Explore Wall Street’s reaction to Fox, Disney, and Warner Bros’ sports venture. Insightful analysis of market impact and industry response.
The recent announcement of a joint venture between media giants Fox, Disney, and Warner Bros to create a standalone sports service has sent shockwaves through Wall Street. While the move promises to reshape the sports streaming landscape, the reaction from investors has been swift and severe, with stocks of local TV station operators plummeting in response.
EW Scripps CEO Adam Symson expressed frustration at what he deemed an overreaction from Wall Street. Following the announcement, EW Scripps’ stock plunged by more than 27%, reflecting concerns about the impact of the new venture on local affiliates. Symson sought to allay fears, emphasizing that affiliates would be compensated for their inclusion in the so-called skinny bundle.
“It’s not the efficient bundle Wall Street is making it out to be,” Symson told CNBC, urging investors to reconsider their assessment of the situation.
Other major local TV station owners, including TEGNA and Sinclair, also saw significant declines in their stock prices. Sinclair, which operates roughly 200 stations nationwide, dropped by 12% on the day of the announcement, while TEGNA, owner of 68 TV stations, experienced a nearly 7% decline.
Symson argued that investors may be overlooking the value of including local ABC and Fox affiliates in the new streaming service. While the venture promises a trove of sports content from Disney-owned networks like ESPN and ABC, it will not offer access to CBS or NBC.
“People don’t want to go to a buffet where half the steam trays are missing,” Symson remarked, suggesting that consumers may be dissatisfied with a partial offering.
Despite concerns about the impact on traditional cable TV, some experts believe that the new streaming service may not spell the end for pay television. Robert Thompson, a professor at the S. I. Newhouse School of Public Communications at Syracuse University, noted that while the $40-a-month price point may attract sports enthusiasts, there will still be demand for content not available on the platform.
In conclusion, while the joint sports venture between Fox, Disney, and Warner Bros promises to shake up the sports streaming landscape, its impact on traditional television and the broader media industry remains uncertain. As investors grapple with the implications of this seismic shift, one thing is clear: the battle for viewers’ attention is fiercer than ever before.