In 1996, Disney merged with Capital Cities/ABC and created the Disney|ABC Media Network division. It is comprised of 8 owned and operated stations, over 240 national affiliates, 20 cable channels, and equity shares with digital over the top platforms (1).
ABC’s Primetime Fall season has been doing relatively well with high ratings(5). They have primetime programming Sunday to Friday nights and on Saturday, they air football.
While new shows Quantico, Dr. Ken, and The Muppets are doing quite well and are expected to be renewed for another season (6), Blood & Oil is not doing as well and very close to being canceled and Wicked City’s ratings plummeted quickly at a record low of 1.7 million viewers in their third week, and after their third episode, it was the first show of the season to be canceled.(12).
ABC’s total revenue for the 2015 fiscal year was $6.683 billion coming from renewal of affiliate deals and advertising sales. ABC’s primetime are top spots for ad sales due to their high ratings, especially on Thursdays 8:00-10:00 pm (10). Monday through Wednesday 10:00 pm spots are not as popular, but they still sell enough ad spots (3). ABC is earning more advertising revenue during the holiday season with specials and family favorites(14).
Cable
Disney’s Media Network owns and operates 7 cable networks and has shares in 13. Owning 100% of both Disney Channels and ABC Family, 80% share in ESPN, and 50% in A&E, Disney|ABC runs 20 networks with 1,832 million subscribers total. In the 2015 fiscal year end, Disney|ABC’s cable networks had $16.581 billion in revenues from subscribers and ad sales (1).
Disney Channels include The Disney Channel, Disney Junior, programming for infants and toddlers, DisneyXD, Hungama, in India, and Radio Disney. have kid-friendly programming 24/7 with holiday programming in the month of December with holiday episodes, specials, and family movies (15).
While ESPN provides Disney with 50% of their profit, over the past two years, ESPN has lost 7 million subscribers, which will effect the company (17). As such, ESPN has spent more money on operating and program expenses with hopes to bring in more subscribers and make the experience better for their current customers (18).
Disney|ABC will continue to work on gaining more cable subscribers through advertisements and programming (18). ABC is promoting their new shows for the winter season premiering in January including The Bachelor,The Catch, The Family, and Of Kings and Profits. Disney Channel recently became available in Canada and will continue to spread into other countries (20). In addition, they are working on future projects for ABC, including a Marvel comedy, Damage Control. Disney predicts their Media Network revenue to grow from their creative original content. (1)
Hopefully ABC will produce a successful show for the 10:00 pm spot and their cable networks gain more subscribers.
Sources
(1) Disney Annual Report. Retrieved December 2, 2015.https://www.thewaltdisneycompany.com/sites/default/files/reports/fy15-form-10k.pdf
(3) Media Networks. Retrieved December 2, 2015 www.thewaltdisneycompany.com/disney-companies/media-networks
(4) Walt Disney Co. Retrieved December 2, 2015. https://www.marketwatch.com/investing/stock/dis/charts?symb=DIS&countrycode=US&time=6&startdate=1%2F4%2F1999&enddate=12%2F1%2F2015&freq=1&compidx=none&compind=none&comptemptext=Enter+Symbol%28s%29&comp=none&uf=7168&ma=1&maval=50&lf=1&lf2=4&lf3=0&type=2&size=2&style=1013
(7) No TV Shows Canceled? Retrieved December 2, 2015. ttp://www.latimes.com/entertainment/tv/la-et-no-canceled-tv-shows-20151105-story.html
(8) Company Overview. Retreived December 2, 2015. http://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapId=13728276
(9) Wicked City Cancellation. Retrieved December 2, 2015. http://www.ibtimes.com/abcs-cursed-tuesday-night-time-slot-wicked-city-cancellation-continues-three-year-2188192
(13) ABC Renewals. Retrieved December 2, 2015. http://tvbythenumbers.zap2it.com/2015/11/17/abc-renewcancel-standings-week-8-wicked-city-and-the-10-oclock-problem/
(14) Weekly Ratings. Retrieved December 2, 2015. http://tvbythenumbers.zap2it.com/2015/12/01/tv-ratings-monday-nov-30-2015/
(15) What’s On Disney Channel? Retrieved December 2, 2015. http://affiliate.zap2it.com/tvlistings/ZCSGrid.do?fromTimeInMillis=1449475200000&stnNum=12510&channel=&sgt=grid&aid=disn
(16) ESPN. Retrieved December 2, 2015. http://espn.go.com/
(17) ESPN Subscribers Fall. Retrieved December 2, 2015. http://www.cnbc.com/2015/11/27/disneys-espn-subscribers-fall.html
(18) Disney Feels Pain of Lost Subscribers. Retrieved December 2 2015. http://www.bloomberg.com/news/videos/2015-11-30/disney-feels-pain-of-seven-million-lost-espn-subscribers?cmpid=yhoo.headline
(19) Disney Posts Strong Ad Revenue. Retrieved December 2, 2015. http://www.mediapost.com/publications/article/262014/disney-posts-strong-ad-revenues-for-espn-abc.html
(20) Disney Channel in Canada. Retrieved December 2, 2015. http://www.theglobeandmail.com/report-on-business/corus-gains-canadian-rights-to-disney-channel-content/article23983642/
Discovery Communications, Inc (DCI) is an international mass media entertainment company. Based in Maryland, U.S., it manages 150 television networks and 33 worldwide channels (both satellite and cable) [2]. DCI operates in 220 countries, broadcasting in 45 different languages and reaching three billion viewers a week [3]. DCI both produces its оriginаl content, which is primarily non-fiction, and аcquires some programming from producers worldwide [4]. The company also produces and distributes educational products and school services, such as digital textbooks [5].
