DIS Shareholders and Stock Info ONLY

[Suger Mag]

Elemental is really not at all like West Side Story other than the star-crossed lovers trope which is used in many, many stories. You could say it's "just Romeo and Juliet with elements instead of people" too but that is incredibly reductive and inaccurate.

and to be fair... West Side Story is just an adapted musical version of Romeo and Juliet

 

[etherealcaitiff]

and to be fair... West Side Story is just an adapted musical version of Romeo and Juliet

Which is in turn an adaptation of the Arthur Brooke's poem "The Tragicall Historye of Romeus and Juliet". It's turtles all the way down. Well, it's not "Turtles All the Way Down", that's a book by John Green that also has elements of Romeo and Juliet. I guess more of a Mobius strip of teen romance.

 

[Suger Mag]

Which is in turn an adaptation of the Arthur Brooke's poem "The Tragicall Historye of Romeus and Juliet". It's turtles all the way down. Well, it's not "Turtles All the Way Down", that's a book by John Green that also has elements of Romeo and Juliet. I guess more of a Mobius strip of teen romance.

oh I wish there was a laugh and a love response. had to go with laugh

 

[PolymerSkywalker]

Which is in turn an adaptation of the Arthur Brooke's poem "The Tragicall Historye of Romeus and Juliet". It's turtles all the way down. Well, it's not "Turtles All the Way Down", that's a book by John Green that also has elements of Romeo and Juliet. I guess more of a Mobius strip of teen romance.

Wow what a complicated plagiarism scheme!

 

[Brian Noble]

and to be fair... West Side Story is just an adapted musical version of Romeo and Juliet

Which is in turn an adaptation of the Arthur Brooke's poem "The Tragicall Historye of Romeus and Juliet". It's turtles all the way down.

I went to grad school during a time when a bunch of other PhD students at CMU were studying interactive fiction. The short version: How do you use techniques from the AI community to convert "linear" games/stories into experiences that are less directed and independent of a particular line of narrative. This is beyond what we'd call "open world" games now, which still have a single underlying narrative thread. You are allowed to go on side quests, but the single thread is still there.

One of them had a book that was many decades old (and this was the 90's) that claimed to have The Taxonomy of All Stories. The buddy story, enemies-to-lovers, the hero's journey etc. etc. etc. each with a variety of subtypes. In total, I want to say there were maybe several dozen, tops.

Old wine in new bottles.

 

[Brian Noble]

We've been talking a lot about ESPN's rock/hard place problem. Today's NYT has a nice summary.
https://www.nytimes.com/2023/08/02/business/media/espn-disney.html

 

[PolymerSkywalker]

I went to grad school during a time when a bunch of other PhD students at CMU were studying interactive fiction. The short version: How do you use techniques from the AI community to convert "linear" games/stories into experiences that are less directed and independent of a particular line of narrative. This is beyond what we'd call "open world" games now, which still have a single underlying narrative thread. You are allowed to go on side quests, but the single thread is still there.

One of them had a book that was many decades old (and this was the 90's) that claimed to have The Taxonomy of All Stories. The buddy story, enemies-to-lovers, the hero's journey etc. etc. etc. each with a variety of subtypes. In total, I want to say there were maybe several dozen, tops.

Old wine in new bottles.

Can you send the section on "the hero's journey" to Rian Johnson please? He seemed to miss that section of film school.

 

[Brian Noble]

What do you mean? Looper was a great example of the genre.

 

[wabbott]

https://www.nytimes.com/2023/08/02/business/media/espn-disney.html

How ESPN Went From Disney’s Financial Engine to Its Problem
The sports juggernaut continues to earn billions of dollars for Disney, but profits are down and opportunities for growth have dwindled.
By Kevin Draper and Brooks Barnes
Aug. 2, 2023, 5:00 a.m. EDT

ESPN has been Disney’s financial engine for nearly 30 years, powering the company through recessions, box office wipeouts and the pandemic. It was ESPN money that helped Disney pay for acquisitions — Marvel, Lucasfilm, Pixar, 21st Century Fox — and build a streaming service, transforming itself into a colossus and perhaps traditional media’s best hope of surviving Silicon Valley’s incursion into entertainment.

