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Illustration: Rebecca Zisser/Axios
In an unexpected twist yesterday, CBS blew up a highly-anticipated deal to merge with its former sister company Viacom by filing a lawsuit against the longtime parent company of both networks, National Amusements.
Why it matters: Analysts say CBS is using a "nuclear option," a rare right included in its charter that lets the dual-stock company actually sue its parent. A volatile media landscape is forcing them to use the option now, to save itself from a deal it thinks would be bad for its shareholders and CBS' long-term success.
Bottom line: The deal looks closer to dead than alive. If CBS loses the suit, National Amusements would still need to find a new board to approve the deal, which would be difficult.
A successful lawsuit would free CBS from over 20 years of majority control by National Amusements and its powerhouse executives Sumner Redstone and his daughter Shari Redstone.
The intrigue: National Amusements said yesterday they believed CBS only surfaced the lawsuit after an ongoing conversation over whether a physically and verbally aggressive board member would be allowed to remain on CBS’ board resurfaced last week.
Merger talks have gotten messy over the past few weeks amid reports detailing a growing rift between Redstone and CBS Chairman Les Moonves.
What's next: The outcome of the lawsuit could have big implications for public companies with dual-class shares, like Google and Facebook.
Illulstration: Lazaro Gamio / Axios
Traditional TV networks spend millions of dollars renting out fancy venues and bringing in talent acts to wow advertisers their annual Upfront presentations. The schedule is itself a thing of prestige. Only the top-tier networks will present in New York this week.
Why it matters: Billions of dollars of advertising dollars are spent on advanced commitments of programming during the TV UpFronts season.
The big takeaways so far, per Variety:
What's next? ESPN and Disney/ABC are up today. CBS and Turner are Wednesday.
Between the shrimp cocktail shooters and flashy performances, you would have no idea that traditional TV networks have a very real problem on their hands.
The big picture: According to four years of data from Nielsen's Total Audience Reports, every age group except those ages 65+ is spending less time watching television live or via DVR.
Netflix chief content officer Ted Sarandos said Monday that the streaming giant plans to spend 85% of its estimated $8 billion content budget this year on original series, Variety reports.
By the numbers:
Yes, but: "It's important to understand there's no definition of an Original' - even versus a license - and there are many different flavors," tweets former Amazon Studios head of strategy Matthew Ball. "The differences between these flavors is critical to understanding any statement around spend, return, engagement, expectations, growth etc.
Illustration: Rebecca Zisser/Axios
Media companies have a lot to gain from the Supreme Court's decision Monday to allow states to engage in legalized sports betting.
Why it matters: Publishers are scrambling to find new ways to make money since big tech has gobbled up most of their ad revenue. There are a lot of business and growth opportunities for media companies around sports gambling.
Recode's Peter Kafka highlights three examples of media companies already investing in opportunities around legalized gambling:
"The growth won't end with just the sports media. For years, BetDSI has offered odds on politics, technology, entertainment and other industries. As those types of odds become more prevalent in the public, more and more outlets will begin reporting on them."— Scott Cooley, spokesperson for online sportsbook BetDSI
Illustration: Abby Chen/Axios
The internet age that started out as a boon for broadband and wireless providers has become an existential crisis as they face increasing competition from Silicon Valley, Axios' Kim Hart writes.
Why it matters: It's no longer enough to power the pipes and cell towers that send internet traffic coursing around the world. The services that ride on top of that traffic, like Google, Facebook and Amazon, now dominate the internet ecosystem.
Go deeper: Telecoms fight to save their businesses
Data: PriceWaterhouseCoopers; Chart: Lazaro Gamio / Axios
U.S. smartphone data use is expected to surpass fixed broadband use for the first time this year, according to PriceWaterhouseCoopers' latest Media and Entertainment outlook.
Why it matters: The consumption trend is pushing media and entertainment companies to consider partnerships and mergers with wireless services in order to get programming in front of consumers where they spend most of their time — mobile devices.
What's next: The continued demand for mobile broadband is also driving the development of new wireless technologies, such as 5G, as Axios noted when we first covered the study,
Photo: Spencer Platt/Getty Images
Intersection, the Alphabet-backed smart cities startup, known for creating free internet kiosks for cities, is pushing to make free internet accessible in as many major cities as possible across the globe.
Between the lines: The two things a city must have in order to be viable for Intersection internet infrastructure from Intersection., according to the company's CEO and former advertising guru Ari Buchalter: