(Roughly) Daily

… and, as Mark Sweney reports, that staging is undergoing a fundamental transition. Case in point: Warner Bros Discovery’s recent massive write-down of traditional broadcast assets as it struggles to play catch-up with streaming and video services…

Warner Bros Discovery’s announcement… of a $9bn (£7bn) writedown in the value of its TV networks is a stark acknowledgment of the damage the streaming wars are inflicting on traditional broadcasting models.

The astonishing figure, which pushed the US entertainment group to a quarterly net loss of $10bn (£7.9bn) and sent shares sliding 12% in early trading on Thursday, lays bare how channels such as CNN, TLC and the Food Network can no longer rely on a captive cable subscriber base.

The rapid consumer shift away from high-priced TV packages, coupled with the inexorable decline in advertising, has forced traditional TV companies to invest billions in low-cost streaming services to catch up with first movers such as Netflix.

The question is now whether companies such as WBD – home to TV and film content including Furiosa: A Mad Max Saga, Godzilla x Kong: The New Empire, The Big Bang Theory, Succession, Friends and all Olympics events – can build the scale and make significant profits from their streaming operations before the death of linear television delivered by cable, satellite or aerial…

…

… Disney has more than 200 million global streaming subscribers, and WBD exceeds 100 million globally, with Discovery+ now the fastest-growing service in the UK thanks to winning the rights to show every Olympic discipline. But the battle is not just to continue to drive scale.

Boosting revenue and profits per subscriber has become critical through strategies including rapid rounds of price increases – Disney has just announced a set of price rises for later this year – as well as driving slightly cheaper ad-funded tiers to pull in cost-conscious consumers.

While traditional TV companies struggle with managing the decline in their legacy businesses, with drastic rounds of cost-cutting after a decade of profligate spending on content in the first decade of the streaming wars, Netflix points to a viable future.

The streaming giant, which once struggled with mounting losses running into tens of billions of dollars, has seen its market value surge by more than 50% over the past year after turning the profitability corner while continuing to see significant growth in subscribers.

WBD’s chief executive, David Zaslav, who has considered breaking up the company but concluded that is not currently the best option, said the market was being hit by a “generational disruption” that requires traditional TV companies to take “bold, necessary steps”.

Richard Broughton, director at Ampere Analysis, said: “Legacy TV businesses are in decline but the shift is not so rapid that it can’t be managed. There are still a lot of broadcast TV viewers, they have the time to pivot to profitability in the streaming world.”…

Dealing with disruption: “‘Traditional TV is dying’: can networks pivot and survive?” from @marksweney in @guardian.

Corollary damage: “two venerable TV trade publications, Broadcasting & Cable and Multichannel News, will shut down“

See also: “The music industry is suffering from a streaming hangover” (gift link) and on a more upbeat note, “Radio shows surprising resilience even in a rapidly changing media world.”

For (just one example of) the kind of speculation that tectonic shifts of this sort can elicit: “Why Apple should buy Warner Bros. Discovery. No, seriously.“

And for one take on why all of this is underway: “The Addiction Economy.”

* Neil Postman, Amusing Ourselves to Death

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As we muse on media, we might spare a thought for Dominick George “Don” Pardo Jr.; he died on this date in 2014. A member of the Television Hall of Fame, Pardo had a 70-year tenure with NBC, working as the announcer for early incarnations of such notable shows as The Price Is Right, Jackpot, Jeopardy!, Three on a Match, Winning Streak, and NBC Nightly News. His longest, and best-known, announcing job was for NBC’s Saturday Night Live, a job he held for 38 seasons, from the show’s debut in 1975 until his death.