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EARNINGS SEASON: PINTEREST, TF1, & ROKU · The Media Odyssey

• Marion Ranchet: [00:00:00] Welcome to the Media Odyssey Podcast. This is Evan Shapiro. Evan Shapiro: Hi, how are you? That is Marion Ranchet. We are live. Marion Ranchet: We are. Do you know where I'm at? Evan Shapiro: Where are you? You're in a foreign land. Marion Ranchet: I am. I'm in Oman, so I'm actually nine hours ahead this time. So found a way to be even further from you than usual. Evan Shapiro: I, I think that's on purpose. But you're there on vacation, so you're giving us this time for free. Yeah? Marion Ranchet: Yeah. Well, yeah. All my time is for free for the pod. I I love it. I had a nice dinner and then, you know, we're gonna do this and then I'm gonna go have some more fun. Evan Shapiro: But you did not drink because crucially it is Ramadan and you, they do not serve alcohol this time of year where you are, correct? Marion Ranchet: Absolutely. So, no, I'm, I'm fresh. Completely fresh. Evan Shapiro: So good, fast easy, fast to those people who are amidst Ramadan. I am in my ongoing construction site, but back in my permanent residence, at least for the, I think this is the first live [00:01:00] one we've done here, or maybe it's not, but have construction around me that explains that. But we're here to talk about four, well, three companies, their earnings report and some other news as well, right? Marion Ranchet: Yeah, absolutely. I'm on vacation and then, you know, some companies are dropping, you know, news bombs on us. Evan Shapiro: That's right. Well, there's this ongoing saga between Netflix and Paramount and Disco Brothers, Warner Brothers Discovery, I like to call them. We'll talk about that at the end, just crucially, for everybody out there who's on Substack or on YouTube or on LinkedIn, thank you very, very much for joining. For those of you who are gonna be in the UK next week, on Tuesday, I'll be giving a keynote. It's a version of what I just did at Nappy the larger, what the fuck to do right now, change or die presentation very specific to the UK with data from Barb and GWI and a whole bunch of other sources there. So that's Tuesday afternoon, just before cocktails. Also, since Marion is not coming to London for MIP [00:02:00] London, I will be having a different co-host on the live podcast, live on stage at MIP London. Martin Tricky. I'm cheating on you again, Martin. Tricky. Who is the really, the, the engine behind zoo 55, which is the new digital company that's a year old from ITV studios, he's gonna be my special cohost, and I hope he is gonna be breaking some news with me. I'm not sure. I'm trying to convince him to break some news with me there, but he'll, he'll be sitting in your seat in London at the Savoy. Marion Ranchet: That's okay. That's a great choice. I love I love Martin and the team at Zoo 55, so that's okay. You'll get a pass. Yeah, you'll get a pass on that one. Evan Shapiro: And we're gonna be, look, he's got some really interesting stuff going on there and that they are the, the new digital studio of ITV. So some really fascinating stuff that they're gonna be able to take us through. So here we are. We're talking about four companies. Where do you wanna start? Your choice. You're, you're, you're dialing in from vacations. It's really your choice, right? Marion Ranchet: My choice. My choice. Let me have you work and pull up some data on Pinterest, and I'd love to have your read, because [00:03:00] I have to say, it's not necessarily a company I know much of. I, I do do mood boards but you know, I think I underestimate this company a bit big time, so I wanna know more. Evan Shapiro: So Pinterest, I mean, it's, it's one of the largest social media platforms on the, on the planet. It is very much, it has video, but it's primarily visual and other kind of to your point, mood boardy type of stuff. They've really gotten into shopping as part of their enterprise, but I don't think it's growing necessarily at the pace they had anticipated it might. What's fascinating about this company in particular is them as a microcosm of the larger advertising economy. Which is interesting. One. On the revenue side, they're up 16%. And this is for all of 2025. This was a good story and monthly average users, they were up 12% year on year in the quarter, which means for the year. So they're growing at a decent pace, their net income was down, but to a certain extent, and this is where [00:04:00] the timing of things really can help confuse earnings reports. Last year at this time, there were taking it some kind of tax credit that improved their net income dramatically and not sustainably. It wasn't part of their general business operations. So