Reuters is reporting that Chris Bancroft is trying his hardest to block the proposed takeover of Dow Jones by News Corp:
Christopher Bancroft has recently approached hedge funds, private equity firms and General Electric Co. , hoping to buy enough voting shares of Dow Jones to give him the power to thwart a sale, the paper reported on its Web site, citing people familiar with the matter.
Imagine if Rupert Murdoch controlled the Wall Street Journal. Oh sure, the Bancroft family has been negotiating to retain editorial control of the newspaper, but so did the Times newspaper of London. A lot of good that did. It doesn't matter what is negotiated. If Murdoch gets his hands on the WSJ, it will start to look more like the New York Post. Yuk!
In my opinion, Murdoch only wants the WSJ as another platform to challenge the NY Times. I can't find the story online, but I remember there being a piece in which Murdoch states that he wants more NY media so that he's better equipped to shout down the NY Times. The NY Times reports the facts and sometimes those facts don't jive with the reality uber-conservatives such as Murdoch would like there to be.
Murdoch would turn the Journal into a complete joke. As it is, every story should be taken with a grain of salt. Imagine the inaccuracies if Murdoch has his way.
If you don't believe me, check this out. I can't get through the movie without yelling at the screen. Dow Jones needs to say no to Murdoch or the business community needs to find another buyer, either collectively or individually. Where's George Soros when you need him?
Showing posts with label Entertainment Industry. Show all posts
Showing posts with label Entertainment Industry. Show all posts
Sunday, July 15, 2007
Monday, July 9, 2007
Sirius and XM: Roadblocks to Common Sense
Give me one good reason why Sirius and XM should not merge. Competition? That's what the 'man' wants you to believe:
"Shortly after the merger was announced, many politicians, as well as the National Association of Broadcasters, a powerful trade organization representing the traditional radio industry, voiced their objection to the merger, arguing that a deal would be anti-competitive and hurt consumers."
How would their merger be anticompetitive? Just because they won't be competing against one another doesn't mean they wouldn't face fierce competition. iPods and podcasts, CD players, other forms of media and entertainment, and of course, terrestrial radio all serve as competition for satellite radio. But maybe that's the problem. A unified satellite radio team would definitely create MORE competition for the members of the NAB and facilitate an even greater market share shift from old to new.
"The deadline to submit public comments is July 9. So far, the National Association of Broadcasters, influential research firm the Carmel Group and seventy-three members of Congress have written letters urging the FCC and Justice Department to shoot down the merger. Meanwhile, consumer rights group Americans for Tax Reform, the Hispanic Federation and retailer Circuit City have written letters in support of the deal."
I doubt as many members of congress would have written letters had Howard Stern not made the jump from terrestrial radio to satellite. In fact, I'd bet the deal would already have been approved if not for that fact.
Economies of scale indicate that a merger of the two could lead to a reduction in the cost of operations, which could be passed on to the subscribers. Furthermore, Mel Karmazin, CEO of Sirius has pledged that if the deal were to happen, current radios would not become obsolete. The deal makes sense.
But I don't see this panning out. There are too many interests that don't want to see the two companies combine. Hopefully they will survive without each other.
Disclaimer: I am a subscriber to Sirius and staunch advocate for the merger. I haven't listened to terrestrial radio in seven months. ( Maybe this is the reason why the NAB is so scared.)
"Shortly after the merger was announced, many politicians, as well as the National Association of Broadcasters, a powerful trade organization representing the traditional radio industry, voiced their objection to the merger, arguing that a deal would be anti-competitive and hurt consumers."
How would their merger be anticompetitive? Just because they won't be competing against one another doesn't mean they wouldn't face fierce competition. iPods and podcasts, CD players, other forms of media and entertainment, and of course, terrestrial radio all serve as competition for satellite radio. But maybe that's the problem. A unified satellite radio team would definitely create MORE competition for the members of the NAB and facilitate an even greater market share shift from old to new.
"The deadline to submit public comments is July 9. So far, the National Association of Broadcasters, influential research firm the Carmel Group and seventy-three members of Congress have written letters urging the FCC and Justice Department to shoot down the merger. Meanwhile, consumer rights group Americans for Tax Reform, the Hispanic Federation and retailer Circuit City have written letters in support of the deal."
I doubt as many members of congress would have written letters had Howard Stern not made the jump from terrestrial radio to satellite. In fact, I'd bet the deal would already have been approved if not for that fact.
Economies of scale indicate that a merger of the two could lead to a reduction in the cost of operations, which could be passed on to the subscribers. Furthermore, Mel Karmazin, CEO of Sirius has pledged that if the deal were to happen, current radios would not become obsolete. The deal makes sense.
But I don't see this panning out. There are too many interests that don't want to see the two companies combine. Hopefully they will survive without each other.
Disclaimer: I am a subscriber to Sirius and staunch advocate for the merger. I haven't listened to terrestrial radio in seven months. ( Maybe this is the reason why the NAB is so scared.)
Monday, July 2, 2007
iPhone Interest
Apple iPhone sales beat most analysts expectations, but you wouldn't know it by looking at the price of their stock, which dipped below $120 before closing at $121.26. It closed trading on Friday at $122.04.
Analyst's estimates for unit sales over the weekend were volatile. David Bailey at Goldman Sachs estimates weekend sales to be near 700,000. Gene Munster of Piper Jaffray estimates that as many as 500,000 units were sold. Bill Shope at JP Morgan has one of the more conservative estimates, figuring that 312,000 units were sold:
"'We believe initial demand may have been disappointing, but it's still early,' Bill Shope, analyst at JP Morgan, said in a note to clients. 'We don't believe supply was much better than expected, so demand could be a bit light."'
