Is ESPN Doomed?

[rocket surgeon]

Ok boomer

  no, it's homer

[The Hippie Satan of Hyperbole]

  no, it's homer

Not surprising.

[Not A Serious Person]

As you read this note that Disney's stock broke below its March 2020 COVID panic low. It is now at a 9 year low and anyone that has owned it over the last 35 years (Warren Buffett) is underperforming the S&P 500.


https://www.nytimes.com/2023/09/01/business/charter-disney-cable-fight.html?smid=nytcore-ios-share&referringSource=articleShare

September 2, 2023
One of the Biggest Cable Companies Says Cable TV Isn't Working

Charter Communications told investors Friday that its fraught negotiation with Disney was a sign of a larger problem with the traditional cable-TV business model.

Cable TV has become too expensive for consumers and providers, Charter Communications said in an 11-page presentation to investors on Friday, adding that cord-cutters and rising fees are contributing to a "vicious video cycle."

The presentation comes amid negotiations between Charter and the Walt Disney Company, owner of popular cable channels including ESPN and FX, which will not be available to Charter's nearly 15 million pay-TV subscribers until both sides agree on how much Charter will pay Disney to carry its channels. Subscribers to Charter's Spectrum TV service will be without access to the U.S. Open tennis tournament and college football games during a holiday weekend.
—————
But in trying to negotiate with Disney for a better deal, Charter's presentation goes a step further, delivering a scathing indictment of the cable television industry, which has generated billions of dollars for companies like itself and Disney for decades. It's a notable acknowledgment from Charter, one of the companies that propelled much of that growth.

"Customers are leaving the traditional video ecosystem, and losses have accelerated," according to Charter's presentation.

"Has the traditional TV ecosystem reached its proverbial tipping point?" said Richard Greenfield, a media analyst for LightShed Partners. "If ESPN is permanently gone from Charter, there will be a massive snowball effect that is catastrophic for traditional TV companies."

[TSmith34, Inc.]

The Heisy misleading shot at Buffett. Those poor Berkshire investors.

[Jockey]

Buffett is a liberal. Heisy attacks.

Night follows day. Ho hum.

[Not A Serious Person]

The Heisy misleading shot at Buffett. Those poor Berkshire investors.

Is there a reason your chart ended 12 years ago? 

Could it be to hide that Buffett has been "very average" for the last 12 years? I'm being charitable because he has underperformed in the period shown above (the red line up less than the blue line).

Kinda of like MJ on the Wizards.

Buffett was the greatest ever., But he has not been that since the financial crisis, especially for the period you do not show above.

And any performance he has had comes from Ajit Jain, who actually runs Bersksire's portfolio now and bails out the old man of his series of bad investments (post-2008).

[Not A Serious Person]

Buffett is a liberal. Heisy attacks.

Night follows day. Ho hum.

God, it must suck to be you. Always angry and looking for political conspiracies where none not only exist but are not even considered.

I picked Buffett because he has owned Disney continuously since 1966. DIS has performed so badly in recent years that it is lagging behind the S&P 500 over the last 35 years.

But if you want another example. How about Chicos Bail Bonds/Hoopaloop?

He famously bragged that every stock mentioned here he bought long ago and had a 300% profit in it. Given how he bragged about his investing prowess on an anonymous basketball site, he should have been a billionaire many times over.

When he left us, he said he worked for DIS and had a big chunk of his net worth in it. I'm sure if he is out there, he will regal with tales of how he turned a collapsing stock into big bucks ... even though in the original ESPN posts, he insisted I did not know what I was talking about and it was going to be a money-making juggernaut for all time.

[MU82]

Is there a reason your chart ended 12 years ago? 

Could it be to hide that Buffett has been "very average" for the last 12 years?

Actually, BRK has outperformed SPY the last 12 years, with a 423% total return to SPY's 381%.

I know that the chart you presented actually went back about 15 years, because cherry-picking dates helps folks win arguments; I only mentioned 12 years because you did.

But why are we even talking about ancient history of 15 or 12 years, anyway? Berkshire also has outperformed SPY over the past 5, 3 and 1 years.

