Media Bytes #5
Universal props up sibling Peacock in licensing deal and YouTube gets its own theater
Some of my thoughts on media & entertainment business … if you were forwarded this email and want to receive regular updates, click here:
Comcast Conflicted
Universal Pictures announced a multi-partner Pay-One window deal with Peacock , Amazon and Netflix. Starting with Universal’s 2022 film slate, Peacock will have exclusive streaming rights for 4 months, a period beginning no later than 120 days after a film’s theatrical release. Then, Prime Video gets Universal’s live-action films for the next 10 months while Netflix gets Universal’s animation titles. THEN, all 2022 movies go back to Peacock exclusively for the last 4 months of the 18-month Pay-One window. 😵
This news is interesting because the multi-partner structure allows us to pontificate about Comcast’s feelings on Peacock.
So what is a Pay-One window? When it comes to film distribution, “windows” refer to periods when certain platforms have rights to show movies. A Pay-One window is the period when movies go to premium subscription networks like HBO, Starz, Epix and now the big streamers. Traditionally, the windows looked like this:
Theatrical release
Transactional Video on Demand (TVOD)
Premium subscription services (Pay-One)
Cable TV for free
Back to premium subscription services (Pay-Two)
Since 2005, HBO has had Pay-One rights to Universal’s films. However, given the increased competition amongst streamers, it’s not surprising Universal and Peacock are linking together with (probably) a strong nudge from Mother Comcast. Refresh of the family tree here.
So what? Well, it’s just odd that Comcast/NBCU/Universal/Peacock aren’t following the moves of other studios/streamers to keep all their goodies in-house:
Disney/Marvel/Lucasfilm > Disney+
AT&T/WarnerBros > HBOMax
Sony > Netflix (I know Sony doesn’t own Netflix, more of a Pay-One alliance)
MGM and Paramount have legacy deals with Epix but I’m sure Amazon and ViacomCBS will bring their content back home once the deals expire
So why did Comcast/Universal opt to auction off the middle 10 months instead of going all-in with Peacock? I call it conflicted nepotism.
Comcast can’t not give Peacock some exclusive rights to Universal’s slate; but Comcast also found it difficult to turn down billion dollar licensing deals. This tells me Comcast isn’t fully confident in Peacock’s future. Unlike the other studio/streamer combos, Comcast did not have the cojones to double down on Peacock and go for sub acquisition at all costs. A Comcast strategic finance team somewhere said, “Hey, even with the Tokyo Olympics this summer, Peacock isn’t going to get to 50 million subs anytime soon. Let’s get that Amazon and Netflix money.” Moreover, the Comcast and NBCU team were realistic about the current state of 3 million paid subs on Peacock, not worth exclusive distribution for all Universal films.
Still, don’t count Brian Roberts and Comcast out of the streaming wars just yet. I have no doubt Roberts has his bankers working around the clock on new M&A targets, even Warner Bros Discovery.
Other Highlights
M&A
Reese Witherspoon’s production company, Hello Sunshine, exploring sale
Lebron’s SpringHill Company exploring sale with valuation ~$750mm
A24 reported to have explored possible sale at a valuation ~$3 billion
Dyal Capital close to acquiring a $1.5 billion stake in the Sacramento Kings. I haven’t thought about the Kings since the Mike Bibby + Vlade Divac days
YouTube Goes Physical
YouTube signed a multiyear deal for naming rights to the 6,000 person venue in Hollywood Park; introducing YouTube Theater. YouTube will also be the exclusive streaming partner of YouTube Theater (naturally), SoFi Stadium, Hollywood Park and the Rams and Chargers
Quentin Tarantino
QT adds to his movie theater collection by buying the sweet Vista Theater in the Los Feliz area of Los Angeles
“I have a living room, I want to go to the theater.” - Tarantino
Walt’s Thoughts 🦧🍻
What I’m Streaming…
Based on the comic book of the same name, this fable-toned series is set in a post-pandemic world where there are part human, part animal hybrids. I’m only on Episode 3 but I like shows where I’m thinking “wtf” throughout the pilot