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Sean Bailey’s Disney Legacy: Reanimation and Later, Exhaustion | Analysis
by Drew Taylor
Wed, March 6, 2024 at 8:00 AM CST

In October of 2010, at a lavish and intimate New York City press event dubbed the Walt Disney Studios Holiday Showcase, Disney treated studio personnel, press and tastemakers to a screening of new footage, including from “Tron: Legacy.”

Introducing the footage was Sean Bailey, the movie’s charismatic producer who had been appointed president of Walt Disney Studios Motion Picture Production 10 months earlier.

The event — showcasing the long-awaited sequel to a groundbreaking Disney classic made, like the original with cutting-edge technology — was a perfect introduction to Bailey, whose tenure at the company would be defined by mining beloved IP with high-tech upgrades.

He’s now set to exit the Walt Disney Company, bringing an end to a nearly decade and a half tenure that at once reinvigorated and exhausted the studio’s live-action output. He had proved keenly able to accomplish things that eluded previous regimes, plumbing Disney’s past as a way of preserving its future. But in the end, Bailey was a victim of his own oversized success, as the studio’s run of wildly successful live-action remakes started to go bust.

“Sean Bailey was a champion who was saddled with the thankless task of supervising the animation remakes that managed to damage the legacy titles and diminish the brand,” a filmmaker who worked with Disney during Bailey’s tenure told TheWrap.

It seemed like a good idea at the time.

Once upon a time…​

A few weeks into Bailey’s tenure, the studio released “Alice in Wonderland,” a live-action version of the studio’s 1951 animated classic festooned with elaborate visual effects and released in eye-popping 3D mere months after “Avatar” had become a phenomenon. A homecoming of sorts for director Tim Burton, who had started his career in the studio’s animation department, the movie was a huge hit and made $1 billion worldwide.

Disney had experimented in the 1990s with live-action remakes to their animated titles, most successfully with a John Hughes-penned “101 Dalmatians” starring Glenn Close. But it had been 10 years since the last attempt. The success of “Alice in Wonderland” opened new opportunities, as Bailey turned to the company’s vault for an entirely new cinematic universe. He didn’t greenlight “Alice in Wonderland,” but he turned it into a certifiable formula.

“We thought if Iron Man and Thor and Captain America are Marvel superheroes, then maybe Alice, Cinderella, Mowgli, and Belle are our superheroes, and Cruella and Maleficent are our supervillains,” Bailey told me in 2017 of his approach to the live-action remakes that became a staple of the studio throughout the 2010s. “Maybe if there’s a way to reconnect with that affinity for what those characters mean to people in a way that gets the best talent and uses the best technology, that could become something really exciting. It feels very Disney, playing to the competitive advantages of this label.”

After “Alice,” a plan came together — there would be a “Sleeping Beauty” live-action remake told from the point of view of the self-described Mistress of Evil, “Maleficent” (played by Angelina Jolie). Tim Burton was courted to direct; when he turned it down, Disney went for his production designer Robert Stromberg. It was a borderline-disastrous shoot, with an additional director brought in for reshoots and a storyline that so radically changed that journalists who attended a set visit were banned from reporting what they saw. The movie nevertheless made almost $800 million worldwide and inspired a sequel years later.

Bailey was going to follow this “fractured fairy tale” approach — telling a familiar story from a different angle — for a planned version of “Cinderella” where Cinderella was left for dead in a forest, forced to befriend a rogue knight and stop a wedding that was of political importance to the kingdom. But Disney scrapped that after much development and instead opted for a more faithful remake, hiring Kenneth Branagh to give it some weight. It made more than $500 million and proved that a live-action remake of a Disney animated classics wasn’t just a fluke — it was now a franchise.

There were some tenuous moments as Bailey tried to mount this new array of live-action features. Oftentimes, he and his team wouldn’t communicate which animated properties they were planning to adapt, which chafed at the folks at Walt Disney Animation Studios, several Disney insiders told TheWrap. These wounds would heal, with Bailey and his team not only alerting the animation studio but also relying on them heavily, after the animation teams’ feelings were known.

The “Alice in Wonderland” sequel, “Alice: Through the Looking Glass,” shows how closely they had aligned. Not only were filmmakers given access to the vast Disney animation archive but a single merchandise push celebrated both the new movie and the animated classic. Internally, it was known as the “Uber Alice” approach.

Other live-action adaptations followed — Jon Favreau’s technically inventive “The Jungle Book,” another “Alice,” and a nearly shot-for-shot remake of “Beauty and the Beast” that cost a fortune (at the time it was the most expensive musical Hollywood had ever produced, with a $255 million budget) and earned even more ($1.27 billion worldwide).

By 2019, Bailey and his team had released five live-action adaptations of Disney animated classics — two of them made over $1 billion (“Aladdin” and “The Lion King”), one disappointed (Tim Burton’s take on “Dumbo,” significantly rejiggered at the 11th hour and leaving Burton with a bad taste in his mouth) and one debuted alongside the company’s premiere direct-to-consumer streaming platform, Disney+ (“Lady and the Tramp”).

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The Resurrectionist​

While live-action remakes of animated Disney classics largely defined Bailey’s tenure, he was also able to return to the past for other properties.

In 2004, Disney purchased the rights to the Muppets characters but didn’t exploit them until Bailey arrived. Under Bailey’s leadership, Disney produced two theatrical movies, although neither hit big – 2011’s “The Muppets” (worldwide gross: $165 million) and 2014’s “Muppets Most Wanted,” which cost more than the first film ($50 million vs. $45 million) and made considerably less ($80.4 million).

He also managed to get a sequel to “Mary Poppins” into theaters, something that the company had been attempting, in earnest, since the late 1980s. “Mary Poppins Returns” finally came out in 2018, with Emily Blunt in the lead and Lin-Manuel Miranda in his first major role following his “Hamilton” success. It made almost $350 million worldwide.

Bailey ticked off more boxes from the list of things nobody else had achieved at the Mouse House. He fulfilled Walt Disney’s dream of adapting Frank L. Baum’s “The Wizard of Oz” books with the Sam Raimi-directed “Oz the Great and Powerful” in 2013, although its nearly $500 million gross wasn’t enough to follow through with a planned theme park expansion. He had Steven Spielberg direct a movie for Disney (“The BFG”), made a film that involved Walt Disney himself (“Saving Mr. Banks”) and finally got a starry version of “Into the Woods” to the big screen after more than 15 years of development at various studios.

He elongated the “Pirates of the Caribbean” franchise after the conclusion of the initial trilogy to the tune of another $1 billion (“On Stranger Tides”) and $750 million (“Dead Men Tell No Tales”), respectfully. And he continued to give the go-ahead to so-called “brand deposit” movies — projects that might not make a ton of money but contribute to the value of the company and the Disney name, like the inspiring baseball story “Million Dollar Arm” and the real-life chess underdog film “Queen of Katwe.”

There were bumps along the way for sure, including Gore Verbinski’s costly “The Lone Ranger” (which was given the go-ahead by a previous regime), the live-action debut “John Carter” (ditto) from “Finding Nemo” director Andrew Stanton and Brad Bird’s George Clooney-led “Tomorrowland.” The latter was a high-concept sci-fi adventure that was meant to open up a new universe of interconnected stories and enliven the futuristic section of the Disney parks. “Tomorrowland” grossed $200 million against a budget around $190 million. But it was proof that Bailey wasn’t always interested in the easy lay-up, and supported artists who he believed in on projects that colored outside the lines.