Probably the biggest reason for that more recent outperformance? Buffett loaded up on AAPL, which is now by far Berkshire's largest holding.

https://dailytradealert.com/warren-buffett-tracker/

AAPL's total return is about 800% since Buffett started buying it in 2016 - which, if memory serves, is about when at least one expert was calling it dead money.

Look, you're far from the only one who says Buffett has "lost his fastball," and I'd agree that the 93-year-old has made far fewer great calls in recent years than he used to. (And, as you said, other Berkshire stock-pickers, led by Jain, have made most of the real good calls in recent years.)

But it was Buffett who pushed for Berkshire to invest big in AAPL because he loves the company's business model and admires Tim Cook, and he also foresaw the turnaround in the energy sector to load up on CVX and OXY. All to the benefit of BRK shareholders.

Oh, and I could be wrong (and I know you'll let me know if I am), but based on the real quick look I took, it appears BRK hasn't owned DIS for quite some time.

[Not A Serious Person]

Actually, BRK has outperformed SPY the last 12 years, with a 423% total return to SPY's 381%.

I know that the chart you presented actually went back about 15 years, because cherry-picking dates helps folks win arguments; I only mentioned 12 years because you did.

But why are we even talking about ancient history of 15 or 12 years, anyway? Berkshire also has outperformed SPY over the past 5, 3 and 1 years.

Probably the biggest reason for that more recent outperformance? Buffett loaded up on AAPL, which is now by far Berkshire's largest holding.

https://dailytradealert.com/warren-buffett-tracker/

AAPL's total return is about 800% since Buffett started buying it in 2016 - which, if memory serves, is about when at least one expert was calling it dead money.

Look, you're far from the only one who says Buffett has "lost his fastball," and I'd agree that the 93-year-old has made far fewer great calls in recent years than he used to. (And, as you said, other Berkshire stock-pickers, led by Jain, have made most of the real good calls in recent years.)

But it was Buffett who pushed for Berkshire to invest big in AAPL because he loves the company's business model and admires Tim Cook, and he also foresaw the turnaround in the energy sector to load up on CVX and OXY. All to the benefit of BRK shareholders.

Oh, and I could be wrong (and I know you'll let me know if I am), but based on the real quick look I took, it appears BRK hasn't owned DIS for quite some time.

No, I showed the missing 12 years from TSmith's chart. It shows Buffett was very average.

And what part of the red line is lower than the blue line, don't you understand?  You, of all people, know what that means.

And you make the precise argument of why he has been very average the last 15 years, because "cherry-picking" the periods matter. It should not, and it did not prior to 2008; he flat-out beat everything, no matter the period, until the financial crisis.

If we want to get into cherry-picking periods, then there are dozens, if not hundreds, of managers that are equal to him or better.

Can MJ be the best player in history if he is the 15th-highest score in the NBA? That's what we are arguing with Buffett since 2008.

And let's talk about "loading up" on energy (S&P 500 Energy is only up 3% YTD versus 17% for the S&P 500)

OXY has sucked, up 2.5% (again, the benchmark is the S&P 500, which is up 17%)
CVX is DOWN 6% YTD. Crappily-run banks are doing better than this.

But this is what Buffett idolatry does. If a mere mortal held OXY and CVX and had that 12-year track record, he would not only be out of a job, but they would bought up on charges. But when Buffett lays these turds, we all walk around talking about how great they smell.

Correct on AAPL. But that was Ajit Jain, not Buffett. His job is to "cover" for the old man.

(Again, he was the greatest ever, but he is way past his sell-by date and has not been pretty average since, and index funds have been better.)
-------------

But I will give Buffett significant props for his honesty. He knows he is past his sell-by date and tries to tell everyone, but we all want to think his crap does not smell.

He tells everyone not to buy Index funds and, by implication, not BRK.

Billionaire Warren Buffett swears by this inexpensive investing strategy that anyone can try
https://www.cnbc.com/2022/10/03/billionaire-warren-buffett-swears-by-this-inexpensive-investing-strategy-that-anyone-can-try.html

He knows what happened to him in the financial crisis. He was effectively wiped out and then bailed out by taxpayers so he could remain the second richest man (at the time, behind Gates).

