The Dan Rayburn Podcast
The Dan Rayburn Podcast
Episode 68: The Implosion of The Pay TV Market as Blackouts, Increasing Carriage Fees and Cord Cutting Destroy Legacy Business Models
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This week, we detail how the current model of licensing broadcast networks to pay TV distributors is completely broken. With a recent blackout on Spectrum due to a licensing dispute with Disney and a current blackout on DISH due to their dispute with Hearst, the methodology for valuing content needs to change. We discuss what consumers want from streaming services, how they want to aggregate them, which business models work best, and the ridiculous fragmentation fans experience when watching sports-related content.
We also highlight the recently announced layoffs at Roku and Nielsen, as well as the new financial numbers from Warner Bros. Discovery, Netflix and others tied to revenue and free cash flow, due to the impact of the SAG-AFTRA and WGA strikes.
Podcast produced by Security Halt Media
Welcome to this week's edition of the Dan Rayburn podcast , the show that curates the streaming media industry news that matters most , unvarnished , unscripted and providing you with the factual data you need to know , without any of the hype , the pulse of the streaming media industry .
Speaker 2Welcome to the Dan Rayburn podcast . I am Dan Rayburn , along with co-host Mark Donaghan . Mark , hello . Are you ready , Mark ? Today ?
Speaker 3I am ready .
Speaker 2Talk about the insanity that is happening , insanity .
Speaker 3We are here to talk about insanity , dan it really is .
Speaker 2The entire media market is melting down . I don't know what these executives are thinking , and it reminds me , mark , of the days during COVID when you had executives that said , well , this is a new norm and no one will ever go back in person to anything again . It's just so disconnected with reality . So there is so much going on just literally in the last 24 hours but in the last week , that we're going to cover , and it all comes down to packaging and distribution and licensing of content . That's what this entire debate is about .
Speaker 2So the bottom line is the current model of licensing broadcast networks to pay TV distributors is broken Full stop , end of story . Everybody's telling us that's the case , we know that , and yet you still have these companies like Disney . And now , new thing that just popped up on this Friday , september 8th , is Hearst . Hearst has pulled 37 of its network affiliates from Dish TV , and what's fascinating is Dish put out a press release and was extremely detailed , and what Dish said was our viewership on Dish TV for Hearst stations are declining . They have less content , but they want to charge us more money . Yeah Well , none of that makes any sense .
Speaker 1And I love this .
Speaker 2At the same time , dish is saying and this is totally fair is that companies like Hearst and Disney are devaluing their product because they're making programming available elsewhere and they're competing against the same companies they're licensing the content to . So the whole debate between Disney and Spectrum Charter one of the things Charter brought up was well , Disney has already told us publicly that they're going to go direct to consumer or the SPN Sure At some point . So why should we pay so much money for it when it's going to look so to us ? So what part of this business negotiation do these companies not understand ? I don't know . Yeah , it's insane .
Speaker 3Yeah , I don't get it either . The corollary I've sort of seen this play before and it's in the very , very early days of licensing content for VOD , you know , for what we call now just streaming . But and the issue was was you'd go to a studio ? Now I'm talking like just for point of reference , 2007 , 2008 . Well , that's like another lifetime ago . Mark , it is , it is . It seems like boy . It seems like there's something kind of similar playing out here , like Well , I think this is .
Speaker 2I think this is very different in the sense that when you have Spectrum , come out and say we will drop TV altogether because we can't make money at these rates .
Speaker 3Yeah , this is just a business decision . Yeah , that's what your distributors are saying . Yeah , of course .
Speaker 2So if the numbers don't work , the numbers don't work . And yet , at the same time you have Disney's and others saying well , you should still pay us what our content is worth . Now let's go into that . Your content is only worth what someone's willing to pay you . Hello .
Speaker 3Not what you think it's worth .
Speaker 2So it's shocking to me . Yeah , and maybe I shouldn't be shocked , but it's just , it's insane that dishes come out with this press release . Yeah , very clear , very concise . Hearst has come back with a rebuttal and says well , our content is worth a lot of money , we've invested a lot in it , so they should pay the rates we're asking . But they've come back and told you that the viewership is declining .
Speaker 3Yeah .
Speaker 2So there's such a big gap in difference of what these companies are doing and the current model does not work . So the companies that are pretending it's business as usual need to acknowledge that the terms need to change and the methodology of how they value content is not in their hands , it's in the distributors' hands . It's in the distributors' hands .