compared to that, they're worse off. That said, their, their guidance for the year was not strong and their sales in fourth quarter was, were good, but not off the charts compared to meta and TikTok in particular. And so what I think you're seeing, and if you remember this when we did Google's earnings, they're one dark spot was the fact that YouTube didn't meet expectations and they didn't grow by double digits in fourth quarter. What happened to YouTube in fourth quarter and what happened to Pinterest in fourth quarter and I think is happening more and more, is they're losing their their share of social media growth, which is still astronomical to Meta and TikTok. If you're on mobile, you're just [00:05:00] losing to Meta and TikTok. Period. They, they truly, especially in the US, TikTok is stronger in the US than they are in some other territories. But in the US in particular and more globally, those two are crushing it on, on on mobile and in social media. You're losing to the combination of TikTok, meta, YouTube, and Amazon for retail media. And I just don't think Pinterest has the scale to keep up. Marion Ranchet: Interesting. So yeah, I have to say, I don't think I understand this business. I wouldn't have qualified it as a social media platform for some reason. But I get that. What was interesting was they made an acquisition at the end of last year buying company called TV Scientific which is, you know, a company operating in CTV advertising. And I think the play there. But you know, correct me if I'm wrong, is I'm understanding there's a lot of e-commerce, you know shoppable data that they can actually activate. And I'm [00:06:00] thinking that this is, this is, this is the move what with it, with TV scientific, and that could be their way. We spoke about that at length, their way of making a move to the big screen too. Well, I have to say, I'm not sure how you do mood boards and stuff, you know, on your big screen tv, but, you know, hey, people are gonna start watching vertical videos on big screen TV as well, so who knows what happens. Evan Shapiro: Yeah, I mean, you captured their problem. So first of all really social media is if it's mostly an advertising product, traditionally it's social media in a digital space specifically when it looks like Pinterest. In particular though, all of these spaces have gotten very good at direct attribution sales. Now one click sales from the comments section or from wherever on the platform itself. Pinterest hasn't been proven to really drive that kind of direct transaction. What happens, and this is in a lot of the reporting on their earnings yesterday, and it's why their stock is down 14%, I [00:07:00] think, since, since their earnings? Yeah. 14% in the last five days. Is that they're not being able to kind of push people direct to purchase. People shop here and then they go somewhere else like Amazon or even Facebook or TikTok to close the transaction and, and they're proving to not really be able to close the deal as it were. Which is fascinating 'cause there is a lot of shopping, there's a lot of window shopping happening on Pinterest. Their, their user base is skyrocketing. It's up 12% year on year. So it's just not proving to be as good a direct attributable sales engine. And that's where they're losing to Amazon, Meta, and TikTok in particular. Marion Ranchet: Yeah, they could use a proper market marketplace operating in a background. I'm, I'm, I'm guessing, Evan Shapiro: yeah. That, that, and they probably could be, be used to be acquired at this point. I just don't think they're gonna be able to, the same way traditional media is having hard time competing with Netflix and YouTube, traditional social media is having a hard time competing with these super mega companies, Meta, [00:08:00] Bytedance, and especially Amazon and Google, I think. Alright. You wanna move on to the next one? Marion Ranchet: Yeah, I wanna move. Well, let's, let's do Roku. Evan Shapiro: Okay. Marion Ranchet: Let's do Roku. I think, you know, you've, sorry about that. You've, you've written about it you know, just a few hours ago saying that they were not good, you know, at telling a story. And it is true that when you look at the earnings, it is very bland. Whereas you, the way Netflix does it, they, they find a way to wrap it up, you know, with a nice bow. Roku doesn't have that. I think there's a few reasons for that. Let's be honest. At the core, this is a company built by an engineer. And you know, the first few 500 folks were actually only engineers. So it is, you know. Evan Shapiro: It's a very nerdy, it's a very nerdy culture. Marion Ranchet: Yes, you're right. It's a nerdy CEO. It is a nerdy culture. When I joined, it was back in 2019. At the