The recent announcement of a new sports joint venture by Disney, Warner Bros. Discovery, and Fox has caused a significant drop in valuations for local TV station owners, including Sinclair, TEGNA, and EW Scripps. However, EW Scripps CEO Adam Symson believes that Wall Street’s reaction to the news is excessive and that investors are overreacting.
One of the main concerns for investors is the exclusion of CBS and NBC from the new bundle of sports networks, which will include ESPN, TNT, and Fox. Symson, however, reassures that local ABC and Fox affiliates, which Scripps owns, will be included in the bundle and will be compensated for their inclusion. This means that consumers will still have access to their local news and sports from these affiliates.
Symson also argues that Wall Street is overestimating the impact of the new bundle. While CBS and NBC affiliates may be at risk without being part of the bundle, Symson believes that the new offering is not as revolutionary as it seems. He highlights that viewers who are sports enthusiasts will not be satisfied with a partial offering and would prefer to maintain their current pay TV bundle.
Comparing the new bundle to FuboTV, another sports-focused network bundle, Symson points out that FuboTV has yet to reach 2 million subscribers despite offering more sports content. Therefore, he suggests that a smaller bundle at a price of $40 or $50 per month may not attract a large audience either.
Symson acknowledges that the new joint venture could potentially boost subscriber additions if it is bundled with existing streaming services like Disney+, Hulu, and Max. However, he emphasizes that it should be viewed by investors as supportive of broadcast stations like Scripps.
In conclusion, while Wall Street reacted strongly to the news of the new sports joint venture, EW Scripps CEO Adam Symson believes that the reaction is excessive. He reassures investors that local ABC and Fox affiliates will be included in the bundle and compensated for their inclusion. He also argues that the new bundle may not be as revolutionary as it seems, as sports enthusiasts are unlikely to be satisfied with a partial offering. Symson suggests that maintaining the current pay TV bundle may still be the best option for sports fans.
