Quarterly Quotes Q3 2019 Featuring Companies Like WarnerMedia, Twitter, Viacom, CBS, Snap, Dentsu, Omnicom and Many More

By Wall St. Speaks Out Archives
Cover image for  article: Quarterly Quotes Q3 2019 Featuring Companies Like WarnerMedia, Twitter, Viacom, CBS, Snap, Dentsu, Omnicom and Many More

MediaVillage’s Wall St. Report is happy to provide you with “Quarterly Quotes” for Q3 2019. Quarterly Quotes is a curation of the top insights and forward-looking strategic views taken directly from the earnings calls from major publicly traded media and advertising agency companies. Our intent is for this report to save you significant time from having to comb through every single company’s report, while enabling you to better understand the current advertising and media ecosystem directly from the mouths of the most influential and powerful executives in the media and advertising agency world.  The insights provided during the Quarterly Earnings calls, in particular during the Q&A periods, in response to Wall Street analyst questions, present a unique opportunity to get a solid perspective of what these companies primary focus will be in the near term and, perhaps more importantly, a glimpse into the rationale and the way of thinking that is driving each company’s priority.

Insights from Q3 2019 reflect the views immediately prior to the start of what will likely be a tectonic shift in the media industry with the roll-out of several high-profile direct to consumer over-the-top plays. AppleTV+ and Disney+ have rolled out with several other high-profile players, including NBCU’s Peacock and AT&T’s HBO Max, in the coming months.  Disney+ has surpassed expectations with over 24MM subscribers reportedly signed up as of this week.  The impact of this unprecedented time is a recurring theme throughout the calls. General economic conditions also play a recurring theme with varying degrees of opinions as to whether or not 2020 will be a slowdown. In the agency world, the topics of in-housing and progress in both data platforms and client development continue to be the focus.

We wish you and your loved ones a wonderful holiday season and much success and prosperity in 2020.






MDC Partners


Media Companies



Warner Media Investment Day


Comcast - NBCU








Outfront Media







Summary:Omnicom is still very focused on their digital data audience platform, "Omni." Not raising any major alarm bells about the economy impacting in the short term. Omnicom's PR firms seem to be a drag on revenue currently. While Omnicom has downplayed the impact of in-housing, it remains a hot industry topic overall.

Global Growth:

  • U.S.: +2.7 percent
  • Canada: +2.7 percent
  • U.K: +3 percent
  • Asia Pac: +.4 percent (India, Japan, and New Zealand had doubledigit growth, Australia and China were negative in the quarter)
  • Euro: Italy, the Netherlands, and Spain performed well. France had negative growth due to loss of a specialty print production client and event business difficulties.
  • NonEuro: Czech Republic, Poland, and Russia did well.
  • Latin America: +6.6 percent
  • Middle East/Africa: 4.5 percent, primarily due to S. Africa

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote:

"Turning to our organic growth by discipline, advertising and media was up 3.4%. Healthcare had another very strong quarter with growth of 9.5 percent." – John Wren, CEO


"In the third quarter, Omnicom Precision Marketing Group, which manages our CRM and digital agencies, acquired a majority stake in Smart Digital. Smart Digital services and technology platforms are used to deliver large-scale, real time personalization solutions that enable individual brand experiences and increase loyalty across all consumer touch points.

"Smart Digital follows on the heels of the group's acquisition of Credera. Credera overlays management consulting and digital transformation on top of existing CRM and digital offerings. In a little more than a year, Credera has helped us forge stronger relationships and partnerships with many of our multinational clients.

"Per Forrester (regarding Omnicom's data platform Omni), '"When comparing data and technology platforms across the various holding companies, the report states that the Omni platform offers the most creative integration of agency platforms. It cannot be achieved simply by buying legacy data platforms that weren't built with the flexibility required to meet the rapidly changing demands of today's marketers.'

"To date, we have scaled Omni by training over 4,000 employees worldwide.... As Forrester eloquently stated in its report, it's a combination of humans and machines that will give CMOs the data-driven execution they desire and agencies the new capabilities they need to remain relevant.

"In the third quarter, we deepened and expanded our existing engagements with some of the largest clients, including AstraZeneca, Novartis, Wells Fargo, and Unilever. We also won several new client engagements from world class marketers during the quarter. Kroger, the largest grocer in the United States and the second-largest retailer behind Wal-Mart, named DDB New York as its first ever creative agency of record. OMD won the global Boehringer Ingelheim animal health account, and Allianz named a number of Omnicom agencies for an integrated offering, which will include creative media branding and PR. "- John Wren, CEO Omnicom

When asked about how advertisers are feeling about the economy and general business tone:

"I'd suggest that it's business as usual. There are always macro concerns and they change from quarter to quarter or period to period, but there's always something out there. Our folks are focused on our clients' needs and we don't see any significant change for them.

"I think the U.S. economy is strong. I think, when we look at our core businesses, the ones that we anticipate growth from — they grew very well — mid-single digits.

When asked if they've noticed the slowing of media, as Publicis stated in their Q3 2019 report:

"I haven't read the Publicis transcript, but our media business continues to perform very well, as reflected in our numbers. It's a very vibrant business and we continue to win our fair share — more than our fair share of accounts. In regard to the fourth quarter, I think I'll say something very similar to what I've said the last 22 or 23 years of fourth quarters, and that is there's always unidentified projects in the fourth quarter. They generally, in our case, start off looking like they're $200 million around the end of September, and I think all but one of those years, with the impact of the Great Recession, we've been able to fill those gaps through projects and budget releases from clients who might have been holding back as of September 30. So, we're cautiously optimistic, as usual, and our people are focused on gleaning that revenue.

When asked about in-housing (the seeming trend of many marketers taking some or all of their media buying internally):

"I mean, technology changes what comes in-house and what stays out at an agency. Oftentimes, somebody was doing something with us and they decide to in-house. We follow them in-house to help them set up and grow, and that just enhances the relationship. But I think that the most dramatic changes that we've noticed on in-housing really has been in the CPG area. Others do it, but they do it for a while … and then decide that they can't do it and come back to us…." - John Wren, CEO Omnicom

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Summary: Much of the discussion on the call centers around the approval of the sale of a substantial portion of Kantar. Q3 showed slow and steady financial improvement; however, economic headwinds are still prominent in their forecast.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote: "We set out a three-year plan on December 11th last year to return WPP to sustainable growth. I think there are two key objectives in that — one or two key metrics. One was organic growth and the second was leverage, and I think you can see in this set of numbers and yesterday's approval of the Kantar transaction good progress on both. And so, we really remain on track to deliver our three-year plan. We set out a new vision and offer for the company; really the vision to be a creative transformation company and a broader offer, covering communications, experience, commerce, and technology. a broader offer. We will be better positioned to the faster growing parts of our market and what a modern marketing business needs to grow and succeed in today's environment. And I think you can see in the wins in our business, the improved retention of clients, such as Centrica or the U.S. Marine Corps, that [are] having some success and an increasingly integrated proposition is working with clients." – Mark Read, CEO


"I think pleasingly, … we have to look at it in the context of it being one quarter, the improvement was broad-based, both geographically and functionally, and we saw a continuing improvement in the U.S. business from minus 5.9 percent to minus 3.5 percent in the third quarter.

"Overall, I would point out wins that took place during the quarter — the creative win at Mondelez, the media win at eBay, the retention by Wunderman Thompson of its business with the U.S. Marine Corps, and the win or extension of our business with Centrica — that we had much of the business in the U.K., but not outside the U.K. It was a hotly contested account during the quarter.

