Speaker 1 0:02

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 2 0:20

Welcome to the Dan Rayburn podcast. I am Dan Rayburn, along with co-host Mark Donegan for a well, this isn't a special podcast, Mark, it's just a focused podcast.

Speaker 3 0:30

It's a all sports, all sports. Yes, all the time. Yeah, all sports all the time.

Speaker 2 0:35

We're just talking sports today. Mark and I are throwing in an extra podcast here. It's a bonus. There you go, bonus.

Speaker 3 0:42

It's a bonus podcast Double album. There you go. Bonus Bonus podcast Double album.

Speaker 2 0:45

That's right. We're dropping Double header.

Speaker 3 0:47

Since we're talking about sports, double header. There you go, hey.

Speaker 2 0:50

We're not going to talk about some of the earnings and the upfronts just because we'll cover that on the normal edition we do every weekly. But with all the news out Netflix, nfl, the new naming of the new sports, jv, some NBA rumors, some other things coming out we just figured let's wrap this all up into one sports-focused episode. So that's what we're going to cover today. Mark and I give you some of the numbers too that we've seen come out in some of this. But part of this is today, mark, I think just let's talk about what we personally think about some of this news, what we think it's going to do to impact fans.

Speaker 2 1:26

I've got some interesting comments here from Netflix that they sent back to me with some questions I had. Oh, wow, yeah. So before we go into Netflix and NFL, let's go with. We're recording this May 16th Thursday. The news just came out, maybe two hours ago, that the new sports JV of Disney, WBD and Fox is going to be called Venue Sports V-E-N-U. I don't know who has V-E-N-U-E, however you spell the normal venue, but they're going to be getting a lot of traffic at some point, so the name is Venue Sports. The company says it'll launch this fall. The rumors are still that they're targeting the month of September to launch. No pricing was announced today, so they really just announced the name. They did put up a website.

Speaker 2 2:15

Very limited information. A couple of key takeaways. Mark for listeners to know is they did say that they do not yet have contracts in place between Disney, WBD and Fox, so they don't yet have the legal terms they need in place for the JV. Now we heard this from Disney during their earnings call Sure, or actually their earnings presentation, but they did mention that they also said it needs something to the effect of regulatory approval. You know, does it actually need that? That may not be the case, but maybe they put that in there just due to the FUBO suit, Don't really know.

Speaker 2 2:56

But it does say that launch is conditional on receiving regulatory approval and is expected for fall 2024. So that is up. The website's up, venucom. Now Mark. On the functionality side. I don't want to go into too much detail here until I can, but I expect the service to launch with very minimal functionality. There's not going to be a lot of personalization in the user experience. The advertising is not going to be extremely personalized. Frankly, they just don't have enough time from inception of thinking of this to getting it launched to do all that.

Speaker 2 3:38

That makes sense. Now, venue Sports CEO said the product is quote being built from the ground up. I'm not really sure what that means, because most of the back-end tech is utilizing workflows for other video services already in place from Fox and the other JV partners, I mean Fox, has a very robust, you know, infrastructure.

Speaker 2 3:59

Signal acquisition right Pulling in signals encoding them, all that kind of stuff, the metadata management there's other pieces needed that they don't have in terms of the front end. Sure, yeah, it's definitely not the case. And also, it's not going to have a level of personalization consumers will want from the get-go. I guarantee you this isn't doing DAI down to a regional level, it's just not. There's not enough time to put that in place. Yeah, so I don't think that's wrong. There's going to be a bare minimum of functionality when it launches. Sure, sure, for all we know, mark, I don't know this, but we've also seen services in the past remember launches where they call it beta giving out expectations to consumers that, hey, even though you're paying for this, we're going to improve it.

Speaker 3 4:57

Yeah, yeah, it's the Google. You know how long was Gmail in beta.

Speaker 1 5:03

I mean like 10 years, right, Was it?

Speaker 3 5:05

really oh yeah.

Speaker 2 5:06

Wow.

Speaker 3 5:07

Yeah, and other.

Speaker 2 5:08

Google. But was it free or were you paying for it?

