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   Technology StocksNetflix (NFLX) and the Streaming Wars

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From: Glenn Petersen7/20/2021 5:53:38 PM
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Netflix beats on paid subscriber growth, but misses earnings expectations

Jessica Bursztynsky @JBURSZ


-- Netflix reported earnings that missed on the bottom line.

-- The company’s revenue and global paid net subscriber additions beat estimates.

-- The streaming giant also confirmed it was expanding into gaming.

Shares of Netflix recovered from an initial dip and were flat after the bell Tuesday after the company reported earnings that missed on the bottom line. The company’s revenue slightly beat estimates, and it confirmed speculation that it will expand more into gaming.

Here’s what the company reported versus expecations:

Earnings per share (EPS): $2.97 vs $3.16 expected, according to Refinitiv survey of analysts

Revenue: $7.34 billion vs $7.32 billion expected, according to Refinitiv

Global paid net subscriber additions: 1.54 million vs 1.19 million expected, according to Street Account

Analysts hadn’t been expecting a blockbuster quarter when it comes to subscriber adds, expecting 1.19 million users according to Street Account. The company said it added 1.54 million users to finish the quarter with over 209 million paid memberships.

“COVID has created some lumpiness in our membership growth (higher growth in 2020, slower growth this year), which is working its way through. We continue to focus on improving our service for our members and bringing them the best stories from around the world,” the company said in a letter to investors.

Netflix said its revenue growth this past quarter came from an 11% increase in average paid streaming memberships and 8% growth in average revenue per membership.

Most eyes were on what Netflix anticipates for its third quarter. Netflix said it expects 3.5 million net adds, while investors had anticipated 5.46 million net subscriber additions in the third quarter, according to Street Account data. Much of the optimism comes from Netflix’s upcoming slate of content, as a large amount had been pushed back into the second half of this year and next year.

In the first half of this year, Netflix said it has spent $8 billion in cash on content and expects content amortization to be around $12 billion for the full year.

“If we achieve our forecast, we will have added more than 54m paid net adds over the past 24 months or 27m on an annualized basis over that time period, which is consistent with our pre-COVID annual rate of net additions,” the company said.

The company confirmed it was pushing into the gaming space, as well. Netflix said it views gaming as a new content category, comparing it to its expansion into original films, animation and unscripted TV.

Potential games will be included in Netflix subscriptions at no additional cost, the company said. Initially, the focus will be on mobile games.

“We’re excited as ever about our movies and TV series offering and we expect a long runway of increasing investment and growth across all of our existing content categories, but since we are nearly a decade into our push into original programming, we think the time is right to learn more about how our members value games,” the company said.

The company recently hired video-game executive Mike Verdu from Facebook, where he was vice president of augmented reality and virtual reality content, as the company makes a deeper push into gaming.

Netflix is also facing pressure from tough year-over-year comparisons, since last year consumers were in the midst of the Covid-19 pandemic and spent much more of their time online and in need of entertainment.

Netflix said that in its second quarter, its engagement per member household was down compared to last year, but was still up 17% compared with the second quarter of 2019.

“The pandemic has created unusual choppiness in our growth and distorts year-over-year comparisons as acquisition and engagement per member household spiked in the early months of COVID,” the company reported.

This story is developing. Please refresh for updates.

Netflix (NFLX) Q2 2021 earnings (

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To: Glenn Petersen who wrote (2047)7/20/2021 11:52:03 PM
From: Sr K
1 Recommendation   of 2258
Thinking the WSJ version (excerpt) may be more numeric or different, here it is

Netflix Signals No Acquisition Plans as It Adds 1.5 Million Subscribers

Streaming giant’s U.S. member base shrinks even as it beats global growth forecast, says it sees no ‘must-have’ assets despite rival deal-making

Ralph Macchio and Martin Kove in a scene from the series ‘Cobra Kai.’PHOTO: CURTIS BONDS BAKER/NETFLIX/EVERETT COLLECTION

Joe Flint

Updated July 20, 2021 7:08 pm ET

Netflix Inc. is staying out of the arms race.

The streaming giant told investors Tuesday that while its competition is growing and rivals are combining to create more formidable entertainment platforms, it sees no need to get bigger to compete.

“We don’t view any assets as ‘must-have’ and we haven’t yet found any large scale ones to be sufficiently compelling to act upon,” Netflix said in its second-quarter letter to shareholders.

The company said that the potential of streaming is driving the deal-making but that it doesn’t believe the media consolidation of the past several years has affected its growth.

“We are mostly competing with ourselves to improve our service as fast as we can. If we do that, we’re confident we can maintain our strong position and continue to grow nicely as we have been for the past two-plus decades.” Netflix said.


