All articles tagged with #streaming industry
Netflix is exploring a potential bid to acquire Warner Bros. Discovery's studio and streaming assets, having hired a bank to evaluate the opportunity and gaining access to the company's financial data, amid interest from other major tech and media firms.
Netflix has been a highly successful investment historically, with early shareholders becoming millionaires, but its current high valuation and increased competition suggest it may not be the best buy for future wealth accumulation.
YouTube TV and NBCUniversal resolved a carriage dispute, highlighting the shifting power dynamics in the TV industry as streaming services like YouTube TV grow rapidly and traditional cable providers lose subscribers. The deal includes direct content ingestion for Peacock on YouTube, signaling a new era of streaming negotiations and the decline of traditional linear TV.
Warner Bros. Discovery CEO David Zaslav suggests that a Trump administration could create a more favorable environment for major media mergers, potentially accelerating consolidation in the entertainment industry. Zaslav highlighted the challenges of the current streaming landscape, where numerous apps and pricing models complicate the consumer experience. He noted that regulatory changes under Trump could ease the path for mega-mergers, as seen in past discussions involving Warner Bros. Discovery and other media companies.
Warner Bros. Discovery CEO David Zaslav suggested that Donald Trump's potential re-election could accelerate media industry consolidation, offering opportunities for mergers and acquisitions. Zaslav emphasized the need for consolidation to improve consumer experience, as the current fragmented media landscape is unsustainable. His comments came during WBD's quarterly earnings call, highlighting the company's strategic stance amid industry changes and past regulatory challenges under Trump's administration.
As entertainment giants like Disney, Warner Bros. Discovery, Lions Gate Entertainment, and AMC Entertainment report their earnings results, investors are becoming more critical of companies that fail to meet expectations. The streaming industry is under pressure to increase profitability, leading to higher subscription prices and more advertisements. Cable TV providers and movie theaters are also grappling with the rise of streaming. Additionally, Hollywood is dealing with strikes by actors and writers, with issues such as AI usage and streaming payments at stake. The pressure to boost profits will impact the types of TV shows and films produced. Investors have been reacting negatively to earnings misses, with an average stock price drop of 5.2%.
Actress Jenna Ortega has been "banned" from becoming Wednesday Addams in the popular Netflix series "Wednesday" due to guidelines set by the Screen Actors Guild and American Federation of Television and Radio Artists (SAG-AFTRA) during the ongoing strike. The guidelines prohibit actors from dressing up as characters from struck work and posting images on social media. SAG-AFTRA clarified that the guidelines were meant to help content creators and members avoid promoting struck work and do not apply to anyone's kids. The strike, which focuses on AI use, streaming, and residual payments, has caused uncertainty regarding the production of the show's second season.
Netflix exceeded Wall Street expectations for Q3 earnings per share and subscriber growth, with a gain of 8.76 million subscribers. The company confirmed that a new round of price hikes is on the way. Netflix has been making progress with paid password sharing and advertising-backed subscriptions, with subscriptions to the ad plan rising 70% sequentially. Despite challenges from strikes in the industry, Netflix has generated over $5 billion in free cash flow in 2023 and expects to reach $6.5 billion for the full year. Content spending for the year is estimated to be around $13 billion.
Netflix is closing down its DVD-by-mail service and to commemorate the occasion, they are offering a special promotion where users can opt-in to receive up to 10 random DVDs from their movie queues. The promotion is available until August 29th for US users, with the final day of shipping being September 29th. It is unclear whether Netflix expects the DVDs back, but they will continue to accept returns until October 27th, 2023. This marks an important milestone for the streaming industry, as traditional broadcast and cable TV networks accounted for less than 50% of television viewership for the first time.
Workers across various industries, including UPS delivery drivers and Hollywood actors and writers, are experiencing labor unrest due to the changing demands of customers for speed and convenience. The COVID-19 pandemic accelerated these changes, pushing retailers to shift online and intensifying competition in the streaming industry. Overworked and underpaid employees are pushing back against forced overtime, punishing schedules, and reliance on lower-paid, part-time, or contract workers. Hollywood screenwriters and actors are striking over reduced pay and the pressure to produce content faster. Streaming services have disrupted entertainment economics, resulting in lower residuals and inadequate compensation. Similar issues are faced by UPS drivers, who have dealt with forced overtime and unpredictable schedules. While the UPS strike was a success, labor protests in other industries face challenges in achieving similar outcomes. The pandemic has shifted the focus to the well-being of workers and may lead to increased labor unrest in the future.
Analysts speculate that Netflix, with its strong financial position and projected profit surge, may be able to force a settlement to the ongoing strikes by the Writers Guild of America and Screen Actors Guild-American Federation of Television and Radio Artists before its rivals. While other major streaming services struggle to make profits, Netflix's robust health and potential revenue growth from initiatives like cracking down on password sharing and introducing advertising suggest that it can afford the costs of settling the strikes. This could give Netflix a unique advantage in the industry and position it as a friend to the artists, potentially pressuring its rivals to reach a deal that only Netflix can easily afford.
Walt Disney Co. is reportedly set to lay off thousands of employees next week, including about 15% of the Disney staff in the entertainment division. The job cuts will affect every region where Disney operates, including TV and film divisions, theme parks, and corporate positions. This move comes as part of the company's cost-cutting measures to save $5.5 billion in annual costs, and follows the announcement of 7,000 job cuts in February.
David Zaslav, CEO of Discovery, challenged the streaming industry's orthodoxy by focusing on unscripted programming and bundling services. Now, rivals such as Disney and WarnerMedia are following his lead, as they seek to differentiate themselves in a crowded market. The competition is intensifying as media companies vie for subscribers and advertising dollars, with Discovery+ having already gained 15 million subscribers since its launch in January.