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Hollywood faces the great contraction as economic realities bite

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As Hollywood celebrities graced the red carpet in early January, a pressing concern loomed over the glitz and glamour: Hollywood is undergoing a significant contraction.

Seventeen industry insiders, including entertainment executives, agents, and bankers, have shared their perspectives with Reuters, collectively painting a picture of a shifting landscape in the television and film industries.

From a reduced number of original series and movies to increased scrutiny of budgets and mounting pressure on cinema profits, decision-makers acknowledge that the entertainment sector is adapting to challenging economic conditions.

Notable reduction

“The great contraction is upon us,” commented one anonymous veteran television executive. “I anticipate a notable reduction in both the quantity of content and the expenditure on content.”

The ongoing contraction will be a focal point as companies like Walt Disney (DIS.N), Warner Bros Discovery (WBD.O), and Fox release their quarterly results this month.

It also sets the stage for discussions regarding potential media mergers, including recent talks of a sale between the owner of Paramount Global (PARA.O) and Skydance Media CEO David Ellison, whose studio co-produced “Top Gun: Maverick.”

Analyst TD Cowen predicted a 7% decline in broadcast and cable television advertising by the end of 2023 compared to the previous year, with Disney experiencing an 11.7% drop in total advertising, as per LSEG.

Warner Bros Discovery reported a 13% reduction in advertising during the first nine months of 2023.

Digital advertising

Traditional TV, alongside print and radio, has faced challenges due to the rise of digital advertising.

The outlook for 2024 remains unfavorable, with TD Cowen projecting another 7% decline in broadcast and cable TV ad revenue. Despite media companies expanding their digital advertising ventures, traditional TV advertising still constitutes 80% of their total advertising revenue.

Streaming services, once hailed as the future of the industry, are grappling with profitability concerns after years of extravagant spending.

As the industry enters the “third act of the streaming wars,” production spending is expected to dip below 2022 levels, signaling a shift from the previously “unsustainable” investment, according to MoffettNathanson.

Subscription fees

Most streaming platforms have increased subscription fees while offering fewer new content, raising doubts about their long-term strategies, as noted by TD Cowen.

The number of scripted series is expected to witness a significant reduction from the peak of 633 shows in 2022.

A combination of Hollywood strikes and budget constraints led to a decrease in production, resulting in only 481 U.S. series released in 2023, as reported by market research firm Ampere Analysis.

Even industry leader Netflix (NFLX.O) reduced its scripted series output by more than one-third from 2022 to 2023, according to Ampere.

Ahron Young is an award winning journalist who has covered major news events around the world. Ahron is the Managing Editor and Founder of TICKER NEWS.

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Time is running out for Biden’s death penalty abolition

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President Joe Biden is facing increasing pressure as his administration grapples with the challenge of fulfilling a key 2020 campaign promise – the abolition of the federal death penalty.

The issue has gained renewed attention as the Department of Justice reviews its policies on capital punishment.

Despite initial steps like imposing a moratorium on federal executions, the President’s commitment to a complete abolition faces hurdles in Congress and legal complexities.

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What can be learned from the AT&T outage?

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The outage lasted for several hours and impacted thousands of customers across the United States.

White House national security spokesperson John Kirby said the FBI and the Department of Homeland Security were looking into an AT&T outage that lasted for several hours and impacted thousands of customers across the United States.

AT&T said the hour-long outage to its U.S. cellphone network appeared to be the result of a technical error, not a malicious attack and that the Federal Communications Commission was in touch with the company.

Hugh Odom a former AT&T Attorney and the Founder and President of Vertical Consultants joins Veronica Dudo to discuss. #IN AMERICA TODAY #featured #telecommunications #cellphone #AT&T #AT&Toutage

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Extremism top concern for U.S. voters ahead of election

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Worries over political extremism and threats to democracy have surged to the forefront as the primary concern for U.S. voters, setting the stage for a high-stakes showdown in the upcoming November election.

The three-day Reuters Ipsos poll, which concluded on Sunday, found that 21% of respondents identified “political extremism or threats to democracy” as the nation’s most pressing issue, narrowly edging out concerns about the economy and immigration.

President Joe Biden appears to hold a slight advantage over his predecessor, Donald Trump, in addressing this issue, with 34% of respondents believing Biden has a better approach compared to 31% for Trump.

The findings underscore the deeply polarized political landscape in America, with Democrats prioritizing extremism as the top issue, while Republicans overwhelmingly focus on immigration.

Independent voters

The poll also highlights the pivotal role of independent voters, with nearly a third citing extremism as their primary concern, followed closely by immigration and the economy.

This suggests that the handling of extremism could significantly influence voter behavior in the upcoming election.

The rise of extremism as a top concern comes amid ongoing political turmoil, with Trump continuing to challenge the legitimacy of U.S. institutions and perpetuate false claims of election fraud.

His rhetoric has not only fueled division but also incited violence, as seen in the January 6, 2021, assault on the U.S. Capitol.

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