Exactly...the media was so focused in on "the politics", as in "who will trump go with?", yadda-yadda-yadda, giving little or no analysis to the financials...Zaslav saw a sucker running up with big bucks, Daddy with a backstop, and Boom!, roped the two dickheads in! Oracle is in big trouble, over-invested in AI, Larry's boy cosplaying as Big Man in da media and H'wood...what could go wrong? Couldn't happen to two deserving losers.
The politics are the point. The Ellisons wanted to deliver CNN to Trump to go with TikTok and CBS, never mind the financials.
Their reward will come outside the Warner deal in the form of DoD contracts, merger approvals, DOJ/FCC/SEC harassment of competitors, and whatever other advantages unlimited access to state power can buy them.
Maybe, Bill, but consorting with Trump always - always - turns out to be a losing trade. And even if all those permissions and contracts arrive, they are one-hit sugar hits with no recurring business advantages
Fantastic analysis. My money is on Versant owner of CNBC financial channel and Jim Cramer and MSNOW! Perfect platform for talent from CNN, i.e. Rachel news network and trusted source! And Gemini you tube will benefit from on air talent who have an audience. I watch Heather Cox either on Dacebook or You tube. And because it is on YouTube it feeds into Google's AI Gemini as opposed to ChatGPT based on Wikipedia. Thanks for giving a rational discuss for the destruction by stupid people who know nothing about the entertainment business or the nurturing of creative talent for ego!
I don't know why we are confused, surprised or concerned when we live in a time of unfettered capitalism. This has been growing since the early 80's (at least.)
The collective "we" does not care enough to put an end to it and it will continue till it crashes.
This is fantastic Scott. Big fan our yours, thanks so much for all you do. Please do a speaking tour around the UK, or even just more content on M&A as selfishly I'm involved in the space and love reading or hearing your perspectives on it.
Calling it the worst acquisition in History is a little dramatic. Give it a couple of years to see if the new leadership team can turn this thing around.
Our dream 10 years ago was to be able to jump online (without having to align with a specific outlet) and watch any "movie" that you wanted too without a cost (or very small fee). Now consumers have to pay for 4-8 different platforms just to get frustrated in trying to find a specific show or content.
IMO, what Disney and Netflix does is market what THEY want the audience to watch and make it very difficult in some cases to search and find something that is actually worth the time to consume. The algorithms they use drive to push content is a whole other issue.
Amazon and YouTube have a different approach by increasing the "inventory of shows, movies, short content" and make it easier for consumers to find what they want. Better experience. I may have to pay a little extra but it is worth it.
By the way....Oracle knows a little something about housing large content for companies. Maybe this new group may actually open up that huge library and let consumer watch what they want.
The reason you can't watch what you want, when you want, where you want, isn't the technology. Those problems were solved a decade ago and nothing Oracle is bringing to the table will change that. The problem is IP licensing. The company that owns the distribution rights in market / region A is not the company that owns the rights in market / region B (or C or D or E). And the company that owns the theatrical release rights (ie cinemas) might not be the company that owns the TV rights, or the streaming rights, or the DVD/physical media rights. Multiple that by literally millions of movies and TV shows produced over a century of filmed entertainment, where the rights holders have gone bankrupt, been acquired, merged, spun-off or literally died and you have a Gordian knot of complexity that media orgs have been trying to deal with for years, at the cost of millions, and they still regularly get sued for failing to pay royalties to the right people and/or doing deals around IP that it turns out they don't actually own the rights for, or at least the *right* rights.
Quite literally, the only way to watch what you want, when you want, where you want, is via online piracy. Isn't it ironic, don't you think?
It’s hard to stay patient when history shows that WB’s massive debt usually drowns even the best intentions.
That said, you make a fair point about the Oracle connection…if the Larry Ellison stops chasing "prestige" and use that tech to actually fix the search and discovery mess, they might finally turn a bloated library into something people can actually use. We shall see….
Great analysis, but you're missing the point of the acquisition, for Ellison, this isn't about business, it's about gaining control of a media empire so he can push his political agenda and promote Trump.... if it was business, he would fund the purchase with his own money, not from a bunch of middle east backers and a vague token gesture of underwriting part of the debt
Thanks for this analysis. I agree with commenters that politics was at the centre of this. As such the deal was more about purchasing influence than about business, similar to Musk's purchase of Twitter.
This is the conservative playbook, and unfortunately they may have good reason to do so. If conservatives control CNN, the news on cable is even more skewed, at a time when most progressive media is retreating behind paywalls.
For the regular person sitting on their couch, this merger is basically "Subscription Exhaustion." It means your favourite shows are moving to yet another new app, the price is probably going up to pay off some billionaire’s debt, and there will likely be fewer original, risky shows because the accountants are now in charge of the "creatives." It’s the sound of the Golden Age of TV finally hitting the "End Credits."
Delightful writing and spot on analysis.
Exactly...the media was so focused in on "the politics", as in "who will trump go with?", yadda-yadda-yadda, giving little or no analysis to the financials...Zaslav saw a sucker running up with big bucks, Daddy with a backstop, and Boom!, roped the two dickheads in! Oracle is in big trouble, over-invested in AI, Larry's boy cosplaying as Big Man in da media and H'wood...what could go wrong? Couldn't happen to two deserving losers.
