☀️ Hollywood’s Streaming Ad Reach Problem
☀️ Hollywood’s Streaming Ad Reach Problem
PIXAR job cuts start / HBO gets Steve Carell comedy series / Theatrical gets action pic influx
Mornin! This is Sean McNulty (connect with me on LinkedIn here if ya like), and here’s the Hollywood + Media news to know on TUESDAY, May 21, 2024.
Where let’s all extend a hearty “Welcome to Hollywood!” to OPENAI leader Sam Altman . . . who I’d say is at the top of oh, 80% of newsletters this morning? And not in the good way.
Only a Silicon Valley entrepreneur would look at what happened to Bob Chapek in the whole Black Widow / Scarlett Johansson fiasco and say, “Hmm, how can I repeat that?”
The TL;DR according to Johansson:
Last year, OPENAI reaches out to Scarlett, the originator of the Her voice, to voice a new AI assistant for a new GPT-4o version. She declines.
OPENAI reaches out to Scarlett’s reps again this month to see if she’d reconsider a deal . . . just before it’s about to release the bot, named “Sky,” which by all accounts here sounds strikingly similar to Scarlett/Her.
OPENAI releases the bot without a formal response from Scarlett’s team just two days later anyway, with Sam Altman dropping this tone-deaf whopper of a tweet:
Scarlett then, uh, enlists some lawyers to send some letters, and lo and behold — OPENAI pulls “Sky,” saying that it’s doing so . . . and this phrasing is just so 🤌, “Out of respect for Ms. Johansson,” and noting that it did use another voice actress to create the bot. It’s a damn shame tweets live forever, isn’t it?
So, add Altman to the list of completely oblivious Silicon Valley execs who came to Hollywood with hat in hand under the auspices of collaboration, with that hat totally covering a 🖕.
Also seems like an appropriate time to repost this gem from the WSJ in March:
ELSEWHERE IN AI:
MICROSOFT is releasing a new line of computers where AI locally scans everything you do all the time (no cloud needed!), so you can just ask it to find “that PowerPoint with the fish in it,” as cited in the WSJ review, and voila! Instant 1984, right there in your hands! (guessing that won’t be the tagline — 1984 being APPLE’s milieu of course)
JP MORGAN is now training all new hires on AI, who are getting something called
“job replacement training”“prompt engineering training.”
UGH: PIXAR’s rumored 2024 job cuts are starting, with about 14% of the workforce being cut (roughly 175 folks) as DISNEY spending austerity hits the division.
THEN: A kudos to Nelly Korda for winning her 6th LPGA tournament in 7 outings this year 🤯, totaling nearly $3M in earnings so far (the next major is the Women’s U.S. Open next weekend on NBC).
PLUS: Anyone want to invest in a company that lost $327M in the first three months of 2024, on $770k in revenue? No, it’s not a streaming service #goodguess, but rather the parent company of TRUTH SOCIAL. Losses on an EBITDA basis were only $12M — but sadly EBITDA doesn’t change the uh, $770k in revenue in Q1 thing.
AND: ROKU is paying $30M for the 3 years of MLB Saturday morning games according to The Athletic (APPLE pays $85M for its Friday night MLB games).
OH: REDBIRD is reloading the dealmaking war chest . . . freshly raising another $4.7 Billion to pursue investments in more sports, media and financial services businesses. What’s that? Shari’s on line 1? Uh, I’m in a canyon — can’t talk.
AND: Costner says he spent $38M of his own money on the first two Horizon pics. The 3rd and 4th installments he’d like to do are not fully funded. Anyone have REDBIRD’s number?
SPEAKING OF MONEY WELL SPENT: Let’s just finish out the top here today with a couple of new stats about the economy at large:
This new chart from the NY Times pretty much sums up why the state of residential real estate is where it is, in one snapshot:
Locally here in NYC, the average worker makes about $89k a year. When factoring in things like a security deposit and broker fees, this average NYC worker can only afford . . . 4.4% of the apartments available in all of NYC according to ZILLOW, without breaking the recommended policy of spending no more than 30% of your total income on housing costs 🤯.
TARGET is actually cutting prices on over 5,000 household items to try and improve sales trends. TARGET’s annual sales fell last year for the first time since 2016.
Follow this up with the Q1 reports from MCDONALD’S, STARBUCKS and others about the troubling consumer spending trends they saw in Q1, and yeah — $22+ movie tickets in NYC probably aren’t helping the movie business either.
OH WAIT!
We now have a price for StreamSaver — the new NETFLIX, PEACOCK (ad tiers only) and APPLE TV+ bundle: $15 a month, again only for COMCAST customers.
That’s a $10 a month savings. Um 🙋♂️, why is COMCAST doing this?
COMCAST wants its customers streaming as much video as possible, so they pay more to increase their broadband speeds, and thus increase COMCAST’s profit margins . . . as the company’s broadband subscriber growth has come to a standstill, with no hope of growth on the near or mid-term horizon. So COMCAST is willing to take the 💰 hit to offer something like this.
The streaming business on the whole is all about ad-tier growth right now — well except APPLE TV+, which doesn’t have one . . . but I think we can all agree finding any subscriber growth is likely high on its priority list.
So — this bundle is another lever to pull to increase ad-tier scale . . . something that is largely lacking for advertisers.
Thus today, I take a look at both the likely sizes, and definite great disparity in ad-tier scale here as Upfronts negotiations continue and why this matters so much.
Turns out chasing the 2010s NETFLIX model continues to have repercussions . . . now having to rebuild the ad business being the latest.
📽 THE SILVER SCREEN
