ViacomCBS directly tackles the Disney+ Market with Paw Patrol: The Movie

Is ViacomCBS attempting a gentle turf war with Disney? With the new Paw Patrol movie hitting the big screen, we asked entertainment lawyer Brandon Blake to unpack the ramifications for us.

Paw Patrol will be accompanied by a marketing campaign that’s stretched into 8 figures and 1,800 TV ads. Partnerships with over 200 companies will come to fruition, be it through tie-in toys or other products, including free trials of Paramount+. And none of it is accidental. ViacomCBS is openly gunning to cut in on some of the childhood streaming market by leveraging franchises like SpongeBob, Teenage Mutant Ninja Turtles, and iCarly as well as, of course, Paw Patrol. To date, childhood is an arena heavily dominated by Disney. 

ViacomCBS has been somewhat lacking in the streaming wards to date, avoiding the game-changing revolutions we’ve seen at WarnerMedia and Disney. In fact, this marks the first time they will have a film released to streaming alongside a theatrical release this year, citing worries around the Delta variant and their young audience. The Paw Patrol campaign represents one of the largest they’ve ever distributed, too. It’s also the first time they’ve aggressively positioned Paramount+, the streaming service they fused from the CBS/Viacom merger, as part of those efforts.

It’s ambitious, at a time when consumer buy-in is not guaranteed and parental concerns about venturing out the home will be the highest they have been in ages. Unlike Marvel and other pieces, there’s a very limited audience pool for Paw Patrol and most of them are not the familial decision-makers. ViacomCBS can also only front 42 million streaming subs, in comparison to Disney’s 174 million.

Yet it’s only part of ViacomCBS’s many-pronged attempt to carve itself a latecomer’s streaming niche. We’ve seen them actively pursue organic growth as well as partnerships to echo the Amazon/MGM and Discovery/AT&T assets over the last few months, too, as well as the launch of their joint streamer, SkyShowtime, with Comcast.

Will they be able to leverage Nickelodeon’s childhood appeal to secure some of the Disney+ market? Only time will tell, but we will be watching closely.

Disney+ heads into Asian territories

We’ve looked in greater depth at the stir surrounding the Quarter 3 Disney earnings this week, but with so much news for investors to drink in, one exciting addition to the Disney+ slate could be easily overlooked. Luckily, we have Brandon Blake’s expert eye watching the entertainment business news for us. Here’s everything you need to know about this new Disney development.

Disney+ will be expanding into Taiwan, Hong Kong, and South Korea as of November 2021. The existing Japanese streaming service will also be expanded with greater general content from October. Alongside their existing presence in Thailand, Indonesia, Malaysia, Singapore, and the Indian subcontinent, as well as New Zealand, this will catapult their Asia-Pacific market share to new heights. 

What’s driving the sudden expansion? The existing Disney+ services have been incredibly well received by viewers seeking ‘diverse entertainment content’ who are ‘drawn to (their) portfolio of brands and franchises’, in the words of Luke Kang, the president for their Asia Pacific services. In hard figures, there’s been booming subscriber growth in the area. For Thailand, Disney+ has topped app store charts since its June launch. For Indonesia and Malaysia, it’s a leading SVOD service. Demand is high, and they would be foolish indeed not to leverage it. 

While we don’t have any further firm facts on the matter, we’ve been promised full details will follow soon. Disney+ currently operates in 61 countries and offers services in 21 languages globally. In addition to the North American and European markets, it also has a thriving Latin American presence and the booming Asia Pacific division to capitalize on.

While Disney was a relative latecomer to the streaming market, in its short existence Disney+ has become a dominant part of both their balance sheet and brand strategy, with the company reforming around streaming and digital formats earlier this year. Expansion into the Asian market will doubtless serve them well over time. This entertainment lawyer will be keeping a careful eye on further news for the expansion. Of course, we’ll keep you in the loop when it does.

Roku reached 55 million active users

This week we see Roku reveal that 1.5 million new active accounts have been added during the second quarter, bringing the overall total to 55.1 million active users. All the same, their balance sheet shows a slight decline in growth as we emerge into the post-pandemic landscape. Entertainment attorney Los Angeles Brandon Blake looks deeper into what these numbers could mean for future growth.

Overall net revenue for Roky topped out at $645M for Q2, with $338M of that as profit. Yet we also see player gross profit fall off badly, with a 180% year-on-year decrease and a $6.7M hole in their pockets. Streaming hours also lagged behind Q1 by 1 billion hours, although when the overall total was 17.4 billion, that’s not all that bad in context. 

