Month: July 2020

Most Important Story of the Week – 31 July 20: CAA Fires Some Agents…What Does it Mean?

Let’s zig while everyone else is zagging, shall we?

Sure, PVOD is officially a thing for one theater chain and one studio. But we knew a compromise was coming eventually. Meanwhile, I’m looking at the power brokers of entertainment for my story of the week.

Most Important Story of the Week – CAA Finally Lays Off Agents

When Covid-19 began it’s spread, everyone was impacted. Lots of companies had to furlough workers, cut hours, start work from home and begin to plan for a pandemic-impacted future.

The challenge is trying to figure out which impacts are temporary, and which could be permanent. (Which I’ve tried to do a few times.) 

In film and TV specifically, studios were hit with both supply and demand shocks: they couldn’t release films in theaters and had to stop production. The logical next step was for studios to severely curtailing deal making. Why spend money if you’re not making money? 

Unfortunately for Los Angeles–and similar regions around the globe–the Hollywood economy is like an ecosystem in the natural sense of the word. The studios are the plankton that feeds all the animals in the sea from theaters to cable channels to cable distributors to home entertainment video producers to independent PR shops to swaths of entertainment lawyers to unknown hordes of marketing consultancies to…agencies/managers.

I highlight that last group because of all the support groups it’s not clear that they have to exist. They do serve roles in the system and one could (maybe) make the case they even add value. But most industries work just fine without dedicated third parties hoarding/managing talent. (Head hunters exist, but are much less prominent in other industries.) 

Moreover, as time has passed and agencies have consolidated, their business model–being blunt–is much more about being gatekeepers who charge rents to reach talent than connecting the right people with the right projects. Gatekeepers then extract rents, which exceed their value and you can tell they’re succeeding because they build lavish offices and have enormous expense accounts. See CAA and WME.

Thus the news this week feels bigger than just “industry being impacted by Coronavirus”. Theaters are being impacted too, but most have reduced costs and will survive until a therapeutic or vaccine is developed. Cable TV made it through. Theme parks are reopening, though limited. Sports will see revenue cut in maybe half, but everyone will cut salaries and continue on.

At first, I would have said the same thing about agencies. The agencies matched other businesses by cutting hours and expense accounts. (Though honestly, who had meals to go to under quarantine?)

Now the agencies are laying off agents. Specifically, CAA is last to the party. “Laying off” is a step more dire than “furlough”. Agents could be furloughed if there is no work to do. Laying them off means, generally, that they can’t come back. While lots of businesses are laying off workers, an agency is literally only its workers! They don’t make or produce anything; without agents, an agency isn’t an agency!

This change is potentially seismic. 

If you have fewer people to make deals, it means you anticipate fewer deals to make in the future. One explanation could be that studios will pull back from making new shows. I don’t buy that at all, especially with the boom in streaming services.

Instead, the reality may be that we don’t really need agents, and the pandemic threw that into sharp relief. At least one group of talent proved that it doesn’t really need agents. (Or not agents from the two major firms.) The writers fired all their agents last year and still film and TV development continued. If agents are a vital cog in the machine, what to make of the fact that when that cog was removed for writers…nothing changed?

Let’s not overreact too much. It’s *only* 5% of the workforce that is being laid off and likely none of the top agents. (Furloughs are temporary so I’m less likely to consider that a permanent change.) Every other agency has already let go of their staff. Maybe this was as inevitable as AMC Theaters and Comcast coming to a deal. Or maybe I’m not going far enough: WME is a debt burdened goliath that failed to IPO and doesn’t actually have a strategy for the future.

If I’m a studio or production company, I’d look to a post-agent future. In addition to being gatekeepers, agents in a lot of ways are bad talent spotters. They send the same writers and same directors and same actors to development executives. This makes for so much of the dross that comes to screens. Worse, because they do all the packaging, many development execs have lost the ability to find great talent and great projects. (A role producers used to play more prominently in the system.) 

If a studio can re-develop the skill at developing projects–a role the agencies were happy to do for them for a fee–it could pay dividends.

The Next Most Important Story of the Week – Comcast-AMC Theaters Truce

It’s still a big deal! But in a change, I was asked to write my thoughts for Decider.  It’s a good one and may change how you look at this big news. (When that article goes up, I’ll provide a link.

Data of the Week – ESPN’s Huge Baseball Ratings

We have our first test of the thesis that Covid-19 changed everything. First up, sports. With everyone stuck at home, and experimenting with TikToks, Fortnites, and Twitches, maybe they’ve moved past live sports?

Well, not really

Screen Shot 2020-07-30 at 11.24.14 AM

My prediction is that when Lebron and the Lakers take on Kawhi and the Clippers last night for the NBA’s return it will set similar ratings. (This article was written before it happened.) 

Long term what are the impacts? Well, if sports dominate linear TV, they’ll become even more important to the cable bundle’s survival. Meanwhile, if sports really do grab the attention of 1/3rd to 1/2 of viewers, we could see viewership decline on the streamers, new channels and scripted cable/broadcast proportionally. Sports news websites should see a spike in traffic too. If the streaming wars are really the “attention wars”, then a new battleground of attention is returning.

M&A Updates

Antitrust hearings

There wasn’t a lot of news out of the antitrust hearings on capitol hill, besides headlines speculating this is a “Big Tobacco” moment. My overall takeaway is only one of two things can be true:

  1. The lead executives for major tech companies are surprisingly uninformed about large parts of their businesses. As such, they should be fired for incompetence and poor leadership. Tank their stocks!
  2. The executives were lying when they said they “couldn’t recall” many details about their companies.

Obviously, number 2 is true.

Don’t sleep on antitrust as the defining business issue of the 2020s. If breaking up conglomerates of all shapes and sizes becomes a trend, that will have ramifications up and down every value chain. Smart business leaders can strategize around that. But that’s a big “if”. 

M&A is Down for 2020 (duh)

One of my favorite corners was predicting in 2018 that M&A wouldn’t “explode” following the approval of the AT&T/Time-Warner merger. And indeed it remained mostly flat, and then got walloped by Covid-19. (Which does not count as something I predicted!) Here’s the table from PwC, recreated by Axios:

Screen Shot 2020-07-29 at 9.06.35 PM

While PwC provides the best in class data for M&A–I used it extensively back in 2018–their headline is straight boiler plate “this changes everything” unexplored assertion. Yawn.

Other Contenders for Most Important Story

HBO Max Got “4 Million” New Subscribers

On last week’s The Business Kim Masters pointed out that it’s unclear if 4 million additional HBO Max/HBO subscribers is good or bad news for AT&T. She’s totally right: if you don’t set expectations ahead of time, when you do get a data point, you end up fitting it into your pre-existing narrative. That’s bad.

Unfortunately, I didn’t follow this advice myself. I didn’t expect HBO Max to give us subscriber numbers so I didn’t plop down a forecast.