In Burbank, Bailey’s office is lined with framed photographs from the movies he’s produced. He asks the filmmakers to deliver him a single image that speaks to the entire film. Maybe it was from a particularly arduous sequence. Maybe it’s just one that makes them smile. But they all hang, beautifully arranged, in his office. The only person to buck convention was Bird, who instead gave Bailey three images from “Tomorrowland.”

Given that the film underperformed in a pretty big way, it’d be easy to imagine an executive hiding that one in a drawer. But Bailey didn’t retrench. He put them up on the wall, where the framed photos stayed to this day.

Trouble in the Magic Kingdom​

2019 was a notable year in Bailey’s tenure not only because Disney was increasing the output of the animation-to-live-action machine but because that was the year that Disney+ went live. Bailey was supervising a suite of new features for the service, most of which have now been removed (things like “Stargirl,” “Timmy Failure: Mistakes Were Made” and “Flora and Ulysses”).

The pandemic further complicated the ramp up, with several live-action Disney titles originally meant for theatrical exhibition (like “The One and Only Ivan” and “Artemis Fowl”) going straight to Disney+. Others, like “Jungle Cruise” (Bailey’s attempt at extending the based-on-a-theme-park ride concept that made “Pirates of the Caribbean” such a sensation) and live-action adaptation “Cruella,” premiered simultaneously in theaters and on Disney+ with a surcharge.

Disney’s live-action “Mulan,” which gained unwanted controversy for the decision to shoot in an area of China known for the persecution of the country’s Uighur minority, was another one of these hybrid releases. It made less than $70 million theatrically on a budget of more than $200 million. While much of “Mulan’s” underperformance can be attributed to outside forces (the controversy, the pandemic), it was also clear that something was amiss. Instead of hewing close to the goofy, charming, semi-musical historical fantasy of the animated feature, this was a straightforward kung fu epic.

Following a pair of direct-to-streaming efforts that barely registered (Robert Zemeckis’ “Pinocchio” and David Lowery’s wonderful “Peter Pan & Wendy”), Disney (and Bailey) thought it had an ace up its sleeve: “The Little Mermaid.” It was an iconic Disney title that helped kick off the animation studio’s creative renaissance. It should’ve been a slam dunk.

At the world premiere in Los Angeles last year, director Rob Marshall said he had been toiling away on the movie for more than five years. They had shot (and re-shot) during the pandemic and were finally here. The movie cost more than $200 million to produce. Internally, Disney thought it could crack $1 billion worldwide. It wound up with $569 million — a far cry from the halcyon days of “Beauty and the Beast” and “The Lion King.”

The ride, it appeared, was over.

Faced with diminishing returns and a Disney vault of IP to mine that was getting emptier, a fresh approach was needed.

What now?

A number of live-action adaptations will still see the light of day. A “Lion King” prequel/sequel called “Mufasa: The Lion King,” directed by Barry Jenkins, is out this Christmas. There’s a new “Snow White” out next spring that enlisted Greta Gerwig to work on the script. And a “Lilo & Stitch” remake from “Marcel the Shell with Shoes On” director Dean Fleischer Camp is currently in production. Plus, there’s the live-action “Moana,” with Dwayne Johnson (Bailey’s partner in Teremana Tequila) reprising his role as Maui, scheduled to shoot later this year.

Beyond that, things get hazier. Bailey had lined up a “Cruella” sequel (with Emma Stone set to return), a live-action “Hercules” from Guy Ritchie, and a version of “The Aristocats” directed by Questlove. Additionally, TheWrap has exclusively learned that Sarah Polley is no longer directing a new version of “Bambi.” It’s unclear if the project will move forward now that Bailey is gone.

Iger said on Tuesday at a Morgan Stanley investor conference that Disney had “killed a few projects already that we just didn’t feel were strong enough.” Could corporate mandates have offed Bambi’s mother this time?

David Greenbaum will replace Bailey under a mandate from Iger to make fewer, better movies. A former co-head of Searchlight Pictures, the indie division of 20th Century, Greenbaum oversaw major awards players like “The Shape of Water,” “12 Years a Slave” and “Slumdog Millionaire.” In his new role, he will be president of Disney live-action and 20th Century Studios.

This year Greenbaum is responsible for “Poor Things,” which racked up 11 Oscar nominations and was widely praised as one of the year’s very best movies. Internally, Disney was wowed by the film – it’s visually dazzling, emotionally resonant and actually says something about the world (through a prism of fantasy and sci-fi).

Before he left, Bailey was planning to do more theme park-based projects. In addition to a “Jungle Cruise” sequel, Bailey was looking to revive the “Pirates of the Caribbean” franchise (“Last of Us” creator Craig Mazin was working on a new take). Over the years, scripts based on the Matterhorn, Space Mountain and Tower of Terror (with Taika Waititi attached as director) had been commissioned, with little movement. Will they finally see the light of day? Or will Greenbaum take things in an entirely different direction?

Bailey was never a contender to take over for Bob Iger, who is still supposedly retiring in 2026. Instead, he had to look after his own Magic Kingdom, full of the flesh-and-blood embodiments of everybody’s favorite princesses. And, somewhat ironically, he will return as a hands-on producer on “Tron: Ares,” the long-awaited third film in the series, currently filming in Vancouver.

Bailey’s impact on the studio — for better and worse — cannot be overstated. He combed through the company’s back catalog and came out with an entirely new type of live-action Disney movie that sustained the company for nearly a decade. Even if the gambit had run its course by the time he stepped down, it still made an impact. Rival studios DreamWorks and Universal, for example, are currently at work on a live-action “How to Train Your Dragon” adaptation.

But hey, every fairy tale has to end at some point, right?

The post Sean Bailey’s Disney Legacy: Reanimation and Later, Exhaustion | Analysis appeared first on TheWrap.
 
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At Last, the Box Office Has a Variety of Promising Films Again
by Jeremy Fuster
Wed, March 6, 2024 at 11:30 AM CST

After weeks of box office struggles, theaters are finally heading into a weekend where multiple films could bring a diverse crowd of moviegoers into their auditoriums.

Along with the critically praised “Dune: Part Two,” which has grossed $89 million domestically over four days, a pair of bears will arrive on the big screen. There’s the goofy panda bear Po in Universal/DreamWorks’ family film “Kung Fu Panda 4,” and there’s the monstrous teddy bear Chauncey in Lionsgate/Blumhouse’s “Imaginary.”

“Kung Fu Panda 4” is currently tracking to take the No.1 spot with an opening weekend of at least $56 million, with rival distributors saying the film has a chance to top $60 million. The first “Kung Fu Panda” opened to $60 million before inflation adjustment in 2008, while “Kung Fu Panda 3” opened to $41 million in 2016.

“Imaginary” is tracking for a third place opening on the charts with $10-14 million, which would put it in the same neighborhood as Blumhouse’s January release “Night Swim,” which opened to $11.7 million and grossed $51.8 million worldwide against a $15 million budget.

What’s most important for theaters is that all three of these films has their own lane. On opening weekend, “Dune: Part Two” took 64% of its audience from moviegoers over 25, with the 25-34 cohort taking the largest share. While Gen Z may start coming in thanks to the sequel’s immensely strong word-of-mouth, it will likely be the same core of millennials and Gen Xers driving interest in “Dune,” particularly those waiting for open screenings on Imax and other premium theaters to become available.

“Kung Fu Panda 4,” may get some turnout from nostalgic millennials, but it will of course rely primarily on families for turnout. While Illumination’s “Migration” didn’t set the box office ablaze, it legged out decently en route to a $123 million domestic/$277 million worldwide run against a $72 million budget.