This is full

Netflix Signals No Acquisition Plans as It Adds 1.5 Million Subscribers

Streaming giant’s U.S. member base shrinks even as it beats global growth forecast, says it sees no ‘must-have’ assets despite rival deal-making

Ralph Macchio and Martin Kove in a scene from the series ‘Cobra Kai.’PHOTO: CURTIS BONDS BAKER/NETFLIX/EVERETT COLLECTION

Joe Flint

Updated July 20, 2021 7:08 pm ET

Netflix Inc. NFLX -0.23% is staying out of the arms race.

The streaming giant told investors Tuesday that while its competition is growing and rivals are combining to create more formidable entertainment platforms, it sees no need to get bigger to compete.

“We don’t view any assets as ‘must-have’ and we haven’t yet found any large scale ones to be sufficiently compelling to act upon,” Netflix said in its second-quarter letter to shareholders.

The company said that the potential of streaming is driving the deal-making but that it doesn’t believe the media consolidation of the past several years has affected its growth.

“We are mostly competing with ourselves to improve our service as fast as we can. If we do that, we’re confident we can maintain our strong position and continue to grow nicely as we have been for the past two-plus decades.” Netflix said.

Netflix’s declaration came as the company said it added 1.5 million memberships in the second quarter as the streaming giant continues to see slower growth in new subscribers following a surge last year at the height of the Covid-19 pandemic.

Netflix said the pandemic had created what it called “lumpiness” in its membership growth, referring to higher growth last year and slower growth this year. The company said it has 209.2 million subscribers world-wide. Shares were flat in after-hours trading.

The global leader in streaming’s approach to acquisitions is the opposite of the rest of the entertainment industry, which is in a frantic phase of deal-making in the hopes of assembling content giants that can be formidable rivals to Netflix.

In May, AT&T Inc. and Discovery Inc. agreed to combine their media operations into a new stand-alone company whose assets will include HBO Max, CNN, Discovery+ and the Warner Bros. movie and TV studios. Last month, Inc. struck a deal to acquire MGM for $6.5 billion in the hopes of using the famed movie and TV studio’s library and intellectual property to bolster its Prime Video streaming service.

The deal-making might not be finished. Comcast Corp. , parent of NBCUniversal and ViacomCBS Inc. have discussed creating a streaming partnership for international markets, according to people familiar with the matter.

While Netflix is steering clear of deals, it is looking to expand into new businesses, particularly gaming. Last week, the company hired Facebook executive Mike Verdu as vice president of game development. The company said it would focus on games for mobile devices and would likely rely on Netflix shows and movies for content. Games will be included at no extra cost to Netflix members.

“We think the time is right to learn more about how our members value games,” the company said in its shareholder letter.

Netflix Chairman and Co-Chief Executive Reed Hastings said on the company’s investor video Tuesday that games and other ancillary businesses that the company is exploring, such as retail, aren’t meant to be new profit centers or to take away from its content operations.

“We’re a one-product company with a bunch of supporting elements,” Mr. Hastings said.

Netflix’s addition of 1.5 million subscribers for the three-month period ending June 30 exceeded its earlier forecast of an additional one million memberships. It added 10 million in the second quarter a year earlier, when much of the world was in lockdown mode.

Total revenue at the Los Gatos Calif.-based company rose to $7.34 billion, compared with $6.15 billion a year earlier. Wall Street had expected $7.32 billion, according to FactSet.

Profit at Netflix increased to $1.35 billion, or $2.97 a share. A year earlier, earnings were $720 million, or $1.59 a share. Earnings missed estimates for GAAP earnings of $3.18 a share.

The Asia Pacific region was the company’s strongest in terms of new members, responsible for nearly 70% of the 1.5 million added subscribers. In the U.S. and Canada, the streaming giant lost 400,000 subscribers—the first time it has done so in those markets since the second quarter of 2019.

Engagement among Netflix subscribers was also down for the quarter compared with the same period a year ago. However, that metric was up 17% compared with the second quarter of 2019.

Netflix is anticipating a stronger third quarter as media-production delays ease and more fresh content is available. The company said it is forecasting paid net additions of 3.5 million, compared with 2.2 million in the third quarter of 2020.

The pandemic continued to hamper Netflix’s lineup of original content for the quarter, but the company said it expects to have a strong slate for the rest of the year.

—Allison Prang contributed to this article.

Write to Joe Flint at

Corrections & Amplifications
In May, AT&T Inc. and Discovery Inc. agreed to combine their media operations into a new stand-alone company. An earlier version of this article incorrectly identified Discovery Inc. as Discovery Communications Inc. (Corrected on July 20, 2021.)

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From: Glenn Petersen7/21/2021 4:15:33 AM
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Potential consolidation:

Comcast and ViacomCBS face prisoner’s dilemma as they consider ways to work together

Alex Sherman @SHERMAN4949


-- Comcast and ViacomCBS are exploring ways to work together as they try to bolster their streaming services.

-- mA merger of NBCUniversal and ViacomCBS would have several obstacles, including potential divestitures and structure.

-- Both companies may decide to wait to try to merge with Warner Bros. Discovery.

The prisoner’s dilemma is a standard game theory situation often taught in business school. Comcast Chief Executive Brian Roberts and ViacomCBS chairman Shari Redstone are living it in real-time as they consider working together.

Comcast’s NBCUniversal and ViacomCBS are struggling to keep up with the biggest players in streaming video.

While Netflix, Amazon and Disney all have more than 100 million subscribers to their flagship video services, NBCUniversal’s Peacock has 42 million U.S. signups — most of which don’t pay for the service — and ViacomCBS’s Paramount+ has fewer than 36 million subscribers. ViacomCBS doesn’t reveal the specific amount of paying Paramount+ customers, but it said earlier this year it had 36 million total streaming subscribers, including Showtime and other niche products.

AT&T’s WarnerMedia and Discovery also have subscale streaming products. They announced plans to merge earlier this year. That left NBCUniversal and ViacomCBS as the largest leftover streaming players.

Roberts and Redstone have held conversations to explore ways the companies can work together, according to people familiar with the matter. Investment bankers are pumping both companies with ideas in hopes of getting what might be the last large traditional media merger fee for quite some time, said the people, who asked not to be named because the discussions are private. Spokespeople for Comcast, Redstone’s private National Amusements and ViacomCBS declined to comment.

One of the options under consideration is to bundle Peacock and Paramount+ together in international markets, as The Information reported earlier this year. Both companies are planning global expansions, and partnering is relatively frictionless.

Another option is a merger or acquisition, but there are numerous complications on that path. Neither ViacomCBS nor NBCUniversal are actively seeking a merger at this time, according to people familiar with the matter.

While there may be no rush to merge, both companies will ultimately need more scale to compete against larger players. They could partner or merge, or they could attempt to merge with Warner Bros. Discovery when/if that deal closes in the middle of 2022. A merger with Warner Bros. Discovery may be a cleaner fit for either ViacomCBS or NBCUniversal.

But only one of the two could join Warner Bros. Discovery. That would leave the other company out in the cold — possibly for years.

That’s the essence of the prisoner’s dilemma.

Working together may ensure both companies are better off than they started, but holding out against each other may be the best-case scenario for one company and the worst-case scenario for the other. (This isn’t a perfect prisoner’s dilemma example because the companies can’t really betray each other, ending up in a situation where both are worse off).

Merger issues

Regulators probably wouldn’t allow a combined NBCUniversal-ViacomCBS to own both broadcast stations NBC and CBS. It’s likely any merger will have to include a divestiture of one of the broadcast networks along with all local NBC or CBS television affiliates that overlap in the same markets.

That immediately diminishes the value of both companies. If CBS is divested, NBCUniversal would get Paramount+ without CBS programming, including live National Football League games and NCAA’s March Madness. If the companies decide to divest NBC, ViacomCBS wouldn’t get “Sunday Night Football” and other popular NBC broadcast shows.

While it’s possible the companies could attempt to argue broadcast networks are like cable networks and don’t need separate ownership, regulators may not view that as a reasonable argument. About 40% of Americans own a digital antenna to get free over-the-air programming along with streaming video, according to Horowitz Research. Broadcast networks have historically battled each other for valuable programming. Putting two under one roof would stifle those competitive bidding situations.

The second obstacle is structure. Comcast could simply acquire ViacomCBS, buying out Redstone’s voting shares in a deal. But ViacomCBS has an enterprise value of about $40 billion and would ask for a decent-size premium to sell, two of the people said. Even with major divestitures, a deal would be pricey.

Shari Redstone, president of National Amusements and Vice Chairman, CBS and Viacom, speaks at the WSJTECH live conference in Laguna Beach, California, October 21, 2019.
Mike Blake | Reuters

Comcast shareholders, who MoffettNathanson analyst Craig Moffett said are more likely to cheer a separation between NBCUniversal and Comcast, may not like a decision to buy ViacomCBS and divest one of the networks.

Roberts could spin out NBCUniversal and merge with it ViacomCBS — similar to the WarnerMedia-Discovery deal. That might require him to give up control of NBCUniversal. If Redstone ends up owning more economic control of a merged NBCUniversal-ViacomCBS, she may want to run the company or choose who’s in charge, for at least a number of years. Roberts and Redstone would have to reach an agreement on economic and voting control if this option is pursued.

A bundled offering through a commercial partnership skirts the merger and acquisition issues — and is ultimately the most likely “step one” scenario — but it gives less flexibility to the companies on offerings than a merger would. It also might not move the needle enough for either firm.

Wait for Warner Bros. Discovery

Either NBCUniversal or ViacomCBS could theoretically fit with Warner Bros. Discovery because David Zaslav’s future company won’t own a broadcast network. That would eliminate the need for divestiture. Combining with HBO Max and Discovery+ would also arguably be a more robust streaming offering, in terms of content, than simply pushing together the assets of NBCUniversal and ViacomCBS.