time. Most of the staff was still very much, you know, engineer focused, and then, you know, [00:09:00] the Madison Avenue people came on and the content people like me and et cetera, et cetera. And that's when, and we'll speak to that, that's a time where, you know, they pivot pivoted very hard to not be just an adware business, but an adware and platform business. But do you wanna, do you wanna, you know, comment on some key elements, results, and then I wanna give you a bit of, you know, my read on it all as well. Evan Shapiro: I would love your live read on this because you have a completely different point of view than, than I do. I think to continue the evolution story that you started. So in 2014, they pivoted from just selling devices into really platform Equal, but then platform first. Yeah. And what what happened was it took a long time for that business to really click in the way that they wanted it to. 2021, which was their first profitable full year, really was an anomaly because they sold good a bajillion devices. This chart very much tells the acceleration of CTV usage on the planet Earth because of COVID. Marion Ranchet: Yeah. Evan Shapiro: [00:10:00] 2021, they sold more devices than they ever thought they would in 2021. And the acceleration of usage of Roku and all other CTV happened as a result, it would've happened anyway. But it happened five years faster because of COVID. Marion Ranchet: Yeah. Evan Shapiro: But then there you can see their platform first business of Roku channel ad sales. And taking a piece of business done on their platform and selling ads on platform, it's taken a while to pay off, right? They have not been profitable. They were profitable for a couple quarters in 2024, but last year was the full first full year that they were profitable for a full calendar and fiscal year. What's fascinating is up until the last couple of years, and this is where I'm gonna hand it off to you, it's been primarily advertising that's been driving their growth on the platform business. But in the last 18 months, that's really shifted to a nice mix of advertising and subscription revenues and[00:11:00] according to their own report, which was unusually braggadocious for them, they're very proud of their subscription business, which is, which was really the difference in driving them to profit, the dual revenue stream on the platform side. So I'd love to hear your take. Marion Ranchet: Yeah. Before I do that, do you know, so I see that your you know, checking stocks, do, do you know how much the stock was in 2021 during that high? Evan Shapiro: It was at $50 billion valuation, and it was at that point, I think I screamed out loud, please sell that company and take your money off the table. It's not worth a fraction of that. Let's put it that way. Marion Ranchet: It was like 500 a stock and we're, and it's been under 104. 13 billion. Evan Shapiro: 13 billion today. Marion Ranchet: Yeah. So. I won't say more. But that was that time when, you know, everyone thought that the pandemic would last forever and they were riding that high. And then there's been that correction, right? Where, you know, people, you know, got out and started having a life again [00:12:00] and, and you know, less buying TVs and acoustics and spending hours and hours watching tv. Although, you know, they still manage to grow the viewing hours year on year. I think we're still talking, you know double digits this year, if I'm not mistaken. So speaking of Roku, a few things. So yes, hardware company, if you look at the business right now, they made that change because, you know. The hardware business is, we all know this, low margin. And if you look at, you know, how much they made this year, we're looking at a half, half a billion, right? In comparison to over 4.5 if I'm not mistaken on the, on the platform sites. And so, they've grown. This is now, hardware is now like 12, 13% of the overall pie. Can you, can you just like imagine this, when they started in 07, 06, they were the first ones to put Netflix on tv. They were focused on those stick, then they launched TVs and then they spend those few years focused on that. But I think they knew, they saw it [00:13:00] coming and even before. Then a lot of other TV manufacturers or TV OS and made that move that you were saying to to Ad-supported and the platform business last year, they bought a Frndly TV. So for those who are not in the states it's a virtual MVPD. It's a skinny bun, skinny, skinny bundle. Right. Would that be fair? Evan Shapiro: Yeah. Yep. Marion Ranchet: So, you know, essentially just like a small package of channel, instead of having that big fat cha cable, cable package with tons of channels, just like a small bundle, very, you know