Keyword

Monthly C3 Ratings – Is the NPX Compare the Beginning of Another Negative Earnings Wave? - February 14, 2017
January ratings for both Broadcast and Cable were down for the month. As we thought may be the case, the lapping of Nielsen’s Expanded Audience Base (NPX) proved to negatively impact ratings. We will keep monitoring this trend closely to see if this negative wave continues through the year or if January was an anomaly. This could lead to a return of normalized low-single digits television advertising growth as tough scatter comps are anniversaried and ratings growth turns more negative...[read more]

Verizon Goes Nuclear - February 13, 2017
Since 2013, we have maintained a generally bearish view of the wireless sector for one simple reason: in a high fixed, low variable cost industry where differentiation is hard to come by, price wars are the natural state of affairs... [read more]

Telecom Pangaea: Why We’re Skeptics on Verizon for Charter - January 26, 2017
Here we go again, playing the role of wallflower at the orgy. (I suppose that’s as good a description of being an analyst as any we’ve heard)... [read more]

AT&T Pre-Announces Subscriber Metrics: Do Numbers Even Matter? - January 20, 2017
The real question around AT&T’s earnings hasn’t been what they would report for their wireless and video subscriber metrics, it has been how the market would react. Based on the initial reaction to this morning’s 8-K pre-announcing AT&T’s subscriber results, the market appears pleased.

Cable One: Man Bites Dog (or Harambe Shoots the Zookeeper) - January 18, 2017
Cable One investors have pinned their hopes on M&A. But probably not many had imagined that it would be Cable One that would be the buyer, notwithstanding management commentary (warnings?) otherwise.

It’s Time to Re-Think What You Think You Thought You Knew About Spectrum - January 17, 2017
When the government’s broadcast incentive auction began at the end of last May, expectations were sky high.

U.S. Media: 2016 Review and 2017 Outlook - December 21, 2016
As we approach the end of a really interesting year for the media sector, we thought it would be a good time to look back at some of our research and review sector performance... [read more]

Online Travel: 2016 Review and 2017 Outlook - December 20, 2016
In March of this year, we launched coverage of the Online Travel Industry with a positive sector view featuring Buys on Priceline and Expedia and a more cautious outlook on TripAdvisor (Neutral). As we approach the New Year, we thought it would be a good time to look back at some of our work in online travel, in case you missed it. Below, we revisit key themes in the sector and update our perspectives where appropriate... [read more]

U.S. Internet: A Year in Review, and Year in Preview - December 20, 2016
Little more than a year ago, we launched coverage of the Internet Advertising industry with a positive sector outlook and buys on the two pillars of the sector – Google and Facebook – and a cautious view on Twitter. In March of this year, Analyst Perry Gold added coverage of the Online Travel Agencies with a similar stance of two buys on sector leaders – Priceline and Expedia – and a cautious view of TripAdvisor...[read more]

Communications Infrastructure: 2016 Review and 2017 Outlook - December 15, 2016
As we approach the New Year, we think it is helpful to look back over the past year, and to look out over the year coming, to refresh our perspectives and revisit the research that remains most relevant... [read more]

U.S. Cable & Satellite: A Year in Review, and a Year in Preview - December 15, 2016
As we approach the New Year, it has long been our practice to look back over the past year, and to look out over the year coming, to refresh our perspectives and revisit those themes, and their associated reports, that remain most relevant... [read more]

U.S. Telecommunications: A Year in Review, and a Year in Preview - December 15, 2016
As we approach the New Year, it has long been our practice to look back over the past year, and to look out over the year coming, to refresh our perspectives and revisit those themes, and their associated reports, that remain most relevant... [read more]

Sprint and T-Mobile: Time for a Little Cold Water?-December 8, 2016
On Tuesday, SoftBank CEO Masayoshi Son met with President-elect Donald Trump. Since then, Sprint’s stock has jumped by more than 10%, presumably on the narrative that Son’s commitment to invest $50B in the U.S. over the next four years can only be seen as a quid pro quo, or at the very least, as an overture to curry favor for a new attempt to merge with T-Mobile... [read more]

AT&T and DirecTV Now: Did AT&T Really Blink? Running with Scissors (Part II) - November 29, 2016
The Market has a well-known fondness for simple narratives. In the few short hours since DirecTV released the updated pricing of its DirecTV Now service last night, the Market’s narrative has already dramatically shifted. For the past month, the narrative had been that DirecTV Now will be a “cable killer.”... [read more]

U.S. Cable Network Universe Estimates: Red Herrings and Other Valuable Misinformation - November 29, 2016
On Monday, Nielsen released its December Universe Estimates for individual cable networks under their coverage. Investors have long tried to use these Nielsen estimates as their best solution to the challenge we all have in getting actual network subscriber counts... [read more]

Monthly C3 Ratings – A Presidential Hangover or Recovery? - November 15, 2016
October ratings for both Broadcast and Cable were both largely stable from the month prior. After the spike in August related to the Summer Olympics, ratings trends were consistent for the second straight month though a big question is what effect did Presidential election have on overall TV consumption...[read more]

Musings on Level 3 and CenturyLink - October 27, 2016
“We were kind of hoping it was a typo when we first saw the headlines, but alas, that turned out to be wishful thinking…
We don’t have any details regarding what might happen between Level 3 and CenturyLink beyond what’s been broadly reported (in other words, very little) and we won’t pretend to have specific answers or conclusions. We typically don’t like to comment under these sorts of circumstances since we’re not fans of making stuff up, but given how unexpected this news is we thought it might be helpful to at least offer some initial thoughts and factors to consider... [read more]

Reading $6 Billion of Spectrum Auction Tea Leaves - October 27, 2016
We’ve gotten a lot of questions about the $1.8B deposit that showed up on Comcast’s cash flow statement when they reported earnings yesterday. That deposit confirms their eligibility to bid in the incentive spectrum auction. Fewer people, however, seem to have noticed the lack of a similar deposit from Verizon. It appears that Verizon may not be participating in the auction at any significant level. If so, that would be a surprise... [read more]

AT&T Sets the Price for DirecTV Now: Running with Scissors - October 26,2016
Running with scissors might be dangerous… but it probably won’t kill you. In a clever demonstration aimed at reassuring anti-trust regulators that the combination of AT&T and Time Warner has no such base motivation as, say, making money, AT&T announced last night that they will price their first DirecTV Now package of more than 100 “premium channels” at just $35 per subscriber per month for their single-stream base package.

