Friday Dump 🥟 - WBD sorrows, DOJ/Venu investigations, Snoop's Olympic brand deal

Hey hey it’s Friday Dump 🥟 day!

Each Friday, we’ll breakdown 3 sports business stories that have caught our eye throughout the week. They will be assembled in the following format:

🔴 - Stories that make us stop, think, and question.

🟡 - Stories with a hint of risk and unpredictability.

🟢 - Stories that make us feel good to go and empowered.

Now get off the couch and read this bad boy.

🔴 WBD might just suck at media. Just when we thought things couldn’t get messier with Warner Bros. Discovery and their portfolio of media assets, we hear about this bombshell: shares plunged Thursday after the company recorded ~$10B Q2 loss, hit by a write-down in the value of its cable networks. WBD posted a $9.1B non-cash goodwill impairment charge from its cable networks segment, showing that CNN, TNT, Food Network, etc. continue to be disrupted by streaming services. So what does all this mean? Well…it’s essentially an asset reevaluation that accounted for the difference between the “fair value” and “book value” of their networks. Networks that have downgraded in value due to continued softness in U.S. linear ad market and uncertainty around the NBA rights renewals. What a shit show…

• Domestic streaming subscribers were down slightly from Q1 (52.4M vs. 52.7M)

• In the studio segment, revenue was down 4% year over year at $2.4B. TV revenue was down 27% and video games revenue dropped 41%.

• Networks revenue dropped 8% overall, with distribution down 8% ,and ad sales decreasing 9%.

🟡 DOJ wants in on the action. Nearly a week after Venu’s pricing model was released, the U.S. government decided they wanted to get involved. Because why not? Sentors Elizabeth Warren and Bernie Sanders and House Representative Joaquin Castro have sent a letter to the DOJ asking it to investigate and prevent Disney, Fox and Warner Bros’ from starting their joint venture of Venu Sports, which will combine the networks of ESPN, Fox Sports and TNT Sports in a direct-to-consumer streaming service. The 3 members of Congress urged the DOJ to examine Venu Sports “and oppose it if it violates antitrust or telecommunications laws or regulations.”

• In a letter obtained by The Athletic, the three Democrats expressed serious concerns about Venu Sports, saying that it is…

  • “poised to control more than 80% of nationally broadcast sports and half of all national sports content, putting it in a position to exercise monopoly power over televised sports. The market power of its three giant parent companies would enable it to discriminate against competitors and increase prices for consumers.”

• Venu is already facing a legal challenge from FuboTV, a direct-to-consumer provider that carries ESPN and Fox Sports (not TNT).

  • It sounds like Warren, Sanders, and Castro agree with Fubo’s premise that ESPN, Fox Sports, and TNT are not offering other platforms the opportunity to combine with the trio of networks.

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🟢 Drop It Like It’s Hot, Paris. We can’t be the only ones who have noticed how prevalent NBC has made Snoop D.O.double G during these Olympic Games, right? Ok, phew thank god! And for good reason because apparently NBC is paying Snoop $500K per day, which would come out to over $8M total for the entire Olympics! 🤯 (uhhh can you say no-brainer?!). He’s basically been the U.S. mascot for the Games and it’s been incredible. From the commentary, to the dance moves with the U.S. women’s gymnastics team, to taking swimming lessons from the legend, Michael Phelps. NBC even has a hashtag they’ve incorporated throughout the games…#followthedogg.

• But we all Snoop is a unicorn. He’s one of the OGs where old and young still love him. He’s chill, hard-working, hilarious, and always “keeps his mind on his money and his money on his mind”, which plenty of people can relate to.

• It’s one of the reasons why he has so many brand deals. Since the early 90’s, when his first album, Doggystyle, was released he has endorsed a staggering 43 different brands.

  • Brands like Dunkin’, Corona, Klarna, Gucci. The guy’s been everywhere!