That shows that the appetite for family films is still strong, and Universal is counting on that as “Kung Fu Panda 4” plays throughout March and into April while kids cycle through spring school breaks.

“Imaginary,” meanwhile is a PG-13 horror film, and that means its target audience is teens and Gen Z adults under the age of 25. It’s that demographic that has driven recent titles like “M3GAN” to breakthrough hit status, and even if the word-of-mouth on “Imaginary” isn’t strong enough to get it that far, Gen Z turnout should be strong enough to turn a modest theatrical profit.

The best-case scenario for theaters is that all three films continue to find sustained turnout among their core demographics into the latter half of March, when sequels to “Ghostbusters” and “Godzilla vs. Kong” will try to bring in four-quadrant turnout heading into the spring. Strong opening weekend and holdover totals are both needed for a healthy theatrical market, and at least for the duration of March, the films on the slate have the potential to provide that.

The post At Last, the Box Office Has a Variety of Promising Films Again appeared first on TheWrap.
 
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How the Major Streamers Stack Up in Subscribers and Revenue | Charts
by Lucas Manfredi
Thu, March 7, 2024 at 8:15 AM CST

Netflix is still the king of streaming. But while it continues to lead in subscribers and average revenue per user (ARPU) after the latest round of earnings, Disney and Warner Bros. Discovery have continued to make strides toward reaching profitability.

Netflix outpaced the legacy media competition in the 4th quarter of 2023, reporting 260.2 million subscribers total, 13.1 million of which were new, making it the company’s second best quarter ever for sign-ups (the record was set in 2020 during the COVID-19 lockdown).

Disney+ cemented the No.2 position with 149.6 million, despite losing 1.3 million core subscribers during its latest quarter as a result of churn from recent price increases. When combined with Hulu’s 49.7 million subscribers and ESPN+’s 25.2 million subscribers, the House of Mouse collectively boasts 224.5 million streaming subscribers.

Meanwhile, Warner Bros. Discovery’s direct-to-consumer division made third place with just shy of 100 million subscribers (97.7 million to be exact). Paramount Global and NBCUniversal’s Peacock continue to lag behind with 67.5 million and 31 million subscribers, respectively.
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Netflix is still the ARPU champ, for now​

Netflix continues to lead on the ARPU front with $16.64 in the United States and Canada. But Warner Bros. Discovery has started to gain ground on Hulu, while Disney+ is closing in on Peacock. During their latest quarters, Hulu reached an ARPU of $12.29, followed by Warner Bros. Discovery’ $11.65, Peacock’s roughly $10, Disney+’s $8.15 and ESPN+’s $6.09. Paramount does not disclose the average revenue per user figure for its DTC business.

The light at the end of the profitability tunnel is starting to come into view as Disney and Warner Bros. Discovery expect to get there in 2024, while Paramount Global and Peacock could follow in 2025.

Source: Company Earnings Reports

Source: Company Earnings Reports
Because Amazon Prime Video and Apple TV+ don’t release streaming subscriber or ARPU figures, they are not included in this analysis.

In 2021, Amazon reported more than 200 million Prime members worldwide and said over 175 million of them had streamed its film and television content in the past year. But the tech giant has not offered an update since then. Amazon CEO Andy Jassy told analysts in February that the tech giant has “increasing conviction” that Prime Video can be “a large and profitable business on its own.”

On Jan. 29, Prime Video launched its ad tier offering, which will be the default for all subscribers. The streamer will offer a new ad-free option for an additional $2.99 per month for U.S. members. Currently, Amazon Prime, which includes Prime Video, costs $14.99 per month or $139 a year. A membership that only includes Prime Video and none of the company’s shipping benefits costs $8.99 a month.

Apple says it has over 1 billion paid subscriptions in its Services segment, which includes Apple TV+, Apple Arcade, Apple Fitness+, Apple News+, Apple Music and iCloud. But the tech giant does not break that total out by individual services.

Check out TheWrap’s quarterly deep dive on each company below, with updated numbers from their financial disclosures.

Netflix

Netflix added 13.1 million subscribers in Q4 for a total of 260.28 million. The figure includes 80.13 million in the U.S. and Canada, 88.81 million in the Europe, Middle East and Africa region, 46 million in Latin America and 45.34 million in the Asia-Pacific region.

The company recorded revenue of $3.93 billion in the U.S. and Canada, $2.78 billion in the EMEA region, $1.1 billion in Latin America and $963 million in the APAC region. Average revenue per user grew 3% year over year to $16.64 in the U.S. and Canada and $10.75 in the EMEA region and 4% to $8.60 in Latin America, but fell 5% to $7.31 in the APAC region.

In its shareholder letter, Netflix said that paid sharing is now the “normal course of business” and will allow it to grow and more effectively penetrate an addressable market of about 500 million connected TV households (excluding China and Russia). The streamer expects that addressable market to increase over time as broadband penetration rises.

The ad tier surpassed 23 million monthly active users globally and now accounts for 40% of all sign-ups. The offering’s base grew by nearly 70% quarter over quarter, supported by product improvements and the phasing out of Netflix’s Basic plan for new and rejoining members.

The ad tier is currently available in 12 countries, including the U.S., Canada, Australia, Brazil, France, Germany, Italy, Japan, Korea, Mexico, Spain, and the United Kingdom — representing about 80% of global ad spend.

“We’ll see in the fullness of time, but I’d say we’ve got years of work ahead of us to take the ads business to the point where it’s a material impact to our general business,” co-CEO Greg Peters told analysts during the company’s earnings call.

Looking ahead, paid subscriber additions are expected to fall in the first quarter, but be up compared to 1.8 million additions in the first quarter of 2023. Netflix said it would retire the Basic plan in some of the countries where its ad tier is available, starting with Canada and the United Kingdom in the second quarter.

Disney, Hulu and ESPN+​

Disney narrowed its total streaming losses by 79% year over year to $216 million in its first quarter of 2024, with DTC revenue growing 14% year over year to $6.08 billion. The company, which is on track to exceed $7.5 billion in cost savings, expects to reach profitability across its three streaming services by the end of the fiscal year.

Disney+ shed roughly 600,000 subscribers for a total of 149.6 million. The service lost 1.3 million core subscribers for a total of 111.3 million, including 46.1 million subscribers in the U.S. and Canada and 65.2 million international subscribers. Disney+ Hotstar accounted for the remaining 38.3 million of the total.

The loss in core subscribers was driven by the expected temporary uptick in churn due to recent domestic price increases, as well as the end of a global summer promotion. Those losses were offset by ad tier net additions and launches in certain international markets during the quarter.

At the same time, Hulu added 1.3 million subscribers for a total of 49.7 million, including 45.1 million SVOD only subscribers and 4.6 million Hulu + Live TV subscribers. ESPN+ shed 800,000 subscribers for a total of 25.2 million.

Disney+ saw its domestic ARPU grow 9% quarter over quarter to $8.15. Elsewhere, its core subscriber ARPU climbed 2% quarter over quarter to $6.84, while Hotstar’s ARPU increased 38% quarter over quarter to $1.28. Excluding Hotstar, international ARPU fell 3% to $5.95 due to a higher mix of subscribers to promotional offerings.

Hulu reported SVOD-only ARPU growth of 1% quarter over quarter to $12.29 and Hulu + Live TV growth of 4% to $93.61. ESPN+ grew 14% quarter over quarter to $6.09.

In addition to ESPN+, Disney is launching a joint sports streaming venture with Warner Bros. Discovery and Fox this fall, as well as a fully direct to consumer version of ESPN in August 2025, The Disney+/Hulu combo app, which is currently in a beta, is also targeting an official launch in March.