I do have a tentative prediction. For new services with brands like this, I’m beginning to see a curve I’m calling the “substack” curve. I call it that because I first saw it when a substack author showed their subscriber growth. If someone has a preexisting brand, then they sign up lots of people at first. Then it slows down, but often it picks up momentum later on. (My curve has done something similar, though my “brand” was still small at launch.) If you’re familiar with the typical S-curve/bass diffusion curve, this is almost the opposite: start out big, slow down, then accelerate later.

We’ve already seen this with Disney+, which added huge numbers in November–the brand!–and then slowly added folks and has likely seen a pick up with Hamilton, and will see more acquisitions with the big Marvel shows. HBO Max is on a similar path. Four million was the branding launch, and then it will slow down and they hope to add more later when the next Game of Thrones prequel comes out. 

In other words, we could read this as the HBO Max to Disney+ is about 40% of the value. My caveat? Most of HBO Max is just HBO, and 30 million folks already have that. Plus, Covid-19 killed any chance at a good, buzzy original series, which Disney+ had.

(The best read I came across this week was this Variety VIP article in front of their pay wall. Also, after I published this Peacock announced it had 10 million sign-ups. I’ll tackle that next week.)

Hulu Redesign

Folks seem to like Hulu’s redesign. Others have said it mirrors Netflix, which begs the question, “Do you like Netflix’s interface?” I think half of customers do and half don’t. Meanwhile, I just long for the streamer with the play list feature that most closely mirrors my current DVR. The DVR is the best UX period.

Tenet’s Latest Plan

Open worldwide end of August, and then Labor Day weekend where possible in the United States. Given this is fairly convoluted, it’s probably the most likely to stick. Also, Disney moved Mulan again, date unknown. It also pushed Star Wars and Avatar, but that has more to do with production being paused than theaters not being open.

Tom Cruise “Space” Movie Plans for a Theatrical Launch

Not the biggest story of the week, but it did cause me to pause. Cruise may just be risk averse for streaming, or maybe he knows he’ll get much bigger paychecks in theaters. I opt for the latter. (With the caveat that my favorite line in any story is “The movie is also said to not yet have a script.”)

Management Advice of the Week – Don’t Bring Your Laptop to Class (or Meeting)

One of the sections I’ve neglected in this newsletter is my management advice for entertainment professionals. Cleaning out links, I stumbled on this gem that still holds up.

Essentially, under experimental conditions, if you’re on a laptop you can’t pay attention as well to a lecture. Multiple studies back this experimental finding up and I’ve read studies extending it to smartphones.

So what can you do about it? Easy: don’t bring electronics to meetings. You’ll retain more information in the meeting and be more engaged. What about our coronavirus zoom world? Well, close every screen beside the open Zoom room and use a pad and paper to take notes/plan. 

Lots of News with No News – Emmy 2020 Edition

Every year the Emmys garner tons of news coverage and every year I tell you to ignore this shiny bauble. As nominations per category have generally increased, and studios compete in more and more categories, the odds that a studio sets a record for Emmy nominations increases, which Netflix did this year. However, this Variety chart was the most telling graph I saw:

Screen Shot 2020-07-30 at 9.07.13 AM

In other words, Netflix’s skill is buying shows in bulk; HBO’s and other traditional studios is making shows.

Read My Latest “5 Insights from Netflix’s Viewing Data for its Original Movies” at Whats-On-Netflix

If you’re up for some more Netflix data, I got you covered over at I essentially wrote up this long Twitter thread

…into a full-blown article for them. I added a section as well on genre films to show how dominate action films have been. Check it out. 

Most Important Story of the Week – 24 July 20: The Incredible Shrinking Libraries of Peacock and HBO Max

The initial draft of this weekly column went very long in the “data of the week” section. So long it’s going to be its own article next week. (It isn’t that time sensitive.)

Meanwhile, the biggest story is one of omission…

Most Important Story of the Week – The Incredible Shrinking Libraries of Peacock and HBO Max

While the entertainment press often stares at shiny objects–Tenet’s delayed again is the example this week–I still can’t quite believe my eyes on this one:

The Harry Potter films are leaving HBO Max in August!

I’ve been telling everyone that the streaming wars aren’t a sprint, they’re a marathon. Heck, they’re an ultramarathon. Just like (most) real wars. World War II wasn’t won on December 7th. (Fine, 26th of May 1940 for my UK readers.) It slogged on for half a decade more. The Vietnam War or Iraq War were twice as long at least. Historically, wars have gone even longer. (Like 30 or 100 year time spans!) Even the Galactic Civil War in Star Wars lasted ten years. 

Yet the newly launched streamers tried to win it on day 1. In addition to the departure of Harry Potter, we have…

– The Jurassic Park films are leaving Peacock this month for Netflix.
– The Hobbit films quietly left HBO Max sometime in July.
– The Matrix films are leaving Peacock along with some Fast and Furious films.
And more

As far as content planning goes, this is bad strategy. The thinking for the traditional streamers must have been that buzz would never be higher than launch, so the goal was to present the impression that there are tons of blockbuster movies. (Just like Disney+.)

Of course, when folks see tons of movies, they expect them to stay there. If they leave without similar high-powered replacements coming in, the result is disappointment. Traditional HBO knows this, which is why every Saturday they usually have a big new movie, but it leaves after a few months. (And why no defining films have left Disney+.)

Why haven’t they paid more to keep these buzzy films around? Traditional companies like making money. And Wall Street still expects them too. It’s cheaper to pay for a limited, non-exclusive streaming window measured in months (or even days) than to permanently end some of these lucrative exclusive linear deals in the United States. (TNT/TBS, USA Network/Syfy, and FX/FXX still pay handsomely for blockbuster films. So do Netflix, Hulu and Prime Video.)

Disney paid dearly to get nearly all their rights back and keep them. As a result, Disney streaming has lost lots of money so far. (It did have some films leave the service, such as Home Alone.) Meanwhile, it stays focused on the numbers that drive Netflix’s stock price: subscriber counts.

In defense of HBO Max and Peacock, I’m not sure losing any of these titles besides Harry Potter and Jurassic Park will really hurt the brand. If I were offering them advice, though, it would be to end these old habits of shifting films around constantly. Some library rotation will make sense; windows under a year do not. The key to the traditional streamers competing with Netflix is to offer consistent libraries of classic films. Their value proposition is that their films are better on average than Netflix. Rotating films in and out won’t provide that. 

This does mean, frighteningly, to ignore the money guys. At least for now. Since the economics are all in flux anyways, the cash now doesn’t actually exceed the potential cash later, but that’s a tough case to make.

M&A Update

IMG and Learfield’s merger was cleared last week, consolidating another industry, this time sports viewing rights, mainly college. This will likely be anti-competitive and Sports Business Daily has the details. (Hat tip to Matt Stoller for pointing me to it.)

Meanwhile, the tech giants can’t seem to help themselves. First the Wall Street Journal reports that Google specifically preferences Youtube for video searches. Second, the Wall Street Journal reports that Amazon explores buying start ups, then copies their business models. 

