??Curtain Call - Week 10

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Welcome to Curtain Call! ?? Your curated, weekly recap of the latest industry headlines and news across media, entertainment, and sports. The 3 things you need to know. Short, sweet, and to the point ?? But, first, for those with short attention spans, here's our weekly call sheet and a public comps trading update. Enjoy!

Your Weekly (W)Rap ??

After The Bell - Sector Trading Update ??

Market Backdrop ??:

• Uneven results: U.S. stock indexes got off to a shaky start on Monday and Tuesday but reversed course as the week progressed to remain only slightly below their recently established record highs. The NASDAQ and the Dow finished down around 1% for the week while the S&P 500 posted a fractional decline.
• Steady labor market: February’s jobs growth figure of 275k came in above most economists’ expectations for around 200k and extended a recent run of solidly positive labor market momentum. However, initial jobs gain estimates for December and January were revised downward, the unemployment rate rose to 3.9%, and wage growth slowed.
• Powell’s caution: In testimony before Congress, U.S. Federal Reserve Chair Jerome Powell reiterated the central bank's intention to cut interest rates at some point this year, provided inflation data continues to show continued easing. “We want to see a little bit more data,” Powell said during one of the week’s two congressional hearings.?
• Steady European rates: The European Central Bank kept its key interest rate unchanged at a record high as policymakers signaled that they want to see further progress in reducing inflation before cutting rates. The bank kept its deposit rate at 4% for the fourth meeting in a row.
• Yield pullback: The yield of the 10-year U.S. Treasury bond fell to its lowest level in five weeks. The yield closed around 4.08% on Friday, down from a recent closing high of 4.33% on February 22. However, the yield remained well above its year-end 2023 level of 3.88%.

This Week's Top 3 - ICYMI ??

Audio/Music/Podcast ???

• Warner Music Group joins the race to buy Believe. The company disclosed on Thursday that it has begun conversations with Believe about a possible merger. WMG said it could value Believe at €17 per share, two euros more than an offer made to take Believe private?last month?by a group that included?investment firm EQT, current investor TCV, and the music company’s founder, Denis Ladegaillerie. (WMG)
• Music royalties trading platform JKBX launches with regulatory approval from the SEC. JKBX has announced that it has received qualification from the US Securities and Exchange Commission (SEC) for its assets. The result: as of this week, investors – including consumers aka "retail investors" – can legally purchase shares in the royalty streams of hits written and/or recorded by various superstar songwriters and artists ranging from Beyoncé to Ryan Tedder, Timbaland, the Jonas Brothers, Camila Cabello, Major Lazer, OneRepublic, Ed Sheeran, Louis Bell and many more. (MBW)
• More Universal Music songs are disappearing from TikTok as the two companies fail to reach new agreements.?While songs from signed UMG artists, like Taylor Swift, Drake, and Olivia Rodrigo, were pulled from TikTok at the beginning of Feb., even more of them are disappearing now. “Universal not only had their recording deal lapse, which took down all the music that their artists perform, but also had a lapse of their publishing deal,” says Tatiana Cirisano, a music industry analyst at MIDiA Research. “This now means any song that includes lyrics or a melody created by anyone who is signed under Universal Music Publishing Group - that music also gets taken down.” To make things worse for TikTok, The National Music Publishers' Association?also said?it will not renew its licensing deal with TikTok when it expires in April. (WIRED)

Film/TV ???

• “Dune: Part Two” raked in $82.5m at the domestic box office on during its opening weekend, narrowly surpassing the opening weekend of the 2023 blockbuster film “Oppenheimer.” The film is a much-anticipated sequel to one of the most popular science fiction adaptions in recent yrs and helped revive a sleepy box office.?The sequel doubled the domestic opening of the first “Dune” installment, which opened w/ $41m. (Yahoo Finance)
• Lionsgate said it will merge its studio business, which includes its television studio and motion picture group, with Screaming Eagle Acquisition Corp. as the company splits the studio division with Starz.?With this change, Starz, the cable TV network, will be spun off into its own company and a new company, Lionsgate Studios, will be formed. (Cord Cutters News)
• Hollywood's "below-the-line" workers, including IATSE and Basic Crafts, are negotiating new film and TV contracts with studios, focusing on pension and health plans.?The process, expected to extend into the summer, is crucial, especially after contentious 2021 talks. Wages, job security, and the impact of inflation are key issues. Negotiations also aim to address the funding of pension and health plans and explore a streaming residual. Amid a possible strike climate, union leaders express readiness to strike if necessary, but both sides aim to avoid work stoppages, seeking a fair deal for members. (Deadline)

