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Today's Media Trends is 1,964 words, a 7 minute read.
Illustration: Sarah Grillo/Axios
Efforts to dethrone Netflix abroad are underway, as more money pours into upstarts looking to compete locally against the streaming giant.
Why it matters: Netflix's user base is nearing saturation in the U.S., so it needs to continue growing abroad if it ever wants a chance at profitability.
The big picture: Around the world, companies are teaming up to create rival streaming services to compete with Netflix, and are withholding their top content for their own efforts.
Yes, but: Analysts mostly agree that the streaming giant is so far ahead of the competition that it will be tough to stop it from continuing to add subscribers overseas — even though its earnings report last week suggested otherwise.
Between the lines: Analysts don't foresee Netflix's footprint growing that much bigger in some of its biggest international markets.
What's next: The next big battleground for Netflix is India, one of the fastest-growing streaming markets.
The bottom line: "These localized players reflect modest and isolated competition and almost always ends up being a partner outside their home market (or core content window), says Matthew Ball, former head of strategy at Amazon Studios.
With five months left in the year, 2019 has already set the record for the highest number of television blackouts in history, according to new data from the American Television Alliance (ATVA).
Why it matters: Increased disputes between TV networks and their distributors — mainly cable and satellite companies — over how much networks should charge distributors for the rights to air their content.
Driving the news: CBS said Saturday that AT&T dropped CBS-owned television networks from the channel lineups of millions of AT&T customers, including DIRECTV, DIRECTV NOW and AT&T U-verse TV customers, in markets all over the United States.
The big picture: These disputes, driven by a shrinking traditional TV advertising market, are leading to more programming blackouts for consumers, and are forcing some smaller, niche cable channels out of business altogether.
Some disputes last for months. Others never get resolved.
What's next: Expect more blackouts as major programmers weigh whether to re-up distribution deals.
Be smart: Regulators rarely intervene in these fights, even when they're asked to, because they believe these disputes are best left to the market.
Gannett Co, the largest newspaper owner by circulation in the U.S., and its rival GateHouse Media, the largest newspaper owner by number of papers in the U.S., are currently in talks to merge, The Wall Street Journal reports.
Why it matters: The combination of the two publishing powerhouses means that a single company would own 1 in every 6 newspapers in the United States.
Details: GateHouse, which is owned by New Media Investment Group Inc., has a reputation for slashing costs and consolidating resources.
Be smart: Unlike some recent mergers in broadcast and telecom — also legacy industries upended by technology — experts don't believe that the deal would cause any regulatory concerns, because the companies don't really overlap in key markets.
The bottom line: "I think this is part of a continuation of local news publishers trying to get to an economically sustainable business model," says David Chavern, CEO of the News Media Alliance, a newspaper trade association that represents thousands of papers.
Patch, the hyperlocal (and profitable) digital news platform, is doubling down on digital transactions as it seeks to pull further away from advertising as a sole revenue source, Patch CEO Warren St. John tells Axios.
Why it matters: Scaling a high-margin revenue stream that's not contingent on page views (the way advertising rates often are calculated) is critical in local news, because truly local news is usually only relevant to small group of people.
The big picture: For a long time, a lot of the focus on saving local media has been on subscriptions and memberships. Both Facebook and Google are investing heavily in developing business models that work for local companies around those models.
The bottom line: "Payments is probably best highest margin scalable solution for local," St. John said last quarter.
What's next: The company is looking to increase payments within its classifieds section, which launched last quarter.
Illustration: Aïda Amer/Axios
Democratic candidates are shooting at big companies on the campaign trail, and getting rewarded with a huge social-media echo.
Why it matters: There's more pressure than ever for companies to take stands on social policies. But brands risk losing trust if they hit back too hard. Progressive candidates are taking advantage of that dynamic.
The companies most likely to be attacked are ones facing criticism over the minimum wage, jobs, taxes and competition — like Walmart and Big Tech — according to data pulled for Axios by the social intelligence firm Zignal Labs.
Snapchat reports second quarter earnings after market closes on Tuesday. Snap's stock is up dramatically since its low-point in 2018 after a rough redesign rollout.
Facebook reports earnings after the market closes on Wednesday. Despite continued scandals around privacy, Facebook's stock is up more than 50% in 2019.
Alphabet reports earnings after the market closes on Thursday. The company is also awaiting multi-million dollar fine from the Federal Trade Commission.
Amazon reports earnings after the market closes on Thursday, just days after the company said "Prime Day" recorded its biggest 24-hour sales day ever.
Twitter reports earnings before the market opens on Friday. The company has faced fewer government scandals than some of its rivals this quarter.
Illustration: Aïda Amer/Axios
An increase in federal penalties against tech companies for violating kids' privacy rules is shaping new expectations for how the internet will be governed, Kim Hart and I reported yesterday.
Driving the news: The Federal Trade Commission has reportedly approved a settlement with Google over kids' privacy violations on YouTube, per The Washington Post.
The big picture: "This fine and the various debates about COPPA 2.0 are inevitably going to take children's digital protections to a much more comprehensive place," emails Dylan Collins, CEO of kids' tech platform SuperAwesome.
The bottom line: The internet was originally built for adults, and the industry has never taken full responsibility for how kids use it. That could finally begin to change if policymakers and regulators ratchet up the pressure.
Disney's presentation of Marvel's "Avengers: Endgame" has officially surpassed "Avatar" to become the world's highest-grossing film of all time, several months after the film obliterated opening weekend records.
Why it matters: Disney has had the top grossing movie every year since 2012 and been the top grossing studio since 2016.
The big picture: Disney's success can largely be attributed to the three franchises that it has cultivated or acquired over the past few years: Marvel, Pixar and Star Wars.