This is a good point. The fact that the iPhone failed to sell out at a majority of stores means it failed to meet internal estimates, and it could be the reason for the sputtering stock price. The iPhone was most popular in California, a place where status symbols are of the utmost importance:
"Just about every Apple Store in California was out of the iPhone except for two in San Francisco. But in New York only one Apple Store, in Smith Haven Mall in Lake Grove, was reported out of the iPhone, while the other 11 stores in the state had them available, as did the 12 stores in neighboring New Jersey and Connecticut."
"we have increased our iPhone forecast to 5.25 million for calendar 2007 and 12 million for 2008, up from four million and 10.5 million, respectively."
Reaching for the stars, I guess. I think these are gross overestimates, especially if/when the consumer runs out of money and credit. Furthermore, I still believe that the lead-up to the release of the iPhone was overhyped. Apple has gained 45.6 percent since the first of the year, almost all of which was consumer expectations for the iPhone. Could it be that the frenzy Steve Jobs whipped up brought the majority of prospective iPhone buyers out this past weekend? It's quite possible that this past weekend was the exception and not the rule. This puts me at odds with most others:
"'The surge of sales to early adopters was strong, [but] we actually expect the hype to grow in the coming weeks,' said Munster, who holds an outperform rating and $160-a-share price target on Apple's stock."
As for my expectations, I followed the sheep with an estimate of about 150,000 sales for the weekend. I was wrong on that account, but right about the ill-effects the stock price would see. I stand by my prediction that the stock will retreat before significantly going up.
************************************************************************************
Edited - 9:10 PM:
I failed to notice the story about Universal Music nixing a deal with Apple's iTunes, which certainly had a negative effect on the price of the stock:
"Universal Music Group, one of the world’s largest commercial music publishers, has turned down an opportunity to continue a long-term arrangement with Apple, a source confirmed to Macworld."
I don't know the extent to which this contributed to the stock decline, but it certainly opens the doors for more iTunes problems:
"...it will give Universal some breathing room if, say, a big media company approaches them with a promising new way to distribute music digitally and wants to provide some oomph to its launch with exclusive, limited-time access to new releases from the label's hottest-selling artists."
"That would be hard to do under the kind of deals that the major music companies have signed with iTunes. Now, Apple won't have automatic access to all of Universal's music."
This opens the door for other companies in the recording industry to pursue similar arrangements with Apple. It will be interesting to see how this plays out.
Analyst's estimates for unit sales over the weekend were volatile. David Bailey at Goldman Sachs estimates weekend sales to be near 700,000. Gene Munster of Piper Jaffray estimates that as many as 500,000 units were sold. Bill Shope at JP Morgan has one of the more conservative estimates, figuring that 312,000 units were sold:
"'We believe initial demand may have been disappointing, but it's still early,' Bill Shope, analyst at JP Morgan, said in a note to clients. 'We don't believe supply was much better than expected, so demand could be a bit light."'
This is a good point. The fact that the iPhone failed to sell out at a majority of stores means it failed to meet internal estimates, and it could be the reason for the sputtering stock price. The iPhone was most popular in California, a place where status symbols are of the utmost importance:
"Just about every Apple Store in California was out of the iPhone except for two in San Francisco. But in New York only one Apple Store, in Smith Haven Mall in Lake Grove, was reported out of the iPhone, while the other 11 stores in the state had them available, as did the 12 stores in neighboring New Jersey and Connecticut."
"Seattle's University Village Apple Store reportedly had the iPhone, but the other three stores in the state were out, while in Texas, the two Apple Stores in Austin were out of the phone, as was the Dallas store, but the other nine other stores in the state had the phone."
The iPhone seems to have struck out in the highly populated New England area; nevertheless, first weekend unit sales appeared strong, double what analyst expectations were prior to Friday. Can this pace continue? From Goldman Sachs:"we have increased our iPhone forecast to 5.25 million for calendar 2007 and 12 million for 2008, up from four million and 10.5 million, respectively."
Reaching for the stars, I guess. I think these are gross overestimates, especially if/when the consumer runs out of money and credit. Furthermore, I still believe that the lead-up to the release of the iPhone was overhyped. Apple has gained 45.6 percent since the first of the year, almost all of which was consumer expectations for the iPhone. Could it be that the frenzy Steve Jobs whipped up brought the majority of prospective iPhone buyers out this past weekend? It's quite possible that this past weekend was the exception and not the rule. This puts me at odds with most others:
"'The surge of sales to early adopters was strong, [but] we actually expect the hype to grow in the coming weeks,' said Munster, who holds an outperform rating and $160-a-share price target on Apple's stock."
As for my expectations, I followed the sheep with an estimate of about 150,000 sales for the weekend. I was wrong on that account, but right about the ill-effects the stock price would see. I stand by my prediction that the stock will retreat before significantly going up.
************************************************************************************
Edited - 9:10 PM:
I failed to notice the story about Universal Music nixing a deal with Apple's iTunes, which certainly had a negative effect on the price of the stock:
"Universal Music Group, one of the world’s largest commercial music publishers, has turned down an opportunity to continue a long-term arrangement with Apple, a source confirmed to Macworld."
I don't know the extent to which this contributed to the stock decline, but it certainly opens the doors for more iTunes problems:
"...it will give Universal some breathing room if, say, a big media company approaches them with a promising new way to distribute music digitally and wants to provide some oomph to its launch with exclusive, limited-time access to new releases from the label's hottest-selling artists."
"That would be hard to do under the kind of deals that the major music companies have signed with iTunes. Now, Apple won't have automatic access to all of Universal's music."
This opens the door for other companies in the recording industry to pursue similar arrangements with Apple. It will be interesting to see how this plays out.
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