Speaker 3 5:10

Oh no, no, that's back when it was free. But yeah, I mean, it is something I think most consumers you know. You say something's beta. It's kind of like, oh okay, so if I have a little glitch, you know like, don't you know?

Speaker 2 5:24

I wonder if they'll do that. I think it would be interesting if they did. Just setting expectations, no idea, but no idea. But some of the quotes the CEO was giving out today, you know talking about, you know the best technology around they're going to be. It was just.

Speaker 3 5:37

Sounds like someone who's A? Little too marketing approach, yeah, I was going to say, and not very technical.

Speaker 2 5:51

Yeah, could be. I mean, they do have a CTO. They never actually announced who the CTO is. I'm not going to give out their name, maybe they don't want it out, but they do have a CTO, okay.

Speaker 3 5:56

So Is it somebody who came from one of those partners, someone who came?

Speaker 2 6:00

from.

Speaker 3 6:00

Disney.

Speaker 1 6:00

Okay, okay, okay Makes sense.

Speaker 3 6:02

Yeah, yeah, it totally makes sense.

Speaker 2 6:04

So we'll see what happens when this launches. Now I think what we have to tie into this Mark is clearly one of the big content pieces that would be part of this new sport. Sorry, we're not going to call it Sports JV anymore.

Speaker 3 6:16

Yeah Of Venu Sports. That's right V-E-N-U, v-e and you would be the NBA. Yeah.

Speaker 2 6:23

So you know the NBA right now in terms of WBD having it for TNT. Uh, today, in the last 24 hours, there's there's more rumors and news coming out in terms of what might happen with this and more rumors that it's going to be lost to NBC, more rumors that it's going to be lost to NBC, to NBC Universal. So apparently the number that people keep putting out there is NBC is bidding at $2.5 billion annually and that it wants to include a Basketball Night in America program. So very similar. If you know, NFL Sunday it's Football Night in America. That's kind of their brand. Apparently they want to do that with basketball as well. No-transcript. So are those numbers exactly right? We just don't know. It's going to be hard, so it's hard to know exactly what's being reported in terms of whether it's coming direct or from a third party, but it's very clear that all the different outlets seem to have the same numbers.

Speaker 2 7:49

So, let's just say that that happens. How does that impact venue sports when they launch less content? Now, they'd still have March Madness, so they would have that content. They wouldn't be losing that in the new deal, but it's. It's. There's so much unknown right here.

Speaker 3 8:06

Yeah.

Speaker 2 8:07

We still don't know pricing and we don't know exactly just what the functionality is going to be from a quality standpoint. Are they doing 4k? I doubt it. Almost nobody does 4k for sports as we know that's right.

Speaker 2 8:18

What is the impact of the FUBO potential? You know regulatory hurdle lawsuit? We don't know that either. But, mark, I was thinking we're in the middle of May. That gives them, you know, june, july, august, so three and a half months where they have to get past all of this and continue to get the product tested, and they're going to need to test it at scale.

Speaker 1 8:47

Right now I'm hearing.

Speaker 2 8:47

It's a very limited beta test amongst certain individuals and employees, so you're going to have to test this at scale. Now, the good news is the workflows a lot of them are already in place, but that's still a lot of work to do. And then you're going to have to come up with some sort of go-to-market branding campaign. So, Mark, the other thing I was thinking is remember the days of Aereo.

Speaker 3 9:11

Yeah, that's right.

Speaker 2 9:12

I remember Aereo In the sense that when you looked at how much they were spending for customer acquisition costs, they had to take a brand that no one had ever heard of and they were buying billboards in major cities. Now Disney, fox, wbd, right, have big pockets. They already do a lot of marketing. They can tag this on to all this other stuff that they're doing, but it still takes time to get an entire new brand out to consumers and then for them to understand what it has what's not included. Them to understand what it has what's not included. That's also important. Yeah, that's right. You know, when I went to the venue homepage Mark, right away, I just kind of cringed when I saw the language because it said watch the biggest games and sporting events that are happening. Well, you'll be able to watch some of the biggest games and sporting events, but not all of the biggest, and some of the biggest will not be on your platform. Yeah, nfl wildcard, that is not going to be on your platform.

Speaker 3 10:13

That will be one of the biggest.

Speaker 2 10:15

So, again set these expectations right with customers. So for venue, we'll have to keep an eye on it. We'll have more information out, obviously fairly soon, fairly soon, but that's the latest from them. So let's move into what I consider to be I would say Mark, one of the largest, most important pieces of news to come out in our industry in probably 10 years.

Speaker 3 10:43

Yeah.

Speaker 2 10:44

As you know, I don't sugarcoat anything ever. Yeah, no, and I'm not going to call this a game changer, because that's just ridiculous terminology but if this is successful with Netflix, this definitely impacts sports licensing going forward, in the NFL in particular, 100%. You have just you have a big change here in terms of how Netflix is thinking of live. We obviously know that. Yes, also, I found it odd, mark, that not a lot of people really focused on this, but this is the first time the NFL has ever done exclusive streaming deal where it is global.

Speaker 3 11:21

That's right, that is no one's really calling that out. Yeah, I'm surprised by that too, because that is incredibly disruptive to these other rights deals.

Speaker 2 11:33

Yes, and think about the Amazon Thursday Night Football and the exclusive game of Peacock wildcard last year. The exclusive game Amazon will have this year for wildcard. Um, the exclusive game Amazon will have this year for wild card. Peacock has an exclusive regular season game coming out of, uh, Berlin. No, where is it? Um, it's on a Friday? Um, so it's not Berlin. Where is it? Uh, Brazil? But that's all regional, yeah, yeah.

Speaker 2 12:27

So you have the NFL, which accounted for 93 of the 100 highest rated TV shows in 2023, now giving two games this year to the largest streaming platform in the world. That's a big deal, with no blackout restrictions. Yeah, yeah, that's right. So this is going to just be. There's going to be a lot for us to cover over this over time. Yeah, Now a couple of things, Mark, let's break out some factual things for this. One of the things I thought was really odd was Netflix said okay, we're going to do two games, a doubleheader this year in Christmas, no-transcript. Well, it's odd. You wouldn't come out and say you're going to do two. So the way it was phrased and also the way Netflix talked about this. I reached out to Netflix and they nicely did reply to me very quickly today to confirm that the decision to stream more than one game on Christmas is up to Netflix oh?

Speaker 3 13:14

wow, yeah, Okay, so it's not at a later date. It's not the league or the teams you know needing to you know put a schedule together, so they'll decide at a later date.

Speaker 2 13:24

So what this really is is a test, and at some point, somebody interviewed by Netflix did call this a test. Yeah, sure About how well this works, right, and if it works well which I expect it will, to Netflix standards, then they'll say, okay, we're going to do a second game next year and the year after, but it's their decision. Yeah, so I thought that was. That was interesting. Now, if you want to watch all the football games this year, or maybe even, depending what team you want to watch, how many streaming services and broadcast networks do you have to have? Mark, if you already looked at the notes and you already know the answer.

Speaker 3 14:00

Yeah, I know the answer. So go ahead and tell the audience. So it's seven. It already know the answer. Yeah, I know the answer.

Speaker 2 14:06

So go ahead and tell the audience. So it's seven.

Speaker 3 14:07

it's seven different ones this year Amazon, netflix, espn, nbc, peacock, fox and the NFL network, yeah, you know, you know, you know Dan, I wonder and this would be something actually be really cool if we could get someone maybe to come on we do a little interview or something with them. But you know someone who really understands the sports licensing. But I wonder if what is happening is it games are going to almost become their own standalone, like PNL, you know, and and it's like you're not going to license as much um a season. You know, like you used to do, right You're? You know, like Amazon has their, has their Thanksgiving, uh, you know where they did their black Friday, sorry the. You know the, the black Friday Friday game. And now you've got Christmas. You know, on Netflix, and you've got. It seems to me like these I don't want to call them special events, but that's sort of what they are. Right, yes, you know, because if you're paying, you know Amazon paid. What was that? A hundred million dollars, I think it was.

Speaker 2 15:16

We never really knew yeah.

