ESPN's upfront features pitches to younger tastes: avocado toast and social media

ESPN's upfront presentation at New York's Minskoff Theater featured trays of avocado toast, salmon bagels and green juice smoothies - evidence that Disney is in touch with younger tastes and that this is a company that can still afford to pay for luxuries when it comes to wooing advertisers.

As the crowd of ad executives waited in the theater for ESPN's new president Jimmy Pitaro to make his debut on a stage, a DJ, aptly named Dilemma, provided the bass-heavy music to generate some excitement.

ESPN's dilemma, of course, is two-fold:

1) How to grow its direct-to-consumer business fast enough to compete for sports rights with tech rivals that have cash piles in the multi-billions.

2) How to encourage cable customers to stump for new services without them cutting the cord. Disney cable income is on the decline, according to its most recent earnings report.

About that new subscription service: in a post-show press conference, Pitaro declined to offer any numbers on the re-launched ESPN app, which hosts ESPN+. He did say that both engagement and reach are up, and that he's pleased with the conversion rates to the new service.

ESPN opened its upfront with the three stars of its new morning show, "Get Up" in a video on their way to work. The show has been seen as a major new effort for ESPN, but ratings haven't been great. Reporters at the post-event press conference wanted Pitaro's take: He said change is hard and that ratings are up since the network has been tweaking the show.

How's Pitaro's vision is different from predecessor John Skipper: Pitaro says he's been thinking a lot about ESPN's audience and that the company can't get too caught up in the idea of a "fanatic."

"I think we're doing a fantastic job of serving the sports fanatic. But as we think about expanding our audience, what about the casual sports customer" Pitaro said. 

Best quote of the event: Kobe Bryant was on stage to promote his new ESPN+ show "Detail." Bryant said: "Determination wins games, details win championships."

Pitaro's top priority in two words: Audience expansion. "How do we become more relevant to more people, especially the younger generation?" Pitaro told reporters. 

The press conference ended quickly as organizers were told to break down the set so the Minskoff Theater could get ready for another Disney production: "The Lion King."

Avocado toast at the ESPN upfront. Claire Atkinson

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Netflix: the Albanian army that took over the world

Netflix (for a little while) became the biggest pure-play media company in the world when measured by Wall Street sentiment — market capitalization.

For the first time, Netflix on Thursday jumped past Disney after yesterday surpassing Comcast. The company is now worth more than double Time Warner, whose chief executive Jeff Bewkes once referred to Netflix in 2010 as the Albanian army

Just four years ago, Netflix was boasting it had $300 million to spend on content and would make five new shows a year.

"The goal is to become HBO faster than HBO becomes us," said Netflix content chief Ted Sarandos back in 2013. Now, it has $8 billion to spend on content and is making 80 movies and TV shows a year.

Management teams from rival media companies have long scratched their heads given the injustice in it all. Netflix doesn't have to prove its shows are watched. All Netflix has to do is keep signing subscribers.

But even Netflix, which has proved naysayers wrong, doesn't want to be judged on that metric forever, because sooner or later you run out of growth (or maybe you don't). Wall Street believes there's a wholesale change in the way people watch TV, even while for many of us Netflix is simply an add-on.

Netflix's market cap ended Thursday at an astounding $160.94 billion, according to Google Finance. Bloomberg had Netflix closing slightly lower at $151.8 million, dropping it back below Disney for the day. 

Netflix's momentum is also a factor. The list of talent getting checks from Sarandos gets longer by the day and now includes even a former president as one of its creatives.

Bloomberg media analyst Paul Sweeney, who's been watching the sector forever, observes that Netflix is trying to get the street to judge it instead on profitability without much luck. As long as things keep chugging along then maybe Netflix is a future buyer of Disney, not the other way around.

Stranger Things have happened.

Major media company market caps as of Thursday afternoon:

Netflix: $160.94 billion

Disney: $152.20 billion

Comcast: $143.17 billion

Time Warner: $73.74 billion

Twenty-First Century Fox: $73.59 billion.



Michelle Obama teases new book with a look at the cover

The Obamas are flooding the zone right now.

On Monday, Netflix announced a wide ranging multi-year deal with Barack and Michelle Obama, which could include scripted and unscripted series.

Now comes a teaser for the former first lady's upcoming book. Michelle Obama posted the cover on her Instagram account on Thursday, showing her in an off the shoulder white top coupled with a huge smile.