Speaker 3But the bottom line for all of us .
Speaker 2It stinks for consumers .
Speaker 3Yeah , you know you're a diss subscriber and you can't watch what you want to watch .
Speaker 2You can't watch it now . Here's also what Hearst has said . This is just . I don't understand . This is insane . So Hearst says that it's not a blackout of what they're doing on Dish TV , because consumers can still get their hands quote over the air and from other cable operators what it's a blackout if you're on Dish .
Speaker 2Yeah , unless you go out and you get an antenna or you're going to switch overnight to a new pay TV provider who's probably bundled in with your internet service ? Yeah , what world do you live in ? So this is a mess . This is going to get real ugly . I would not be surprised if , at some point , because of the amount of these blackouts and restrictions out there , that the government gets involved somehow , which is the last thing we want involved .
Speaker 3Yeah , the last . Thing .
Speaker 2Because , the more consumers start complaining , what happens ? Politicians want to take on that , because they make it look like they're fighting for consumers , sure , sure .
Speaker 2So you also have blackouts because you have a dispute between direct TV and next star . Now next star owns affiliates in over 100 cities , which will prevent millions of direct TV users from watching the game after the two couldn't reach an agreement on retransmission fees in July . So where you go to get games , what it's available on when it's available , what the business model is , what you have to have to get it Amazing , I mean , mark , you and I do this every day and I'm still at times , confused like where do I go get that ?
Speaker 3Yeah , exactly , oh , I have to Google anymore . I just in fact , now that's almost become my Google is my auxiliary search engine . This happened just last night , dan , so my wife and I finished a series that we've been watching and we were , it's like okay , what do you want to watch next ? In my mind I had kind of a short list , but I , for the life of me , could not remember which platform this particular show was on and , by the way , sometimes they're moving too . So , even though six months ago it was licensed by , so I had to get up from the couch , go into my office , grab my phone , come back . I remember thinking this is insanity , like I'm sitting here , fully connected , I have all , like you , many , many , many of the services , and I had to go get Google and start searching . Yeah , you have no choice . You have no choice .
Speaker 2And then some content is not available in bars .
Speaker 1Apple TV Plus or even Friday Night Baseball . It's blocked out that way too .
Speaker 2No restaurant or bar near me knows what that is or how to get it . Now you also have a deal that came out today . When YouTube got the rights to NFL Sunday ticket , it told the NFL that it would not be able to make the service available in Puerto Rico or the Virgin Islands until at least November . So the NFL reached an agreement with Direct TV for them to offer Sunday NFL ticket , but then Google blocked it . Yeah , they blocked it . Now they've agreed on a deal as of today and a press release went out .
Speaker 2So it sounds like the bickering's over . So , residential satellite customers in Puerto Rico and Virgin Islands can now sign up for NFL Sunday ticket via Direct TV through the EverPass deal . Right , everpass already has the deal to bring it to commercial establishments . But here's the other thing . Mark and the company would give me an answer on this , nor did they put it in the press release . The companies have not said how long the deal is in place , so will it cover the entire season or will it only be until ?
Speaker 2YouTube is ready to offer streaming in those regions , because imagine , five weeks into the season , all of a sudden now you lose it on Direct TV .
Speaker 1Oh , yeah , yeah , yeah .
Speaker 2Yeah , so the amount of confusion .
Speaker 3So confusing .
Speaker 2They are forcing into the market , and I cannot wait until these companies continue to lose billions of dollars , until they start listening to customers , because they're not listening .
Speaker 3And there's an added layer of fan confusion . Now I don't know . Now I think , what I'm about to say it could go two ways . But all of these teams so you talk about like last night's game right Detroit Lions and Kansas City Chiefs Well , those guys for sure are in market , talking about holding conversations around D to C , building D to C , what it might look like , what they can do . So what's going to happen then when these teams then have an app and the content's available ? But obviously there's going to be potentially some restrictions even around that maybe .
Speaker 2So then these teams go on direct . Well , so NFL teams can . The NFL teams can , from what I understand , in terms of content .
Speaker 3And the NBA . The same situation , right , but to your point , you can in baseball and it's just , yeah , exactly , exactly so , you know . So the word insanity fits . And what really is just so sad in all of this is that everyone loses in this game the consumer , the fan loses , the subscribers lose , the content owners end up losing .
