ESPN’s John Skipper doesn’t see any benefits in new TV models – yet.
ESPN chief John Skipper is happy to talk to any of the so-called new over-the-top Web video players surfing around the fringes of the cable TV business. But he doesn’t see any major deals happening soon — if ever.
In a conversation with Reuters at this year’s cable show, Skipper was blunt about his skepticism over the idea his network – the best paid in the business according to SNL Kagan data — could work with a new Web partner, a tie-up that may in some way threaten the cozy $100 billion a year cable programmer-distributor relationship which feeds the entire industry.
“We have a significant stake in maintaining the current model. There’s no advantage to us in new models that undercut what we have today,” said Skipper, speaking from the NCTA Cable Show in Boston.
ESPN pays tens of billions of dollars every year in sports rights fees to major sports and college leagues — much of which is live programming that doesn’t lend itself naturally to the subscription video-on-demand model popularized by the likes of Netflix and Amazon, he points out.
The Disney-owned sports network is the envy of the cable television business, and several major rivals, like News Corp and Comcast Corp’s NBC Universal, would love to replicate its model.
Skipper was careful to play down recent bullish comments about ESPN’s strengths versus potential rivals. But he pointed out that, while he respects his rivals, it would be difficult for them to build a new sports network to the size, scale and fees that ESPN enjoys today.
He also disputed the idea that the rising cost of sports could one day see ESPN forced onto a sports tier.
Disney’s channel chief latest Mouseketeer to hit the road
For the second time this month, a senior Disney executive is heading for the exits.
The head of Disney Channels Worldwide, Carolina Lightcap, resigned from the company on Thursday after less than two years in the job overseeing the Disney Channel, Disney XD and Disney Junior cable networks.
Disney didn’t give a reason. In a statement released by the company, Lightcap said “the timing is perfect to move on to my next challenge.”
Lightcap started with Disney in Latin America and relocated to Los Angeles from Argentina for her current job. She spent 11 years with the company.
Gary Marsh, chief creative officer for Disney Channels, will take over Lightcap’s running of day-to-day operations while keeping his current role. Marsh is the creative force behind Disney Channel hits such as “Hannah Montana,” “High School Musical” and “Phineas and Ferb,” Disney/ABC television chief Anne Sweeney said in a statement.
Lightcap’s sudden departure follows the resignation this month of Andrew Mooney, head of Disney’s consumer products division. Mooney, a well-regarded executive who ran the unit for 12 years, said he was leaving to pursue leadership opportunities at other companies. No word yet on where he will land. Studio distribution chief Robert Chapek will fill Mooney’s job.
Tech wrap: AT&T preps plan to salvage T-Mobile deal
AT&T was expected to soon present a two-track plan that allows the company to try to find a settlement before the government lawsuit to block its planned $39 billion acquisition of smaller rival T-Mobile USA reaches the court. Details of AT&T’s proposed settlement were not available, but it is expected to include pledges to maintain T-Mobile’s relatively cheap mobile subscription plans, and asset sales.
TechCrunch founder Michael Arrington created a venture capital fund to invest in promising start-ups, sparking controversy over possible conflicts of interest involving the fund and questions about the integrity of the blog. Included in the debate was Arrington’s employment status, with one AOL spokesperson claiming that Arrington was no longer employed by the owners TechCrunch, and another claiming he was. Arrington’s creation of the “CrunchFund” comes months after he publicly announced that he had begun to actively invest in start-up companies, which also triggered a lively debate within the industry.
A senior exec from Acer said Microsoft will be the winner in Google’s buy of Motorola Mobility as the deal makes Google a direct rival to its phone-making clients. “They work against some of their clients,” said Walter Deppeler, president of Acer’s operations in Europe, Middle East and Africa. “It was a good gift to Microsoft,” he told Reuters. Acer uses operating software from both Microsoft and Google in its smartphones and tablets. Deppeler said Acer would consider the implications of the deal before deciding on future platform choices.
Pay-TV operator Starz Entertainment decided to stop providing its content for streaming on Netflix. Starz content includes exclusive rights to first-run Sony and Walt Disney movies and shows, but account for just 8 percent of U.S. subscribers’ viewing, Netflix said. Netflix shares ended the day down 8.6 percent. UBS analyst Brian Fitzgerald said the announcement underscores the long-term concern that rising content costs and increasing competition will continue to weigh on the company’s stock.
The New York Times, the Guardian, Der Spiegel, Spain’s El Pais and France’s Le Monde which collaborated with WikiLeaks condemned the website and its founder Julian Assange for making public thousands of “unredacted State Department cables, which may put sources at risk.” In a message posted on its Twitter feed, which Assange is believed personally to control, WikiLeaks confirmed on Friday it had released “251,287 US embassy cables in searchable format.” Earlier this week, WikiLeaks issued a lengthy statement accusing a Guardian journalist and a former WikiLeaks spokesman of having “negligently” disclosed top secret passwords to a copy of the cable database which had been floating, unnoticed, around the Internet for months.
Disney’s dodgy boyfriend problem
For the second time in just over a year another boyfriend of a Disney staffer has been accused of insider trading.
Yesterday, hedge fund manager Toby G Scammell (seriously, that’s his name, you couldn’t make this stuff up) was sued by Federal regulators who alleged he used secret information obtained from his girlfriend to make $192,000 off the Walt Disney Co’s $4 billion acquisition of Marvel Entertainment in 2009.
Scammell’s girlfriend of two years was an intern in Disney’s corporate strategy department and worked for six months on the deal.
Last year an executive assistant to Disney’s corporate communications head Zenia Mucha got caught up in a similar pile of insider mess. Bonnie Hoxie and her boyfriend Yonni Sebbag were sentenced earlier this year after sending emails and form letters to some 33 investment firms offering to sell inside information from Disney’s quarterly earnings and tips about plans to sell its ABC TV network to private equity firms.
Disney, known for its buttoned-down, loyalty-first corporate culture particularly under Bob Iger, might want to start researching staffers’ relationship status more deeply during the recruitment process.
GlobalMedia-iPad cautionary tale: What not to watch, up close
Media executives love to go on about their love of the Apple’s iPad. But the tablet isn’t suited for everything. Walt Disney’s Anne Sweeney relayed her recent experience catching up on an ABC TV show using the popular tablet.
Sweeney missed the season finale Grey’s Anatomy and, while traveling, decided to watch the show in her hotel room. The episode was particularly gory — several characters were picked off by a aggrieved man who held the hospital at gunpoint.
“It was a massacre,” Sweeney said at the Reuters Global Media Summit. “There’s nothing like seeing that on your pillow. There are some things you might not want to watch that close on your iPad.”
(Photo: Reuters)
GlobalMedia-ABC News in talks with Bloomberg
The news divisions at the big networks have been in a world of hurt lately as advertisers seek out younger consumers and viewers. This has lead to big cutbacks in staffing and resources over the years as the networks strive to keep profit margins from deteroirating even further.
ABC is certainly no expectation and has experienced managment upheaval when ABC News president David Westin announced in September his departure partly due to the financial situation and the pressure to increase profit margins.
Speculation has persisted that ABC News parent company, Walt Disney, has been seeking to untie itself from the division– rumors that similary dog CBS.
Anne Sweeney, president of Disney/ABC Television Group, flatly denied that the company was looking to offload the news or TV divisions but also confirmed that ABC News has been in talks with Bloomberg in forming a partnership. “We’ve had a lot of conversatoins with Bloomberg over the past couple of years,” she said during Reuters Media Global Summit.
Sweeney also said they are currently searching for Westin’s replacement though she was coy on when and who that might be. “We certainly have a lot of talent in ABC,” she said.
Social gaming — what the real players say
Social gaming is just barely old enough to be called an industry, but already the battle lines are emerging between major players Zynga, Playdom and Playfish.
Playdom and Playfish, since their acquisitions by the Walt Disney Co and Electronic Arts Inc respectively, have focused on bringing their branded intellectual property to the social gaming world. That could include a possible Playdom game with Marvel superhero characters, or the Playfish version of Monopoly now in the works (EA owns the digital rights to the board game).
Zynga is by far the industry leader in revenue and size, but it lacks the deep vaults of intellectual property that come with being part of a conglomerate such as Disney. So it has taken a different tack by focusing on marketing tie-ins with the likes of McDonald’s and convenience store chain 7-11. “One of the things that we really believe is going to happen is we think there is going to be much more connection between the virtual world and the real world,” Cadir Lee, chief technology officer for Zynga, told Reuters.
As Reuters reported on Sunday, the social gaming sector is bracing for a new wave of acquisitions.
With that development in the works, competition in social gaming continues apace.
Playfish, which was acquired by Electronic Arts in November 2009 in a deal valued at up to $400 million, has already rolled out social gaming versions of the popular EA sports games “FIFA Soccer” and “Madden NFL.” The company also has high hopes for its version of Monopoly due out later this year on Facebook, and it seems to be gunning for Zynga, which so far dominates the sector with its virtual harvest game Farmvilleplayed by 60 million users a month, according to Inside Network.
“If you look at games like Farmville for example by Zynga, they’ve dropped a third of their audience since their peak, and it shows that although those games have been highly successful, people do get tired of those games,” Sebastien de Halleux, Playfish’s co-founder, told Reuters. “If you’re looking at creating (game) categories, you’re looking for more than a one hit wonder,” he said.
