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BFD Expert Voices - Media Deals

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The deal value of media and entertainment M&A plunged in 2022. 

Why it matters: Nielsen going private and private equity flooding Hollywood were among the year's notable M&A stories. Still, persistent economic jitters will keep dealmaking in the sector in the dumps, Kerry writes. 

By the numbers: Deal value in the sector dropped 61%, to $142.7 billion, compared with the previous year, per Refinitiv. 

The number of deals in the sector dipped 10%, to 3,247.

Deal value in the telecommunications sector dropped 35%, to $122.9 billion. 

Of note: Not all sub-sectors were down. The deal value and volume in advertising and marketing were up 79% and 7%, respectively. 

Zoom out: Overall global deal value and volume were down 38% and 18%, respectively, compared with 2021, Dan Primack writes. 

Q4 was the year's slowest quarter, a stark contrast from its being the busiest in the previous two years.

The bottom line: The industry's M&A slump tracked the broader market drop that started at the top of the year. Here's Refinitiv's H1 report.

Deal value in media and entertainment dropped 61% in 2022

1 big thing: M&A shrinkage

Illustration of an upside down television with antennas shaped like downward pointing trend lines 

Warner Bros. Discovery has struck a deal to use VideoAmp to measure its video content for its linear TV, streaming and digital properties. 

Why it's the BFD: The deal marks the latest big TV company to strike a measurement agreement with a vendor that's not Nielsen, Sara and Kerry write.

Details: The deal extends across Warner Bros. Discovery's portfolio. It follows a test-and-learn phase announced a year ago by VideoAmp and WarnerMedia, which has since merged with Discovery. 

Ross McCray, founder and CEO of VideoAmp, tells Axios he believes VideoAmp's systems capture the "real value" of Warner Bros. Discovery by tracking across mediums.

"With our currency ... [media sellers] can package their entire assets, whether it be from traditional linear, from digital or from streaming all in one area," he says. "Then you can see the total reach of the entire portfolio, whereas previously it's done in silos."

2. The BFD: WBD's new measurement partner

Illustration of a hand measuring a play button

The Consumer Electronics Show hopes to draw at least 100,000 in-person attendees to its annual trade show in Las Vegas this week, Sara and Ina Fried write. 

Why it matters: It's unclear when, if ever, the mega-conference will return to its pre-pandemic peak of over 180,000 attendees.

Zoom out: As one of the largest trade shows in the world, CES sets the scene each January for dealmaking across the tech, media, manufacturing and gaming industries.

More than 2,500 exhibitors from 166 countries are expected to debut new gadgets and products at the Las Vegas Convention Center this year.

Executives across various industries will meet at smaller conference events throughout the city. Executives have 29 meetings on average while at CES, per the Consumer Technology Association.

Are you attending? Reply to this email and let us know why.

3. Charted: 🎰 CES returns

BC Partners agreed to buy a majority stake in Madison Logic, a New York-based provider of B2B digital marketing services, from Clarion Capital Partners for a reported $750m. https://axios.link/3i9Dzug 

Donald Trump Jr. signed a multiyear podcast deal with Rumble Inc., the user-generated video platform that serves as a conservative alternative to YouTube, Sara and Mike Allen scoop. https://axios.link/3X4n8yr

ICYMI: Michael Bloomberg is interested in acquiring either Dow Jones or The Washington Post but has not yet approached Rupert Murdoch about his interest, nor has he begun to engage any official third parties, like bankers, to evaluate the opportunity, Mike and Sara scoop. https://axios.link/3IrQsef

Canada's antitrust tribunal approved Rogers Communications' bid  for Shaw Communications. The C$20b deal is still awaiting other approvals, per Reuters. https://axios.link/3Gab4od

Fidelity slashed its carrying value of Twitter by 56% during the first month of Elon Musk's ownership, Dan reports. https://axios.link/3WFjYkG

Cineworld, the UK cinema operator in bankruptcy proceedings, said it would not sell any of its assets individually and denied talks with AMC Entertainment, per Reuters. https://axios.link/3GA3BjL

USA Acquisition, a tech SPAC formed by Union Square Advisors, withdrew registration for a $150m IPO. https://axios.link/3vC4jXm

4. Deal flow

AMC Entertainment appointed former Sundance chief Keri Putnam and tech executive Denise "Dee" Clark to its board. Lee Wittlinger, a managing director at Silver Lake, will step down. https://axios.link/3WT1VXZ

Andy Sewer stepped down as EIC of Yahoo Finance. https://axios.link/3Gz4o4L

Evan Smith stepped down as CEO of The Texas Tribune. https://axios.link/3WFRZS7

John Thornton will step down in a few weeks from the board of The Texas Tribune after 13 years. https://axios.link/3GcgNKx

5. Movin' on up (or out)

"Gaming is now a $184 billion business, a lucrative IP resource for other media — and the leading edge of the tech industry, both as a business and a harbinger of the industry's policy battles," Stephen Totilo writes.

How Gerry Cardinale became the go-to dealmaker for the likes of the Yankees, AC Milan and Ben Affleck (Insider)

"People need to calm down a little bit about sports," Cardinale told Insider. "This euphoria around sports scares me because it suggests a bubble environment and a caveat to beware."

David Zaslav's rocky ride as Hollywood's newest czar (Los Angeles Magazine)

"If the fortunes of Warner Bros. Discovery don't turn around fast enough, then none of his lieutenants should get too comfortable. But if things somehow work out as Zaslav envisions they will look for more expansion and buying of assets, which has been this executive's fallback since he landed in Discovery's ranks all those years ago," Steve Appleford writes.

6. Channel surfing

Illustration of a surfer with a television in the place of his head.

🇬🇧 Situational awareness: The Guardian's offices are closed until at least January 23 following a suspected ransomware attack on its global IT systems last month.

@tim_bays: "The Recruit" on Netflix. This was nice to see after watching Noah Centineo get wasted in "Black Adam." 

@kerrymflynn: "Ticket to Paradise" on Peacock. More movies should have outtakes and bloopers during the credits. 

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

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January 03, 2023

1 big thing: M&A shrinkage