The book is called "Becoming Michelle" and encourages readers to fulfill their own potential, as she did, moving from Chicago's South Side to become one of the most recognizable and well-liked people in the U.S.

The photo already has 687,000 likes as of Thursday afternoon. The 400-page book, from Crown Publishing, comes out November 12, just after the mid-term elections. 

Disney's Hulu board member Bruce Rosenblum is leaving

There are only so many chairs. Disney's internal reorganization has claimed its first high-profile internal head.

Who's out? Disney Media Networks co-chair Ben Sherwood told staff in a memo obtained by NBC News that Bruce Rosenblum, who joined Disney as president of business operations at Disney-ABC TV, is leaving the company. Rosenblum was once head of TV at Warner Bros.

Who's in? It seems that the creation of a new direct-to-home division run by Disney's Kevin Mayer meant that Rosenblum's role was no longer necessary, according to a source familiar with the situation who was not authorized to speak publicly. Rosenblum will also be stepping down as a board member at online video platform Hulu, with Mayer taking his spot. Mayer also takes over his ad sales purview, while Sherwood is getting responsibility for distribution deals with cable operators.

What does it mean? As the Wall Street Journal points out, Rosenblum was brought in to free Sherwood to focus on creative execution. Where Fox's well-regarded production chiefs Dana Walden and Gary Newman will end up remains a question. The two just extended their contracts another year. Of course, the big caveat here is whether Comcast's planned bid pushes Disney out of the picture.

The known unknowns... The proposed Fox/Disney merger means plenty of uncertainty for executives and well as creatives. The deal already resulted in high-powered TV producer Ryan Murphy joining Netflix.






Look out, Disney: Comcast says it's working on an all-cash bid for Fox assets

Comcast confirmed on Wednesday that it is working on a plan to challenge Disney's $52.4 billion bid for major parts of Rupert Murdoch's Twenty-First Century Fox empire.

Comcast, which owns NBCUniversal, did not detail the size of its potential offer but said it would be in cash and worth more than Disney's bid, which is in stock, Comcast said in a press release.

Fox shareholders are set to consider the Disney offer in a matter of weeks. Comcast's statement on Wednesday effectively put Fox shareholders on notice that Comcast is seriously interested in buying up Fox's entertainment assets, including its movie studio and some cable channels.

Read more here.

HBO's "Succession" party arrives just in time for real-life media intrigue

HBO revealed its latest drama series, "Succession," on Tuesday night at its New York City headquarters with an event for guests including cast member Brian Cox, CNBC's Carl Quintanilla and New York Post columnist Richard Johnson.

The ten-part series follows a family-owned media business run by an aging — but still firmly in charge — dad. But it isn't about Rupert Murdoch.

The first episode sees three of the four adult kids, two men and a woman (echoes of James, Lachlan and Liz?) maneuvering to take on the top slot at the family company, with the expectation that Dad's going to step down soon. Only he doesn't.

But, again, it's not about the Murdoch family, says HBO.

The first son is poised to take charge but he overbids for a company, and the dad, Logan Roy (note the Scottish name), tells him he's not ready. The other son is laid back and affable and has seemingly relinquished his place at the table after clashing with a senior executive. There's a family trust that Dad is trying to expand and needs his three kids to agree on. But in return, they each want a piece on the empire.

HBO chief Richard Plepler told us that we have to watch all the episodes to see the bigger picture, noting that its about all the stories of the big families who run media.

HBO's timing couldn't be better given the ownership shifts at Fox and the drama that has put CBS and Shari Redstone back in the headlines.

Consumers love streaming services, still don't love pay TV and ISPs

Netflix, Sony Playstation Vue and Amazon's gaming service Twitch earned the highest scores in this year's American Customer Satisfaction Index 2018 Telecommunications Report. The group's annual report, which shows consumer sentiment on internet, phone, and TV companies, included streaming services in its annual ranking of telecommunication services for the first time.

And they dominated. 

The three got a score of 78 and were followed closely by Apple iTunes and Microsoft Store, which each scored 77. In third place was YouTube Red, another streaming subscription service which is re-launching Tuesday as YouTube Premium. (Read Fortune's bleak assessment of its chances for success.)

Netflix rivals Amazon Prime, Hulu and Walmart's Vudu came in tied for fourth place scoring 75. The Index has CBS All Access fifth, followed by HBO Now and Starz.

