Disney will pull content from Netflix to create its own streaming service - Axios
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Disney will pull content from Netflix to create its own streaming service

AP

Disney announced on its Q2 earnings call today that it's yanking it's entertainment content from Netflix beginning in 2019, and will instead create its own direct-to-consumer streaming video on-demand (SVOD) service and an additional over-the-top (OTT) streaming service that will separately house all of its ESPN and sports content.

  • CEO Bob Iger says Disney will use its capital to invest in a studio that will produce original content for its entertainment streaming bundle. The new SVOD platform will be the exclusive home in the U.S. for live action movies from Disney and Pixar.
  • Disney also purchased a 75% stake in BAMTech to power its over-the-top streaming service for ESPN. BAMtech is a streaming technology provider that's a joint venture between Baseball Advanced Media, Disney and the NHL. BamTech currently powers streaming for a bunch of networks, including HBO, MLB, and NHL. Disney announced Tuesday that it's pouring in an additional $1.58 billion in order to become the majority stakeholder in the company (up from owning 33% stake) and will utilize the technology reimagine its direct-to-consumer relationship with a new data-based streaming platform for ESPN.

Why the Netflix news matters: Iger says Disney is best-positioned to succeed in today's chaotic media landscape if it can capitalize on consumers' close relationship to the brand. To do this, Disney needs to move its business model closer to consumers and cut out the distribution middle man that is Netflix. With a standalone streaming package, Disney will need to negotiate new distribution deals with multichannel video programming distributor (MVPD) providers, like satellite providers and cable operators, although Iger says the company has not yet had these conversations.

Why the BAMtech news matters: Disney has been behind some of its competitors in transitioning into a digital-first, direct-to-consumer business model. One of the biggest rivals of Disney's ABC (and from a sports perspective ESPN), CBS, has had a streaming network for nearly three years and most of the major sports networks have been operating on streaming networks for years as well. BAMtech, which powered the MLB's streaming service, will give Disney access to a data-based platform that will transform the way Disney can sell ads, service content and connect with consumers.

What about other Disney assets, like Marvel and Star Wars? Unclear. Iger said they are working through the distribution, rights and streaming opportunities associated with those two brands. Netflix announced yesterday its first acquisition ever — Millarworld, a comic producer — which could have something to do with the void that Disney pulling its Marvel content from its platform will create.

Disney stock was down nearly 5% today in after hours trading. The company reported a 23% loss in cable revenue, due in part to advertising declines and high programming costs at ESPN.

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McCain's new memoir to be released in April

Matt Rourke / AP

Senator John McCain is writing a memoir titled "The Restless Wave: Good Times, Just Causes, Great Fights, and Other Appreciations," which will be published by Simon & Shuster's this coming April, according to the AP. The Senator received a brain cancer prognosis in July, five months after signing on for the book deal, and has become an emboldened critic of President Trump.

Why it matters: The memoir has already changed its focus since McCain's diagnosis, from international issues to more of a reflective work on McCain's experience and career, per AP. Originally, the title was slated to be: "It's
Always Darkest Before It's Totally Black." "This memoir will be about what matters most to him, and I hope it will be regarded as the work of an American hero," said Jonathan Karp, president and publisher of Simon & Schuster's.

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Facebook employees fret about the company's Russia problem

Facebook's developer's conference earlier this year. Photo: Noah Berger / AP

BuzzFeed News' Charlie Warzel finds that employees at Facebook feel the company doesn't deserve to be the focus of the deepening crisis of Russian election meddling online, especially after critics previously hit the company for censoring content. "There are lots inside thinking, 'We're the victims,'" one source told him, and that the company is "just a battlefield in a greater misinformation campaign."

Go deeper: The whole story is worth reading to get a sense of what the mood is like inside the secretive company.

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After dropping for 3 years, uninsured rate rising

A doctor and patient at a health clinic in Oregon. Photo: Gosia Wozniacka / AP

After consistent declines over the past three years, the rate of U.S. adults without health insurance has begun to rise, according to new data from Gallup. One year ago, the uninsured rate was 10.9%, down from 18% in early 2013. Now, it has ticked back up to 12.3%, the highest percentage recorded since 2014.