"The second task was really to have a much simpler structure for the group. Importantly, to eliminate this artificial distinction between analog and digital or creative and digital and to integrate our activities to make it much simpler for clients to access the talent that we have inside the business and, frankly, make it easier for us to manage the group and sort of cut down some of its sprawling nature. VMLY&R, I mentioned before, grew positively in both the U.S. and globally in the third quarter, and Wunderman Thompson has shown improvements as well in its performance, both globally and in the U.S., in the course of the year. It's a much larger company to bring together. And so, I think it will take more time to see the results there. But I think the initial impact is positive and, certainly, we know we continue to believe in both of those cases that it was the right thing to do, as was bringing our healthcare businesses together in the core agencies.

"We are reiterating our guidance for 2019 of minus 1.5 percent to 2 percent, both including and excluding Kantar." – Mark Read, CEO

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Publicis Groupe S.A.

Q3 Stock Trend (Source: Yahoo Finance)

Summary: A dour earnings call with organic revenue restated downwards. However, post-earnings call Publicis did pick up part of the global Disney business (Theme parks, Disney+), which should boost both morale and revenue.

Q3 organic growth -2.7 percent

Q3 reported net revenue up +17.3 percent

Organic forecast restated to -2.5 percent for 2019

Top quote: "We are without a doubt at the hardest part yet of our journey, and as is the case with any major structural change, things always get worse before they get better." - Arthur Sadoun, CEO


"Our third quarter shows the two faces of our transformation, which have never been so extreme.

"The cost of our transition is hurting short-term organic growth with a negative Q3 below our internal expectations. This is leading us to take a very cautious approach and reset our guidance for revenue this year, now expected at -2.5 percent.

"Our transformation is starting to show concrete results. We are posting a 17.3 percent growth in our reported revenue, shifting the revenue profile of the group towards future-facing expertise.

"We have clearly identified the challenges affecting our industry and we haven't lost a second addressing them. We are disrupting our traditional operations with data and technology thanks to the acquisition of Sapient and Epsilon to deliver personalization at scale. We have streamlined and simplified our organization to seamlessly connect creativity, media, data, and technology. Now, we are focused on executing our strategy and there are already concrete signs that make us confident for the future.

"Finally, this improvement in our activity mix, the increased efficiency of our organization thanks to our country-led model, and our ongoing cost savings plan gives us a high level of predictability on our margin, which we are confident of maintaining at an industry-high level.

"We could have chosen the easy route and taken advantage of the status quo to find small pockets of immediate growth. Instead, we are accepting this painful situation in the short-term to be better prepared for the future." - Arthur Sadoun, CEO

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Summary: Continued revenue growth internationally (Canada, Continental Europe, and LatAm ) but challenges in the U.S.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote:

"...We will be held accountable to meet an elevated set of demands and responsibilities for ethical sourcing, collection, curation, and compliant deployment of data from all sources, including third parties. That is why we feel very strongly that what is worth owning is the highest level of capability and expertise in data management. That is a significant and increasingly necessary differentiator in today's world. It makes [companies] like ours a more strategic business partner for our clients." - Michael Roth, CEO


"We are pleased to post another quarter of solid financial performance. Our growth was led by our media, healthcare marketing, public relations, and sports & entertainment offerings. We saw contributions from a broad range of client sectors, including healthcare, financial services, retail, tech and telecom, and consumer goods.

"Acxiom continues to perform consistent with our plan, and we are seeing the benefit of our leadership position in data management capabilities.

"At quarter end, total headcount was approximately 54,300 — an increase of 5.7 percent from a year ago." - Frank Mergenthaler, Executive Vice President, Chief Financial Officer

"We also invested in embedding modern digital offerings and expertise into all of our agency brands. We pioneered the open architecture model, which brings the best agnostic solutions to global clients in a way that moves their brands across the consumer landscape. This client-centric approach is currently deployed across many of our largest clients worldwide. Open architecture is enabling clients to reap the benefits of all of IPG's assets; customized offerings that help them address the demands of a fragmented consumer and media environment.

"To note, Acxiom now has a prominent seat at the table with our top open architecture clients. That is because clients increasingly recognize that the future of marketing is data-driven. Marketers are looking to leverage their own first-party data, coupled with other strategic data sets to create more seamless and connected consumer experiences at scale. What that means is that expertise in managing first-party data and PII at scale is indispensable for a high-value media and marketing services partner. Ultimately, we are seeking to achieve people-based marketing."

"Brooklyn-based Huge unveiled a new operating model, as the agency elevated key leadership roles and streamlined its U.S. offering. The agency also saw a number of new business wins in the third quarter, including AccuWeather and e-commerce car buying platform RumbleOn.

"R/GA Ventures announced its Oregon enterprise blockchain venture studio during the quarter. The six participating companies presented a demo day this month aimed at building a scalable blockchain-based ecosystem.

At Deutsch, we recently announced that both New York and LA offices will be led by women CEOs from within that agency. The Deutsch LA office was awarded Behr Paint, Mattel, and global dot com redesign responsibilities for the Almond Board of California, while NY secured Reebok, Michelob Ultra and Budweiser, and J&J's Attune.

In response to a question about the global movement to legislate and protect privacy:

"I don't think it is a secret that with GDPR, we see it already in place. I think it's in January in California and other states have adopted similar requirements, which is why, by the way, we support the Business Roundtable position on our federal GDPR. I mean, it's not easy to do it on a state-by-state basis. Each of the states are going to require different things and, therefore, … 'is a great deal of additional work for our clients, as well as us, and if we had a federal legislation that covers it, it's an important issue. I think it's pretty clear that it's here to stay and regulation in this area is important." - Michael Roth, Chairman & CEO

In response to a question regarding growth of addressable advertising:

There is a shift moving from TV to digital. We see that in terms of having TV and linear TV pass digital in terms of total spend. So, all of this is frankly why we bought Acxiom and why we isolated certain aspects of that in Kinesso. So the value proposition that we can bring to our clients, in terms of addressable, [is] finding the right individuals — to think of it as looking for individuals, not just groups of people and on a cleanse basis. So, yeah, I think it's happening in the marketplace and we add value when those issues come up. So, when clients ask about it, that's good for us because if we can be in front of our clients showing our capabilities, it adds to the relationship significantly.

In response to a question regarding the implications of a possible recession:

"I don't see any signs of a 2008-2009 recession right now and, even with the talk, a lot of people are talking about if there is a recession, it is going to be a recession light — whatever that means. But in 2008-2009, marketing dollars, there was no capital. I mean, it was a whole different world. I think we've taken the position already. That's why we're able to expand margins like you are seeing — [because]we match revenue and expense very carefully. All of our agencies have very strong disciplines that, before they had headcount, it has to be associated with revenue. Well, the fact that we are doing the dispositions on those countries that were not necessary to be in all leads itself to margin expansion efficiencies and protecting our P&L in the event that a recession comes." - Michael Roth Chairman & CEO

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MDC Partners:

Summary: Still very much in the re-building phase, and some good account wins:

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote: "We're taking smart actions that will organize our offerings, reduce our costs, capitalize on our strengths, and enhance our go-to-market capabilities. During the second quarter we announced the alliance between MDC Media Partners and Gale, bringing our media agencies and our sophisticated data analytics more closely together. The new team is effectively reuniting media with creative.


"In terms of performance, the significant cost reduction actions taken in late 2018 and throughout this year, in tandem with prudent financial management, helped deliver a 6 percent increase in adjusted EBITDA on a year-to-date basis. Revenue softness was driven by the clients in media healthcare and one of the global creative agencies.

"We're addressing all of the issues as part of the New World plan and are seeing a rebound in new business in some of those areas. Although revenue was down for the quarter, net new business was again solid at over $30 million, with several notable wins, including Nature's Bounty at Done, Vodafone Global; and expanded assignments with Ancestry.com and Anomaly; international creative duties with Electrolux Group and F&B, and Qualcomm, and Allison Partners.

"In addition, last quarter, we reported that we won Haagen-Dazs global creative duties with F&B, and we've since further expanded this relationship to a new General Mills brand with another MBC agency. This momentum has continued into Q4 with 72andSunny's fantastic win of Audi global creative duties, announced just this morning, on top of Doner's recent win of three [of] Johnson & Johnson's most recognizable brands: Tylenol, Listerine, and Zyrtec. The latest Doner achievement is not only a significant win for MDC, but since it was one together with the Stagwell Group's, Code, and Theory, it's an indicator of the potential success that can come from such collaboration.

"We're about to enter the next phase of our plan with the formation of two additional multi-agency networks, led by two of our flagship agencies. Together with the combination of MDC Media Partners and Gale, we expect to reduce our 25 reporting units by half.

"We expect to complete our full New York transformation by the end of 2020 and generate future annualized cost savings of about $10 million. – Mark Penn, CEO

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Summary:Asia-Pac is weighing down the overall business, and U.S. is showing signs of strength, in large part driven by the win of a portion of Proctor & Gamble business.

Q3 Stock Trend (Source: Yahoo Finance)

Top Quote: "Clients are expecting much more services, but what allows us to have a robust win rate is the combination of our capability. The fact that we can deliver idea-led, data-driven, and tech-enabled offerings to clients with the strong data and analytics products we've been able to make since our acquisition of Merkle. And these are the things that make us more competitive in the pitch environment." – Timothy Andree, executive officer & director

Quotes: "There are no green shoots of recovery in the Chinese and Australian markets, both of which continue to severely impact the regional and group performance."

"In the international business, in order to future-proof our business and serve clients more effectively, we have streamlined and consolidated our offering around three lines of business: creative, media, and CRM. These lines of business have been designed around client needs and will ensure we are set up to help clients win, keep, and grow their best customers by being data-driven, tech-enabled, and ideas-led. 2020 is a year of transition and by 2021, we will be operating under these three lines of business and be truly integrated by design.

"–…Our entire CRM and data business is really leading our growth. If you look at the numbers in the Americas where Merkle, as a brand, has its highest percentage of business, it really accounts for the lion's share of the growth and momentum we have in the market. Merkle cannot really be compared as a business or an offering to Acxiom or Epsilon, which are largely just data businesses. Merkle has always been even and has continued to be since our acquisition, a double-digit organic growth business…. Merkle is in the people-based marketing business, which is currently in high demand from clients and in the highest-growing sectors of ad tech, mar tech, and commerce implementation.

"But the uplift in the U.S., I attribute, in September, largely to the coming online of the P&G North America win in our media business that came on stream in July and then built momentum and reached, really, the kind of consistent level in September." – Timothy Andree, executive officer & director

In response to a question requesting a split of the DAN revenue across the three units of media, creative, and CRM:

"In terms of the split of the international business across those three lines of business, in round numbers, 50 percent in the media line of business, 25 percent in creative, and 25 percent in CRM." – Nick Priday, Executive Officer.

In response to a question about the current pitch environment:

"The current announced pitches … have been announced by clients [totaling] about JPY 4.7 billion in size of media billings. And of that, about 75 percent of those opportunities are offensive pitches — opportunities for us, with 25 percent being cases where we're the incumbent. Our expectation, and it's only an expectation, but based upon our assessment of the market, we expect 2020 and 2021 for that pitch pipeline to grow and to be larger than it currently is. However, also looking at the mix, we expect that the defensive pitches may have a slightly higher percentage, as we look at 2020 and 2021 based upon our existing contracts … with clients.

"Of course, a large portion of our media business, for example, still remains to be regular pitching for local multi-market media accounts, which really accounts for about 40 percent of our mix.

"The pitch environment pricing does play an element of it, but where clients are expecting more than that, it is total value for their dollars. They're expecting much more addressability in their capability. Data plays a bigger role. So, in that respect, pricing is always a factor. There's always that aggressive competitive nature of that business. But, in the end, the type of business we want to win is not where we're the lowest bidder." – Tim Andree, executive officer and director

In response to a question regarding the impact that Google is making in the overall agency business, in addition to consultancies:

"We don't see ourselves being directly disintermediated in a large way from Google media. It's true with some smaller clients and D2C clients do go to Google and some of the social media platforms first. But, in large scale, that's not impacting our business, largely because … the role that we could play that Google can't, it is to manage the entire media and marketing ecosystem and balance out in a strategic way the client's investment. When clients go directly to Google, Google's recommendation is for them to buy more Google. And so, that has not been a big impact on our business. …In many ways, we partner in developing products with Google to help benefit our clients. And so, I don't see that as a particularly impactful concern of direct disintermediation of media going to Google in our markets."

"In regard to the consultancies, you know that we compete daily against the consultants. Our Merkle and Isobar brands compete and win regularly against them. Our approach is far more about growing the top line and having deep consumer insights in how consumers behave. And then those insights can play themselves into full execution. Where I think the consultants have largely focused less on execution, more on strategy, as well as more on bottom line efficiency. So, I think' everyone's evolving. They're formidable competitors." - Timothy Andree, Executive Officer and Director

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WarnerMedia Investment Day


Comcast - NBCU


DISH Network






Outfront Media







Summary: While advertising is only a very small portion of the overall revenue (and an even smaller part of the earnings call), it is growing and they seem happy with performance to date.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote:

"Yes, so let me start with the first question on advertising. So other revenue, which is principally advertising, grew 45 percent this quarter, up from 37 percent last quarter and the biggest thing in there is advertising and advertising grew at a rate higher than that 45 percent. – Brian Olsavsky, CFO


"So, it's still early and what we're focused on really at this point is relevancy, making sure that the ads are relevant to our customers, helpful to our customers. And to do that, we use machine learning and that's helping us to drive better, better, and better relevancy."

We are very happy with the progress in the advertising business and continue to focus on advancing advertising experiences that are helpful for customers, helping them to see new products. We want to empower our businesses to find attract and engage these customers. And it's increasingly popular with vendors, sellers, and third-party advertisers.

- Brian Olsavsky, CFO

>"I think, specifically on the advertising side and the opportunity with that, we are continuing to see some increased adoption. One of our areas of focus is expanding our video and OTT offerings for brands. It's still early in this space, but we've done a few things with IMDb TV, live sports, things like adding more inventory through Fire TV apps, … adding more OTT video supply through Amazon Publisher Services or APS integrations and streamlining access for third-party apps and really just making it easier for advertisers to manage their campaigns and provide better results.