Other Contenders for Most Important Story

Let’s do quick hits on other stories that piqued my interest.

UTA Signs the WGA Code of Conduct

Whoa! Why did I spend so much time on Netflix last week when this story is a way bigger deal?

It doesn’t end everything with the writer’s-firing-their-agents-strike, but this is the first major agency to break ranks. Though the deal definitely will have compromises on the writer’s side. I have to imagine that we’ll see WME and CAA strike deals soon, but I could be wrong.

Amazon’s New Video Game is a Dud

Amazon released a big new “shooter” video game out of private beta testing into public beta testing, then put it back into private. In other words, Amazon’s quest to be the “everything store” isn’t going about as well as their quest to make movies/TV shows: it may take a decade to make a profit, if they ever do. 

AMC Wins Latest Profit Sharing Deal

It looks like the talent for The Walking Dead will lose their suit against AMC Networks over profit sharing. Of course, with these legal opinions you never know how it will actually end or if it ever will.

Entertainment Strategy Guy Updates – The Films Moving Backwards

My take on Disney moving the dates for some of its films for next year–and following Tenet by delaying Mulan–is that the production pause is finally starting to impact the 2021 calendar. Every month that you can’t be shooting is another delay to already tight production/effects calendars.

Really, this issue has been covered widely, but with theaters closed in California, Texas and Florida, it doesn’t make sense to release blockbusters in America. And throws off the entire calculus. 

The solution to break the logjam is for someone to just reopen with the library titles doing well in drive-thrus. Obviously this would have to be done safely, using the best procedures to keep everyone as safe as possible. And not in locations with spiking cases. And this seems to be what AMC is planning to do. Which could finally break the impasse.

The 2019 Star Wars Business Report – Theme Parks

This is part III in a multi-part series estimating how much money Disney made off “Star Wars” in 2019. Go here for my larger series on Disney purchasing Lucasfilm in 2012.)

Introduction and Feature Films

As a tremendous Star Wars fan, I couldn’t shake the feeling that Star Wars had a rough year. “Rough” from a certain point of view. Consider…

– It arguably had the third most popular TV series in America.
– It definitely had the third most popular film in America.
– And it launched a new “land” in two of it’s parks. 

And yet…since this is Star Wars we’re talking about…we’re worried.

IMAGE 3 Bloomberg Headline 3IMAGE 2 - Bloomberg Headline 1IMAGE 1 - WSJ Headline

The theme parks were the biggest disturbance in the force. Based on hyper-charged expectations, observers expected the new park to be utterly jam packed. Instead, Disney saw a decline in total attendance at Disneyland. Stories about Disneyland being “empty”—for July—were blamed on Star Wars. 

On the other hand, Disney raised prices again, finally topping a $200 per day ticket.

It’s all worth unpacking in our continuing series “How Much Money Did Lucasfilm Make in 2019?” (I promise we’ll have this done before the year ends.) This is an extension of the big series I wrote analyzing how much money Star Wars has made for Disney compared to its purchase price. Today it’s all about theme parks, the trickiest business unit to assign value to individual franchises. 

(And also the one most impacted by Coronavirus. Unlike past articles, some of which were written pre-Covid-19, I’ll address that in the final section. As a reminder, this series is about 2019, but it does have some forward looking elements.)

Bottom Line, Up Front

In 2019 Star Wars lost about $60 million in total across the theme parks business. The parks still had big costs in 2019 to finish the lands, which hurt the cash flow.

The story is actually more positive than the headlines suggest, though. Disney was able to drive through incredible ticket price increases (the combined average growth rate is well above 6%, depending on the time period). Given that attendance stayed flat in Disneyland and had the second year over year increase at Hollywood Studios, the new lands are working. (At least, until Covid-19 crushes the top and bottom lines.)

Theme Parks – A Cause for Concern?

The performance of Galaxy’s Edge epitomizes Star Wars’s 2019. The “best of times or worst of times” for Victorian literature, or the “light side and dark side” for Star Wars fans.

As befits everything Disney launches, the buzz was phenomenal back in May when it launched. With headlines like this…

IMAGE 4 - CNN Review

That’s Frank Palotta raving about it in CNN. Other outlets and Twitter matched this hype. These positive reviews—generated from previews given to journalists when the lands were virtually empty—matched the reviews of fans. The folks I know who have visited rave about it. I myself haven’t visited because I was worried the lines were too long. And it’s so damn expensive.

Actually, those two latter points really matter. I wasn’t the only one thinking that way. By July, the word was out that Disneyland wasn’t exactly full. It turns out the price increase was doing its job and keeping folks out of the park. Which led to an article in Bloomberg with this headline:

IMAGE 5 Bloomberg Headline 3

Did Galaxy’s Edge fail then? Not really. If folks were avoiding Disneyland, they weren’t avoiding Galaxy’s Edge, which required reservations to get into for most of the summer and was packed with people. Anecdotally, I think a lot of folks skipped visiting Galaxy’s Edge last year to wait for the crowds to thin out, or for the second ride which debuted in January of this year.

That said, this website is about “business strategy” not a travelogue. From that perspective, two things really matter when evaluating the launch of Galaxy’s Edge. First, Disneyland is thinking very long term with these investments. Like 20 years long time. So if we were evaluating the success of Galaxy’s Edge in July, that’s roughly 1.5% of the time period Disney expect to make it’s money back!

Further, the larger Disney strategy with parks is not to add more people, but to space them out throughout the year while charging them more. That’s summarized by this quote from the Orange County Register.

IMAGE 6 Disneyland Yield Strategy at Parks

The goal isn’t to have a one time bump in revenue, but to establish a brand new reason for families to visit every year. Meanwhile, they are charging those fans more to attend, and selling them more things. When Bob Iger says the Star Wars expansions are exceeding expectations—as he did in the first quarter earnings report in January—normally I’d throw my BS flag. In this case, I think the numbers back him up.

But how do we quantify that?

A Reminder – Theme Parks are Devilishly Tough to Assign Value

The last time I modeled theme park revenue, I complained bitterly about how hard it was. With a film, if you know box office, you can pretty well guess at everything else. 

Theme parks are more like evaluating a streaming video library. How much value do you assign to an individual TV series at retaining customers? If a streamer watches a dozen shows and four movies in a month, that’s a tough question to answer. (And I’ve attempted this before.)

Likewise, how much credit does any single ride get to bringing someone to Disneyland? Don’t many families go every year? Or multiple times? Or on scheduled vacations? It’s not like Star Wars on its own will bring in families.

Yet, if you didn’t add any new rides, the park would get stagnant. Thus, Disneyland needs to constantly add new attractions, and balance those costs against the expected gains. These new attractions then provide fodder for marketing people, new content for fans who go often and generally keep the park up-to-date.

