Pursuant to the arrangement, Discovery will contribute its interest in the Discovery Health Channel and certain DiscoveryHealth.com content and Harpo will contribute the Oprah.com website (which will serve as the platform for the venture website) and certain Oprah.com content. Discovery and Harpo are required to make these contr

Discontinued Operations

Discontinued Operations
	9 Months Ended Sep. 30, 2009 USD / shares
Discontinued Operations [Abstract]
DISCONTINUED OPERATIONS	4. DISCONTINUED OPERATIONS In September2008, as part of the Newhouse Transaction, DHC completed the spin-off to its shareholders of AMC, a subsidiary holding the cash and businesses of DHC, except for certain businesses that provide sound, music, mixing, sound effects and other related services. The AMC spin-off did not involve the payment of any consideration by the holders of DHC common stock and was structured as a tax free transaction under Sections 368(a) and 355 of the Internal Revenue Code of 1986, as amended. There was no gain or loss related to the spin-off. Subsequent to the AMC spin-off, the companies no longer have any ownership interests in each other and operate independently. In September2008, prior to the Newhouse Transaction, DHC sold its ownership interests in Ascent Media Systems Technology Services, LLC (AMSTS) and Ascent Media CANS (DBA AccentHealth) AccentHealth for approximately $7million and $119million, respectively, in cash. The sale of these companies resulted in pre-tax gains of $3million for AMSTS and $64million for AccentHealth. AMSTS and AccentHealth were components of the AMC business. It was determined that AMSTS and AccentHealth were non-core assets, and the sale of these companies was consistent with DHCs strategy to divest non-core assets. The Company has no continuing involvement in the operations of AMSTS or AccentHealth. In September2008, prior to the Newhouse Transaction, DHC disposed of certain buildings and equipment for approximately $13million in cash. DHC recognized a pre-tax gain of approximately $9 million in connection with the asset disposals. The disposed assets were part of the AMC business. As there is no continuing involvement in the operations of AMC, AMSTS, or AccentHealth, their results of operations and the gains from the business and asset dispositions are presented as Income from discontinued operations, net of taxes in the Condensed Consolidated Statements of Operations for the three and nine months ended September30, 2008. Cash flows from these entities have not been segregated as discontinued operations in the Condensed Consolidated Statements of Cash Flows. The following table presents summary financial information for discontinued operations for the three and nine months ended September30, 2008 (amounts in millions, except per share data): Three Months Ended Nine Months Ended September 30, 2008 September 30, 2008 Revenues $ 134 $ 482 Loss from the operations of discontinued operations before income taxes $ (8 ) $ (6 ) Loss from the operations of discontinued operations, net of taxes $ (7 ) $ (5 ) Gains on dispositions, net of taxes $ 47 $ 47 Income from discontinued operations, net of taxes $ 40 $ 42 Income per share from discontinued operations available to Discovery Communications, Inc. stockholders, basic and diluted $ 0.13 $ 0.15 Weighted average number of shares outstanding, basic and diluted 302 287 No interest expense was allocated to discontinued operations as there was no debt specifically attributable to discontinued op

Fair Value Measurements

Fair Value Measurements
	9 Months Ended Sep. 30, 2009 USD / shares
Fair Value Measurements [Abstract]
FAIR VALUE MEASUREMENTS	5. FAIR VALUE MEASUREMENTS In accordance with ASC 820, a fair value measurement is determined based on the assumptions that a market participant would use in pricing an asset or liability. ASC 820 also established a three-tiered hierarchy that draws a distinction between market participant assumptions based on: (i)observable inputs such as quoted prices in active markets (Level 1), (ii)inputs other than quoted prices in active markets that are observable either directly or indirectly (Level 2), and (iii)unobservable inputs that require the Company to use present value and other valuation techniques in the determination of fair value (Level 3). Assets and Liabilities Measured at Fair Value on a Recurring Basis The following tables present information about assets and liabilities measured at fair value on a recurring basis (in millions). Fair Value Measurements as of September 30, 2009 Using: Quoted Market Significant Prices in Active Other Significant Markets for Observable Unobservable Total Fair Value as of Identical Assets Inputs Inputs September 30, 2009 (Level 1) (Level 2) (Level 3) Assets: Trading securities $ 32 $ 32 $ $ Derivatives (Note 9) 6 6 Liabilities: Derivatives (Note 9) (63 ) (63 ) Deferred compensation plan (32 ) (32 ) HSW International, Inc. liability (4 ) (4 ) Redeemable non-controlling interests in subsidiaries (Note 10) (49 ) (49 ) $ (110 ) $ $ (61 ) $ (49 ) As disclosed in Note 2, the adoption of ASU 2009-05 resulted in changing the priority level of inputs used to measure the fair value of liabilities associated with the Companys deferred compensation plan from Level 2 to Level 1 within the fair value hierarchy in ASC 820 as of September30, 2009. However, this ASU did not change the Companys valuation techniques or impact the amounts or classifications recorded in the Companys consolidated financial statements. Fair Value Measurements as of December 31, 2008 Using: Quoted Market Significant Prices in Active Other Significant Markets for Observable Unobservable Total Fair Value as of Identical Assets Inputs Inputs December 31, 2008 (Level 1) (Level 2) (Level 3) Assets: Trading securities $ 36 $ 36 $ $ Available-for-sale securities 15 15 Liabilities: Derivatives (112 ) (112 ) Deferred compensation plan (36 ) (36 ) HSW International, Inc. liability (7 ) (7 ) Redeemable non-controlling interests in subsidiaries (49 ) (49 ) $ (153

Content Rights

Content Rights
	9 Months Ended Sep. 30, 2009 USD / shares
Content Rights [Abstract]
CONTENT RIGHTS	6. CONTENT RIGHTS The following table presents a summary of the components of content rights (in millions). September 30, December 31, 2009 2008 Produced content rights: Completed $ 1,753 $ 1,420 In-production 219 270 Co-produced content rights: Completed 424 462 In-production 81 63 Licensed content rights: Acquired 279 218 Prepaid 15 17 Content rights, at cost 2,771 2,450 Accumulated amortization (1,470 ) (1,214 ) Content rights, net 1,301 1,236 Less: Current portion 76 73 Noncurrent portion $ 1,225 $ 1,163 For the three and nine months ended September30, 2009, the Company recorded amortization expense related to content rights of $179million and $518million, respectively. Amortization expense related to content rights was $178million and $495million for the three and nine months ended September30, 2008, respectively. Amortization expense was recorded as a component of Costs of revenues in the Condensed Consolidated Statements of Operations. Amortization expense for the three and nine months ended September30, 2009 included charges of $19 million and $45million, respectively, related to the decision not to proceed with certain completed and in-process content at the Companys U.S. Networks and International Networks segments. Amortization expense for the three and nine months ended September30, 2008 included charges of $25million and $40million, respectively, related to the decision not to proceed with certain completed and in-process content at the Companys U.S. Networks and International Networks segments. The charges were the result of management evaluating the Companys programming portfolio assets and concluding that certain programming was no longer aligned with the Companys strategy and would no longer be aired. The Company enters into collaborative co-produced content right arrangements (co-productions) whereby it obtains certain editorial and distribution rights to content assets in return for funding production costs. The Companys level of involvement in co-productions ranges from review of the initial production plan to detailed editorial oversight through each stage of the production process. As the Company shares in the variable risks and rewards of content creation, these co-productions are within the scope of ASC 808. The Company capitalizes the net cost of co-productions and amortizes them in accordance with its content amortization policy. The Companys policy is to record cash receipts for distribution, advertising and royalty revenue that result from the use of co-produced content as gross revenue in accordance with FASB ASC Topic 605, Revenue Recognition (ASC 605) as it relates to reporting revenue gross as a principal versus net as an agent. The Company generally does not allocate revenue to specific content rights, and there were no royalty revenues or expenses associated with co-production partners during the three and nine month periods

Goodwill and Intangible Assets

Goodwill and Intangible Assets
	9 Months Ended Sep. 30, 2009 USD / shares
Goodwill and Intangible Assets [Abstract]
GOODWILL AND INTANGIBLE ASSETS	7. GOODWILL AND INTANGIBLE ASSETS Goodwill The following table presents a summary of the Companys goodwill by reportable segment (in millions). Commerce, U. S. International Education, Networks Networks and Other Total Balance as of December31, 2008 $ 5,569 $ 1,273 $ 49 $ 6,891 Disposition (437 ) (437 ) Purchase accounting adjustment (18 ) (18 ) Foreign currency translation adjustments 2 2 Balance as of September30, 2009 $ 5,114 $ 1,275 $ 49 $ 6,438 Goodwill decreased $453million during the nine months ended September30, 2009. The decrease was primarily attributable to the Discovery Kids disposition and an adjustment to the purchase price for the acquisition of HSW. As disclosed in Note 3, in May2009 Discovery and Hasbro formed a joint venture that will operate a television network and website to deliver childrens and family entertainment and educational programming. In connection with the formation of the joint venture, the Company transferred Discovery Kids to the venture, which was previously a component of the Other U.S. Networks reporting unit. For its contribution, the Company received a 50% ownership interest in the joint venture and Hasbro acquired the remaining 50% ownership interest for $357million. It was determined that Discovery Kids met the definition of a business under ASC 805 and, therefore, the Company allocated $437million of the Other U.S. Networks reporting unit goodwill to Discovery Kids pursuant to ASC 350. The allocation of goodwill was based on the relative fair values of Discovery Kids and the portion of the Other U.S. Networks reporting unit that was retained. During the nine months ended September30, 2009, the Company reversed a deferred tax liability for losses incurred for other than temporary declines during 2008 in the value of the equity investment in HSWI, which resulted in an $18million reduction of goodwill. Intangible Assets The following table presents a list of the gross carrying value of the Companys intangible assets and related accumulated amortization by major category (in millions, except years). Weighted Average September 30, 2009 December 31, 2008 Amortization Period Accumulated Accumulated (Years) Gross Amortization Net Gross Amortization Net Intangible assets subject to amortization: Trademarks 6 $ 33 $ (15 ) $ 18 $ 55 $ (23 ) $ 32 Customer lists 25 528 (62 ) 466 611 (107 ) 504 Other 5 4 (2 ) 2 36 (24 ) 12 Total 565 (79 ) 486 702 (154 ) 548 Intangible assets not subject to amortization: Trademarks 168