Discovery GO’s logo. The new streaming app introduced on December 2nd, 2015 [13].
DCI was initially established by John Hendricks in 1985 as a single Discovery Channel [6]. During the 1990’s the company developed additional networks, including Discovery Kids, Animal Planet and Discovery Travel [7]. In 1995, Discovery Communications launched its first website Discovery Channel [8]. Today, the company’s online streaming is estimated to get 400 million hits monthly [9]. Most of the shows are also available on Netflix, iTunes, YouTube, and Revisob3.com. [10][11]. On December 2nd 2015, DCI became part of TV Everywhere business model, by launching its new streaming app –Discovery GO. The app, mostly available to the pay TV subscribers only, allows viewers to access the content of DCI’s networks from any device [12].
Key Executives:
[14] David Zaslav – President and CEO of Discovery Communications
[15] Jean-Briac (JB) Perrette – President Discovery Network International
[16] Andrew Warren – Chief Financial Officer and Senior Vice President
International Expansion in Fall 2015:
DCI exemplifies the successful international company with over 300 million international subscribers [17]. With new head of Discovery Networks International Programming and Operations, Darcy Tomlin (appointed in October), this season has been especially contributive to DCI’s overseas growth [18].
DCI’s executives hosting the show gathered for the finale [59].
This fall DCI organized many promotional events abroad [19]. For example, DCI’s networks CEEMEA (Central & Eastern Europe, Middle East) hosted an exclusive event in Johannesburg on November 18th [20]. The company presented its major projects coming up in 2016 to it’s 200+ event attendees [21]. Among the introduced projects were Discovery Chanel’s “Sherpa,” Animal Planet’s “The Lion Queen” and TLC’s “Belief.” The event, hosted by DCI’s executives, was marked by the performances of Discovery stars, such as Andi Rive (“The Lion Queen”), Whitney Thore (“My Big Fat Fabulous Life”) and magician Troy (“Troy”) [22].
DCI has been strengthening its presence not only in African, but also in European markets. This fall was the first season of DCI’s full ownership of Eurosport International – one of the largest European sport-entertainment networks, which was recently acquired by DCI from TF1[23]. The purchase is especially important as Eurosport won the multi-platform rights for broadcasting the Olympic Games from 2018 to 2024 [24].
In September, DIC also signed a partnership agreement with Russian Media Group, forming Media Alliance and securing Discovery’s presence in the local market [25]. (So far there are 11 DCI channels available in the country [26].) Media Alliance will launch a development of a new regional free-to-air channel and distribute the Discovery andEurosport pay TV portfolio. In the Russian market, Discovery Channel, TLC, and Animal Planet are the lеаders in nonfiction content, while Eurosport is the primary pay TV spоrt-related chаnnel [27].
International expansion allows DCI to maintain growth despite a recent decline in the US market [28]. Last year, international markets brought the company 55% of its overall revenues, while this number is projected to reach 65% by 2018 [29]. Therefore, more international deals and promotional events are expected in the future.
Fall 2015 Releases:
“Exorcism: Live!”
