Striking Writers Guild of America (WGA) members are picketing in front of Netflix offices, while SAG-AFTRA union has agreed to federal mediation requested by the Alliance of Motion Picture and Television Producers. However, the union has refused to extend its existing labor contract past the negotiating deadline. The media industry is facing challenges such as the decline of traditional TV, soft ad revenue, and unprofitable streaming. Netflix, with its new advertising model and crackdown on password sharing, seems to be better positioned compared to legacy media giants. Disney CEO Bob Iger has extended his contract in order to address the challenges facing the company. The introduction of cheaper, ad-supported options by services like Netflix and Disney+ may provide some growth for the industry. Netflix will be reporting its earnings soon, and investors will be interested in details about the rollout of its password sharing crackdown and the state of its ad-supported option. Legacy media companies like Paramount Global, Comcast Corp., and Warner Bros. Discovery will also be reporting earnings in the coming weeks. The industry is currently facing strikes by screen actors and writers, causing a halt in production. This is the first dual strike since 1960 and could potentially lead to a lack of fresh film and TV content. Despite the decline in pay-TV subscribers, traditional TV networks remain a source of revenue, especially for streaming services. However, the weak advertising market has been affecting traditional TV, and networks are considering options such as sales. The introduction of cheaper, ad-supported tiers by streaming services will be a significant topic this quarter. Advertising is now seen as essential for platforms to achieve profitability. The recent ruling allowing the Microsoft acquisition of Activision Blizzard to move forward may lead to more mergers and acquisitions in the media industry.
Decreased Revenue: Strikes, Declining Streaming Profits, and Sluggish Ad Sales
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