1 big thing: From Tom Cruise deepfakes to de-aging Tom Hanks

Photo illustration of  Metaphysic CEO and cofounder Tom Graham with a digital eye and lines in the background.

2. The BFD: Meta's VR win

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3. Peltz targets Michael Froman

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4. Deal flow

5. Movin' on up (or out)

6. Channel surfing

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🗓️ Situational awareness: Join Tim and Sara Fischer today at 12:30pm ET for a conversation forecasting media trends in 2023 and analyzing the year's biggest dealmaking stories so far. Register to attend.

@tim_bays: "The Play That Goes Wrong" at New World Stages. Braving the deep freeze on Saturday to take in my first Broadway show since returning to NYC.

@kerrymflynn: "Central Park" on Apple TV+. Finished season three and cannot get over how Stanley Tucci's character, Bitsy, got her dog. 

✏️ Thanks to Michael Flaherty for editing and Jay Bennett for copy editing this newsletter.

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Media Deals

1 big thing: ICYMI... Pro Event recap

Tim Baysinger and Sara Fischer, side by side, for Axios Pro Media Deals live event

2. Additional live event questions answered

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3. Deal flow

4. Movin' on up (or out)

5. Channel surfing

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🏛️ Situational awareness: Tim and Kerry are in D.C. for Axios' company-wide retreat. But don't fret. We'll still be delivering newsletters all week!

@tim_bays: "Rules of Civility." Haven't picked up this book since the honeymoon, but a four-hour train ride to D.C. is a perfect excuse. 

@kerrymflynn: "Spare" on Audible. Listening to Prince Harry while traveling to D.C. 

Thank you for reading Axios Pro Media Deals! Please ask your friends, colleagues and Amtrak riders to sign up.

1 big thing: Whither Hulu

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2. The BFD: Atmosphere's unicorn moment

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🏈 Situational awareness: The NFL signed a 10-year deal with DAZN Group to make DAZN the exclusive streaming home for NFL Game Pass International beginning next season.

@tim_bays: Retreat day two in D.C., where absolutely nothing else is happening tonight. 

@kerrymflynn: Excited for company karaoke. 

✏️ Thanks to George Moriarty for editing and Jay Bennett for copy editing this newsletter.

Thank you for reading Axios Pro Media Deals! Please ask your friends, colleagues and Hulu subscribers to sign up.

1 big thing: Marketing, but make it compliant

Constellation cofounders Nauman Hafiz, Diana Lee and Matt Woodruff

NCAA may break its own bundle

2. The BFD: NCAA taps advisers for media rights sale

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3. Charted: DOJ vs. Google

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🗓️ Situational awareness: Join Tim and Sara Fischer tomorrow at 12:30pm ET for a conversation forecasting media trends in 2023 and analyzing the year's biggest dealmaking stories so far. Register to attend.

@tim_bays: "Black Panther: Wakanda Forever" on Disney+. Time to re-watch future Oscar winner Angela Bassett. 

@kerrymflynn: "80 For Brady" at AMC Theatres. Wow, what a day to already have tickets to an early showing dubbed "Ladies Night Out." I'll be wearing my Brady jersey — the Patriots one. 

Thank you for reading Axios Pro Media Deals! Please ask your friends, colleagues and NCAA fans to sign up.

1. The Recount's new owner

2. SiriusXM's new deal

3. Flipping the M&A channel

4. Constellation round 

5. NCAA taps advisers for media rights sale

6. Meta's VR win

What we're watching: Trian Partners' proxy fight against Disney is in full-on attack mode, with the activist hedge fund naming its board target this week and the company responding with a staunch and lengthy defense. A peace settlement doesn't look likely at the moment. Stay tuned. 

🙏 Thank you for reading us this week. 

🏛 Axios employees will be gathering in D.C. next week for our annual off-site. We'll still be sending our newsletter, though it may be streamlined on Monday, Tuesday and Wednesday. Have a great weekend. — Michael Flaherty, editor

Axios caught up with Tom Graham, cofounder and CEO of Metaphysic, to discuss the London-based AI tech startup's deal with CAA and the fast-growing intersection of AI and Hollywood.

Why it matters: Metaphysic, which gained fame for deepfake videos that featured Tom Cruise as well as work with "America's Got Talent," is now in business with one of the biggest Hollywood talent agencies. 

As part of their strategic partnership, Metaphysic Live, the firm's AI de-aging tool, will be used on the upcoming Miramax film "Here," which stars Tom Hanks and Robin Wright.

How did this partnership with CAA come about?

When you think about what you can do as a tiny new little technology company, it boils down to a couple of years ago raising awareness around the possibility for manipulated media.

It's difficult to influence governments to legislate quickly — those processes are happening, and that's fantastic. It's difficult to move internal processes at big technology companies or get them to do things which may not be in their commercial interest. But we could certainly raise awareness. 

Through that process, many people that we have partnerships and great relationships with — CAA was one of them.

You're working with them on a strategic partnership, but what exactly does this partnership outside of this movie entail?

Entertainment, AI, generative content is gonna bring all of us into content on the internet that features us. It's personalized to us. Everything about rolling that out in an ethical way ... thinking about data, thinking about individual rights and empowerment — that's a great thing to partner with CAA on. They represent so many people who have unusually valuable and commercial likenesses.

What is CAA providing? Is it mostly their relationships that they have with their clients?

They're also very focused on the future. I think that they are good investors in the future, technology-wise — but also really thoughtful about what it will look like. That's an integral part of their business ahead.

How competitive do you see this space becoming? 

When you create something that looks so real — it looks like the real world with somebody else's face — you don't f--king own it. It can't really belong to you. They have a set of rights around who they are that are fundamental. 

Metaphysic CEO Tom Graham on CAA deal and de-aging Tom Hanks

London-based startup will de-age Tom Hanks in upcoming film.

Photo Illustration: Lindsey Bailey/Axios. Photo: Steven Simione

Artificial intelligence

Axios caught up with Tom Graham, cofounder and CEO of Metaphysic, to discuss the London-based AI tech startup&#x27;s deal with CAA and the <a class="gtmContentClick" data-vars-link-text="fast-growing intersection of AI and Hollywood" data-vars-click-url="https://www.axios.com/pro/media-deals/2023/01/30/artificial-intelligence-ai-hollywood-venture-capital" data-vars-content-id="0c444fd3-68e3-4005-8f24-1073c6b5018d" data-vars-headline="Metaphysic CEO Tom Graham on CAA deal and de-aging Tom Hanks" data-vars-event-category="story" data-vars-sub-category="story" data-vars-item="in_content_link" href="https://www.axios.com/pro/media-deals/2023/01/30/artificial-intelligence-ai-hollywood-venture-capital" target="_self">fast-growing intersection of AI and Hollywood</a>.Why it matters: Metaphysic, which gained fame for deepfake videos that featured Tom Cruise as well as work with &quot;America&#x27;s Got Talent,&quot; is now in business with one of the biggest Hollywood talent agencies.

The NCAA has picked Endeavor's Karen Brodkin and Hillary Mandel to advise on its next media rights deal, Sports Business Journal reports. 

Why it matters: ESPN has paid the NCAA roughly $40 million annually, per the SBJ, during their current 12-year deal, which expires following the 2023-24 school year. 

Of note: The NCAA is considering a major change with its next rights deal by unbundling many of its championships, most notably the Women's Basketball tournament. 

While major conferences such as the Big 12 and SEC negotiate their own rights, the NCAA controls the ones for its championships, with a major exception being the College Football Playoff.

The big picture: Up until now, the NCAA has bundled the rights to its championships, except for the men's basketball tournament and both men's and women's Division I golf. 

Along with women's basketball, the NCAA is considering separate agreements for women's volleyball, the Frozen Four, College World Series and Women’s College World Series. 

Breaking out those sports could make it harder for lesser-viewed ones, such as swimming, gymnastics, bowling and fencing, to garner TV dollars because those sports rely on being packaged with more popular ones.

What's next: Talks aren't supposed to begin with ESPN on a new deal until the end of this year, SBJ reports. 

It picked Endeavor to advise on its next media rights deal.

Illustration: Aïda Amer, Sarah Grillo/Axios

National Collegiate Athletic Assocation (NCAA)

The NCAA has picked Endeavor&#x27;s Karen Brodkin and Hillary Mandel to advise on its next media rights deal, <a class="gtmContentClick" data-vars-link-text="Sports Business Journal" data-vars-click-url="https://www.sportsbusinessjournal.com/SB-Blogs/Newsletter-College/2023/01/31.aspx" data-vars-content-id="43d379d8-9562-4343-8be6-d350706a8bd3" data-vars-headline="NCAA may break its own bundle" data-vars-event-category="story" data-vars-sub-category="story" data-vars-item="in_content_link" href="https://www.sportsbusinessjournal.com/SB-Blogs/Newsletter-College/2023/01/31.aspx" target="_blank">Sports Business Journal</a> reports. Why it matters: ESPN has paid the NCAA roughly $40 million annually, per the SBJ, during their current 12-year deal, which expires following the 2023-24 school year.

Activist investor Trian Partners said on Thursday that it's targeting Disney director Michael Froman for removal from the board, in the hedge fund's bid to put  co-founder Nelson Peltz in his place. 

Why it matters: This is the first time Trian has identified which board seat it's seeking — a seat occupied by someone without the type of media industry experience the hedge fund is demanding. 

Froman, a former U.S. treasury representative during the Obama administration from 2013 to 2017, joined Disney's board in 2018. His main experience in the corporate world came with Citigroup.   

Of note: In the letter, Trian laid on thick its lack-of-relevant-experience dig at the board. 

"The current Disney directors wake up with challenging day jobs: building cars, selling clothing, processing credit card transactions, sequencing genes. All important things. But these accomplished directors are busy and we believe they cannot possibly focus sufficiently on Disney to ensure that 2023 and 2024 are nothing like 2022."

Later in the day, Disney issued a response and a staunch defense of Froman and his value to the board. 

"Mr. Froman's decades of experience in business and international affairs are critical to helping Disney assess the risks and opportunities in an increasingly complex global marketplace," Disney said in response.

"The election of Mr. Peltz or his son would threaten the strategic management of Disney during a period of important change in the media landscape," the company said, adding that Peltz's son Matthew is running as an alternate director candidate to his father.

Catch up quick: Trian Partners bought more than $800 million worth of Disney shares shortly after Disney's clunker of a fourth quarter last fall. The fund now says it owns around $1 billion worth of stock. 

"Disney could have made room for Nelson before it decided to decrease its Board from 12 to 11 directors. Instead, it chose to shrink the Board and meet us in a costly proxy fight," Trian said on Thursday, referring to the company's recent director moves.  

What's next: Disney reports its next quarterly earnings next Wednesday — it's first since Bob Iger returned. Expect to hear more from Trian that day.

Editor's note: This story was updated with Disney's response. 

Peltz targets Disney director Froman in proxy battle

The hedge fund hits again at board's relevant experience

Disney

Activist investor Trian Partners said on Thursday that it&#x27;s targeting Disney director Michael Froman for removal from the board, in the hedge fund&#x27;s bid to put co-founder Nelson Peltz in his place. Why it matters: This is the first time Trian has identified which board seat it&#x27;s seeking — a seat occupied by someone without the type of media industry experience the hedge fund is demanding.

Paramount is even more of an acquisition target after its move to merge Showtime with Paramount+.

Why it matters: Paramount has long been seen as a top M&A target ever since Shari Redstone brought Viacom and CBS back together in 2019. 

Of note: Any deal for Paramount would be tricky, given how closely the business is still tied to the fading legacy cable bundle with CBS and cable networks like MTV and Nickelodeon. 

Details: According to the news announced Monday, Showtime programming will be integrated within Paramount+, which will rename its premium tier as "Paramount+ with Showtime." The Showtime TV channel will also have that same name.

Paramount executives warned that the moves would likely lead to layoffs, which have battered media and tech companies over the past month. 