On October 30th, DCI’s Destination America featured its Halloween-special “Exorcism: Live!”– a two-hour broadcast during which a team of so-called “paranormal professionals” tried to purify a supposedly “possessed” house in St. Louis [31]. The show is closely related to “The Exorcist” book by William Peter Blatty: “Exorcism: Live!” took place in the house where the exorcism was performed, in 1949, which inspired “The Exorcist” novel [32]. According to producer Jodi Tovay, the main event wasn’t about saving a possessed person, but rather about an attempt to cleanse evil from the house itself in a ritual Tovay referred as “a hybrid of an exorcism and a blessing” [33]. Audiences had a chance to actively participate in the event by following several live cameras put around the house online. Producers encouraged viewers to assist the exorcism team and report mysterious activity through Twitter, using the #exorcismlife hashtag [34]. Selected tweets appeared live on air [35]. As a result, “Exorcism: Live!” became the #1 non-football live event on cable in October [36]. For the target audience P25-54, the show gained a 0.59 for L+3 ratings compared to its competitors’ A&E’s 0.34 and National Geographic’s 0.19. The show was also the #1 most mentioned event on Twitter on October 30th, generating 29 thousand tweets [37].
On November 11th, Discovery Family Channel featured a premier of its strongly anticipated “Lost & Found.”[39] In this reality show, produced by Leftfield Pictures, a team of “professional finders” helps people to find someone they have wanted to thank for a long time (for instance, middle school teachers, old friends, and lost relatives) [40]. “Lost & Found” is a fragment of Discovery Family Channel’s “Project Thank You,” which is a multiplatform campaign to bring people together to say thanks [41]. Throughout all of November, the channel is featuring gratitude-centered programming, vignettes and online campaigns [42].
Financials:
DCI is a рublic соmpаny, trading in NASDAQ stock market [43]. Its most recent stock price (as of November 27th) of $31.08 per share reflects the company’s positive tendency over the last three months [44]. During the third quarter this year, DCI’s revenues decreased 1% (from $1,573 million in the Q3 of 2014 to $1,557 million in Q3 of 2015) [45]. The decrease, however, is caused by currency effects, without which the company would gain 8% more revenue in comparison with last year [46]. The biggest sources of revenue were domestic advertising and distribution [47]. The revenues coming from both of these sources have increased by 5% in advertising (from $388 million in 2014 to $410 in 2015) and by 11% in distribution (from $318 million in 2014 to $357 million in 2015 )[48]. This September, Discovery hosted its first ever Investor Day in NYC, which attracted 300 attendees, including investors, financial analysts and industry journalists [49]. During the event, DCI’s CEO David Zaslav announced the plans for long-term international and domestic development and revealed that DCI wоuld rеаch thrее billiоn subsсribеrs by the end of 2015 [50].
Positive tendency of Discovery Communication’s NASDAQ stock price [58]
Projections for Discovery Communications
The quote of the director of Racing Extinction Louie Psihoyos [50].
There are several trends in DCI’s future: international expansion, high involvement with the Olympic Games through Eurosport, increase of subscribers and most importantly a transition from entertainment to more documentary-oriented content [51]. Over the past years, there has been a lot of criticism of Discovery’s pseudo-scientific shows, such as “Shark Week”[52]. However, it’s soon to be changed. John Hoffman, appointed this year as a head of Discovery Channel, has promised to bring more factual and scientifically accurate programming [53]. In fact, the impact of this transition is already in the air. This fall season has already increased the expanding list of DCI’s documentaries by the newly-released shows such as “Marooned,” “Nuremberg: Nazi Judgment Day” and “Melting: Last Race to the Pole”[54]. Furthermore, on December 2nd, Discovery is releasing its highly anticipated “Racing Extinction”[55] This documentary, directed by Academy Award winner Louie Psihoyos, portrays an ecosphere of endangered species and the activists’ efforts to save them [56].Therefore, there is firm evidence that DCI will remain a major educational entertainment network appealing to large ranges of audiences all over the world.