Those days, ESPN’s best, are over.

With its dual revenue stream — fees from cable subscribers and advertising — the sports juggernaut continues to earn billions of dollars for Disney. In the first six months of the 2023 fiscal year, Disney’s cable networks division, which is anchored by ESPN and its spinoff channels, generated $14 billion in revenue and $3 billion in profit.

The problem: Wall Street is fixated on growth. Revenue for those six months was down 6 percent from a year earlier, as profit plunged 29 percent.

Disney is now exploring a once-unthinkable sale of a stake in ESPN. Not all of it, Robert A. Iger, Disney’s chief executive, has made clear. But he wants “strategic partners that could either help us with distribution or content,” he said during an interview with CNBC last month. Disney has held talks with the National Football League, the National Basketball Association and Major League Baseball about taking a minority stake.

Underscoring the complexity — and urgency — Mr. Iger has brought in two former senior Disney executives, Kevin Mayer and Thomas O. Staggs, to consult on ESPN strategy with James Pitaro, the channel’s president, and help put together any deal. Their return, earlier reported by a Puck newsletter, was confirmed by two Disney executives who spoke on the condition of anonymity to discuss internal matters.

“It is really tricky in this cord-cutting environment to see the real growth opportunities available to ESPN,” Steve Bornstein, a former chief executive of ESPN, said in an interview. Still, “they have a great hand,” he added, reeling off strengths like the numerous rights the network has to air live games, its digital assets and a popular website.

Mr. Iger made clear during the interview with CNBC that things will change at ESPN, but his comments generated more questions than they answered. Exactly what kind of strategic partner is ESPN seeking? Does ESPN need money, technological help or assistance with distribution?


“There is so much uncertainty in what Bob meant,” said Michael Nathanson, a media analyst at MoffettNathanson.

Mr. Iger declined to comment. Disney is scheduled to report quarterly earnings next week. Analysts expect per-share profit to have declined 11 percent, as the company contends with disappointing box office results, softening attendance at Walt Disney World and two striking Hollywood unions.

Whatever might be in ESPN’s future, its problems are easy enough to understand.

The bulk of ESPN’s revenue comes from what are called affiliate fees. These are monthly fees that cable providers — like Comcast, Charter Communications and Cox — pay ESPN for the right to offer its television channels to households.
Last year around 71 million United States households paid for a television package that included ESPN, and those cable providers, in turn, paid ESPN an average of $8.81 per month for each home, according to S&P Global Market Intelligence.

S&P Global Market Intelligence estimates that ESPN has also taken in more than $2 billion annually in advertising in recent years.

But cord cutting has been hurting both those revenue streams. A decade ago, more than 100 million households received ESPN, meaning 30 million fewer households get ESPN today than in 2013. ESPN has consistently raised its affiliate fee to offset this decline, but its ability to continue doing so will be limited in the coming years: By 2027, fewer than 50 million homes will pay for cable television, according to PwC, the accounting giant.

At the same time, ESPN’s costs are exploding. ESPN will pay an average of $2.7 billion annually over the next decade for the right to show the N.F.L., a 42 percent increase from what it used to pay. It will soon negotiate with the N.B.A. on a potentially very expensive renewal of its rights agreement.

According to Disney’s financial filings, it will pay $10.8 billion this year for sports programming. It has future commitments totaling about $57 billion, with some of its contracts running well into the 2030s. These contracts are a result of a spending spree the company has undertaken to head off deeper-pocketed tech companies, which are also hungry for sports programming, and to stock its nascent ESPN+ streaming service.

“The cord-cutting phenomenon is a response to the increasing cost of cable, and indeed the increasing cost of cable is due in part to the increasing cost of sports rights,” said Roger Werner, a former ESPN chief executive who helped create the dual revenue stream. “There is a causality there.”

To pay for the rights, ESPN has cut back in other areas — primarily original programming — and relied more heavily on a handful of its most famous personalities, like Stephen A. Smith. Once justifiably proud of never having undergone layoffs, the company has seen six waves of layoffs since 2015, including one that affected a number of high-profile executives and on-air personalities in June.