U.S. Media – NFL Ratings Improving? Don’t Bet on it - October 17, 2016
Last week, we published a note discussing the potential explanations for the worrying ratings declines for the NFL this season. We believed the fall in viewership can be chalked up to a combination of several factors... [read more]

Twitter, Disney M&A – Disney Stops Tweeting - October 6, 2016
Since reporting another truly terrible quarter in July and guiding to continued, decelerating quarterly results, Twitter’s shares have soared by over 50% on the back of M&A speculation. Up until last night, media reports suggested that three large companies – Disney, Google and Salesforce – were circling Twitter in advance of a bid... [read more]

CBS Viacom Merger – Family Comes First - September 28, 2016
This morning, Reuters reported that National Amusements Inc., the Redstone led holding company and controlling shareholder of CBS and Viacom, is preparing to make opening overtures to explore a merger of the two companies. As part of the process, NAI may ask both companies to form independent board committees to explore the combination... [read more]

Monthly C3 Ratings – NBC Goes for the Gold - September 14, 2016
The Rio Olympics brought people back to their TV sets in August. NBC felt most of the benefit, but as we show later on, media peer groups were also less negatively impacted by these Olympics compared to the 2012 London Games... [read more]

Google Fiber: The Latest Numbers are In… and They Explain a Lot - September 8, 2016
By now, everyone and their brother has heard that Google has pulled back on Google Fiber. The company has reportedly released half of their Google Fiber staff, and they have called a halt to bringing Google Fiber to new markets... [read more]

Discovery – Surprise Timing On Big Deal - September 8, 2016
This morning, Discovery and AT&T announced a new long-term distribution agreement for Discovery’s content. The news removes one obvious overhang and potential negative catalyst tied to the Discovery bear-case as one of the few cable network groups that had not yet been impacted by the effects of distributor consolidation... [read more] 

Viacom – Now What? - August 19, 2016
Given the reports that suggest Viacom's Chairman and CEO Philippe Dauman is exiting his post at Viacom, the obvious questions are “What will happen now?” and “What to do with the stock here?”... [read more]

Monthly C3 Ratings – After a Strong 1H16, July Ratings Take a Step Back - August 15, 2016
After a strong first half of the year, July ratings for both Broadcast and Cable took a step backwards. C3 ratings were down mid-to-high-single digits in primetime and total day. There remains a wide spectrum of performance across our cable network portfolio groups with the jury still out on whether or not July ratings are the beginning of a new, more sinister, trend... [read more]

Brexit Implications – London Calling to the Faraway Towns - June 28, 2016
Heading into 2016, we thought that the FOREX headwinds hitting some Media and Internet stocks would start to subside over the back half of this year and could actually be a tailwind in 2017. At this point, that narrative seems pretty unlikely... [read more]

U.S. Media – May PUTs Show Mixed Improvement - June 15, 2016
Yesterday, we published monthly TV ratings trends but did not include two charts on usage as the data was not yet available. With Nielsen’s release of May PUT (people using TVs) data, we present our update... [read more]

Searching for Meaning in the DC Circuit Ruling - June 14, 2016
It had been widely expected that the U.S. Court of Appeals for the DC Circuit would broadly uphold the FCC’s reclassification of broadband as a Title II service. But we doubt if even the FCC itself had expected the victory to be so sweeping... [read more]

Monthly C3 Ratings – MAY-be a Turning Point? - June 14, 2016
In May, C3 ratings were down low to mid-single digits in primetime and total day. Both Broadcast and Cable ratings trends improved from April. We believe that part of the improvement has been driven by Nielsen’s expanded sample which should continue to help for the remainder of the calendar year... [read more]

Sprint: There’s No Such Thing as Free Lunch - June 8, 2016
The recent rebound in Sprint’s stock price suggests that investor sentiment has shifted, at least to a degree, with additional borrowing having largely put to rest questions surrounding near-term solvency... [read more]

Viacom – What Took So Long? - May 31, 2016
In our view, the circus at Viacom was put into motion more than ten years ago by the ill-fated move to separate CBS and Viacom. The idea that the market was mistakenly valuing the old Viacom asset made zero sense to us at the time... [read more]

Monthly C3 Ratings – Broadcast Showers and Cable Flowers - May 12, 2016
In April, C3 ratings were down mid-single digits in both primetime and total day. Cable ratings trends continue to steadily improve and are now flat to down low-single digits, but broadcast remains challenged down high-single, low double digits... [read more]

Priceline – Despite Sudden CEO Resignation, We Remain Bullish - April 28, 2016
Priceline today announced the immediate resignation of CEO Darren Huston following a personal relationship with an employee that was a violation of the Company’s Code of Conduct (though the employee was not under his direct supervision)... [read more]

