Some of my thoughts on media & entertainment business … if you were forwarded this email and want to receive regular updates, click here:
Little late to the new year, but happy Q2! At the beginning of 2022, I connected with an alumni of my fraternity who is currently pursuing an MBA at NYU Stern and headed to a streaming studio’s strategy group. Brendan loves all things media/entertainment and will be writing here as well.
Gaming an IP Engine
For those of us in New York City, it feels like we’ve spent the past two weeks living inside a Halo advertisement. Imposing images of lead character “Master Chief” and Co. have adorned subway cars and digital billboards promoting the series premiere on Paramount+. We’re not particular interested in Halo’s launch, but rather what it represents in terms of gaming IP crossing into streaming.
Gaming Special Sauce Video games represent a treasure trove of beloved IP that has largely been untapped by film and television. The Marvel Cinematic Universe’s success has demonstrated how valuable known (and loved) IP can be if executed properly. For companies where comic book IP isn’t accessible (and even for those where it is), gaming IP presents a similar opportunity. This explains why we are about to see a deluge of video game-based content. Halo comes on the heels of Netflix’s The Witcher, Sony’s Uncharted and a following avalanche.
Let’s look back at the Disney flywheel. The model illustrates how valuable IP can be if it lends itself to multiple forms of monetization. Film and television have always leveraged IP from other mediums (books, podcasts, etc), but thus far only begun to realize the potential of gaming properties. Gaming shares many of the qualities that have allowed comic book IP to found successful franchises (fantastical characters with myriad action-based narrative arcs) with two additional strengths. One, games engender a unique level of loyalty and passion due to the active role the audience plays in the story. Two, the monetization opportunities with gaming IP are far greater than any other medium, with strong execution potentially leading to multiple cross-sell and up-sell opportunities. Paramount+ sign ups and Xbox’s Halo Infinite sales attributable to Halo’s premiere will be interesting data points to validate these strengths.
Who can do it? This massive synergistic opportunity leads me to believe that the winners will be the entertainment companies that are able to successfully incorporate gaming into their business models. Netflix, Amazon, WarnerMedia and others have all indicated how critical gaming is to their future, signaling future integration is inevitable. Of the streamers, Warner seems best suited to succeed in the space, given they already have a studio capable of making high-quality, AAA games and a bevy of IP that translates well. If Zaslav and team can steer the firm through the next few years of the streaming wars, expect a gaming acquisition as their next big move.
- Brendan and Sean
Other Highlights
Anyone still watching Awards Shows?
What I’m Streaming…
The craziest part of this story was learning that Jared Leto is 50 years old.