Speaker 3 15:17

Okay, but and and it's being quoted Netflix is paying somewhere between 75 to 150, and so you know. So, okay, so, but you're paying somewhere in there. Well, somebody has done the math, you know, and of course it's a whole different set of calculus for Amazon as to what they get out of that and how they monetize it. You know, and Netflix would look at it very differently. But the point is, somebody has done the math and said, hey, this is going to be a profitable investment. Well, if that's how, um, you know, those who are licensing sports content are going to be looking at it. Aren't we just going to see a further breaking up of this? You know, of this thing where you would license, like whole season and you would know, oh, I go to this platform or I can go to my OTA provider and you know my local broadcaster, you know when they're in market and you know stream. Yeah, I'm just wondering if that's where we're headed.

Speaker 2 16:13

I think that's what we're starting to. I mean, we're already seeing that there's over 20 games that are exclusive to streaming this year. Yeah, they're exclusives, Exactly. So think about two years ago where, okay, you still had quite a few because of Amazon, sure, in only a couple of short years, the shift that we've seen. And what you're really saying is you know, could we see that shift more, with more games coming out of the schedule, more games we potentially could? Yeah, yeah exactly, exactly.

Speaker 3 16:37

And then the question is okay, are fans just so you know they just so love their, you know their team, you know their favorite team that it doesn't matter if it's all sort of just choreographed, you know they're going to watch. Or do fans start to say I don't really need to watch that game? I wish fans would.

Speaker 2 16:56

Honestly, I wish they would you know.

Speaker 3 16:57

I wonder if they're going to push back on this?

Speaker 2 16:59

No, they're not. Yeah, I don't think so. No.

Speaker 3 17:02

These are the same people who pay, you know, $125, $150 for a jersey, right or whatever.

Speaker 2 17:06

they are Consumers, don't like change, but they put up with it. I wish they would push back and I think they would if there were more games like in baseball. There are definitely games. Now I don't watch because it's not on where I go.

Speaker 1 17:21

It's Apple TV, it's Friday night, but when there's only what, is it 16,?

Speaker 2 17:23

17 games. In football, every game is important to real finance of that team.

Speaker 2 17:26

So I don't think that's going to happen, but you know your point. Talking here about fragmentation, there was an interview on CNBC today with the NFL executive I don't have his name in front of me, but he's the one who does all the licensing deals and the person CNBC basically said okay, so now it's going to Netflix. This is a lot of different places Consumers have to go. This is really fragmented. Like, what does the NFL think of this? And what he said was well, we don't see it. I'm not quoting here, so this is just paraphrasing. He said we don't see it as fragmentation of the market, since all NFL games are free in the team's local market. Yeah, yeah, now, okay, technically, that's accurate. It requires you to get an antenna to be ota, sure, but who has an antenna? Well, you have to have an antenna. Yeah, so for many consumers they'd have to go buy, buy another thing, another something.

Speaker 3 18:15

Then you can't pause or rewind it or record it, yeah, unless you go get a dvr that attaches, unless you're a geek like like we are, and we might have that stuff set up.

Speaker 2 18:26

But come on, that's not you know, I don't think anyone has a dvr just sitting around yeah, you could record it with a you know thing on your computer, but now it's on your computer, not your tv yeah the other thing is you know where do you plug your antenna into? Yeah right, it goes into the back of your tv, like in the back back, hey, so I'd have to somehow figure out how to take my tv off the wall.

Speaker 2 18:44

Off the wall, right it's just a plug-in, and then the quality you're going to get is going to be determined by one how good your antenna is.

Speaker 3 18:51

right, that's right, Some are not the best out there and your proximity to the tower?

Speaker 2 18:55

you know, to the transmitter the antenna. So for him to compare this and be like well, you know, there's no fragmentation, because you could always just, you know, get it in your local market, yeah, and that's not the same as getting it how we all used to on pay TV. Yeah, every time you turned on the channel, you me, no matter what state we're in, got the same level of quality. That's right. Now you're dealing with an antenna.