Debt

Debt
	9 Months Ended Sep. 30, 2009 USD / shares
Debt [Abstract]
DEBT	8. DEBT The following table presents the components of the Companys outstanding debt by instrument type (in millions). September 30, December 31, 2009 2008 $1.6billion Revolving Credit Facility, due October2010 $ $ 315 $1.0billion Term Loan A, due quarterly December2008 to October2010 938 $1.5billion Term Loan B, due quarterly September2007 to May2014 1,466 1,478 $500million Term Loan C, due quarterly June2009 to May2014 498 7.45% Senior Notes, semi-annual interest, due September2009 55 8.37% Senior Notes, semi-annual interest, due March2011 220 220 8.13% Senior Notes, semi-annual interest, due September2012 235 235 Floating Rate Senior Notes, semi-annual interest, due December2012 (1.99% at September30, 2009 and 3.3% at December31, 2008) 90 90 6.01% Senior Notes, semi-annual interest, due December2015 390 390 5.625% Senior Notes, semi-annual interest, due August2019 500 Other notes payable 1 1 Capital lease obligations 125 67 Total long-term debt 3,525 3,789 Unamortized discount (14 ) Long-term debt, net 3,511 3,789 Less: Current portion 39 458 Noncurrent portion $ 3,472 $ 3,331 Term Loans On May14, 2009, Discovery Communications Holding, LLC (DCH), a wholly-owned subsidiary of the Company, entered into Amendment No.1 (the Amendment) to its Credit, Pledge and Security Agreement dated as of May14, 2007 with Bank of America, N.A. (as administrative agent and a lender) and the other lenders named therein (Term Loan B). The Amendment revises Term Loan B to permit any indebtedness otherwise permitted to be incurred by any restricted subsidiary, as defined in Term Loan B, or DCH to contain restrictions similar to provisions in DCHs and its subsidiaries existing credit facility and privately placed notes, subject to certain conditions. These provisions include restrictions on limitations on guarantees, liens and restricted payments. Term Loan B was further amended in order to eliminate DCHs obligation to give existing lenders ten business days to commit to any additional term facility. On May14, 2009, DCH entered into Credit Agreement Supplement No.1 (Term Loan C) to its Term Loan B with Bank of America N.A. (as administrative agent and lender). Pursuant to Term Loan C, DCH incurred $500million of indebtedness, which matures on May14, 2014. DCH received net proceeds of $478million from the borrowing after deducting issuance expenses of $12million recorded as a discount and $10million of expenses recorded as deferred financing costs. DCH used the net proceeds of the borrowing to repay $163million and $315million of indebtedness outstanding under DCLs Term Loan A and the revolving credit facility, respectively. The Term Loan C indebtedness is repayable in equal quarterly installments of $1.25million beginning June30, 2009 through March31, 2014, with the balance due on the maturity date. Term Loan C bears interest at an i

Derivative Financial Instrument

Derivative Financial Instruments
	9 Months Ended Sep. 30, 2009 USD / shares
Derivative Financial Instruments [Abstract]
DERIVATIVE FINANCIAL INSTRUMENTS	9. DERIVATIVE FINANCIAL INSTRUMENTS The Company uses derivative financial instruments principally to modify its exposure to market risks from changes in interest rates. The Company does not hold or enter into financial instruments for speculative trading purposes. The Companys interest expense is exposed to movements in short-term interest rates. Derivative instruments, including both fixed to variable and variable to fixed interest rate swaps, are used to modify this exposure. The majority of the Companys debt is variable rate and the Company uses derivatives to effectively fix the amount of interest paid. The variable to fixed interest rate instruments are based on the three-month LIBOR rate and have a total notional amount of $2.2billion and a weighted average interest rate of 4.68% at September30, 2009. The fixed to variable interest rate agreements have a total notional amount of $50million and a weighted average interest rate of 4.67% at September30, 2009. In addition, the Company has forward starting variable to fixed interest rate instruments with a total notional amount of $860million and a weighted average interest rate of 2.60% at September30, 2009, of which a notional amount of $560 million will become effective in December2009 and a notional amount of $300million will become effective in June2010. During the nine months ended September30, 2009, the Company has entered into forward starting interest rate swaps with a total notional amount of $300million, starting June30, 2010 and maturing on March31, 2014. The swaps have a weighted average fixed pay rate of 2.90%, and the Company is required to make payments at the three-month LIBOR rate. During the nine months ended September30, 2009, the Company has terminated interest rate swaps with a total notional amount of $75million and a net fair value in a loss position of $1million. Of the Companys total notional amount of $3.1billion in interest rate derivatives, a notional amount of $2.3billion of these derivative instruments are highly effective cash flow hedges as of September30, 2009. The change in the fair value of derivatives designated as hedging instruments is reported as a component of Accumulated other comprehensive loss on the Condensed Consolidated Balance Sheets. Should any portion of these instruments become ineffective due to a restructuring in the Companys debt, the cumulative fair value, which is currently a net loss of $35million, would be reclassified from Accumulated other comprehensive loss on the Condensed Consolidated Balance Sheets to Other non-operating income (expense), net on the Condensed Consolidated Statements of Operations. In addition, subsequent monthly changes in fair value would be reported as a component of Other non-operating income (expense), net on the Condensed Consolidated Statements of Operations. The Company does not expect material hedge ineffectiveness in the next twelve months. The remaining $810million in interest rate derivatives have not been designated for hedge accounting under ASC 815. The change in the fair value of derivatives not designated as hedging instruments is reported as a component of Other non-operatin

Redeemable Non Controlling Inte

Redeemable Non Controlling Interests in Subsidiaries
	9 Months Ended Sep. 30, 2009 USD / shares
Redeemable Non-Controlling Interests in Subsidiaries [Abstract]
REDEEMABLE NON-CONTROLLING INTERESTS IN SUBSIDIARIES	10. REDEEMABLE NON-CONTROLLING INTERESTS IN SUBSIDIARIES PeopleArts Latin America and Animal Planet Channel Group As disclosed in Note 3, Discovery and the BBC have formed several cable and satellite television network joint ventures to develop and distribute programming content. Under certain terms outlined in the contract, the BBC has the right every three years, commencing December31, 2002, to put to the Company its interests in (i)PeopleArts Latin America, and/or (ii)certain Animal Planet channels outside of the U.S. (the Channel Groups), in each case for a value determined by a specified formula. In January2009, the BBC requested that a determination be made whether such conditions have occurred with respect to both Channel Groups as of December31, 2008. The contractual redemption value is based upon the exercise of the BBC put right and an estimate of the proceeds from a hypothetical sale of the Channel Groups and a distribution of the proceeds to the venture partners based on various rights and preferences. As the Company has funded all operations from inception of the ventures through December31, 2008, the Company believes that it has accumulated rights and preferences in excess of the fair market value of the Channel Groups. However, due to the complexities of the redemption formula, the Company has accrued the non-controlling redeemable interests to an estimated negotiated value of $49million as of both September30, 2009 and December31, 2008. Changes in the assumptions used to estimate the redemption value could materially impact current estimates. The Company recorded no accretion to the redemption value during the three and nine months ended September30, 2009 and 2008. The Company and the BBC are currently discussing potential revisions to all of their contractual relationships, including the ownership interests in the Channel Groups. While there can be no assurance that these or other negotiations would result in an definitive agreement, the Company expects that the cost of a negotiated acquisition of the BBCs interests in the Channel Groups could substantially exceed the value of the put right described above. OWN Network As disclosed in Note 3, Discovery and Harpo formed a venture to rebrand Discovery Health Channel as OWN: The Oprah Winfrey Network. Pursuant to the venture agreement, Discovery provided a put right to Harpo which is exercisable on four separate put exercise dates within 12.5years of the ventures formation date. The put arrangement provides Harpo with the right to require Discovery to purchase its 50% ownership interest at fair market value up to a maximum put amount. The maximum put amount ranges between $100million on the first put exercise date up to $400 million on the fourth put exercise date. As of September30, 2009, no amounts have been recorded for this put right as the Company has not yet contributed its interest in Discovery Health Channel and Harpo has not yet contributed the Oprah.com website to the OWN Network venture.

Other Comprehensive Income

Other Comprehensive Income (Loss)
	9 Months Ended Sep. 30, 2009 USD / shares
Other Comprehensive Income (Loss) [Abstract]
OTHER COMPREHENSIVE INCOME (LOSS)	11. OTHER COMPREHENSIVE INCOME (LOSS) The following tables summarize the tax effects related to each component of Other comprehensive income (loss) (in millions). Three Months Ended Three Months Ended September 30, 2009 September 30, 2008 Before-tax Net-of-tax Before-tax Tax Benefit Net-of-tax Amount Tax Benefit Amount Amount (Expense) Amount Foreign currency translation adjustments $ (7 ) $ 2 $ (5 ) $ (23 ) $ 9 $ (14 ) Unrealized (losses) gains on securities and derivative instruments, net (7 ) 2 (5 ) 5 (3 ) 2 Other comprehensive (loss) income $ (14 ) $ 4 $ (10 ) $ (18 ) $ 6 $ (12 ) Nine Months Ended Nine Months Ended September 30, 2009 September 30, 2008 Before-tax Net-of-tax Before-tax Tax Benefit Net-of-tax Amount Tax Benefit Amount Amount (Expense) Amount Foreign currency translation adjustments $ 38 $ (14 ) $ 24 $ (17 ) $ 7 $ (10 ) Unrealized gains (losses)on securities and derivative instruments, net 30 (11 ) 19 3 (2 ) 1 Other comprehensive income (loss) $ 68 $ (25 ) $ 43 $ (14 ) $ 5 $ (9 )