[2] Discovery Communications, Inc. – Company Profile, Information, Business Description, History, Background Information on Discovery Communications. Retrieved 28 November, 2015. http://www.referenceforbusiness.com/history2/74/Discovery-Communications-Inc.html
[3]Discovery Networks International. Retrieved 28, November 2015. https://www.linkedin.com/company/discovery-communications-international-division
[4] Discovery Communications, Inc. – Company Profile, Information, Business Description, History, Background Information on Discovery Communications, Inc. Retrieved 28, November 2015. http://www.referenceforbusiness.com/history2/74/Discovery-Communications-Inc.html
[6]John Hendricks: How He Built The Discovery Channel From Scratch. Retrieved 28 November, 2015. http://www.forbes.com/sites/danschawbel/2013/12/29/john-hendricks-how-he-built-the-discovery-channel-from-scratch/
[7]Discovery Through Decades. Retrieved 28 November, 2015. http://30yearsofdiscovery.com
[8] Discovery Communications, Inc. – Company Profile, Information, Business Description, History, Background Information on Discovery Communications, Inc. Retrieved 28 November, 2015. http://www.referenceforbusiness.com/history2/74/Discovery-Communications-Inc.html
[10]Discovery Digital networks. Retrieved 28 November, 2015. http://discoverydn.com/about
[11]Search Results for Discovery Channel. Retrieved 28 November, 2015. http://dvd.netflix.com/Search?v1=discovery%20channel
[12]Discovery Communications Launches new TV Everywhere Platform. Retrieved 28 November, 2015. http://www.cynopsis.com/story/discovery-communications-launches-new-tv-everywhere-platform/
[13]Discovery Introduces App For TV Everywhere Streaming: Discovery Go.Retrieved 27 November 2015. http://deadline.com/2015/12/discovery-go-tv-everywhere-streaming-app-1201648066/
[14] Davis Zaslav. Retrieved 27 November 2015. https://corporate.discovery.com/our-company/leadership/
[15]Jean-Briac Perrette. Retrieved 27 November 2015. https://corporate.discovery.com/our-company/leadership/
[16]Andrew Warren. Retrieved 27 November 2015.https://corporate.discovery.com/our-company/leadership/
[18]Velocity’s Darcy Tomlin Segues To Discovery’s Intl Content Group In VP Role.Retrieved 28 November, 2015.http://deadline.com/2015/10/darcy-tomlin-named-discovery-networks-intl-vp-programming-operations-1201581144/
[23]Discovery Communications agrees To Take Full Control of Eurosport. Retrieved 28 November, 2015.https://corporate.discovery.com/discovery-newsroom/discovery-communications-agrees-to-take-full-control-of-eurosport/
[24]IOC awards all TV and multiplatform broadcast rights in Europe to Discovery and Eurosport for 2018-2024 Olympic Games. Retrieved 28 November, 2015. http://www.olympic.org/news/ioc-awards-all-tv-and-multiplatform-broadcast-rights-in-europe-to-discovery-and-eurosport-for-2018-2024-olympic-games/246462
[25] Discovery to Stay in Russia with National Media Group Deal. Retrieved 28 November, 2015. http://variety.com/2015/tv/global/discovery-to-stay-in-russia-with-national-media-group-deal-1201579590/
[26]Russian Government Approves Discovery’s Joint Venture With National Media Group. Retrieved 28 November, 2015. http://www.hollywoodreporter.com/news/russian-government-approves-discoverys-joint-829832
[27]Discovery to Stay in Russia with National Media Group Deal. Retrieved 28 November, 2015. http://variety.com/2015/tv/global/discovery-to-stay-in-russia-with-national-media-group-deal-1201579590/
[28]Discovery finds rapid growth in international expansion. Retrieved 28 November, 2015.https://technology.ihs.com/551573/discovery-finds-rapid-growth-in-international-expansion
[29] Discovery finds rapid growth in international expansion. Retrieved 28 November, 2015.https://technology.ihs.com/551573/discovery-finds-rapid-growth-in-international-expansion
[31] TV Review: ‘Exorcism: Live! Retrieved 28 November, 2015. http://variety.com/2015/tv/reviews/exorcism-live-review-destination-america-the-exorcist-house-1201629070/
[32]Halloween Scares Up Televised Live ‘Exorcism.‘Retrieved 28 November, 2015. http://news.discovery.com/history/religion/halloween-scares-up-televised-live-exorcism-151028.htm
[33]Exorcism: Live! Creator on Cleansing House That Inspired The Exorcist: ‘It Is Not a Hoax.’ Retrieved 28 November, 2015. http://www.people.com/article/exorcism-live-sneak-peek-interview
[34] History or Exorcism House. Retrieved 28 November, 2015.http://www.destinationamerica.com/tv-shows/exorcism-live-countdown/exorcism-live-the-history/
[36]Exorcism: Live! Possesses Top Ratings Spot for Live Cable Event in October. Retrieved 28 November, 2015. https://corporate.discovery.com/discovery-newsroom/exorcism-live-possesses-top-ratings-spot-for-live-cable-event-in-october/
[37]Exorcism: Live! Possesses Top Ratings Spot for Live Cable Event in October. Retrieved 28 November, 2015. https://corporate.discovery.com/discovery-newsroom/exorcism-live-possesses-top-ratings-spot-for-live-cable-event-in-october/
[38]Don’t Miss Exorcism: LIVE! Retrieved 28 November, 2015 https://www.youtube.com/watch?v=L1UKWPkkwHo
