So much for CEO Jeffrey Katzenberg’s prediction that Turbo would be profitable. DreamWorks Animation‘s shares are down 5.6% in post-market trading after releasing a Q4 earnings report that includes a $13.5M impairment charge, equal to 12 cents a …
If you can imagine a hybrid of Saturday Night Live‘s “Weekend Update” with a traditional weekday late-night show, then you have a pretty good idea what to expect from the first half-hour of the first Late Night With Seth Meyers on NBC. The former SNL star came to his debut show armed with lots of topical jokes following an opening that showed him writing a Thank You note to his predecessor, Jimmy Fallon, vowing to treat Late Night “with respect and dignity and to only use it for original comedy pieces … starting now.” Later he said that he’s going to “shake stuff up and open this thing with a monologue,” in which he poked fun at the Olympics and Toronto Mayor Rob Ford and riffed on odds and ends from the news including a 101-year-old man running for Congress. (He “has a good chance of appealing to younger voters because that’s all there is.”) Meyers’ former SNL colleague Fred Armisen does double duty as a leader of the 8G Band and comic sidekick.
The program has several similarities with Fallon’s new Tonight Show, in addition to the fact that both are based in New York. There’s lots of wood in the new set that, with its simple, blue-hued panels, seemed to have been been ordered from Ikea. Also, like Fallon, Meyers kicked off his show without irony thanking Fallon, his parents, his brother, and his wife. He introduced a routine called “Venn Diagrams” in which Meyers finds common ground in two seemingly unrelated subjects. For example, snow and toilet paper are “things you won’t find in Sochi,” and Russia and the NBA are both “places that are more gay-friendly than Arizona.” Meyers loaded up on Olympics gags, including a bit poking fun at Bob Costas’ bout of pink eye.
What goes up must — keep going up? That’s what investors seem to think about Netflix, even after it unveiled a “mutually beneficial interconnection agreement” with Comcast widely believed to include payments to guarantee that its broadband customers receive “a high-quality Netflix video experience for years to come”. Share prices for the market’s biggest gainer in 2013, with stock values +312%, are up another 21.4% so far in 2014 — and touched yet another new high today at $449.69. The price retreated a little to close at $447, +3.4% on the day. Investors believe that Netflix used its leverage to influence Comcast’s $42.5B deal to buy Time Warner Cable to negotiate payments that will be low enough to keep profits growing and high enough to help it dominate rivals. “Few others can match [Netflix's] spend without incurring massive losses,” Janney Capital Markets’ Tony Wible says. Barclays Capital’s Kannan Venkateshwar also sees the deal as a positive for Netflix, even though this is “the first time in the cable industry’s history a content provider will pay for direct access to the [broadband] pipe.”
UPDATE, 1:01 PM: People who want to subscribe to WWE Network should be able to do so now that the company’s technology partner, Major League Baseball Advanced Media, has worked through the launch-day crush. Demand for subscriptions “exceeded …
Studios’ failed effort in 2012 to promote the Stop Online Piracy Act (or SOPA) made it clear: Big Media companies had better not mess with Silicon Valley. Too many people love the Internet, and they’ll crush anyone deemed to be a threat to the medium by its biggest service providers including Google, Apple, Facebook, Yahoo, and Netflix. That’s why Comcast needs to make peace with tech companies as the cable giant promotes its planned $42.5B acquisition of Time Warner Cable — and suggests that the new interconnection deal with Netflix is the first of many agreements with tech world Goliaths. If they’re unhappy, then they may embolden Washington regulators reviewing the TWC acquisition to demand a long list of concessions –and under extreme circumstances could even block the deal.
While terms with Netflix weren’t disclosed, the agreement will ensure that Comcast’s broadband customers receive, as the companies put it, “a high-quality Netflix video experience for years to come.” Bernstein Research’s Carlos Kirjner says this morning that he’d be “surprised” if the Comcast-Netflix agreement “was not conditional on a tacit (if not explicit) agreement by Netflix not to lobby regulators” to demand detailed promises to protect Internet access. Others, including Stifel analyst Benjamin Mogil, are waiting to hear about additional terms with Netflix, including a promise to add the service to Comcast’s set top box so subscribers don’t have to switch to a different input when they want to watch the streaming service on their TV sets.
In this week’s podcast, Deadline’s Executive Editor David Lieberman and host David Bloom examine whether Facebook paid too much with its $19 billion purchase of messaging service WhatsApp, ponder whether anyone should pay for the maker of blockbuster mobile game Candy Crush Saga now that it’s filed for an IPO, consider the impact of the FCC’s replacement net-neutrality rules and look at the real motivations behind the clamor for Google Fiber.