The big picture: Following a year that saw streaming lose its shine, consolidation will be on the tip of every executive's tongue in 2023. 

This spring, Warner Bros. Discovery will roll out its streaming service that combines HBO Max and Discovery+. 

More entertainment companies are also bundling services as the  market becomes more saturated. 

Catch up quick: Paramount set the stage for this integration when it began bundling Showtime and Paramount+ last year.  

Paramount+ and Showtime merger makes it a better acquisition target

Illustration of a vintage television split with a modern smart television.

ViacomCBS

Paramount is even more of an acquisition target after its move to merge Showtime with Paramount+.Why it matters: Paramount has long been seen as a top M&amp;A target ever since Shari Redstone brought Viacom and CBS back together in 2019.

Expect Disney to crystallize its strategy for Hulu this week as the company reports its first earnings since Bob Iger’s return as CEO, Tim writes.

Why it matters: Hulu's fate is a $27.5 billion question for Disney that has hung over the company ever since Disney acquired majority control of the streaming service in 2019. 

Disney is on the hook to buy out Comcast's 33% stake in Hulu — each side holds an option to trigger the deal — as soon as 2024 at a minimum valuation of $27.5 billion. 

What's next: Disney will report its earnings Wednesday after the bell. Discussion about Hulu and Disney's proxy fight with Trian Partners figure to dominate the call. 

Trian's proxy battle will come to a head during the shareholder meeting on April 3. 

The intrigue: It had long been assumed that Disney would end up owning all of Hulu by sometime next year, but Iger's surprise return last November to replace his replacement has muddied the picture. 

Last week, Bloomberg reported that Disney was looking to license its film and TV shows to other networks and streaming services, a dramatic shift from the company's push to keep all of its content exclusive to its own platforms. 

At least one analyst believes the move is a precursor to Disney offloading Hulu, with Comcast as an obvious suitor. 

"We sense investors would view a Disney sale of Hulu quite favorably as it would clarify their streaming strategy, reduce leverage and improve DTC profitability. That said, most investors struggle to see a logical buyer of Hulu beyond Comcast," Rich Greenfield of Lightshed Partners wrote this morning. 

Be smart: This is not the first time Greenfield has argued for a Hulu sale. 

Comcast execs have previously said they'd be open to buying Hulu.

Trian co-founder Nelson Peltz, who is angling to replace Michael Froman on Disney's board, believes that Disney needs to buy out Hulu as soon as possible or “get out of the streaming business.”

Yes, but: Any sale would be complicated by the fact that Disney has used Hulu within its popular streaming bundle, which has helped drive subscriptions for Disney+ and ESPN+. 

What will Disney do with Hulu?

The ultimate fate of Hulu is a $27.5 billion question for Disney.