very cheap. They've also launched Howdy, which is their own last year. But above all, all of this is working Evan Shapiro: In English, that, that's howdy. Marion Ranchet: Yes, I know. I don't pronounce it the right way. I know. And you know why? Evan Shapiro: I didn't want people to mistake it for Audi, the car company, but it's, it's Marion Ranchet: Howdy. No, no, no, no. It's Howdy. Howdy fella. Yeah. Something like, yeah. Well, so that's because he is a, I [00:14:00] think he's, he has a ranch and he, he loves, he loves all of that. Yeah. So I think that's the background behind that name. But anyway, so they, they bought Frndly TV, they got Howdy, but all of that again is, you know, feeding into the Roku channel. And like you were saying, it, it used to be AVOD only. So they had like 70K AVOD titles, just like Tubi and others. Then they included FASt. They have over 400 FAST channels but something that people do not see and they don't pay attention to it. It's because they mistake it with the rest of their app business, right? When you go on a Roku device, you have the apps from Netflix and the likes, et cetera. But within the Roku channel, which is their own app which is very native in the way that you see it on screen, et cetera. You have AVOD, FAST, but you have premium subscriptions. And those premium subscriptions. If I have to find, you know, an easy comparison, it's Amazon channels. So you have HBO max, you know AMC and the likes. You have exactly 72 premium [00:15:00] subscriptions where you can actually subscribe directly via Roku. So it's a marketplace, and this is, they've said it and they've spoken to it at length to the last week in their earnings on TV, et cetera. This is becoming a massive business for them. So a few weeks ago, I was saying, let's stop thinking of the Roku Channel as just this ad-supported Play. It's important for people to understand it is also a premium subscription play, and that matters because not everyone has the brand, nor the content, nor the money. To be surfaced on Roku devices just like Netflix and others. And therefore, for a lot of people it makes more sense to be a branded corner within the Roku channel and leave Roku to actually drive traffic than trying to make it on the, on the standalone basis. So that's, that was it. Evan Shapiro: Yeah. And, and, and when you look at Roku, what's impressive about the Roku business at this point is, you're exactly right. First of all, and you said [00:16:00] this before, I think it was known in the marketplace, maybe before they knew it as well, was that they were gonna need subscription to make this model work. And 2025 is the year that proved that to be true. What's impressive about where they've gotten in the last five years is this is competing against Samsung, who's now veering on a trillion dollar company. Apple, who's a 4 trillion company Google, who's a $4 trillion company. Amazon, who's a $3 trillion company. Walmart now who's a trillion dollar company. This is a $13 billion market cap, obviously, I think undervalued at at that. And they represent 50% of the US connected television market. They're 3x the next closest competitor in the US for access to the consumer on connected television, which is remarkable. They're gonna cross a hundred million active homes, and that's a very, very attractive set of homes. It's all higher income than the norm on the planet Earth. Heavy television usage [00:17:00] homes, primarily in North America and the United States, the biggest television market in the world. So it's a really amazing platform and they've done great things with it. I do think it begs the question, what happens now with Samsung at a trillion dollar valuation, Walmart having just ingested Vizio? I don't know that they know exactly what the fuck they're doing with that thing over there, to be blunt LG hang, you know, there's a ton of other companies in this space. Yeah. Roku, I think is gonna start to approach. Its, its its premium valuation where it belongs. Does Anthony finally trade out? I mean, he's been offered, I'm sure he has. Does someone come along like a Microsoft or an Apple and finally take Roku outta the marketplace? What do you think about that? I think you probably have a better idea than I do. Marion Ranchet: Yeah, I had Apple buying Roku, who I've said that a few times. I mentioned Microsoft as well did not happen. I think the one thing I will say, so, you know, you've said it, I work there. But you know, I have to be honest at the same time, is that where they're [00:18:00] missing the boats and where I see a limitation to what they're doing is that yes, they're number one in the US They make the same claim in Canada and Mexico. They're doing great in Brazil, but this is