Looking ahead, Disney expects between 5.5 million and 6 million net subscriber additions in the second quarter. Domestic net adds are expected to be in the 7.5 million range, while international core subscribers are expected to decrease modestly, reflecting changes to certain wholesale deals and slightly elevated churn impacts from price increases.

Disney also plans to begin cracking down on password sharing in 2024, with a notable benefit from the paid sharing initiatives expected in the back half of calendar year 2024.

Warner Bros. Discovery​

After two consecutive quarters of subscriber declines, Warner Bros. Discovery added 1.8 million subscribers for a total of 97.7 million. That includes 54.6 million domestic subscribers and 42.3 million international subscribers, with 1.3 million subscribers coming from the company’s acquisition of BluTV.

Revenue for the DTC segment grew 3% year over year to $2.53 billion. Average revenue per user grew 7.5% year over year to $11.65 domestically, 12.4% year over year to $3.88 internationally and 7% year over year to $7.94 globally for the quarter. The DTC division includes traditional HBO cable subscriptions and the Max and Discovery+ streaming services in its results.

On the profitability front, WBD posted a loss of $55 million in its direct-to-consumer division for the quarter, down from a loss of $217 million. For the full year, it swung to a profit of $103 million — its first profitable streaming year — compared to a loss of $1.59 billion in 2022.

Looking ahead, WBD said its DTC business would record “modestly negative” EBITDA in the first half of 2024 before turning profitable in the second half of the year. WBD is targeting $1 billion of direct-to-consumer EBITDA in 2025.

Paramount Global​

As speculation around a potential sale hangs over the company, Paramount narrowed its streaming loss for the quarter to $490 million, an $85 million year-over-year improvement. The company expects to attain domestic streaming profitability in 2025.

The direct-to-consumer division, which includes Paramount+ and its free, ad-supported streamer Pluto TV, added 4.1 million subscribers during the fourth quarter for a total of 67.5 million. DTC revenue grew 34% year over year to $1.87 billion. Subscription revenue grew 43% to $1.3 billion, driven by subscriber growth and pricing increases at Paramount+.

Paramount+ revenue grew 69% to $1.35 billion, driven by subscriber growth and ARPU expansion. Paramount does not disclose its streaming ARPU figure, but touted a 31% year-over-year increase.

The media conglomerate expects 2024 subscriber growth to come in lower than 2023, but expects “very healthy” growth in Paramount+ revenue. Chief financial officer Naveen Chopra said Paramount would exit hard bundle relationships where the economics weren’t compelling, representing a loss of “a couple million subs.”

“Ultimately, the ability to drive deeper engagement and ARPU growth, while slowing the rate of growth in content expense, is the path to profitability in streaming,” Chopra told analysts.

Peacock​

Peacock ended 2023 with 31 million paid subscribers after adding 3 million during the fourth quarter, up nearly 50% year over year. Average revenue per user is around $10, unchanged from the previous quarter.

The NBCUniversal-owned streamer’s adjusted EBITDA loss narrowed to $825 million from $978 million in the prior year period and its revenue grew 57% year over year to $1 billion, compared to $660 million a year ago. Peacock marked peak losses of $2.7 billion in 2023, with meaningful improvement expected in 2024.

Comcast president Mike Cavanagh said leveling off the growth rate of programming spend would “clearly” be part of improving Peacock’s losses, but noted that he’s more focused on the long-term “totality of the media business.”

“We’ve navigated a very good path for us,” he told analysts.

The post How the Major Streamers Stack Up in Subscribers and Revenue | Charts appeared first on TheWrap.
 


https://deadline.com/2024/03/jay-ra...son-peltz-not-out-to-fire-the-ceo-1235849094/

Jay Rasulo Says “Disney Runs In My Blood”; Former Parks Chief With Activist Investor Nelson Peltz Not Out “To Fire The CEO”​

By Jill Goldsmith
March 7, 2024 11:10am

Nelson Peltz and Jay Rasulo, who are fighting to get themselves elected to the Disney board against the company’s wishes, said today they’re not out “to fire the CEO.” Peltz of Trian Partners has been publicly bashing the company and Iger for a year. Rasulo hasn’t taken the stage publicly until today as the two answered questions from shareholders on a live webcast.

The queries — curated and read by a moderator seated at a conference table with the two men — served pretty much as setups for them to hit all their talking points, bashing executive pay, park prices, a wobbly studio, a “toxic” culture after so many reorgs, and, though they didn’t use the word, woke content that turns off Disney’s traditional family viewers.

“I don’t think the shareholder [who lamented the latter] is alone. I think when I was at the company, and all the years [before], when people see the Disney name on a movie, they never said, ‘Can I take my family to [see it]? And will I have to explain what was going on between those people?’ … It was just guaranteed.”

Disney insists Rasulo has been too long away from the company and the entertainment business and wouldn’t work well with the current chief. He left after being passed over as Iger’s successor. Rasulo denied it. “I worked 15 years alongside Bob. I don’t think we ever had a cross word. I can work with Bob.”

He said he remains steeped in the Disney culture. “My kids are Disney kids. My wife is a Disney wife. I had the opportunity to open up Hong Kong Disneyland, launched two new cruise ships. I ran Euro Disney (Disneyland Paris) … I love the company.”

Shareholders will vote on directors at Disney’s April 3 annual meeting.

Trian basically claims the board is made of Iger patsies and holds no one to account, resulting in a lack of vision and a stock price that could be higer. He’s been funding a hugely expensive proxy fight and forcing Disney to spend back, lobbying shareholder not to elect the outsider candidates. Iger at a media conference this week said accountability is a priority. He reiterated that the complexities facing the media industry need seasoned pros, and it’s even hard for them.

Peltz has some muscle since from Marvel boss Ike Perlmutter is allowing it to vote his shares. Asked if they’re just stand-ins for Perlmutter, Peltz called that “a very silly argument.”

“We are our own people,” added Rasulo. “We don’t carry other people’s water.”
 
There is now a link on the ProxyVote site to register to (virtually) attend the Shareholder's meeting in April. You'll need your Control Number in order to register, but it's quick and easy. From what they posted, you'll need to register before the meeting in order to dial in.
 


https://www.yahoo.com/entertainment/paramount-global-crossroads-does-mean-233000171.html

Paramount Global Is At a Crossroads — What Does That Mean for Paramount+?
by Daniel Quinaud
Fri, March 8, 2024 at 5:30 PM CST

Among the major legacy companies, Paramount Global is the most affected by changing structural forces in the media and entertainment ecosystem. In a beleaguered industry, there may not be another conglomerate as beleaguered as Shari Redstone’s media empire.

A combination of an unprofitable direct-to-consumer segment, a faltering studio operation and exposure to linear TV has made Paramount Global’s problems outweigh its many strengths, such as owning one of the most valuable TV libraries and the rights to the NFL for another decade. Not having juicy theme park revenue to fall back on, à la Disney and Universal, also doesn’t help.

Paramount faces a dilemma: Should the company combine forces with a larger company or dismantle, selling its various assets incrementally and becoming a supplier of content to other platforms in a competitive streaming industry? And what would be the role of its streaming service, Paramount+, in any of these scenarios?

Paramount-owned networks are the main source of content for Paramount+. The four leading linear channels — Nickelodeon, CBS, MTV and Comedy Central — are responsible for around one-third of the total demand for the entire Paramount+ TV catalog. CBS shows command more than one-fifth of on-platform demand. Most notably, these shows are made up of popular and rewatchable procedurals like “Hawaii Five-0,” “NCIS,” “Criminal Minds” and “Blue Bloods.”