At the same time, it is confronting the turbulent economics of the streaming era.

ESPN+ shows thousands of games annually, but very few are the biggest N.F.L., college football, N.B.A. or baseball games. Those marquee matchups are reserved mostly for ESPN and ABC, which is also owned by Disney (and potentially for sale). Sports leagues are reluctant to allow media companies to offer games exclusively on streaming platforms, where they almost always reach much smaller audiences than on network or cable television.

As of April, ESPN+ had 25.3 million subscribers, though only five million people paid for it directly, according to Disney’s financials. The bulk of ESPN+ subscribers bought it as part of a discounted bundle with the far more popular Disney+ and Hulu streaming services.

Mr. Nathanson, the analyst, called ESPN+ a “complementary” product, something attractive mostly to die-hard sports fans.

The question, then, is when will Disney offer ESPN as a stand-alone streaming channel, allowing people to buy it à la carte, and not as part of some larger package of channels they don’t really want?

“We haven’t said when, but we do know that it will happen,” Mr. Iger said on CNBC.

Pricing, however, is an enormous obstacle. Offering ESPN à la carte will assuredly hasten the erosion of the cable bundle, which is held together mostly by sports.

“The current cable bundle, if you are a sports fan, is probably the optimal way to watch sports content because the majority of sports are in that bundle,” Mr. Nathanson said.

Affiliate fee increases for other Disney channels will slow, or even decrease, when they are sold on their own without ESPN. Cable providers are likely to be far more aggressive in offering cheaper, skinny bundles that do not include ESPN channels.

Disney’s family of sports channels currently earn somewhere north of $12 per month in affiliate fees for each cable subscription, according to S&P Global Market Intelligence. Estimates vary widely, but if ESPN offered its cable channels à la carte, it would most likely have to charge an astonishingly high fee for the streaming service, perhaps $40 or $50 per month, just to maintain its current revenue.

“It is not easy,” Mr. Nathanson said. “It really is not. That is why they have been reluctant to do it.”

Kevin Draper is an investigative reporter on the Sports desk, where he has written about workplace harassment and discrimination, sexual misconduct, doping, league investigations and high-profile court cases. More about Kevin Draper

Brooks Barnes is a media and entertainment reporter, covering all things Hollywood. He joined The Times in 2007 as a business reporter focused primarily on the Walt Disney Company. He previously worked for The Wall Street Journal. More about Brooks Barnes

 

[PolymerSkywalker]

What do you mean? Looper was a great example of the genre.

Well, he sure seems to have forgotten it by the time he made The Last Jedi.

I thought Looper was a solid movie, but I loathe the Last Jedi. That ruined me so much with Johnson that I can't bring myself to watch any of his newer stuff since then.

 

[Brian Noble]

I think you missed the joke.

 

[PolymerSkywalker]

I think you missed the joke.

I am sure you are correct. I did like Looper though. I was excited about Johnson directing a Star Wars movie due to how much I liked Looper.

 

[clarker99]

Less Sharks vs Jets, less Star Wars moaning and more Shareholder talk. There are other threads for whining and complaining about specific things.

 

[PolymerSkywalker]

Less Sharks vs Jets, less Star Wars moaning and more Shareholder talk. There are other threads for whining and complaining about specific things.

Yep, that's fair.

I would think that Disney getting Star Wars to have mass public appeal again would be a very good development for the shareholders though.

 

[PolymerSkywalker]

https://www.nytimes.com/2023/07/31/business/dealbook/disney-iger-mayer-staggs.html

Seems like the stock has responded positively to this move.