"I have to start with the fact that we did recently introduced 20 new Fire TV products, so that includes … the first Fire TV Edition sound bar, Fire TV Cube. - Dave Fildes, Director of Investor Relations

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Summary: Pay television subscribers to traditional MVPD (DirecTV, U-Verse) fell off a cliff in Q3 2019 with a loss of over 1.3 million subscribers. HBO Max was a large focus and, in fact, a full investor's day (summary of the WarnerMedia Investor's Day follows below) was dedicated to formally introducing HBO Max.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote: "Third, we were convinced that the value of premium content would increase significantly over time, as consumer demand continued to grow and new forms of distribution emerged, and I think you've already seen that with some of the multiples paid for media companies after we did our deal. Vertically integrating content and distribution is the future, and we're seeing it across the board" - Randall Stephenson, CEO

"Since 2012, we've made a series of strategic investments, and those investments have been aligned around two overarching trends: First, consumers will continue to spend more time viewing premium content and, second, businesses and consumers will continue to demand more connectivity, more bandwidth, and more mobility. When we began pursuing this strategy, we saw an emerging world in which consumption of video and other premium content was no longer bound to your living room. And everything we expected has arrived, and it has arrived sooner than we or anyone else anticipated. And now, the foundational elements of our investment thesis are clearer than ever. It all starts with advanced, high-capacity networks.

"Over the last 18 months, we've been putting all this capacity into service, and the performance results have been dramatic. AT&T now has the fastest and most reliable wireless network in the U.S. We've also been undertaking the most aggressive fiber deployment program in the U.S. since 2015 with over 20 million locations passed. Over the next 3 years, our strong spectrum position will allow for lower capital intensity, and that bodes well for growing operating margins.

"The second essential element is direct customer relationships, and we have about 170 million of them across mobile, pay TV, and broadband. And that number reaches 370 million when you include our digital properties such as cnn.com, Bleacher Report and Otter Media.

"Gaining scale in linear pay TV was the core rationale behind our DirecTV acquisition. We realized the satellite business was mature and we anticipated subscriber losses. However, the content savings quickly turned our U-verse pay TV business from loss to a profit. And since we bought DirecTV, it has generated healthy cash flows of over $4 billion per year or a total of $22 billion in cash by the end of this year.

Responding to a question if AT&T has hit peak subscriber loss in TV:

"But as we get into next year, then you'll have the satellite then you'll have the software platforms. And AT&T TV is the standardized software platform, and that will be our primary vehicle for going to market, particularly pairing it with our fiber product and our broadband product. And then, HBO Max becomes the workhorse for our video product as we move into next year. And all of the muscle, and as you can see and as you articulated, the range of investment is going behind HBO Max. This is a product that's going to be very different from anything else that you've seen in the market so far. This is not Netflix, this is not Disney, this is HBO Max, and it's going to have a very unique position in the marketplace. And I would tell you, we feel very comfortable at these investment levels, that we can do something very significant in the market and drive some significant subscriber gains. This is going to be a meaningful business to us over the next four or five years. And we're talking a 50 million subscriber business. And I'm really, really enthusiastic about this.

"But HBO Max becomes the SVOD platform for AT&T as we move forward into the future. And what you should expect is, as we get into the future, this won't be day one. …[Through] the platform … we also deliver live stream TV. So, you want an SVOD service, HBO Max, great. Over time, we look forward to bringing [the] live element into HBO Max, as well. And so, this thing gets more and more simplified and we ultimately get down to where we have two products: the traditional satellite, which will be there for a long time; and then our streaming product, which will be premised on the HBO Max platform.

"And we have been on a very aggressive plan for deploying fiber. And we put in a very short period of time 20 million locations passed with fiber. And we are somewhere between 20 percent and 25 percent penetrated in that footprint [and], in the next couple years, are going to be about penetrating. It's really about penetration. That doesn't mean we're stopping fiber deployment. 5G requires us to continue deploying fiber. We have business customers who have expectations and we deploy fiber into business locations. And what that does is create capillaries that we, then, expand off of. And so, you're going to continue to see the capillary of fiber in this company expand. It's just not going to expand at the pace we've been going on. It's been on a torrid pace. I would suggest it's been the most aggressive in the United States. Now, it's time to reap the rewards of what we've done and let's go penetrate the market.

"But the most powerful video bundle we have with our mobile business is HBO, in terms of what it does to churn and retention. And the reason I think that's very exciting is now think about HBO Max and taking that product to a different level. And it's going to be something different. And now, bundling that with our mobile business and the impacts on churn, we believe, are going to be very, very powerful. And so, we're very excited about putting wireless with HBO Max. HBO Max is a natural bundle with, obviously, our video business, whether it's DirecTV or AT&T TV. It's a great bundle with our broadband business, particularly the fiber business. So, we're really bullish right now on how HBO Max gets leveraged across the footprint."

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WarnerMedia Investment Day (HBOMax)

Summary: In addition to the Q3 earnings call for AT&T, an information-packed, two-hour program was dedicated the following day to fully introduce WarnerMedia's HBOMax streaming service. This very much played like a major Upfront note, that there is a clear announcement of an advertising-supported service around a year following the launch of HBOMax. HBOMax will be released in May and is priced on the high end at $14.99/month.

Top quote: "In the era of Amazon, Apple, Google, and Netflix, scale is no longer defined by distribution to a quarter of U.S. consumers. It's a global game." - John Stankey, CEO WarnerMedia


"There are three pillars needed for success in streaming. Premier content, a technology platform, and marketing & distribution. Only AT&T enters this space with solid footing in all three."

"Why is the launch of HBO Max so important? Just like cable introduced the rise of niche networks to grow audience, general entertainment streaming is the next great opportunity to aggregate and grow audience.

"HBO Max will have a positive and immediate impact on the stickiness of our wireless and pay TV and broadband offerings. A reduction of 1 basis point of wireless churn is equal to $100 million in revenue.

"Less than a year after we launch, we plan to expand the Max platform to include an AVOD option, offering consumers access to even more content with greater flexibility on how we price and monetize these customer relationships. This is where Xandr employs data from AT&T's customer database, along with innovative ad formats.

"Programmatic and targeted advertising associated with high quality content is a winning combination.

"Today, we have approximately 10 million HBO subscribers that include TV, mobile, and HBO Now subscribers served by WarnerMedia. On day one, we'll provide a frictionless opportunity for these HBO subscribers to sign up and get HBO Max immediately.

"Our customers (AT&T) interact with us more than 3.2 billion times annually, and we have more than 170 million direct customer relationships across mobile, pay-TV, and broadband.

"We intend to reach 50 million subscribers domestically by 2025.

"We are prioritizing our international expansion in LatAm and Europe.

"As a result of our global efforts, we plan to reach 75-90 million premium worldwide subscribers by 2025 across the U.S., Latin America, and Europe." - John Stankey, CEO WarnerMedia

"40 percent of the total viewing of HBO this year has been in digital.

"HBOMax will launch domestically in May of 2020 and will include the HBO service and library bundled together with a large offering of original new content, appealing to all the younger demos plus a choice slate of acquired programming and titles from the extensive Warner Bros. library.

"In 2018, 120 million people engaged with HBO content. Around the world, it reaches over 150 countries.

"Nielsen tells us that the average search time on SVOD is eight to nine minutes. HBO recently introduced the concept of '"Recommended by Humans,'" and we're going to adapt that idea for HBOMax, so we never have to rely solely on an algorithm to serve our customers the best content.

"HBO Max will begin with 10,000 hours of content. While less than some of our competitors, we actually think that the value proposition improves when you narrow the options, removing much of the filler no one watches anyway.