U.S. Internet – 1Q16 Full Quarter Smith Travel Research Data Presents More Positive Picture - April 26, 2016
Smith Travel Research today released its March ADR, RevPAR, and occupancy data for all non-US regions. We thought it was worth highlighting given that OTA earnings will soon be upon us (Expedia on 4/28, Priceline on 5/4, and TripAdvisor on 5/5) and because the data paints an incrementally more positive picture that the 1Q16TD (through February) averages we presented in our 1Q16 preview. Starting with ADR, for the U.S. we see… [read more]

Viacom/DISH: Brinksmanship and the DISH Missile Crisis - April 21, 2016
Over the last 18 months, investors have singularly focused on Viacom’s affiliate renegotiation with DISH. As the bear narrative went, Viacom had a weak hand from languishing ratings and no truly “must-have” content and would face increasing pressure from distributors... [read more]

U.S. Theaters – CinemaCon 2016 Takeaways - April 15, 2016
This week at CinemaCon 2016, the annual movie exhibitors’ trade show in Las Vegas, exhibitors and studios alike were eager to celebrate 2015's record year and 2016's early success. However, as we have pointed out, after a stronger than anticipated first quarter, we are cautious on the box office compares for the rest of the year... [read more]

U.S. Internet – Facebook F8 Day 2 Clearly the Undercard (from a Wall Street perspective) - April 14, 2016
Day 2 of Facebook’s Developer Conference was clearly the more technical and less exciting (at least from an investor’s perspective) of the two lineups. The day’s keynote was particularly technical and focused mostly on Facebook’s longer-dated or “moonshot” initiatives which likely have little revenue impact near term.

U.S. Internet – Facebook F8 Day 1 Takeaways: Video and Messenger Steal the Show - April 13, 2016
While Day 1 of Facebook’s annual Developer Conference in San Francisco didn’t yield any wild surprises, on display was Facebook’s execution around two key initiatives, growing its video offering and building Messenger into a commerce platform...[read more]

Monthly C3 Ratings – A Cold February for Some Broadcasters - March 16, 2016
The latest C3 update for February continues to show high-single digit viewership declines, driven by double-digit decreases in both primetime and total day. As the industry laps last year’s massive fall, we had hoped to see improvement in broad viewership trends... [read more]

U.S. Media – Sony Vue’s Latest OTT Offering Comes Into View - March 14, 2016
Earlier today Sony announced the latest iteration of its OTT Vue offering, which is now available nationwide after a seven major market launch last year. Compared to the initial launch, the service includes Disney’s suite of networks, including ABC, and AMC Networks’ portfolio of channels...[read more]

Google Fiber: Horton Hears a Who - March 3, 2016
It has been a busy few weeks for Google Fiber, and so it was with particular anticipation that we awaited the latest numbers from the U.S. Copyright Office about subscribership... [read more]

4Q National TV Ad Wrap – Strong Trends Continuing into 2016 - February 26, 2016
It is hard to believe how strong fourth quarter national TV advertising turned out to be. It is also amazing how quickly the market ignored the surprising growth to focus on – ta da – affiliate fees. Nonetheless, we think it is important to highlight the fact that 3Q’s solid advertising results were followed up by even stronger 4Q results... [read more]

VIAB – Huis Exploring Paramount Minority Interest Sale - February 23, 2016
Viacom’s Executive Chairman and CEO Philippe Dauman announced today that the company is exploring a strategic minority equity investment in Paramount Pictures. The process in now underway with the expectation a deal could be completed by June... [read more]

Monthly C3 Ratings – It’s Cold Outside, But Ratings Starting to Heat Up - February 17, 2016
Last summer, we argued that as the calendar turned to Winter, TV ratings would improve as viewership data continued to “comp” the previous year’s outsized declines. In addition, we thought that Nielsen’s expanded database, NPX, would have a positive effect for 2016. Guess what? [read more]

CBS & Viacom: Change We Can Believe In - February 3, 2016
After the market closed, CBS announced that CEO Les Moonves would replace Sumner Redstone as Chairman. More telling, CBS’s Vice Chair Shari Redstone announced that she willingly declined her promised promotion to Non-Executive Chair at CBS to make way for CEO Moonves... [read more]

U.S. Media – If You Care About Advertising and Ratings, Read This - January 13, 2016
As everyone knows, the past few years have not been kind to the cable network advertising market. The combination of shifting ad demand and collapsing ratings worked together to reduce cable network ad growth from mid-single digits to low-single digits (with some showing negative growth)... [read more]

L.A. Trip Takeaways – Still More Questions Than Answers - December 22, 2015
Once every six months, we journey to the West Coast to sit down with a diverse set of executives across the media landscape. Our quick takeaways from our meetings are as follows... [read more]

Internet Infrastructure: 2016 Outlook - December 17, 2015
As we approach the New Year, it has long been our practice to look back over the past year, and to look out over the year coming, to refresh our perspectives and revisit those that remain most relevant... [read more]

U.S. Media: Monthly C3 Ratings – Broadcast Better But Cable Losses Continue - December 17, 2015
Tracking the weekly and monthly ratings over the course of this year has quickly become a core requirement for sell and buy-side analysts alike. At the beginning of the summer... [read more]

U.S. Telecom: 2016 Outlook - December 17, 2015
In many ways, we enter 2016 much the same way we entered 2015. As was the case at the end of last year, we enter the new year with T-Mobile looking cheap and Sprint looking expensive... [read more]

Cable & Satellite: 2016 Outlook - December 17, 2015
As we approach the New Year, it has long been our practice to look back over the past year, and to look out over the year coming, to refresh our perspectives and revisit those that remain most relevant... [read more]

U.S. Media: The Disney Conspiracy - November 30, 2015
Having covered Disney for the past decade, there is a running joke among many of our friends on both the buy and sell-side that it isn’t Thanksgiving until Disney files their annual 10-K report with the S.E.C. With only a few exceptions... [read more]

FanDuel and DraftKings: Will the Golden Goose Die? - November 18, 2015
Last week, we published a summary of national TV ad spending which showed a +1% increase for the third quarter (see Exhibit 1). This result was a material improvement over the -3% decline in the second quarter of 2015 and was +180 basis points better than our pre-quarter forecast of down -1%...[read more]

Monthly C3 Ratings – A Red October, but Not for All - November 16, 2015
Tracking the weekly and monthly ratings over the course of this year has quickly become a rite of passage for sell and buy-side analysts alike. At the beginning of the summer, we called for the normalization of ratings post the lapping of last year’s declines, but unfortunately for us and many media companies hoping for a similar outcome...[read more]

Dish Network and Sling TV... Half Empty or Half Full? - November 9, 2015
In our report this morning on Dish Network’s results, we estimated that Dish’s reported subscriber loss of 23K subscribers was comprised of a loss of approximately 47K subscribers to Dish’s traditional satellite TV business, offset by a gain of 24K to its Sling TV product.

U.S. Media – Are the Broadcasters and ESPN Too NFL Dependent? - October 30, 2015
As we look forward to another weekend sitting on our couches cheering for our home team, and more importantly, the players on our fantasy teams, we started to wonder whether networks that own NFL rights into the next decade are overly dependent on this franchise?

September C3 Ratings – Wake Me Up When September Ends - October 13, 2015
After ratings declines for the most part of the summer, we are finally starting to see ratings improvements at some of the media companies we cover. Unfortunately, in aggregate, with full September C3 ratings now available, overall viewership continues to be down in the high-single to low-double digit range... [read more]

October/3Q Sensor Tower App Data Update - October 6, 2015
Following our September Internet launch in which we highlighted Sensor Tower app data, we provide both a monthly and quarterly update which will serve as the first in an ongoing series... [read more]

Twitter CEO Search Comes to a Conclusion - October 5, 2015
This morning, Twitter released an 8-K officially announcing the appointment of Jack Dorsey to the role of Chief Executive Officer. Dorsey, Co-Founder of Twitter, had served as the interim CEO of Twitter following the departure of former CEO Richard Costolo in June... [read more]

U.S. Media – Never Let a Good Crisis Go to Waste - September 21, 2015
After the August media meltdown, we argued that media executives and their shareholders should start to rethink the playbook that has delivered us to this point. For starters, we have argued that executives should take the earnings hit and stop licensing content to Netflix...[read more]

Cablevision by the Numbers - September 17, 2015
We’ve been wrong before… but rarely this wrong. By our estimates, on a stand-alone basis Cablevision has a warranted valuation in the range of $8 per share.

August C3 Ratings – Ratings Starting to Turn for Some, but Can It Last? - September 16, 2015
After ratings declines for the most part of the summer, we are finally starting to see ratings improvement at some of the media companies we cover. Unfortunately, in aggregate, with full August C3 ratings now available, overall viewership remains down in the high-single digit range, a troubling sign of what’s to come... [read more]

U.S. Media: What Do We Think? - August 28, 2015
When the markets closed on Tuesday August 25th, three weeks to the night of the fateful Disney F3Q 2015 earnings call which started the media meltdown, we noticed a really strange pattern. While the S&P 500 had melted down -11% from a close of nearly 2,100 to 1,867 due to concerns about a global economic slowdown, it was amazing to see that almost every single media stock’s multiple had fallen by almost the same exact amount, between -16% and -21%... [read more]

Telecom Yields: Once in a Blue Moon - August 27, 2015
For five years, from the fourth quarter of 2008 to the fourth quarter of 2013, the large cap TelCos traded as almost perfect bond surrogates. The correlation was extraordinary; virtually all of their residual performance relative to the broader market, whether positive or negative, could be explained by Treasury returns... [read more]

July C3 Ratings – Still Waiting for the Turn - August 11, 2015
If you are readers of our research then you should know by now that we have long called for the normalization of ratings as we comp over last year’s summer declines. Unfortunately for us and many media companies hoping for a similar outcome, with full July C3 ratings now available, we are still left waiting for the turn in ratings to materialize... [read more]

2Q National TV Ad Wrap – What Did We Learn? - August 6, 2015
Heading into this earnings season, we warned a few weeks back that 2Q national advertising revenues would be down -2% to -3% as a combination of soft scatter markets, lower upfront inflation and weak cable network ratings would blend together into an unattractive stew... [read more]

OTT – There’s An App For That - July 31, 2015
As we get ready for the core group of media earnings next week, we expect investors will be looking for early glimpses of success for many newly launched OTT products including HBO Now (TWX), Sling TV (Dish) and Noggin (VIAB) that have been launched over the first half of this year... [read more]

Affiliate Negotiation Armageddon Avoided For Now - July 27, 2015
The very public spat between Comcast and Discovery Communications was presumably going to end badly for Discovery as Comcast’s management was going to exact retribution for Discovery’s objection to the now failed Comcast-Time Warner Cable merger... [read more]

Viacom – Does Sum-of-the-Parts Provide a Valuation Backstop? - July 22, 2015
Now that Viacom has crossed the $60 per share threshold, we find ourselves asking how much more downside can there be from here? No snarky responses, please... [read more]

June PUTs – See You in September? - July 14, 2015
Ever since C3 ratings took a tumble last summer, we have been focused on the monthly changes in PUT levels which represent the percent of People Using TV. As we have wrote about previously, PUTs last summer took a dramatic step down on what, in our view, were a confluence of reasons... [read more]

High Fiber: Suddenly, It’s 2005 All Over Again - July 7, 2015
Sometime this week or next, AT&T will finally get approval for its acquisition of DirecTV and we’ll finally get to see what commitments they’ve made to get the deal across the finish line. But we already know the biggest and most important. Buried in their latest public interest filing was a commitment to bring their fiber-to-the-home (FTTH) GigaPower footprint to a total of 11.7 million homes.