Further, this is a tougher analysis to make for Disneyland than some other theme parks. For example, the Harry Potter lands at Universal Orlando and Hollywood boosted attendance by up to 30% in some cases. That connection is much tighter than Disneyland, which operates at near capacity anyways.

I model those gains in two ways. First, the increase in attendance year-over-year. Second, the increase in ticket prices (which have outpaced the gains in attendance). Once we have those for theme parks at large, the tough part is just assigning value. Which I’ve done, but it’s the biggest “magic number” in this model.

(What’s a magic number? I explained that in this article, but it’s usually the key number that makes a model work but is also the hardest to model.)

The Theme Park Results – An Analysis

To evaluate 2019, then, we just need to look at visitors and price increases. The story with visitors is fine for Disneyland and great for Hollywood Studios. (For those who don’t know, the Star Wars land in Walt Disney World opened in Disney’s Hollywood Studio, the most poorly attended of the Orlando parks.)

IMAGE 7 Theme Park Attendance

For those expecting blockbuster attendance at Disneyland, the results were mostly flat. However, the people were more spread out throughout the year, which helped Disney improve customer opinion. (Indeed, by December Disney had a day where they had to stop selling tickets.)

(By the way, all these numbers come from the Themed Entertainment Association annual report on theme parks. This report just came out on July 20th, so this data is fresh.)

The story is much better for Hollywood Studios. A park that often lacked a purpose, a Toy Story land opened in 2018 and Galaxy’s Edge opened in 2019. Combined, these new lands have boosted attendance from 10.7 million per year in 2017 to 11.5 million in 2019. (And likely would have gone up again in 2020 had Covid-19 not hit.)

As I said above, the real money make isn’t increasing the number of visitors, but increasing the price per ticket. In that lens, 2019 was another great year for Disney. Ticket prices hit new highs. The quick highlights:

– The top ticket price in 2020 at Disneyland was $154, up from $43 in 2000.
– Disneyland was able to introduce a tiered pricing system, allowing Disneyland to spread out customers throughout the year.
– In just the last 10 years, the average growth rate has been 10.3% at Disneyland, and CAGR of 7.5%.

Indeed, the tiered pricing system worked so well, Disney went from three tiers in 2018 to five tiers in February of this year. Meanwhile, the Hollywood Studios prices have started to match the Magic Kingdom prices.

There is one other piece I’ve modeled which is how much guests spend at the parks. Based on reports and some general industry rule of thumbs, I’ve estimated this at $40 per ticket. However, Iger has said that Galaxy’s Edge have driven this up another 10%, so I increased that in my model.

The Theme Parks Model

Let’s take that performance and put it into the model. I updated the 2018 and 2019 numbers with the actual performance for visitors, ticket prices and consumer spending. Here’s the results:

IMAGE 8 - Theme Park Model 2020

My initial estimates for attendance were relatively close. I had guessed that Star Wars could start bumping attendance by 2% at Hollywood Studios, and that’s what happened. (While Disneyland stayed flat, which I did not anticipate.) As a result, my model increased by about $50 million over the course of 2012-2028.

Given the demand for Galaxy’s Edge, I’m still going to allocate value as I had previously, which was starting at 100% of any gains and lowering year over year. These are definitely my magic numbers, and they’re in purple at the top of the model.

The big worry comes from looking at how much Disney still needs to make on the two Star Wars lands. My model only goes to 2028, and even then I don’t think Disney will make its money back on these two parks. Here’s a comparison:

IMAGE 9 Comparison

Of course, we’re not on track for that type of year in 2020, are we?

Coronavirus and Theme Parks

This year is devastating for theme parks. With Disney owning the most valuable theme parks in the world, this is particularly devastating for them.

This doesn’t, though, invalidate the building of Galaxy’s Edge lands. A global pandemic is like a recession: we all knew it was coming, but had no idea when it would happen. When Disney bought Lucasfilm in 2012, it made the right strategic decision to build these two new lands. And again they will pay off for the next two to three decades. 

What’s that? You still want to see a coronavirus-impacted model? Fine.

Screen Shot 2020-07-22 at 10.03.36 AM

Here’s the comparison to the other two models (my model from 2018, from this year without coronavirus, and with coronavirus).

Screen Shot 2020-07-22 at 10.03.44 AM

In other words, a world with coronavirus could cost Disney nearly a $750 million dollars in value. And that’s just the Star Wars allocation. The actual costs are much much higher.

Theme Parks and Resorts: A summary

Money from 2019 (most accurately, operating profit)

It’s a pinch misleading, but likely Star Wars still didn’t make any theme park money this year as it spent big to launch both new parks. It almost broke even, as I allocated most of the price increases in 2019 to Star Wars Galaxy’s Edge. As such, I have Disney losing about $60 million dollars on Star Wars theme parks in 2019.

Long term impacts on the financial model and the 2014 deal

That said, the overall year was positive for the model since the price increases and attendance increases will likely help drive even better profitability in the future. In particular, the spending increase per customer really helps the model long term. 

At least, until coronavirus ruined everything.

I think Covid-19 in the average case will still cost Disney about $750 million dollars when it comes to Star Wars. Mainly this comes from the time it will take to get attendance back to pre-coronavirus levels. Though my margin for error is huge with this forecast.

Brand Value

Longer term, I don’t think Galaxy’s Edge will hurt Star Wars brand at all. If anything it will reinforce the brand position. Despite the lack of crowds, the reviews have been phenomenal for Galaxy’s Edge. That’s the piece I can’t look past. Even as the films disappoint (some) folks, the fans still want to relive and experience Star Wars in the real world. By all accounts the park delivers on that.

Visual of the Week – The Performance of Netflix Top Films Over Time

(This is a new feature from the Entertainment Strategy Guy. It’s a weekly “visual of the week” that will come out every two weeks. If you like it, consider sharing it on social media, just toss me credit.)

The big Netflix news last week was their earnings report. But the most fascinating story for a data wonk like me was Lucas Shaw’s scoop on the top Netflix films by viewership (2 minutes of a film) of all time. With this scoop, I’m up to 30 different “datecdotes” on Netflix film viewership over time.  

This visual of the week has two different presentations. First, Netflix raw viewership overtime, by quarter:

NFLX visual 3

(Details: This is by my estimates for 70% completion of a film by Netflix subscribers. This is global data. Time period is Q4-2018 to Q2-2020.)

Of course, that doesn’t account for the size of Netflix, so here’s the percentage of viewership:

NFLX visual 2

(Details: This is by my estimates for 70% completion of a film by Netflix subscribers divided by subscribers at the time. This is global data. Time period is Q4-2018 to Q2-2020. Constraint: Only films getting over 20 million subscribers are included.)

If you want more details on Netflix feature film performance, I started a big thread on it on Twitter.

Most Important Story of the Week – 17 July 20: Peacock Symbolizes the Battlegrounds of the Streaming Wars

We have a special treat today…an interview with Matt Strauss, head of Peacock’s launch.


