wabbott
DIS Veteran
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Those pre-Covid margins of 20%+ ain't slouchy at all. Looks like a money-making business to me.
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wabbott
DIS Veteran
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https://www.hollywoodreporter.com/b...nings-preview-second-quarter-2023-1235530788/
Netflix Earnings Preview: Bullish Wall Street Expects Progress on Password-Sharing Crackdown, Ad Tier
Macquarie speaks of a "potentially momentous" quarterly update, while peers predict signs of accelerating growth in the second half of the year.
by Georg Szalai
July 17, 2023 10:29am
Amid Hollywood’s historic double strike, Netflix is on deck after the market close on July 19 with its second-quarter report that will kick off media earnings season and shed light on its subscriber momentum, the progress of its cheaper advertising tier and the impact of its password-sharing crackdown.
Popular second-quarter originals from the streamer have included the likes of Queen Charlotte: A Bridgerton Story. Heading into the financial and operating update, Wall Street has been bullish on Netflix shares, which gained over the first half of 2023 and are up more than 50 percent year-to-date.
A slew of analysts has in recent days and weeks raised their price targets on the company’s stock. After all, one key theme across the Street is an expectation of positive updates on the progress of the firm’s password-sharing crackdown and advertising tier rollout.
“Investors (are) focused on sub trends and ramping monetization efforts when Netflix reports,” TD Cowen analyst John Blackledge wrote in a July 11 report. “Investors will look for updates on Netflix’s monetization efforts – paid sharing and advertising tier.” He has designated the streamer’s stock as one of his “best ideas” for 2023. “Netflix’s paid sharing coupled with the ad tier rollout should drive long-term revenue upside, and the launch of paid sharing in the second quarter of 2023 along with the ramping ad tier should help drive membership and revenue growth in the second half of 2023.” Specifically, the TD Cowen analyst forecasts net subscriber growth of 2.37 million in the second quarter, “versus consensus of around 1.7 million,” and a net gain of 12.1 million and “revenue re-acceleration” in the second half of 2023. All in all, Blackledge reiterated his “outperform” rating and $500 stock price target.
That same day, UBS analyst John Hodulik boosted his Netflix stock price target from $390 to $525, while maintaining his “buy” rating. “We see Netflix as the main beneficiary as peers prioritize profits in streaming,” he wrote and highlighted positive data points. “Netflix introduced paid sharing more broadly in the second quarter. As a proxy for potential churn, we monitored Google search interest in ‘cancel Netflix,’ which saw less inflection in key markets launched in the second quarter than what was observed in Canada/Spain in the first quarter,” Hodulik wrote. “We continue to believe paid sharing will drive 5 percent-plus uplift to revenue and see the roll-out as key to driving scale in advertising with the growth in the ad-tier mix and better targeting. Netflix eliminated its basic ad-free tier in Canada (and de-emphasized in the U.S.), which we estimate could provide a 10 percent uplift to average revenue per user over time and should help scale the ad base faster than prior expectations.”
All in all, the UBS expert raised his estimates and predicted second-quarter financials would beat management’s guidance, adding that he and his team “still expect accelerating second-half growth.” Hodulik now forecasts 3.6 million net subscriber gains in the second and 6.5 million in the third quarter, “bringing our ’23 estimate to 18 million (12 million prior; 9 million in ’22).” And he noted: “We expect third-quarter guidance to imply faster revenue and operating income growth, boosted by accretion from paid sharing.”
Evercore ISI analyst Mark Mahaney has also generally been a Netflix bull, having an “outperform” rating and $400 price target on the stock. But in the headline of a Monday report, he warned investors: “Tread Lightly Into Great (Subs) Expectations.”
“Buyside expectations in terms of net sub adds are almost certainly higher than (on the) Street, with the market likely looking for more like 4 million-5 million subs in the second quarter and a similar to higher level in the third quarter (5-7 million),” Mahaney wrote. “If the positive intra-quarter sub trends reported by third-party tracking services are accurate, these expectations appear reasonable. But we would view them as likely limiting the opportunity for upside surprise and increasing the odds of a negative surprise.”
Explained Mahaney: “Thus, we would prefer to buy Netflix shares after the (results) rather than before and have issued a tactical ‘underperform’ call on Netflix for the (results).”
The Evercore ISI analyst also pointed out that Netflix’s stock has exceeded his $400 price target, “and we removed it from our top picks list last month, but we are sticking with (an) ‘outperform’ rating on Netflix as we believe this stock still has legs.” He noted his bull case for Netflix, which includes its stock price possibly hitting $500 by 2024, “driven by an incremental 20-30 million subs growth from ’23 to ’25 from SAVOD (subscription ad-supported VOD) and paid sharing benefits.”
Many recent Netflix reports have focused on such bullish commentary. At the end of June, for example, Oppenheimer analyst Jason Helfstein also boosted his stock price target for Netflix by $50 to $500, while maintaining his “outperform” rating, “in anticipation of higher subscribers on bullish indicators for paid sharing and higher revenue/sub with potential discontinuation of lowest-priced ad-free plan.” He argued that the company could phase out its advertising-free “Basic” streaming plan, as it is currently testing in Canada, estimating such “a phase-out of the Basic plan could generate an incremental $4.4 billion for Netflix over a 12-month period.”
Helfstein also sees further potential upside for the company. “(An) extended writers strike would disrupt back-to-school TV calendar, likely pushing more users/viewing to Netflix, given it’s programming lead-time,” he wrote. “Netflix benefits from a deep backlog as well as international content that is unaffected by strike. Additionally, Netflix is likely benefiting from media job cuts, as competitors struggle amid ad market weakness and subscription services cash drain.”
For the second quarter, Helfstein raised his subscriber forecast from 234.2 million to 235.1 million, a gain of 2.6 million instead of 1.7 million.
Just on Thursday, July 13, Macquarie analyst Tim Nollen added his take on the latest financial and operating update: “Netflix’s earnings report on July 19 could be even more impactful than usual. Based on the stock’s second-quarter outperformance and several recent sell-side estimate and target price increases, the bar is already set pretty high.”
This fact “may well be justified,” he argued, pointing out that Netflix launched its $7.99 paid sharing plan in the U.S. in May, with early “positive” third-party readings on consumers’ response. “We expect the most important aspect of Netflix’s crackdown on password sharing will be the catalyst it creates to attract more users to its $6.99 ad tier base, in turn generating higher revenue from advertising, while both new plans bring higher average revenue per user,” Nollen concluded. “This may be partially offset by price cuts in over 100 countries, and on the earnings side, by costs associated with this rapid ad tier buildout.”
The Macquarie expert increased his 2023 and 2024 earnings estimates “as we layer in upside from our ad tier and paid sharing calculations,” leading him to boost his stock price target from $350 to $410 and speaking of a “potentially momentous” quarterly update. But Nollen maintained his “neutral” rating on Netflix shares, highlighting that he and his team will “await second-quarter results before assessing if further changes to numbers are warranted.”
Pivotal Research Group analyst Jeffrey Wlodarczak is the biggest Netflix bull on Wall Street, in June raising his stock price target from $425 to a Street high of $535 with a “buy” rating. “It remains well positioned to generate solid subscriber and revenue/free cash flow growth even in a potential global recessionary environment via their better monetization of the approximate 100 million-plus households that currently utilize Netflix outside of paying households via password sharing,” he explained. “This should be enhanced by the subscriber and subscriber monetization benefits from their ad-supported tier.” And the expert highlighted: “Importantly, Netflix, unlike its streaming peers, has demonstrated massive scale economies which is evidenced by the major ramp in free cash flow in ’22/’23, a trend we expect to continue ‘24” and beyond.
Another Netflix stock price boost, by $100 to $450, came on July 10 from Morgan Stanley analyst Benjamin Swinburne. “We are bullish on the Netflix business as continued execution, competitor withdrawal and disciplined expense trends increase our outlook,” he explained.
That said, he maintained his “equal-weight” rating on the stock, highlighting: “On a 12-month view, however, there may be more risk of multiple compression from here than multiple expansion and we wait for a better entry point.” Explained Swinburne: “A year ago, nothing was priced in for either paid sharing or the ad-tier as shares traded at about 13 times estimated 2024 consensus earnings per share. Today, at about 30 times, much is expected.”
But the expert also emphasized the bull case. “Netflix is poised to demonstrate how good a business streaming can be at scale,” he wrote. “The combination of accelerating revenue against limited expense
growth is set to improve returns.”
Meanwhile, Goldman Sachs analyst Eric Sheridan, in a July 4 report, upgraded Netflix from “sell” to “neutral” and boosted his stock price target from $230 to $400. “Strategic Initiatives Drive Operating Outperformance,” the former Netflix bear highlighted in the headline of his report, in which he also summarized: “Netflix continues to execute against its global password and ad tier initiatives.”
Sheridan noted that his “sell” recommendation had been based on the view that the global streaming giant “would face a series of headwinds from post-pandemic subscriber growth normalization, heightened industry competitive pressure, potential pressure on subscriber gross additions from the consumer spending environment and volatile subscriber performance as it rolled out its password sharing crackdown initiatives.”
But the Goldman expert likes what he has seen so far, writing: “In short, Netflix management has executed its password sharing initiative in excess of our prior assumptions, has regained content creation momentum in a manner that has muted any post-pandemic growth headwinds and overall industry competition has become more muted (especially from traditional media companies) in the past six months.”
Sheridan concluded that his upgrade was needed “to reflect the overall positive current operating performance for Netflix and continued forward positive operating momentum into 2024/2025.”
The Goldman analyst forecast the streamer ending the second quarter with 236.0 million subscribers, up from the 232.5 million recorded as of the end of its first quarter. Overall, Netflix’s global subscribers total was 232.5 million at the end of its first quarter of 2023.
The most recent bullish Netflix analyst report came out on Friday. In it, Wedbush Securities analyst Michael Pachter, who has an “outperform” rating and $485 stock price target on Netflix, cited positive takeaways from a survey that his team commissioned that he said should support his bullish thesis. “Netflix remains on Wedbush’s Best Ideas list, given our view that the company can generate significantly more free cash flow than its guidance suggests,” he explained. “We think Netflix has reached the right formula with its global content to balance costs and generate increasing profitability. At the same time, its ad-supported tier and password sharing crackdown should further boost cash generation.”
Speaking of those initiatives, Wedbush commissioned a streaming-focused survey by Momentive in July to track trends in the second and going into the third quarter. Among the takeaways were “improved awareness and uptake of Netflix’s advertising subscription tier” and “a positive overall reception to Netflix’s password-sharing crackdown,” Pachter highlighted. His conclusion: “As such, we think Netflix’s second-quarter earnings results will meet or exceed Street expectations, and we expect shares to rise.”
Netflix Earnings Preview: Bullish Wall Street Expects Progress on Password-Sharing Crackdown, Ad Tier
Macquarie speaks of a "potentially momentous" quarterly update, while peers predict signs of accelerating growth in the second half of the year.
by Georg Szalai
July 17, 2023 10:29am
Amid Hollywood’s historic double strike, Netflix is on deck after the market close on July 19 with its second-quarter report that will kick off media earnings season and shed light on its subscriber momentum, the progress of its cheaper advertising tier and the impact of its password-sharing crackdown.
Popular second-quarter originals from the streamer have included the likes of Queen Charlotte: A Bridgerton Story. Heading into the financial and operating update, Wall Street has been bullish on Netflix shares, which gained over the first half of 2023 and are up more than 50 percent year-to-date.
A slew of analysts has in recent days and weeks raised their price targets on the company’s stock. After all, one key theme across the Street is an expectation of positive updates on the progress of the firm’s password-sharing crackdown and advertising tier rollout.
“Investors (are) focused on sub trends and ramping monetization efforts when Netflix reports,” TD Cowen analyst John Blackledge wrote in a July 11 report. “Investors will look for updates on Netflix’s monetization efforts – paid sharing and advertising tier.” He has designated the streamer’s stock as one of his “best ideas” for 2023. “Netflix’s paid sharing coupled with the ad tier rollout should drive long-term revenue upside, and the launch of paid sharing in the second quarter of 2023 along with the ramping ad tier should help drive membership and revenue growth in the second half of 2023.” Specifically, the TD Cowen analyst forecasts net subscriber growth of 2.37 million in the second quarter, “versus consensus of around 1.7 million,” and a net gain of 12.1 million and “revenue re-acceleration” in the second half of 2023. All in all, Blackledge reiterated his “outperform” rating and $500 stock price target.
That same day, UBS analyst John Hodulik boosted his Netflix stock price target from $390 to $525, while maintaining his “buy” rating. “We see Netflix as the main beneficiary as peers prioritize profits in streaming,” he wrote and highlighted positive data points. “Netflix introduced paid sharing more broadly in the second quarter. As a proxy for potential churn, we monitored Google search interest in ‘cancel Netflix,’ which saw less inflection in key markets launched in the second quarter than what was observed in Canada/Spain in the first quarter,” Hodulik wrote. “We continue to believe paid sharing will drive 5 percent-plus uplift to revenue and see the roll-out as key to driving scale in advertising with the growth in the ad-tier mix and better targeting. Netflix eliminated its basic ad-free tier in Canada (and de-emphasized in the U.S.), which we estimate could provide a 10 percent uplift to average revenue per user over time and should help scale the ad base faster than prior expectations.”
All in all, the UBS expert raised his estimates and predicted second-quarter financials would beat management’s guidance, adding that he and his team “still expect accelerating second-half growth.” Hodulik now forecasts 3.6 million net subscriber gains in the second and 6.5 million in the third quarter, “bringing our ’23 estimate to 18 million (12 million prior; 9 million in ’22).” And he noted: “We expect third-quarter guidance to imply faster revenue and operating income growth, boosted by accretion from paid sharing.”
Evercore ISI analyst Mark Mahaney has also generally been a Netflix bull, having an “outperform” rating and $400 price target on the stock. But in the headline of a Monday report, he warned investors: “Tread Lightly Into Great (Subs) Expectations.”
“Buyside expectations in terms of net sub adds are almost certainly higher than (on the) Street, with the market likely looking for more like 4 million-5 million subs in the second quarter and a similar to higher level in the third quarter (5-7 million),” Mahaney wrote. “If the positive intra-quarter sub trends reported by third-party tracking services are accurate, these expectations appear reasonable. But we would view them as likely limiting the opportunity for upside surprise and increasing the odds of a negative surprise.”
Explained Mahaney: “Thus, we would prefer to buy Netflix shares after the (results) rather than before and have issued a tactical ‘underperform’ call on Netflix for the (results).”
The Evercore ISI analyst also pointed out that Netflix’s stock has exceeded his $400 price target, “and we removed it from our top picks list last month, but we are sticking with (an) ‘outperform’ rating on Netflix as we believe this stock still has legs.” He noted his bull case for Netflix, which includes its stock price possibly hitting $500 by 2024, “driven by an incremental 20-30 million subs growth from ’23 to ’25 from SAVOD (subscription ad-supported VOD) and paid sharing benefits.”
Many recent Netflix reports have focused on such bullish commentary. At the end of June, for example, Oppenheimer analyst Jason Helfstein also boosted his stock price target for Netflix by $50 to $500, while maintaining his “outperform” rating, “in anticipation of higher subscribers on bullish indicators for paid sharing and higher revenue/sub with potential discontinuation of lowest-priced ad-free plan.” He argued that the company could phase out its advertising-free “Basic” streaming plan, as it is currently testing in Canada, estimating such “a phase-out of the Basic plan could generate an incremental $4.4 billion for Netflix over a 12-month period.”
Helfstein also sees further potential upside for the company. “(An) extended writers strike would disrupt back-to-school TV calendar, likely pushing more users/viewing to Netflix, given it’s programming lead-time,” he wrote. “Netflix benefits from a deep backlog as well as international content that is unaffected by strike. Additionally, Netflix is likely benefiting from media job cuts, as competitors struggle amid ad market weakness and subscription services cash drain.”
For the second quarter, Helfstein raised his subscriber forecast from 234.2 million to 235.1 million, a gain of 2.6 million instead of 1.7 million.
Just on Thursday, July 13, Macquarie analyst Tim Nollen added his take on the latest financial and operating update: “Netflix’s earnings report on July 19 could be even more impactful than usual. Based on the stock’s second-quarter outperformance and several recent sell-side estimate and target price increases, the bar is already set pretty high.”
This fact “may well be justified,” he argued, pointing out that Netflix launched its $7.99 paid sharing plan in the U.S. in May, with early “positive” third-party readings on consumers’ response. “We expect the most important aspect of Netflix’s crackdown on password sharing will be the catalyst it creates to attract more users to its $6.99 ad tier base, in turn generating higher revenue from advertising, while both new plans bring higher average revenue per user,” Nollen concluded. “This may be partially offset by price cuts in over 100 countries, and on the earnings side, by costs associated with this rapid ad tier buildout.”
The Macquarie expert increased his 2023 and 2024 earnings estimates “as we layer in upside from our ad tier and paid sharing calculations,” leading him to boost his stock price target from $350 to $410 and speaking of a “potentially momentous” quarterly update. But Nollen maintained his “neutral” rating on Netflix shares, highlighting that he and his team will “await second-quarter results before assessing if further changes to numbers are warranted.”
Pivotal Research Group analyst Jeffrey Wlodarczak is the biggest Netflix bull on Wall Street, in June raising his stock price target from $425 to a Street high of $535 with a “buy” rating. “It remains well positioned to generate solid subscriber and revenue/free cash flow growth even in a potential global recessionary environment via their better monetization of the approximate 100 million-plus households that currently utilize Netflix outside of paying households via password sharing,” he explained. “This should be enhanced by the subscriber and subscriber monetization benefits from their ad-supported tier.” And the expert highlighted: “Importantly, Netflix, unlike its streaming peers, has demonstrated massive scale economies which is evidenced by the major ramp in free cash flow in ’22/’23, a trend we expect to continue ‘24” and beyond.
Another Netflix stock price boost, by $100 to $450, came on July 10 from Morgan Stanley analyst Benjamin Swinburne. “We are bullish on the Netflix business as continued execution, competitor withdrawal and disciplined expense trends increase our outlook,” he explained.
That said, he maintained his “equal-weight” rating on the stock, highlighting: “On a 12-month view, however, there may be more risk of multiple compression from here than multiple expansion and we wait for a better entry point.” Explained Swinburne: “A year ago, nothing was priced in for either paid sharing or the ad-tier as shares traded at about 13 times estimated 2024 consensus earnings per share. Today, at about 30 times, much is expected.”
But the expert also emphasized the bull case. “Netflix is poised to demonstrate how good a business streaming can be at scale,” he wrote. “The combination of accelerating revenue against limited expense
growth is set to improve returns.”
Meanwhile, Goldman Sachs analyst Eric Sheridan, in a July 4 report, upgraded Netflix from “sell” to “neutral” and boosted his stock price target from $230 to $400. “Strategic Initiatives Drive Operating Outperformance,” the former Netflix bear highlighted in the headline of his report, in which he also summarized: “Netflix continues to execute against its global password and ad tier initiatives.”
Sheridan noted that his “sell” recommendation had been based on the view that the global streaming giant “would face a series of headwinds from post-pandemic subscriber growth normalization, heightened industry competitive pressure, potential pressure on subscriber gross additions from the consumer spending environment and volatile subscriber performance as it rolled out its password sharing crackdown initiatives.”
But the Goldman expert likes what he has seen so far, writing: “In short, Netflix management has executed its password sharing initiative in excess of our prior assumptions, has regained content creation momentum in a manner that has muted any post-pandemic growth headwinds and overall industry competition has become more muted (especially from traditional media companies) in the past six months.”
Sheridan concluded that his upgrade was needed “to reflect the overall positive current operating performance for Netflix and continued forward positive operating momentum into 2024/2025.”
The Goldman analyst forecast the streamer ending the second quarter with 236.0 million subscribers, up from the 232.5 million recorded as of the end of its first quarter. Overall, Netflix’s global subscribers total was 232.5 million at the end of its first quarter of 2023.
The most recent bullish Netflix analyst report came out on Friday. In it, Wedbush Securities analyst Michael Pachter, who has an “outperform” rating and $485 stock price target on Netflix, cited positive takeaways from a survey that his team commissioned that he said should support his bullish thesis. “Netflix remains on Wedbush’s Best Ideas list, given our view that the company can generate significantly more free cash flow than its guidance suggests,” he explained. “We think Netflix has reached the right formula with its global content to balance costs and generate increasing profitability. At the same time, its ad-supported tier and password sharing crackdown should further boost cash generation.”
Speaking of those initiatives, Wedbush commissioned a streaming-focused survey by Momentive in July to track trends in the second and going into the third quarter. Among the takeaways were “improved awareness and uptake of Netflix’s advertising subscription tier” and “a positive overall reception to Netflix’s password-sharing crackdown,” Pachter highlighted. His conclusion: “As such, we think Netflix’s second-quarter earnings results will meet or exceed Street expectations, and we expect shares to rise.”
wabbott
DIS Veteran
- Joined
- Aug 4, 2021
Looks like some buyers have shown up.
https://finance.yahoo.com/quote/DIS?p=DIS
DIS: 87.14+1.58 (+1.85%)
As of 09:52AM EDT. Market open.
https://finance.yahoo.com/quote/DIS?p=DIS
DIS: 87.14+1.58 (+1.85%)
As of 09:52AM EDT. Market open.
clarker99
DIS Veteran
- Joined
- May 15, 2019
For those interested, here is an estimate of how much each ship earned for DCL based on FY2019, which was DCL's last 'normal' year before the pandemic. I have also added in the Wish to try and give us a guess on what FY23 may look like.
all numbers in millions
The Wish will only contribute approx $130m in Operating income to $DIS. That is a rounding error for a company of Disney's size but we know this is just the 1st ship of the 4-ship expansion plan for DCL
They have 3 more ships coming in the future. 2 are the same capacity as the Wish/Dream/Fantasy and one is a mega sized 6000 capacity ship which is planned for Asian market (i think).
I am not 100% sure of all the timelines but in approx 5 years (and assuming normal cruising can happen) DCL should contribute approx $1b in operating income to DPEP (approx $600m more than 2019).
Jwaire
DIS Veteran
- Joined
- Sep 17, 2020
Well, we know they're at least all in on the Treasure and the final Wish-class ship (Tomorrowland? Frontierland?). Then there's the ugly bargain bin Chinese ship they just purchased. They released some theming info about the Treasure this morning.
I've never considered a Disney cruise (seems expensive/too many kids), but the Adventureland theming for the Treasure is right up my alley—Aladdin, Haunted Mansion, Peter Pan.
Last edited:
HokieRaven5
DIS Veteran
- Joined
- Mar 5, 2020
Treasure is still 2024, “Global Dream” (It will get a different name in time) is 2025, and Wish Class Ship #3 is also still currently slated for delivery in 2025 by Meyer Werft.
Elijah Abrams
Mouseketeer
- Joined
- Feb 6, 2020
I can think up a few names for the "Global Dream" and the 3rd Wish Class ships: Disney Imagination? Disney Believe?
wabbott
DIS Veteran
- Joined
- Aug 4, 2021
https://edition.cnn.com/2023/07/18/media/bob-iger-disney-reliable-sources/index.html
Bob Iger moves to calm Disney staff after sparking ‘high anxiety’ over potential sale of TV assets
By Oliver Darcy, CNN
Published 9:59 PM EDT, Tue July 18, 2023
Bob Iger is seeking to reassure an anxious arm of Disney’s business.
In an off-site meeting on Tuesday, the Disney chief executive spoke to senior leaders of the company’s television businesses, CNN has learned. The meeting came just days after Iger made decidedly candid remarks to CNBC’s David Faber in which he said Disney’s linear business “may not be core” to the entertainment giant — a comment that immediately sent shockwaves through the industry.
The admission to Faber naturally set off alarm bells inside Disney General Entertainment Content, the division of the Magic Kingdom that houses its linear business and operates quintessential broadcast and cable networks such as ABC, the Disney Channel, National Geographic, and FX.
Employees in the sizable division (there are thousands and thousands of employees who work for DGEC) have been experiencing “high anxiety,” sources noted to me, with them adding that Iger had effectively left staff “in the dark” by not communicating directly with them since the stunning interview. There have been no company-wide memos. No town halls. Nothing but silence since Iger jolted the organization with the news.
The chief executive on Tuesday sought to quell some of this unease as he fielded questions submitted by senior company leaders assembled at the off-site. He told the personnel gathered that the content created by the company’s television production teams is “incredibly valuable to our business,” according to a person with knowledge of his remarks.
And Iger talked up the importance of ABC News: “I’m ridiculously passionate about news,” Iger said, according to the person familiar with his comments. “It’s important to this company. We need to figure out how it makes the transition into streaming. And I happen to believe we will endure. It’s too good, it’s too important, and it’s really fun.”
Of course, those comments are unlikely to entirely calm the rattled nerves of those working in Disney’s television businesses. While Iger did not explicitly tell Faber that he wanted to sell the linear stations and networks, he effectively put that sector of the business on the market with his comments.
Expressing passion for the news does not solve for that. No one has ever doubted Iger’s love for the news business. And it comes as no surprise that Iger believes the content produced by the television production teams holds incredible value.
The important question is — and always has been — whether the linear television businesses are crucial to Disney, particularly as Iger positions the company for the future. Iger has already answered that — and candidly so. “They may not be core to Disney,” he openly told Faber.
As one Disney insider told me on Tuesday, Iger’s remarks to senior leaders were “the usual jewel in the crown stuff — except now we know that he’s selling the jewel.”
“It’s great to say he loves the jewel. It’s great to say that the jewel is important. It’s great to say that the jewel is fun,” the Disney insider said. “But he has revealed the truth: he wants to get the highest price he can for the jewel because he can’t afford it anymore.”
Bob Iger moves to calm Disney staff after sparking ‘high anxiety’ over potential sale of TV assets
By Oliver Darcy, CNN
Published 9:59 PM EDT, Tue July 18, 2023
Bob Iger is seeking to reassure an anxious arm of Disney’s business.
In an off-site meeting on Tuesday, the Disney chief executive spoke to senior leaders of the company’s television businesses, CNN has learned. The meeting came just days after Iger made decidedly candid remarks to CNBC’s David Faber in which he said Disney’s linear business “may not be core” to the entertainment giant — a comment that immediately sent shockwaves through the industry.
The admission to Faber naturally set off alarm bells inside Disney General Entertainment Content, the division of the Magic Kingdom that houses its linear business and operates quintessential broadcast and cable networks such as ABC, the Disney Channel, National Geographic, and FX.
Employees in the sizable division (there are thousands and thousands of employees who work for DGEC) have been experiencing “high anxiety,” sources noted to me, with them adding that Iger had effectively left staff “in the dark” by not communicating directly with them since the stunning interview. There have been no company-wide memos. No town halls. Nothing but silence since Iger jolted the organization with the news.
The chief executive on Tuesday sought to quell some of this unease as he fielded questions submitted by senior company leaders assembled at the off-site. He told the personnel gathered that the content created by the company’s television production teams is “incredibly valuable to our business,” according to a person with knowledge of his remarks.
And Iger talked up the importance of ABC News: “I’m ridiculously passionate about news,” Iger said, according to the person familiar with his comments. “It’s important to this company. We need to figure out how it makes the transition into streaming. And I happen to believe we will endure. It’s too good, it’s too important, and it’s really fun.”
Of course, those comments are unlikely to entirely calm the rattled nerves of those working in Disney’s television businesses. While Iger did not explicitly tell Faber that he wanted to sell the linear stations and networks, he effectively put that sector of the business on the market with his comments.
Expressing passion for the news does not solve for that. No one has ever doubted Iger’s love for the news business. And it comes as no surprise that Iger believes the content produced by the television production teams holds incredible value.
The important question is — and always has been — whether the linear television businesses are crucial to Disney, particularly as Iger positions the company for the future. Iger has already answered that — and candidly so. “They may not be core to Disney,” he openly told Faber.
As one Disney insider told me on Tuesday, Iger’s remarks to senior leaders were “the usual jewel in the crown stuff — except now we know that he’s selling the jewel.”
“It’s great to say he loves the jewel. It’s great to say that the jewel is important. It’s great to say that the jewel is fun,” the Disney insider said. “But he has revealed the truth: he wants to get the highest price he can for the jewel because he can’t afford it anymore.”
Jwaire
DIS Veteran
- Joined
- Sep 17, 2020
I was digging through Disney's dead trademarks and they do own Imagination. Apparently, it was just a fragrance diffuser product sold at the Disney Store back in the day along with Fantasy and Wonder. Purely coincidence I'm sure, but fun nevertheless. The Wish was rumored to be called Enchantment for awhile.
He's become the Disney villain of the writer and actor strike with members specifically targeting him on Twitter and discussing his salary and how out of touch he is in multiple interviews.
ABC has some bright spots like GMA. Why give your top tier talent a reason to entertain other offers from competing networks? Nothing motivates people more than having your CEO put you on the auction block.
That CNBC interview will go down as one of Iger's biggest blunders.
wabbott
DIS Veteran
- Joined
- Aug 4, 2021
It's intriguing to me that he scheduled the interview BEFORE his contract extension was announced. As far as him, or any other high profile CEO staying quiet, it just won't happen. Human nature is pretty constant throughout history. The hubris that is required for one to reach the upper pinnacle of a profession or trade, is the same hubris that will prevent that same person from taking advice or criticism once that success is achieved.
wabbott
DIS Veteran
- Joined
- Aug 4, 2021
Looks like CMCSA is getting its share of bad pub, too.
WGA/SAG File Federal Complaint Over Construction Outside NBCUniversal; City Controller Investigating Trimmed Ficus Trees
By Lynette Rice, David Robb
July 18, 2023 6:20pm PDT
Treegate just became a thing.
City Controller Kenneth Mejia has vowed to look into the newly pruned Ficus trees outside of Universal’s Gate 8, after picketers drew attention to their thinned branches while marching in 90-degree-plus heat. Pine trees on the opposite side of Barham weren’t touched, and neither were a row of pepper trees behind the Universal fence near the production gate.
In a series of Tweets Tuesday, Mejia said his office is investigating what happened to the Ficuses on Burham Boulevard, which he said are “LA City managed street trees.” WGA picketers drew attention to their thinned out ranks on Monday. Universal owned up to trimming them but said in a statement it was done for “safety reasons” though it “has created unintended challenges for demonstrators, that was not our intention.”
“Trees are essential to providing Angelenos with significant environmental and public health benefits, especially during a heatwave,” Mejia said in a tweet. “Public Works’ Bureau of Street Services (StreetsLA) is responsible for maintaining the City’s 700,000+ trees in the public right-of-way.”
He went on to say in a thread that “code enforcement for street trees (including the pruning or removal of trees without a permit) is the responsibility of the StreetsLA Investigation and Enforcement Division. Violations can result in code enforcement citations.”
Separately, the fight over the studio’s construction on Lankershim Boulevard and its impact on the ongoing strike just got even bigger: The WGA and SAG-AFTRA today filed a complaint with the National Labor Relations Board over the lack of safe pathways available for union members to picket.
“Within the past six months, [NBCUniversal Media] has interfered with, coerced, and restrained employees in the exercise of their rights under Section 7 of the [National Labor Relations] Act,” the Writers Guild of America, West, said in its filing (read it here).
Said interference includes but is not limited to “interfering with lawful picketing activity by designating as picketing locations areas where the public sidewalks have been covered up with construction fencing, forcing picketers to patrol in busy streets with significant car traffic where two picketers have already been struck by a car and by refusing to provide K-rail barriers to establish pedestrian walkways for picketers to use after Los Angeles Police Department advised the employer weeks ago in the interest of public safety to do so.”
In response, an NBCUniversal spokesperson released this statement today: “We are aware of the WGA and SAG-AFTRA complaints. We strongly believe that the company has fulfilled our legal obligations under the National Labor Relations Act (NLRA) and we will cooperate with respect to any inquiries by the National Labor Relations Board on this issue. While we understand the timing of our multi-year construction project has created challenges for demonstrators, we continue to work with public agencies to increase access. We support the unions’ rights to demonstrate safely.”
The WGAW filing also cited “the egregious and flagrant nature of the employer’s illegal conduct and the irreparable harm, including the threat of bodily harm, caused by the above-mentioned violations of the Act.”
WGA/SAG File Federal Complaint Over Construction Outside NBCUniversal; City Controller Investigating Trimmed Ficus Trees
By Lynette Rice, David Robb
July 18, 2023 6:20pm PDT
Treegate just became a thing.
City Controller Kenneth Mejia has vowed to look into the newly pruned Ficus trees outside of Universal’s Gate 8, after picketers drew attention to their thinned branches while marching in 90-degree-plus heat. Pine trees on the opposite side of Barham weren’t touched, and neither were a row of pepper trees behind the Universal fence near the production gate.
In a series of Tweets Tuesday, Mejia said his office is investigating what happened to the Ficuses on Burham Boulevard, which he said are “LA City managed street trees.” WGA picketers drew attention to their thinned out ranks on Monday. Universal owned up to trimming them but said in a statement it was done for “safety reasons” though it “has created unintended challenges for demonstrators, that was not our intention.”
“Trees are essential to providing Angelenos with significant environmental and public health benefits, especially during a heatwave,” Mejia said in a tweet. “Public Works’ Bureau of Street Services (StreetsLA) is responsible for maintaining the City’s 700,000+ trees in the public right-of-way.”
He went on to say in a thread that “code enforcement for street trees (including the pruning or removal of trees without a permit) is the responsibility of the StreetsLA Investigation and Enforcement Division. Violations can result in code enforcement citations.”
Separately, the fight over the studio’s construction on Lankershim Boulevard and its impact on the ongoing strike just got even bigger: The WGA and SAG-AFTRA today filed a complaint with the National Labor Relations Board over the lack of safe pathways available for union members to picket.
“Within the past six months, [NBCUniversal Media] has interfered with, coerced, and restrained employees in the exercise of their rights under Section 7 of the [National Labor Relations] Act,” the Writers Guild of America, West, said in its filing (read it here).
Said interference includes but is not limited to “interfering with lawful picketing activity by designating as picketing locations areas where the public sidewalks have been covered up with construction fencing, forcing picketers to patrol in busy streets with significant car traffic where two picketers have already been struck by a car and by refusing to provide K-rail barriers to establish pedestrian walkways for picketers to use after Los Angeles Police Department advised the employer weeks ago in the interest of public safety to do so.”
In response, an NBCUniversal spokesperson released this statement today: “We are aware of the WGA and SAG-AFTRA complaints. We strongly believe that the company has fulfilled our legal obligations under the National Labor Relations Act (NLRA) and we will cooperate with respect to any inquiries by the National Labor Relations Board on this issue. While we understand the timing of our multi-year construction project has created challenges for demonstrators, we continue to work with public agencies to increase access. We support the unions’ rights to demonstrate safely.”
The WGAW filing also cited “the egregious and flagrant nature of the employer’s illegal conduct and the irreparable harm, including the threat of bodily harm, caused by the above-mentioned violations of the Act.”
wabbott
DIS Veteran
- Joined
- Aug 4, 2021
https://www.businesswire.com/news/home/20230718353858/en/
Alexia Quadrani Promoted to Executive Vice President, Investor Relations for The Walt Disney Company
July 18, 2023 05:00 PM Eastern Daylight Time
BURBANK, Calif.--(BUSINESS WIRE)--The Walt Disney Company (NYSE: DIS) today announced that Alexia Quadrani has been promoted to the role of Executive Vice President, Investor Relations for the company. Quadrani most recently served as Disney’s Senior Vice President, Investor Relations.
Quadrani will continue to serve as Disney’s primary information liaison to the global investment community, while working as a key advisor and resource to the company’s senior management team. Quadrani’s responsibilities include expanding the company’s relationships with sell-side and buy-side investment analysts, industry analysts, and investors worldwide; providing input on the company’s financial reporting activities; managing stock share administration; and leading ongoing engagement with the governance community and Environmental, Social, and Governance (ESG) focused investors.
Prior to joining Disney last year, Quadrani served as Managing Director and Senior Analyst, U.S. Media Equity Research at J.P. Morgan for 14 years. Her coverage included entertainment, advertising and video game stocks. Quadrani joined J.P. Morgan in 2008 through its merger with Bear Stearns, where she had served as Senior Managing Director since 1997. She was an Institutional Investor-ranked analyst for more than 20 years.
Quadrani holds an MBA in finance from New York University’s Stern School of Business and a BS from the School of Foreign Service at Georgetown University.
Alexia Quadrani Promoted to Executive Vice President, Investor Relations for The Walt Disney Company
July 18, 2023 05:00 PM Eastern Daylight Time
BURBANK, Calif.--(BUSINESS WIRE)--The Walt Disney Company (NYSE: DIS) today announced that Alexia Quadrani has been promoted to the role of Executive Vice President, Investor Relations for the company. Quadrani most recently served as Disney’s Senior Vice President, Investor Relations.
Quadrani will continue to serve as Disney’s primary information liaison to the global investment community, while working as a key advisor and resource to the company’s senior management team. Quadrani’s responsibilities include expanding the company’s relationships with sell-side and buy-side investment analysts, industry analysts, and investors worldwide; providing input on the company’s financial reporting activities; managing stock share administration; and leading ongoing engagement with the governance community and Environmental, Social, and Governance (ESG) focused investors.
Prior to joining Disney last year, Quadrani served as Managing Director and Senior Analyst, U.S. Media Equity Research at J.P. Morgan for 14 years. Her coverage included entertainment, advertising and video game stocks. Quadrani joined J.P. Morgan in 2008 through its merger with Bear Stearns, where she had served as Senior Managing Director since 1997. She was an Institutional Investor-ranked analyst for more than 20 years.
Quadrani holds an MBA in finance from New York University’s Stern School of Business and a BS from the School of Foreign Service at Georgetown University.
wabbott
DIS Veteran
- Joined
- Aug 4, 2021
https://www.nasdaq.com/articles/netflix-nflx-q2-2023-earnings-what-to-expect
Netflix (NFLX) Q2 2023 Earnings: What to Expect
Contributor
Richard Saintvilus
Jul 19, 2023 7:33AM EDT
Netflix (NFLX) stock has been one of the better performing names in large-cap tech, rising almost 60% year to date, including a 35% boost in the past six months, besting the 13% rise in the S&P 500 index. With its shares surging 155% in just twelve months, the market appears to be “all in” on the streaming giant’s growth momentum.
The streaming pioneer is set to report second quarter fiscal 2023 earnings results after the closing bell Wednesday. Investors who are on the sidelines want to know whether there still a buying opportunity. Citing "positive data" on the company's paid sharing initiatives, UBS analyst John Hodulik boosted his estimates on Netflix, saying not only does he expect accelerating second-half growth, he now expects Netflix’s Q2 results to come in above management's guidance for revenue and profits.
In the second and third-quarters, Hodulik now expects the company to add 3.6 million and 6.5 million paid subscribers, respectively. That’s up from prior estimates of 1.4 million and 3.6 million, respectively. While forecasting Netflix’s Q3 guidance to imply faster revenue and operating income growth, the analyst boosted his 12-month price target from $390 to $525 per share. Hodulik’s optimism is consistent with management’s expressed confidence in their growth strategy.
If you recall, in Netflix’s Q4 letter to shareholders, Netflix management said, "We believe we have a clear path to reaccelerate our revenue growth: continuing to improve all aspects of Netflix, launching paid sharing and building our ads offering.” Regarding the ad-supported tier, which was launched in twelve global markets in November, it exposes Netflix to an estimated $140 billion of brand advertising spending.
All told, the company’s growth initiatives, including implementing ways to crackdown on password sharing, are paying huge dividends. Armed with over 232.5 million global subscribers and a strong value proposition among cord-cutters, Netflix has shown it is a must-have product in the streaming space. Combined with its upcoming content launches, there is still a compelling case to remain invested in Netflix stock. These assumptions will be answered when Netflix issues its guidance forecast for the next quarter and full year.
For the quarter that ended June, Wall Street expects Netflix to earn $2.84 per share on revenue of $8.28 billion. This compares to the year-ago quarter when earnings were $3.20 per share on $7.97 billion in revenue. For the full year, ending December, Netflix’s earnings are projected to rise 12.26% year over year to $11.17 per share, while full-year revenue of $33.98 billion would mark an increase of 7.5% year over year.
Its management’s ability to leverage the company's first-mover advantage in the streaming space remains one of the key differentiators for Netflix over the likes of Disney+ (DIS), Hulu, Amazon’s (AMZN) Prime Video or Warner Bros. Discovery's (WBD) Max and others. With over 232.5 million subscribers and profitable, Netflix no longer has to spend to focus on ways to acquire paying viewers, it can execute its growth strategy.
The company has done a solid job executing on the most-pressing ones, particularly the advertising-supported tier, according to Macquarie analyst Tim Nollen who on Thursday raised his price target to $410 from $350. Nollen is nonetheless cautious amid reports of consumers cutting back on streaming video services. Netflix did feel some of the pressure in Q1 with revenues rising 3.7% year over year to $8.16 billion, but narrowly missing analyst consensus estimates. Q1 adjusted EPS was $2.88 per share beat by a penny.
Meanwhile, average paid subscribers rose 4% year over year by 1.75 million, beating analyst forecasts for 1.38 million. The stock has already responded to these results. So, on Wednesday, to keep Netflix stock on its trajectory, beyond a top- and bottom-line beat, the company will need to issue strong guidance for the next quarter and full year.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Netflix (NFLX) Q2 2023 Earnings: What to Expect
Contributor
Richard Saintvilus
Jul 19, 2023 7:33AM EDT
Netflix (NFLX) stock has been one of the better performing names in large-cap tech, rising almost 60% year to date, including a 35% boost in the past six months, besting the 13% rise in the S&P 500 index. With its shares surging 155% in just twelve months, the market appears to be “all in” on the streaming giant’s growth momentum.
The streaming pioneer is set to report second quarter fiscal 2023 earnings results after the closing bell Wednesday. Investors who are on the sidelines want to know whether there still a buying opportunity. Citing "positive data" on the company's paid sharing initiatives, UBS analyst John Hodulik boosted his estimates on Netflix, saying not only does he expect accelerating second-half growth, he now expects Netflix’s Q2 results to come in above management's guidance for revenue and profits.
In the second and third-quarters, Hodulik now expects the company to add 3.6 million and 6.5 million paid subscribers, respectively. That’s up from prior estimates of 1.4 million and 3.6 million, respectively. While forecasting Netflix’s Q3 guidance to imply faster revenue and operating income growth, the analyst boosted his 12-month price target from $390 to $525 per share. Hodulik’s optimism is consistent with management’s expressed confidence in their growth strategy.
If you recall, in Netflix’s Q4 letter to shareholders, Netflix management said, "We believe we have a clear path to reaccelerate our revenue growth: continuing to improve all aspects of Netflix, launching paid sharing and building our ads offering.” Regarding the ad-supported tier, which was launched in twelve global markets in November, it exposes Netflix to an estimated $140 billion of brand advertising spending.
All told, the company’s growth initiatives, including implementing ways to crackdown on password sharing, are paying huge dividends. Armed with over 232.5 million global subscribers and a strong value proposition among cord-cutters, Netflix has shown it is a must-have product in the streaming space. Combined with its upcoming content launches, there is still a compelling case to remain invested in Netflix stock. These assumptions will be answered when Netflix issues its guidance forecast for the next quarter and full year.
For the quarter that ended June, Wall Street expects Netflix to earn $2.84 per share on revenue of $8.28 billion. This compares to the year-ago quarter when earnings were $3.20 per share on $7.97 billion in revenue. For the full year, ending December, Netflix’s earnings are projected to rise 12.26% year over year to $11.17 per share, while full-year revenue of $33.98 billion would mark an increase of 7.5% year over year.
Its management’s ability to leverage the company's first-mover advantage in the streaming space remains one of the key differentiators for Netflix over the likes of Disney+ (DIS), Hulu, Amazon’s (AMZN) Prime Video or Warner Bros. Discovery's (WBD) Max and others. With over 232.5 million subscribers and profitable, Netflix no longer has to spend to focus on ways to acquire paying viewers, it can execute its growth strategy.
The company has done a solid job executing on the most-pressing ones, particularly the advertising-supported tier, according to Macquarie analyst Tim Nollen who on Thursday raised his price target to $410 from $350. Nollen is nonetheless cautious amid reports of consumers cutting back on streaming video services. Netflix did feel some of the pressure in Q1 with revenues rising 3.7% year over year to $8.16 billion, but narrowly missing analyst consensus estimates. Q1 adjusted EPS was $2.88 per share beat by a penny.
Meanwhile, average paid subscribers rose 4% year over year by 1.75 million, beating analyst forecasts for 1.38 million. The stock has already responded to these results. So, on Wednesday, to keep Netflix stock on its trajectory, beyond a top- and bottom-line beat, the company will need to issue strong guidance for the next quarter and full year.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
wabbott
DIS Veteran
- Joined
- Aug 4, 2021
So they can figure how to accurately price advertising sales?
https://variety.com/vip/studios-need-streaming-viewership-metric-to-end-strikes-1235672305/
July 18, 2023 6:00am PDT
Studios Need a Streaming Viewership Metric to End the Strikes
by Tyler Aquilina
With the performers of SAG-AFTRA now joining Hollywood writers on the picket lines, it’s clear that the ultimate resolution of this crisis will be decisive for the future of the entertainment industry and its workers. Whatever contracts are hammered out once bargaining between the guilds and the studios resumes will likely set the standard for Hollywood’s new compensation models going forward.
As VIP+ has argued, the paramount economic issue at stake here is streaming residual payments, which will form the backbone of entertainment industry workers’ compensation in the years to come. At the heart of this dispute is streamers’ reluctance (to put it mildly) to share data quantifying viewership of content on their SVOD platforms; the studios have evidently refused to engage on the issue of success-based residuals for such content.
Under their now-expired agreements, SAG-AFTRA and WGA streaming residuals are calculated based on a service’s domestic subscriber totals, with a sliding scale of tiers determining the amount talent will be paid. Contractual residual bases are multiplied by the corresponding “subscriber tier” percentage as well as another percentage based on how many years it’s been since the content in question was released.
In other words, unlike the methods used to calculate TV residuals for decades, there is no accounting for the performance of hits in this model, and the studios are evidently unwilling to change that. The new contract the Directors Guild negotiated with the Alliance of Motion Picture and Television Producers (AMPTP) contained no provision for success-based residuals, instead simply increasing required payments and adding a new formula to better account for international subscribers.
Yet any subscriber-based formula already looks antiquated, given that subscriber totals are no longer the chief arbiter of success in the streaming business. And as that business continues to mature, basing residual payments on this metric will become less and less effective as a compensation model, as streaming transforms into a stable, long-term business supported largely by advertising — transforms, in other words, into something more like television.
The bitter irony here is that studios clearly know they can’t keep a black box around streaming viewership data forever. All the major-studio SVODs now participate in Nielsen’s streaming ratings system, which measures only viewing on TV screens in the U.S., and are also actively exploring alternative ratings currencies to better measure viewership across all types of screens and platforms.
The larger issue, and perhaps an under-discussed contributor to the current unrest, is that despite the studios’ reticence to share their own data, there is also no standard third-party streaming viewership metric they can agree to utilize, and currently no simple number that quantifies the success of streaming content.
“There is not a good, consistent streaming metric of success for [SVOD] shows, and that is a huge problem,” Variety Senior TV Reporter Joe Otterson said during last week’s VIP+ webinar on the strikes. “If you say, ‘On Thursday night at 9:00, 10 million people tuned in to watch this show on CBS,’ people can wrap their minds around what that means in terms of the success of that show….But when you tell someone, ‘This show has been watched for 95 million hours since it was released two weeks ago’? I cannot wrap my mind [around] or contextualize exactly what that means.”
SAG-AFTRA reportedly attempted a compromise on this front, suggesting data from Parrot Analytics be used to calculate streaming content’s popularity and contribution to services’ revenues, a proposal the studios rejected.
However, this gets no closer to a true solution to the problem, as Parrot’s “demand” metric is a poor proxy for streaming viewership data to tie to residuals. There are too many factors at play in these scores — social media engagement, search engine activity, piracy — that reflect audience interest in a title but are not concretely tied to actual viewership on a streaming platform.
How, then, should the guilds and the AMPTP compromise? Perhaps the search for a third-party viewing metric for ad-supported content could be a bridge to measuring ad-free programming as well? Some of the studios this year launched a Joint Industry Committee to vet and certify new audience-measurement technologies for the purpose of establishing a standard currency for advertisers; if the studios want to reach a compromise to end the strikes, one would think they could invest in landing on a metric that would work for the guilds too.
The problem, however, is that the major players can’t even agree on what metrics to use, or even whether new metrics should be used at all: Disney and Netflix, for instance, plan on sticking with Nielsen and aren’t involved in the JIC. Meanwhile, the other studios are unhappy with Nielsen’s audience measurements (hence the search for new currencies), and likely wouldn’t agree to have any success metric tied to Nielsen data.
But the fact remains that a measurement system will, eventually, need to be agreed on. As noted, advertising will only become more important to the streaming business in the years ahead as subscriber totals continue to plateau, and advertisers will need a standardized streaming viewership metric to measure the reach and impact of their investments.
If this won’t crack open the doors of streamers’ own data vaults, it will at least shine a brighter light on streaming viewership, and weaken the studios’ case for keeping this data in the dark. Of course, the streamers would almost certainly prefer to keep data strictly shared with advertisers, but more data being shared means more potential for leakage, and again, would dilute the studios’ argument for keeping such data from the guilds.
In other words, we’re likely moving toward an era of greater data transparency whether the studios like it or not, and the guild negotiators would do well to keep that in mind when contract talks eventually restart.
https://variety.com/vip/studios-need-streaming-viewership-metric-to-end-strikes-1235672305/
July 18, 2023 6:00am PDT
Studios Need a Streaming Viewership Metric to End the Strikes
by Tyler Aquilina
With the performers of SAG-AFTRA now joining Hollywood writers on the picket lines, it’s clear that the ultimate resolution of this crisis will be decisive for the future of the entertainment industry and its workers. Whatever contracts are hammered out once bargaining between the guilds and the studios resumes will likely set the standard for Hollywood’s new compensation models going forward.
As VIP+ has argued, the paramount economic issue at stake here is streaming residual payments, which will form the backbone of entertainment industry workers’ compensation in the years to come. At the heart of this dispute is streamers’ reluctance (to put it mildly) to share data quantifying viewership of content on their SVOD platforms; the studios have evidently refused to engage on the issue of success-based residuals for such content.
Under their now-expired agreements, SAG-AFTRA and WGA streaming residuals are calculated based on a service’s domestic subscriber totals, with a sliding scale of tiers determining the amount talent will be paid. Contractual residual bases are multiplied by the corresponding “subscriber tier” percentage as well as another percentage based on how many years it’s been since the content in question was released.
In other words, unlike the methods used to calculate TV residuals for decades, there is no accounting for the performance of hits in this model, and the studios are evidently unwilling to change that. The new contract the Directors Guild negotiated with the Alliance of Motion Picture and Television Producers (AMPTP) contained no provision for success-based residuals, instead simply increasing required payments and adding a new formula to better account for international subscribers.
Yet any subscriber-based formula already looks antiquated, given that subscriber totals are no longer the chief arbiter of success in the streaming business. And as that business continues to mature, basing residual payments on this metric will become less and less effective as a compensation model, as streaming transforms into a stable, long-term business supported largely by advertising — transforms, in other words, into something more like television.
The bitter irony here is that studios clearly know they can’t keep a black box around streaming viewership data forever. All the major-studio SVODs now participate in Nielsen’s streaming ratings system, which measures only viewing on TV screens in the U.S., and are also actively exploring alternative ratings currencies to better measure viewership across all types of screens and platforms.
The larger issue, and perhaps an under-discussed contributor to the current unrest, is that despite the studios’ reticence to share their own data, there is also no standard third-party streaming viewership metric they can agree to utilize, and currently no simple number that quantifies the success of streaming content.
“There is not a good, consistent streaming metric of success for [SVOD] shows, and that is a huge problem,” Variety Senior TV Reporter Joe Otterson said during last week’s VIP+ webinar on the strikes. “If you say, ‘On Thursday night at 9:00, 10 million people tuned in to watch this show on CBS,’ people can wrap their minds around what that means in terms of the success of that show….But when you tell someone, ‘This show has been watched for 95 million hours since it was released two weeks ago’? I cannot wrap my mind [around] or contextualize exactly what that means.”
SAG-AFTRA reportedly attempted a compromise on this front, suggesting data from Parrot Analytics be used to calculate streaming content’s popularity and contribution to services’ revenues, a proposal the studios rejected.
However, this gets no closer to a true solution to the problem, as Parrot’s “demand” metric is a poor proxy for streaming viewership data to tie to residuals. There are too many factors at play in these scores — social media engagement, search engine activity, piracy — that reflect audience interest in a title but are not concretely tied to actual viewership on a streaming platform.
How, then, should the guilds and the AMPTP compromise? Perhaps the search for a third-party viewing metric for ad-supported content could be a bridge to measuring ad-free programming as well? Some of the studios this year launched a Joint Industry Committee to vet and certify new audience-measurement technologies for the purpose of establishing a standard currency for advertisers; if the studios want to reach a compromise to end the strikes, one would think they could invest in landing on a metric that would work for the guilds too.
The problem, however, is that the major players can’t even agree on what metrics to use, or even whether new metrics should be used at all: Disney and Netflix, for instance, plan on sticking with Nielsen and aren’t involved in the JIC. Meanwhile, the other studios are unhappy with Nielsen’s audience measurements (hence the search for new currencies), and likely wouldn’t agree to have any success metric tied to Nielsen data.
But the fact remains that a measurement system will, eventually, need to be agreed on. As noted, advertising will only become more important to the streaming business in the years ahead as subscriber totals continue to plateau, and advertisers will need a standardized streaming viewership metric to measure the reach and impact of their investments.
If this won’t crack open the doors of streamers’ own data vaults, it will at least shine a brighter light on streaming viewership, and weaken the studios’ case for keeping this data in the dark. Of course, the streamers would almost certainly prefer to keep data strictly shared with advertisers, but more data being shared means more potential for leakage, and again, would dilute the studios’ argument for keeping such data from the guilds.
In other words, we’re likely moving toward an era of greater data transparency whether the studios like it or not, and the guild negotiators would do well to keep that in mind when contract talks eventually restart.
wabbott
DIS Veteran
- Joined
- Aug 4, 2021
https://www.hollywoodreporter.com/b...ls-basic-plan-us-advertising-push-1235539481/
Netflix Removes “Basic” Ad-Free Plan in U.S. and U.K.
The company had previously removed the tier in Canada. Now the $10 per month plan in the U.S. is gone as well.
July 19, 2023 6:32am PDT
by Alex Weprin
Netflix has removed its $9.99 advertising-free “Basic” plan in the U.S. and U.K., a move that would push new subscribers to sign up for more lucrative subscription options for the streaming giant.
A visit to Netflix’s sign-up page Wednesday morning showed only three options for new subscribers: Its $6.99 “Standard with Ads” tier, $15.49 “Standard” plan, and $19.99 “Premium” plan, which both are ad-free.
In an FAQ on its sign-up page, the company wrote that “the Basic plan is no longer available for new or rejoining members. If you are currently on the Basic plan, you can remain on this plan until you change plans or cancel your account.”
In other words, for current Basic plan subscribers, they can keep that plan for now, with the new changes only applying to new or returning subs.
A Netflix spokesperson declined to comment.
Netflix executives have said the ad tier already draws higher revenue per subscriber
than its standard tier, though they have added they are neutral about what tier users choose to subscribe to. The elimination of the Basic tier will push new users to either the ad-supported plan or the standard plan, which is more than doubble the price of the ad plan.
The elimination of the Basic plan in the U.S. comes a month after the company made the same move in Canada.
Netflix’s advertising tier, which launched as “Basic with Ads” late last year, now has “nearly 5 million” monthly active users, the company said at its inaugural upfront advertising presentation in May. Active users is not the same as subscribers (presumably, one subscription can have multiple users) but it is a step in that direction.
The company also said that engagement on its ad plan is similar to its ad-free plans, a critical piece of data as the more time users spend with a service, the more advertising revenue it can drive.
Netflix is scheduled to report earnings after the market close on Wednesday afternoon.
Netflix Removes “Basic” Ad-Free Plan in U.S. and U.K.
The company had previously removed the tier in Canada. Now the $10 per month plan in the U.S. is gone as well.
July 19, 2023 6:32am PDT
by Alex Weprin
Netflix has removed its $9.99 advertising-free “Basic” plan in the U.S. and U.K., a move that would push new subscribers to sign up for more lucrative subscription options for the streaming giant.
A visit to Netflix’s sign-up page Wednesday morning showed only three options for new subscribers: Its $6.99 “Standard with Ads” tier, $15.49 “Standard” plan, and $19.99 “Premium” plan, which both are ad-free.
In an FAQ on its sign-up page, the company wrote that “the Basic plan is no longer available for new or rejoining members. If you are currently on the Basic plan, you can remain on this plan until you change plans or cancel your account.”
In other words, for current Basic plan subscribers, they can keep that plan for now, with the new changes only applying to new or returning subs.
A Netflix spokesperson declined to comment.
Netflix executives have said the ad tier already draws higher revenue per subscriber
than its standard tier, though they have added they are neutral about what tier users choose to subscribe to. The elimination of the Basic tier will push new users to either the ad-supported plan or the standard plan, which is more than doubble the price of the ad plan.
The elimination of the Basic plan in the U.S. comes a month after the company made the same move in Canada.
Netflix’s advertising tier, which launched as “Basic with Ads” late last year, now has “nearly 5 million” monthly active users, the company said at its inaugural upfront advertising presentation in May. Active users is not the same as subscribers (presumably, one subscription can have multiple users) but it is a step in that direction.
The company also said that engagement on its ad plan is similar to its ad-free plans, a critical piece of data as the more time users spend with a service, the more advertising revenue it can drive.
Netflix is scheduled to report earnings after the market close on Wednesday afternoon.
So everyone is raising prices just as new show inventory will decline greatly with the strikes. This is not a recipe for success for any streamer.
They may lose a whole bunch of subs who just never come back. If there's nothing new to watch, might as well just watch FAST and once they get used to that free option, winning them back will be very hard.
Now if FAST does grow quickly, guess who has increased eyeballs? ABC and many of the other cable networks Disney owns. Hmm, another variable thrown in the mix...
They may lose a whole bunch of subs who just never come back. If there's nothing new to watch, might as well just watch FAST and once they get used to that free option, winning them back will be very hard.
Now if FAST does grow quickly, guess who has increased eyeballs? ABC and many of the other cable networks Disney owns. Hmm, another variable thrown in the mix...
middlechild
Mouseketeer
- Joined
- Nov 4, 2013
Looking at my Disney DVD collection of movies covering the 70 years of classics, from 20,000 Leagues to Pirates makes me very happy that these great films are mine to watch at any time. Share with the family too. Make a movie night of Pollyanna and or Old Yeller. Do not depend on streaming services to keep old films available at a reasonable cost.
wabbott
DIS Veteran
- Joined
- Aug 4, 2021
LOL. I have a bunch of them on VHS, and they still work.
mom2rtk
Invented the term "Characterpalooza"
- Joined
- Aug 23, 2008
Exactly what I do.
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Let us help you with your next Disney Vacation!