American consumers are much less satisfied with their broadband providers and pay-TV services than they were last year, according to the report. The index shows a 3.1 percent decline for both categories versus last year. Internet service providers fell to a score of 62 as did the pay-TV category.

AT&T U-verse scored a 70; Verizon logged a 68; Dish Network earned a 67; Comcast Xfinity received a 57; and Frontier Communications got a 56. Comcast is the parent company of NBCUniversal.


WWE to nab $1 billion deal with Fox: report

Yet again, the rights to a major sports league come up and the owners appear to have chosen to stay with a traditional broadcaster.

The Hollywood Reporter broke news on Monday afternoon that World Wrestling Entertainment is nearing a $1 billion deal with Fox for "SmackDown." The news caused WWE's stock to jump more than 12 percent.

Several reports suggested that Facebook and Amazon were both in the running for the rights. Either Facebook and Amazon names were floated to heat up the bidding, or WWE still feels the big money and big audiences are with a traditional media company.

The billion-dollar price tag covers five years beginning in 2019, which brings the cost to approximately $200 million per year, or around $2 million per hour of programming. That's not cheap for what is essentially "scripted programming." The two-hour weekly programming block is set to move from current broadcaster USA Network, which currently airs both "Raw" and "Smackdown." "Raw" is reportedly staying with USA. USA Network is owned by NBCUniversal.

WWE and Fox each declined to comment.

Hillary Clinton urges Yale class to buy newspaper subscriptions

Who says Hillary Clinton dislikes the media?

Speaking to Yale graduates over the weekend, the former candidate for president urged the class to stop the spread of fake news and help support journalism by paying for it.

"It means calling out actual fake news when we see it and supporting brave journalists and their reporting maybe even by subscribing to a newspaper," she said.

As Michelle Wolf, the comedian who attended the White House correspondents dinner, noted, President Donald Trump's election has been a boon to most of the media business. The New York Times revenue topped $1 billion in 2017. In the final quarter of last year, it signed up 157,000 new subscribers, taking full-year subscriptions to 2.6 million. 

But while national media outlets are faring better, local newspapers have been decimated, even to the surprise of newspaper investor Warren Buffett. Here's how the Salt Lake Tribune  covered news that its owner shed one in three of its newsroom staff last week.

Royal Wedding ratings are big — and a young cellist tops iTunes

The Music...

Guess who has the No. 1 album on iTunes today? It's the 19-year-old cellist Sheku Kanneh-Mason, who shot to stardom with his incredible rendition of Schubert at the end of the Royal Wedding. Mason's album, "Inspiration," reached number one on Monday morning. 

Spotify reports that Kanneh-Mason saw a 428 percent increase in streams versus a week ago Sunday, while  "The Royal Wedding - The Official Album," has over 100,000 streams globally as of Monday morning.  Streams of "Stand by Me," by Ben E. King, jumped by a third globally versus the previous Sunday, the music streamer said.

TV Ratings...

Bigger than Prince William's. Much bigger than Dad's.

American viewers were much more interested in watching the wedding of Prince Harry to "Suits" actress Megan Markle than previous royal weddings.

Nielsen reported on Sunday that wall-to-wall weekend TV coverage of the event drew 29.2 million viewers. That's a big bump from the 22.8 million people who watched Prince William marry Kate Middleton in 2011. When their father Prince Charles, the future King, married Camilla Parker Bowles in 2005 just 3.65 million viewers tuned into coverage.

Daniel Arkin

'Solo' looks set to avoid disaster, make plenty of cash

“Star Wars” fans had a bad feeling about “Solo."

The production was reportedly troubled. The original directors, Phil Lord and Chris Miller, were fired in the middle of shooting and replaced by Hollywood vet Ron Howard. “Star Wars” die-hards began to fret that the final product would be a mess, maybe even disastrous.

But with just a few days before the movie opens, things seem to have calmed down. (You can breathe now, nerds!) The pre-release tracking suggests “Solo” will open to more than $140 million over Memorial Day weekend — not on par with the opening weekend grosses of “The Force Awakens” and “The Last Jedi,” but close to what “Rogue One” made when it dropped in 2016.

“Solo,” for what it’s worth, also had a respectable Rotten Tomatoes score as of Monday morning: 71 percent with 126 reviews counted. That’s not as awe-inspiring as the 93 percent for “The Force Awakens” or 91 percent for “The Last Jedi,” but it suggests “Solo” will at the very least take fans on a fun (if flawed) ride through the galaxy.