Tuesday, August 16, 2022

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Sun Valley draws tycoons against a backdrop of storm clouds in Deals Sky –

4th of July first. Then the sun field. After Independence Day, media and tech titans will once again travel to the Idaho resort to party at investment bank Allen & Co.’s annual meeting, dubbed “the summer camp of moguls.”

The secret and exclusive gathering of media, technology and other influencers traditionally combines presentations, discussions and social activities like hiking, rafting and golf. And it’s all about business, whether it’s first contact about a potential merger, discussions about pending or completed transactions, or meetings leading up to merger and acquisition negotiations. It has long been a hallmark of an Allen event.

This year is unlikely to be any different, even if the tone may be different from last year. For example, as CEO of Discovery, David Zaslav has been one of the media moguls who attend the annual meeting and is sought after by peers and media reporters. This week, he returns as a Hollywood titan of a sprawling empire, as CEO of Warner Bros. Discovery. He is expected to join his longtime right-hand man and business consultant Bruce Campbell, director of revenue and strategy at United Entertainment Centers.

Zaslav arrived in the city last year after brokering a mega deal with telecom giant AT&T for its entertainment arm WarnerMedia. This year, his visit follows the conclusion of a deal and moves his first ever imprint on Warner Bros. in Discovery’s corporate structure, including the departure of several top executives.

Conversations about other businesses may shift this year from finding new targets to focusing on making the most of past businesses or portfolios of existing businesses. After all, PwC noted in a recent report that “business activity has recently slowed among some of the biggest media companies, following a surge in content and technology acquisitions that are helping to expand streaming services.”

Paramount Global’s non-executive chairman Shari Redstone, who will also travel to Sun Valley, spoke recently about the scale of the CBS-Viacom merger, saying it has “what it takes to succeed” as it topped $62 million. in global broadcast. Subscribers from March.

With media and entertainment stock prices weakening amid a challenging first half of 2022 and fears that a recession will hurt companies’ ad revenue, many executives may focus more on the lockdown and adaptation needed to deal with the new uncertainty. in the short term. To do big and transformative business.

One big unfinished business that will continue to attract a lot of attention in Sun Valley this year is the planned $44 billion purchase of social media giant Twitter by Tesla and SpaceX boss Elon Musk. The fact that Musk and Twitter CEO Parag Agrawal are expected to be in town adds to the intrigue. No further intrigue was needed, as Musk tweeted in May that the Twitter deal was “temporarily on hold with details pending to support the estimate that fake/spam accounts actually represent less than 5% of users.” The social media powerhouse reported that 229 million users posted ads in the first quarter, meaning 5% of those users were 11.45 million.

This may not be the only case of strange encounters in Sun Valley. After all, Walt Disney CEO Bob Chapek, who recently signed a contract extension, is on the guest list, as is his predecessor, Bob Iger. The latter remained in the position of CEO of the company until the end of last year. After that, Chapek put his stamp on Mouse House, filling key roles held by close advisers to Iger and forging new “strategic pillars” for the conglomerate.

But the CEO’s tenure was also accompanied by some twists, including his lack of corporate response to Florida’s so-called “don’t say gay” bill that outraged workers, Florida’s decision to strip Disney of a special tax district, and the recent debate over TV CEO Peter Rice’s resignation. With that in mind, any photo or report of Chapek and Iger talking, or just together, could draw attention.

The same goes for two of Meta Platforms’ top executives: CEO Mark Zuckerberg and CEO Sheryl Sandberg, who recently announced they will step down this fall after 14 years at the company formerly known as Facebook.

Wall Street watchers expect industry bosses in Sun Valley to also discuss, whether in formal sessions or social gatherings, indoors or out, challenges such as rising inflation that could affect the direction of the industry giants in Sun Valley. After all, amid fierce competition, soaring lifestyles and the shocking decline in Netflix subscribers in the first quarter, analysts debate whether the Hollywood powerhouse’s financial and subscriber forecasts should be cut. Management teams also commented further on the disciplined approach to content budgeting.

“With the proliferation of many new direct-to-consumer services, the competitive landscape in streaming has intensified,” wrote Jessica Reif Ehrlich, an analyst at Bank of America, in a mid-June report. “This is driving significant growth in content spend (including local content) globally, as well as increases for leading services like Netflix (and most network growth for new entrants).

Source: Hollywood Reporter

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