But the size of Warner Bros. Discovery combined with either ViacomCBS or NBCUniversal could pose regulatory issues, depending on how Biden administration regulators view the entertainment market. Even WarnerMedia’s deal with Discovery isn’t assured approval.

A choice to hold for a deal with Warner Bros. Discovery forces both NBCUniversal and ViacomCBS to wait two or three more years, given the length of time it would take to merge to gain regulatory approval — first for WarnerMedia and Discovery and then for the second merger. There would also be integration costs and issues from two large deals happening so quickly.

For the company that didn’t merge with Warner Bros. Discovery, the likely path forward would be rolling up some of the smaller streaming players. like Lionsgate and AMC Networks, or pushing for an acquisition of Sony Pictures.

Merging or waiting both present headaches. This is why investment bankers get paid the big bucks.

Disclosure: NBCUniversal is the parent company of CNBC.

Comcast and ViacomCBS consider partnership to bolster streaming TV (

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From: Glenn Petersen7/29/2021 11:37:30 AM
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Peacock Reaches 54 Million Sign-Ups, Set to Begin International Rollout on Sky Platform

By Cynthia Littleton
July 28, 2021

NBCUniversal’s Peacock streamer will begin its international rollout this year as a free addition on Sky’s satellite TV platform in Europe, giving it a base of 20 million households.

Peacock has reached 54 million total signups since its debut in April 2020. It generated more than 20 million monthly active users for the quarter. The streamer’s most popular original series has been the drama “Dr. Death,” Comcast chairman-CEO Brian Roberts told Wall Street analysts Thursday on the company’s earnings call.

And at a time media merger activity is heating up, executives from Comcast sought to throw cold water on the notion that the Philadelphia entertainment giant might be looking to do a transformative new deal.

“We have all the parts,” Roberts said, to emphasize that Comcast doesn’t need to go shopping for assets to maintain its heft.

Executives suggested that Comcast has enough scale in the marketplace to operate going forward, even as rivals start to bulk up. AT&T is set to spin off WarnerMedia next year so that it can merge with Discovery and Amazon has made plans to acquire the MGM studio. Those moves have spurred speculation that Comcast, which has over the years grown by buying up cable assets formerly part of AT&T as well as NBCUnversal and Dreamworks Animation, might seek to join with a rival, such as the new Discovery/WarnerMedia combination or even ViacomCBS, even though some of those deals would trigger intense regulatory scrutiny, as a single company is barred by FCC rules from owning two national broadcast TV networks.

During the call, Roberts and NBCUniversal CEO Jeff Shell told investors that the company saw no pressing need to grow larger. “This company is well positioned, and I really feel that way,” said Roberts. Both suggested that Comcast and NBCU would be most interested in buying assets that help the company grow overseas.

The theme park businesses that were so hobbled by the coronavirus outbreak this time last year were a bright spot this time around. Shell enthused about the strong performance of the Universal Studios Orlando theme park for the quarter. He also noted that Universal’s theme park in Beijing is deep into the approvals process and is on track to open “in the next couple of months.”

As for Peacock, executives noted that the day-and-date debut of theatrical “Boss Baby 2” on Peacock and the Tokyo Olympics have also driven viewership and signups. Shell stressed that Comcast has the financial wherewithal to support Peacock.

“I don’t think we’ve ever lacked the capital to do what we need to do to grow our business,” Shell said. He pointed to the company’s recent $400 million deal for rights to “The Exorcist” novel, which NBCU intends to make into three feature films, two of which will premiere on Peacock. Shell said that deal was only possible because they have the Peacock platform to justify the investment, which he pointed to as another sign that Comcast has the juice to go it alone.

“We can achieve our success at Peaock without anything additional and I think this quarter proved it,” Shell said.

Peacock Reaches 54 Million Sign-Ups, Will Roll Out on Sky Platform - Variety

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From: Glenn Petersen8/6/2021 5:00:27 AM
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‘Bridgerton,’ ‘The Dig’ Most Popular as Netflix Makes Major Gains in U.K., Finds Ofcom Study

By Naman Ramachandran
August 4, 2021

Some 52% of U.K. households have a Netflix subscription and 29 of the top 30 shows on subscription services in the first quarter of 2021 were on the giant streamer, a study has found.

The Netflix customer base now exceeds that of U.K. pay-TV providers combined for the very first time.

“Media Nations 2021,” the annual study of British viewing habits by U.K. media regulator Ofcom, reveals that the four most popular programs in the country were U.K. produced – “ Bridgerton,” “The Dig,” “Behind her Eyes” and “Fate: The Wynx Saga.” “Bridgerton” in particular, was a resounding success, with 8.2 million homes watching by the end of March 2021, making it Netflix’s highest reaching title that quarter.