"The median age of linear HBO is only 49, but that drops to 36 when you look at HBO Digital, where the younger audience is growing quickly." Bob Greenblatt - Chairman of WarnerMedia Entertainment

"HBO shows will continue to have what they've always had: great writing, casting, direction, incredible production value, but, most importantly, context. They all have something to say about the world we live in.

"Breakout Chernobyl's masterful storytelling helped it surpass 13 million viewers. It's now our most-watched mini-series of all time. 'Euphoria' quickly became our second most dsseries behind only 'Game of Thrones'. With over 9 million viewers, the first installment of 'Leaving Neverland' now ranks as HBO's highest rated documentary of all-time.

WarnerMedia announced the following shows to be included on HBOMax:

  • "Run" a new comedy executive produced and guest-starring Phoebe Walker-Bridge, the Emmy winner for "Fleabag."
  • "The Outsider," based on a Stephen King novel.
  • "The Undoing" with Nicole Kidman, Hugh Grant, and Donald Sutherland, a chilling thriller by David E. Kelley.
  • "Lovecraft Country" from Jordan Peele and J.J. Abrams. A 1950's period piece that turns into '"one of the scariest thrill rides you've ever seen.'"
  • A reboot of "Perry Mason," starring Mathew Rhys of "The Americans."
  • "Avenue 5," a sci-fi comedy from the creator of "Veep", Armando Iannucci, starring Hugh Laurie and Josh Gad.
  • "I Know This Much is True" with Mark Ruffalo, based on Wally Lamb's bestseller
  • "The Plot Against America," starring Wynonna Ryder and John Turturro.

"I want to highlight three big events for 2021. We have Joss Whedon's highly anticipated new fantastical series "The Nevers". We have Kate Winslet as a complicated Pennsylvania detective in a limited series called "Mare of Eastown", and we have something totally delightful for fans of "Downton Abbey": Julian Fellowes' "The Gilded Age," set in opulent New York in 1885 with a dream cast that includes Christine Baranski, Cynthia Nixon, and Amanda Peet. And I haven't even mentioned our big slate of documentaries and doc series that will take us into so many other compelling worlds. - Casey Bloys, President of Programming HBO

"Our research tells us there is a subscription opportunity of 75 million potential domestic in these demos, and we're going after them.

"We see that only a handful of individual titles drive more than 2 percent usage among the thousands of content hours available on those services. Further, of the thousands of titles available, it's the top 100 that drives half the total usage. An SVOD service may have 35,000 hours of content, but half of their usage is driven by only the top 100 titles.

"The top ten licensed comedies on competitive streamers account for 80 percent of the total licensed comedy viewing.

"Breadth of choice is important, but content that matters to viewers is the real point of differentiation.

"We are overjoyed to extend our license to all 50 seasons of the show, [Sesame Street] which we will curate during the year, plus we'll have the next five seasons of new episodes too. HBOMax will have streaming exclusivity on the whole gang. We have lots of new Sesame Street content, including the next season of "Esmee and Roy", a new series called "MechaBuilders", plus a great new special, "Monster at the End of This Story". And not to be left out of the late-night wars, we have a new talk show starring a furry red monster, and no, I am not talking about Conan O'Brian. It's none other than Elmo ("The Not Too Late Show with Elmo").

"HBOMax will have an outstanding offering with over 1,800 movies, featuring half of the top 50 box office titles of the year in the HBO service alone. Top Warner Bros. franchises available across our first year include the full set of "The Hobbit", "Lord of the Rings", and "The Matrix" trilogies. Plus, over half of the top 20 horror movies of all time, anchored by the most successful modern horror franchise, "The Conjuring" which has generated over $2 billion in worldwide box office. Both "Gremlins" films will be available and the Lego movies will be added in time for the summer break.

"I want to take a minute to talk about one of the most valuable assets of this company, DC, which has been part of Warner Bros. since 1969. From "Batman", "Wonder Woman", and "Suicide Squad" to "Shazam" and "Aquaman", the top grossing DC title of all time, HBOMax will have all DC releases of the last decade available within the first year of launch, including every Superman and Batman movie from the last forty years. The current box office smash "Joker" will be available at HBOMax at launch through the HBO service.

"Friends" will now be calling HBOMax its exclusive SVOD home.

"We have another group of friends and one of the biggest shows for 12 years, "The Big Bang Theory". This is the first time that all 279 episodes will be seen in any streaming platform and HBOMax has them exclusively.

"Today, I am happy to announce that HBOMax will be the exclusive SVOD home of Trey Parker and Matt Stone's brilliant animated satire, "South Park". HBOMax will offer over 300 episodes, which is 23 seasons, all available shortly after launch and 3 new seasons.

"We recently announced an exclusive landmark deal with one of the most acclaimed animation studios in the world, Studio Ghibli for their entire catalog of 21 of the most revered Japanese animation classics, which have never before been offered on any streaming platform.

"We'll have 31 Max Originals series in our launch year. Combined with HBO, that's 69 series on HBOMax in 2020. We'll grow our Max Originals to 50 series in 2021. Combined with HBO, that's a total of 88 series in 2021."

"We know you like to binge and on HBOMax, you can binge previous seasons and library content to your heart's desire [but not new content]. - Kevin Reilly, chief content officer

"The Warner Bros. Animation Studio and Cartoon Network are both in the family and we are in business with them in several ways. Starting with Cartoon Network, we'll have fun new episodes of the "The Fungies" and "Tig n' Seek". We are bringing back their number one franchise, "Adventure Time," with four brand new hilarious specials made exclusively for Max. We also have a delightful new animated series "Little Ellen" from Ellen DeGeneres with her as a 7-year-old girl growing up in New Orleans. "Gremlins: Secrets of the Mogwai" is the origin story of those naughty little creatures who we all know and love. We are also developing an inspired new series from visionary Robert Zemeckis called "Tooned Out," which merges animation and live action with a cast of Looney Toonscharacters you can only see on Max.

"We also have inventive content for older kids in the unscripted area, such as "Craftopia" with YouTube superstar, Laura DIY, and "Karma", a fast-paced challenge game where how the kids treat each other affects their chances of winning."

Announcing new originals targeted to Millennial/Gen Z:

  • "Tokyo Vice," starring Ansel Elgort and directed by Michael Mann
  • "LoveLife" with Anna Kendrick in her first series
  • The reboot/revival of "Gossip Girl"
  • New episodes of DC fan favorite "Doom Patrol"
  • "DC Superhero High" from Elizabeth Banks
  • "Grease: Rydell High"
  • Issae Rae's, "Rap Sh*t", a look at the Miami music scene
  • "College Girls" for Mindy Kaling
  • "The Flight Attendant," starring Kaley Cuoco and produced by Greg Berlanti
  • "Strange Adventures" by Greg Berlanti
  • "Green Lantern" by Greg Berlanti
  • "Unpregnant" from Greg Berlanti, based on the novel by Jenni Hendriks and Ted Caplan

"We have the futuristic "Station Eleven," based on a novel we love. It's produced and directed by Hiro Murai, from the award winning "Atlanta". "Made for Love" is a quirky, dark comedy about a husband using cutting edge technology to control his wife's mind. We are adapting the sweeping book "Americanah" into a series starring the incomparable Lupita Nyong'o.

"We also have "Circe," a fantasy epic based on the recent best-selling book about one of the most evocative goddesses in ancient Greece. And last, but not least, a new science-fiction epic from Ridley Scott, "Raised by Wolves". This is one you simply haven't seen before. It focuses on a rogue, female AI, that will stop at nothing to raise her children.