The driving factors for the decline are also logical. Out-of-home entertainment has been a big focus for people in developed countries as vaccine programs lead to the easing of pandemic restrictions. A broader dip in streaming and overall TV hours is being seen across the board, and even the Roku CFO noted this. Overall, streaming hours on active accounts appear to be leveling out at 3.5 hours a day, similar to Roku’s own pre-COVID levels and suggesting a solid entrenchment in the market that should continue to deliver well.

More positively for their bottom line, monetized ad impressions have doubled year-on-year, indicative that mainstream marketing has finally noticed the potential of streamers. Roku itself also added the Quibi library to their own, rebranded as Roku Originals, and Roku seem very happy with the acquisition. With 8 shiny Emmy nominations for Roku Original shows, it’s hard to argue. Intriguingly, stats suggest that many of the users coming on board for the new content are first-time viewers, too, suggesting a broadened market appeal through the acquisition.

Overall, while there is some slackening on the pandemic boom, Roku’s balance sheet and future profile are looking strong. 

WarnerMedia and Dish finally iron out their differences

It’s only been two and a half years, but we’ve finally seen TV giant, Dish, and WarnerMedia hash out their differences over HBO. Here’s what our resident entertainment lawyer, Brandon Blake, has to say about the issue.

We’ve finally seen a joint statement issued that HBO will return to Dish, bringing HBO Max with it. This new carriage deal sees an end to a bitter dispute that has been raging since November 2018. And, in addition to the HBO and Cinemax linear channels, the company can now sell HBO Max for its subscribers, too. In fact, a discounted $12 launch offer will be in place to entice new subscribers to bite. 

What sparked the debate, however? AT&T, the parent to Dish’s competitor, DirecTV, acquired WarnerMedia, leading to accusations that they were using HBO as a ‘weapon’ against Dish. Refutations, of course, were fast to come. The carriage dispute pulled headline attention at the time, mainly due to the accusations against AT&T, but it’s hardly the first time we’ve seen Dish play hard and mean with their programmers. Yet this one blew up in their face. Alongside the loss of Spanish-language icon Univision at roughly the same time, subscribers fled Dish en masse over the quarters that followed.

Despite some bravado at the time, implying that they didn’t need HBO and saw it as a loss-leader, it’s clear it was in Dish’s best interests to settle the dispute. Especially with a multi-billion dollar deal covering 5G and mobile network services signed with AT&T just last month. While there’s no official tie between the two deals, it’s hard not to imagine that it had some bearing on the recent settlement.

Whatever the reasons, Dish customers will now be able to re-access HBO through their subscription, as well as enjoy the additional access to HBO Max offerings. 

FTC weighs in on heavyweight entertainment mergers

With two mega-media mergers on the table- WarnerMedia with Discovery and Amazon’s takeover of MGM- FTC scrutiny was a given. Today our resident entertainment lawyer, Brandon Blake, breaks down what we know about Federal approval for both deals.

Brandon Blake– The Entertainment Lawyer

Amazon.com’s proposed $8.5B deal seems to have raised some hackles with the FTC, reportedly having received a second request to review the merger. Typically, this will vastly extend the deadline faced before a ruling is made. In June, we saw Amazon strike back, asking that the FTC Chair, Lina Khan, be removed on an antitrust basis, citing conflict due to research she has conducted as well as previous advocacy stances. It’s worth noting that the FTC already has an investigation against Amazon open as an overall part of its current Big Tech probe.

In sunnier news, AT&T seems to have a smoother road ahead. Their megamerger with Discovery, as well as the selling of a 30% stake in the pay TV business to the private equity firm TPG, seems set to close faster than originally thought. The regulatory review process for the Discovery merger is set to take about a year, with no problematic aspects yet reached in the process and the deal described as ‘straightforward’. Current hopes are that the deadline suggested for security clearance will prove conservative enough to see the matter resolved faster. On top of some pure speculation about AT&T’s future partnership with DirecTV, things seem to be looking up for the group finally

While the Amazon merger seems doomed to languish under the FTC probe a little longer, should both deals go through it will undoubtedly create some new key players in the media and entertainment landscape. It will be intriguing to see how these new tech-media companies influence the industry as a whole going forward. As always, we will be there to help you understand it all.

ViacomCBS and Charter reach a new agreement on carriage deals

‘Tis the season for carriage deals. Today our resident expert entertainment lawyer, Brandon Blake, takes a look at the newly announced carriage deal between ViacomCBS and Charter, following hot on the heels of Universal’s multiple content deals this month.

Brandon Blake– Entertainment Lawyer

Cable giant Charter Communications has now unveiled a multi-year distribution agreement for ViacomCBS’ full suite of networks, including broadcast, news, sports, and entertainment networks. Despite this announcement, the financial details and precise terms have been kept under wraps. That said, we do know that it also covers licensing for ViacomCBS’ streaming services, including Noggin, BET+, Pluto TV, and, of course, Paramount +, allowing for future distribution to Charter’s Spectrum customers. Addressable media and advanced advertising are also included under the deal.

As with Universal, the going hype seems to be offering these brands’ extensive brand portfolio to a wider audience, in turn pulling in new people with a wider choice of content to enjoy. Charter has placed further emphasis on flexibility and adaptation, hoping to keep up with the broadening digital TV trends as well as stay competitive and attractive to advertisers. With the content consumption landscape changing as fast as it is, diversifying their options is probably a smart idea, as is the added flexibility this agreement should bring both entities in the business arena.

It’s certainly an abrupt volte-face to the previous renewal cycle, which predates the reunification of Viacom and CBS in late 2019. Then, we saw quite tense rhetoric from Charter and Viacom, despite their eventual agreement. It has become a feature of ViacomCBS CEO Bob Bakish’s tenure, however, to see frayed distribution relationships repaired across the board. CBS, before the merger, last had a far less contentious renewal with Charter in 2018.

While we have yet to receive full details on the deal, this will be one to watch as we go ahead into the new cycle. 

Universal Sends Films to Peacock Within 4 Months of Opening

This week, Universal Filmed Entertainment Group has announced a major development in how their film pipeline will work going forward. BLAKE & WANG P.A entertainment lawyer examines what we know.

Brandon Blake– Entertainment Lawyer

As of 2022, Universal released films will open on Peacock within four months of their theatrical opening. This is, of course, a considerable acceleration in the traditional pay-one home entertainment window, which would once have been at least 6 months. It’s not the first move like this we’ve seen, however, with Disney, Paramount, and WarnerMedia all planning early releases for their prime titles on their streaming services. 

The Universal model is a little different, however. Its 18-month pay-one window is specifically designed to allow content distribution over several platforms. Peacock takes over the first 4 months and the last 4 months. However, the intervening 10 months will allow other partners- namely Amazon Prime Video and IMDb TV- to take over. Intriguingly, HBO, their current pay-one partner, does not seem to be taking a share of the cake. The deal will include not only Universal titles, but those from Focus Features, Illumination, and DWA as well.

Offered reasons for the intriguing pipeline include reaching the broadest possible audience and maximizing profit from their vast film library. As the Universal theatrical schedule for 2022 includes anticipated titles like Jurassic World: Dominion and Illumination’s Minions: The Rise of Gru, results could be interesting. Peacock has languished a little since its launch, primarily due to the surge of focus on streaming by industry heavyweights. Despite meeting 42 million sign ups in April, that covers only 10 million paid subscriptions. It was also hoped that the planned 2020 Olympics could be used to promote the service after launch, only to have the international sporting event delayed until this Summer. Of course, this may well be the boost the service needs.

Universal has, to date, been something of a ‘pioneer’ in seeking to collapse the traditional theatrical window. We’ve already seen them controversially create a ‘premium VOD’ window a mere 30-45 days after theatrical release. Warner Bros, too, have announced their entire slate for this year will debut on day-and-date only, with immediate HBO Max access.

Will this be the future for theatrical release? It’s tough to say. One thing is for certain, however. This interesting new release pipeline will be well worth watching.

Applications now open for BFI non-English indie project fund

On the back of a reduced travel market and near-nil festival attendance for the previous year, the British Film Institute (BFI) has announced it will be channeling funds into a new one-year, ring-fenced fund to promote new non-English indie films. This represents a collaboration with industry stalwarts, including the Film Distributors Association and the UK Cinema Association. It will be administered under the existing BFI Audience Fund. Here’s what BLAKE & WANG P.A Entertainment Lawyer Los Angeles has found out for interested indie producers.

Brandon Blake– Entertainment lawyer

This one-year ring-fenced fund has open applications now, so if the project interests you, you will need to move. Applicants must show that they meet the Audience Fund’s existing objectives of widening audience choices and promoting diversity. And, of course, meeting the language criteria.