Speaker 2I mean , everyone loses , nobody is winning the only ones that are winning are the sports leagues .
Speaker 3Well , that's true .
Speaker 2They're winning because Google , right because Amazon because Apple have stepped forward .
Speaker 3Yep and given them so much money , huge checks yeah .
Speaker 2I read the other day , the number with the NFL is over $100 billion already in licensing and these deals are seven or 10 years long in some cases . So the sports leagues are the only ones who are making out here . That's it , and it wouldn't be the case . This entire industry would be different from a sports standpoint packaging distribution If we didn't have money flowing in from the technology giants . The licensing terms would be completely different , Completely different . Now , going back to just also the way this is playing out , Mark in the public view is incredible because on Instagram the other day I was getting ads from ESPN who was calling out spectrum and pushing spectrums users to live linear streaming services .
Speaker 3Yeah .
Speaker 2And it's like , wow , you're calling them out now in ads and telling them to just basically go somewhere else , while at the same time , the company you're calling out has said let them go somewhere else , we don't make money from this , so you may drop it all together . Yeah , so they're just not listening . They're not looking at the numbers . Now , I like what Cox is pushing back on . I'd like what spectrum is talking about , because what spectrum said was we sat with Disney and what we explained was we need to start offering different types of bundles . Yeah , consumers want different bundles . They want skinny bundles . We want to remove sports from some packages . We don't want to have to cut a deal with Disney where we have to take every single channel and we have to put it all together in a bundle , because that's not what consumers want .
Speaker 2Disney , of course , pushed back and said that's not realistic . Cox also wants to bundle in Disney's streaming services at no additional cost . However , okay , you got to push back for your Disney and go wait , so we're giving you all the digital stuff for free now . So that reminds me of when Peacock was free for Comcast subs I think it was just X1 subs and then , after doing that for a while it was like well , now we're not making money from that , so now we're going to have to charge Comcast subs ? Yeah , sure . So what they're talking about here the fundamental basics is the foundation of how we , as consumers , can package content across the distributors , but the distributors have no say in how they're allowed to package it . That's insane . So to add to more ridiculousness in the market for people who haven't heard , running through September 20th , disney is offering the basic ad tier of Disney Plus for $2 a month for 90 days , it's actually $1.99 .
Speaker 3Less than $2 . That's right If we're going to be technically accurate , and you're right .
Speaker 2Mark , I shouldn't round up that penny yeah don't round that up .
Speaker 2So $2.99 a month , only for three months . Now , disney talked a little bit in the media when they announced this . They also talked about what we're doing this because there's also a lot of great content that's coming out in the next few months , and they gave a list of all the different pieces of content . Well , what stops me from signing up for $1.99 a month for three months and then just turning off of it ? That's not an incentive to keep me . So what you now see these companies doing to try and get subscribers in , they're still losing money on those deals . So it is just absolutely insane . It's the wild west of what's taking place .
Speaker 2I think the entire fundamentals of how companies are valuing their content are wrong . I think the methodology they're using is wrong . Let's jump to the next one , mark with Tubi . Tubi put out a press release yeah , I put it up and I commented that you know these Tubi's numbers are pointless since they refuse to provide a definition of what a monthly active user is . So Tubi did finally get back to me and said well , we'll give you some details on background , but you're not allowed to quote us . Yeah , of course You're not allowed to use it and you can't give anyone any of the details You're like .
Speaker 1Well , so I politely declined and said no thanks , I'm not interested in talking to you , you're not willing to stand behind your methodology .
Speaker 2Now , previously Fox did once , after they acquired them , said a monthly active user in Tubi was anyone who opened the app . Yeah , okay , that's just not how anyone else would really think about it . Now they also called themselves the number one AVOD player , most watched free ad supported TV streaming service in the US . Sorry , they didn't . They said they called themselves that because they appeared on Nielsen's chart where they accounted for 1.4% of total viewing time . But YouTube on the chart shows up at 9.2% viewing time and Nielsen calls out that they're not including YouTube TV , which is paid . So how is Tubi number one free when YouTube is free as well ? I don't understand .
Speaker 3So the definition of AVOD , they're carving out a very specific you know , certain type of content ? Yeah , exactly , maybe you have to define that .
Speaker 2So we have no idea and you've got companies putting out there . You know , certainly with the Dish TV and the Hearst you know they're quoting each other saying , well , they're making quote unreasonable demands and we're quote negotiating in good faith . Like , just stop your numbers that you're working off of , don't make sense .
Speaker 3Yeah .
Speaker 2There has to be a business model here where companies can actually turn a profit . So incredible to see what these companies are doing and , frankly , I don't think they realize what the outcome is going to be , with consumers and the damage they're doing to their brands , especially when it comes to sports . Now let's throw just more fuel on the fire here , Mark . They're doing all of this during a strike . Yeah , exactly what are you people thinking ?
Speaker 2You know a D-strike by the way that impacts them , being able to produce the content that consumers consume To the point of where now some of the companies have come out publicly and given out different numbers of how it's going to impact their revenue , ad revenue and total costs of content licensing . Yeah , you're doing all this at the same time . So , as an example , warner Brothers now expects to exceed $1.5 billion in free cash flow for Q3 of 2023 because of the impact from strike-related factors . So it lowered its 2023 adjusted EBITDA to $10.5 billion to $11 billion . So that means they're already telling Wall Street we're going to make $300 to $500 million less money because of the strike . Now , at the same time , you can offset some of that , potentially because you're licensing less content .
Speaker 2Sure , okay , but what happens if this strike just continues here ? You're going to have less content . Why would consumers stay in your service and why would a churring go up and retention be harder when there's less content to watch ? So , on top of that , you are now also purposely removing sports content , the number one content we know keeps pay TV alive . You're purposely removing that , thinking what You're going to push consumers to now go watch VOD on a streaming service . Yeah , it's just doesn't make any rational sense whatsoever . So this is only going to get worse . We're only going to see more of this . We're starting to see companies aligned to one another . So once everything started happening with Spectrum , peacock I guess we should say Comcast or NBCU I don't know who cut the deal exactly , but Peacock and Spectrum are now offering current Spectrum TV customers a free year of Peacock premium Free .
Speaker 1Wow .
Speaker 2Now , if you already have Peacock , you have to cancel it and then re-sign up for a . Spectrum customer ? Yeah , so you can get it for free for a year if you're a Spectrum TV customer . If you're a Spectrum internet only customer , you can get it free for 90 days . Interesting , and we know Peacock has some live sports content . Yes , they do . So the way the companies are hitting back at one another is just . I don't ever remember seeing this in our space . When it comes to the content , side .
Speaker 3Yeah , so anyway , speaking of Peacock , what did you think of the game last night ? Quality and I know you put up some . I think it was basically stable for you , but any issues ?
Speaker 2Yeah , I had a few issues with ad triggering where the way the ads triggered all of a sudden you missed part of the plays .
Speaker 3Oh , that's interesting .
Speaker 1I didn't observe that .
Speaker 2I was on Twitter as you like to call X , but I'm still calling it Twitter and some of the message boards and Reddit and whatnot , and there definitely were hundreds of other people encountering the same thing . I stopped counting after about 300 . But how mass market is that ? Because we don't know how many we're watching . Yeah Right , that money only be 1% . I might have been in the 1% . You did have people sharing images of the app not being able to load 404 errors , but we have to expect that in any live event , you're going to have a percentage of the population where it's not going to work . Yeah , so overall , I thought it was okay there , definitely were some hiccups for me here or there .
Speaker 2Now that also could have been ISP related . I don't know if that's actually Verizon , and it can even be platform .
Speaker 3What do you remember ?
Speaker 2What TV ?
Speaker 3you were watching on .
Speaker 2Yeah , but I was using Amazon Fire TV Stick Max . Okay , so the best Fire Stick out there the most up to date , the best one , and it's all plugged into Ethernet .
Speaker 2Most everything home runs to my router , so plugged into Ethernet . What I was thinking , though , mark , is I was kind of laughing this last night . When you go online where there's a problem like this , or you follow these companies and social media , one of the first things they always say is restart your device . Yeah Right , and many times it does fix it , but why are you sticking with- ?
Speaker 3Exactly the thing is . A lot of times that is the issue restart your router .
Speaker 2Have you ever had to restart your TV to get your TV to work ? I actually have .
Speaker 3I have what you got ? A weird TV going on or something . I got Vizio .
Speaker 2I have one of the high-end models too , but it's plugged into a set-top box and , if you're using cable TV- . Well cable TV ISP combination has never said restart your TV to get . That's true , yeah , yeah . And that just goes to show , though , the huge technology difference between broadcast TV and streaming .