"Movies are important to our original programming mix, so we'll start building this focusing on five to 10 originals per year. We made a two-picture deal with Reese Witherspoon and her company, Hello Sunshine, who have cornered the market on telling fresh, contemporary stories from a female perspective.

"We are also thrilled to be working with one of the great contemporary filmmakers Stephen Soderbergh, who brought us "Let Them All Talk," starring the legendary Meryl Streep.

"We have the one of a kind Melissa McCarthy, starring in "SuperIntelligence" about a woman whose romantic life is selected for observation by artificial intelligence.

"Finally, we have "Bobbie Sue," featuring Golden Globe winning "Jane the Virgin" star Gina Rodriguez as a brilliant young lawyer who upends a conservative law firm." - Sara Aubrey, Max Original Content

"We just commissioned 80 brand new original shorts (Looney Toons) aimed at today's audience.

"We also own the Hanna-Barbera characters (The Flintstones, Scooby Doo, Yogi Bear, Magilla Gorilla, Top Cat, QuickDraw McGraw), all of whom will be in series, movies, and digital shorts in the platform. We even have a brand, new original series called "Jellystone!" where all these original characters come together.

"We entered into a long-term arrangement to bring the next 10 Warner Bros.-produced CW shows to HBOMax after they premier on the network.

"Rick and Morty, with over 1 billion SVOD views. The past seasons will be available on HBOMax at launch and the newest season will be available in the first year after premiering on Adult Swim.

"Over 100 unscripted series. We have additional new footage from "The Bachelor". We have over 100 hours of Impractical Jokers.

"Rizolli & Isles, The Closer, Major Crimes, The Alienist, The West Wing, Dr. Whowill be on HBOMax."- Michael Quigley, Library and Acquisition

"When you are streaming dragons and white walkers, you have to be prepared for just about anything, like streaming five million concurrent users across 22 device platforms on a Sunday night. iStreamPlanet, the undisputed leader in live streaming, is also part of this company. In 2018, over 4 billion live stream minutes passed through this platform like the Super Bowl, the Olympics, NCAA, and FIFA World Cup." - Tony Goncalves, Otter Media CEO

"The average person looking for something to watch on-demand burns about nine minutes per session searching. Twenty percent of those people give up and wander away without watching anything. On top of that robo-recommendations only result in 26 percent of viewers watching what the algorithms recommend. Data by itself is not the answer. We think you still need those human elements that make entertainment so enjoyable: personality, connection, emotions. We believe the big opportunity here is to blend the smart use of data with real human touch and to present them via novel product experiences and ways that are elegant, trustworthy, and seamless. - Andy Forssell, Executive Vice President & General Manager

"We expect to release updates every six to eight weeks to stay ahead of the curve in this highly competitive environment.

"We will launch HBOMax with all the bells and whistles in our playbook. That goes beyond television commercials and billboards. We will mobilize our innovative marketing teams across our entire company to drive audiences to HBOMax.

"HBOMax will retail for $14. 99.  Current HBONow billed subscribers will get immediate access to HBOMax in May at no extra charge.

"We value both our current subscribers and distribution partners and intend to make it easy for them too. Those over 30 million HBO subscribers should be able to download the app, login, and watch. We are in active discussion with our distributors and we have an agreement with AT&T to distribute HBOMax and we look forward to working with our distributors, so they can also get HBOMax in front of their customers.

"We will utilize this unique foundation to give the AT&T subscriber base many options to learn about, subscribe to, and trial our offering. AT&T today is the number one distributor of HBO in the U.S. Those existing AT&T and DirecTV HBO subscribers will have immediate access to HBOMax at no extra charge. Now AT&T customers without HBO who subscribe to premium video, mobile, and broadband packages will be offered bundles with HBOMax included at no extra charge. In addition, the HBOMax app will be pre-loaded on both AT&T TV-connected set-top boxes and Android phones. And on top of all that, wireless and broadband subscribers will also be able to use their existing credentials to sign in to HBOMax.

"Our goal is to bring one of the richest collections of content on a direct-to-consumer basis for everyone" - Tony Goncalves, Otter Media CEO

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In Q3, CBS was focused on finalizing the merger with Viacom, (which officially was completed on 12/4/2019) but that did not seem to be a distraction, as they increased production, generated higher revenue from retrans negotiations and licensing of content to other content distributors, aka Netflix. Advertising revenue year-to-year was down on Q3, but that was mainly due to 2019 not being a political year. Network advertising grew a modest 2 percent, while digital advertising across platforms grew a healthy 19 percent.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote: "Starting next September, Nielsen's measurement of out-of-home viewing will be included in our ratings, so we will have an opportunity to monetize this viewing for the very first time. The NFL offers a great example here. Nine weeks into the season, the NFL on CBS is off to a strong start, up 6 percent year to date. When you factor in out-of-home viewing, we get an additional 11 percent lift to that increase. It is a significant lift in ratings. For example, the Super Bowl had an over 10 percent lift and that means that's over 11 million people watch that were not in the rating. national news is also another one. Believe it or not, daytime content is also a big lift." – Joe Ianniello, President & Acting Chief Executive Officer

Quotes: "Before we discuss our third-quarter results, I want to give you an update on our merger with Viacom. As you may have heard, our S-4 has been declared effective, and we are on track to close in just a few weeks.

"So, with our balanced schedule of new and established hits throughout the week, we can already predict that CBS will finish the season in May of 2020 as America's most watched network for the 12th consecutive year. We will also finish the year NUMBER ONE in late night yet again. And we're very pleased to have reached multiyear contract renewals with both Stephen Colbert and James Corden.

"Our front-loaded content investment is the key reason we are driving sustained revenue growth across direct-to-consumer, content licensing, advertising, and our linear distribution revenue. And, in terms of dollars, the biggest increase during the third quarter came from a revenue source that's been at the forefront of our growth plan, retrans, reverse comp, and virtual MVPDs, which were up 18 percent despite CBS being off the air with AT&T for more than 20 percent of the quarter.  Plus, about 50 percent of our retrans footprint and about 30 percent of our reverse comp footprint are coming up for renewal next year, which means we will have another strong year of healthy gains from retrans and reverse comp in 2020 as we continue to reset the value of our content to current market rates.

"D2C revenue was up over 39 percent for both the quarter and year, to date, as consumers shift from traditional bundles to skinnier bundles, to CBS All Access and to Showtime OTT, we are getting paid higher rates per sub. Even with the headwinds of the traditional MVPD business, when you include subs from virtual MVPDs and our direct-to-consumer platforms, our overall subs at CBS and Showtime grew 4 percent year-over-year, which means consumers are actively seeking out our content as they select the platform of their choice.

"We are currently creating an all-time high of 94 shows, up 20 percent from a year ago, and that's up more than 120 percent from what we did just five years ago.

"Our underlying network advertising revenue was up 2 percent for the quarter and 2 percent year-to-date, as well. And the momentum continues here in the fourth quarter with strong scatter pricing and steady advertiser demand.

"I am pleased to announce today that we have a deal in place with Viacom to add more AVOD channels on Pluto starting tomorrow. And we continue to look at our content to see how we can expand our reach of our CBS properties on a growing number of platforms." - Joe Ianniello, president & acting chief executive officer

On CBS All-Access:

"We launched a new original series on All Access, Why Women Kill, starring Lucy Liu, which was just renewed for a second season and helped drive subs for us during the quarter. Next, we had a summer reality show, Love Island, which launched on the CBS Television Network and attracted a much younger audience on All Access, where more than a third of the viewers binge the show. So, this represents an example of our ability to expand our reach across multiple platforms. In addition, combined streams from the NFL and the SEC are up nearly 60 percent over last year's strong growth.

