ICYMI: Making Sense of Warning Signs
Catch up on The Ankler's recent best
Thanks for being part of The Ankler. It was a chaotic week: third-quarter earnings reports told repeated stories of a business struggling — ad declines, a shift from counting subscribers to actual profits, layoffs and hiring freezes from Amazon to Warner Bros. Discovery, and, as always, lots of cord-cutting.
We’d love to hear how you are processing all this change. To that end, we’re introducing two new features…
This Wednesday morning (the day after Election Day), subscribers will receive by email the chance to vote on a series of questions about one of the most important strata of people in this business: Agents and Managers. The first in our series of Ankler Polls will canvas for opinions about the percentary crew, on whose strategy and dealmaking careers will rise and fall during these tumultuous times. Who has the juice, who’s innovating and (yipes!) do you even need them? Tell us! The poll will be for paid subscribers only. Results and takeaways will be posted at a later date.
We’ve kicked off our first subscriber chat, available to paid subscribers who have the Substack app. We opened the comments to your thoughts and questions about the larger state of affairs in Hollywood. We invite you to download the app and dive into the conversation. We’d love to hear from you. Richard is in there responding.
Best of the Week
Richard took a look at everything Wall Street gets wrong about Hollywood, and how the industry is now paying the steep price for chasing its approval. He writes: “What we see now is the scales falling from the investors' eyes as they realize that Hollywood is what Hollywood has always been: a confounded money pit built around a business that makes less sense than a craps table. And the fact that Jeff Bezos wanted to hang out here may have less to do with him seeing an undervalued, disruption-worthy business, but more that he wanted to hang here for the same reasons that once drew Howard Hughes, Charles Bluhdorn, Edgar Bronfman, Jamie Packer and moguls since time immemorial.” Read it all.
Squid Game was supposed to have blown the door open for a new era of international content that could travel (fully amortized!) from market to market, driven by a finally subtitles-ready market. It was a core business model hailed by Netflix’s Reed Hastings, and emulated by Prime Video, Hulu and Disney. But one year later, the model has fallen short. Entertainment Strategy Guy writes, “My premise for today is to show you just how very badly, according to data, this strategy is playing out.” Read it all.
Bah Humbug! Making Sense of the Earnings
As usual, Sean McNulty of The Wakeup delivered must-read day-after analysis of those (largely grim) earnings calls.
WBD, Lionsgate: “Zaz drove home the notion he announced on the Q2 call… ‘Profitability is our benchmark for success.’ As to when the bench will be installed… don’t expect much for at least the next 9 months, and probably longer.” In other words, pain to come. Read it all.
Roku, WWE, Dish, Altice: “Roku was refreshingly frank that they’re essentially in for some tough quarters… and your guess is as good as ours on the U.S. economy…Roku stock was -16% after hours last night. It’s lost almost half of its value in the past 3 months.” Read it all.
Paramount: “The movie division is doing great, but Paramount is talking about the ad slowdown as if we’re in the middle of it… and not at the start. And yes, no one knows what lies ahead for 2023… but the big bet is a lot of down quarters. This is occurring as cord-cutting is really starting to have an effect on companies that still truly rely on it. There is no theme park business or broadband revenue here to offset [it].” Read it all.
Since departing CNN, the fate of Jeff Zucker has been up in the air. Tatiana Siegel broke the news of his likely next stop (later cited in the WSJ and Axios, among others). Check our report for all the details.
Streaming “clearly [is] not making money yet and will not for another two years if it even gets to that point for some of these companies,” said host Sean McNulty. The team laid out likely scenarios ahead —including the “twin apocalypse” of a recession and a writers guild strike. Listen here.
In an ode to line producers, Rob Long remembers an unsung hero of TV, Steve Grossman, a 35-year industry veteran (Newhart, Hope & Gloria, George and Leo, Love & Money, Lateline) who was the secret weapon for sitcom success — and to whom the industry recently bid farewell. Listen here.
Final note: there are a few seats left to hear Felix Gillette and John Koblin in conversation with Janice about their new book, It’s Not TV: The Spectacular Rise, Revolution and Future of HBO. The event, complete with some tasty hors d’oeuvres, will be held at Bloomberg’s Century City HQ on Tuesday, Nov 15 at 6pm. Click here to save your spot.