Speaker 2 19:18

And then how are you putting that antenna up? Like, are you doing it temporary? Is it a permanent installation? You're putting in your attic Like it's just. It's not reality that that's what most consumers are going to do, are going to want to do yeah also, mark, I don't have the numbers in front of us, but we did see.

Speaker 2 19:34

For the wild card game. You know, there were some numbers put out in terms of how many in local markets actually viewed, uh, the content that way. And you know, when you combine the two local markets of the teams, if I remember correctly, correctly, it was something around 900,000, maybe a million total. But if you think of the size of the entire game from an AMA, okay, that million made up less than 10%, maybe less than 5%. Right, go look at the numbers for listeners. But it's small and if it was that easy it would have been a lot larger.

Speaker 3 20:11

Yeah, yeah. So, dan, there's more news. That is not on the agenda, but it really ties in in my opinion, and it's the Comcast what do they call it?

Speaker 2 20:25

Stream saver.

Speaker 3 20:26

Well, okay, so think about it. It's Peacock, netflix, apple TV Plus. Now, you know, bundled at a vastly reduced price, and I don't think the price was quoted right, it wasn't, yeah, but anyway. So, okay, right, there, there's potential value, like, oh wow, I can get all three and I don't have to pay as much. But isn't it super, super ironic that we are absolutely headed back to number one, the bundle, and to? Somebody actually made the point which I thought was completely accurate We've got to quit talking about cable, you know, as if it's not, you know, pay TV, cable, cables, just the distribution mechanism, right, but I'm going to say cable, you know, but headed back to cable, because guess what that set-top box I'm guessing anyway is is perhaps going to show, in a unified view across these services, what's on, you know what? You know the um. You're not going to have to go into each app, I'm just assuming. But no, no you.

Speaker 2 21:29

This isn't one app that bundles it all together.

Speaker 3 21:32

But the X1, well, anyway, okay, we don't know.

Speaker 3 21:35

Oh, you're talking about set-top boxes, I'm talking about set-top boxes, yeah, and I'm talking about the Comcast deal specifically. The point I'm trying to make is is that 10, 12 years ago, all the conferences, everybody in the streaming industry was you know, the bundle, it's, it's, it's dead, nobody wants the bundle. The bundle is terrible, everybody you know. And that was the mantra, right, it was to, you know, sort of like fast is today, you know, and, and, and yet we're headed back to the consumers going give me a, please. Well, you, I think that's where we're headed.

Speaker 2 22:11

I think we've already been there because we've had to bundle stuff on our own. What's happening now is some are saying we're going to bundle this for you but, I, don't know that. That's what consumers are asking for.

Speaker 3 22:22

I know. But consumers, you know, okay, set aside all the demographics about those who have never had a cable subscription and you know I'll speak for myself. I won't speak for you, but you know I'm old enough that you know I definitely had cable for, you know, a portion of my adult life. But still you know there's a lot of consumers that kind of go. You know cable actually was not too bad.

Speaker 1 22:46

I still have it.

Speaker 2 22:47

I still think it's one of the best services out there as far as cost and the value that I'm getting, for the content I'm getting and the quality I'm getting.

Speaker 3 22:53

Yeah, but I think the bundle mark is.

Speaker 2 22:56

what consumers wanted always was a la carte right, and that's not what we have. Because here Comcast is saying we're going to decide which apps streaming services you get in our bundle. You can't go pick them yourself. Well, that's true.

Speaker 3 23:08

That's true you get in our bundle. You can't go pick them yourself. Well, that's true, that's true, and, and you know, this is based on the deals that that they put together. So, who knows? You know I mean this, you know, oh yeah, and they're probably out talking. I'm just assuming they're talking to everybody, or everybody's talking to them. And who knows, it could be that Comcast stops losing subs and start showing net gains. You know, wouldn't that be interesting?

Speaker 2 23:30

Yeah, I wouldn't think because of the bundle, though Keep in mind, too, that this is going to be available to Comcast wireless subscribers who don't have a set-top box. Mm-hmm, interesting Right, so it's going to be similar. I view it as like what Verizon did with Play.

Speaker 3 23:43

Yeah, that's right, you know, bundle it all together.