all, you know. North and south you know, America. Beyond that, they've made plays in Europe. And that's where I came in at the time I was working across their European footprints. But I think, I think they came too late and they came with, you know a business model and a mindset that was not, you know, in line with what was needed in the region. The reason being that LG, Samsung, and others had been in those markets, you know for years. Years Evan Shapiro: For a long time. Yeah. Marion Ranchet: Samsung has over 60 million active devices within, within the region. Right. So LG, Evan Shapiro: it's very difficult. It's, it's very difficult to, to program the Roku language. And so it's a, there's a cost center to having Roku on your television if you, and at the time when they tried to invade Europe, they didn't make TVs, [00:19:00] so it was not, it was a different time. But I think what they, I think. Unless I'm reading it wrong, I think Roku has said, all right, we're not gonna own Europe and we're not gonna own Asia. Which, it's just too heavy a lift there. We're gonna make the most of the US and the markets that we're in, and they're crushing it. I mean, from a revenue standpoint, you know, they'll cross the, the five and a half billion dollars revenue this year. Their guidance was very, very strong. But I think to your point, the maximum revenue is to create a worldwide enterprise with this as kind of the, the heartbeat of it. You could see a micro, I've been saying Microsoft doing this for years. 'cause they have the money to go into these other markets and take on Google and take on Amazon and take on Samsung, all trillion dollar companies. Anyway, we'll keep a, keep an eye on this space. Let's move on to our last company because it's something, again, you are much more of an expert in than I am, which is TF1. Marion Ranchet: And I wanna go quickly. I wanna go quickly. Yeah. But I [00:20:00] thought it was worth, you know, mentioning because it's essentially the first podcasters in Europe to share their earnings. And we're gonna have, you know the ITV and the RTL of the world coming after, but I think we're gonna get a similar story every time. And so before we wrap up this season, I think it's, it matters what we're seeing. No surprise, you know linear advertising is actually going down and whatever efforts they're putting onto digital and streaming, yes, you know, it is massive growth and what you're seeing that 35.8%, this is TF1 plus, which is the streaming hub of TF1 that they've relaunched really two years ago. This is growing, but you know, not as fast as they would want or from a small base, and it's not compensating yet for what's happening on the linear ad market. So. We're gonna have exactly the same story with others. They're all gonna be sharing their [00:21:00] 2025 numbers, and I'm afraid they're all gonna be pretty much saying the same thing, you know, decreasing on the traditional linear advertising and growing on the outside. The question is, you know, will you know streaming eventually be able to compensate or are we gonna see, you know an acceleration of the decrease on, on the ad side and, you know, it just does this, but you know. There's never, there's never compensation the way it should be, right? And overall, all of those companies are spending a lot of money and a lot of efforts, you know, in pushing and pushing hard. But, you know, it's hard because it's a full transformation of their businesses. And a lot of those advertisers that they have on traditional TV, not so easy to bring them, you know on digital. More importantly, historically it's been big, big advertisers, and so it's the, the question for a lot of these guys is how do you make it easy for SMBs to buy you? And so this is what they [00:22:00] have to fix and notes that they do that at a local level, not at a global level like a YouTube and others and Meta are doing, right. So very hard to compete on a, on a global scale. Evan Shapiro: And, and what's interesting is, so you bring the ITV example in here. Both ITV and TF1 have major events occurring this year, most likely that will dramatically either test or change the way that they're doing business. So I think what's fascinating is you look at this 36% growth in streaming revenue here, which is I think a combination of both subscription and advertising. And this year they let, they announced this last year, but this year is the launch of the TF1 Netflix partnership, which is going to bring their whole programming suite right to the Netflix user, which is a younger user very vibrant user. They, you know, TF1 broadcast and, and streaming together is larger than Netflix, but Netflix's streaming is much larger [00:23:00] than TF1's in France. So you're