U.S. Wireless: The Race to the Bottom? - June 22, 2015
Telecom investors obsess over pricing for good reason. In high fixed-cost businesses like telecom, pricing is the very essence of strategy. And pricing is also the ultimate barometer of industry health.

Sprint: Wireless Dog Whistle for Sale (Best Offer Accepted) - June 9, 2015
A little over a year ago, T-Mobile’s John Legere succinctly summed up Sprint by calling it “a pile of spectrum waiting to happen.” A year later, we’re still waiting. The question of what will, or can, Sprint do with its trove of 2.5 GHz spectrum has taken on a new sense of urgency.

Dish and T-Mobile: Really? - June 5, 2015
The idea that Dish Network and T-Mobile are talking about a combination shouldn’t come as a surprise. Both companies have shamelessly and repeatedly expressed their mutual admiration in recent months. But you’ll forgive us if we’re a bit skeptical... [read more]

As Clear as Mud Part III - May 26, 2015
Our Clear as Mud series has tracked the gyrations of the cable consolidation story, each time concluding that every step towards clarity has been met with two steps back… and a slip into the mud... [read more]

Clear as Mud Part II - May 20, 2015
As if things weren't muddy enough already. Altice's decision to buy Suddenlink (at an insupportably high price) creates even more uncertainty in an industry where virtually every element of the story is now in flux.

MoffettNathanson 2015 Media Summit Takeaways: The Times They Are A-Changin’ - May 20, 2105
With CBS’ Late Show with David Letterman wrapping up its run, we hoped that Bob Dylan – the show’s last musical guest – would sing “The Times They Are A-Changin’.” It’s a perfect song to describe the current state of U.S. media... [read more]

Verizon and AOL: Zigging While AT&T Zags - May 12, 2015
The contrast between Verizon and AT&T couldn't be more stark. AT&T is investing $47 billion in old-line video delivery with DirecTV just as the Pay TV sector is beginning to roll over. Verizon is investing $4.4 billion to, as Wayne Gretzky famously put it, “skate where the puck is going to be.”

1Q National TV Ad Wrap – We Have Some Good News … and Some Bad News. - May 11, 2015
With first quarter results now in the books, it’s time we exhale post earnings and assess the state of the U.S. national TV market. Following a year in which the TV ad market deeply disappointed initial expectations, 1Q results actually came in a bit better than first feared. However... [read more]

Verizon FiOS – Send Lawyers, Guns & Money – Part 2 - April 27, 2015
This morning, ESPN filed suit against Verizon claiming that its new “Custom TV” offer was an illegal “unilateral change” to an existing distribution agreement... [read more]

U.S. Cable: It’s as Clear as Mud Now - April 23, 2015
No, the Comcast deal isn't dead yet. But it's a bit like an elephant that has been dropped out of an airplane. At around 10,000 feet, it is technically still alive... [read more]

The Spectrum Valuation Dilemma - April 14, 2015
There is perhaps no single valuation challenge in Telecom as vexing as that for spectrum. The valuations of Dish Network, Sprint, and indeed of all the wireless carriers, hinge to varying degrees on one’s assessment of spectrum asset values... [read more]

The Cable Landscape Shifts… Again - April 1, 2015
It has now been nearly two years since Charter CEO Tom Rutledge first articulated his “two camps” vision... [read more]

Apple TV, HBO, and the Unbundling of the Bundle - March 17, 2015
We’re all going to hear the word “unbundling” a lot over the next few days. But what, exactly, are we unbundling?... [read more]

February Ratings – Not Lapping The Competition Like An Olympian - March 13, 2015
February ratings bring another month of double-digit declines, although this time with a notable comparability issue. Last year, the Winter Olympics in Sochi opened on February 7 and closed on February 23, so basically it aired most of the month... [read more]

4Q National TV Ad Wrap – Reality Sets In - February 27, 2015
Around this time last year, despite a weaker than expected 4Q 2013, there was little widespread concern over the state of the national TV ad market. Some folks blamed 4Q 2013 on fears over the government shutdown... [read more]

AT&T’s Balancing Act - January 28, 2015
Perhaps the most significant part of last night's AT&T earnings conference call was the company's discussion of their balance sheet... [read more]

Just Add Units! A Look At 4Q Spot Counts - January 28, 2015
Ahead of media earnings season, we want to remind investors that there are three drivers of advertising revenues. While the market always seems to focus on changes in ratings and asks about pricing, we often ignore inventory management... [read more]

Google Wireless: All the Rides Are Free - January 22, 2015
Imagine how much more Disney World could charge for admission if all the flights to Orlando were free? News yesterday that Google is planning to resell wireless service from Sprint and T-Mobile... [read more]

Of Tightropes and Pendulums - January 8, 2015
Yesterday, FCC Chairman Tom Wheeler all but confirmed what by now everyone and their brother already knew: the FCC will issue Open Internet Rules in February that reclassify broadband as a Title II service. And that was only the second biggest piece of news out of Washington yesterday... [read more]

DISH’s OTT Offering: Ladies and Gentleman, Please Start Your Worrying! - January 6, 2015
Dish Network’s CES press release announcing its long-awaited OTT offering has officially kicked off the New Year, and in more ways than one. Ladies and gentlemen, please start worrying about OTT threats and Pay-TV subscriber losses... [read more]