The stock is up 7.5% to about $18 after G Asset Management disclosed that it has offered to pay $22 a share for 51% of the retail book chain — or $5 a share for 51% of the …
Those who follow Dish Network have their work cut out for them this morning as they try to make sense of the company’s year end report. It offers a full report for 2013, but just selected results for Q4 — …
While he hasn’t decided whether to oppose the deal in Washington, DirecTV CEO Mike White says Comcast’s $42.5B pact to buy Time Warner Cable would result in “unprecedented media concentration in one company.” The No. 1 satellite service provider is “still assessing some of the competitive implications” but White wants to “ensure it’s appropriately scrutinized” — especially the “effective broadband monopoly they might have in two-thirds of the country.” The owner of NBCUniversal also would have a lot of power to raise content prices. That “creates some significant changes in the competitive landscape that we have to think hard about.” Couldn’t Comcast use its clout, with 30M subs after a merger, to slow the rate of increase in programming costs? Perhaps, but “it’s a complicated dynamic because that leverage may not flow through to its competitors.”
White says he’ll continue to resist high programming costs.”None of our customers have an income like those of us on the call here.” He wouldn’t comment on the state of the carriage negotiations with The Weather Channel, which went dark on DirecTV in January, but says that his company “may have lost a few thousand customers in the first quarter” due to the dispute. “Fundamentally I continue to believe if your viewership goes down ….that should be reflected in the price.”
Will this provide another incentive to cut the pay TV cord? The new venture, called 120 Sports, vows to offer Internet users a lineup of two-minute segments with “timely, interactive narratives of the stories around sports, including game footage, analysis, conversation and social commentary.” The goal it to make it relevant for live sports, not just to serve as a collection of highlights. It’ll be free, but a premium product will be offered next year. MLB Advanced Media will provide the technology muscle and is a partner in the venture along with Time Inc — the publisher of Sports Illustrated — and the NHL, NBA, NASCAR and leading collegiate conferences. Another partner, Chicago-based digital media company Silver Chalice, will handle business operations with help from Sports Illustrated, and produce the programming from a production facility on the Harpo Studios campus. Other partners will be named later. Time Inc points to 120 Sports as the kind of forward-looking initiative it can build as the magazine company prepares to stand on its own following the spinoff from Time Warner to take place by mid-year.
That’s the question investors are struggling to answer this morning as they recover from the shocking news last night that Facebook agreed to pay $16B (or $19B if you include some restricted stock) for WhatsApp. Analysts like the broad appeal of the messaging service which uses the Internet, as opposed to phone networks, to easily work with different platforms at a low cost — it can take the place of Apple’s iMessage, Google Hangouts, and Blackberry BBM. An average of 450M people used WhatsApp in December, and the number is growing at a rate of 1M a day. (It’s free for the first year, and costs 99 cents a year after that.) But the service would have to generate $1B a year in cash flow to justify the price tag, and “few data-points to support such an assumption were provided by the company, as evidently few are available,” Pivotal Research Group’s Brian Wieser says. It’s not clear how much cash it can generate: Execs said last night that they won’t sell ads on WhatsApp. As a result, “it is not hard to come up with plausible assumptions that suggest the price is 50% too high…or too low,” says Bernstein Research’s Carlos Kirjner. While he says it was strategically sound for Facebook to take the gamble, the deal also suggests a potentially worrisome degree of self-doubt — that the company didn’t think it could replicate WhatsApp’s success for less than $19B. Others who feel warmer about the acquisition say that other metrics justify the high price.
Facebook shares are down in after-hours trading after it announced the startling stock and cash deal for the mobile messaging service — the biggest acquisition it has ever made. The companies say that the combo will help them “bring more connectivity and utility to the world by delivering core internet services efficiently and affordably.” Facebook CEO Mark Zuckerberg says WhatsApp “is on a path to connect 1 billion people. The services that reach that milestone are all incredibly valuable.” Facebook plans to keep WhatsApp’s “core messaging product” and Facebook’s Messenger separate for now. “Here’s what will change for you, our users: nothing,” WhatsApp says in a blog post. Facebook also will maintain WhatsApp’s brand and keep its headquarters in Mountain View, CA. Co-founder and CEO Jan Koum will join Facebook’s board. The companies expect the deal to close later this year. If it doesn’t, then Facebook will have to pay a break-up fee of $1B in cash, and give WhatsApp $1B worth of its stock. The $16B price suggests that What’sApp is just $1.5B less valuable than Sony, based on its market cap, and more than twice as valuable as Gannett or Pandora. The purchase price consists of $4B in cash and $12B in Facebook shares. In addition, Facebook has agreed to give $3B in restricted stock units to WhatsApp’s founders and employees. They will vest over four years after the deal closes. This is believed to be the biggest deal yet for a start-up backed by a venture capital firm, Sequoia Capital. It says on a blog post that “WhatsApp has tapped into our insatiable appetite for personal communication. It is part of a chain that over the past 150 years reaches from the Pony Express, Telegraph and airmail letter to the telephone and email.” The messaging firm has just 32 engineers, and has an uptime of more than 99.9% “so users can rely on WhatsApp the way they depend on a dial-tone.”
Here’s the release: