Madison and Wall: Saturday Summary
For the week ending July 14, 2023
This past week I wrote a few times about different aspects of the current state and future trajectory of the television advertising business as we’ve historically known it.
First off, on Tuesday I published an interview with Krishan Bhatia, NBCU’s President & Chief Business Officer of Global Advertising and Partnerships to highlight different ways that sellers of TV advertising can broaden what they sell, where they sell and how they sell it.
Doing this is important because the consequences for them and their direct competitors from not continuing or pushing harder in this direction is…not good, and possibly even disastrous. As I laid out the next day as SAG-ACTRA was preparing to strike, the profit margins for the TV and video entertainment industry as we’ve historically known it are permanently lower now than before the pandemic. Costs associated with streaming – and not just the content – is a big part of it, but we can more generally point to the consequences of a world where consumers have more choice and better products. It turns out that’s more expensive than the old ways.
And finally, tying these issues together, I think we are increasingly going into a world where historical definitions of media won’t matter, especially as traditional ad-supported TV’s capacity to support goals diminishes and as the largest digital platforms become better positioned to support any given goal than they are now.
Finally, one other item I didn’t get a chance to write about was news that Disney might look to sell Star India. While perhaps understandable – especially because of the disastrous choice around the last auction for IPL cricket rights where Disney secured access to linear TV rights without also securing digital rights – the whole point around investing in India was always the need for a long time horizon, and presumably this should have been contemplated at the time when Disney bought Fox’s Entertainment assets. The expected cost to compete in India was central to Rupert Murdoch’s choice to sell most of Fox although his concern then was that Facebook, Google or Amazon and not necessarily Mukesh Ambani. I chronicled some of the irony around the consequences of Meta backing away from its global sports and professional video ambitions in an extensive note while I was at GroupM in 2021, but perhaps the ultimate irony would play out if Facebook, Google or Amazon were to actually consider buying some of the assets that Disney now plans to sell, whether in India or elsewhere around the world.