Overall, U.K. subscriptions to streaming services climbed by over 50% in 2020 to reach 31 million, up from 20 million in 2019, the study reveals. The main streaming services gathered an estimated £2.11 billion ($2.93 billion) in U.K. revenues during 2020 — a 28% increase in real terms on 2019’s £1.66 billion –- and more than double their £1.03 billion revenues in 2017.

The study also records that by April 2021, streaming service providers were offering U.K. viewers a combined total of over 115,000 hours of content. Amazon Prime video’s catalogue was the largest at over 41,000 hours, followed by Netflix at around 38,000. The combined content catalogues of All 4, BBC iPlayer, ITV Hub and My5 were short of this at 37,000 hours.

The gains made by streamers has led to an erosion in broadcast television viewership, the study notes. The average time spent watching traditional broadcast TV each day in 2020 was 3 hours 12 minutes – nine minutes higher than in 2019. However, this increase was entirely driven by people aged 45 and over.

Younger age groups continued to watch less broadcast TV in 2020, with people aged 16-24 spending only an hour and 17 minutes watching broadcast content – down from one hour and 21 minutes in 2019.

Overall, the net effect was a fall in broadcast TV’s share of all adults’ total viewing in 2020, from 67% in 2019 to 61%.

Live sport, drama and news continues to be an audience draw for broadcast TV, with the most-watched program so far this year being the Euro 2020 soccer championship final between England and Italy with a combined audience of over 22 million U.K. viewers on BBC One and ITV. The Euro 2020 semi-final between England and Denmark had the highest audience on a single channel with 18.3 million U.K. viewers on ITV.

BBC One’s “Line of Duty” series finale with 16.4 million U.K. viewers and ITV’s Oprah Winfrey interview with Meghan Markle and Prince Harry with 14.9 million U.K. viewers were also popular broadcast TV draws.

The study also found that in 2020, where many months were spent in lockdown, U.K. adults spent 2000 hours, or more than a third of waking hours, watching TV and online video content.

Yih-Choung Teh, Ofcom’s group director, strategy and research, said: “The pandemic undoubtedly turbo-charged viewing to streaming services, with three in five U.K. homes now signed up. But with subscriber growth slowing into 2021 and lockdown restrictions easing, the challenge for the likes of Netflix, Amazon and Disney will be to ensure a healthy pipeline of content and keep customers signed up.”

'Bridgerton' Most Popular as Netflix Makes Gains in U.K. - Variety

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To: Glenn Petersen who wrote (2051)8/11/2021 4:59:05 AM
From: Glenn Petersen
1 Recommendation   of 2258
the Streaming Wars, Sony Stands on the Sidelines

As competitors are ‘beating each other’s brains out,’ the only major studio that’s not a combatant is finding ways to profit

By R.T. Watson
Wall Street Journal
Aug. 7, 2021 12:00 am ET

In Hollywood’s streaming wars, the only major studio that doesn’t have its own service might also be the biggest arms dealer on the battlefield.

Like its rivals, Sony SONY -1.71% Pictures Entertainment is bullish about the long-term prospects of the streaming business. Unlike the others, however, Sony’s management is betting on a strategy that involves selling films to longtime rivals that are spending billions of dollars to bulk up the offerings on their platforms.

Simultaneously, without its own large-scale streaming service, the Sony movie studio—owned by Sony Group Corp. —is gambling more heavily than its competitors on the return of moviegoing. Sony executives describe their commitment to theaters as part of a strategy for attracting talent and for securing high prices when they sell movies to streaming services, which often pay based on box-office revenue.

Rather than going head-to-head with Walt Disney Co. , Warner Bros., Universal Pictures and Paramount Pictures—all of which are trying to use movies they have produced to attract consumers to their own streaming services—Sony says it hopes it can play those counterparts against one another.

“None of them can deal with each other, but all of them can deal with us,” said Tom Rothman, chairman and chief executive of Sony Pictures Entertainment’s Motion Picture Group, adding that his company’s future will be well served by selling to rivals. “It’s certainly been a zigging-where-everyone-zags strategy. It’s proved very lucrative for us.”

Sony’s rivals believe their multibillion-dollar investments in streaming services will pay off in lasting ways. The growth prospects for Disney’s flagship Disney+, for instance, have propelled the company to the kind of stock-market valuation typically associated with the tech sector.

Sony’s handful of successful franchises in recent years has included a Jumanji reboot and its sequel. PHOTO: FRANK MASI/COLUMBIA PICTURES/EVERETT COLLECTION

Sony recently closed a pair of big deals, boosted by competitive bidding, to provide movies to the streaming services run by Netflix Inc. and Disney. Sony titles released over five years starting in 2022—including new Spider-Man films—will become available on Netflix after their theatrical runs, the companies said. Sony also agreed to give Netflix a first-look option to pick up movies the studio is making specifically for streaming platforms. Following their run on Netflix, according to a person familiar with the matter, Sony’s theatrical releases will then head to Disney which will be able to show them on its various distribution channels, including Disney+.

