Welcome to the latest installment of Dan Rayburn's Streaming Insights & Intelligence, a weekly insights column on StreamTV Insider where the industry analyst puts facts and figures to the news you need to know about. Join the discussion on LinkedIn and check back each week as he unpacks key industry happenings.
Here’s the news Rayburn's tracking for the week of May 1, 2024: WBD channels leave Fubo; Amazon, Viacom18, Microsoft and Harmonic earnings; Max’s international push.
WBD channels leave Fubo
As of 5pm EST on April 30th, WBD channels are no longer available on Fubo as the companies could not agree to new content licensing terms. Discovery, HGTV, Food Network, and TLC, among others (19 channels in total, including foreign language variations), have all left Fubo's platform. Fubo also says it has been unable to reach a separate deal to bring Turner sports networks TNT, TBS, and truTV to its customers.
In all these cases, it’s always semantics on the exact words companies use. Fubo’s release said it "attempted to renew,” but WBD issued a statement saying Fubo could have extended the "current agreement, with no changes or price increases." So Fubo could have "renewed," but they didn't like their deal and proposed lower terms that WBD didn't agree to. I also wonder if Fubo's lawsuit filed against WBD was something they tried to use as leverage to get lower terms in a new agreement.
In all these licensing disputes, both sides want to blame the other, saying they "negotiated in good faith," but with no proposals, numbers, or terms shared, we have no idea what either side offered or asked for. Fubo says, "Warner Bros. Discovery's refusal to offer Fubo standard market terms and packaging flexibility are more examples of the unfair and anti-competitive practices," but I don't understand how there is any legal standing behind that argument. No content owner must license their content to everyone or on the same terms. I am very interested in seeing if Fubo has any legal standing when and if the lawsuit goes to court.
Amazon Q1 2024 earnings
AWS revenue of $25 billion, up 17% y/o/y; AWS's growth rate puts it on a $100 billion annual revenue run rate. Advertising revenue was $11.8 billion, up 24% YoY. Amazon expects overall capex to meaningfully increase this year, driven by higher infrastructure costs to support growth in AWS, including generative AI. Capex in Q1 was $14 billion. Amazon's CEO said AI will drive "tens of billions of dollars" of revenue in the next several years.
JioCinema’s new subscription plan
Indian on-demand video-streaming service JioCinema, has introduced a new monthly subscription plan, with the lowest tier costing just 35 cents. It allows one simultaneous stream, 4K video, no ads and allows for downloading of content. The pricing undercuts rivals Netflix and Prime Video with its new 35-cent premium tier, a fraction of their cheapest plans priced at $2.40 and $2.15, respectively, in India.
Regional sports moves
The MLB’s Pittsburgh Pirates and the NHL’s Penguins are the latest teams to offer local games on a streaming service — and outside of the pay-TV bundle — in their market. SportsNet Pittsburgh’s streaming offering will cost $17.99 a month, called SNP 360. Viewers with pay-TV subscriptions will also have access to the app. NESN manages and built the service.
Viacom18 Q1 earnings
Viacom18, the media arm of Reliance Industries Limited, posted revenue of $1.3 billion, up from $871 million YoY. EBITDA came in at $3.9 million, down from $28.3 million YoY. The company said, "Consolidated EBITDA of the group was impacted by continued investments in sports and digital verticals of Viacom18, the leading drivers of revenue growth for the foreseeable future." Viacom18 plans to merge with Disney's Star India, which is still awaiting regulatory approval.
Harmonic Q1 earnings
Total revenue was $122.1 million, down from $157.6 million YoY. GAAP net loss of $8.1 million, compared to a net gain of $5.1 million in Q1 2023. Total Video revenue was $43.2 million, down from $57.3 million YoY. SaaS video revenue accounted for $12.9 million of the total video revenue, up 11% YoY. Video revenue full-year guidance of $185-$195 million with raised EBITDA guidance.
Full-year total company revenue guidance is $645-$695 million. Q1 free cash flow was $24.9 million, and the company ended the quarter with $84.3 million in cash. In April 2024, the company redeemed $115.5M of 2024 Convertible Notes. The company has a record backlog and deferred revenue of $677.8 million.
Harmonic's first quarter results were within its guidance range, with their stock up $0.45 after hours. The year-over-year declines were expected as the company realigns its product focus and incurred costs associated with restructuring within the Video segment aimed at long-term profitability.
Key numbers from WBD’s Max rollout in Latin America
Here are some new numbers from Warner Bros. Discovery's rollout of Max in LATAM as the company prepares to launch Max in Europe beginning May 21. Numbers...
- As of April 15, 92% of existing HBO Max customers in Latin America had downloaded the new Max app and signed in, and of those migrated subscribers, 94% had already watched an asset on the app.
- Max hit record concurrent views for live sports in the U.S. during the 2024 NCAA Division I Men's Basketball Championship on April 8 and in Mexico and Brazil during the UEFA Champions League Quarter-Final on April 17. (WBD would not disclose a concurrent number)
- Max now supports 25 currencies across 39 regions and has 160 partner authentication integrations.
- Users traveling to regions where Max is not available will still be able to access their mobile downloads as well as their setting pages.
- The Max livestream capabilities now offers replays for select events within 15 minutes of the live event's conclusion. (Global support)
- Max users watching live events will now have control over the scrubbing bar while streaming on web and Android mobile devices via Chromecast. (Global support)
Microsoft earnings
Microsoft Q1 2024 Earnings (fiscal third quarter): Intelligent Cloud segment generated $26.71 billion in revenue. Revenue from Azure and other cloud services grew 31%, compared with 30% in the previous quarter. Inside of the Azure growth, seven percentage points were related to AI, up from six points of impact in the previous quarter thanks to customers like ChatGPT. The company said it needs more data center infrastructure, specifically for deploying artificial intelligence models and noted that AI demand could outstrip available capacity in the near term.
Dan Rayburn is an analyst in the streaming media industry, with regular TV appearances on CNBC, Bloomberg TV, and Schwab Network amongst others. He is conference Chairman for the NAB Show Streaming Summit in Las Vegas each year, and his streamingmediablog.com website is one of the most widely read sites for broadcasters, content owners, OTT providers, Wall Street money managers, and industry executives. He also has a podcast at danrayburnpodcast.com. He can be reached at [email protected]
Dan Rayburn’s Streaming Analysis & Insights is an opinion column. It does not necessarily represent the opinions of StreamTV Insider.
Article updated to reflect 19 WBD channels left Fubo. An earlier version said 18.