[40] Discovery Family Channel Reunites Grateful Owners With Meaningful Mementos In Heartwarming New Series, Lost And Found. Retrieved 28 November, 2015. https://corporate.discovery.com/discovery-newsroom/discovery-family-channel-reunites-grateful-owners-with-meaningful-mementos-in-heartwarming-new-series-lost-and-found-wt/
[41]Discovery Family Channel And VolunteerMatch Empower Families To Give Back In Their Local Communities. Retrieved 28 November, 2015. http://www.prnewswire.com/news-releases/discovery-family-channel-and-volunteermatch-empower-families-to-give-back-in-their-local-communities-300158796.html
[42] This November, Discovery Family Channel’s Project Thank You Encourages and Empowers Viewers to Have an Attitude of Gratitude. Retrieved 28 November, 2015. https://corporate.discovery.com/discovery-newsroom/this-november-discovery-family-channels-project-thank-you-encourages-and-empowers-viewers-to-have-an-attitude-of-gratitude/
[43]Discovery Communications Inc. Series A. Retrieved 28 November, 2015http://quotes.wsj.com/DISCA/company-people
[49]Discovery Communications Details Plans For Long-Term Growth at Investor Day. Retrieved 28 November, 2015. http://ir.corporate.discovery.com/mobile.view?c=222412&v=203&d=1&id=2091481
[50]Discovery Communications Details Plans For Long-Term Growth at Investor Day. Retrieved 28 November, 2015. http://ir.corporate.discovery.com/mobile.view?c=222412&v=203&d=1&id=2091481
[51] Brand Value: TV Content Providers Have Their Say. Retrieved 28 November, 2015. http://www.broadbandtvnews.com/2015/11/26/brand-value-tv-content-providers-have-their-say/
[52]Fraud, Deception And Lies: How Discovery’s Shark Week Became The Greatest Show On Earth. Retrieved 28 November, 2015. http://blogs.discovermagazine.com/science-sushi/2014/07/18/fraud-deception-lies-discoverys-shark-week-became-greatest-show-earth/#.Vl9604RX-UV
[53]Discovery Channel Is Finally Breaking Up With Bad Science. Retrieved 28 November, 2015. http://www.motherjones.com/media/2015/11/racing-extinction-climate-change-discovery-john-hoffman
[56]Discovery Channel Is Finally Breaking Up With Bad Science. Retrieved 28 November, 2015. http://www.motherjones.com/media/2015/11/racing-extinction-climate-change-discovery-john-hoffman
Cesar Conde Chairman, NBCU International Group & Telemundo Enterprises
Robert Greenblatt Chairman, NBC Entertainment
History
NBC History (Source: Rocketland Photography/Pinterest) [24]
NBC Universal traces its roots to the National Broadcasting Company. NBC was founded in 1926 as a radio broadcasting company by the Radio Corporation of America (RCA).[2] NBC is the oldest major broadcast network in the United States. They began television broadcasts in the late 1930s as one of the first major television networks. NBC Universal was formed when NBC and Universal merged in 2004.[3] The new company was owned by General Electric and Vivendi. Then, in 2009, Comcast announced plans to buy a controlling 51% stake in NBCU. [4] The deal went through and GE owned 49% of the company following the acquisition. In March of 2013, GE divested its stake resulting in Comcast owning 100% of the company. [5] Comcast continues to own the entirety of NBC Universal to this day.
Financial
Comcast stock has been on the rise over the past three months. As a whole, the stock has climbed by about $5. In their 2015 Quarter 3 earnings report on October 27, NBC Universal has also been doing well as part of the Comcast portfolio.[6] NBCU revenue increased 20.8% and NBC ranked as number one among adults 18-49 for the fifth summer in a row. NBC also won the opening two weeks of the broadcast season for the fourth straight year among adults 18-49.
Comcast stock prices over the past three months. (Source: Google/Yahoo Finance)[22]
What’s New for NBCU
Seeso
The biggest story right now for NBCU is the imminent launch of their new internet streaming comedy service called Seeso. The service launches on December 3 in a public beta.[7] Users will be able to sign up with an e-mail address and the service will be free for the first month. After this initial beta, the service will cost just $3.99 per month.[8] Rather than targeting broader demographics as services like Netflix or Amazon Prime do, Seeso aims to target a more narrow market: comedy fans. NBC hopes to use the service to mine the value of its comedy programming like Saturday Night Live, and all of its late-night comedy programming.[9] This service won’t just recycle content that’s already aired, however. Its biggest selling point is the original content. The service will launch with 20 original programs in its first year alone. Dan Harmon, best known for creating NBC’s Communityand Adult Swim’s Rick and Morty,[10] will be a driving force behind the creation of original content for Seeso.[9] Beta members will also get access to a live stand-up comedy special “The Guest List: Live From The Barrel House” which will stream on December 8th, exclusively on Seeso.7 NBCU mentions that the service will be available in full in January including access to connected devices, however it does not specify which devices (AppleTV, Roku, Amazon FireTV, etc.) it will be available on.