Share Based Compensation

Share Based Compensation
	9 Months Ended Sep. 30, 2009 USD / shares
Share-Based Compensation [Abstract]
SHARE-BASED COMPENSATION	12. SHARE-BASED COMPENSATION The Company has various plans it assumed from DHC and DCH in connection with the Newhouse Transaction. Under these plans the Company is authorized to grant share-based awards to employees and nonemployees. Prior to September18, 2008, DCH maintained the Discovery Appreciation Plan (the DAP Plan) and the HowStuffWorks.com Plan (the HSW Plan). The DAP Plan is a long-term incentive plan under which eligible employees received cash settled unit awards. The HSW Plan is a long-term incentive plan assumed with the acquisition of HSW for the benefit of the subsidiarys employees. The DAP Plan and the HSW Plan continue to exist subsequent to the Newhouse Transaction. Prior to September18, 2008, DHC maintained the Discovery Holding Company 2005 Incentive Plan, the Discovery Holding Company 2005 Non-Employee Director Incentive Plan (collectively the Incentive Plans), and the Discovery Holding Company Transitional Stock Adjustment Plan (the Transitional Plan). There are outstanding awards under the Transitional Plan, but the Company has no ability to issue new awards under this plan. The Company grants awards to its employees and non-employee directors under the Incentive Plans, which may include stock options, restricted shares, restricted stock units, stock appreciation rights (SARs), and cash awards that are subject to the provisions of FASB ASC Topic 718, Stock Compensation (ASC 718). Most awards previously granted by DHC under these plans that were outstanding at the time of the Newhouse Transaction were fully vested and were converted into securities of Discovery in connection with the Newhouse Transaction. The Incentive Plans and the Transitional Plan continue to exist subsequent to the Newhouse Transaction. DAP Plan The DAP Plan awards consist of a number of units which represent an equivalent number of shares of common stock with a base price established by the Company. Although the DAP Plan was a DCH plan through September17, 2008, the value of the unit awards was based on the price of DHCs SeriesA common stock. As the unit awards were indexed to the stock of another entity, DCH accounted for the unit awards as derivatives pursuant to ASC 815. Accordingly, DCH remeasured the fair value of outstanding unit awards each reporting period until settlement. Compensation expense, including the change in fair value, was attributed using the straight-line method during the vesting period. Changes in the fair value of the unit awards that occurred subsequent to the vesting period were recorded as adjustments to compensation costs in the period in which the change occurred. In connection with the Newhouse Transaction, effective September18, 2008, the DAP Plan was amended such that outstanding unit awards and new unit awards granted under that plan are based on Discoverys SeriesA common stock. Accordingly, beginning on September18, 2008, outstanding unit awards and new unit awards granted under the DAP Plan have been accounted for pursuant to the provisions of ASC 718. Because the unit awards are cash settled they are considered liability instruments under ASC 718. Therefore, the Company continues to remea

Exit and Restructuring Charges

Exit and Restructuring Charges
	9 Months Ended Sep. 30, 2009 USD / shares
Exit and Restructuring Charges [Abstract]
EXIT AND RESTRUCTURING CHARGES	13. EXIT AND RESTRUCTURING CHARGES The following table presents a summary of the Companys exit and restructuring charges expensed, by segment, for the three and nine months ended September30, 2008 and 2009 (in millions). Three Months Ended Nine Months Ended September 30, September 30, 2009 2008 2009 2008 U.S. Networks $ 1 $ 13 $ 8 $ 13 International Networks 3 7 Commerce, Education, and Other 1 4 Corporate 5 Total exit and restructuring charges $ 4 $ 13 $ 21 $ 17 The following table presents a summary of changes in the Companys liabilities with respect to exit and restructuring charges during the three and nine months ended September30, 2009 (in millions). Employee Contract Relocations/ Termination Costs Terminations Total Liabilities as of December31, 2008 $ 6 $ 18 $ 24 Net accruals 3 3 Cash paid (1 ) (10 ) (11 ) Liabilities as of March31, 2009 $ 5 $ 11 $ 16 Net accruals 2 12 14 Cash paid (1 ) (6 ) (7 ) Liabilities as of June30, 2009 $ 6 $ 17 $ 23 Net accruals 4 4 Cash paid (1 ) (7 ) (8 ) Liabilities as of September30, 2009 $ 5 $ 14 $ 19 The Company reorganized portions of its operations to better align its organizational structure with the Companys strategic priorities and to reduce its cost structure, which resulted in exit and restructuring charges primarily for changes in management structure and employee terminations. As of September30, 2009, exit and restructuring related accruals expected to be paid within one year totaling $17million were classified as a component of Accounts payable and accrued liabilities in the Condensed Consolidated Balance Sheets. The Company does not expect to incur a significant amount of additional costs with respect to these particular activities.