The Netflix and Disney deals, combined, are worth close to $3 billion over several years, according to a person familiar with the terms of the deal.

Sony continues to strike deals to make TV series that will run on various streaming services, including HBO Max and Netflix.

Sony was an early entrant in the streaming wars, launching the Crackle service the same year Netflix started its online offering. But the service didn’t become a serious contender, as Sony never made a massive investment in content. After Crackle struggled to attract top-tier programming or serious subscriber numbers, Sony sold control of the service in 2019 to Chicken Soup for the Soul Entertainment. It maintains some niche streaming offerings, including Funimation.

As streaming services proliferate and seek to stand out from the crowd, entertainment companies are spending unprecedented sums on making new content. Inc. recently agreed to pay $6.5 billion for the nearly 100-year-old MGM film and TV studio, which is expected to provide programming for the company’s Prime Video service. Actor and producer Reese Witherspoon’s production company, Hello Sunshine, sold for about $900 million. Her company adapts books into films and series like HBO’s award-winning “Big Little Lies.”

The upcoming ‘Venom: Let There Be Carnage’ is part of the studio’s plan to expand the Spider-Man series. PHOTO: MARVEL/ SONY PICTURES/EVERETT

Mr. Rothman, who recently extended his contract after six years on the job, argues that his company’s lack of its own streaming service could be an asset rather than a liability.

“It did become clear at a certain point that many companies were going to lose many billions of dollars beating each other’s brains out,” says Mr. Rothman.

Sony has often ranked last or second-to-last in box-office revenue among its peer group since 2013. But it nonetheless boasts an extensive library of hit movies and television shows, including Spider-Man, its most valuable franchise.

MoffettNathanson analyst Michael Nathanson believes Sony may have a competitive advantage not being pressured to sell movies to itself. “Talent will always question whether or not the internal transfer price was the right price,” he said.

The streaming push has already alienated some talent. Scarlett Johansson sued Disney last month for breach of contract, alleging that the company’s decision to release “Black Widow” simultaneously online and in theaters ate into her pay, which was partially tied to box-office revenue.

The risk for Sony, according to Mr. Nathanson, is that competitors might accumulate big enough war chests from subscription revenue that they could outspend the studio on entertainment production. That, in turn, could hamper Sony’s ability to attract high-profile projects and talent and potentially lead to a downward spiral.

Many in Hollywood predict that Sony’s recent round of deal making should provide sufficient capital to test its strategy for at least four years.

After that it is uncertain if Sony will be generating enough high-profile movies to secure lucrative licensing deals or have enough capital to pay the talent that drives success for most films at the box office.

Mr. Rothman, Will Smith, Martin Lawrence and fellow Sony Pictures executive Tony Vinciquerra, left to right, at the premiere last year of ‘Bad Boys For Life.’ PHOTO: KEVIN WINTER/GETTY IMAGES

The company’s chairman of distribution and networks, Keith Le Goy, says the studio’s lack of ties to any particular streaming service should also help it get the best prices for its movies and TV shows.

Sony’s sell-to-the-highest-bidder strategy is reminiscent of smaller production companies, like Ms. Witherspoon’s, that can take advantage of the current seller’s market for entertainment content.

“Our independence allows us every time to find the right home for any story, rather than being confined to the walled garden of our corporate siblings,” Mr. Le Goy said.

During Mr. Rothman’s tenure, the studio has released two Spider-Man films: “Spider-Man: Homecoming,” which grossed $880.2 million world-wide in 2017, and 2019’s “Spider-Man: Far From Home,” which made $1.13 billion. Another installment is slated for later this year.

Sony is trying to extend the franchise by plucking characters from the Spider-Man comics for villain-centered spinoffs such as “Venom: Let There Be Carnage” and “Morbius,” scheduled for releases this year and next, respectively.

Not all Sony’s franchise films have yielded box-office glory. The latest Men in Black and Charlie’s Angels films both underperformed in 2019. Sony racked up wins with two family-friendly Jumanji films and “Bad Boys for Life,” the Martin Lawrence-Will Smith reboot that was last year’s highest-grossing film in the U.S. and Canada.

Mr. Rothman argues that at its core, Hollywood is still primarily about producing entertainment that connects with consumers—whether on streaming services or in theaters.

“What I try to focus on is: ‘What is it people want to watch?’ ” he says. “That’s what’s going to matter.”

Write to R.T. Watson at

Corrections & Amplifications
Tom Rothman is chairman and chief executive of Sony Pictures Entertainment’s Motion Picture Group. An earlier version of this article incorrectly said he was chairman and chief executive of Sony Pictures Entertainment. (Corrected on Aug. 7)

Copyright ©2021 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Appeared in the August 7, 2021, print edition as 'The Switzerland Of Streaming.'