gonna add all this audience, you're gonna add all this reach. And to your point, that's a very attractive marriage for an advertiser, no? Marion Ranchet: It's a very attractive marriage. Yeah, absolutely. And it's said that TF1 will sell against, its not Netflix because let's say one thing you, you like to say that, you know, Netflix and a few others suck at advertising. Evan Shapiro: They're terrible at selling at, they're terrible at it. They're atrocious, and they must be even worse in France. Marion Ranchet: I dunno about that. I can, I can't speak to that. But what I've noticed is that across Europe most new players, whether you're talking streamers, whether you're talking FAST Services. I'm thinking Samsung TV plus. Samsung TV plus uses TF1 as an ad Sales house. HBO Max is using Canal+. Evan Shapiro: Make my point. Marion Ranchet: So all of these guys. Yeah. They're using the strong, you know, local, traditional media players to, to sell the advertising. Right. Evan Shapiro: And selling advertising is almost impossible from a global scale. You [00:24:00] have to do it locally. I can't imagine TF1, I'm, I'm sure part of Netflix's attraction to that deal was TF1 selling the inventory to be blunt. Drop your questions by the way. Whatever platform, Substack, LinkedIn, YouTube that you're watching on, please drop your questions in the chat. We'll answer them right away. So, you know, so the other thing I was gonna say is ITV also has a major event happening this year, which is likely selling to Comcast and Sky. And when you look at that market, it's a very similar play. So here you take two of the strongest streamers in France, you add them together to sell the inventory against a younger demographic. In the UK if ITV and Sky combined, they become number two only to BBC. They leapfrog over YouTube, they leapfrog over, like both of them are, are having their own issues now, but they leapfrog over everybody else. Yeah. With regards to inventory and reach. So I think it's very interesting that both of these decisions, both of [00:25:00] these weird combinations. Kind of out of the blue to a certain extent before the fourth quarter of last year, or for second half of last year are all about the ad dollars in Europe. Marion Ranchet: Yeah, so I have to say that when, when you look at Sky and ITV, 'cause something that's not in here, but because it's the nitty gritty, but Studio TF1, which is the equivalent of, you know, ITV Studios, so the. Studio arm of TF1 grew 9%. They've made acquisition and acquisition in the us and so, you know, splitting again, it's this thing about splitting, you know, and putting linear in one bucket and then the rest somewhere else. I'm, you know, I'm dubious, I'm wondering right. I get the Move by Sky. We spoke to it. They wanna be across pay and, and free, and they're a very strong ad sales house on their own. So they are, they're gonna be, what, 70% of the ad market in the UK with this combination. But again, you know, it's about taking an asset that on its own is struggling, right? I think ITV [00:26:00] was minus 8% last year. Right? So and a lot of the predictions for this year said that it's gonna be around three to five. It's gonna be mitigated by, you know, the World Cup and right now we have the Olympics, et cetera. But it's still, you know, a struggling, you know, business. So I still don't really understand this, this need for, you know, splitting. You know, I, I, I like my flywheel. I don't really like the splitting, but anyway, it is what it is. I don't have a vote. Evan Shapiro: Well, I think, well, I, we'll see a testament. I would argue that there's a certain extent of same plus, same doesn't equal more. And we can see Disco Bros is an example of that. My argument against Netflix, and let's actually go to that and, and close things out. The conversation beyond stocks and earnings this week was very much around the ongoing saga of Netflix and Paramount bidding now, and it's really a bidding war at this point now because what Warner Brothers has opened that thing up, there's a vote in the middle of March on the Netflix deal itself. Netflix has given an ultimatum of a week for Paramount to get their [00:27:00] last best offer in, but it's an open bidding war at this point. And it, the, I think there's something that continues to be overlooked out in the open, but does get discussed behind closed doors, which is the freeze. The freezing effect on buying stuff and making progress and investing in business that this has on the entire ecosystem. These three companies are kind of frozen in place until this figures out they influence. I mean, paramount owns Channel five. Marion Ranchet: Yeah, Evan Shapiro Warner Brothers is launching stuff launching HBO