Speaker 3I Was having this conversation yesterday with somebody you know who's an architect for a very large Professional services company that you know builds out for all the media tech and you know all the pay TV companies . We , we both said at the same time we were talking about different , different set of issues . But you know , cable actually is an amazing user experience . Yes , it's super reliable it's , you know , and yes , we can laugh it . You know the user and of course , the user interfaces have gotten really good over the last you know 10 years or so with , you know , largely with Comcast pushing . You know RDK and others , you know so , but so that's improved .
Speaker 3But you know we can laugh at the user interface and laugh at some of the kind of archaic things . Elements you know like like . You know like quam segments , you know a lot of people in our industry don't know what I'm talking about , but you know like quam , what's that ? You know well , guess what ? It's ? Fixed guaranteed bandwidth to the home . That , unless , unless a backhoe cuts the cable , you know it's working and yeah , so it's .
Speaker 2You know , goes to show the differences and In the entire video stack here and we're gonna see so much of this . By the time people listen to this , we're already gonna have seen it , because in two days is NFL Sunday ticket . Youtube TV Right , and I don't care how perfect YouTube TV does it Sure gonna have percentage of users that are gonna have problems , sure , and that's just the reality . That is never going to change . Yeah but it starts with content , as we know .
Speaker 2We've got to have the right content on the right platform . It has to be easy to get to , easy to access . And and now , add on top of this mark the definitions that we're using as an industry . Some companies are vague , generic , high level , so we don't know . Some companies don't give out anything . Some companies are not listening to other partners who are saying we can't make money in this .
Speaker 2So , unless you change the numbers , we're just out , we're done . Yeah , we're out . Yeah , you should be . You should be right . You should not Subsidize us for consumers . And now you've got Nielsen . Let's go into Nielsen here . Yeah , so Nielsen is announced that it's gonna reduce its global workforce by about 9% , so that's a couple hundred people . They didn't disclose the number because they don't report publicly since going private . This is a second reduction in workforce since they were acquired by evergreen coast capital and Brookfield business partners in October of 2022 . Then , on top of that , nielsen has now walked back . They're planning to use first-party streaming data for live tele , streaming telecasts , which they were going to do with Amazon for Thursday night football .
Speaker 2Yeah , yeah so they're now saying , until that process that they want to do is approved by the MRC , which is the media rating council . Yeah , nielsen said it'll stay away from using first-party streaming data in its national TV ratings . So even the way we measure viewership on the internet , nobody can agree on . Yeah , some companies you know want to roll that out without being approved by the rating council . Yeah , it's , it's incredible , I feel like how many companies are Out in the market talking to the media , sitting at shows , saying , well , the the market has changed , video consumption has changed .
Speaker 2We know consumer habits have changed . We know there's different types fast , avat as fad right , there's . There's all this change taking place in the market . And then , when it comes to measurement and licensing , what do they do ? They fall back to what they've always been saying the same , yeah . So Nielsen's another one where it's like , oh , we're gonna do this . And then like enough people , complained advertisers and others that they're like , oh well , okay , maybe we won't do it now and we'll wait until it's approved . Well , why wouldn't you get it approved first ? Get the buy-in of your partners Instead of just making them mad . So the way companies are going about business these days Is , to me pretty incredible how they do lip service of like well our partners matter .
Speaker 3No , they don't .
Speaker 2Because you're rolling out stuff without even telling them and then when they go to the media and complain , then you're like , well , maybe we'll talk to them about that , maybe , yeah , so that is insane . Now let's , let's talk . Another crazy number here . Hmm , somebody I forget what article was and I don't blame the author for this put out an article saying that they're . They spoke to Disney and Disney said , because of what's going on with charter , that , uh , they are seeing a 60 percent Higher sign-up rate for hulu plus live tv Compared to their quote internal Expectations . Well , last quarter they lost a hundred thousand subscribers to hulu plus live tv and Pricing is going up from 69 99 to 76 99 on october 12th .
Speaker 2Yeah so for all we know their internal projections where we expect to turn people because the higher pricing and we lost a hundred thousand people last quarter , so we're hoping to only lose half as many .
Speaker 2Yeah , yeah , this quarter and that could still be your 60 percent and you're still losing subs quarter over quarter . On top of that , even if you have positive net new subs , that doesn't mean you're going to keep them . Yeah , so for listeners that don't know , right around about two and a half years ago , hulu came out independently of Disney and said we're no longer giving out numbers on Hulu Plus Live TV because too many people are turning it on and off throughout the year . Yeah , yeah .