Speaker 2 24:13

So a couple other quick yeah that's right in the 75 to 100 million dollar range. Yeah, exactly. Uh, let's see, it was also asked by netflix during a conference here how they would produce the games. Uh, they didn't say, but we expect that naturally they're going to work with a production partner they're going to work with.

Speaker 3 24:22

Yeah, exactly, just like amazon does.

Speaker 2 24:25

So next up mark here. Let's's just cover here at the end some quick deals we've just seen in the last couple of days. So Roku's deal with MLB is official. They did announce that jointly. It's going to bring Sunday morning games a total of 18 to the Roku channel for free. So this will be free for anyone who has a Roku channel, so not just Roku devices. Is a Roku channel? So not just Roku devices.

Speaker 2 24:48

This is being called Roku MLB Sunday Lead-Off. The games start actually this weekend, sunday May 19th. No blackout restrictions, wow. So yep, that's pretty cool, and it's going to offer full game replays six hours after the game ends. Okay, no details there on what Roku is paying. It would be nice if we knew that one as well. Yeah, I'm hearing that. Yeah, this used to be on Peacock that NBC was interested in bidding on the games again, but only if MLB was willing to take far less than they originally paid, which obviously MLB was not willing to do and shop this around. But we don't know how much Roku paid. Next up is launching this August, sky is going to bring more sports to viewers with Sky Sports Plus. This is at no extra cost, they say. Now you wonder how long it's going to last. Yeah, Teaser.

Speaker 2 25:43

You wonder? They're saying that customers can now enjoy over 50% more live sports this year. They're saying that customers can now enjoy over 50% more live sports this year and they will enable the capability to show up to 100 live events via concurrent streams. So getting more sports. That's great. It's going to be integrated into Sky TV Streaming Service Now and a revamped Sky Sports mobile app, so that's coming in August. Interesting to see what additional sports they're adding there, because they didn't say yeah exactly Curious what additional content it is.

Speaker 2 26:16

Hopefully it's sports people want to watch, yeah, but it's incredible because people want to watch badminton and all these other sports that you would think are successful, but from a niche standpoint they are, yeah, tying into more sports. Mark, bleacher Report I saw an ad the other day for Max and then it talked about the Bleacher Report sports add-on and then I saw it still said, you know, free for a limited time, and I was like, wow, that's still free. So I don't know the background behind this and Warner Bros Discovery isn't chatting on this, mm-hmm. But I'm wondering why it's still available as a free add-on to all Mac subscribers, because, and if we remember, originally it came out and they said when they were going to start charging consumers, yeah, and I think it was back in February or March.

Speaker 3 27:11

And then they announced like well, we're going to continue to make it free for everybody. Yeah, yeah.

Speaker 2 27:15

I don't know why that is. I don't know if that ties into somehow the JV. The JV, yeah. Does that somehow tie into venue sports?

Speaker 3 27:27

I don't know, I wonder would they roll tie into venue sports. I don't know. I wonder if would they roll that into venue. I wonder, I mean, would they just sort of like absorb it?

Speaker 2 27:37

Rights-wise. Even Well, they wouldn't absorb it. I think they would definitely still keep it in max. That makes sense.

Speaker 3 27:45

But are you also providing some of that same content to?

Speaker 2 27:46

venue? Yeah, yeah, exactly, I don't know. But hey look, it's great, I'm not complaining. It's great for anyone who has Macs. You're getting free sports and they're doing a great job as far as the quality of just what they produce. But in this day and age, when we know sports licensing is the most expensive content to license, yeah, who's paying for this? Who's paying for this? That just seems odd to me. But it's, it's still free. Uh, another one here. Mark was, uh, you know, pretty, pretty interesting that little over a week ago, diamond sports group issued an open letter to sports fans and specifically to Comcast Xfinity subscribers, because they lost access to Diamonds Valley Sports regional networks on May 1st of this month. So they basically sent a letter, basically just saying hey, comcast pulled the plug on our networks. You know we made a best effort, you know, to come up with a distribution deal, blah, blah, blah. Like all this nonsense they always do.