The Audience Fund has, on average, helped bring six non-English titles to life a year since it first began working in 2017. It’s no small list, either. Minari and Parasite both were birthed with BFI support, alongside Shoplifters, A Fantastic Woman, And Then We Danced, and the much-anticipated Night of the Kings.

Why now? In their own words, “In a year where international travel is limited, we’re bringing the world to audiences.” The one-year fund recognizes the hardships faced by smaller foreign-language titles, especially with distribution and the exhibition environment, during the tumult of 2020. The funding hopes to balance some of this setback and help ensure these indie projects can rebuild competitively in the sector over the next year.

If you’re an independent producer in this niche, now is the time to act to apply to the fund, so don’t hesitate. Overall, this is a worthy addition to the funding field for the industry, and BLAKE & WANG P.A will be watching with interest to see what projects it brings to life.

A low-key, but thriving, Cannes (and what it means for you)

We saw the Cannes online market hit this week, to a rather muted trading window. For the first time in many years, several key companies were missing from the project market. All the same, it’s hardly unexpected given the turbulence of the last 18 months, and there were some interesting picks up for grabs, too. BLAKE & WANG P.A Entertainment Lawyer Los Angeles reveal some of the Cannes ins-and-outs you should know in advance of the festival kicking off next week.

The survival thriller Suddenly was a hot commodity, despite being only the sophomore directorial outing for Thomas Bidegain. Add Dead for a Dollar, Pussy Island, and Daddio to your list of hot commodities to watch, as they’re sure to be winners.

The first deal of the market went to Andreas Wiseman, with the action-comedy Muscle going to German major Leonine. A juicy pre-sale in high seven figures makes this one of the biggest for Cannes in a long while, as well as one of Leonine’s most lucrative snags. It looks like a win-win all around on that one.

Overall, it’s not a bad bit of pre-festival build-up, given the current economic climate. The Cannes Film Festival itself will kick off on July 6th. This year also brings us another interesting Cannes milestone- with 5 of the 9 spots going to women, this will be a majority-female jury despite Spike Lee sitting as president. The women in question are, of course, noted French singer Mylène Farmer, French-Senegalese actor/director Mati Diop, Maggie Gyllenhaal, Mélanie Laurent, and Jessica Hausner. We’ve also seen the Cannes Classics section unveiled, including the 2001 hit, Mulholland Drive. All in all, it’s an interesting setup for the Festival itself. How will things fare for the rest of the festival? That, of course, remains to be seen- but BLAKE & WANG P.A Entertainment lawyer will keep you in the loop, of course!

Brandon Blake– Managing Partner at Blake & Wang P.A.

The Gauge reveals surprising data for studios and advertisers

Nielsen’s new monthly measurement, The Gauge, has revealed surprising- and slightly startling- data on how Americans consume their media. What does this mean for studios and advertisers, however? BLAKE & WANG P.A best entertainment lawyers in Los Angeles one of the best entertainment law firms Los Angeles  dives into the details. 

Brandon Blake– Entertainment Lawyer

For May, we see Americans consume 25% of their TV through broadcast services, 26% through streaming, and a rather startling 39% through cable. It’s no surprise that the TV landscape has been forever altered by 2020’s unprecedented events. This data, however, doesn’t quite reflect what we would have anticipated. In a world where more and more people are shifting back to their pre-pandemic habits, we’re definitely seeing a continued interest in streaming services, and people are still sampling their many options. It’s not unrealistic to say that, as TV production ramps up in turn, we’ll also see what content enters the space to give individual services traction with viewers. 

Currently, the strong favorites- Netflix and YouTube at 6%, Hulu at 3%, Amazon Prime Video at 2%, and Disney+ at 1%- are no surprise to anyone. Future patterns, however, could well change significantly.

We’re also seeing a continual branching of service. Almost every streaming channel has migrated to offering both premium and ad-supported content, regardless of which option came first. Marketers have long been complaining that Nielsen did not keep its methodology up-to-date for the streaming era, lacking visibility into how the market was divided between linear TV and streaming. Likewise, networks have complained that there was undercounting of their viewership. Hence, of course, the introduction of The Gauge to start with.

On top of this, we have the new direct-to-consumer models being so wholeheartedly embraced by Disney, NBCUniversal, and WarnerMedia. In a world where your revenue depends on ads, you need metrics to make your best decisions. When that data isn’t there, it’s an issue.

Now we have the figures. The question is, what will we do with them? BLAKE & WANG P.A top entertainment law firms Los Angeles will be watching for studio and advertiser response with interest.