He even wrote a "thank you letter" to the public for keeping him a billionaire. Anyone else would have been derided for this. But good old Uncle Warren deserves the tax payer to ensure he is always worth $100 billion.

November 17, 2010
Pretty Good for Government Work
By Warren E. Buffett

https://www.nytimes.com/2010/11/17/opinion/17buffett.html?_r=3&ref=opinion&

DEAR Uncle Sam,

My mother told me to send thank-you notes promptly. I've been remiss.

Let me remind you why I'm writing. Just over two years ago, in September 2008, our country faced an economic meltdown. Fannie Mae and Freddie Mac, the pillars that supported our mortgage system, had been forced into conservatorship. Several of our largest commercial banks were teetering. One of Wall Street's giant investment banks had gone bankrupt, and the remaining three were poised to follow. A.I.G., the world's most famous insurer, was at death's door.

Many of our largest industrial companies, dependent on commercial paper financing that had disappeared, were weeks away from exhausting their cash resources. Indeed, all of corporate America's dominoes were lined up, ready to topple at lightning speed. My own company, Berkshire Hathaway, might have been the last to fall, but that distinction provided little solace.

[Not A Serious Person]

I cannot help but think that years from now, we will look back at the latest conference realignment, with the elimination of the PAC-12 as a catastrophic mistake.

They are all chasing massive broadcasting rights fees when the broadcasters are showing they cannot make the economics work.

Or maybe they hope the tech firms (Amazon, Apple) are stupid and will grossly overpay into perpetuity. 

Hope is not a strategy.

----

September 5, 2023
ESPN's 'melting iceberg' is yet another challenge for Disney, analyst says
ESPN's outlook is negative and overinflated by the consensus view, according to KeyBanc

https://www.marketwatch.com/story/espns-melting-iceberg-is-yet-another-challenge-for-disney-analyst-says-47377bcc

Looking at the big picture, Nispel calls ESPN "a melting iceberg" that faces a difficult transition to the streaming landscape. Disney already offers the ESPN+ streaming service, but it doesn't include live access to ESPN's flagship programming. The company will ultimately have to transition the core ESPN service into a direct-to-consumer proposition.

By Nispel's math, ESPN+ delivers average revenue per user of $5.45 a month inclusive of advertising, while linear ESPN drives $16 to $17 a month on the metric.

"In other words, ESPN+ ARPUs are going to need to more than triple to match that of linear," he wrote.

[Uncle Rico]

I cannot help but think that years from now, we will look back at the latest conference realignment, with the elimination of the PAC-12 as a catastrophic mistake.

They are all chasing massive broadcasting rights fees when the broadcasters are showing they cannot make the economics work.

Or maybe they hope the tech firms (Amazon, Apple) are stupid and will grossly overpay into perpetuity. 

Hope is not a strategy.

----

September 5, 2023
ESPN's 'melting iceberg' is yet another challenge for Disney, analyst says
ESPN's outlook is negative and overinflated by the consensus view, according to KeyBanc

https://www.marketwatch.com/story/espns-melting-iceberg-is-yet-another-challenge-for-disney-analyst-says-47377bcc

Looking at the big picture, Nispel calls ESPN "a melting iceberg" that faces a difficult transition to the streaming landscape. Disney already offers the ESPN+ streaming service, but it doesn't include live access to ESPN's flagship programming. The company will ultimately have to transition the core ESPN service into a direct-to-consumer proposition.

By Nispel's math, ESPN+ delivers average revenue per user of $5.45 a month inclusive of advertising, while linear ESPN drives $16 to $17 a month on the metric.

"In other words, ESPN+ ARPUs are going to need to more than triple to match that of linear," he wrote.

Rights fees have been and will be a bubble that is going to burst for all involved at some point, except the NFL.  Those rights fees will never implode. 

[MU82]

No, I showed the missing 12 years from TSmith's chart. It shows Buffett was very average.

And what part of the red line is lower than the blue line, don't you understand?  You, of all people, know what that means.

And you make the precise argument of why he has been very average the last 15 years, because "cherry-picking" the periods matter. It should not, and it did not prior to 2008; he flat-out beat everything, no matter the period, until the financial crisis.

If we want to get into cherry-picking periods, then there are dozens, if not hundreds, of managers that are equal to him or better.

Can MJ be the best player in history if he is the 15th-highest score in the NBA? That's what we are arguing with Buffett since 2008.

And let's talk about "loading up" on energy (S&P 500 Energy is only up 3% YTD versus 17% for the S&P 500)

OXY has sucked, up 2.5% (again, the benchmark is the S&P 500, which is up 17%)
CVX is DOWN 6% YTD. Crappily-run banks are doing better than this.

But this is what Buffett idolatry does. If a mere mortal held OXY and CVX and had that 12-year track record, he would not only be out of a job, but they would bought up on charges. But when Buffett lays these turds, we all walk around talking about how great they smell.

Correct on AAPL. But that was Ajit Jain, not Buffett. His job is to "cover" for the old man.

(Again, he was the greatest ever, but he is way past his sell-by date and has not been pretty average since, and index funds have been better.)
-------------

But I will give Buffett significant props for his honesty. He knows he is past his sell-by date and tries to tell everyone, but we all want to think his crap does not smell.

He tells everyone not to buy Index funds and, by implication, not BRK.

Billionaire Warren Buffett swears by this inexpensive investing strategy that anyone can try
https://www.cnbc.com/2022/10/03/billionaire-warren-buffett-swears-by-this-inexpensive-investing-strategy-that-anyone-can-try.html

He knows what happened to him in the financial crisis. He was effectively wiped out and then bailed out by taxpayers so he could remain the second richest man (at the time, behind Gates).

He even wrote a "thank you letter" to the public for keeping him a billionaire. Anyone else would have been derided for this. But good old Uncle Warren deserves the tax payer to ensure he is always worth $100 billion.

November 17, 2010
Pretty Good for Government Work
By Warren E. Buffett

https://www.nytimes.com/2010/11/17/opinion/17buffett.html?_r=3&ref=opinion&

DEAR Uncle Sam,

My mother told me to send thank-you notes promptly. I've been remiss.

Let me remind you why I'm writing. Just over two years ago, in September 2008, our country faced an economic meltdown. Fannie Mae and Freddie Mac, the pillars that supported our mortgage system, had been forced into conservatorship. Several of our largest commercial banks were teetering. One of Wall Street's giant investment banks had gone bankrupt, and the remaining three were poised to follow. A.I.G., the world's most famous insurer, was at death's door.

Many of our largest industrial companies, dependent on commercial paper financing that had disappeared, were weeks away from exhausting their cash resources. Indeed, all of corporate America's dominoes were lined up, ready to topple at lightning speed. My own company, Berkshire Hathaway, might have been the last to fall, but that distinction provided little solace.

You have some misinformation there, including about total return over the last 12 years, but that's OK. I'm in a good mood today, so I'll let it go.

[TSmith34, Inc.]

Is there a reason your chart ended 12 years ago? 

Could it be to hide that Buffett has been "very average" for the last 12 years? I'm being charitable because he has underperformed in the period shown above (the red line up less than the blue line).

No, not intentional. User error in that I copied the chart poorly.

[Not A Serious Person]

Rights fees have been and will be a bubble that is going to burst for all involved at some point, except the NFL.  Those rights fees will never implode.

I agree NFL broadcast rights may not implode. But broadcasters can still grotesquely overpay and wind up losing a ton of money,

Consider this tweet. If true, then the NFLPA will demand a huge increase in rookie salaries.  The richest league in the world cannot have its top rookies take a pay cut when moving to the next level.

The NFLPA will strike over this.

And the league will need grotesque overpaying of broadcast fees to make their economics work.
----

https://x.com/nflrookiewatxh/status/1699131616252002326?s=12&t=uSnZlSLOtzvp-jqg6eHG4Q

Shedeur Sanders is now projected to make $3.8M through NIL this season.

That is up $2.5M dollars from before his breakout game against TCU.

Sanders' projected NIL earnings is over $2M more than Dak Prescott's base salary this season ($1,700,000).

Nearly $3M more than Joe Burrow's base salary this season ($1,010,000).

And also nearly $3M more than both Justin Herbert and Trevor Lawrence's base salaries this season ($1,010,000 and $940,000).