Max in Europe right now. It's not stopping them. It's gonna, it would be very different if they were not going to be a different company in six to 12 months. Netflix is wholly focused on this now, testifying on the hill, et cetera, et cetera, et cetera. So I, I think this is, this is not only a saga that isn't over, which I, I said it wouldn't be, and we'll continue all year, but I don't know if [00:28:00] you sense this as well to my, to my mind or my reading, it's really created a freeze on the industry that's really dangerous at this moment in time. Marion Ranchet: Well, yeah, they say it's not, I, I will say one thing is that I kind of trust Netflix on being able to keep at it, but I'm looking at Paramount and they are just, you know, figuring out just this Skydance Paramount mergers, right? So I, I don't understand this focus. If I were shareholders you know, a shareholder on the Parliament side, I'll be like, dude, you know, focus. You need to integrate. It takes 12 to 18 months. You need to focus on putting, they've put the, the right people. They need to give those people the strategy when they do that, I mean, it's just like, you know, TBC all the time. People still do their business, but it is affecting, clearly it's affecting morale, especially on the, on our business side. People are struggling. They don't know right. What's gonna happen? Evan Shapiro: Well least their shares are working. Marion Ranchet: Well, I, yeah, [00:29:00] but not, not everyone there has a share. Evan Shapiro: Yeah, yeah, Marion Ranchet: yeah. But not every staff has one you know? It is. Huh? The people who are doing the tough grunt work every day, perhaps they don't get any of those. Right. So I agree with you. It's a bit of a free spirit. I, I have to say, I don't know if it impacts the creative community, yet I'm assuming people still go shop their programs and their projects, but Evan Shapiro: Yeah, but my, my sense is that in an industry that was already, I mean, remember each one of these groups is, has made major expenditures on sports. Let's put Warner Brothers aside for a second. Netflix has been putting so much money on sports and live. Paramount keeps putting more and more money into live in sports. And so money's being taken away from entertainment programming already as a result. And then it, there's a real freeze happening at these companies with regards to major expenditures on new IP unless it's kind of, you know, undeniable. So yes, it's really having an effect on buying [00:30:00] in the marketplace. Purchases of, of programming Film and TV last year were down 15% globally last year. A question here from Ben Grad. Marion Ranchet: Oh. Yeah. He wants to know about the TF1 deal. Yeah, the impact. So I think people were. Evan Shapiro: Hi Ben. Marion Ranchet: Hi Ben. I think, you know, it remains to be seen. A lot of people are saying, you know, what are you doing? You know, you are giving yourself away to Netflix. You know, they're gonna eat you alive, you are gonna dilute your brand, et cetera, et cetera. But I've, I've been speaking to a lot of people and they're saying people who are watching Netflix are not watching TF1 nor necessarily using TF1 Plus. So they really see this as, you know, an incremental play, the new audiences that they would not capture anyway. And as you know, like all the other podcasters across Europe, and I'm assuming across the world, they're keen on topic and tapping into that younger demos that streamers have. Remains to be [00:31:00] seen what the actual you know, look and feel this has, will we see the brand? You know, how will that work? But I think, you know, ultimately. They don't have the choice podcasters France TV went to Amazon M6 did the same. Right? They have to try, you know, I'm, I, I don't know what's gonna happen. I, I don't have a, you know, a, a crystal ball, but I think they have to get out of their own way and go see what's, what's out there. Instead of being too afraid and getting stuck in, I have my thing, I just wanna grow my thing and I'm gonna bring everyone into my thing. I think it's going to be And or so, yes, you can watch TF1. You can go on TF1 Plus it needs to be, as, you know, hyper distributed as you know they can. And why not try, you know, why not try Netflix? It's interesting to see that TF1 so far is the only major broadcaster who did not do this similar Amazon deal, meaning that M6, what they did is that they. Evan Shapiro: They [00:32:00] went to in Netflix instead. Marion Ranchet: Yeah, yeah, yeah. So I guess there's some sort of exclusivity. Is that the right thing to do? Again, you know, kind of question mark, but you know, I'm excited. It's, it's set to be launching in June, just ahead of the summer. Yeah, right. Let's see what it does. Evan Shapiro: I would give a different perspective on the global take on it, which is in my mind, the TF1 deal, and I said this at the time. And now, especially since September and the bidding war on Warner Brothers Discovery, or as I like to call them, Disco Bros. You know, to, to be honest with you, I think it, it's just a proof that Netflix is out of ideas. They are basically saying we can't really make the ad business work in France unless a TF1 really kind of takes over our daily programming to a certain extent. And our ad sales. So they're farming basically the entire enterprise out France, at least by my estimation. And now they're admitting with Warner Brothers Discovery, AKA Disco Bros. We can't make franchises. We [00:33:00] accidentally stumbled into one with K-Pop Demon Hunters. We haven't had a real franchise since Stranger Things otherwise, and frankly, the business model begins to not make sense. Unless we can just basically turn into the good old fashioned television, but really the $84 billion in debt to do it is just, it shows like that. They're, they're almost desperately grasping at a foundation that isn't necessarily there. That's, that's, that's what I see here. And, and this chart, the, the market seems to agree with me. They're down almost $200 billion in market capitalization since they started irrationally bidding. Marion Ranchet: Well, it's, it's kind of out of tune for Netflix, right? They've never bought anything. So I'm thinking that the shareholders are not used to that type of move. I agree with you. I, I'm agreeing more and more with you o n, you know, the lack of ideas. And so, yeah. Yesterday I listened to The Town Amazing podcast with Matt Belloni. [00:34:00] He had Sarandos on and he said, quote, we don't need Warner Bros, it's an accelerator. Is it? I dunno, you're gonna spend Evan Shapiro: 84 billion accelerator, that's gonna put, sorry, an 82 billion accelerator that's gonna put you $85 billion in debt? Marion Ranchet: Yeah. And then 18 months of integration. So, I don't know. Evan Shapiro: Ted also said that Ted Sarandos also said that YouTube is just for wasting time. While he was out there signing Jake Paul, Ms. Rachel, and Sideman and every other YouTuber he could find, he also said they'd never do ads. They do ads. They also said they'd never do sports. Yeah, they do sports. So they, as you said earlier, they're great at spin. They're terrific at spin. They're also a very well built company. They're the best premium television channel on the face of the earth. No second place. Right? Marion Ranchet: Yeah. Evan Shapiro: But they, their innovation cycle, just like Apple's has plateaued, and this, to me, this, this mathematically impossible bid for Warner Brothers Discovery [00:35:00] is, is a signal of that. Anyway, we should wrap up there. Marion Ranchet: I have, I have, I just have one thing. I have a game. Yeah. Which is you are saying. They should run. I saw your video. Run, run, run. Evan Shapiro: Run, Ted run. Marion Ranchet: I wanna play a game. If they were to buy something else, what should it be? Evan Shapiro: Spotify. Marion Ranchet: I want folks in the audience to chime in. Okay. You are saying Spotify. I'm saying Roku. Evan Shapiro: Oh. That's weird because Roku started, Roku started inside Netflix. Not that many people know that. Marion Ranchet: Yeah. Evan Shapiro: No, no, absolutely. That would be a ironic twist. Alright, we'll talk about that next time. Put in the notes of this chat if you're watching this on demand. Put put in what you think Netflix should do with their $85 billion instead of Buy Warner Brothers Discovery look for me at MIP London. My keynote and a podcast with Martin Trickey also. Marion and I are both going to Lisbon in April. We want you to join us. We'll be there for stream [00:36:00] TV Europe in Lisbon. April 13th through 15th there's a special code, Jesse I think it's called, what is it? SME 10. Marion Ranchet: SME 10 Streaming made easy. Evan Shapiro: SME 10, sorry, SSME 10. Marion Ranchet: It's my code. Evan Shapiro: It's your code. Wanna takes 10%. Takes 10% off. We've got amazing programming there. We've got a Eurovision panel. We've got a ITV panel about Love Island. We've got an a YouTube panel. Great stuff, great speakers, great business being done there. See you there. And we have one more live less left in earning season. Not next Thursday. Next Friday at 11. At 11:00 AM Eastern 8:00 AM Pacific, 4:00 PM Greenwich Mean Time, because we're waiting until Friday so we can have Paramount and Warner Brothers Discoveries earnings from Thursday, so next Friday live 11 Eastern. We're gonna be doing Nepo babies and Disco [00:37:00] Brothers earnings season. So we hope to see you there.