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This breakdown shows the platform’s exposure to linear TV at a time when the model is rapidly declining. Paramount+ has popular originals, especially within the Star Trek and Taylor Sheridan franchises, but these do not yet provide a substantial enough boost for the platform’s TV catalog. Original shows are responsible for 14.7% of the on-platform TV demand, meaning they cannot support the streamer alone.

Paramount+ benefits largely from having access to titles from networks under Paramount Global’s corporate umbrella, providing the platform with a diverse library. Each network caters to a different niche.

Analysis of the platform’s demographic distribution shows that CBS originals are more appealing to old and female audiences, with a few notable exceptions. “Criminal Minds” and “Big Brother” appeal to younger audiences, and “Blue Bloods” and “48 Hours” have a predominantly male viewership. Comedy Central shows, on the other hand, skew towards an older and male viewer base. Paramount+ originals seem to draw older audiences across both genders.


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MTV titles cater to young and female audiences on the platform, thanks to the network’s emphasis on reality TV. Most notably, “The Challenge” and “Jersey Shore: Family Vacation” were the most in-demand MTV shows on Paramount+ last quarter. For even younger audiences, Nickelodeon provides popular animations such as “Avatar: The Last Airbender” and “The Loud House.”

This diverse library is an asset for Paramount in a content-supplier scenario. In a streaming landscape dominated by platforms owned by tech giants, segments of Paramount’s library could attract many potential buyers looking to enhance their streaming services and with more financial resources to expend.

Daniel Quinaud is a senior data analyst at Parrot Analytics, a WrapPRO partner. For more from Parrot Analytics, visit the Data and Analysis Hub.

The post Paramount Global Is At a Crossroads — What Does That Mean for Paramount+? appeared first on TheWrap.
 
https://deadline.com/2024/03/box-office-kung-fu-panda-4-dune-part-two-imaginary-1235850148/

‘Kung Fu Panda 4’ KO-ing $55M, ‘Dune: Part Two’ $44M As Overall Weekend Jumps +13% Vs. 2023 – Saturday Box Office

By Anthony D'Alessandro - Editorial Director/Box Office Editor
March 9, 2024 7:58am PST

SATURDAY AM: Quick update here. Universal/DreamWorks Animation’s Kung Fu Panda 4 is coming in higher with a $19.4M Friday (including previews) and $55M, which is the same amount that How to Train Your Dragon: Hidden World opened to back in 2019. Brand animation always opens big. That’s still the second best stateside start for the Kung Fu Panda franchise. CinemaScore is A-, the same grade as the first movie, but a notch down from the As earned on two and three.

PostTrak audiences gave the fourthquel an 80% positive and 59% definite recommend whilte kids under 12 were 90% positive and a 70% must see. Male skewing at 58% with 67% of the audience between 13-24. 18-24 year olds showed up at a massive 48%. Diversity demos are 44% Latino and Hispanic, 22% Caucasian, 11% Black and 18% Asian. PLFs are accounting for 6% of tickets sales while 3D is driving 17%. West and South are the most vibrant with the highest grossing cinema in the nation for the pic being The Cinemark Tinseltown El Paso TX with a near $40K so far.

Legendary/Warner Bros’ Dune: Part Two earned around $12.3M yesterday for what’s shaping up to be a $44M second weekend, -47%, for a running total of $154.7M. With those two movies leading the pack, it’s shaping up to be a $133.3M weekend, +13% over the same frame a year ago when Scream VI bowed. Wow. It’s been a while since we’ve seen an up weekend.

Lionsgate/Blumhouse’s Imaginary is third with $3.6M yesterday (including previews) at 3,118 theaters for what’s shaping up to be a $9.3M opening. Not shocking to see this movie below its $10M-$14M projection, nor saddled with a C+ CinemaScore and 57% on PostTrak. It is rather slow for a PG-13 horror film and there’s nothing really hip to hook the girls ala M3GAN. But it was cheap to make at $10M. Still more product means depth at the box office.
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Demos are 53% women, 62% between 18-34, and 18-24 the biggest quad at 32% and another 20% from 13-17 year olds. Diversity demos are 38% Latino and Hispanic, 35% Caucasian, 17% Black, 6% Asian. The Teddy Bear is stuffed best in East, South and South Central with The CNMK Tinseltown El Paso the biggest grossing venue with $8K.

Angel Studio’s Cabrini at 2,840 theaters is also coming in under expectations which isn’t a shock with $3M yesterday and around $8M for the weekend. Though made by the same director of Sound of Freedom, Alejandro Monteverde, there’s nothing in saintly nuns for QAnon and the far right to get excited about. Thank God. Those faith-based who showed up gave the movie an A CinemaScore and 94% PostTrak. Sixty nine percent of the audience are women with the largest demo being 55+ at 49%. Diversity demos are 65% Caucasian, 21% Latino and Hispanic, 4% Black, 6% Asian & 5% NatAm/Other. West is the softest region for Cabrini though the rest of the country is fairly even. The Regal UA King of Prussia in Philly market is the pic’s top grossing theater so far with a near $29K.
 
https://variety.com/2024/biz/news/d...ltz-disruptive-destructive-vanity-1235938192/

Mar 11, 2024 - 9:58am PDT
by Todd Spangler

Disney Slams Activist Investor Peltz as ‘Disruptive and Destructive,’ Says His Proxy Fight ‘Seems More About Vanity Than a Belief’ in Company

Disney came out swinging in its most strongly worded denunciation yet of Nelson Peltz and the activist investor’s bid to grab two seats on the Mouse House’s board.

In a video posted Monday to its shareholder campaign site (votedisney.com), Disney labeled the proxy fight waged by Peltz’s Trian Partners “disruptive and destructive.” Trian is urging Disney investors to vote in Peltz and Jay Rasulo, former CFO at Disney, at the company’s April 3 annual shareholders meeting.

If Peltz and Rasulo succeed in getting seats on Disney’s board, “Disney could suffer the same fate as other great companies that Peltz has previously infiltrated, such as GE and DuPont,” a narrator says in the nearly three-minute video. “Nelson Peltz has a long history of attacking companies to the ultimate detriment of shareholder value.”

Peltz’s “quest also seems more about vanity than a belief in Disney,” the company alleges in the video. “Why else would he sell 500,000 Disney shares over the past six months in the middle of his proxy fight?”

The video goes on to point out that Peltz has no experience running a global media company (excerpting a clip of a Peltz interview in CNBC in which he said, “They said I have no media experience — I don’t claim to have any”). Regarding Rasulo, who was Disney’s CFO from 2010-15, the video calls him “a former employee who was passed over for a promotion nearly a decade ago” and says “the last time [Rasulo] joined the board of a media company” — iHeartMedia — “the stock tanked.”

In addition, the Disney video — which is produced in the style of a political attack ad — says Peltz and Rasulo have teamed up with ex-Marvel chairman Ike Perlmutter, a “former disgruntled employee… who has his own lengthy record of destructive behavior inside Disney.” About 79% of the shares claimed to be beneficially owned by Trian are owned by Perlmutter. The video reiterates the company’s assertion that Perlmutter nurses a longstanding personal grudge against Disney CEO Bob Iger: “This sort of personal animus in the boardroom is more than disruptive — it can be destructive.”

“The Walt Disney Co. has turned a corner and is focused on creating lasting, long-term value,” the video says. Among the points cited: Disney’s board has authorized $3 billion in stock repurchases in fiscal year 2024 and increased the cash dividend to shareholders to 45 cents/share payable in July (up 50% from the January dividend). The video also cites Disney’s $1.5 billion investment in Epic Games, the fall 2024 release of “Moana 2” and the March 14 release of “Taylor Swift’s Eras Tour (Taylor’s Version)” on Disney+.