"We are also very excited about a new development for All Access. We will now have exclusive, live marquee sports for the very first time. The UEFA Champions League, including a UEFA Europa League, and the newly created UEFA European Conference League, will be coming to CBS and CBS Sports platforms with all matches available on All Access and select games airing on broadcast. We will now have more than 400 matches per year spanning nine months across the calendar. - Joe Ianniello, president & acting chief executive officer

On Showtime:

"During the third quarter, we launched three new critically acclaimed series, The Loudest Voice, City on a Hill, and On Becoming a God in Central Florida, and these original series are helping drive sub growth at Showtime OTT. And there's more to come with a big programming lineup that rolls right into next year. Here in the fourth quarter, we have Shameless, Ray Donovan, and a brand-new version of The L Word. And in 2020, we have a number of new shows with lots of star power, including Penny Dreadful: City of Angels, starring Nathan Lane; The Good Lord Bird, starting Ethan Hawke; and Your Honor, starring Bryan Cranston." - Joe Ianniello, President & Acting Chief Executive Officer

On the political year:

"By early next year, we will have our local versions of CBSN in all the major CBS markets where we have local news operations, so we can benefit from a more robust multi-platform approach as we head into the next election cycle. As we've said before, we expect 2020 to be a record-setting year for political ad sales." – Joe Ianniello, President & Acting Chief Executive Officer

On Advertising Revenue

"Advertising was down 7 percent from last year when we had record political spending. As you heard, underlying network advertising was up 2 percent for the quarter and 2 percent year to date. And digital advertising for network content across platforms grew 19 percent. Operating income for the third quarter of 2019 was $581 million, compared to $736 million last year, which included an increase in non-sports programming of more than 20 percent."

"At the CBS Television Network, scatter is up more than 30 percent from Upfront pricing here in the fourth quarter, and we are seeing strong increases in all entertainment and news daypart.

"Tech and pharma are our strongest categories. And, while it's early, we have seen the beginnings of what we believe will be a very hot political market.

"As we renegotiate deals that recognize the fair value of our content, we are on track to reach our target of $2.5 billion in retrans and reverse comp revenue in 2020. And as we continue to accelerate the growth of our direct-to-consumer services with our investment in premium content, we are also confident we will reach 25 million subscribers combined on CBS All Access and Showtime OTT in 2022. In summary, for the first nine months of the year, we have achieved record revenue for the CBS Corporation.

"We are positioning CBS and, ultimately now, ViacomCBS, for continued growth across our key revenue streams in advertising, content licensing and affiliate, and subscription fees, and we are set up for particularly strong growth in our biggest revenue opportunity, our direct-to-consumer services."– Chris Spade, Chief Financial Officer

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Comcast NBCU

Summary: Strong report across the board with actual cable and broadband growth.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote: "I think in terms of the overall ecosystem and the promotional intensity …' it's not too surprising to me. I think you've got the 3 biggest media companies — Disney, Time Warner and NBCUniversal — all launching streaming platforms. And this is a moment in time and a lot of people are being very, very aggressive about it. And I would anticipate that to happen until, at some point, there'll be an inevitable slowing down and shakeout, and the market will get a little bit more rational. But I think it's a moment in time, and consumers are making their choices of apps and viewing habits, and you want to be aggressive to get in there and make sure that your service is one of the consumers' handful of favorite services." - Stephen Burke, Senior Executive Vice President, CEO NBCUniversal


"Starting with broadband — it goes without saying the utility and demand for high-speed and reliable internet access are ever increasing. We see this in our customers' behavior — monthly data usage more than doubled in the last 3 years — and our power users are connecting nearly 20 devices in their homes daily.

"And with Flex, we just added a fourth pillar: streaming, designed to meet the growing needs of customers who only consume video over-the-top. Flex enables these streamers to quickly and easily search, access, and enjoy content across their favorite apps on the TV using our award-winning voice remote. It's a wonderful product and, now, we are providing it to our broadband-only customers for free.

"Cable added 379,000 broadband customers, the most for a third quarter in 10 years. This drove our best total customer net additions on record for any quarter, contributing to a 3.4 percent year-over-year increase in customer relationships. And we're also increasing the value of our relationships. EBITDA per customer relationship grew 3.2 percent. And what is even more impressive, our net cash flow per customer relationship grew 13 percent.

"NBC plays number one in primetime among adults [ages] 18 to 49 for the sixth consecutive 52-week season. Telemundo was number one in Spanish-language weekday prime for the third consecutive season. On top of all this, the teams at NBCUniversal and Sky are jointly producing and delivering content. For example, we've greenlit our first co-productions, shared over 1,000 hours of sports content and are creating a global news channel." - Brian Roberts, CEO Comcast

"Overall cable revenue increased 4 percent to $14.6 billion in the third quarter, led by the increase in total customer relationships, as well as higher ARPU. Total customer relationships increased 3.4 percent year-over-year to $31.2 million, including 309,000 customer net additions, the best on record. This growth was driven by 379,000 high-speed internet customer net additions, the highest third quarter net additions in 10 years. We've added 1.3 million broadband customers over the last 12 months. Overall, our connectivity businesses, residential broadband, and business services continue to drive [cable] growth…. Our revenue in these businesses, collectively, reached $6.7 billion in the quarter, up 9.3 percent year-over-year." - Michael Cavanaugh, Senior Executive Vice President, CFO

"Regarding Peacock, we announced about a month ago, the name, and listed a fair number of shows that we're going to have on the service. I think the most important thing to think about as you're thinking about Peacock and its role inside NBCU and, broader, Comcast is we're not doing the same strategy that Netflix and people chasing Netflix have adopted. We're primarily working with the existing ecosystem and doing a lot of AVOD activity. And what that's going to do, we think, is cut the investment pretty substantially because I think we're going to get to cruising altitude much more quickly than a subscription service. We're also playing to our strengths. We happen to be part of a company that has 55 million video customers and is the biggest provider of television advertising in the United States. So, we'll have a mix of originals, exclusive acquisitions like The Office and a lot of non-exclusive product, as well. Importantly, we're going keep selling to other companies. If you take movies, for example, we plan to keep selling into the premium window. We're not taking all of our movies off of premium platforms like HBO or Sky or other platforms around the world.

"We're planning on launching in April. We're going to use the Olympics as sort of an afterburner after our launch, and then we'll be adding content pretty significantly throughout 2020.

"We have not closed the revenue gap in terms of retransmission consent, which leads into your next question about the cable channels. We have a lot of deals expiring in the next 12 to 24 months and channels like Telemundo that have made big strides. MSNBC is another one. MSNBC is solidly beating CNN almost every night and by a fair margin. And CNN has a much higher affiliate fee than we do. I think you can expect to see us make some real progress there." - Stephen Burke, Senior Executive Vice President & CEO, NBCUniversal

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Discovery Networks:

Summary: Strong Q3 performance with strength in ratings with TLC. While Discovery is embracing OTT and launched Food Networks Kitchen, they are still debating on their overall strategy.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote: "As women over the past year around America have put their TV sets on, they can choose to watch movies, scripted series, they could watch anything they want, but more have chosen to watch our programing than any other media company, which makes us the number one media company for women in the United States." - David Zaslav, CEO and President


"We envisioned a major opportunity to not only enhance their position globally, but also to carve out a differentiated direct-to-consumer strategy. A few weeks ago, we launched another key component of that strategy with Food Network Kitchen, a world-class customer experience in the kitchen with live and on-demand cooking classes with the most celebrated chefs from around the globe. We worked closely on all elements of the product with our partner Amazon over the last year to get it off the ground. We are very pleased with the product and very excited about the opportunity of value creation it presents.