The politics are the point. The Ellisons wanted to deliver CNN to Trump to go with TikTok and CBS, never mind the financials.
Their reward will come outside the Warner deal in the form of DoD contracts, merger approvals, DOJ/FCC/SEC harassment of competitors, and whatever other advantages unlimited access to state power can buy them.
Maybe, Bill, but consorting with Trump always - always - turns out to be a losing trade. And even if all those permissions and contracts arrive, they are one-hit sugar hits with no recurring business advantages
Fantastic analysis. My money is on Versant owner of CNBC financial channel and Jim Cramer and MSNOW! Perfect platform for talent from CNN, i.e. Rachel news network and trusted source! And Gemini you tube will benefit from on air talent who have an audience. I watch Heather Cox either on Dacebook or You tube. And because it is on YouTube it feeds into Google's AI Gemini as opposed to ChatGPT based on Wikipedia. Thanks for giving a rational discuss for the destruction by stupid people who know nothing about the entertainment business or the nurturing of creative talent for ego!
like your comments, but we need major hubs, not just a TON of excellent substacks.
Both/and.
And the reality is that none of these deals should get done because they are all anti-competitive.
Excellent article. My analysis and thoughts very similar of another horribly overpriced ego driven deal.
Love watching as well the reruns of old movies of super big deal failures in the past.
Interesting and yet not surprising so many linked to entertainment industry where egos are bigger than maths and finance skills.
Totally agree. The real winner here is Nerflix.
https://defytheodds88.substack.com/p/the-hated-giant-one-stock-the-intermarket
I don't know why we are confused, surprised or concerned when we live in a time of unfettered capitalism. This has been growing since the early 80's (at least.)
The collective "we" does not care enough to put an end to it and it will continue till it crashes.
One day people will accept that buying Warner is not a good business plan. How many companies need to implode before this becomes common knowledge?
The last time Warner was bought and the post-acquisition company did well was when? When it was acquired by the funeral home and parking lot people?
That was the analysis of this mergers and acquisitions I was waiting for!
This is fantastic Scott. Big fan our yours, thanks so much for all you do. Please do a speaking tour around the UK, or even just more content on M&A as selfishly I'm involved in the space and love reading or hearing your perspectives on it.
Coming over to the Stack, eh? Welcome.
The edibles were kicking in there at the end.
Have you guys relocated?
Calling it the worst acquisition in History is a little dramatic. Give it a couple of years to see if the new leadership team can turn this thing around.
Our dream 10 years ago was to be able to jump online (without having to align with a specific outlet) and watch any "movie" that you wanted too without a cost (or very small fee). Now consumers have to pay for 4-8 different platforms just to get frustrated in trying to find a specific show or content.
IMO, what Disney and Netflix does is market what THEY want the audience to watch and make it very difficult in some cases to search and find something that is actually worth the time to consume. The algorithms they use drive to push content is a whole other issue.
Amazon and YouTube have a different approach by increasing the "inventory of shows, movies, short content" and make it easier for consumers to find what they want. Better experience. I may have to pay a little extra but it is worth it.
By the way....Oracle knows a little something about housing large content for companies. Maybe this new group may actually open up that huge library and let consumer watch what they want.
The reason you can't watch what you want, when you want, where you want, isn't the technology. Those problems were solved a decade ago and nothing Oracle is bringing to the table will change that. The problem is IP licensing. The company that owns the distribution rights in market / region A is not the company that owns the rights in market / region B (or C or D or E). And the company that owns the theatrical release rights (ie cinemas) might not be the company that owns the TV rights, or the streaming rights, or the DVD/physical media rights. Multiple that by literally millions of movies and TV shows produced over a century of filmed entertainment, where the rights holders have gone bankrupt, been acquired, merged, spun-off or literally died and you have a Gordian knot of complexity that media orgs have been trying to deal with for years, at the cost of millions, and they still regularly get sued for failing to pay royalties to the right people and/or doing deals around IP that it turns out they don't actually own the rights for, or at least the *right* rights.
Quite literally, the only way to watch what you want, when you want, where you want, is via online piracy. Isn't it ironic, don't you think?
It’s hard to stay patient when history shows that WB’s massive debt usually drowns even the best intentions.
That said, you make a fair point about the Oracle connection…if the Larry Ellison stops chasing "prestige" and use that tech to actually fix the search and discovery mess, they might finally turn a bloated library into something people can actually use. We shall see….
Great analysis, but you're missing the point of the acquisition, for Ellison, this isn't about business, it's about gaining control of a media empire so he can push his political agenda and promote Trump.... if it was business, he would fund the purchase with his own money, not from a bunch of middle east backers and a vague token gesture of underwriting part of the debt
Thanks for this analysis. I agree with commenters that politics was at the centre of this. As such the deal was more about purchasing influence than about business, similar to Musk's purchase of Twitter.
This is the conservative playbook, and unfortunately they may have good reason to do so. If conservatives control CNN, the news on cable is even more skewed, at a time when most progressive media is retreating behind paywalls.
For the regular person sitting on their couch, this merger is basically "Subscription Exhaustion." It means your favourite shows are moving to yet another new app, the price is probably going up to pay off some billionaire’s debt, and there will likely be fewer original, risky shows because the accountants are now in charge of the "creatives." It’s the sound of the Golden Age of TV finally hitting the "End Credits."