The Sanders name PRINTS money

[Uncle Rico]

I agree NFL broadcast rights may not implode. But broadcasters can still grotesquely overpay and wind up losing a ton of money,

Consider this tweet. If true, then the NFLPA will demand a huge increase in rookie salaries.  The richest league in the world cannot have its top rookies take a pay cut when moving to the next level.

The NFLPA will strike over this.

And the league will need grotesque overpaying of broadcast fees to make their economics work.
----

https://x.com/nflrookiewatxh/status/1699131616252002326?s=12&t=uSnZlSLOtzvp-jqg6eHG4Q

Shedeur Sanders is now projected to make $3.8M through NIL this season.

That is up $2.5M dollars from before his breakout game against TCU.

Sanders' projected NIL earnings is over $2M more than Dak Prescott's base salary this season ($1,700,000).

Nearly $3M more than Joe Burrow's base salary this season ($1,010,000).

And also nearly $3M more than both Justin Herbert and Trevor Lawrence's base salaries this season ($1,010,000 and $940,000).

The Sanders name PRINTS money

NFLPA isn't going to strike over this.  The current deal runs through 2030.  The NFLPA always caves. 

[The Hippie Satan of Hyperbole]

NFLPA isn't going to strike over this.  The current deal runs through 2030.  The NFLPA always caves. 

Not only that, but Sanders or any other rookie, has the ability to earn unlimited endorsement dollars once they enter the league already.

[Uncle Rico]

Not only that, but Sanders or any other rookie, has the ability to earn unlimited endorsement dollars once they enter the league already.

That, too.  Also, what option does he have?  Canada?  Using his degree to get another job?

[forgetful]

Not only that, but Sanders or any other rookie, has the ability to earn unlimited endorsement dollars once they enter the league already.

Can't they now sign unlimited endorsement deals in college with NIL?

[jficke13]

NFLPA isn't going to strike over this.  The current deal runs through 2030.  The NFLPA always caves.

Well that and the "base salary" of Dak Prescott isn't a very informative comparison.

"In 2023, Prescott will earn a base salary of $1,700,000 and a restructure bonus of $29,300,000"

https://www.spotrac.com/nfl/dallas-cowboys/dak-prescott-19089/

[The Hippie Satan of Hyperbole]

Can't they now sign unlimited endorsement deals in college with NIL?

Right. Heisey is claiming that the NFLPA will strike because players are going to be taking a compensation cut when going from NIL-funded college careers to a rookie wage scale. He's comparing apples to oranges because the rookie wage scale has nothing to do with earning endorsement income - like NIL.

[WhiteTrash]

Right. Heisey is claiming that the NFLPA will strike because players are going to be taking a compensation cut when going from NIL-funded college careers to a rookie wage scale. He's comparing apples to oranges because the rookie wage scale has nothing to do with earning endorsement income - like NIL.

I agree with this.

The funny aside is that much/most of NIL payments have nothing to do with endorsements; it is pure pay for play. 

[The Hippie Satan of Hyperbole]

I agree with this.

The funny aside is that much/most of NIL payments have nothing to do with endorsements; it is pure pay for play. 

Yep. Which is why this entire set up is nonsense. I know they don't want to have the players have employee status, so you have now set up this byzantine system to get money to them.

And then they complain about lack of control and want the federal government to do something about it.

[Dr. Blackheart]

Yep. Which is why this entire set up is nonsense. I know they don't want to have the players have employee status, so you have now set up this byzantine system to get money to them.

And then they complain about lack of control and want the federal government to do something about it.

It's almost the end of another summer. I am sure the NCAA is ready to throw the hammer down on Bill Self for his past transgressions (which look like small potatoes now).

[Uncle Rico]

It's almost the end of another summer. I am sure the NCAA is ready to throw the hammer down on Bill Self for his past transgressions (which look like small potatoes now).

Chicos promised the hammer would drop

[forgetful]

Right. Heisey is claiming that the NFLPA will strike because players are going to be taking a compensation cut when going from NIL-funded college careers to a rookie wage scale. He's comparing apples to oranges because the rookie wage scale has nothing to do with earning endorsement income - like NIL.

Got it. My brain is struggling a bit, and had a hard time following what Heisey is up in arms about this time and thought you were implying something different.