Speaker 1And I love the fact that they set expectations .
Speaker 2Yeah , yeah , and so we already know that that's the way it works . So these numbers now that companies are throwing out , Now I think that's almost gotta be a little careful here , right , that could almost be even criminal , because that potentially sets expectations with Wall Street . And if you want to talk criminal listeners don't know . Disney is now being sued in multiple lawsuits . Of course , one of them is from Florida because , Florida is the only country that they do .
Speaker 2Basically different lawsuits claiming that Disney's boosted numbers and basically not given out the right projections as far as the growth of their business . So you now have all kinds of lawsuits as well from shareholders and others , just around how all of this is being reported . So why would somebody talk about a 60% number ?
Speaker 2Yeah , that's just not smart , it's not smart . So you wonder who some of these executives are . Who are these people that are still being allowed to make these decisions , so disconnected to reality ? Yeah , I don't get it . Now let's throw another one in here . Mark Roku announced it'll cut 10% of its workforce at 300 jobs . It's also gonna slow down its pace of hiring . This marks Roku's third round of layoffs in less than a year , because it cut 200 jobs in March and before that , 200 in November of last year . Now , when they announced it , their stock was up 8% that day , yeah , and investors liked it because Roku said that they're gonna reduce their year over year growth rate , not operating expenses . So from a balance sheet standpoint , that's a good thing . Now , interesting though , when it was digested , by the end of the day , roku was only up about 80 cents .
Speaker 2So they lost a lot of that by the end of the day . Now the company's also consolidated its office space . They're gonna do a strategic review of its content portfolio . So two things , mark , they have popped out to me . Aren't you always doing a strategic review of your office space and your content portfolio ? Right , aren't you always ? Because , especially COVID re-evaluating your office space , like , I don't think that's something new that Roku is doing , unless a lease came up , they didn't say Now they're also doing a quote strategic review of its content portfolio . Interesting enough , a couple of days after this came out , some news outlets were reporting that Roku has started removing content from their platform . Now the reason Roku is removing it is , they say , it's not driving new subscriber signups . Okay , then remove it . As a result , roku has said that they're gonna take a charge of the restructuring charge between 45 million and 65 million . Now that's also severance . It's benefit cause .
Speaker 2Yeah , exactly , there's cost when you there's cost . But incredible that companies are removing content from their platforms while at the same time raising rates , trying to charge more for distribution , with live not allowing us to do packaging . And let's add another thing we learned this week Warner Bros Discovery has already come out and said they can and will raise pricing next year . Now that's on top of Netflix telling us that they expect to raise pricing next year because they believe they can in the market . Yeah , so all of this taking place at the same time is a lot , and I'm not surprised so many people in the industry can't follow it all cause , frankly , just this week alone .
Speaker 3It is hard to keep track of . Really it's hard , it's really hard .
Speaker 2So this is about the future of video distribution . That's what we're talking about right here . Yeah , and that is going to change . And if it doesn't change and it will have to , it will have to , it'll have to we are going to see so many issues with consumers being so fed up . I love the fact that a professional tennis player and somebody very good I know nothing about tennis , but came out and told the media that he was watching illegal streams of the US Open . Yeah , because the hotel he was in in New York City he couldn't watch it . Yeah , yeah , right , that is your own , not even your fan . That's your own star .
Speaker 1Yeah .
Speaker 2Talking about . Well , I'll just go to a pirated stream . Yeah , yeah , exactly , exactly .
Speaker 3It tells us the state we're in right now . Yeah Boy , if I were in Comcast marketing or any of the pay TV , there's a tremendous campaign right now that they can run . You know that basically just anchors on Guess what . There's one remote that goes to one place that brings all your content together . No more searching , no more .
Speaker 2You know like it's , yeah , it's going to be interesting to see how it shakes out , though , in the live site Mark , because the problem is , even if you push everyone to live streaming linear services , there's not many out there . Many of them are lacking certain channels right , that's true . That's why it's available for the Mets here but not there .
Speaker 3Yeah , but that's true , many of them are now Blackouts $85 .
Speaker 2Yeah , so you're not necessarily saving money .
Speaker 3So you know , as we've talked about Well , but as all these services continue to increase their pricing , I think consumers , you know , I've always felt that , even though you know , and maybe we all should be doing this , but I think I'll speak for myself . You know I'm not sitting adding up exactly . Okay , here's how I suspend on Netflix . Here's Amazon . You know , go down the list , right , but everybody has this intuition of when your expenses in a category are it's just too much yeah .
Speaker 3It's just too much , you know . I mean , you know , either it's very easy to see in your checking account balance or whatever your credit card statement , or you just feel it . You just feel it and it doesn't mean , oh , I'm missing a meal because of it . It just means that you wake up one day and you go . I just think I'm spending too much . Every consumer has that , everyone does , regardless of where they are in the economic spectrum . And if more and more begin to wake up and feel , you know , that the way that they're consuming content with all these bespoke , all the card services platforms , is not making sense , I don't know . I don't know what they do , you know . I'm just positing that they're going to do something .
Speaker 2Yes , they are , they are and it's going to come down to the . This is all about the bundling too , because for those that don't know , you know the charter Disney thing is a big deal , because you know they've made it very clear internet is very profitable , tv is not , so we kind of already know that . Sure . But also when it comes to the contracts . Here most TV providers have contractual clauses that afford them the same carriage deals as their competitors .
Speaker 2Yeah , yeah , MFNs , If charter succeeds in breaking up basically their own bundles are offering now there is no way that doesn't reshape the pay TV business from a distribution licensing standpoint , and the fact that they are offering in day I mean charter a two month discount on Fugu TV for customers that don't want to wait to see if something happens with Disney they're already thinking about all right . Well , how can we make customers happy in the meantime ? Yeah , yeah , so we are in a different business realm than we were even two years ago . Yeah , that's true .
Speaker 2So they have to change what they're thinking here . Another one too is there was a tech conference this week , mark , so Paramount . They also came out and said that they expect to raise rates next year as well . Mm-hmm For streaming services Sure . So we've got a broken ecosystem . We've got licensing terms that don't make sense . We've got companies losing money both on the D to C side Disney , streaming . We've got companies that are either losing money or not making a lot of profit on pay TV spectrum charter .
Speaker 2Yep , these guys need to figure out how much money realistically can they make . Should they make what content is worth ? And it's all gonna come back down to how we want to buy it as consumers , and we've never had a lot of say in that . Yeah , but we will go going forward . I believe not on the sports side again , because attack companies have kept us from doing that . Hmm , I mean major league baseball . If I could sit with their execs , I would tell them I watch fewer games now because the licensing deals you have done Fewer . Oh , it's on it's Friday night , that's twice a month , whatever . And you know Apple TV plot . I just won't watch the game , I Just won't watch it . I'll go watch something else right now , yeah , is that what they're trying to do ? Push the fan away ? No , but yeah , what they're gonna say is well , we're still making more money anyway .
Speaker 2And or well , because it's an Apple TV , like we're getting a younger fan base . No , you're not , yeah , and you haven't cut a distribution deal for people to see it in a bar restaurant and it's only available on Friday night , which is a night a lot of people are gonna go to watch it .
Speaker 2Yeah so it's literally as if these companies do not understand who we are as fans , as consumers , how we watch content when we want to watch it . Hmm , they , they literally have their heads in the sand and they're still operating In a business environment with business metrics and terms that don't exist in the world we're in today . So this is gonna be there's gonna be fun to watch Fun is one way to describe it .
Speaker 2Yeah , well , you know I Say the word fun because some companies are gonna get burned and I like that because maybe they'll learn that you have to think about your business Long term and you have to change of the market changes and trying to get licensing terms from the same way you will . This is how we did it 20 years ago . Yeah , all right , you don't . You don't deserve to be in that position at that job anymore . If you don't evolve , change and adapt , you die . That's right . Companies go under . Someone comes out with a better product , a better service , a better price . If you can't communicate with clarity , consistency and candor of what your value is as a business , you're done .
Speaker 2And Part of the reason I say that mark is I was also thinking the other day , some of these brands , just over the last three years , have changed their product so many different times . Hmm , between naming right , who would have thought HBO Max back then was a place you would go for live sports ? Yeah , yeah , that's true , all right . And then you change to max and now you're like we're gonna add sports , and they did add some sports . And now they're like well , we're gonna add more sports , but it's gonna cost you in a different tier . Now you have to remarket this entire service to another segment of the market , another population that likes live or non-live sports or not sports , and you do that for three or four years a row in a row , and you keep combining apps now into one .