In the Streaming Wars, Sony Stands on the Sidelines - WSJ

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From: Glenn Petersen8/13/2021 3:58:44 AM
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Disney+ doubles subscriber base to 116 million in fiscal third quarter after release of Marvel’s ‘Loki’

Samantha Subin @SAMANTHA_SUBIN


-- Disney+ reached 116 million subscribers in the fiscal third quarter, beating analysts’ estimates by nearly 1.5 million.

-- That’s up from 57.5 million a year earlier.

-- The company also reported 174 million subscriptions across Disney+, ESPN+ and Hulu.

Disney+ reeled in new subscribers in the fiscal third quarter as consumers signed up to watch Marvel’s “Loki” and Pixar’s “Luca.”

Disney said in its earnings report on Thursday that subscribers to Disney+ doubled to 116 million subscribers from 57.5 million a year earlier. The results beat analysts’ average estimates by nearly 1.5 million, according to StreetAccount.

Across Disney+, ESPN+ and Hulu, Disney reported a total of 174 million subscribers. Disney also beat estimates on earnings and revenue, boosting the stock by about 6% in after-hours trading.

Analysts remain optimistic that Disney+ will reach its goal of 230 million to 260 million subscribers by 2024, as the company continues to roll out exclusive content. Consumers, however, are on average paying less. The average monthly revenue per paid subscriber for Disney+ fell to $4.16 from $4.62 a year earlier.

Among the most recent releases from Disney+ are the mini-series “The Falcon and the Winter Soldier,” based on Marvel Comics characters, and “Loki,” another Marvel-based series. The Pixar feature film “Luca” came out in June.

While the service is growing rapidly, it also faces a legal battle with “Black Widow” star Scarlett Johansson, who is suing the company for releasing the film simultaneously on the streaming platforms and in theaters.

Disney+ reaches 116 million subscribers after 'Loki' release (

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From: quantinvestor8/13/2021 6:16:37 AM
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Netflix down 10% year over year with revenues moving from $6.1B to $7.2B, Q2 eps $1.59 to $2.97. The rap has shifted from growth to margin expansion and free cash flow generation.

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From: Glenn Petersen8/13/2021 5:39:33 PM
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Disney wins this round: Here’s where the streaming giants stand at the end of earnings season

Alex Sherman @SHERMAN4949
Samantha Subin @SAMANTHA_SUBIN


-- Disney took home the prize as this earnings season’s big winner with strong Disney+ growth.

-- Netflix added just 1 million global subscribers but hopes for a rebound next quarter.

-- NBCUniversal added 12 million new Peacock sign-ups on the strength of the Tokyo Olympics.

This round, Disney beat Netflix.

Disney’s continued growth, juxtaposed with a disappointing quarter for Netflix, was the big story of this quarter’s earnings season.

Disney benefited from a handful of popular movies, including “Cruella” and “Luca,” that it placed directly on its Disney+ service in the quarter ended June 30, while Netflix is banking on a return to growth next quarter, when hit originals such as “Sex Education” and “Money Heist” return to the service.

Disney+ and Hotstar, Disney’s Indian streaming service, added 12.4 million new subscribers since last quarter, while Netflix added just 1 million new customers. Last quarter, Disney added almost 9 million new Disney+ subscribers and Netflix added about 4 million new customers.

“Last quarter, we had a little bit of weakness in streaming subs both at Netflix and Disney. The weakness continued for Netflix, but it didn’t for Disney,” Mark Zgutowicz, an analyst at Rosenblatt Equity Research, said in a CNBC interview. “Disney+ is about 90 million subs behind Netflix globally now. With this number today, it’s tracking toward a 20 million net add gain on Netflix this year.”

All of the big streaming video players have reported earnings this quarter. The following is a rundown of where all the major streaming services stand:


209 million global paying subscribers (up 1 million from last quarter)

73.95 million subscribers in U.S. and Canada

Average revenue per unit, or ARPU, for U.S. and Canada: $14.54


Disney+, including Hotstar: 116 million subscribers, $4.16 global ARPU (up 12.4 million from last quarter)

Hulu subscription video on demand, or SVOD, only: 39.1 million subscribers, $13.15 ARPU

Hulu SVOD+Live TV: 3.7 million subscribers, $84.09 ARPUESPN+: 14.9 million subscribers, $4.47 ARPU

Amazon Prime Video

More than 175 million Amazon Prime members have streamed shows and movies in the past year. No updates were given during second-quarter earnings.

Prime memberships cost $12.99 a month or $119 a year but offer many benefits other than streaming video — including free one-day or two-day shipping on most Amazon packages. Amazon does not break out ARPU by Prime members.


Apple TV+ subscribers: ? (No updates given during second-quarter earnings)


Apple’s free one-year trials to Apple TV+, which it gives away with new hardware such as iPhones, are now starting to expire for many customers, which could spur the company to offer an update on its next earnings call.