Over-the-top services are the story right now for NBCUniversal. In October, Amazon and NBCU were rumored to be in talks about creating a live-streaming option on Amazon’s popular Fire TV platform for NBC content.[11] The option would allow users to access NBC content live as well as on-demand via Amazon’s set top box. Nothing has yet been confirmed by either Amazon or NBCU, however just a few weeks ago, CBS launched its “All Access” service which allows for CBS on-demand and live content on the Fire TV.[12] It is more than likely that NBC will be soon to follow. Important to note is that NBC News already has an Amazon Fire TV app which allows for viewing of live and on-demand content, but this applies only to news content.[13] It does not include NBC’s vast collection of entertainment content. The rumored new application would allow for the entire NBC collection as well as expanded live programming options.
As NBC looked forward at the beginning of its fall season, they were counting on old, reliable shows to bring them the numbers they’d gotten in the past. As usual, The Voice, The Biggest Loser, andDatelinereturned as perennially successful programs.[14]Sunday Night Football also continues to be number one in primetime ratings and will continue to be broadcast through the fall season. NBC’s fall slate of shows, however, has seen relatively low ratings across the board.[15]The Player, receiving a dismal 0.83 rating, already had its order reduced from thirteen episodes to nine before being cancelled.[16]Truth Be Told(0.63) and Undateable(0.77) are already airing Friday nights and are likely next on the NBC chopping block. Grimm is pulling a 0.98 rating on Fridays and is still hanging on in its fifth season. No word yet on its cancellation.
The Wiz! Live
David Alan Grier as the Cowardly Lion (Source: NBCU/AdAge) [19]
Well known for its past live events, NBC is now producing The Wiz! Live to air on December 3rd.[17] In the past, NBC has produced Peter Pan Live, and The Sound of Music Liveto fairly good ratings (2.4 and 4.6 respectively[18]) and they hope to capitalize on this “live event” success with The Wiz!. Starring Queen Latifah, Mary J. Blige, David Alan Grier, Stephanie Mills, Common, and newcomer Shanice Williams as Dorothy, the star power is there for a good event.[19] NBC has also secured a variety of sponsorships for the broadcast with some of the same sponsors who funded past live events returning again. The live event should have very little in the way of competition in its Thursday night time slot.
Macy’s Thanksgiving Day Parade
A perennial ratings boon for NBC, the annual Macy’s Thanksgiving Day parade did not disappoint in 2015. The three-hour event drew a 12.6 rating, the highest of any program all season.[20] The broadcast also pulled in a 7.0 rating among adults 18-49 which is up slightly from the previous year’s broadcast.
Macy’s Thanksgiving Day Parade (Source: forthemommas.com) [27]
AMC Networks was founded in 1980 under the name Rainbow Media. A joint venture between NBC and Cablevision Systems Corporation, it intended to provide special interest programming to niche audiences [6]. In 2011, Rainbow Media spun off as AMC Networks to publicly trade on the NASDAQ under current President Josh Sapan, and AMC Networks was born [7]. Since, AMC Networks has surfaced to the forefront of specialty and original programming.
Currently, AMC Networks owns AMC, BBC America, IFC, Sundance TV, We TV, IFC Films, and AMC Networks International[9]. Among their most popular shows are The Walking Dead, Breaking Bad, Better Call Saul, Mad Men, and, more recently, Doctor Who and Fear the Walking Dead [10]. AMC Networks have some of the most-watched content on television. They have incorporated Rainbow Media’s ideas of providing specialized programming rather than general content that could appeal to a broader audience [11] to great success. The AMC channel has had great success with its original content. To date, its series have the top three most-viewed debuts in cable television history [12].
2015 Ratings Drop
Ratings for this season of The Walking Dead dropped 15% from last year, causing AMC Networks’s stock to drop 5.1%. Economist Michael Morris of Guggenheim Partners attributed this to the company’s over-reliance on the show. However, he went on to say that the financial reaction may have been excessive. The debut provided apt competition with the NFL that weekend, and has consistently sat at the top of original cable programming throughout the season’s run [13].
In addition to the original content on the AMC channel, AMC Networks produces original content on their IFC and SundanceTV channels. They also produce original reality content on their channel WeTV.