 

[PolymerSkywalker]

https://deadline.com/2023/07/kevin-mayer-tom-staggs-walt-disney-bob-iger-1235451330/

 

[wabbott]

https://www.thewrap.com/warner-bros-discovery-q2-2023-earnings-preview/

Why ‘Barbie’ May Not Be Enough to Put Warner Bros. Discovery Back in the Pink
David Zaslav is likely to tout the Margot Robbie-led film’s recent success as he reports earnings Thursday – but Wall Street has other concerns
Lucas Manfredi
August 2, 2023 @ 6:00 AM PDT

In Warner Bros.’ summer hit “Barbie,” Ryan Gosling’s Ken has a breakthrough when he realizes he can find meaning without the titular doll played by Margot Robbie. Warner Bros. Discovery CEO David Zaslav will have to do the same on Thursday, demonstrating to Wall Street that there is more to the company’s growth story beyond the film’s recent success.

“Barbie” is an undeniable hit, on pace to reach $1 billion in global box office by Sunday. But it’s unlikely to do more than balance out some recent superhero flops. And Warner Bros. Discovery still has a heavy debt load that it’s struggling to shed, which is where analysts will likely focus their questioning on the company’s second-quarter earnings call.

“Going into earnings this week, Warner Bros Discovery will likely tout the recent box office brilliance of ‘Barbie’ and hope less attention is paid to some recent swings and misses,” Third Bridge analyst Jamie Lumley told TheWrap. “As big as the July results are, the releases last quarter of ‘The Flash’ and ‘Shazam’ did little to reignite energy in theaters.”

Rosenblatt Securities analyst Barton Crockett told TheWrap that the company’s upcoming results will be a “tale of cross-currents.”

“How are they handling the pressure on pay TV, which drives most of their cash flow right now, versus the hope that at some point streaming and Max can make up for those pressures?” he asked. “Our sell rating on the stock presumes that this will be difficult to navigate. To that end, we know that pressures on pay TV are mounting [and] ratings at CNN are challenged.”

Investing.com senior analyst Jesse Cohen told TheWrap that he believes the second-quarter results will support the view that “the company faces an uncertain demand outlook as it struggles to defend its market share.” The company recently reorganized its sales teams to better unify its revenue efforts.

Time to talk “Barbie 2”?

One interesting question is whether Zaslav will present “Barbie” as the base of a future franchise, which would transform it in investors’ eyes from a one-off to an ongoing revenue stream.

Former HBO programming executive Andy Goldman, now an adjunct professor at New York University’s Tisch School of the Arts, called the film’s release a “zeitgest moment” and thinks “Barbie” presents a growth opportunity for the company.

However, he warned against “a tendency to overleverage an unproven ‘universe’” by announcing potential sequels or spin-offs. And he pointed out that Warner Bros. is still in the midst of rebooting its DC Universe under James Gunn and Peter Safran, an effort that likely won’t bear fruit until 2025.

Crockett pointed out that the recent success of “Barbie” has “pretty well offset the headwinds” from the underperforming “The Flash,” but he noted that the movie industry as a whole remains “a hit-and-miss business.”
Hollywood’s strikes are just adding to that uncertainty. Crockett wondered if Zaslav would address the possibility of delaying movies because striking actors won’t be available to promote them.

Streaming profits

In addition to the Warner Bros. studio, analysts will be laser-focused on profitability in its direct-to-consumer business, which includes Max streaming subscriptions as well as traditional HBO customers.

Streaming media analyst Dan Rayburn is curious to see if the division’s $50 million profit last quarter was a one-off or a trend that will continue, he told TheWrap. Executives have forecast that the division will turn profitable by the end of 2023.

Profitability in streaming has become increasingly important for legacy media amid ongoing pressure on linear TV, which Lumley warned is “likely in for a rough fall season” due to the historic double strike by SAG-AFTRA and the Writers Guild of America.

“Understanding the full impact of the strike will be crucial for looking at Warner Bros Discovery’s trajectory,” Lumley said, warning that a slowdown in new content on streaming services could lead to a rise in cancellations.

Cohen believes that Warner Bros. is “well-positioned to deal with the ongoing writers’ strike in Hollywood thanks to its solid pipeline of content,” but warned that “a lengthy strike by writers and actors will eventually cause damage.”

In the short term, the dual strikes halting scripted production will give the debt-laden entertainment giant an opportunity to save some money as Zaslav looks to cut more costs across the company, Goldman said.
The Writers Guild of America has accepted a request from Hollywood studio leaders, who negotiate with the guilds through the Alliance of Motion Picture and Television Producers, to discuss resuming contract negotiations, and the two groups plan to meet on Friday.

Cutting cable costs

In addition to wanting clarity on how pay TV pressures are impacting affiliate fees and ad revenue at WBD’s Turner networks, Crockett is also curious how far Zaslav’s cost-cutting can go to mitigate these pressures.

The company previously estimated that it will incur up to $5.3 billion in total restructuring charges before taxes, including up to $3.5 billion in content impairment and development write-offs. That restructuring is expected to be completed by the end of 2024.

As for Max, Crockett will be focused on subscriber, ARPU and ad growth and “cost controls balanced against investment in growth.”

“This has trended to become a breakeven-ish business,” Crockett said. “It needs to be much more than that to overcome the pressures on pay TV.”

Deutsche Bank analyst Bryan Kraft, who currently has a $33 price target on WBD stock, lowered the firm’s estimates for the company in a July 13 research note, citing a “slower-than-anticipated advertising market recovery in [the second half] and continued woes at the box office.”

Kraft lowered the bank’s estimate for Studios EBITDA because of “the perfect storm of ‘Barbie’ marketing expenses ahead of its release in [the third quarter], and significant underperformance from ‘The Flash.’”

However, the firm retained its buy rating on the stock based on the “core idea that WBD’s top tier content engine and library, plus sports and news, positions the company well to succeed once the macro environment is more favorable.”

Additionally, Kraft expressed confidence in the company’s continued transition to streaming with the relaunch of Max in Latin America in the fourth quarter and the Europe, Middle East and Africa and Asia-Pacific markets next year.

He added that the studio division may see some lift in the second half of 2023 following the November release of “Harry Potter: Legacy” on the Nintendo Switch in November and the release of “Mortal Kombat” in September as the fighting game franchise celebrates its 30th anniversary.

While Deutsche Bank believes that the Max launch has gone well, Kraft lowered the firm’s DTC subscriber expectations by 1.5 million given “the steep content fall-off from ‘The Last of Us’ to the disappointing ‘The Idol’ in combination with some churn from the 4 [million] overlapping subscribers that had both Discovery+ and HBO Max heading into the relaunch, and less marketing in international markets ahead of those relaunches.”

The bank expects WBD to report 54.8 million domestic subscribers and 41.3 million international subscribers and post an adjusted EBITDA loss of $243 million in the second quarter.

Wells Fargo analyst Steve Cahall, who has an overweight rating on WBD stock, said in a July 13 note that investors need to see a path in which the company is able to offset its networks-driven EBITDA pressures. Cahall thinks licensing HBO and Warner Bros. content to other streamers and paring back DTC investments “could help drive earnings regardless of linear trends.”

A Warner Bros. Discovery spokesperson didn’t immediately respond to TheWrap’s request for comment on the range of questions raised by analysts.

Analysts surveyed by Zacks Investment Research are expecting a loss of 38 cents per share on revenue of $10.5 billion. Ahead of the quarterly results, Warner Bros. Discovery shares are up 34.9% year to date, closing Tuesday at $12.87.

The gap between the company’s current stock price and Wall Street’s more ambitious targets might remind observers of the harrowing journey from Barbie Land to the Real World. Like the pink-clad protagonist in “Barbie,” Zaslav has some painful encounters ahead.

Lucas Manfredi joined TheWrap in November 2022 after four years at Fox Business. He can be reached at lucas.manfredi@thewrap.com.

 

[wabbott]

https://www.cnbc.com/2023/08/02/dis...-minority-partners-but-deal-wont-be-easy.html
Disney CEO Bob Iger wants minority partners for ESPN, but landing a deal won’t be easy
Published Wed, Aug 2 20231:52 PM EDT
Alex Sherman@sherman4949

Key Points

• ESPN has held talks with the NBA, NFL, MLB and the NHL on being minority partners in the network.
• ESPN likely will not launch a direct-to-consumer product before 2025, sources said.
• While Iger would prefer to keep a majority stake in ESPN, Disney executives would consider a full spin of ESPN if they can’t reach a deal to do so, according to a person familiar with the matter.

Disney CEO Bob Iger has taken the unusual step of paying former executives Kevin Mayer and Tom Staggs a consulting fee to help him solve a complex problem: what to do with ESPN.

Mayer and Staggs are the co-CEOs of Candle Media. Both men are close with Iger and have served as informal advisors to him in the past. They’re working with ESPN President Jimmy Pitaro on the strategic options for ESPN and, to a lesser degree, Disney’s other linear cable networks.

Iger is looking for new ways to jumpstart ESPN because the rate of U.S. cable cancellations has accelerated. In years past, ESPN could still generate revenue growth by increasing programming fees for pay TV distributors, such as Comcast, Charter and DirecTV.

That dynamic no longer exists. As ESPN revenue declines, it will become a larger anchor on Disney’s earnings. That has prompted Iger to explore different strategic alternatives.

Iger told CNBC’s David Faber last month he has had become more confident about when ESPN will launch a direct-to-consumer product. ESPN’s best programming is still exclusive to the linear cable TV bundle. Disney offers many of its lower-rated live games on its ESPN+ streaming service, which costs $9.99 per month.

When ESPN does decide to offer an unbundled subscription service, it will likely cause even more people to cancel pay TV. That’s why ESPN has waited so long to go direct to consumer.

Iger declined last month to say when he planned to offer a direct-to-consumer ESPN. It likely won’t be in 2023 or 2024, according to people familiar with the matter.

An ESPN spokesman declined to comment.

Discussions with the leagues

Iger wants to find minority partners to take equity stakes in ESPN. The sports network has held early talks with the National Football League, Major League Baseball, and the National Basketball Association on the concept, CNBC reported last month.

The National Hockey League has also been involved in these conversations, according to people familiar with the matter. An NHL spokesperson declined to comment.

Selling a part of ESPN to four professional sports leagues would be unprecedented. The leagues are focused on transitioning their products to a streaming-dominated landscape. Taking a stake in ESPN and having the network’s expertise in building an all-sports subscription service could help the leagues create a unified product and navigate the new economics outside of the traditional TV bundle.

But a deal might also irritate their existing media partners and create potential conflicts of interest. Leagues would have a vested interest in ESPN’s success if they owned equity stakes. That may not help the leagues maximize sports rights valuations, which have traditionally risen due to bidding wars among media and technology companies such as Comcast’s NBCUniversal, Fox, Paramount Global, Warner Bros. Discovery, Apple, Alphabet and Amazon
.
If ESPN can’t find a suitable deal for minority partners, it has not ruled out a full spin of the network, according to a person familiar with the matter.

Iger has resisted spinning off ESPN in the past and told CNBC he wanted to stay in the sports business. Mayer, who was executive vice president of corporate strategy at Disney before running the streaming business, has been more open minded about spinning off ESPN when he previously worked at Disney, according to people familiar with the matter.

Mayer left the company in 2020 to take the CEO job at TikTok. He declined to comment.

Iger told Faber last month that he wasn’t “necessarily” interested in spinning off ESPN as a separately traded company. The focus for Mayer, Staggs and Pitaro is finding a way where Disney can keep a majority stake in ESPN, according to people familiar with the matter. Disney currently owns 80% of ESPN and Hearst holds 20%.

Iger is looking for partners who bring advantages to ESPN in either content or distribution. Still it’s unclear if another strategic company would have any interest in owning a minority stake in ESPN. If Disney is the majority owner, it would control the fate of the network.

 

[clarker99]

https://www.cnbc.com/2023/08/02/dis...-minority-partners-but-deal-wont-be-easy.html
Disney CEO Bob Iger wants minority partners for ESPN, but landing a deal won’t be easy
Published Wed, Aug 2 20231:52 PM EDT
Alex Sherman@sherman4949

Key Points

• ESPN has held talks with the NBA, NFL, MLB and the NHL on being minority partners in the network.
• ESPN likely will not launch a direct-to-consumer product before 2025, sources said.
• While Iger would prefer to keep a majority stake in ESPN, Disney executives would consider a full spin of ESPN if they can’t reach a deal to do so, according to a person familiar with the matter.