Iger, at an investment conference last week, commented about Peltz’s proxy fight, “This campaign is designed to distract us. I am working really hard to not let this distract me, because when I get distracted everybody who works for me gets distracted, and that’s not a good thing.”

Disney’s shareholder campaign site also posted two letters from grandkids of Walt Disney and his brother Roy O. Disney, who criticized the activist investor firms and threw their support behind Iger and the current board.

Meanwhile, Peltz’s Trian on March 4 released a lengthy white paper detailing strategic changes the hedge fund argues will improve Disney’s financial performance and boost its stock price. Among its suggestions: Disney should revamp its streaming-content strategy to take “more shots on goal”; consolidate Disney+ and Hulu operations; and produce fewer movie sequels. Trian also wants Disney’s board to “fix” the company’s “chronic succession problems” for the 73-year-old Iger, whose renewed CEO contract expires at the end of 2026.

Regarding Trian’s white paper, Disney claimed in the new video that it includes “surprising number of questionable proposals that reinforces clear lack of experience in media” as well as a number of suggestions Disney is already implementing.
 
https://www.msn.com/en-gb/money/oth...shari-redstone-to-fire-bob-bakish/ar-BB1jHVgr

Analyst Rich Greenfield Wants Shari Redstone To Fire Bob Bakish
by Jon Lafayette
3/11/24

Outspoken media analyst Rich Greenfield is calling on Paramount Global controlling shareholder Shari Redstone to fire the company’s CEO, Bob Bakish.

According to Greenfield, creating and trying to build Paramount Plus into a streaming service that can compete with Netflix and Disney Plus has been a costly strategic mistake.

Because Bakish has continued to double down on streaming, Greenfield sees firing Bakish as the surest way to change that strategy.

Greenfield believes Paramount would be better off as an “arms dealer,” profitably supplying programming to companies competing in the streaming wars.

The launch of Paramount Plus “left Paramount with a subscale streaming platform, a weakened relationship with its MVPD/vMVPD partners and an over-levered balance sheet as linear TV headwinds grow stiffer,” Greenfield said in a report Monday.

“To make matters worse, it is not even clear what the best course of action is now given the aforementioned strategic missteps that are now hard or impossible to quickly reverse,” Greenfield said.

One of Bakish’s other missteps, as far as Greenfield is concerned, was the decision not to sell Showtime in a deal worth $3 billion.

“After Redstone came up with the idea to sell Showtime, Bakish convinced the Board that keeping the asset was a better idea to financially engineer improved profitability at Paramount Plus and increase the subscriber base of Paramount Plus by giving Paramount Plus to existing Showtime subscribers,” Greenfield noted.

The $3 billion a sale could have brought in would have helped Paramount Global’s balance sheet. Plus, it would have cleared up an awkward situation with distributors.

“So now there are millions of Showtime subscribers who are getting a streaming service that includes the linear CBS network and a wide array of the content found on Paramount’s linear cable networks, while ALSO paying for that same content as part of their basic cable subscription,” according to Greenfield.

Greenfield said before Viacom was combined with CBS to form Paramount Global, “there is no doubt that Bob Bakish was the right CEO to helm Viacom in 2016.” Greenfield credits Bakish with playing a critical role in improving Viacom’s relationships with distributors and improving internal morale at the company.

Greenfield also endorses Redstone’s decision to combine Viacom with CBS as being prescient in seeing that scale would be important in the media business and consolidation would continue.

But he noted that Viacom was worth $12 billion and CBS was worth $18 billion five years ago. Now the combined company is worth only $7.5 billion.

“Given our belief that Bob Bakish does not agree with our stated strategy and is directly responsible for what is today Paramount Plus, we believe Shari Redstone and National Amusements must terminate Bob Bakish and seek new leadership at Paramount immediately," Greenfield concluded. "It may already be too late to save Paramount, but a new strategic direction is the best hope Redstone and National Amusements have for saving what is left of the company.”
 
https://www.yahoo.com/entertainment/youtube-tv-thriving-cable-replacement-130000258.html

YouTube TV Is Thriving in the Cable Replacement Space as a ‘One-Stop Shop’ for Consumers
Kayla Cobb
Tue, March 12, 2024 at 8:00 AM CDT

As many entertainment industry experts declare the streaming wars over, one challenger is giving streaming king Netflix a run for its money in total viewers: YouTube.

The Alphabet-owned video platform has beaten out all the major streamers for the highest share of TV viewing over the past 12 months, according to Nielsen. Its YouTube TV subscription service is also gaining ground on the major cable giants in the U.S. as cord-cutting continues to weigh heavily on the traditional carriers.

As the networks bleed video customers, YouTube TV reported 8 million subscribers in 2023, nearly double its closest vMVPD (virtual Multichannel Video Programming Distributor) competitor, Hulu + Live TV, which most-recently reported 4.6 million subscribers.

With a quarter of pay TV subscriptions now coming from digital services — a shift that is altering the cable landscape — YouTube TV is positioned as a trailblazer.

“We believe this is the start of the new arms race on streaming, with YouTube in a position to gain more market share on cord-cutting customers,” Daniel Ives, managing director and senior equity research analyst for Wedbush Securities, told TheWrap.

YouTube disrupted the television industry by prioritizing overall viewership above all else — embracing both creator content from its main video platform and its live TV vertical, while also investing in live sports.

Rather than fighting over the same channels as its traditional and digital pay TV competitors, YouTube is melding the creator-generated content it’s known for with a cable alternative. And YouTube has already won over the coveted Millennial and Gen Z viewers other cable offerings are struggling to entice — and found a way to bring cable TV to them.

“Getting a scaled platform like YouTube in your ecosystem really allows you to integrate creators,” YouTube Global Head of Media and Sports Partnerships Lori Conkling told TheWrap.

The platform has become a “one-stop shop” for consumers: In addition to a channel business, YouTube offers pay-per-view, TVOD (transactional video on demand), AVOD (advertising-based video on demand) and pay TV. “You don’t need to leave YouTube,” Conkling said. “If you come here, we want to over-deliver for you.”

But as with other tech company video platforms, YouTube TV, which is part of the larger YouTube ecosystem owned by Alphabet, is not being altogether transparent about its performance. The pay TV division doesn’t have to report growth statistics as often as most of its competitors. So while the platform leads the vMVPD pack for now, Wall Street isn’t holding it to any specific growth targets.

The YouTube empire

When YouTube first launched in 2005, its aim was to give creators a platform to make their own content. Over the years, that service has grown across multiple verticals including movies and TV, sports and music.

The expansion started in 2014 with the launch of YouTube Premium (formerly YouTube Red), which offered an ad-free option for YouTube as well as the ability to play videos offline and access original content. The YouTube Originals program that produced the popular series “Cobra Kai” never quite took off and was shuttered in 2022, with “Cobra Kai” moving to Netflix. (It shut down after the departure of global head of originals Susanne Daniels and as the company opted to use the investment on other initiatives more relevant to the YouTube creator ecosystem.)

The curated YouTube Kids followed in 2015, with YouTube Music and the video-on-demand service YouTube Movies & TV launching in 2018. Those were followed by a specialized app for emerging markets (YouTube Go), a TikTok competitor (YouTube Shorts) and a short-lived Instagram Stories competitor (YouTube Stories).

