trouble in tinseltown
It’s happening: America’s $134 billion film and TV industry has ground to a halt after the Hollywood actors’ union voted to strike, joining screenwriters and shutting down nearly all production.
The move reflects the growing aggression of the US labor movement, which has been fighting back against Starbucks, Amazon, UPS and others. Only in this case, the dispute involves one of the most visible industries — and shows no sign of a settlement.
The actors’ union criticized the studio for refusing to budge on key issues, These include high payouts from streaming titles and clear limits on the use of artificial intelligence. TV actor Fran Drescher, who now leads the SAG-AFTRA union, said yesterday, “How they plead poverty, that they’re losing money left and right while giving hundreds of millions of dollars to their CEO.” “this is sick. shame on them!”
The studios argue that the unions’ demands are unrealistic, Looking at the challenges facing the entertainment industry from streaming to the impact of the pandemic. “It’s the worst time in the world to raise that disruption,” Bob Iger, CEO of Disney, said yesterday on CNBC. (more on that later)
Expect more such comments on the media company’s earnings call next week.
The Tinseltown glitz quickly faded. Because actors are now forbidden from promoting their films, the cast of Christopher Nolan’s “Oppenheimer” walked out of the film’s London premiere. And promotion for shows nominated for Emmy Awards, which were just announced Wednesday, was suspended.
This would have consequences for other Hollywood industries, including advertising and talent agencies, celebrity and trade publications, and film festivals. “The celebrity factory is closed,” Janice Min, head of entertainment publication The Ankler, told Vanity Fair. “If this goes on long enough, you’ll feel it all over the internet.”
In some ways, the strike may actually advantage studio and streaming platform. The dearth of new shows and movies may have forced them to back out of the expensive production deals signed during the content boom.
But the longer the strikes go on, the more viewers may grow weary of the lack of fresh scripted content. (Fall TV schedules are packed with reality and game shows.) Streaming giants with huge libraries may be fine, but less-stocked services face a flood of cancellations, and studios selling to other platforms are increasingly in dire straits. Can get in trouble.
What’s going on over here
The SEC’s crypto crackdown has come as a blow. The regulator has argued that digital assets should be treated as securities, but a A judge ruled yesterday that crypto company Ripple did not violate securities laws in selling its token, XRP, on public exchanges. Elsewhere, Alex Mashinsky, the founder of bankrupt crypto lender Celsius, was arrested on charges of fraud and lying about the firm’s business model.
Aspartame has been declared a possible cancer risk. The World Health Organization, along with research agencies, has stated that the widely used artificial sweetener is a possible carcinogen. Experts disagree on what constitutes an unsafe level of consumption, but Wall Street analysts say the warnings could hurt sales of diet soda and other products.
Tucker Carlson is reportedly planning to start a new media company. Neil Patel, a former Fox News host and White House adviser under George W. Bush, is seeking to raise money for a membership-driven venture, according to the wall street journal, Last month, Carlson returned to the public eye with a Twitter version of his popular Fox show, but its audience remains in heavy decline,
A New Era of Dealmaking at Disney?
A day after Bob Iger extended his tenure as Disney CEO for two years, the entertainment mogul suggested he is considering a major overhaul at the media giant, including potential deals For other channels like ESPN and ABC.
The comments indicate that Iger, who oversaw some of Disney’s biggest acquisitions, could still make more deals — even if as a seller. The big question is, with whom will he do it?
Iger is under pressure to turn around Disney’s fortunes, After thousands of layoffs and cost-cutting. Although he has led the challenge from activist investor Nelson Peltz, shareholders may not be happy with Disney’s stagnant stock price.
Here’s what the Iger shake-up could look like:
-
Disney could sell a stake in ESPN, which has been suffering from a steep decline in cable subscriptions, to a partner that could help the sports network improve its online reach and pay for increasingly expensive broadcast rights. Likely candidates are tech titans with online video platforms, including Apple (a frequently rumored buyer for Disney, antitrust concerns aside), Google and Amazon.
-
Buyers of cable channels such as ABC and FX are less clear, as a deal with another media giant could lead to protests from antitrust regulators. Wells Fargo analyst Steven Cahall predicted that private equity or hedge fund Businesses may jump at the temptation of steady cash flow and the opportunity to cut margins (as they have done with newspapers).
How serious is Iger about selling? His comments may be meant to test investor reaction. (He previously hinted that Disney might sell its majority stake in Hulu, before saying that Comcast is more likely to buy the stake in the forum.) Disney’s shares barely moved yesterday following his comments.
But Iger has been pessimistic about traditional TV for some time now. “Linear TV is heading towards a big ditch and it will be removed,” he said. said at the code conference Last year. “I can’t tell you when, but it goes away.”
Leena Khan’s unlikely fan club
A tough week for FTC chairperson Leena Khan ended with a grilling on Capitol Hill. On Tuesday, it lost a bid to block Microsoft’s $70 billion acquisition of Activision-Blizzard. The regulator appealed against the decision, but an attempt delay the deal While its challenge was dismissed after hearing.
But even as the FTC is facing a court battle over one fight, it has opened another by launching an investigation into ChatGPT maker OpenAI to determine whether the chatbot is harming consumers.
The news meant all eyes were on Khan’s appearance before the Republican-led House Judiciary Committee, which was billed as an investigation into his “mismanagement” after several unsuccessful legal challenges. But the hearing revealed surprising support from some of his cross-examiners.
Republicans questioned his strategy. Khan was pressed as to why the FTC is appealing Microsoft’s decision when other jurisdictions, such as the European Union, have approved the deal. (He declined to comment.) Khan also faced accusations and threats. “Actions have consequences, Madam Speaker,” warned Republican Ben Kline of Virginia, who said the Appropriations Committee was considering the FTC’s budget requests and sought more in response to the agency’s “rank favoritism.” The amount was less than that was fixed. Khan was not given a chance to reply.
But Khan found some unlikely fans. Matt Gaetz, a conservative Republican and fellow attorney from Florida, told her, “I want to encourage your work.” He appreciated the crackdown on data brokers selling sensitive information. Gaetz noted that legal defeats are common when pressing new issues, and urged Khan to seek help from Congress “if the laws are insufficient”.
Others praised Khan’s tough stance on Big Tech. Republican Ken Buck of Colorado pointed out that Khan, unlike some of his congressional colleagues, had no financial ties to tech companies. He said of businesses like Google and Meta, “They spent $250 million against bills that passed this committee in the last Congress.”
Buck said that both he and Khan knew about ,The “need to update antitrust laws” for a new economy led Khan to say that today’s rules are based on assumptions that do not hold true for the digital age.
-
In other news: Britain’s antitrust regulator, which blocked the Microsoft deal in April, to reopen its probe a day after a US court ruling extend deadline Six weeks’ time should be given for its investigation. Allegedly companies can do this Sell some British cloud gaming rights to win approval.
PGA Tour cancels no-poach agreement
With regulatory scrutiny intensifying, the PGA Tour has removed one of the binding provisions built into its tentative deal with the Saudi-backed LIV Golf League: a no-poach agreement that could have been legally problematic.
According to reports by Alan Blinder and Kevin Draper of The Times and Lauren Hirsch of DealBook, the provision, which was supposed to cover players from the Tour and LIV, was shelved to avoid anger from the Justice Department.
The nonsolicitation clause was seen as a way to prevent an exodus of tour golfers to the LIV, Which used huge prize money to lure top players into separate leagues. ,Rory McElroyOne of LIV Golf’s staunchest opponents, said yesterday that he would prefer to leave the sport than play for a rival competition, despite offers of money.) The White House is making such agreements. Former FTC Chairman William E. Kovacic told DealBook, “This language seems to fit right in with the vision that the Justice Department has laid out for its victimless enforcement program.”
There was more problematic language at this week’s Senate hearing Involving PGA Tour Officials, Antitrust experts have focused on the comments of Jimmy Dunn, the vice president of Piper Sandler who is on the board of the Tour. He testified before the Senate Permanent Subcommittee on Investigations that he feared the deep-pocketed LIV would “destroy the tour”, necessitating negotiations for an alliance.
Gerald Mattman, head of the workplace class-action group at the law firm Duane Morris, told DealBook that such statements could underline concerns that the deal was done to strengthen the Tour’s lock on the market. “Loose lips can sink a ship with an attitude of disbelief,” he said.
read speed
deal
-
exxon mobil agreed to buy Carbon-storage company Danbury for $4.9 billion. (Reuters)
-
Adobe faces $20 billion bid for Figma probing in depth by the UK antitrust regulator. (ledge)
-
Silicon Valley Startups Looking For sales to large companies As venture funding dries up. (ft)
Policy
-
james bullardThe St. Louis Fed president will step down to become dean of Purdue University’s business school. (Reuters)
-
“Big Tech’s Love Affair.” low tax nations Endangered” (WSJ)
best among the rest
-
“‘An Act of War’: Inside America’s Silicon Blockade Against China” (NYT)
-
Companies are leaving London’s Canary Wharf, reflecting a wider shift that is also affecting office districts in cities such as New York and Chicago. (NYT)
-
Tomorrow’s Wimbledon Women’s Final Will Be Winner Again first time grand slam champion – This has been a common occurrence since Serena Williams won her last major tournament in 2017. (WSJ)
We need your feedback! Please email ideas and suggestions to dealbook@nytimes.com.