Income Taxes

Income Taxes
	9 Months Ended Sep. 30, 2009 USD / shares
Income Taxes [Abstract]
INCOME TAXES	14. INCOME TAXES The provisions for income taxes were $54million and $391million for the three and nine months ended September30, 2009, respectively, and $93million and $285million for the three and nine months ended September30, 2008, respectively. The effective tax rates were 35% and 49% for the three and nine months ended September30, 2009, respectively, and 41% and 50% for the three and nine months ended September30, 2008, respectively. The effective tax rate for the nine months ended September30, 2009 differed from the federal statutory rate of 35% due primarily to the permanent difference on the $125million gain from the sale of 50% of the Companys ownership interest in Discovery Kids and the $127million gain as a result of stepping up the Companys basis for the 50% retained interest in Discovery Kids in May2009, and to a lesser extent state income taxes. Discovery did not record a deferred tax liability of $48million with respect to the portion of the outside basis in the Hasbro-Discovery venture attributable to nondeductible goodwill. The effective tax rate for the three and nine months ended September30, 2008 differed from the federal statutory rate of 35% principally due to the presentation of the Newhouse Transaction as though it was consummated on January1, 2008 in accordance with ASC 810. Accordingly, Discoverys condensed consolidated financial statements and notes include the gross combined financial results of both DHC and DCH since January1, 2008. Prior to the Newhouse Transaction on September17, 2008, DHC owned 66 2/3% of DCH and, therefore, recognized a portion of DCHs operating results. As a result, the tax provision for the three and nine months ended September30, 2008 includes the taxes recognized by both DCH and DHC related to the portion of DCHs operating results recognized by DHC. DHC recognized $33million and $85million of deferred tax expense related to its investment in DCH prior to the Newhouse Transaction for the three and nine months ended September30, 2008, respectively. The provision for income taxes for the three and nine months ended September30, 2008 was partially offset by the release of an $18million valuation allowance for deferred tax assets of CSS and the release of a $10million valuation allowance for deferred tax assets related to net operating loss carry-forwards for AMC. During 2009, the Company reclassified $68million of deferred tax liabilities to U.S. federal and state taxes payable in order to recapture certain accelerated tax deductions claimed in 2004 through 2008 related to program content that the Company determined would not qualify as accelerated deductions. As a result of the disallowance of these accelerated deductions, the Company incurred interest of $3million. In June2009, Discovery also recorded a tax expense of approximately $4million related to the reversal of accelerated deductions taken on programs that were disposed of by the Company. There have been no significant changes to the Companys reserves for uncertain tax positions since December31, 2008.

Net Income Per Share Attributab

Net Income Per Share Attributable to Discovery Communications, Inc. Stockholders
	9 Months Ended Sep. 30, 2009 USD / shares
Net Income Per Share Attributable to Discovery Communications, Inc. Stockholders [Abstract]
NET INCOME PER SHARE ATTRIBUTABLE TO DISCOVERY COMMUNICATIONS, INC. STOCKHOLDERS	15. NET INCOME PER SHARE ATTRIBUTABLE TO DISCOVERY COMMUNICATIONS, INC. STOCKHOLDERS Basic net income per share is computed by dividing net income available to Discovery Communications, Inc. stockholders by the weighted average number of shares outstanding during the period. The weighted average number of shares outstanding for the three and nine months ended September30, 2009 and 2008 includes Discoverys SeriesA, B, and C common shares, as well as Discoverys SeriesA and C convertible preferred shares. All series of our common and preferred shares are included in the weighted average number of shares outstanding when calculating both basic and diluted income per share as the holder of each common and preferred series legally participate equally in any per share distributions whether through dividends or in liquidation. The following table presents a reconciliation of the weighted average number of shares outstanding between basic and diluted net income per share. Three Months Ended Nine Months Ended September 30, September 30, 2009 2008 2009 2008 Weighted average number of shares outstanding basic 424 302 423 287 Dilutive effect of equity awards 3 1 Weighted average number of shares outstanding diluted 427 302 424 287 Diluted net income per share adjusts basic net income per share for the dilutive effects of stock options, restricted stock units, and stock settled stock appreciation rights, only in the periods in which such effect is dilutive. For both the three and nine months ended September30, 2008, options to purchase two million common shares were excluded from the calculation of diluted net income per share because their inclusion would have been anti-dilutive. Additionally, the net income per share calculations for the three and nine months ended September30, 2009 and 2008 exclude approximately one million of contingently issuable preferred shares placed in escrow for which specific conditions have not yet been met.

Additional Financial Informatio

Additional Financial Information
	9 Months Ended Sep. 30, 2009 USD / shares
Additional Financial Information [Abstract]
ADDITIONAL FINANCIAL INFORMATION	16. ADDITIONAL FINANCIAL INFORMATION Cash Flows The following tables present a summary of certain cash payments made and received as well as certain noncash transactions (in millions). Three Months Ended Nine Months Ended September 30, September 30, 2009 2008 2009 2008 Cash payments made for interest expense $ 67 $ 63 $ 185 $ 201 Cash payments received for interest income (1 ) Cash interest payments, net $ 67 $ 63 $ 185 $ 200 Cash payments made for income taxes $ 273 $ 41 $ 362 $ 161 Cash payments received for income tax refunds (17 ) Cash tax payments, net $ 273 $ 41 $ 362 $ 144 Non cash transactions: Capital leases $ 29 $ 17 $ 61 $ 63 Stock dividends to preferred interests $ 6 $ $ 8 $ Other Non-Operating Income (Expense), Net The following table presents a summary of the components of Other non-operating income (expense), net (in millions). Three Months Ended Nine Months Ended September 30, September 30, 2009 2008 2009 2008 Equity in earnings (losses)of unconsolidated affiliates $ 2 $ (1 ) $ 5 $ (2 ) Unrealized gains (losses)on derivative instruments, net 4 (4 ) 19 (2 ) Realized losseson derivative instruments, net (2 ) (6 ) (2 ) Realized (losses) gains on securities (1 ) 13 2 Other, net 3 Total other non-operating income (expense), net $ 6 $ (8 ) $ 34 $ (4 ) In May2009, the Company sold securities for $22million, which resulted in a pretax gain of $13million. Approximately $6million of unrealized pretax gains were reclassified from Other comprehensive income. During the nine months ended September30, 2008, AMC, which is reported as discontinued operations, sold securities for $24million. There was no gain associated with this sale. During the three and nine months ended September30, 2008, other-than-temporary impairments charges of $8million and $16million respectively, related to the investment in HSWI were recorded.

Related Party Transactions

Related Party Transactions
	9 Months Ended Sep. 30, 2009 USD / shares
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	17. RELATED PARTY TRANSACTIONS The Company identifies related parties as investors in its consolidated subsidiaries, entities in which the Companys has an investment accounted for using the equity method, and the Companys executive management and directors and their respective affiliates. Transactions with related parties typically result from distribution of networks, mainly with the Discovery Japan, Inc. and Discovery Channel Canada joint ventures, production of content primarily with BBC affiliates, and services involving satellite uplink, systems integration, origination and post-production. The following table presents a summary of balances related to transactions with related parties during the three and nine months ended September30, 2009 and 2008 (in millions). Three Months Ended Nine Months Ended September 30, September 30, 2009 2008 2009 2008 Revenues $ 6 $ 6 $ 18 $ 19 Operating costs and expenses $ 3 $ 19 $ 13 $ 52 Revenues for the three and nine months ended September30, 2008 exclude $15million and $37 million, respectively, for related party transactions that were recorded by AMC, which was spun-off effective January1, 2008. Operating costs and expenses for the three and nine months ended September30, 2008 include disbursements of $14million and $39million, respectively, to an entity that is no longer a related party following the Newhouse Transaction. The following table presents a summary of outstanding balances from transactions with related parties as of September30, 2009 and December31, 2008 (in millions). September 30, December 31, 2009 2008 Accounts receivable $ 5 $ 12

Commitments and Contingencies

Commitments and Contingencies
	9 Months Ended Sep. 30, 2009 USD / shares
Commitments and Contingencies [Abstract]
COMMITMENTS AND CONTINGENCIES	18. COMMITMENTS AND CONTINGENCIES As more fully described in the Companys 2008 revised consolidated financial statements in the Current Report on Form 8-K filed with the SEC on June16, 2009, the Company and its subsidiaries lease offices, satellite transponders, and certain equipment under capital and operating lease arrangements. The Company has several investments in joint ventures. From time to time the Company agrees to fund the operations of the ventures on an as needed basis. The Company has long-term noncancelable lease commitments for office space and equipment, studio facilities, transponders, vehicles and operating equipment. Content commitments of the Company not recorded on the balance sheet include obligations relating to programming development, programming production and programming acquisitions and talent contracts. Other commitments include obligations to purchase goods and services, employment contracts, sponsorship agreements and transmission services. A majority of such fees are payable over several years, as part of the normal course of business. In December2007, Discovery acquired HSW and a 49.5% interest in HSWI. Pursuant to the terms of the arrangement, Discovery has agreed to either: (i)distribute the HSWI stock to the former HSW shareholders, or (ii)sell the HSWI stock and distribute substantially all proceeds in excess of $0.37 per share to the former HSW shareholders. Discovery continues to record a liability of $4 million as of September30, 2009 for its estimated obligation with respect to the HSWI shares to the former HSW shareholders. Pursuant to the OWN venture agreement, Discovery is committed to loan up to $100million to the venture through September30, 2011 to fund operations, of which $27million has been funded through September30, 2009. To the extent funding the joint venture in excess of $100million is necessary, the Company may provide additional funds through a member loan or require the venture to seek third party financing. Discovery expects to recoup the entire amount contributed in future periods provided that the joint venture is profitable and has sufficient funds to repay the Company. In connection with the Newhouse Transaction, DHCs outstanding stock options were converted into stock options or stock settled stock appreciation rights of Discovery, in accordance with the terms of the agreements governing the Newhouse Transaction. Additionally, Advance/Newhouse received shares of Discoverys SeriesA and SeriesC convertible preferred stock. In the event that the stock options or stock settled appreciation rights that were converted in connection with the Newhouse Transaction are exercised, Advance/Newhouse is entitled to receive additional shares of the same series of convertible preferred stock. The Company placed approximately 1.6million shares of preferred stock into an escrow account for this anti-dilution provision. Shares released from escrow to Advance/Newhouse are accounted for as a dividend measured at the fair value of the underlying shares as of the Newhouse Transaction date. During the three and nine months ended September30, 2009, the Company recognized $6million an