Speaker 2 28:49

Um and you know they did talk a little bit about Comcast proposal, which was in a renewal discussion. Comcast would put Bally Sports on a on a tier that they said would require customers to pay more. They didn't think that was right. Now is that actually the case? Well, it could say that they could put it on a higher tier in the contract, but does it necessarily say that consumers would have to pay more for that? I don't know. So what they're saying is, quote we're turning to you, the fans. Raise your voices, let Xfinity know you want your teams back in the air.

Speaker 3 29:29

And they built a website called save our local teamscom. Yeah.

Speaker 2 29:35

Yeah, so uh, you know, it's just funny. I mean you got to laugh at this, even though, frankly, it's really sad for consumers. But you have to laugh cars.

Speaker 3 29:48

Well, you have to laugh.

Speaker 2 29:49

Here are, you know, companies that are making a lot of money, that have a lot of profit. Well, not a sports group, right? They're coming out of bankruptcy, but but Comcast, uh, talking about just, oh you know, hey, poor us. Let's put this out for the fans to now do our work for us. Maybe they can convince people to change contract terms. Yeah, that's not the way it works. It's never worked that way ever. No matter how much fans get upset, that doesn't change contract terms.

Speaker 3 30:16

Yeah, yeah. And, like you said, fans can get upset and they can be vocal. But guess what, if they all still pay? Go to the games, buy the jersey, you know, still support the team. Like, uh, it's not changing anything, yeah, it's not changing.

Speaker 2 30:32

But think about the work that you know they went through here to create a website, set out a brand, you know, create this brand. They're sending out letters Like, oh come on, guys, just solve it. Yeah, yeah, it's ridiculous. Uh, we'll go through some other Netflix stuff from this week, from the upfronts on the regular weekly one. But I did want to say here just one of the things I thought important because we should track this over time is Netflix did say there were 70% of their ad tier members stream at least 10 hours of content per month, and I don't ever previously remember Netflix giving out a number on the average number of hours streamed in an account or a specific account tied to Avod. I thought that was interesting.

Speaker 2 31:12

So we're talking sports here. I'm curious if, over time, as Netflix gets more sports related content if we want to call some of the other things they're doing sports related, not necessarily sports events will they start breaking out for Wall Street? How many hours per month certain percentage of members are watching sports? Because while we get very high level information after a one-off NFL game or sporting event, I have no insight into this, mark. So this is a total guess on my part, but I don't think Netflix can get away with that no-transcript. We'd never get into live and we'd certainly never get into sports, because we can't make money from it. So now you're telling wall street that you think you can make money with sports over time, hence why you're paying the money you are to license it.

Speaker 2 32:29

Yeah, so interesting there in terms of some of the numbers that they gave out during their presentation this week, but I thought the 10 hours of content per month was really interesting. Now what I'd like to know is how does that compare to people who aren't on the AVOD plan? Yeah, that's right, because they only spoke about the AVOD tier, the ad tier. Yeah, that's right, because they only spoke about the AVOD tier, the ad tier. Yeah, so why segment that? Is the number so much larger? Or are you trying to show growth over time and then, a couple of quarters from now, you're going to say it?

Speaker 2 32:57

was 15 hours or 20 hours Because what we do know is the revenue they get from AVOD members is dependent on how many hours they watch, of course, which depends how many ads you insert. Yeah, that's right. So I Netflix is really smart here. They're already lining up that number for wall street so they can start comparing it over quarters.

Speaker 3 33:17

Yeah, yeah, smart, just just like how, for years, they reported on sub growth. Yes, purely, yes, purely, quarter over quarter. How many subs did we add?

Speaker 2 33:29

Yeah, so hours tied to how many ads you're potentially inserting in an hour. I think that's interesting. I like the fact they're laying the groundwork now. Netflix is not idiots. People sometimes are like man, these guys. They don't know what I want to watch. Okay, maybe with you they don't. But man, $6.92 billion of free cash flow last year yeah, more subs than anybody else by a wide margin. Now they're going to have NFL games. I mean, they are doing some interesting things in the market we don't see others doing. And when you've got the CEO of Disney publicly stating multiple times that Netflix is quote the gold standard, you're doing something right. You're doing something right. You're doing something right. Yeah, now, mark, we didn't talk infrastructure. You know Netflix. How are they going to handle NFL and their network? Maybe we talked at a later time. They're obviously not talking too much right now about how they're going to do that redundancy.

Speaker 3 34:23

But I, I will. I will say and this is you know, very, very public because I've reposted a number of these job postings or job listings but Netflix has been hiring across the live encoding team, live streaming.

Speaker 2 34:39

Yeah, the whole live team has grown there tremendously.

Speaker 3 34:42

Yeah, tremendously. Still positions open and so you know there's still positions open and you know we all know some, or maybe all of the individuals working there. It's a really strong group, very, very strong. They know how to do this. They've done it before. They've built, operated at scale.

Speaker 2 35:16

So, yeah, this is a little different, though it's live. We don't know the bit rate. I guarantee you this isn't 4K.

Speaker 3 35:18

but this is a little different because there's no data to go off of an NFL game that is global. You can't use the Peacock numbers. Viewership will be super interesting, right.

Speaker 2 35:23

But here's the thing this isn't a wild card game, yeah, and it's going to be on Christmas, yeah. So how many people on Christmas are tied up with family? Something else? Okay, many will want to, because families are watching NFL games, sure, sure, yeah, but Christmas is a tricky one. So the only day that we have to go off of that is a little bit similar is Thanksgiving. It's a very different day than Christmas. A lot celebrate Thanksgiving. There's plenty of people, I don't know, that don't celebrate Christmas, but then you also have the international global side of it.

Speaker 2 35:56

But also how many people might go to Netflix because there's already so many subs on that day and just be like oh, there's an NFL game Maybe.

Speaker 3 36:02

I'll just watch a little bit of it. Maybe I'll watch that.

Speaker 2 36:04

Yeah, exactly Does that drive up the average minute audience. I don't know this is. It's an interesting one and I hope over time Netflix gives out some more information in terms of the infrastructure side of this, but it's going to be one to really watch and, as an industry Mark, we're going to break this down afterwards and I expect Netflix will be very public in terms of how they built it out and what they did, because they usually are yeah, I expect Netflix will be very public in terms of how they built it out and what they did, because they usually are.

Speaker 2 36:30

Yeah, but think about truly a sports potential for a piece of sports content this popular in, obviously, north America on this global of a scale. We've never had anything like that outside of what we see with cricket in India. Yeah, that's right. So it's going to be fascinating to watch. So that's what we got on cricket in India. Yeah, that's right, so it's, it's going to be fascinating to watch. So that's what we got.

Speaker 2 36:55

On the sports side. Um, what did I miss here, mark? There's probably one or two pieces, but we'll cover that in our usual weekly wrap up. Sounds good. So we're going to take a about a one week break at the end of this month here as we travel, but then we'll be back with more weekly wrap up news. We're done with earnings, finally. Uh, the upfront stuff is over, so we'll cover that in the other one.

Speaker 2 37:13

But, uh, we'll get back to some of the uh, the other topics that we want to get to, that we keep pushing off our plate because of all this news coming out, which is pretty exciting, I got to say, but man, it's like you know, I'm trying to go to bed the other night like 1130 at night and then all of a sudden someone texts me and they're like, oh, you know, the NFL news is out with Netflix and I was like, really, really near midnight someone broke that and I'm just like, okay, I guess I can't go to bed right now. That's right. But yeah, it's incredible to be in the industry at the time we are, mark, and just what we're seeing and the quick change. It's fascinating to see how quickly this market is moving. Yeah, yeah, completely agree. So that's what we got.

Speaker 2 37:56

Thanks everyone for listening. We'll be back with another episode next week. If you have any questions, hit Mark and I up on LinkedIn, or just emails directly or just text or call me, as people seem to do every day, which is cool. Everything we talked about Mark today is already up on my LinkedIn. I put everything up in the last 24 hours, so it's all there. Everyone can go. Look at the numbers. Appreciate everyone listening. We'll talk to you next week.

Speaker 1 38:19

If 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 streamingmediablogcom.