Pink's Bottom Line on Media, Money and Sports
Traditional pay television, retail sales and NFL quarterbacks
In today’s newsletter, I discuss the future of pay television, retail sales and NFL quarterbacks.
MEDIA: Traditional Pay Television
I just came across a story from eMarketer from late September that appears instructive on the future of traditional pay television in the United States.
According to that story, consumers will cancel their multichannel television subscriptions — think cable and satellite — in big numbers as that eMarketer story says that by the end of this year alone a total of 6.6 million homes will have cut the cord.
That translates into just 77.6 million homes with multichannel television packages in their homes at the end of the year, according to that story, which would be a far cry from the peak of roughly 100 million pay tv homes in 2014.
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The decline in traditional cable and satellite television subscribers has broad implications for the major media companies as it negatively and dramatically impacts their dual streams of revenue — subscription and advertising — generated by their cable television networks.
That eMarketer story also says that the trend of cord-cutting will continue for the next several years.
As such, I suspect the cord-cutting trend will take an even deeper toll on those media companies and that, within a few years, the pay tv market will morph into something very different from what we have today.
MONEY: Retail Sales
Retail sales in the United States rose modestly in October compared to September, according to a report released today by the government.
Retail sales edged ahead 0.3% in October compared to September of this year but rose a much stronger 5.7% compared to September of last year, according to that report.
Notably, unadjusted sales of so-called “non-store retailers” — essentially online retailers — jumped 26.3% in October compared to October of 2019, according to this report.
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Meanwhile, unadjusted sales at traditional clothing stores declined 11.3%, they fell 14.1% at restaurants and bars and unadjusted sales slipped 13.7% at gas stations in October compared to October 2019, according to the report’s estimates.
All of the above points to very specific evidence of just how much the coronavirus pandemic has completely upended the entire retail environment and how online merchants have become the beneficiaries of this disruption.
SPORTS: Quarterback Futures
The 2020 NFL season could perhaps serve as a referendum on the futures of two quarterbacks who happen to be playing against one another this Sunday.
They are Carson Wentz of the Philadelphia Eagles, who was the second overall pick in the 2017 draft, and Baker Mayfield, who was selected as the overall number one pick in the 2018 draft by the Cleveland Browns.
As both Wentz and Mayfield are top draft choices, their respective franchises are likely under some pressure to make decisions soon on whether to keep their quarterbacks for the long term.
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Both Wentz and Mayfield have struggled with consistency and decision-making throughout their careers though both currently have their respective teams in playoff contention at the moment.
The Browns have a deeper offensive roster, particularly at the skill positions, than the Eagles this year, so Mayfield has to shoulder less of the offensive burden for his team compared to Wentz.
Mayfield can rely more on his teammates, and he often just needs to play mistake free football in order for the Browns to win games. If he doesn’t play that way, Cleveland could be looking for a new starting quarterback in the next year or two.
Meanwhile, Wentz often carries his team, and his struggles can be expected. As such, I expect the Eagles to stick with him and keep Wentz as their long-term starter unless he regresses in the next couple of seasons.
Jeremy Pink currently serves as an advisor to companies in media and financial tech. He is former CEO of private-equity backed Broadcast Sports International where he helped lead the company to a successful sale and exit during his tenure there. Jeremy is also a former CNBC television executive in New York, London and Singapore.
The information contained in this communication is strictly for general informational and entertainment purposes and is not meant to be construed as financial, investment, tax, or legal advice. This communication is not a solicitation to buy or sell any securities. I am not a financial advisor or offering professional advice of any kind. Users should not act upon the content or information found within this communication without first seeking professional advice appropriate for their individual situation. Decisions based on information contained in this communication are the sole responsibility of the user, and use of this communication and its contents constitutes an explicit understanding and acceptance of the foregoing disclaimers.
(Newsletter Editor: Karina Pink)