NBCUniversal’s Peacock

54 million “sign-ups” (up 12 million from last quarter)

More than 20 million monthly active accounts


Three tiers: Free with commercials, $4.99 a month for fewer ads and more content, $9.99 a month ad-free

Comcast’s NBCUniversal, the parent company of CNBC, successfully used the 2020 Olympic Games in Tokyo to push Peacock subscriptions. NBCUniversal will likely add more Olympics-related sign-ups next quarter, as it reported Peacock statistics only about halfway through the Games.

While the company has not released an official figure for ARPU yet, NBCUniversal estimated in January that Peacock would deliver $6 to $7 a month across its three tiers.

WarnerMedia’s HBO and HBO Max

67.5 million global subscribers (up 3.6 million)

47 million domestic subscribers (up 2.8 million)

ARPU: $11.90 domestically

AT&T raised its year-end global subscriber forecast for HBO Max to 73 million from 70 million in its second-quarter earnings statement. As of March, it expects 120 million to 150 million subscribers by the end of 2025.


More than 42 million subscribers across Paramount+, Showtime, Noggin, BET+ and other platforms (up about 6.5 million, the “overwhelming majority” of which came from Paramount+)

Over 52 million monthly average Pluto TV users (up 2 million)ARPU: ?

Average revenue per user remains a question mark for ViacomCBS, which has still chosen not to reveal the statistic.

“We’ve been on a journey of increased disclosure over time,” ViacomCBS CEO Bob Bakish told CNBC. “We will continue to evolve disclosure.”

18 million direct-to-consumer subscribers as of Aug. 3 (up 3 million)

Overall ARPU: about $7 per month ARPU for ad-supported Discovery+: more than $10 per month

28.9 million global subscribers (down 600,000), 16.7 million of which are streaming

ARPU: about $6 per month

Lionsgate’s Starz actually lost total subscribers in the quarter, though the decline relates to cancellations of the company’s linear service. Streaming customers rose 58% year over year to 16.7 million globally.

AMC Networks

Total subscribers: ?


A MC Networks said earlier this month it expects to have at least 9 million paid streaming subscribers across its platforms by the end of the year. The company’s flagship streaming product is AMC+, which may see a boost in subscribers after Verizon announced a deal with the company earlier this month that gives certain subscribers a free trial of the product for 6 or 12 months.
Disclosure: NBCUniversal is the parent company of CNBC.

Disney gaining fast on Netflix in streaming wars (

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From: TimF8/14/2021 5:41:09 PM
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Netflix VPN Crackdown Ensnares Those Who Aren't Even Using VPNs VPN providers are trying to trick Netflix's location-based restrictions by using residential IP addresses as proxies. But when Netflix blocks those IP addresses in response, it can spell trouble for the average ISP customer.
By Nathaniel Mott
August 12, 2021

Efforts by Netflix to stop VPNs from circumventing regional content restrictions may be having an unintended consequence, TorrentFreak reports: Limiting content access for those who aren't even using a VPN.

VPNs are commonly used to improve the privacy and security of internet connections that rely on public networks, like those found in coffee shops, hotels, and libraries. But an increasing number of VPN services have advertised their ability to make it seem like web traffic is coming from a certain location as a way to bypass streaming platforms' location-based restrictions.

Some VPNs do this by using residential IP addresses as proxies in a bid to trick streaming services like Netflix into thinking the connection is a viewer on their home Wi-Fi network. But cracking down on those IP addresses can block people who are not using a VPN from viewing Netflix's entire catalog.

TorrentFreak, which was tipped off to this issue by VPN provider WeVPN, cites numerous complaints on Reddit and Twitter. "The collateral damage is that you have hundreds of thousands of legitimate residential Netflix subscribers blocked from accessing Netflix’s local country full catalog from their home,” WeVPN tells TorrentFreak.

WeVPN—as well as rival services CyberGhost and Private Internet Access—have reportedly since come up with workarounds, according to TorrentFreak.

CyberGhost touts its ability to "help you access your favorite Netflix shows no matter where you are," though in our June review of the service, we could only stream Netflix Originals while connected to a New York-based VPN server, and we had the same problem when connected to one of CyberGhost VPN's servers optimized for Netflix streaming. More recently, we had no trouble streaming Netflix over a US-based Private Internet Access server.

We were not able to confirm how many people have had this issue, but Netflix says it's fixed the problem for those who reached out. The company does not ban VPNs outright, but if you use them, you'll be limited to Netflix Originals or other content Netflix is allowed to stream everywhere so as to avoid potential licensing problems.

If you're having this problem and have not been able to resolve it by contacting Netflix, the company also recommends contacting your ISP. As TorrentFreak notes, "one Redditor managed to get a new IP address from his ISP, which immediately resolved the problem."

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