The Next Wave Takeaways - December 10, 2014
In Mid-November, we hosted our inaugural MoffettNathanson Next Wave Summit. The Summit brought together some of the most innovative and disruptive companies in digital media... [read more]

Auction Tea Leaves - November 20, 2014
In the lead-up to the FCC’s AWS-3 auction we had argued that the prices paid for the spectrum would likely come in at the low end of forecasts. There were only two “real” bidders, we argued; sure, AT&T and Verizon would each compete aggressively for 20 MHz each... [read more]

Broadcast Ratings: The Mendoza Line Update - November 19, 2014
CBS’s decision last Friday night to cancel The Millers, a second year comedy that was owned by CBS TV Studios brought us back to one of our favorite analyses – the Mendoza Line...[read more]

3Q Ad Wrap – A Sign of More Trouble Ahead - November 10, 2014
After listening to a busy week of third quarter media earnings calls, we were surprised by the honest tone of management teams on the bleak state of national advertising trends. While there were a range of explanations provided including advertisers looking for more flexibility... [read more]

FCC Alphabet Soup: Another Brick in the Wall - October 29, 2014
Yesterday, the Media Bureau (MB) of the Federal Communication Commission (FCC) circulated a Notice of Proposed Rulemaking (NPRM) to classify online video distributors (OVDs) as Multichannel Video Programming Distributors (MVPDs)...[read more]

Comcast, Title II, HBO, and the Grand Bargain - October 15, 2014
One need only glance at the recent stock action in the shares of Comcast and Time Warner Cable to surmise the obvious: the winds in Washington are blowing the wrong way. Anyone who pretends they can precisely peg the odds of avoiding Title II reclassification...[read more]

NBA – Nothing Beats Alternatives - October 7, 2014
While we were not surprised that ESPN and Turner retained their incumbent NBA position with a new nine-year TV rights deal, the ultimate price tag, despite an era of massive sports rights inflation, was startling. Somewhere, Steve Ballmer is screaming...[read more]

U.S. Media – The Other Side of the Netflix Coin - October 3, 2014
There was a time, circa 2010, when media executives were fearful of selling content of any form to Netflix as memories of digital disintermediation in both music and print were still fresh. However, money talks, especially in Hollywood...[read more]

Scratching Head, Hidden Motive? - October 1, 2014
Despite talking with many industry contacts, we are left with many questions on the announcement that Netflix and Imax will partner with The Weinstein Company to exclusively release...[read more]

Low Attendance = Low Ad Spend - September 19, 2014
We all know by now that the box office took a dramatic turn for the worse this past summer. We also know that advertising trends have been weaker throughout the summer...[read more]

August C3 Ratings – See You in September? - September 16, 2014
We have long believed that investors should wait until C3 ratings are in to pass judgment on any one network. We have also preached that it’s probably more reasonable to not focus on any individual month as compares can...[read more]

Media Companies Are Ready for Some Football - September 5, 2014
Welcome back NFL! Not only has there been a collective sigh of relief from fans and fantasy league participants but maybe even more so from the media executives who look to the NFL to help stabilize rating trends...[read more]

Title II: The Message of the Markets... Reminiscences of the Summer of 2010 - August 25, 2014
Cable investors are naturally skittish about whether the FCC will or will not move to reclassify broadband as a Title II service. While reclassification isn’t “probable,” neither can the risk be described as “remote.”...[read more]

Sprint: Goodbye Framily, Hello Tiered Data (and Sorry Existing Sprint Customers) - August 19, 2014
One week into his job, new Sprint CEO Marcelo Claure made good on his promise to deliver “very disruptive” price cuts by presenting tiered data plans as part of its Family Share Pack. The new plans are materially lower than Sprint’s previous pricing, but...[read more]

2Q Ad Wrap: This Was No Boating Accident - August 8, 2014
Listening to second quarter media earnings calls, one of the main themes (aside from all the M&A chatter) was the weakness in national advertising trends. A soft scatter market in June was blamed for the soft patch. In addition...[read more]

FOXA/TWX: We Have Our Doubts – Part II - August 5, 2014
Due to a combination of stronger than anticipated resistance from Time Warner’s Board and the adverse reaction from 21st Century Fox shareholders...[read more]

When in Doubt, REIT - July 29, 2014
Are we witnessing the REITification of telecom? This morning, Windstream announced plans to spin-off its copper, fiber, and other fixed real estate assets into a separate publicly traded real estate investment trust (REIT)...[read more]

U.S. Media: The Media M&A Merry Go ‘Round Begins - July 16, 2014
Having watched Cable and Telecom go through a full year of M&A speculation and, ultimately consolidation, it is now the media's sector turn. The idea of consolidation should come as no surprise...[read more]

The Bundling Fallacy - June 16, 2014
When AT&T had to sell investors on the logic of its DirecTV bid, it cited the power of the bundle, specifically stating that “U.S. consumers prefer to purchase pay TV service in a bundle with broadband connections and access video programming...[read more]

AT&T: The Art of Cutting by Not Raising - June 3, 2014
Earlier today, AT&T sharply cut its earnings guidance. Sort of. What you read in the press won’t mention cutting anything at all. After all, when AT&T released an update on Q2 trends this morning, they actually raised revenue...[read more]

Google Shows its Stripes - May 27, 2014
Is Google an Internet content company or is it a broadband ISP? The answer is… yes. Or, I mean, it’s both. Or at least it’s a little of both. But it’s also a backbone network operator. And it is sort of a CDN… for itself. OK, how about it’s sometimes...[read more]

AT&T and DirecTV: What, Me Worry? - May 23, 2014
The market has largely assumed that AT&T’s proposed acquisition of DirecTV will sail through the regulatory process without any real hiccups. We have more or less concurred. But is this too optimistic a reading? [read more]