By far AMC Networks’s most significant and instantly-rewarding act in the last year has been to enter into a partnership with BBC Worldwide in 2014, purchasing an operationally controlling, 49.9% equity stake in BBC America [16]. This allowed AMC to renegotiate BBC America’s cable costs, along with the rest of its channels, due to the increased value of content [17]. This follows CEO Josh Sapan’s interest in developing AMC Networks into more of a global company: controlling international content being distributed in the United States as well as increasing overseas distribution.
AMC Networks’s other major acquisition of the last year has been that of Chellomedia form Liberty Global. AMC Networks owns the entirety of Chellomedia, which they have rebranded as AMC Networks International. This has gained AMC Networks a “suite of networks” distributing to 390 million homes in 138 different countries.
These networks largely carry entertainment programming and movies, similar content and (presumably) similar audiences to those whom AMC Networks already reaches. The deal has two big advantages: it will allow the company to expand its other international programming channel, IFC Films, and it will give original content not before distributed to these markets a second run. This especially will come in handy for shows currently nearing their end in the company’s current markets [19].
International Concerns
AMC Networks’s international efforts have yet to pull their own weight, posting consistent losses as they find their footing in foreign markets. Domestic production has more than made up for the losses, however, allowing AMC Networks to exercise more patience and wait for the international networks to become profitable. For example, in its most recent quarter, the network’s International and Other divisions posted a $6 million increase in operating loss [20], but that was balanced by a 50.2% growth in operating income [21] from the National division. The final result was a 44.5% ($49 million) overall increase in operating income. The BBC America acquisition has affected this number by lessening the losses in operating income. CEO Josh Sapan has repeatedly voiced his faith in the prospects of these divisions building momentum [22].
Financial Status
AMC Networks Stock Performance in 2015. Source: NASDAQ [23]. For more and real-time stock info, click here.
AMC Networks performed outstandingly in the third quarter of 2015. Net revenues increased 21.7% ($113 million), a full $632 million overall over the same period last year. Adjusted Operating Cash Flow (AOCF) [24] rose to $191 million, a 34.3% increase over the same period last year. This number is perhaps the most significant as it represents an increased ability to produce new and better content.
Their stock quote as of December 2, 2015 posts an $83.10 average at a volume of 767,441, earning $4.85 per share [25].
Strategy
AMC Networks make most of their money from owning and operating some of the most critically-acclaimed, popular, and recognizable content brands on cable and distributing those brands as widely as possible. At their disposal, their biggest strengths are a strong industry presence and portfolio of brands, a broad distribution reach on their national networks, award-winning content, a strong revenue from their affiliation agreements. All of this makes them a highly sought-after advertising platform.
Some of their biggest difficulties include intense competition, a small number of distributors for their networks, shifting audience tastes, continuing to produce popular programming, viability of their business acquisitions, and a significant debt .
Conclusion
If AMC Networks is not the top cable network, it certainly lies among the best. Their popularity and quality of content makes it one of the highest rated networks in most markets. At the moment, their greatest aim is to expand their content to an international level, which would be greatly beneficial to their ratings if their original content can get a complete second run in foreign markets that have not yet seen it, even after the content’s run in AMC’s current markets has finished. As seen in the figure below, AMC Networks is on an upward trend, its relative youth and high cost of producing high-quality content slowing its ascent relative to its peer group. Increased international distribution and the BBC America acquisition will help to make AMC Networks more competitive in this standing [26].
AMC Networks 4-year Performance Chart [27]. Source: United States Securities and Exchange Commission
CEO Josh Sapan, the skilled leader who led the network to the top after the 2011 split from Cablevision, will remain at the helm, leading the international expansion. They have the necessary solutions in the works for the possible challenges they face in the future, viewers switching to more digital habits, a need for new high-quality original content, and the unsustainability of their international ventures. Overall, AMC Networks is a solid company, a solid investment, and a solid advertising prospect.
SiriusXM was originally two separate companies, Sirius Satellite Radio and XM Satellite Radio. Sirius Satellite Radio was founded in 1990 by Martine Rothblatt, David Margolese, and Robert Briskman. XM Satellite Radio was founded in 1988 by Gary Parsons and Hugh Panero. Sirius Satellite Radio and XM Satellite Radio merged in 2008, to become SiriusXM Radio. They were the United States’ only two satellite radio services. The merger was being questioned for years because many people thought that it would make it a monopoly. To this date, that has been proven wrong, because it is not a monopoly and terrestrial radio is still doing fine.