Gaming ??

• Discord will offer?rewards to gamers?as it considers an IPO. The instant-messaging app favored by video gamers, is launching a product that offers rewards for online play, part of an effort to generate a profit at the company this year. "Quests," as the product is called, let Discord users try out new games with friends and win stuff, CEO Jason Citron said in an interview. Video-game companies, including some big names, will pay Discord to offer rewards tied to their games. Discord now has over 200m MAUs, according to Citron, while revenue has 4x since 2020 to over $600m on an annualized basis, according to people with knowledge of the matter. (Bloomberg)
• Dragon Ball?creator?Akira Toriyama?passed away at the age of 68 (RIP). Toriyama's groundbreaking work has left an indelible mark on the world of manga and anime, inspiring generations with the adventures of Goku and friends. Toriyama's legacy will continue to live on through his iconic characters and the countless lives he's touched with his art. (NBC News)
• Rooster Teeth is shutting down after 21 years. The closure of Rooster Teeth will result in layoffs of its approximately 150 full-time employees and will throw dozens of contractors and content creators out of work as well. Warner Bros. Discovery is currently in talks to sell the rights to certain Rooster Teeth catalog content and IP such as the popular anime-style series “RWBY”, pioneering sci-fi spoof “Red vs. Blue,” and Michael B. Jordan’s animated mecha series “Gen:Lock.” In addition, WBD is seeking to sell the Roost podcast network, with shows spanning gaming, true crime, fandom, comedy and food, which for the time being will continue to operate. (Varitety)

Sports ??

• Bridgepoint, the long-standing owner of the Moto GP global motor-racing series is in advanced talks to sell the business for ￡3bn+. Bridgepoint, which is the biggest shareholder in Moto GP's parent company, Dorna Sports, is seeking a valuation of up to €4bn (￡3.4bn) in its negotiations with prospective buyers. One source said that Bridgepoint was trying to seal an agreement to sell Dorna within a matter of weeks. (Sky News)
• The?Dartmouth College?men’s basketball team has?voted?to unionize, becoming the first group of organized student athletes in the nation. In what could become a landmark moment for collegiate athletics, the men’s basketball team?voted 13-2 to join a?local union?following last month’s National Labor Relations Board ruling that the players were school employees. This could set the stage for other Ivy League athletes to form a collective bargaining unit to negotiate salaries and benefits, which has the potential to upend the?NCAA?and?NIL?construct and end college sports’ amateur model. (Bloomberg)
• The NFL released its international Super Bowl audience numbers, revealing a 10% increase in viewership from last year’s game.?62.5m viewers watched the Chiefs’ overtime victory over the 49ers, which also marked the game’s biggest US audience with 202.4m cumulative viewers. Total audience numbers hit 24.1m in Mexico, 18.8m in Canada, 3.8m in Germany, 3.7m in the UK, and nearly 3m in Australia. (Front Office Sports)

Social/Digital Media ??

• In more(!) TikTok news... the company is trying to rally support among its own users, as support grows for a bill in Congress that would effectively ban the company in the US.?TikTok sent users in the US a push notification warning that “Congress is planning a total ban of TikTok” that would "[strip] 170m Americans of their Constitutional right to free expression.” The page says that a ban would “damage millions of businesses", among other harms. (The Verge)
• Reddit is targeting a valuation of up to $6.5bn in its highly anticipated IPO, far less than the social-media co was worth a few year ago.?The company plans to target a price range of $31 to $34 per share, people familiar w/ the matter said. The company was valued at $10bn in its most recent private fundraising in 2021. In addition to that, Reddit's push to allow for their most loyal posters and moderators to preregister for the chance to buy shares in the company's IPO has been met with skepticism. The site’s r/WallStreetBets forum has threatened to bet against the stock, with many people noting that the company still loses money two decades into its existence. (Yahoo Finance)
• LinkedIn for the first-time disclosed sales for its premium subscription business.?The unit hit $1.7bn in rev in 2023, as it sees an uptick in adoption of new AI tools. LinkedIn has not broken out its full financial performance since it was acquired by Microsoft in 2016. The company has previously disclosed that it made $15bn in fiscal 2023, w/ $7bn of that coming from hiring software that it sells to corporate recruiters. (AOL)

Streaming ??

• Netflix has picked up the rights for what could be one of the most-watched boxing matches of the year.?Netflix will stream the fight between 57-yr-old legendary former heavyweight champion Mike Tyson and 27-yr-old influencer-turned-boxing disruptor Jake Paul that will take place on July 20th at the 80k-seat AT&T Stadium in Arlington, Texas. The event will be Netflix's third live sports event after streaming The Netflix Cup and The Netflix Slam. (Silicon Valley Business Journal)

• Fubo CEO, David Gandler, suggested that he is willing to go to the mat in its battle against the sports streaming JV formed by Disney, Fox and WBD, calling it a “duel to the death” during the company’s quarterly earnings call.?Fubo recently filed a federal antitrust lawsuit against the JV, with the forthcoming app seen by some as a threat to Fubo’s sports-focused competitive advantage. At the same time, Fox Corp.?CEO, Lachlan Murdoch, said?the new sports streaming service?to be launched later this year with?Disney and?Warner Bros. Discovery is projected to reach 5m subscribers after five years. (StreamTV Insider)
• Revenues from OTT subscription video services are expected to reach $100bn in 2029, an increase from $81bn in 2023.?Digital TV Research forecasts the US will contribute $16bn of the $19bn incremental revenues, while North American AVOD revenues will increase from $17bn in 2023 to $25bn in 2029. SVOD revenues are expected to climb by $10bn between 2023 and 2029 to $67bn. (Broadband TV News)

Artificial Intelligence ??

• Google co-founder Sergey Brin, in a rare public appearance over the weekend, told a group of artificial intelligence enthusiasts that "he came out of retirement because the trajectory of AI is so exciting."?In taking questions from the crowd, Brin discussed AI's impact on search and how Google can maintain its leadership position in its core market as AI continues to grow. (CNBC)
• Meta's hefty investment in AI includes development of an AI system designed to power Facebook's entire video recommendation engine across all its platforms, per Tom Alison, the head of Facebook.?Alison said part of Meta's "technology roadmap that goes to 2026" involves developing an AI recommendation model that can power both the company's TikTok-like Reels short video services and more traditional, longer videos. (CNBC)
• US officials have told Advanced Micro Devices that the AI chip it tailored for the Chinese market is too powerful to sell w/o a license, ensnaring another American semiconductor co in Washington’s crackdown on exports of advanced technologies.?The US has been working to limit Chinese access to cutting-edge semiconductors that can develop AI models — and the tools used to manufacture those chips — out of fear that Beijing will gain a military edge. (Yahoo Finance)

That's a wrap! Let me know what you think of this latest format and/or if you have any suggestions of things that would be interesting to see/add.

?? In The Meantime…

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Disclaimer

This post and the information presented are intended for informational purposes only.?The views expressed herein are the author’s alone and do not constitute an offer to sell, or a recommendation to purchase, or a solicitation of an offer to buy, any security, nor a recommendation for any investment product or service. The information provided is believed to be from reliable sources but no liability is accepted for any inaccuracies.? This is for information purposes and should not be construed as an investment recommendation.?Sources used in this post include Bloomberg, CapIQ, Pitchbook, and company filings.