I guess I’m the one entertainment outlet that didn’t get that interview. (Seriously, how many interviews did he do over the last month or so?) Like America in World War II, our last entrant joins the streaming wars and that’s our story of the week.

(As a reminder, if you want to connect on social media, try me on Twitter or Linked-In.)

Most Important Story of the Week – Peacock Launches!!!

The last entrant of a major streamer has landed for American distribution. Comcast’s NBC Universal’s streaming platform launched on Wednesday. In full-disclosure, I haven’t used it yet.

(Why? Because I find most “reviews” of UX/UI aren’t objective measures of quality but subjective repetition of preexisting positions. If you thought Peacock would be a bust at launch, you’ll likely hate it. If you’re bullish on traditional entertainment companies–like me–you’ll likely find positive elements.)

From what I hear, the service announced in January is the service we’ve gotten. Strategically, I think Peacock is a pretty smart play by Comcast. First, it’s free, which means it’s competing on price. Second, it’s a FAST on steroids, meaning it’s got a lineup that IMDb TV and Roku Channels (and Tumo/Xumi) can’t match. Third, live sports and news are differentiators. I summarized this is in a thread:

(For my longer-ish take, go back to January after their announcement.)

Instead of their strategy, then, let’s explore how Peacock really is the synthesis of many ideas impacting the streaming wars. (Many of which I’ve written about previously.)

Device/Distribution Wars are the Nu-Carriage Wars

Another streaming service, another holdout by Amazon and Roku against offering the app as a standalone on their devices. Last summer, all the news was about MVPD retransmission battles, such that it made my story of the week in July. But already, I could see the future battleground moving from retransmission to devices. (The Apple/Amazon distribution fight was particularly fierce, if not widely covered.) EMC Capital provided a good summary chart of the landscape:

Screen Shot 2020-07-17 at 9.22.07 AM

(This is one of those simple charts that I’m jealous I didn’t make myself. Click here to subscribe to EMC’s newsletter.)

It seems that the traditional entertainment companies have finally realized how valuable owning the customer relationship (and data) is for direct-to-consumer businesses. The challenge is that the device owners (Roku, Amazon, Apple and maybe Google) are in a better position. Because they control the user experience and potentially billing, they can offer better bundles and experience. More importantly, the key applications (Netflix, Prime Video, and Hulu) take the bulk of customer’s time, so as long as a device has those, it’s likely won’t offend customers by not having the newly launched entrants (not named Disney+).

As I wrote in June, it is in the interests of HBO Max and Peacock to hold out as long as possible. Amazon’s user experience has always been sub-par, and it devalues their content to be mixed in with who knows what content is on Prime Video. (Seriously, Amazon just added profiles to their interface…) Meanwhile, it’s one thing to pay a fee to be on a service; it’s another to let Roku or Amazon own the customer relationship. Or to take the bulk of your ad-inventory.

Can the dual absences of HBO Max and Peacock hurt Roku or Fire TV sales? That’s unclear. Clearly Amazon and Roku looked at Disney+ and saw an app they couldn’t say no to. But that set a precedent HBO Max and Peacock will cling to. 

Part of me thinks this will help Apple TV devices, but only for new customers. I myself may be purchasing a new streaming device this fall; the clear winner for me is Apple TV or X-Box since they have every service I want. (I’m not convinced I need Apple TV+ just yet.)

Comcast Is Powering It’s Flywheel

I kid! Obviously, I think flywheels are an overused concept in streaming video. And tech period. (See my two very, very long articles explaining this here and here.)

One can’t discuss Comcast’s business model without seeing the similarities to Apple or Amazon. Comcast is launching a potential Deficit-Financed Business Unit (DFBUs) in Peacock to increase revenue in another line of business, cable internet. They are bringing folks into their “cable ecosystem” via deficits because they offer Peacock’s $5 plan for free to existing Comcast and Cox subscribers. If you think it’s a good idea for Amazon to sell Prime Video at a loss to drive Prime memberships or Apple to offer Apple TV+ to sell more iPhones (both DFBUs into ecosystems), then you should be fine with Comcast selling streaming at a loss to keep cable subscribers. 

The difference? Apple and Amazon are supported by tech valuations, and Comcast has a lowly cable company valuation. That and my next point.

Comcast Really Does Everything in Digital Media

Now that Comcast has their ad-supported and subscription-supported service, to add to Vudu/Fandango’s TVOD business, and NBC’s broadcast business and Bravo/USA Network/et al’s cable business, and Universal’s movie business, man, Comcast does have it all!

I hold to my thesis from a few months back: Comcast wants to pivot into partially being a tech company. Hence the push to have a holistic digital offering very similar to Apple or Amazon. This will hopefully supplement and/or replace their declining cable and satellite businesses.

Of course, you can see the clash with the “flywheel” thought above. Whereas Apple and Amazon can afford to lose lots of money–though affording to does not mean they should–Comcast doesn’t have that luxury. Further, for anyone not in Comcast’s cable footprint, there is no ecosystem to bring customers into. Like Disney and AT&T, Comcast needs to make money in streaming.

One Thing to Watch: The Churn Hypothesis

A big theory of Netflix bears–those pessimistic on its stock price–is NOT that Netflix will die. There is no way that suddenly 63 million US subscribers abandon the service. That’s not the argument.

Instead, the argument is that with digital subscriptions the name of the game is “churn”. The number of folks leaving a service versus the number joining. 

Historically, Netflix has had astoundingly low churn. Some have estimated it at 3% per month, though I’ve speculated it’s higher. Since Disney+ launched, we’ve seen evidence that churn is up. And while the data is super noisy–and part of the “asterisk extraordinaire” coronavirus times–that churn has picked up during Covid-19.

This has matched a thesis I’ve supported, but discovered through conversations with Hedgeye’s Andrew Freedman and Twitterzen MasaSonCapital. The thesis isn’t that anyone will “kill” Netflix. Instead, the launch of new streamers powered by the three best studios for content (Disney, then Warner Bros, then NBC-Universal) will make life more expensive for Netflix. That will show up in churn. 

Between HBO Max and Peacock, I think there are bundles that are increasingly viable that don’t have Netflix in them. Obviously, this isn’t for everyone! Some folks will always have Netflix. But other folks will start to use Netflix in chunks watching for a period, disconnecting and coming back.

Either way, this is what I’m watching as Peacock launches and all the streamers begin to compete.

Entertainment Strategy Guy Update – Apple’s Services Business Model Weaknesses

Over the last month or so, Apple’s seen a string of bad news stories that add up to a trend. That trend being that they aren’t very good at launching entertainment subscription services.

Read More

An Aggressively Moderate Take on Coronavirus and Sports

On Wednesday sports in America made their triumphant return! “The MLS Is Back” tournament declared that, well, the MLS is back.

This follows the June return for most of European soccer, starting with the Bundesliga and continuing to the English Premier League, the most popular global sports league.

Yet not all is sunshine and roses. The leagues are back…but the fans aren’t. And won’t be for the rest of the summer, if not longer.