About
SiriusXM is a subscription-based radio service, which currently has 27.3 million subscribers (1). SiriusXM is commercial-free, and creates and broadcasts over 175 channels. These channels range from live sports, entertainment, talk and news shows, to any genre of music imaginable (2). The company also has SiriusXM Traffic and NavWeather, along with other options to provide details on traffic and weather. SiriusXM can be listened to in a car, plane, or even on a boat, as well as on a smartphone and tablet. Click here to find out the vehicle availability of SiriusXM. SiriusXM likes to say of their service that “It’s wherever you are,” and, “It’s wherever you go.” SiriusXM’s main competitors are Clear Channel Communications, Cumulus Media, and WestwoodOne (3). These companies are competitors because of their involvement in radio, except they are terrestrial radio companies, not satellite.
Financials
SiriusXM is a publicly traded company on the Nasdaq. Its past 52-week range is 2.98-4.04 (4). SiriusXM repurchased 739 million shares in 2014, which returned $2.5 billion to the stockholders. The company also returned to the number one shorted Nasdaq stock (5). SiriusXM announced that they will be releasing the First Quarter results of 2015 on April 28th. As for 2014, their yearly revenue rose 10% to $4.18 billion. Their net income rose to $493 million, which was an increase of 31% from its net income of $377 million in 2013. Its fourth quarter net income was $143 million, compared to $65 million in the fourth quarter of 2013. These increases are staggering, but might come from the large amount of total new subscribers that SiriusXM received, 1,751,777, which completely exceeded their expectations of 1,250,000 (6).
Live Broadcasting
Recently, SiriusXM seems to have been attempting to make a huge splash with live broadcasting. The company has been and will continue to broadcast live sports and music festivals. In March, they announced that they would be offering live coverage of the NCAA Men’s Basketball Division I Championship (7). In April they announcedthat SiriusXM would be covering the 2015 NBA playoffs. With this coverage, they will include daily programming of the SiriusXM NBA Radio (8). Also in April, SiriusXM Canada announced that they will have live coverage of every single NHL Playoff game. To broadcast the NHL playoffs, they will be using SiriusXM NHL Network Radio, SiriusXM’s main station for hockey (9). In March, SiriusXM announced that they would be broadcasting live coverage from the 2015 PGA Masters. With this, they had a total of 24 hours of live coverage spread throughout the four day tournament, plus 80 hours of never before heard audio from the Augusta National archives (10).
In March, SiriusXM had a live coverage of DJ sets from Ultra Music Festival (11). This was major because they even made a temporary station solely for this purpose, titled UMF Radio. On this station, they had the live DJ sets as well as interviews. Also, for the first time ever, Coachella, the two weekend music and arts festival in Indio, California, was broadcasted live and exclusively on SiriusXM Radio. It was broadcasted over a variety of stations, some of which are BPM and Electric Area (12).
Recent News
SiriusXM just concluded their 2015 MLB Spring Training Tour. The hosts were Mike Ferrin, Casey Stern, former General Managers Jim Bowden, Jim Duquette, and Steve Phillips, as well as World Series Champion Todd Holandsworth (13). SiriusXM does this tour yearly to provide the most in-depth coverage of the MLB Spring Training available on any radio format. Also, SiriusXM is the only radio broadcaster that covers every game live, play-by-play for every single team in the league throughout the season.
SiriusXM announced in April 2015 that its subsidiary, Sirius XM Connected Vehicle Services, made a deal with Nissan. The services that they will offer are for convenience, safety and security (14). Sirius XM Connected Vehicle Services are in nine different car manufacturers, including Nissan. On the Nissan models, there will be three different packages, the NissanConnect Services, the NissanConnect Services Premium, and the NissanConnect Services Premium Plus (14). Also in the vehicle industry, Jaguar and Land Rover announced that they will use Sirius XM Connected Vehicle Services in a way where it can connect to the vehicle’s already made infotainment systems to provide call center support for safety and security reasons (15). SiriusXM and Jaguar and Land Rover have all been working together for over ten years now, so it is a good sign that they are beginning to use SiriusXM for more reasons other than just entertainment. SiriusXM is clearly trying to expand their horizons in the vehicle industry, so that they are not just a radio service.
In March, it was announced that comedians Jeff Foxworthy and Larry the Cable Guy will launch their own channel exclusively with SiriusXM. The two comedians will produce the channel and have live comedy shows that can only be heard on their channel with SiriusXM, and nowhere else (16). Another new channel that was announced in March will be executive produced by Andy Cohen, the talk show host of “Watch What Happens Live.” All that is known is that he will personally select what is spoken about on the show when the time comes (17).
Overall
SiriusXM had a great year in 2014, which can be proven by the incredible amount of new subscribers and also by the revenue and net income comparisons to 2013. Hopefully these ecstatic numbers continue and SiriusXM continues to be a dominant force in the radio industry in the years to come.
