Disney-Charter Battle Makes Pay-TV Bundle’s Fadeout A Stark Reality For Streaming-Focused Media Companies And Investors: “The Lifeboats Have Already Been Burned”

Labor Day Weekend Has Been "A Frustrating One For Millions Of Spectrum Cable Subscribers," Disney Says In Latest Salvo, Adding Plug For Hulu TV Service And Rival Alternatives - Update

Bank of America analyst Jessica Reif Ehrich also sounded the alarm in a note to clients today. “If this posture were to be extrapolated across all other major video distributors, we believe it would have a devastating impact on the P&L of the entire traditional Media & Entertainment group,” she wrote. “The result would lead to a significant decline in highly profitable linear subscribers that would be only partially recouped by likely fewer and less profitable DTC subs.

The debt carried by media companies, already a worry in the cases of Warner Bros. Discovery and Paramount Global, could get even more unwieldy if cash flow from affiliate fees declines markedly, many analysts have noted. That line item represents between 20% and 47% of total revenue for media companies, so it’s not a casual matter. Charter has estimated it was projected to pay Disney $2.2 billion for carriage rights in 2023.

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Club name Disney's dispute with Charter is bad news for both companiesThe Investing Club holds its Morning Meeting every weekday at 10:20 a.m. ET.
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