Why it matters: The steep drop in the uninsured rate was one of the Affordable Care Act's biggest successes since it went into full effect. If that's being reversed now, expect a lot of debate over how much is because of the months of repeal efforts and the Trump administration’s vocal opposition to the law.

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Trump interviewed U.S. attorney nominees in New York

Photo: Carolyn Kaster / AP

President Trump has personally interviewed at least two candidates to fill the open U.S. attorney vacancies in New York, reports Politico: Geoffrey Berman for the U.S. attorney post in the Southern District of New York, and Ed McNally for the Eastern District of New York.

The interviews are unusual for a president, and have raised concerns among critics of potential conflicts of interest, as U.S. attorneys are supposed to operate independently from the president. Matthew Miller, former Department of Justice spokesman under the Obama administration said Thursday that Obama never interviewed a U.S. attorney candidate during his two terms.

The White House's defense: "These are individuals that the president nominates and the Senate confirms under Article II of the Constitution," a WH official told Politico. "We realize Senate Democrats would like to reduce this President's constitutional powers. But he and other presidents before him and after may talk to individuals nominated to positions within the executive branch."

  • Preet Bharara, the former U.S. attorney in the Southern District of New York who was fired in March, tweeted Wednesday: "It is neither normal nor advisable for Trump to personally interview candidates for U.S. Attorney positions, especially the one in Manhattan."
  • And this isn't the first time Trump has done this. Politico points to Senate Judiciary documents that reveal Trump met with Jessie Liu, the candidate for U.S. attorney in the District of Columbia, earlier this year. That meeting raised questions from Democrats in particular, though she was later confirmed.
  • "For him to be interviewing candidates for that prosecutor who may in turn consider whether to bring indictments involving him and his administration seems to smack of political interference," Sen. Richard Blumenthal (D-Conn.) told Politico.
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Retailers can't find qualified workers

A now hiring sign is shown in the widow of an Express in NYC. Photo: Mark Lenihan / AP

Staffing companies that work with some of America's biggest retailers say that the industry is struggling to attract quality workers at both the store associate and management levels, Reuters reports.

Why it matters: It's good news for workers that an historically good labor market is generally enabling folks to eschew jobs that don't pay well or offer competitive pay. But it couldn't come at a worst time for the traditional retail industry, which will struggle to differentiate itself from cheap e-commerce if it can't afford to hire quality salespeople.

  • Melissa Hassett of ManpowerGroup Solutions, whose clients include Lowe's, Pep Boys, and Staples, says that retailers are having particular difficulty "hiring is the lower level, the seasonal or entry-level employees," because applicants are balking at the low pay and unpredictable schedules typically offered by the industry.
  • The struggles of traditional retailers of late has also limited their ability to pay competitive bonuses for retaining " talented regional managers or heads of business lines."
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Trump attributes U.K. crime spike to terrorism. The report doesn't

President Trump and U.K. Prime Minister Theresa May at the G20 summit in July. Photo: John MacDougall / Pool Photo via AP

In a morning tweet, President Trump tied increasing crime rates in the United Kingdom to the "spread of Radical Islamic terror" after the country suffered a series of terror attacks in 2017:

Fact check: While the U.K.'s Office of National Statistics annual crime report did indeed mark a 13% year-on-year increase in crime, it barely mentions terrorism. The portion of the report likely to cause more concern across the pond: a notable increase in violent crimes like knife attacks and sexual assaults over the past year, per The Guardian.

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Chicago considers ride-hailing tax to fund public transit

A car with both Uber and Lyft signs. Photo: Richard Vogel / AP

Chicago Mayor Rahm Emanuel proposed on Wednesday a tax on ride-hailing companies, the revenue from which would be exclusively invested into the city's public transit. The proposal is for a a $0.15 fee in 2018, increasing to $0.20 in 2019, added on top of an existing fee of $0.52. If it passes, this will be the first ride-hailing fee in a U.S. city dedicated to a city's public transit.

Why it matters: Questions over ride-hailing's impact on public transit have persisted over the years. Last week, researchers published a study that showed that services like Uber and Lyft have led to a 6% decline in public transit use by respondents. Still, the companies have continued to say that they want to be a partner to public transit systems in cities.

From Lyft:

We appreciate the Mayor working to build a sustainable future for ridesharing drivers and passengers in Chicago and look forward to continue collaborating on providing safe, convenient and affordable transportation options for the city.

From Uber:

When safe and affordable rides are available across every neighborhood -- whether it's by train, bus, or rideshare -- Chicagoans can get to their jobs or family obligations without having to own a car. At Uber we believe that the future of urban transportation will be a mix of public transit and ridesharing, and that by encouraging residents to use a variety of options, we can all ride together to build a better Chicago.
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Paul Ryan jabs Trump over tweets, staff turnover

Cardinal Timothy Dolan, the archbishop of New York, hugs Speaker Ryan after he spoke last night. Photo: Julie Jacobson / AP

Speaker Paul Ryan poked fun at Trump during last night's 72nd annual Alfred E. Smith Memorial Foundation white-tie dinner, which always draws top politicians, and includes a comedy routine for New York elite (via AP and NYT):

  • "Enough with the applause ... You sound like the Cabinet when Donald Trump walks into the room."
  • "I don't think I've seen this many New York liberals, this many Wall Street CEOs in one room since my last visit to the White House."

More from Ryan

  • "I know why Chuck [Schumer] has been so hard on President Trump. It's not ideological; Chuck is just mad he lost his top donor."
  • On Trump's remarks to the dinner last year: "Some said it was unbecoming of a public figure and they said that his comments were offensive. Well, thank God he's learned his lesson."
  • "The truth is, the press absolutely misunderstands and never records the big accomplishments of the White House ... Look at all the new jobs the president has created — just among the White House staff."
  • "Every morning I wake up in my office and I scroll through Twitter to see which tweets I will have to pretend I didn't see later on."
  • "Every afternoon former Speaker John Boehner calls me up, not to give advice, just to laugh."
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The moral voice of Trump's White House

White House Chief of Staff John Kelly speaks yesterday in the Brady Press Briefing Room.Photo: Pablo Martinez Monsivais / AP

Sexual abuse in Hollywood. Social media abuse in Silicon Valley. Political abuse in the White House. Dive into Twitter for a few minutes, and these can feel like the worst of times. So everyone, and the GOP establishment in particular, seems hungry for moral clarity.

White House aides, beaten down by criticism from friends and beleaguered by the words and actions of the boss, got a rare moral boost from Chief of Staff Gen. John Kelly as he offered a highly emotional and highly personal explanation/defense of Trump's outreach to families who lost young men in Niger.

  • Per Jonathan Swan, some White House aides teared up as Kelly described, during a rare appearance in the White House briefing room, what it was like for a fallen soldier to return home. Other aides stood watching him on TV, in stunned silence.
  • "Kelly has managed to make himself the moral core of the Trump administration," a top White House official told us. "He just has so much credibility right now ... And he's in the best possible position, because he doesn't have to go out there and face the press every day. If he picks his spots he is now an extraordinarily credible and effective spokesperson on issues that need some moral clarity to them."
  • Left unspoken: Trump rarely leaves staff feeling this way.
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Five other times Twitter pledged to crack down on abuse

It's not the first time Twitter has pledged to crack down on abuse. Photo: Matt Rourke / AP

The problem with Twitter's latest pledge to keep users safe on the platform isn't the words it used. It's the fact that it has done this so many times before

Do the math: This is at least the sixth time in the last four years that Twitter has pledged to crack down on abuse.

After Axios wrote about Twitter's latest crackdown on Thursday, writer Chuq Von Rospach said, "For the sixth time by my count…"

Von Rospach said he initially just made up a number. Then he counted them.

Here are five other times in recent years that the company has said it was cracking down:

Twitter's response: Asked why Twitter should be believed, a spokesman acknowledged "that's a fair question" and added the following:

Too many times we've said we'd do better and have promised more transparency but have fallen short delivering on them. However, we've never publicly opened up our internal roadmap around safety like this before. Now — for the first time — everyone can see exactly what updates we have planned and where we're headed, and most importantly, hold us accountable for delivering on those specific promises. We'll be giving real-time updates on these efforts to give people a better understanding not only of what these changes are but the process involved. Ultimately our hope is that this new level of openness will help build trust as we work to make Twitter safer place.