Expect Disney to crystallize its strategy for Hulu this week as the company reports its first earnings since Bob Iger’s return as CEO, Tim writes.Why it matters: Hulu&#x27;s fate is a $27.5 billion question for Disney that has hung over the company ever since Disney acquired majority control of the streaming service in 2019. <ul><li>Disney is on the hook to buy out Comcast&#x27;s 33% stake in Hulu — each side holds an option to trigger the deal — as soon as 2024 at a minimum valuation of $27.5 billion. </li></ul>What&#x27;s next: Disney will report its earnings Wednesday after the bell. Discussion about Hulu and Disney&#x27;s proxy fight with Trian Partners figure to dominate the call. <ul><li>Trian&#x27;s proxy battle will come to a head during the shareholder meeting on April 3. </li></ul>The intrigue: It had long been assumed that Disney would end up owning all of Hulu by sometime next year, but Iger&#x27;s surprise return last November to replace his replacement has muddied the picture. <ul><li>Last week, <a class="gtmContentClick" data-vars-link-text="Bloomberg reported" data-vars-click-url="https://www.bloomberg.com/news/articles/2023-02-03/disney-explores-the-sale-of-more-films-tv-series-to-rivals" data-vars-content-id="ccbb05e2-ea66-4171-a628-ed52b8d7d292" data-vars-headline="What will Disney do with Hulu?" data-vars-event-category="story" data-vars-sub-category="story" data-vars-item="in_content_link" href="https://www.bloomberg.com/news/articles/2023-02-03/disney-explores-the-sale-of-more-films-tv-series-to-rivals" target="_blank">Bloomberg reported</a> that Disney was looking to license its film and TV shows to other networks and streaming services, a dramatic shift from the company&#x27;s push to keep all of its content exclusive to its own platforms. </li><li>At least one analyst <a class="gtmContentClick" data-vars-link-text="believes the move" data-vars-click-url="https://lightshedtmt.com/2023/02/03/is-disney-preparing-to-shop-hulu/" data-vars-content-id="ccbb05e2-ea66-4171-a628-ed52b8d7d292" data-vars-headline="What will Disney do with Hulu?" data-vars-event-category="story" data-vars-sub-category="story" data-vars-item="in_content_link" href="https://lightshedtmt.com/2023/02/03/is-disney-preparing-to-shop-hulu/" target="_blank">believes the move</a> is a precursor to Disney offloading Hulu, with Comcast as an obvious suitor. </li><li>&quot;We sense investors would view a Disney sale of Hulu quite favorably as it would clarify their streaming strategy, reduce leverage and improve DTC profitability. That said, most investors struggle to see a logical buyer of Hulu beyond Comcast,&quot; Rich Greenfield of Lightshed Partners <a class="gtmContentClick" data-vars-link-text="wrote " data-vars-click-url="https://lightshedtmt.com/2023/02/03/is-disney-preparing-to-shop-hulu/" data-vars-content-id="ccbb05e2-ea66-4171-a628-ed52b8d7d292" data-vars-headline="What will Disney do with Hulu?" data-vars-event-category="story" data-vars-sub-category="story" data-vars-item="in_content_link" href="https://lightshedtmt.com/2023/02/03/is-disney-preparing-to-shop-hulu/" target="_blank">wrote </a>this morning. </li></ul>Be smart: This is <a class="gtmContentClick" data-vars-link-text="not the first time" data-vars-click-url="https://twitter.com/RichLightShed/status/1550151402026049536?s=20&amp;t=k8A_9c5sjonqN2KG1p-8QA" data-vars-content-id="ccbb05e2-ea66-4171-a628-ed52b8d7d292" data-vars-headline="What will Disney do with Hulu?" data-vars-event-category="story" data-vars-sub-category="story" data-vars-item="in_content_link" href="https://twitter.com/RichLightShed/status/1550151402026049536?s=20&amp;t=k8A_9c5sjonqN2KG1p-8QA" target="_blank">not the first time</a> Greenfield has argued for a Hulu sale. <ul><li>Comcast execs have <a class="gtmContentClick" data-vars-link-text="previously said" data-vars-click-url="https://www.hollywoodreporter.com/business/digital/hulus-value-in-focus-as-disney-comcast-go-public-with-negotiation-tactics-1235224458/" data-vars-content-id="ccbb05e2-ea66-4171-a628-ed52b8d7d292" data-vars-headline="What will Disney do with Hulu?" data-vars-event-category="story" data-vars-sub-category="story" data-vars-item="in_content_link" href="https://www.hollywoodreporter.com/business/digital/hulus-value-in-focus-as-disney-comcast-go-public-with-negotiation-tactics-1235224458/" target="_blank">previously said</a> they&#x27;d be open to buying Hulu.</li><li>Trian co-founder Nelson Peltz, who is angling to replace Michael Froman on Disney&#x27;s board, believes that Disney needs to buy out Hulu as soon as possible or “get out of the streaming business.”</li><li>Yes, but: Any sale would be complicated by the fact that Disney has used Hulu within its popular streaming bundle, which has helped drive subscriptions for Disney+ and ESPN+. </li></ul>

Tim Baysinger

Stories

What will Disney do with Hulu?

Metaphysic CEO Tom Graham on CAA deal and de-aging Tom Hanks

Peltz targets Disney director Froman in proxy battle

NCAA may break its own bundle

Paramount+ and Showtime merger makes it a better acquisition target

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