So how should we think about Coronavirus and Sports? Well let’s bust out the EntStrategyGuy’s patented Covid-19 impact system to analyze it. We look at impacts on Supply, Demand and Employment (if relevant). We also try to separate what we know from what we don’t (and is usually guessed at).

(Curious for my “moderate” take on how Covid-19 will impact the rest of the entertainment industry? Here are my takes on…

The Entertainment Recession
Pay/Linear TV
TV and Film Production


If you’d asked me in 2012 how sports teams made their money, I’d have told you extremely confidently that they made their money by signing huge TV sports rights deals. That’s what I kept reading in the news, after all. Then one day a famous NBA GM spoke at my school and disabused me of that notion in a way that’s stuck ever since. And understanding that explains the trouble for sports leagues over the next year or so.

Yes, the headline buzzy numbers about multi-year deals for TV rights are indeed true. Sports rights for TV have grown by about 4-5% per year for the last two decades. (Math here.) That’s tremendous growth! And hence why everything related to sports has also grown in value. (The price of teams, the salary of players, the size of sponsorship deals.)

But it isn’t the entire story. The second or first biggest chunk of revenue for nearly every sports team in America (and I believe globally) is ticket sales. That’s fans attending live games. It depends on market size, but not the way you think. Larger market teams like the Lakers, Dodgers, Golden State Warriors, Dallas Cowboys and Knicks have even more of their revenue as a percentage from local ticket sales than smaller market teams. This is because seats to sporting events are a constrained inventory for a popular product often in very economically wealthy areas. That’s a recipe for high prices.

This explains why the sports leagues, initially, were more willing to postpone the season than play games in front of empty arenas. Empty arenas meant permanently lost revenue and the NBA, NHL and MLB desperately wanted to avoid that happening. (This article says all live revenue is about 40% of the NBA’s total revenue.) They waited as long as they could, but now it’s clear sports in front of fans aren’t happening this year. 

And since it’s better to get some revenue than no revenue, the sports leagues–sans the NFL–have figured out how to bring competitions back without fans. (Good for them!) This means sports in America will be back on live TV soon enough. (Technically the PGA is already back in the US and as I said above the EPL and other European leagues are already back.) 

Still, this leaves the situation with ticket sales unresolved. The owners and commissioners desperately want that other huge chunk of revenue back.

Forecasting when fans can return to arenas or stadiums is fairly difficult. It’s worth comparing them to theaters because the different situations imply different economics. With theaters, I remain convinced that there are measures that can reduce transmission dramatically: have everyone wear masks, keep a checkerboard pattern in design, have a reduced congestion plan when leaving. (This is definitely a minority take not shared by public health officials, so take it for what it’s worth.) Moreover, with a new film, a theater can flex it onto many, many screens simultaneously, meaning you can support a checkerboard pattern while potentially achieving mostly the same volume of tickets sold.

This is not the case with sports. If you’re an NFL team, you only get 8 home games. NBA team gets 42. MLB gets 424 (it feels like). And so on. You can’t surge it into more stadiums or games. (The very thing that drives up prices in the absence of coronavirus hurts the sports leagues here.) Moreover, unlike theaters, stadiums are filled with choke points where people will crowd. (You’d have to have folks arrive 2 hours early or more to avoid crowding at ticket entrances.) Not to mention, a checkerboard seating pattern won’t make sense because you’d have to rearrange nearly every season ticket holder. Yikes.

This means that to have sports return with live fans, you are much closer to needing a full therapeutic cure or vaccine before sports can safely resume.

When will that happen? Well I don’t know. And it’s the biggest variable–and potential hit to the bottom line–for sports teams. However, if you assume we will one day cure or eradicate coronavirus, the supply problem will eliminate too. In the meantime, I expect players, owners, stadiums and all adjacent dependents to take a hit to their salaries and values.

As for the “Bubble” situation, I’m reasonably confident the leagues will find ways to play the games in largely safe ways for the players. It will evolve and folks will get sick, but the revenue draw is too high to avoid.


Here’s the good news: all signs point to sports fans clamoring for the return of their favorite sports. The Michael Jordan documentary did blockbuster ratings for ESPN. Same for the NFL draft. Even golf is breaking ratings records!

Everyone is trying new things during this quarantine. Some habits may change. But abandoning sports doesn’t look to be one of those things.

Of course, the flip-side to the above supply scenario is that maybe fans will abandon live sports for fear of the coronavirus. This is a risk, but feels low probability. First, sports will likely be constrained by having a therapeutic or vaccine before they return. Unlike theaters, which will test audience demand for their product, I don’t see live sports in arenas this year. 

Second, I don’t think coronavirus has turned us into a world of shut-ins. If anything, folks want to flee their homes more than ever. Admittedly, this is my opinion. It’s an unknown and I could be wrong. A pessimists could say it’s as likely fans flock back to stadiums as they abandon them in perpetuity. Where specifically it lands on that spectrum is up in the air.

As fro demand for live-sports on TV, again I expect it to be high. If folks are in perpetual shut downs with concerts, live-sports and many outdoor gatherings prohibited, live sports rights should be widely consumed. Not to mention, the slow down in TV and film production has meant fall will be light on new content. Sports can instantly step into that void.


I do see lingering pain the labor market related to stadiums staying closed. Entire ecosystems are built around attending live sporting events. Everyone associated with working that from ushers to security to restaurant staff will be hurting until sports return.

Even the players, as I mentioned above, will likely see a lot of pain. As long as salaries are a percentage of basketball related income, then the players will see cuts if fans can’t comeback in 2021. 

Overall, I’m less worried about the impact on the economy from sports compared to either TV/film production or movie theaters, both of which employ a lot more people.

Bonus: The Breaking of the Bundle?

The one variable that is neither “supply” nor “demand” is whether the absence of live sports will cause a further deterioration of the cable bundle (and maybe satellite bundle in Europe) that props up the current exorbitant sports rights fees. I’ve seen this thesis floated out there fairly commonly over the last few months. (If not directly, then via the rhetorical question headline.)

If prices to be paid are any indication, the answer is no. The prices for live sports rights haven’t decreased even during coronavirus–they’ve continued to go up actually–meaning sports will definitely be the anchor propping up cable and satellite providers in the near term. I’d recommend considering this mostly wild speculation. Folks have been predicting the end of TV since the beginning of this decade. And it’s still kicking.

However, the true test will be the upcoming earnings season. After all, the bundle won’t die because companies let it, but because customers finally opt out. That will be the true final test.

Most Important Story of the Week – 10 July 20: Sports Streaming Price Hikes

I hope everyone–and this probably just applies to the Americans–enjoyed the long weekend. The only thing missing really was America’s pastime of baseball. Or any sports really.

But all that has changed. Sports are back! Which is really the story of the week. But I’ll tackle that next week in the next installment of “Coronavirus and Entertainment”. In the meantime, let’s look at another sports-adjacent story.

Most Important Story of the Week – Sports Streaming Price Hikes

Everyone is raising prices, from Youtube TV to ESPN+ to Fubo TV

While all these services are sports based, it’s also important to note the differences between them. Youtube TV is a vMVPD, meaning they’re trying to replicate the cable bundle via streaming. ESPN+ is a streaming service that only offers sports. Fubo TV is a hybrid: it’s a vMVPD, but focused on sports.

The least shocking price raise should be Youtube TV. Of all the services, it was the most clearly trying to offer a $65 product for $45. Despite the bells and whistles, the vMVPD model is essentially the traditional cable model: the vMVPDs pay each channel a given rate per subscriber who receives it. The only difference is that instead of a cable box it goes through a streaming TV, device or iPad. So if you see the rates for various channels–for example this chart in this article by Dan Rayburn–you see how expensive it is to own all those channels. (Especially ESPN.)

Add all them up, and you quickly see that the reason cable is so expensive is because cable channels are expensive. Hence, virtual cable is expensive because virtual channels are expensive. The core economics aren’t different.

How did Youtube TV last this long without a price increase? Because they were losing money on it! 

Frankly, that’s why any articles or tweets I saw praising Youtube TV always baffled me. Of course they were beating everyone on price! Google subsidized the losses! But they hadn’t actually created any value, they were simply capturing market share. (They had created some value with a good UX, but that value is easily superseded by selling at a loss.) 

Losses in cable can add up really quickly, and even Google couldn’t stomach the Youtube TV losses. If they were losing $15 per customer per month, at 2 million customers, that’s $360 million a year. Adding customers would just make the situation worse. You can’t make up these losses on volume. Hence the price increase.

The challenge is what happens next. Since there are no natural digital monopolies, I wouldn’t be shocked to see either the FASTs or new vMVPDs rise up to offer “skinny bundles” again. Clearly customers want lots and lots of channels–hence why MVPDs and vMVPDs exist–but don’t want to pay as much as the local monopolies charge. Since the barriers to entry are relatively low, a new skinny bundle can easily enter. The actual solution is to have the cable channels finally start lowering their affiliate fees, but that’s a tough pill for a business unit to swallow.

On to ESPN+. If you look at Disney’s earnings report, you know that Disney is losing money on streaming. How much they are losing on ESPN+ in particular is unknown. ESPN+ doesn’t really have a lot of in-demand live sports, so it’s not like they can increase prices too much before folks will unsubscribe. This could portend some additional sports deals, or just Disney shoring up the bottom line in a world without theme parks and movie theaters. Either way, I expect both to keep happening: Disney will try to get better rights for ESPN+ (think NBA or NFL) while raising prices..

Other Contenders for Most Important Story

WGA Puts Their Strike on Hold?

This happened over a week ago and I missed it, so shame on me. (Thanks to KCRW’s The Business podcast for shouting it out.) The caveat is nothing has been officially announced as of yet. So the deal could still fall apart. From reports, the deal is inline with the gains of the most recent DGA deal.

The headline is that the deal prevents a strike because the WGA can’t add a third tsunami to the twin waves of firing all their agents and coronavirus. Really, this is a victory for the pandemic. 

The other victor–as Kim Masters noted–is for the studios and streamers, and I tend to agree. The current deal hurts younger and lower level writers that are caught between exclusively writing on one show at a time, but also the reduced episode commitments of the streamers. Not changing that really hurts writers. But they didn’t have a choice.

Disney World on Track to Reopen this weekend

Theme parks are on track to reopen in Florida, with all eyes on Disney World. (As of this writing.) Depending on how cases, hospitalizations and deaths trend over the next few weeks, this will be a story to monitor. On the one hand, people could end up being too scared to go. On the other, theme parks may not end up being a huge source of transmission if they’re at reduced capacity with lots of effective countermeasures.

I remain bullish for theme parks. Unlike sports stadiums, they have more control over keeping folks outdoors and hence controlling transmission. The analogy is the return to restaurants and bars in June. As soon as lock down was lifted, folks returned to their old behaviors relatively rapidly, with just facemasks and spacing as the key differences. Of course, it wasn’t the same volume as previously, but enough to make the business models work.

If theme parks prove safe, I could see the same thing happening: folks come back as before. That said, America’s outbreaks are surging across the southern states whose temperatures have increased in recent weeks. It’s one thing to open a theme park when cases are plummeting; another when they’re surging. That will have to tamp down some demand.

The Landing Spot of Mad Men is…Everywhere?

Read More

Should You Release Your Movie Straight to Netflix? Part II: The Streaming (nee Netflix) Counter-Arguments

Last December, I started a series whose goal was to valiantly defend the theatrical distribution model. This doesn’t come (only) from some soft spot in my heart for theaters, but from the economics of making movies. Studios can earn a lot more money by releasing their films theatrically. I’ve taken to calling this the “Booksmart Conundrum”.

Nevertheless, the question I asked last winter—“Should you release your film straight-to-streaming (Netflix) or to theaters?—is as relevant now as ever. Indeed, it’s almost quaint to imagine an article from last December is still relevant, given all that’s happened:

– Coronavirus came and closed theaters.
– Comcast (via Universal) released Trolls: World Tour straight-to-video.
– Disney put Artemis Fowl straight to Disney+, and later Hamilton.
– Netflix bought the rights to countless films and put them straight on its service too.

Does all that news invalidate my article series? Far from it. Here’s the plan. I’m going to continue my Q&A as I had it planned last December. Then, I’ll dedicate an entire article to the post-Coronavirus landscape and it’s implications. 

So let’s do it.

Question: Seriously, you’re going to pretend “Covid-19/Coronavirus” never happened?

Not at all. Obviously the immediate impacts are real and I’m monitoring them in my weekly column. (Example of my latest back in June, here.)

But the core economics of releasing films in one streaming window versus multiple windows starting with theaters hasn’t really changed. They may have been tweaked given some of the new behaviors—but you know I’m skeptical on that—but Coronavirus is the “Asterisk Extraordinaire” of our time. The more confident someone is in predicting the future impact of Covid-19, the more likely they are to be wrong.

What matters for studios in the immediate term is when traditional theatrical releases restart. I still maintain that will happen before the end of the year, and likely in August. And when that happens 90% of the model will be intact. So that’s what we’ll discuss in this series.

Question: Fine, can you remind me where we were?

Sure, because I had to do it myself. To start, I finally built a straight-to-streaming financial model for films. This means that via Netflix Datecdote I can estimate how much money an individual film made for Netflix. How cool!

You can read how I built the model, why it works, and the results for The Irishman here. I built this model at the behest of the venerable Richard Rushfield for his Ankler newsletter, and showed how I can use this model very recently when I calculated the results for Extraction on Netflix too. I would add, Nina Metz at the Chicago Tribune did a great write up on my methodology too.