Disney CEO Bob Iger has taken the unusual step of paying former executives Kevin Mayer and Tom Staggs a consulting fee to help him solve a complex problem: what to do with ESPN.

Mayer and Staggs are the co-CEOs of Candle Media. Both men are close with Iger and have served as informal advisors to him in the past. They’re working with ESPN President Jimmy Pitaro on the strategic options for ESPN and, to a lesser degree, Disney’s other linear cable networks.

Iger is looking for new ways to jumpstart ESPN because the rate of U.S. cable cancellations has accelerated. In years past, ESPN could still generate revenue growth by increasing programming fees for pay TV distributors, such as Comcast, Charter and DirecTV.

That dynamic no longer exists. As ESPN revenue declines, it will become a larger anchor on Disney’s earnings. That has prompted Iger to explore different strategic alternatives.

Iger told CNBC’s David Faber last month he has had become more confident about when ESPN will launch a direct-to-consumer product. ESPN’s best programming is still exclusive to the linear cable TV bundle. Disney offers many of its lower-rated live games on its ESPN+ streaming service, which costs $9.99 per month.

When ESPN does decide to offer an unbundled subscription service, it will likely cause even more people to cancel pay TV. That’s why ESPN has waited so long to go direct to consumer.

Iger declined last month to say when he planned to offer a direct-to-consumer ESPN. It likely won’t be in 2023 or 2024, according to people familiar with the matter.

An ESPN spokesman declined to comment.

Discussions with the leagues

Iger wants to find minority partners to take equity stakes in ESPN. The sports network has held early talks with the National Football League, Major League Baseball, and the National Basketball Association on the concept, CNBC reported last month.

The National Hockey League has also been involved in these conversations, according to people familiar with the matter. An NHL spokesperson declined to comment.

Selling a part of ESPN to four professional sports leagues would be unprecedented. The leagues are focused on transitioning their products to a streaming-dominated landscape. Taking a stake in ESPN and having the network’s expertise in building an all-sports subscription service could help the leagues create a unified product and navigate the new economics outside of the traditional TV bundle.

But a deal might also irritate their existing media partners and create potential conflicts of interest. Leagues would have a vested interest in ESPN’s success if they owned equity stakes. That may not help the leagues maximize sports rights valuations, which have traditionally risen due to bidding wars among media and technology companies such as Comcast’s NBCUniversal, Fox, Paramount Global, Warner Bros. Discovery, Apple, Alphabet and Amazon
.
If ESPN can’t find a suitable deal for minority partners, it has not ruled out a full spin of the network, according to a person familiar with the matter.

Iger has resisted spinning off ESPN in the past and told CNBC he wanted to stay in the sports business. Mayer, who was executive vice president of corporate strategy at Disney before running the streaming business, has been more open minded about spinning off ESPN when he previously worked at Disney, according to people familiar with the matter.

Mayer left the company in 2020 to take the CEO job at TikTok. He declined to comment.

Iger told Faber last month that he wasn’t “necessarily” interested in spinning off ESPN as a separately traded company. The focus for Mayer, Staggs and Pitaro is finding a way where Disney can keep a majority stake in ESPN, according to people familiar with the matter. Disney currently owns 80% of ESPN and Hearst holds 20%.

Iger is looking for partners who bring advantages to ESPN in either content or distribution. Still it’s unclear if another strategic company would have any interest in owning a minority stake in ESPN. If Disney is the majority owner, it would control the fate of the network.

In terms of how well ESPN is doing financially, we really will not know until FY24 when they break ESPN out in earnings. I have a hard time believing that they are exposing ESPN because it is doing poorly.

 

[wabbott]

In terms of how well ESPN is doing financially, we really will not know until FY24 when they break ESPN out in earnings. I have a hard time believing that they are exposing ESPN because it is doing poorly.

It will be interesting to see how well/poorly ESPN does on its own. It is notable that DIS appears to be having trouble attracting suitors to do a deal. Might that be a hint?