Battle for No. 3 Streaming Service Behind Netflix, Disney Begins – Analysts
By 2024, Netflix Inc. and The Walt Disney Co. are expected to be neck and neck for leading the global streaming market. But who will claim the No. 3 spot?
During a Feb. 11 earnings call, Disney executives reported that Disney+, Hulu LLC and ESPN+ had a collective 146.4 million subscribers around the globe at the close of Disney's first fiscal 2021 quarter, ended Jan. 2. That is up from the 137 million direct-to-consumer subscribers the company reported at its Dec. 10, 2020, investor day, when Disney boosted guidance for the platforms to between 300 million and 350 million combined worldwide customers by the end of its fiscal 2024.
At that point, analysts widely believe Disney's DTC sub base could exceed Netflix, which added 8.5 million net additions in the fourth quarter to finish 2020 with 203.7 million global members. But while Disney and Netflix will be jostling for No. 1, the field is a bit more open when it comes to the future No. 3 seat.
With Andy Jassy, CEO of Amazon Web Services Inc., poised to succeed Amazon founder Jeff Bezos as CEO in the third quarter, Wall Street is wondering about the company's continued commitment to original series and film production, and if it might pursue more live sports rights, including a larger NFL package.
The analysts, meanwhile, are convinced that the streaming services from the other media conglomerates will fashion a solid second tier over the next few years.
'The Office' Driving Up Engagement with NBCU's Peacock Streaming Service
"Superfans" of sitcom "The Office" and related key collections are driving engagement with NBCUniversal Media LLC's streaming service Peacock.Read the Full Article
Quibi's $2 Billion Bet on Mobile Video Fizzles Out
Quibi's bold bet to take a quick bite out of the subscription video market quickly fizzled out as the service lasted less than a year before going dark in December 2020.Read the Full Article
HBO Max May Struggle to Charge a Premium Throughout Europe – Experts
As AT&T Inc.'s WarnerMedia gears up for the worldwide rollout of its streaming service, HBO Max, analysts warned that in Europe, the company faces an uphill battle when it comes to pricing and customer acquisition.Read the Full Article
Streaming Surge Prompts Video DSP Vendors to Pivot to CTV
The rise in video streaming during the pandemic has created many advertising opportunities in the connected TV channel.Read the Full Article
Broadcast Deal Market Recap 2020 – Relatively Good Results in a Challenging Year
The year 2020 was a difficult year for the deal market even before the outbreak of the COVID-19 pandemic. Financing had been hard to come by for a number of years, resulting in low cash flow multiples and a shift of focus to smaller stations in small and non-rated markets.
Under these circumstances, a total deal volume of over a billion dollars ($1,007.07 million to be precise) is quite an accomplishment. It is significantly lower than the 2019 volume but still higher than the volume of 2010, when the deal market felt the full impact of the 2008-2010 financial crisis. The largest transaction of the year took place in September, when E.W. Scripps Co. announced the purchase of all assets of ION Media for $2.65 billion total. For ION’s 71 TV stations, we estimated an 8.7x forward seller’s multiple, which led to a station value of $337.963 million. Another $30 million were added to the deal market in October, when 23 if the ION stations were spun off to newly founded INYO Broadcast Holdings, LLC for $30 million.
Netflix Defies Wall Street Skeptics with Membership Beat, Improved Cash Flow
Netflix Inc.'s stock soared Jan. 20 as Wall Street reconsidered whether the bear case on the company's outlook was dead following a fourth-quarter 2020 earnings report that beat expectations on key membership and cash flow metrics.Read the Full Article
2020 Results Illustrate Roku's Budding Potential in 2nd-tier Streaming Market
Roku Inc. delivered a massive earnings beat as it swung to profit in the fourth quarter 2020 and continued to benefit from pandemic impacts that could boost its standing into the upper echelons of the so-called streaming wars.Read the Full Article
Domestic Box Office Plummets 80% in 2020
The year 2020 turned out to be a down year like no other at the box office. It started out with promise, with weekly box office growing in six out of the first nine weeks of the year. In week 10, the rumblings of the COVID-19 pandemic reaching U.S. shores began, and weekly box office declined 45.3%. In week 11, box office fell 57.5% and was under $100 million for the first time since week 50 in 2011. By week 12, nearly all theaters across the country had closed their doors as the nation went into lockdown.
COVID-19 decimated the 2020 box office year as total box office dropped 80.6% from nearly $11.23 billion in 2019 to $2.18 billion. Admissions also plummeted in 2020, down 80.7% to 236.9 million from nearly 1.23 billion in 2019.
APAC Box Office Revenue, Film Releases Show Signs of Pandemic Recovery
Box office revenue in Asia-Pacific fell 71.8% year over year to $3.81 billion in the first 11 months of 2020, according to data from OpusData compiled by S&P Global Market Intelligence.Read the Full Article
LatAm Box Office Revenue Down 82% YOY as Region Recovers from COVID-19 Hit
Latin America's box office revenue fell 82.2% year over year in the first 11 months of 2020 to $300 million as the region experienced a slow recovery from the COVID-19 outbreak, according to data from OpusData compiled by S&P Global Market Intelligence. This is compared to a year-over-year fall of 82.1% in the year through October 2020.Read the Full Article
Streaming Debuts, New Production Schedules: How 2020 Changed Film for Good
After a year of turmoil, the only certainty in the theater business is that 2021 will bring further uncertainty.
NYC Theater Reopenings Boosts AMC, Cinemark; Disney Surges on Streaming Play
Shares in AMC Entertainment Holdings Inc. and Cinemark Holdings Inc. jumped after New York Gov. Andrew Cuomo tweeted that New York City cinemas could reopen at limited capacity starting March 5.
Cuomo said movie theaters can open at 25% capacity, with no more than 50 people per screen. Masks and assigned seating will be required, he added.Read the Full Article
Potential MGM Buyers Must Weigh Content Demand Against Studio's Heavy Debt
Adding to the tumult in an already turbulent film and television industry, MGM Holdings Inc. is reportedly putting itself, along with its library of 4,000 films and 17,000 TV episodes, up for sale.
MGM has seen a slow but steady increase in revenue over the past five years, from $1.18 billion in 2016 to $1.54 billion in 2019. However, that growth could curtail in the pandemic year 2020.
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Bundling Fixed & Mobile Services is Still a Popular Strategy for Operators in Western Europe Especially in Portugal and Spain
In Western Europe, among countries where regulators publish subscriber bundle figures, Portugal and Spain featured the highest household penetration rate in 2019, at 98.1% and 82.0% respectively. In France, the number is higher than the reported 71.1%, which accounts for "accesses to TV bundled with broadband" and omits non-TV combinations. Meanwhile, Denmark and the Netherlands lag at 28.6% and 34.2%, respectively.
Latin America Multichannel Broadband Market 2020 Recap
The COVID-19 pandemic caused some unexpected changes in the Latin American multichannel and broadband markets in 2020.Read the Full Article
Analysts Say High Cost of C-Band Spectrum Leaves Verizon, AT&T Reeling
Verizon Communications Inc. and AT&T Inc. spent big in the recent C-band auction, but analysts worry the true cost of the eye-popping results may far outstrip the actual dollars paid.Read the Full Article
Analysts Bullish on Big Cable Operators Despite Slowing Broadband Growth
Cable broadband subscriber growth in 2021 will not match the gangbuster numbers seen in 2020.Read the Full Article
Disney/SEC Deal 1st Step in Moving Sports Rights from ESPN to ESPN+
S&P Market Intelligence believes that The Walt Disney Co.'s 10-year exclusive agreement with the Southeastern Conference, announced on Dec. 10, is just the first in a number of long-term sports rights deals that will fuel both ESPN Inc. and its streaming offshoot ESPN+.
Although ESPN (US) has been bleeding subs due to cord cutting and cord shaving, ESPN + is on a growth trajectory. S&P Market Intelligence believes that it will continue to line up digital rights that will enable it to, over time, shift a number of games — and the costs with them — over to ESPN+.
MediaTalk Episode 18: CBS Sports’ Super Bowl and March Madness Game Plan
The NFL championship kicks off in Tampa's Raymond James Stadium on Feb. 7, and CBS Sports Chairman Sean McManus is excited about the network providing coverage of a record 21st Super Bowl.
In the latest episode of "Media Talk," a podcast from S&P Global Market Intelligence, McManus not only discusses the high-profile match-up between generational quarterbacks — Patrick Mahomes of the defending champion Kansas City Chiefs and Tom Brady, now leading the Buccaneers — but that CBS Sports has sold out inventory in the big game. That said, the company's sales team can still squeeze in advertisers looking for positions in pre-game and halftime segments.
