Thanks for subscribing to Media Trends. Tell friends to follow along by signing up here.
Welcome to Q2, often the most brutal quarter for publisher ad sales. There are no major commercial holidays that fall reliably in the quarter, with the exception of Mother's Day. There are no looming advocacy deadlines like Congressional recess that drive cause and appeal messaging. The bright spots: Travel (summer trips), pharmaceuticals (allergies), financial services (tax season), sports (March Madness, NBA finals, Masters) and some retail (dads and grads in June).
In a race for survival, media companies are doing whatever they can to consolidate, offering up new concessions to make sure they can snag or sell any assets that would help their legacy businesses compete with the almighty power of Big Tech:
Why it matters: A wave of deals and negotiations over a two-to-three year window will change how news and information are produced, consumed, and disseminated across the world.
Photo: Chris Kleponis/Pool/Getty Images
Of the major media deals pending DOJ approval, few have escaped allegations of improper White House meddling, including the latest saga surrounding Sinclair Broadcast Group.
Why it matters: The viral Deadspin video showing dozens of Sinclair anchors reciting scripts about fake news reminded people of a history of Sinclair pro-Trump leanings at a time when the company is pushing to get a $3.9 billion merger approved. The deal would make Sinclair the largest local broadcaster in the country.
Trump previously suggested support for a merger between 21st Century Fox (the parent company to Fox News) and Disney, and declined to support a merger between AT&T and Time Warner (CNN's parent company.)
And Trump tweets this morning:
"The Fake News Networks, those that knowingly have a sick and biased AGENDA, are worried about the competition and quality of Sinclair Broadcast. The “Fakers” at CNN, NBC, ABC & CBS have done so much dishonest reporting that they should only be allowed to get awards for fiction!"
What's next? The DOJ and FCC are currently weighing approval of the deal, which is expected to go through, barring a few requested station divestitures by Sinclair. Rival conservative networks, like One America News, NewsMax and TheBlaze, have been expressing concerns about the merger for months.
If the Sinclair deal goes through, (barring any proposed divestitures), the Maryland-based broadcaster would reach 72% of U.S. TV households, which is unprecedented for any local broadcaster, regardless of its political affiliations.
Why it matters: Local TV news is still the most popular way for Americans to get their news and it's the only TV news segment that is more heavily consumed by less educated, less wealthy Americans, according to Pew.
Furthermore, consumers may not realize that their local NBC or Fox affiliate is owned by Sinclair or that they are being exposed to scripted messaging around fake news in the first place.
In 2017, the NBCU's "Audience Studio," the group that manages its advertising data platform, had over 500 clients buy ads based off of audience data — not Nielsen ratings — a 50% increase year over year, Axios has learned.
The company has sold roughly $1 billion of data-based ads over the past year, and plans to meet the same goal over the next year.
Now, the whole industry is catching on:
Why it matters: The rise of streaming and multi-device content consumption has forced marketers to think differently about the most effective way to reach their audiences, and that often means using audience data, not traditional TV ratings, as a currency for television ad buying.
But, but, but: Audience-based ad buying, while growing, it still a very small portion of overall TV ad-buying — accounting for only 10%, roughly, of total TV advertising. And Nielsen, which often gets a bad rap for being "behind the times" is involved in the technology that's powering some of these networks' efforts, like Open AP.
ESPN's new "30 for 30" franchise film, “The Last Days of Knight” will be available exclusively on the new ESPN+ app, which debuts April 12th for $4.99 per month, Axios has learned.
Why it matters: In a push to boost its streaming efforts, ESPN is putting some of its most popular content behind its new paywall. The network is looking to migrate its linear TV audience to streaming in response to the rapid succession of its audience on linear TV. (ESPN has lost roughly 12% of of its traditional TV subscribers in six years.)
In addition to “The Last Days of Knight,” ESPN Films is developing other docuseries exclusively for ESPN+. The full 30 for 30 library will live exclusively on ESPN's new app.
The big picture: ESPN+ will be Disney's first over-the-top direct-to-consumer service offering, but not its last.
Illustration: Sam Jayne/Axios
All eyes this morning are on Spotify, as the music streaming giant goes public without a traditional IPO process, Axios' Dan Primack writes.
"Spotify is hoping to be valued as the Netflix of music (or audio broadly) thanks to its ability to serve up custom recommendations to listeners. Not surprisingly, its finance chief previously spent nearly 12 years in the same role at the movie streaming giant," Axios' Kia Kokalitcheva emails me.
Photo credit should read ANA AREVALO/AFP/GettyImages
President Trump's plan to impose at least $50 billion worth of annual tariffs and other penalties on China is causing stress for some Hollywood executives, which worry box office revenues could be stifled in one of their most lucrative markets.
But Motion Picture Association of America Chairman Charles Rivkin sees it differently. “President Trump probably knows this industry better than any president since Reagan,” Rivkin told The New York Times Sunday.
“I think he understands that entertainment is important both as an economic force — jobs in every single state — and as a projection of American values. It’s our soft power. It’s showing the world what America is capable of.”— Motion Picture Association of America President Charles Rivkin
Since the signing of an agreement in 2012, which granted greater access to the Chinese market for U.S. distributors, box office revenues in China for American movies have grown from $863 million in 2011 to approximately $8 billion in 2017, making the Chinese box office the second largest in the world.
At its peak, Cambridge Analytica was a bigger attention topic than all Donald Trump stories combined, according to data across thousands of Parse.ly's publishers/network.
"People are paying close attention to the Cambridge Analytica scandal... Our data shows that in the past two weeks, views shot up by a factor of 18 when it came to articles mentioning 'Cambridge Analytica', 'Mark Zuckerberg', or 'Facebook' compared to the weeks prior. "— Andrew Montalenti, co-founder and CTO of Parse.ly
Why it matters: This is rare for non-Trump news stories/topics in the last few months, says Parse.ly. But that only lasted a day. Now that the Facebook fervor has died down, Trump is back on top.
Meanwhile, a movement by publishers to only run ads on trusted websites is picking up steam.
Photo: Screenshot of zig.com
NOTE: Last week Axios' SurveyMonkey poll of results showed that adults, ages 18+ in the U.S. are not as engaged in Snapchat, with many of them saying they had no opinion of the brand. Snapchat pointed out that many of its users are younger than 18. Fair point! We're going to try and survey younger folks too. Stay tuned ...