AT&T, DirecTV, and Dish Network: The Life Boat - May 13, 2014
Like skid row junkies in the final wretched tremens of downward spiral, telecom/cable/satellite investors now appear to need a deal fix almost daily to stave off the messy crisis of incontinence that comes with the inevitable withdrawal. Never mind the fundamentals…[read more]

Sky Global: Rising Like A Phoenix - May 12, 2014
This morning, BSkyB confirmed that they initiated preliminary discussions to evaluate the acquisition of 21st Century Fox’s 57% stake in Sky Deutschland and full ownership of Sky Italia. The conversations are still at a preliminary level but BSkyB stated...[read more]

1Q National TV Advertising: Was It as Bad as It Felt? - May 12, 2014
If you listened to first quarter media earnings calls, it was easy to come away with the distinct belief that the scatter market was soft. If you looked at actual ad results vs. our prior forecasts, the fact that seven of the eleven advertising line...[read more]

AT&T and DirecTV: Strategy by Process of Elimination - May 1, 2014
Reports that AT&T has reached out to DirecTV are the latest spectacle in the freak show circus of TMT let’s-make-a-deal. It’s hard not to view this as strategy by process of elimination – first Vodafone, then Dish, now DirecTV – rather than strategy... [read more]

HBO & Amazon: Man Bites Dog and Other Headlines You Never See - April 23, 2014
Talk about an unexpected announcement! The headline this morning: “Amazon and HBO Ink Exclusive Multi-Year Deal to Bring Award-Winning HBO Programming to Prime Members” came out of left field for us and most people...[read more]

AT&T and Cable: GigaWar or GigaSkirmish? - April 22, 2014
Yesterday, AT&T announced that it is considering expanding its U-Verse with GigaPower service to a host of metropolitan areas, bringing the total number of markets it is currently serving, planning to serve, or considering serving to 25...[read more]

AT&T, Cable, and Google Fiber: Spending Other People’s Money - April 10, 2014
We’re guessing that Google is pleased. This morning, The Wall Street Journal reported that AT&T is in advanced negotiations to bring its U-Verse with GigaPower FTTH service to six cities in North Carolina: Carrboro, Cary, Chapel Hill, Durham, Raleigh, and Winston-Salem...[read more]

U.S. Wireless: The Next Shoe Drops - April 7, 2014
Little by little, the U.S. Wireless industry is dismantling the barriers to churn. All three mechanisms that had served the industry so well in binding customers to their carriers for the past decade – the handset subsidy model...[read more]

Telecom Estimates Still Haven’t Come All the Way Back to Reality - April 3, 2014
The Law of Conservation of Mass states that matter can be neither created nor destroyed, only transferred. Yesterday, we got a look at the latest consensus estimates for wireless subscriber growth (courtesy of T-Mobile’s quarterly survey of sell-side estimates)...[read more]

Dish, DirecTV, and AT&T: M&A Connect-the-Dots - March 27, 2014
Yesterday, in the wake of reports that Charlie Ergen had approached DirecTV CEO Mike White about a merger, we wrote that “the odds of successfully completing a merger must be deemed relatively low”...[read more]

Dish and DirecTV: Know What You're Up Against - March 26, 2014
Shares in both DirecTV and Dish Network are sharply higher today on news that Dish Chairman Charlie Ergen approached DirecTV CEO Mike White about a merger in February. It’s not hard to see why the two would be interested in a deal...[read more]

Shock, Apathy, and Virtual MSOs: Why Isn’t Anyone Acting Worried? - March 10, 2014
There was a time when the mere mention of video-over-the-Internet would send cable stocks spiraling downward. Markets quaked when Apple announced they would put individual episodes of ABC’s “Desperate Housewives”...[read more]

Disney and Dish: Sports Content Still King - March 4, 2014
After many months of negotiations (and years of litigation), The Walt Disney Company and Dish Network signed a “groundbreaking, long-term, wide-ranging” agreement that is bigger and broader than what was expected.

Comcast and Netflix: Man Bites Dog - February 24, 2014
Read almost any of the press reports about Comcast's traffic exchange deal with Netflix and you would think that Netflix had crumbled and capitulated before King Comcast, sheepishly agreeing to pay for what previously had been a free...[read more]

Google Fiber Expansion: How Big? - February 19, 2014
Talk about a one-two punch. Earlier today, moments after the FCC announced that reports of Net Neutrality’s demise had been greatly exaggerated, Google announced on its blog that it was exploring expanding its Google Fiber....[read more]

Comcast and Time Warner Cable: View from the Media Side - February 13, 2014
Consolidation of distribution doesn’t help the balance of power between content and distribution. Over the past decade, and since the advent of FiOS and U-verse, content owners have clearly owned the upper hand and have driven consistent....[read more]

Sprint and T-Mobile: Smoke Signals - February 6, 2014
Yesterday came news that Sprint is close to closing the financing commitments to acquire T-Mobile, moving them one step closer to a possible deal....[read more]

U.S. Wireless: Spectrum Reality Check Part II – Show Me the Money - January 29, 2014
Last night, AT&T shocked investors with guidance that free cash flow in 2014 would be just $11B, or more than 20% below going-in consensus....[read more]

The Manhattan Project: Comcast and Charter Join Forces to Bid for TWC - January 27, 2014
The news that Comcast and Charter are close to a deal to join forces in a bid for TWC is genuinely a game-changer. First, it would remove the prospect of a white knight bid from Comcast. That’s self-evidently good news for....[read more]

Home Entertainment: Flat* Is The New Up - January 22, 2014
Home entertainment spending, which has been under pressure for almost a decade but took a step-down during the recession, has now clawed its way back to positive reported growth for its second consecutive year, according to the Digi...[read more]