'Rural Cable is All the Rage,' Analysts Say
Rural cable operators have never been hotter.
With the pandemic increasing demand for high-speed internet at home, analysts believe rural cable operators stand to benefit more than other broadband providers from the changing dynamics of the industry. Rural markets are traditionally less competitive; they have lower broadband penetration rates; and a higher proportion of customers in these markets are still using legacy DSL connections, making them attractive targets for cable operators.
Cable Nets Struggle with Cash Flow Declines Due to Cord Cutting, Pandemic
Cash flow margins for cable networks are not expected to contract significantly — to 37.4% in 2020 from 38.0% in 2019 — in large part because contracting ad revenue and flat-to-shrinking affiliate fees have been offset by reductions in selling, general and administrative as well as programming costs.Read the Full Article
Rural Cable Operators 'Well Positioned' to Succeed Beyond Pandemic
The COVID-19 pandemic has led to an increased reliance on broadband for a multitude of use cases, but the shifting fundamentals of the cable industry could bode well for cable operators beyond the pandemic.Read the Full Article
The U.S. Broadcast Radio Sector's Recovery is Now Set to Drag into 2022
The U.S. broadcast radio sector is still recovering from the pandemic's fallout, more slowly than first expected. Broadcast radio advertising is highly correlated to expectations for consumer spending. Radio advertising is also predominantly local, has short lead times, and is dependent on listening in the car. When the coronavirus pandemic hit in March 2020, radio advertisers were very quick to react and reduce radio adverting spending in response to stay-at-home orders and economic uncertainty. While radio advertising revenue declined relatively in line with our expectations in 2020, S&P Global Ratings expects its recovery will be slower than initially expected and likely extend into 2022.
- Radio advertising revenue declined broadly in line with our previous expectation of negative 23.5% last year.
- Broadcast radio advertising's recovery will now drag into 2022 given the stalled U.S. economic recovery.
- Working from home means less commuters listening during peak rush hours, hurting advertising revenues.
- Broadcast radio companies with large digital footprints will likely recover faster and more fully.
- Rating outlooks are mostly negative, reflecting ongoing uncertainty around the recovery of broadcast radio advertising.
Following Record 2020, TV Groups Eye Robust Political Ad Revenues from Mid-Term
2020 was rough in many respects, but it was a great year for political ad spending.
Five of the largest TV station owners were among the big beneficiaries of that spending, as TV remains the principal means by which candidates and parties disseminate their messages. The broadcasters said robust fourth-quarter 2020 spending capped a record year for political ad revenues. The bounty has executives already looking ahead to the category's prospects during what is expected to be a competitive 2022 mid-term cycle.
Digital Ad Spend in Europe Resilient in Face of Pandemic
Advertising spend in Western Europe fell 6.3% year over year in 2020, less than the expected 10.3%, as digital mediums performed better amid the coronavirus pandemic than expected.Read the Full Article
Warner Media Looks to Redraw Kids Offering with Extensive Preschool Commitment
As it tries to woo advertisers with varied offerings across its unified kids and family unit, Warner Media LLC is placing a high emphasis on the preschool audience, including an extended block that will run on Cartoon Network / Adult Swim (US) and streaming service HBO Max.Read the Full Article
Can a Subscription Service Solve Twitter's Engagement Problem?
Regardless of what form Twitter Inc.'s planned subscription service ultimately takes, analysts say it is not just about lifting profits.
While Twitter executives recently confirmed the company is working on a nonadvertising subscription-based service, Twitter has so far provided few specifics on what the offering could look like and when it will launch.
Social Audio a 'Goldilocks Medium' for Boosting Usage at Facebook, Twitter
Influencers and celebrities have been flocking to Clubhouse, an invitation-only voice-chat social networking app launched in March 2020 that allows users to interact in live conversations on various topics. With the app's usage suddenly skyrocketing, the format has caught the attention of Facebook Inc. and Twitter Inc.Read the Full Article
How Big Tech's Fight Down Under Could Transform Social Media's Future
Big tech's clash with the Australian government is far from over and could provide a foretaste of what is to come globally, analysts said. Facebook Inc. and Alphabet Inc.-owned Google LLC are pushing back against a proposed law in Australia that would effectively require the platforms to pay publishers for the content distributed on their sites.Read the Full Article