Then in 2017 the company launched YouTube TV. A cable replacement of sorts, the platform offered subscribers access to the big five networks — ABC, NBC, CBS, Fox and the CW — and select cable networks like Food Network, HGTV and Disney Channel.

All of these investments have created a media powerhouse. In January, YouTube’s share of TV viewing stood at 8.6%, according to Nielsen’s The Gauge, with Netflix coming in second at 7.9% for the month. The rest of the pack (Prime Video, Hulu, Disney+, Peacock, Tubi, Max, Roku Channel, Paramount+ and Pluto TV) each held a less than 3% share.

Courtesy of Nielsen

Courtesy of Nielsen
YouTube is thriving with Gen Z. A Piper Sandler survey of over 9,000 Gen Z teens released in the fall found that the age group spends 29.1% of daily video consumption on YouTube, compared to Netflix’s 28.7% and Hulu’s 7.7%.

Netflix co-founder Reed Hastings has acknowledged the threat YouTube posed to viewership.“Our largest competitor for TV viewing time is linear TV,” he said in 2021. “Our second largest is YouTube, which is considerably larger than Netflix in viewing time.”

And thanks to YouTube TV, the company’s dominance in the attention economy has a direct link to TV. The service has cemented its position as the fourth-largest pay TV operator in the U.S. with 8 million subscribers, up from its last disclosure of 5 million in July 2022.

While Hulu + Live TV ended the first quarter of 2024 with 4.6 million subscribers, other vMVPD offerings fell even further behind YouTube TV, with Sling TV reporting 2.06 million subscribers and Fubo reporting 1.62 million subscribers in North America for their fourth quarters of 2023.

But YouTube TV’s true competitors are the cable giants themselves. Currently, the offering has more subscribers than Dish TV’s 6.47 million subscribers. Spectrum owner Charter Communications is the pay TV leader with 14.12 million video customers, followed by Comcast with 14.11 million subscribers.

DirecTV does not publicly disclose its figures. However, Leichtman Research estimated it ended 2023 with about 11.3 million subscribers, down from an estimated 11.85 million for the third quarter of 2023.

Source: Company Earnings Reports/Leichtman Research Group

Source: Company Earnings Reports/Leichtman Research Group
Charter, Comcast, Dish and DirecTV shed 5.81 million subscribers in 2023, while YouTube TV added 1.9 million subscribers. Hulu + Live TV gained 100,000, Sling lost 297,000 and Fubo added 173,000 during the year, according to Leichtman Research Group founder Bruce Leichtman.

The pay TV ecosystem is declining largely because many of the companies are “not aggressively pursuing new customers,” Leichtman told TheWrap. As a result, YouTube TV has become the default video service for many rural cable companies that have “essentially completely given up on video,” he said.

“It’s not necessarily because [YouTube is] doing it better. While everybody is taking a step back, they’re taking a step forward,” Leichtman said. “They don’t care about the low margin on the business.”

Charter and Comcast have pivoted their efforts to a joint streaming venture called Xumo, which has launched more than 1 million of its boxes nationwide since launching in October. Comcast and DirecTV have also launched live TV streaming services Now TV and DirecTV Stream, respectively, while Charter’s recent carriage agreement with Disney has allowed it to bundle Disney+ and ESPN+ with its Select TV video packages.

YouTube TV’s flexible model involves allowing customers to sign up for one of its plans while also offering the option to add on select channels. Add ons can be priced as low as $1.99 a month.

YouTube TV’s lofty bet on sports pays off

One thing customers clearly want is live sports. Conkling credited YouTube TV’s partnership with the NFL as a key driver of its recent subscriber growth, though she declined to reveal how many people signed up for the Sunday Ticket. YouTube’s Sunday Ticket deal, which kicked off in the 2023 season, is valued at around $2 billion per year for seven years.

“Sunday Ticket was a driver to get people to subscribe to YouTube TV,” she said. “Now we’re seeing that they’re staying, which to us reinforces the value of the product itself.”

YouTube leveraged its ecosystem to deliver a younger and more diverse audience to the NFL and other sports leagues. For the NFL Draft, the company made partnership deals with YouTube creators to make videos about a variety of topics, including tailgating recipes. Those recipes brought in younger, female viewers interested in cooking, thereby expanding the overall audience for both the NFL and the creators. YouTube also launched an NFL Creator of the Week program, which gave creators unprecedented access to NFL events and introduced their audiences to the football league.

“Other leagues saw what we were doing with the NFL and proactively came to us and said, ‘I’d like to do that too,’ ” Conkling added.

The next frontier: The living room

As YouTube looks to build on the momentum, the platform is eyeing a territory long-dominated by both the cable giants and streamers: the living room. Global viewers collectively watch an average of more than 1 billion hours of YouTube content on their TVs every day.

“What we’re finding is as people watch content in the living room on their television, they’re watching on all our platforms,” Conkling said. “But they’re doing it in a way that really seamlessly creates an experience where they might watch creator generated content, followed by a movie, followed by clips and highlights from a sports game.”

Conkling stopped short of calling Netflix, Disney+ and other streamers “competitors,” noting that YouTube is constantly in conversation with direct-to-consumer services about how distribution through its Primetime Channels business can be mutually beneficial.

The company sees streamers as partners. Netflix and Paramount+ are among those that use the YouTube video ecosystem to share trailers, clips and behind-the-scenes interviews from their originals.

Networks and streamers routinely upload full episodes or even movies on YouTube for free to promote their originals. PBS uploads documentaries from its “Independent Lens” brands, and in February Netflix put its Oscar-nominated movie “Nimona” on the platform for a limited time (although this was really a thinly veiled campaign move).

An advertising boon and transparency issue

There is an asterisk over YouTube’s recent success. By not reporting subscriber numbers on a quarterly basis, YouTube can choose to focus on total time spent watching across its platforms — a metric that helps boost its overall advertising business — rather than on meeting subscriber growth targets for Wall Street.

YouTube “can throw a number out there every two and a half years, and we can get excited about it,” Leichtman told TheWrap. “But by doing that, they can operate in a completely different fashion than any public company can.”

During Alphabet’s fourth quarter earnings call in January, CEO Sundar Pichai touted its subscriptions as a $15 billion business on an annual basis, calling YouTube a “key driver” of the segment’s revenues.

Google Subscriptions, Platforms and Devices revenue increased 19% year over year to $34.69 billion, accounting for 12.7% of the total $272.54 billion in Google Services revenue for 2023, the company recently reported. The segment includes fees from YouTube Music, Premium and YouTube TV subscriptions and NFL Sunday Ticket, as well as revenue from Google Play app sales and in-app purchases and sales of Pixel devices.

YouTube ad sales climbed 7% year-over-year to $31.5 billion in 2023, accounting for 13% of Google’s total $237.86 billion in advertising revenue for 2023. By comparison, Netflix’s ad business was not material to its earnings in 2023.

“I’d say we got years of work ahead of us to take the ads business to the point where it’s a material impact to our general business,” Netflix co-CEO Greg Peters told analysts in January, adding the ads business “won’t be a primary driver” in 2024.

YouTube has no plans to become more consistently transparent. “We will continue to celebrate the wins and the successes that we see here,” Conkling said.

Other tech giants, said Insider Intelligence analyst Ross Benes, likely will continue to employ the same strategy for their streaming platforms: stay quiet unless you have something good to say. “Amazon and Apple will not release figures until they feel they gain an advantage from doing so,” Benes told TheWrap.

Regardless, YouTube’s recent growth underscores that the likely future of the cable bundle is streaming. Already, digital services like YouTube TV and Sling control about one quarter of all pay TV subscriptions, Benes said.

