Sponsored Content




Intermarkets' Privacy Policy
Support


Donate to Ace of Spades HQ!



Recent Entries
Absent Friends
westminsterdogshow 2023
Ann Wilson(Empire1) 2022
Dave In Texas 2022
Jesse in D.C. 2022
OregonMuse 2022
redc1c4 2021
Tami 2021
Chavez the Hugo 2020
Ibguy 2020
Rickl 2019
Joffen 2014
AoSHQ Writers Group
A site for members of the Horde to post their stories seeking beta readers, editing help, brainstorming, and story ideas. Also to share links to potential publishing outlets, writing help sites, and videos posting tips to get published. Contact OrangeEnt for info
Cutting The Cord And Email Security
Moron Meet-Ups





















Mid-Morning Art Thread | Main | Chris Licht Out at CNN
June 07, 2023

Wednesday Morning Rant [Joe Mannix]

mannixape2.jpg

Mania

There has been an industrial mania sweeping through in recent years: streaming. It is reminiscent of the tech bubble in that there is a lot of magical thinking involved. Trees grow to the sky, there are no limits to growth, number of customers is the most important thing, companies need to get big before they can get profitable, etc. The streaming market is crowded, unprofitable and is at the beginning of a reckoning. Yet throughout, there has also been the incumbent: Netflix. The desire to create a "Netflix Killer" has been a driving force along with the generalized mania.

Which brings us to Disney, and more specifically to Hulu. Hulu was supposed to be a "Netflix Killer" and is a joint venture between Disney and Comcast. It is also fairly successful as far as streaming platforms go. It has never made the money that was expected, but it's a big name with lots of users and it outperforms Disney's "Disney+" platform. Hulu is also the subject of one of the most mind-blowingly reckless deals I have ever seen.


The broad stokes of the corporate structure and the deal itself are laid out in The Hollywood Reporter. Disney owns two-thirds of the company and Comcast owns the remaining third. Per the terms of the joint venture, at a certain date (in January of 2024), either party can demand an ownership change - but only in one direction. Comcast can demand that Disney buy Comcast's share, or Disney can demand that Comcast sell its share to Disney. Either party can demand that Disney buy out Comcast. Bizarre, and very foolish.

But not satisfied with mere foolishness, Disney engaged in outright recklessness. Apparently, the companies agreed that if a sale is compelled, they will get third-party valuation for the enterprise to determine a price. That's sensible. What's insensible is the sweetener they tossed into the deal: that no matter what, Hulu is to have a minimum total valuation of $27.5 billion. If the third-party valuation comes in below that figure, Disney will have to pay Comcast based on the $27.5 billion anyway. That means that Disney will have to cut a check for at least $9.17 billion. That is so reckless that I can barely fathom it. Disney entered into a joint venture where the entire venture can be dumped back onto Disney at the whim at either party, and then Disney put a floor price on the future buyout.

And that buyout is probably going to happen. Iger has talked about plans to merge Hulu and Disney+ in investor calls and Comcast has indicated that expects to receive a "big check" from Disney when the date rolls 'round in January. This kind of reckless deal with massive downside risk happens only in a mania because the only reason to enter into a deal like that is if you are completely certain that it is a no-lose scenario.

It turns out that the masters of the universe are not immune to mania, and the bill is going to come due for Disney just as the bloom is coming off the streaming rose.

digg this
posted by Open Blogger at 11:00 AM

| Access Comments




Recent Comments
The Central Scrutinizer: "109 Nicki Haley is off her meds. She's crazy. ..."

Romeo13: "So, your saying Trump was RIGHT to boycott this sh ..."

Dr. T: "What fresh hell is this? (COVID vaxxes contained D ..."

TheJamesMadison, searching for more with John Huston: "The Afternoon Arterton hid behind closed doors to ..."

GL: ""Once again, Fox "News" is determined to move the ..."

Thomas Bender: "Objectively, the debate was a disaster for everyon ..."

Dr.Rev. Senator Your Highness E Buzz Miller, Esq PhD MA MS: " Nicki Haley is off her meds. She's crazy. ..."

Warai-otoko : "Even funnier is I don't think Ace even bothered ma ..."

It's a theory, science demands proof: "bet Perino is a freak in the sack. == She's woun ..."

Sponge - F*ck Joe Biden: "[i]What fresh hell is this? (COVID vaxxes containe ..."

Doof: "[i]Jokes on you! I'm going to start a movement ..."

Family members won't listen to Gandalf anymore: "If the debate covered nothing of interest to the p ..."

Recent Entries
Search


Polls! Polls! Polls!
Frequently Asked Questions
The (Almost) Complete Paul Anka Integrity Kick
Top Top Tens
Greatest Hitjobs

The Ace of Spades HQ Sex-for-Money Skankathon
A D&D Guide to the Democratic Candidates
Margaret Cho: Just Not Funny
More Margaret Cho Abuse
Margaret Cho: Still Not Funny
Iraqi Prisoner Claims He Was Raped... By Woman
Wonkette Announces "Morning Zoo" Format
John Kerry's "Plan" Causes Surrender of Moqtada al-Sadr's Militia
World Muslim Leaders Apologize for Nick Berg's Beheading
Michael Moore Goes on Lunchtime Manhattan Death-Spree
Milestone: Oliver Willis Posts 400th "Fake News Article" Referencing Britney Spears
Liberal Economists Rue a "New Decade of Greed"
Artificial Insouciance: Maureen Dowd's Word Processor Revolts Against Her Numbing Imbecility
Intelligence Officials Eye Blogs for Tips
They Done Found Us Out, Cletus: Intrepid Internet Detective Figures Out Our Master Plan
Shock: Josh Marshall Almost Mentions Sarin Discovery in Iraq
Leather-Clad Biker Freaks Terrorize Australian Town
When Clinton Was President, Torture Was Cool
What Wonkette Means When She Explains What Tina Brown Means
Wonkette's Stand-Up Act
Wankette HQ Gay-Rumors Du Jour
Here's What's Bugging Me: Goose and Slider
My Own Micah Wright Style Confession of Dishonesty
Outraged "Conservatives" React to the FMA
An On-Line Impression of Dennis Miller Having Sex with a Kodiak Bear
The Story the Rightwing Media Refuses to Report!
Our Lunch with David "Glengarry Glen Ross" Mamet
The House of Love: Paul Krugman
A Michael Moore Mystery (TM)
The Dowd-O-Matic!
Liberal Consistency and Other Myths
Kepler's Laws of Liberal Media Bias
John Kerry-- The Splunge! Candidate
"Divisive" Politics & "Attacks on Patriotism" (very long)
The Donkey ("The Raven" parody)
Powered by
Movable Type 2.64