Title II Déjà Vu? - January 16, 2014
It’s baaaaaaack . Are you ready for another round of reclassification roulette? In the two days since the U.S. Court of Appeals for the D.C. Circuit delivered its long anticipated ruling ( click here ) in Verizon...[read more]

AT&T’s Sponsored Data: Will Media Companies Bite? - January 10, 2014
The digital ink wasn’t even dry yet. No sooner had AT&T announced their “Sponsored Data” plan than the blogosphere blew up. Net Neutrality advocates predictably called foul. The press predicta...[read more]

U.S. Wireless: Spectrum Reality Check - January 9, 2014
Amidst the bombshells and hand grenades lobbed in the emerging wireless price war this week in Las Vegas – AT&T (boom!); Sprint (ka-blam!); T-Mobile (BOOM!); Verizon (…silence) – there was another underc...[read more]

U.S. Wireless: Grim Reality versus Wishful Consensus - December 23, 2013
The past twelve months have not been kind to telecom investors. Even the rank speculative excesses that have in recent months propelled Sprint to what we view as preposterous levels (more on that shortly) have not been enough ...[read more]

Cable M&A at the Center of the Universe - December 19, 2013
New Yorkers always think we’re at the center of the universe. Maybe this time we’re right. Sometime in the next few days, at least if press reports are to be believed, Charter will make a bid for Time Warner ...[read more]

Sprint and T-Mobile: Is the Unthinkable… Thinkable? Our Proprietary Survey Says… - December 16, 2013
On Friday, nestled in a quiet news day amidst word of a Charter bid for Time Warner Cable, a Verizon deal for Intel’s OTT “Virtual MSO” OnCue , a DirecTV deal for the NFL...[read more]

SNI & DISCA: Why Now? - December 11, 2013
After the close of the market on Tuesday night, Variety reported that Discovery Communications is mulling a bid for Scripps Networks Interactive. A few years ago, there were reports of similar advances of a no-premium, all-...[read more]

The T-Mobile Effect: AT&T Cuts Prices - December 5, 2013
This is what happens in high fixed cost industries when growth slows and consolidation is blocked. The next shoe has dropped. AT&T has cut prices. We’ve argued for some time now that the dimensio...[read more]

The Cable Consolidation Conundrum - November 22, 2013
When we met with Charter CEO Tom Rutledge last week, perhaps the most interesting take-away was his concession that he doesn’t see M&A as being primarily about synergies, but instead about “ running the companies be...[read more]

Where Might T-Mobile Go for Low Band Spectrum? - November 13, 2013
T-Mobile’s shares have been weak in the days since it announced plans to raise $1.7-1.9B in fresh equity. Aside from the obvious dilution (the new shares will add about 9-10% to shares outstanding, and about 35-38% to t...[read more]

Pandora’s Set Top Box - October 18, 2013
Earlier this week, the Wall Street Journal reported that Netflix is in talks with Comcast, Suddenlink , and “other” cable MSOs about bringing the Netflix app to cable set top boxes. We hate to play the r...[read more]

Swimming – Well, Wading, at Least – in AT&T’s Profit Pools - October 10, 2013
When we met with T-Mobile management in Seattle three weeks ago, two comments stood out. First, CEO John Legere promised that their Uncarrier 3.0 strategy would “make AT&T gasp.” If that was the goal,...[read more]

The Twilight of Bond Surrogacy? - September 9, 2013
It is no longer controversial to observe that the large cap TelCos have for the past five years traded as bond surrogates rather than as traditional equities. With that in mind, and in light of the recent spike in Verizon b...[read more]

And So it Begins… - September 6, 2013
On Monday, the U.S. Court of Appeals for the DC Circuit will hear oral arguments in Verizon v. FCC . And so will begin a regulatory dialogue that will shape the future of cable for a generation. The case is ostensi...[read more]

What Does a Harder Line DOJ Mean for a DirecTV/Dish Merger? - August 21, 2013
In Wireless, the conclusions one can draw from the Department of Justice’s filing suit to block the merger between US Airways and American Airlines are relatively straightforward; as we wrote in our piece this morning , goin...[read more]

The Race for the Virtual MSO - August 16, 2013
With all the attention that has been paid to Intel’s efforts to develop a virtual MSO , one could be forgiven for forgetting that Sony started working on its own version at around the same time. Yesterday’s news ...[read more]

Time Warner Cable and CBS: Nothing to See Here… Move Along, Move Along - August 12, 2013
Up to now, we've refrained from writing about the ongoing TWC /CBS retransmission consent dispute for one simple reason. We couldn't think of anything interesting to say about it. The press has called the bat...[read more]

What Hath AT&T Bought - July 31, 2013
Last night, Leap Wireless filed its preliminary proxy with respect to its proposed acquisition by AT&T. The section detailing the background to the merger actually contains several interesting factoids...[read more]

T-Mobile Presses its Advantage... No Money Down - July 26, 2013
Earlier this week, AT&T attributed T-Mobile's resurgence to a transitory "iPhone effect." A more likely explanation is the "T-Mobile-is-just-plain-cheaper-effect." The distinction is...[read more]

Verizon’s Looming iPhone Shortfall - July 11, 2013
Yesterday in our Telecom initiation report, we revealed details of Verizon's iPhone contract that have been hiding in plain sight for two years. Given the attention these few paragraphs have predic...[read more]

Waiting for Godot - June 24, 2013
An article in Barron’s this weekend offers a preliminary glimpse of Intel’s long-anticipated over-the-top (OTT) video service ( click here ). The service described sounds relatively conventional. “...[read more]