The most useful part of a model, though, isn’t the results but what the model tells you about how the world works. That’s the point of this series: take the model and use it to draw insights about streaming versus theatrical business models. In Part I, we focused on how much money a film makes in the various “windows” it transitions through. No matter how you cut it, theatrical distribution is a huge part of that window. Over 30% easily, but that’s actually rising as home video declines. (Also don’t neglect how home entertainment, TVOD, EST, and premium cable can add to the bottom line too.)

Another key insight is how much better the margins are better for theatrical viewing than they are for viewing at home. As a result, if you don’t release in theaters, you’re giving away potential revenue. Did I calculate this specifically for Netflix? I did, and found out, under a pretty reasonable scenario, they could have easily left $750 million dollars on the table in 2019.

Question: Three quarters of a billion dollars? Why would Netflix do that? If you were making the strongest pro-straight to streaming argument, what would it be?

The folks at Netflix aren’t crazy. They can build these models too. And the folks at Amazon tried to release their films in theaters. The most generous explanation I can give would go like this:

When a film goes to theaters first, it risks being viewed as unpopular if it flops. That would destroy the value on the streaming platform. Moreover, by going straight-to-streaming, Netflix and others have the added value of exclusivity on the platform, driving new subscribers. This is really the point of putting films on streaming anyways, to acquire and retain subscribers.

That’s really two explanations in one. First, failure at the box office destroys value and second that exclusivity raises value.

Q: Is this a strawman, or do you have someone making this argument explicitly?

This is the argument Scott Stuber—Netflix head of film— made to Variety at their conference. His quote:

IMAGE 1 - Stuber to Variety QuoteEssentially, he’s more afraid that film will bomb at the box office than it won’t perform on his service.

Well, I have a two word answer for him:

Late Night.

Q: What does Late Night have to do with it?

Read More

Long Reads for the Long Weekend – 2 July 2020

This isn’t my usual column, is it? I’ll be honest, I plan to take the July Fourth Weekend off, and I wrote this gem ahead of time. (Just like I did last year.)

Instead of commenting on the week’s news, I made a list of the best articles I read over the last year or so. (My calendar year starts in July. It makes more sense.) This is similar to what I try to do in my bi-weekly newsletter (Sign up here!) by offering a “best of the best” reading list. 

Unlike the newsletter, this is a bit more discursive and esoteric. It’s not the stories that matter the most for entertainment, but the stories that stuck with me the most when I reflected on the last year. Some of them may not have even made the newsletter. As a bonus, this year I’ll also provide a quick list of my best articles to provide you with even more thousands of words to enjoy.

  1. “Was Email a Mistake?” and “Can Remote Work Be Fixed?” by Cal Newport in the New Yorker. 

Newport will be the only author featured twice in this list. But he’s easily been the most influential writer I’ve read over the last five years. I would confidently say that if any of my readers read his books Deep Work and Digital Minimalism they’ll be better performers at work. Easily. These two New Yorker articles take his voluminous research into productivity and apply them to our current era, both before and after Covid-19. 

  1. “Red Dead Redemption 2: one year after the hype” by Film Crit Hulk at Polygon

It’s hard to describe what this article is really about. It isn’t just a video game review, though that’s part of it. It isn’t just an exploration into video game mechanics, though that’s part of it too. It isn’t just an exploration of storytelling, though it has that too. What I can tell you is it is as well written as it is long. And I plan to reread it, it’s that good.

  1. “The TV Subscriptions You’ll Need to Watch Your Favorite Shows” by Mike Raab at Medium

This is the best use of data I’ve come across in the last year and I’ve cited it repeatedly in my columns and writing. The best thing is most of the data is publicly available, but Raab was one of the few folks to actually do the analysis. This still sets the baseline, in my opinion, for how Disney+, Peacock and HBO Max can compete with Netflix and Amazon in the streaming wars.

  1. “How (And Why) I Cut the Cord: A TV Critic’s Journey Over the Top” by Tim Goodman in THR

Scrolling through my list of potential articles, as soon as I reminded myself of this headline, I knew that it this article had to make the cut. Former TV critic Goodman explains the hows and whys of cord cutting through multiple parts. From a business perspective, he’s basically laying out how cutting the cord creates value for many customers. Plus, it’s a very clear guide, probably the best of its ilk. 

  1. “Social Media Strategies for Comedians that Actually Work” by Josh Spector

This is an article that is simply the best “how to” advice I used in the last year or so. (It was published in May of 2019, but I used it all of 2020.) While ostensibly about comedians, any entrepreneur or publisher can use the advice in this piece. In particular, I love the advice to use fewer social media platforms, to think like a “magazine” and to actually pay to advertise your creations. That last point in particular resonates: I haven’t been using paid promotion for this website, and frankly it was a business mistake. This has tons to learn for everyone.

  1. “Streaming Services and the Theory of Perceived Value” at All Your Screens

Rick Ellis does a great job separating price from value in this “Saturday Speculation” column. He focuses the debate on streaming services to the “perceived value” they create and pulls some implications from that. Along the way he mentions nearly every streamer and how their perceived value, explaining why some are priced super low and some high.

  1. “It’s the Austerity, Stupid: How We Were Sold an Economy-Killing Lie” by Kevin Drum at Mother-Jones

Since it’s my list, I’ll break the rules. This story isn’t even from last year, but 2013. So why is it still relevant? Because the core lesson of the Great Recession still isn’t being learned! In times of recession, we need government spending more than ever, and we’re still debating whether or not we give it in response to the greatest economic disaster since the Great Depression. This decision by Congress will have the biggest impact on the economy for the next ten years. Let’s hope they make the right one.

  1. “Whatever Happened To ‘Mr. Robot’?” By Alex Zalben at Decider

I too wondered this question, even as I was–seemingly alone with my wife–watching season 4. Zalben tells a story about Mr. Robot that happens to explain the history of streaming over the last four years as well. It also has lessons about network branding, global streaming services and frankly how the quality of a TV show dipping can permanently alienate its audience. 

Honorable Mentions

I enjoyed a few other articles or wanted to shout out my favorite writers. Here’s a quick list:

“How AT&T Took HBO to the Max” by MasaSonCapital

“What Economists Have Gotten Wrong for Decades” by Jared Bernstein

“Meet Bob Chapek, Disney’s New CEO and the Tim Cook to Iger’s Steve Jobs” by Julia Alexander

“20 Charts for 2020” by Evolution Media Capital

“Keyboards of the World: How China Made the Piano its Own” in the Economist (and the entire double issue)

The Best of the Entertainment Strategy Guy

If you still need something to read, here are my four most popular articles (probably) from the last year or so:

“Netflix is a Broadcast Channel”

How HBO Made Billions on Game of Thrones” (Director’s Commentary here)

“Aggreggedon: The Key Terrain of the Streaming Wars is Bundling”

“Netflix is Five Guys and Hulu is McDonalds: How Hamburgers Can Help Explain the Streaming Wars” 

Enjoy the long weekend!