Speaker 2But you can't log into here if you have this . And oh , by the way , peacock spectrum . You want to take advantage of that . Well , first you have to cancel your Peacock account and then re-sign up . Yeah , what ? What are you doing to people ? Yeah , so in the long run , short term , long term , who's the winner in all this ? Netflix , absolutely Netflix .
Speaker 1Their product hasn't changed .
Speaker 2Everybody knows what it is . They know what it isn't . Yeah , they haven't changed the app . It almost always works . Yeah , and they're projecting five billion dollars of free cash for this year and they have the deepest catalog of content and will be the least impacted by a writer strike , yep . And Yet how many years were people talking about Right after COVID ? Really , oh my god , netflix is they only do one trick , pony . They're not like Disney .
Speaker 3Oh yeah , no , they're gonna have to get acquired by Apple . Yep , they're gonna have to get into sports , right yeah ?
Speaker 1yeah sports the shining star right now .
Speaker 2Yeah , yeah , yeah , yeah , absolutely . Look at their stock price too . Yeah Ha ha . Exactly what is Netflix's stock up ? Let's take a look , because I was like a day it was .
Speaker 2Yeah , I looked at it in the week or two , so Close the day , down 34 cents . Okay , so 52 week high 485 . Low is 211 . Wow , so that's incredible . So , year to date , january , there were 293 . Today they're 442 . Yeah , yeah , yeah , no surprise . Yeah , so we're gonna see winners and losers for sure .
Speaker 2So , mark , we've got a lot more to cover We'll do in the next podcast episode . Frankly , it's just there's so much going on here . I am gonna do a little plug here for the NAB show streaming summit , new York City . Hmm , I posted about a third of the content online last night , so there's now content up there . You can see some of the speakers , the content we were adding more in the next couple days . Four more sessions total on sports and fast separate . But as far as speakers , we've got Netflix , we've got YouTube , we've got We've got Disney , we have Amazon Prime Video , fubu TV , sinclair there's . There's a lot of really good companies AMC , hearst , quite , a few more than I can remember , but they're on the website more being added . Yeah , I'm excited for the show .
Speaker 2Day one I'm gonna have two tracks or like a track and a half . Day two will be one track and We'll have a bunch of networking events around it as well . I'm also mark trying to pull together a New York City streaming media meetup the night before on . That's great . It should be Monday , october 23rd . If anyone has an idea somewhere easy to get to , you know , midtown Please let me know . The hardest part was trying to do meetups in New York City is the location yeah , bar's , restaurant places you want to go , like you . Just tell them what you're doing . They're like yep , it's a minimum buy of 10 grand . It's like , yeah , what are you doing ? Open bar .
Speaker 2Yeah , I guarantee you a couple thousand dollars , like not not doing it . So if someone has an idea For a location , let me know . It cannot be a location that it's just two east to west , to north or south . I think people just don't go . It can't be like it's in your office . It's 40 floors up . Everyone has to be , registered with a security badge yeah thanks for that's not gonna work either .
Speaker 2Yeah , so you have a recommendation . I'd love to pull people together . It's been . It's been quite a while , mark . Finally , I am just gonna do a special podcast next week . I know you're away to IBC , yeah , but I'll do a special podcast next week just wrapping up how NFL Sunday ticket on YouTube TV went Great . So that'll drop in the next couple days and then , you know , I'm certainly interested to hear what , what you see at IBC . Yeah , get back and we'll talk about that in a podcast episode for sure .
Speaker 2Yeah , there's there's some , some interesting , I think , conversations that'll be had on stage from some of these broadcasters and distributors , especially with what's going on so Lot going on the space . Everything that I talked about today is already up on LinkedIn all the numbers , every single thing we spoke of it's it's already up there and , of course , mark and I will be covering even more of this throughout the rest of the year , hopefully , hopefully , the positive side of some companies getting together , working out .
Speaker 2Yeah , for sure , for sure . But in the meantime anyone has any questions , reach out to myself or mark . We appreciate everyone listening . We're always available to you , see , if any questions reach out . Thanks very much for listening . We appreciate everyone and we'll be back next week with another episode .
Speaker 1If you enjoyed the show , send it to a friend , have questions for Dan or Mark , connect with them on LinkedIn at any time and be sure to check out Dan's blog at streaming media blog com .