Odd thing that all these Zynga and many other games, whether on Facebook or not, are described as “Social Games”. It’s a misnomer in most cases, because one is really just competing against oneself in most cases, but playing the game on a social networking site. That isn’t absolutely true, as there is some component of “sociality” in the notorious Farmville.
However, when I think of social gaming, I think of those Massively Mutliplayer Online Role Play Games, like World of Warcraft, or non-fantasy versions of the same.
Actually, the first thing that came to my mind when I read this headline about Social Games was Linden Lab’s Second Life. Imagine my surprise when I saw that the one other comment, by @zigojacko on 27 Oct 2010, made reference to Second Life as well! Not something I see very often! I smiled, and reminded myself to read Reuters online more often….
Hulu to charge? It’s getting closer…
Everybody loves free. But free has a price. And that price might just be $9.95 a month, according to The Los Angeles Times, which writes that Hulu, the second most popular video site in the U.S, will soon start charging for a premium version of its site called Hulu Plus. We haven’t been able to confirm the details yet (Hulu’s staffers are sticking to the ol’ decline to comment). But rumors of premium version of Hulu have been doing the rounds for the last year. Back in October an NBC executive said the company was experimenting with various business models, including subscription content.
Let’s also not forget Hulu is soon to be a third owned by Comcast (through its ongoing acquisition of NBC) — which is not known for giving video programming away for free. Its other parents, News Corp and Disney, also aren’t known for their charity in the video programming business.
And it’s not just Hulu, YouTube has also started to experiment with pricing models and has indicated it would be open to subscription models if its content partners asked for it.
Still, how will consumers feel about paying to watch their favorite shows online? And is there any chance a premium Hulu, when it becomes partly owned by a cable company, will undermine the TV Everywhere project? TV Everywhere offers ‘free’ online TV if you’re already a paying cable subscriber.
And, hey, $9.95 is a lot less than the average $60 most cable companies charge for a standard cable video package.
The audio compression is counter productive with me, I flip the channel immediately, and sometimes forget to come back.
Disney gives to those who give
Walt Disney Co on Tuesday launched a new parks promotion called “Give a Day, Get a Disney Day” pledging to give out a million free one-day tickets in 2010 to Orlando’s Walt Disney World Resort or Anaheim’s Disneyland to folks who volunteer in in their communities for a participating organization.
The media giant is working with HandsOn Network, the nation’s largest volunteer network and part of the Points of Light Institute, which has 250 on-the-ground volunteer action centers across the country and connects volunteers to more than 70,000 nonprofit agencies that need their help.
“We are thrilled at this unprecedented effort by Disney Parks to help mobilize 1 million volunteers into action,” said Michelle Nunn, CEO of Points of Light Institute.
Starting Jan. 1, 2010, guests can go here for the United States and Puerto Rico or here for Canada to search for volunteer opportunities available in those areas and sign up for a day of volunteer service.
For its latest reported quarter ended June 27, Disney showed it has stopped a recession-fueled free-fall in sales at its theme parks, but had not yet turned a corner to return to growth. Analysts said this latest promotion would help fill up parks and that Disney was more than likely to make up on lost admission revenues with merchandise and food sales.
“Disney parks margins have held up better than the last recession, as they have continued to raise prices over the years to offset their promotions. They make healthy margins on concessions, so even if they lose revenue from an entrance, they get an additional head that needs to eat and buy Mickey ears,” said David Joyce, analyst with Miller Tabak.
from DealZone:
Boys and girls, welcome to Disney’s Marvelous Media Machine
Walt Disney's $4 billion offer for Marvel Entertainment would give it more than 5,000 comic book characters, including such mighty heroes as Iron Man, Spider-Man, and the Fantastic Four. Disney's Bob Iger told CNBC that the expanded roster will help bring more boys to the home of the Magic Kingdom, where Snow White, Cinderella and the Little Mermaid have long reigned supreme.
The cash and stock deal values Marvel at $50 per share, or a premium of 29 percent to Marvel's closing stock price of $38.65 on Friday. The deal has been approved by the boards of both companies, and since Marvel's CEO, Isaac Perlmutter, is also the largest shareholder of the company, it's likely a done deal.
Marvel's second quarter was a mighty one. It beat market estimates on strong DVD and pay TV sales of "Iron Man," sending its shares to an all-time high. This year has been a lull for Marvel, with no new film releases due until 2010, when Iron Man 2 hits screens. Thor and the first Avenger movie, as well as Sony-produced "Spider-Man 4," are slated for a 2011 release and an "Avengers" sequel is due in 2012.
Is this a game changer for Disney's foes? Marvel rival DC Comics, with its stable of Batman, Watchmen and other, darker comic champions, is already a part of Time Warner. For the fantastic leap comic books have made to the big screen, this could be the last hurrah.