Reportable Segments Information

Reportable Segments Information
	9 Months Ended Sep. 30, 2009 USD / shares
Reportable Segments Information [Abstract]
REPORTABLE SEGMENTS INFORMATION	19. REPORTABLE SEGMENTS INFORMATION The Company has three reportable segments: U.S. Networks, consisting principally of domestic cable and satellite television network programming, web brands, and other digital services; International Networks, consisting principally of international cable and satellite television network programming; and Commerce, Education, and Other, consisting principally of e-commerce, catalog, sound production, and domestic licensing businesses. Prior to the Newhouse Transaction and related AMC spin-off (refer to Note 1), DHC had three reportable segments: Creative Services Group, which provided various technical and creative services necessary to complete principal photography into final products such as films, trailers, shows, and other media; Network Services Group, which provided the facilities and services necessary to assemble and distribute programming content for cable and broadcast networks; and DCH, as a significant equity method investee. In connection with the Newhouse Transaction, DHC spun-off its interest in AMC, which included the Creative Services Group segment, except for CSS, and the Network Services Group segment. The discontinued operations of the Creative Services Group and Network Services Group segments have been excluded from the reportable segment information presented below. The CSS business, which remained with Discovery subsequent to the Newhouse Transaction and AMC spin-off, is included in the Commerce, Education, and Other segment. In accordance with ASC 810, the financial results of both DHC and DCH have been combined in Discoverys financial statements as if the Newhouse Transaction occurred January1, 2008. Accordingly, the Commerce, Education, and Other segment information for September30, 2008 includes amounts for CSS since January1, 2008. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies, except that certain inter-segment transactions that are eliminated at the consolidated level are not eliminated at the segment level as they are treated similar to third-party sales transactions in determining segment performance. Inter-segment transactions primarily include the purchase of advertising and content between segments. Inter-segment transactions are not material to the periods presented. The Company evaluates the operating performance of its segments based on financial measures such as revenues and adjusted operating income before depreciation and amortization (Adjusted OIBDA). Adjusted OIBDA is defined as revenues less costs of revenues and selling, general and administrative expenses excluding: (i)mark-to-market share-based compensation, (ii) depreciation and amortization, (iii)amortization of deferred launch incentives, (iv)exit and restructuring charges, (v)impairment charges, and (vi)gains (losses)on business and asset dispositions. The Company uses this measure to assess operating results and performance of its segments, perform analytical comparisons, identify strategies to improve performance and allocate resources to each segment. The Company believes Adjusted OIBDA is relevant to i

Condensed Consolidating Financi

Condensed Consolidating Financial Information
	9 Months Ended Sep. 30, 2009 USD / shares
Condensed Consolidating Financial Information [Abstract]
CONDENSED CONSOLIDATING FINANCIAL INFORMATION	20. CONDENSED CONSOLIDATING FINANCIAL INFORMATION On August12, 2009, Discovery Communications, LLC (DCL) issued debt securities that are fully and unconditionally guaranteed by the Company. The securities were issued under a Registration Statement on Form S-3 with the SEC (the shelf registration) to register certain securities, including debt securities of DCL and DCH that may be issued in the future with full and unconditional guarantees by the Company. DCL or DCH may in the future issue additional securities that are fully and unconditionally guaranteed by the Company under the shelf registration. Accordingly, set forth below is condensed consolidating financial information presenting the financial position, results of operations, and cash flows of (i)the Company, (ii)DCL, (iii)DCH, (iv)non-guarantor subsidiaries of DCL on a combined basis, (v)other non-guarantor subsidiaries of the Company on a combined basis, and (vi)the eliminations and reclassifications necessary to arrive at the information for the Company on a consolidated basis. DCL and the non-guarantor subsidiaries of DCL are the primary operating subsidiaries of the Company. DCLs primary operations are the Discovery Channel and TLC in the U.S. The non-guarantor subsidiaries of DCL include most of the other U.S. networks and the international networks along with the commerce and education businesses. The non-guarantor subsidiaries of DCL are wholly owned subsidiaries of DCL with the exception of certain joint ventures and equity method investments. DCL is a wholly owned subsidiary of DCH. The Company wholly owns DCH through a 33 1/3% direct ownership interest and a 66 2/3% ownership interest through DHC. DHC is included in other non-guarantor subsidiaries of the Company. CSS is a wholly owned subsidiary of DHC. Prior to the Newhouse Transaction, Advance/Newhouse owned 33 1/3% of DCH which is reported as a reduction of DHCs Equity in earnings of subsidiaries in the Condensed Consolidating Statements of Operations for the three and nine months ended September30, 2008. The supplemental condensed consolidating financial information should be read in conjunction with the consolidated financial statements of the Company. The existing indebtedness of DCL and DCH comprises substantially all of the indebtedness of the Company. The financial covenants of the respective debt agreements limit DCL and DCH from making distributions to the Company. The terms of DCLs private senior notes restrict the cumulative payment of dividends over the life of the senior notes to an amount calculated based on the cumulative equity contributions and net income of DCL less the cumulative distributions to DCLs owners. In addition, the terms of the DCHs Term Loan B and Term Loan C allow DCH to pay dividends to the Company to the extent that DCHs leverage ratio does not exceed 5 to 1 based upon defined measures of cash flows and indebtedness. Basis of Presentation In accordance with the rules and regulations of the SEC, the equity method has been applied to (i)the Companys interest in DCH and other non-guarantor subsidiaries, (ii)DCHs interest in DCL, and (iii)DCLs interest in non-