“Fundamentally, what we heard loud and clear is people want a price point that they feel represents the value of the offering,” Conkling said. “They don’t want to be locked into contracts. They want to have the ability to watch their pay television offering on their phone and have it be just as good as if they’re watching it on their TV.”

The post YouTube TV Is Thriving in the Cable Replacement Space as a ‘One-Stop Shop’ for Consumers appeared first on TheWrap.
 
https://www.axios.com/2024/03/12/apollo-explores-paramount-takeover

Scoop: Apollo reaches out to Paramount about deal
by Sara Fischer

Apollo Global Management in recent days has reached out to a special committee formed by Paramount Global about a possible takeover or asset purchase, two sources familiar with the matter tell Axios.
State of play: Apollo would face competition, including a group led by David Ellison's film and TV studio Skydance Media.
  • That rival group, which includes private equity firms KKR and RedBird Capital Partners, is evaluating an all-cash bid for Paramount's parent, National Amusements Inc. (NAI), which controls 77% of Paramount's voting stock and a 10% financial stake.
  • Apollo is said to be evaluating a deal only with Paramount, whose major assets include Paramount Pictures, broadcaster CBS, a slew of Viacom cable networks, and streaming services Paramount+ and PlutoTV.
  • It's also possible that Apollo could wind up bidding only on select assets.
Context: Speculation of Apollo's interest first surfaced in January, but then cooled after a February report that the investment firm was no longer interested.
  • Axios reported in December that Warner Bros. Discovery CEO David Zaslav met with Paramount Global CEO Bob Bakish to discuss a possible merger, but those talks are now paused.
  • NBCUniversal parent Comcast has reportedly explored a commercial partnership with Paramount, but a deal to buy the entire company would be difficult given regulatory constraints.
  • Representatives for Apollo, Paramount and NAI declined to comment.
Between the lines: Apollo is no stranger to Hollywood, but its interest in Paramount comes at a trying time for the industry.

In early 2022, Apollo took a $760 million minority stake in Legendary Entertainment, which has produced hits such as "Dune" and "Jurassic World."

It later eyed a joint bid for Starz with Roku, but the deal never materialized.
  • Apollo most recently helped Yahoo reinvent itself after acquiring the firm from Verizon in 2021.
The big picture: Paramount is under enormous pressure to find a strategic partner or buyer, as it stares down a mountain of debt.
What we're watching: Apollo could face regulatory pushback due to CBS' local broadcast stations.
  • Regulators killed a proposed takeover of Tegna by Apollo affiliate Standard General last year.
  • Apollo bought a majority stake in Cox Media's broadcast group in 2019.
 
https://variety.com/2024/tv/news/paramount-global-sells-viacom18-stake-reliance-1235941171/

Paramount Global Sells 13% Stake in India’s Viacom18 to Reliance for $517 Million
Sale comes after Reliance and Disney's $8.5 billion deal to merge TV and streaming assets in India

Mar 13, 2024 - 2:19pm PDT
by Todd Spangler

Paramount Global has sold its 13% ownership stake in TV and streaming company Viacom18 to Reliance Industries for $517 million. Reliance was already the majority owner of Viacom18.

The pact comes two weeks after Disney and Reliance Industries announced a blockbuster $8.5 billion deal merging their massive Indian TV and streaming businesses. As part of that agreement, Reliance’s Viacom18 is merging with
Disney’s Star India.

On March 13, Paramount Global entered an agreement with Reliance Industries to sell Paramount’s entire 13.01% equity interest in Viacom18 for the equivalent to approximately $517 million based on the current foreign exchange rate, according to a filing with the SEC on Wednesday.

Bodhi Tree, a company controlled by former Disney India chair Uday Shankar and James Murdoch, owns 15.97% of Viacom18.

Viacom18 calls itself “one of India’s fastest growing entertainment networks.” The business includes a portfolio of 38 channels across general entertainment, movies, sports, youth, music and kids genres. JioCinema, Viacom18’s streaming platform, is among India’s top streaming services, while Viacom18 Studios has produced and distributed Hindi films and regional films for more than 13 years in India.

For Paramount Global, the sale of its interest in Viacom18 is part of its efforts to bolster its balance sheet. The media company ended 2023 with long-term debt of $14.6 billion, down from $15.6 billion a year prior. In August 2023, Paramount Global announced a deal to sell the Simon & Schuster publishing business to investment giant KKR for $1.62 billion in cash. “[W]e’re highly focused on continuing to reduce balance sheet leverage,” Paramount Global CFO Naveen Chopra said on the company’s Feb. 28 earnings call.

The closing of Paramount Global’s sale of the Viacom18 stake is subject to certain customary conditions, including receipt of applicable regulatory approvals, as well as the completion of the previously announced joint venture involving Reliance, Viacom18 and Star Disney. After the closing, Paramount will continue to license its content to Viacom18, according to the filing.
 
https://www.business-standard.com/a...-on-four-divisional-heads-124031400064_1.html

In search for its next CEO, Disney board focuses on four divisional heads​

Iger is spending time with all of the internal candidates to help them understand how he approaches the job and give them exposure to business units they're not familiar with


Bloomberg
3 min read Last Updated : Mar 14 2024 | 7:51 AM IST

By Thomas Buckley and Lucas Shaw

Walt Disney Co's board is focusing on four divisional heads as part of a formal search for an eventful successor to Chief Executive Officer Bob Iger, people with knowledge of the matter said.
The four are TV chief Dana Walden, ESPN’s Jimmy Pitaro, theme-parks boss Josh D’Amaro and Alan Bergman, who heads the film business, according to the people, who asked not to be identified discussing private conversations.

As part of the process, Disney may appoint a No. 2 executive — a chief operating officer or president — to serve for a time before Iger steps down, according to the people. His contract runs through the end of 2026, and no decision on a successor is expected this year, the people said.

Iger is spending time with all of the internal candidates to help them understand how he approaches the job and give them exposure to business units they’re not familiar with, according to the people.
All of this is happening under the glare of dissident shareholders who are seeking seeking board seats at Disney’s April 3 annual meeting. Trian Fund Management’s Nelson Peltz, in particular, has been critical of the company’s succession planning, saying he and Jay Rasulo, Disney’s former chief financial officer, should join the board to invigorate the search.
Disney has outlined some of its succession planning in regulatory filings. A board committee formed last year met six times in fiscal 2023, working with a search firm, reviewing internal and external candidates, and conducting interviews.

Chairman Mark Parker, who oversaw a successful transition as CEO of Nike Inc., is leading the effort, along with three other board members: Morgan Stanley Chairman James Gorman, General Motors Co. CEO Mary Barra and Lululemon Athletica Inc. CEO Calvin McDonald.
The world’s largest entertainment company has struggled with succession in the past. Iger passed the baton to parks chief Bob Chapek in February 2020, only to return in November 2022 amid streaming TV losses and a public feud between the company and Florida politicians.
In 2015, the company named then-parks head Tom Staggs as chief operating officer, positioning him as possible successor to Iger. But Staggs stepped down a year later, and Iger extended his tenure for another four years.

Walden is seen as a brilliant creative executive with strong talent relationships, but she is still learning the streaming business and has little experience in parks. D’Amaro has plenty of savvy with parks and almost no background in film and TV. Pitaro is leading the charge into streaming for ESPN, the largest sports media company in the world, but has a smaller portfolio than most of his peers. Bergman has spent much of his career at the film studio, with his earlier years in financial roles.
Should Disney go outside the company for its new leader, it would be the first time since Michael Eisner got the job in 1984. Both Chapek and Iger were appointed from within.
 

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