"We generate roughly 8,000 hours of original content annually alongside a library of titles in every language that aggregate several hundred thousand. It's a huge competitive advantage, especially as we watch our industry peers on the premium scripted side pay whatever it takes to amass enough content for a slice of the fragmenting entertainment space within the direct-to-consumer market. We are not in that series scripted and movie side of the entertainment business. It's crowded, it's aggressive, it's expensive, and it's risky.

"In addition, our strategy of pivoting into sports has made us the largest producer of live sports outside the U.S.

"Food Network Kitchen is also the first new product to launch on our owned and operated tech stack and it is becoming increasingly apparent that owning and operating our own tech architecture is a distinct competitive advantage and one that should allow us to further scale opportunities across multiple verticals, meaningfully driving global functionality, efficiencies, and speed to market.

"The team at TLC has done an extraordinary job turning around and building that network. Just two years ago it was the ninth or tenth network in America for women. Today, it continues to be the number one, ad-supported cable network in primetime for women [ages] 25 to 54 and women [ages] 18 to 49." – David Zaslav, CEO and President

"In the third quarter, Discovery, again, achieved healthy operating performance, delivering 3 percent U.S. advertising growth, 6 percent U.S. affiliate growth, and 10 percent international advertising growth, which included a full quarter of impact from the consolidation of the three networks acquired from UKTV, which added about 300 basis points of growth and 8 percent international affiliate growth.

"For U.S. advertising, growth is expected to be, again, in the low-single digit range, driven by the typical dynamics in pricing, digital monetization, the health of the market, and, of course, the impact from ratings, which remains the greatest variable impacting U.S. ad revenue growth. While ratings of some key networks have been challenged in the third quarter, we have doubled the amount of premier content on the Food Network for the holiday season and we are excited about our programing slate for the remainder of the year, such that our Q4 estimate of low-single digit growth could turn out to be conservative. In addition, we expect to continue to benefit from increased viewership on our GO platform, further growth from our data-driven Engage product, as well as upward CPM pressure from innovations, such as Discovery Premiere, all of which are contributing to our top peer performance and revenue growth, despite the noted ratings headwinds.

"U.S. affiliate is projected to increase in the three percent to five percent range for the fourth quarter. And we reaffirm our full-year guidance for U.S. affiliate revenue growth in the mid-single digit range. As you know, in the fourth quarter, we will lap our initial inclusion in certain virtual MVPDs, such as Hulu and Sling TV. Accordingly, implicit in this projection is a sequential decline in our core subscriber growth.

"We expect international advertising growth in the mid-single digit range, driven by share growth in our top markets and contributions from our digital investments. Contribution from the consolidated UKTV lifestyle business is projected to again add two to three percentage points of growth. While the balance of our international advertising business remains healthy, there are some increasingly more challenging markets, such as Mexico and Argentina, creating an overall more volatile picture and one that we will keep a close eye on during the remainder of the quarter.

Responding to a question on direct-to-consumer plans:

"As you know, we've really shied away from these seven or eight players that are rock 'em sock 'em fighting it out in this entertainment area. It's getting more and more expensive. And we believe that three or four of them are going to make it. And it's going to be a lot of carnage, and very, very difficult. [They're] great companies, and good luck to them.

"We really have two strategies: one is the people will have three of those or maybe four of those, but then they still love golf, they still love natural history and science. We, together with everything we got from the BBC, now have a definitive collection of content with Planet EarthBlue Planet, Space, Ocean, Science — that, if you think about when we were younger, a family would buy World Book or Encyclopedia Britannica because every family and every child should see it. We have a collection of natural history and science content, not just in scale and having the majority of it that exists in every language, but a collection of content that every family and every child should watch, which is very differentiated from watching scripted [sic] series [and] movies.

"We have Chip and Joanna Gaines, and we'll be launching in 2020 with them with direct-to-consumer. And we have cycling and cars, and so we're going in these niches.

"We're looking at the strength of our IP in the U.S. in the aggregate, and '–… [are] talking to consumers [about] how much they love it. We see through our GO platform how young the people [are] that are using it and how much time they're spending with it. And we're now looking at how do we take that content. We're already doing it independently. Is there an opportunity for us to take that content on a broader basis to reach — to mount an attack on those that are not existing cable subscribers? That's the full ecosystem. That's what everyone is looking to do and needs to do, which is take the great IP and reach everyone. We want everyone to watch our content. – David Zaslav, CEO

"For those of you who have the app (Food Network Kitchen), which I hope is everybody on this call, we have Alex Guarnaschelli, Marc Murphy, Rachael Ray, Jeffrey Zakarian, and Bobby Flay over the next five days. Bobby Flay, I think, is doing three classes on Sunday. The consumer demand on the classes has been so high so far that we're actually going to make two changes: We're going to expand the number of live classes from 25 per week to 40. We're also happy to announce the opening of a brand-new Food Network Kitchen studio in Los Angeles. So, we're going to double. We have this Food Network Kitchen here in New York. We're going to double our capacity by opening up a studio in Los Angeles. That will allow us to serve customers all across the U.S. well, but also allow us frankly to add more and more classes over time. So, the live and on-demand classes we're very pleased with so far.

"David mentioned the partnership with Amazon has just been terrific. Most consumers in the U.S. will be on Amazon between now and the end of the year, as we have this big holiday shopping season, and I'm happy to say Food Network Kitchen will be featured prominently across the site. And that includes all the Alexa devices and it also includes the very popular Fire TV. So, Fire TV has millions of customers right now, and if you tune into Fire TV, front and center is Food Network Kitchen…. So, we feel like we're on the right track at this point, and net-net, we're very pleased with the first couple of weeks of results. – Peter Faricy, CEO, Global Direct-to-Consumer

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DISH Network

Summary: On the plus side, positive news from Dish, as the company had a net subscriber gain due to improved subscription to Sling TV; however, the Sling TV subscribers are less valuable at this time and, therefore, it hit overall revenue. The call did give some clarity on Dish's views on the upcoming year of direct-to-consumer OTT services, in addition to clarity on why Dish walked away from Regional Sports Networks.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote: "I'd like to first congratulate our team here for a solid quarter. It's the first period since the fourth of 20'17 that we've been able to announce total pay-TV net sub growth." – Erik Carlson, President and CEO


"We ended the third quarter with 148,000 total pay-TV net additions. Now, I recognize that we lost 66,000 net subs on DISH TV, but this is notable progress. Now, we've realized year-over-year growth in our DISH TV gross additions, 416,000 subscribers chose DISH in the third quarter compared to a year ago with 294,000 growth addition. The trend's not accidental. Obviously, there are both headwinds and tailwinds in the third quarter and it's fair to conclude that we both benefited, and …' [were] impacted by programming disputes across the industry. Again, we're adding the right customers in the right geographies and in aggregate additions in the quarter, [which] represents the highest average credit scores that we've seen.

"On the Sling side, we saw 214,000 net additions, largest growth we've seen since we started publicly announcing Sling Stat.

"We're pleased to see the FCC issued its order this week, approving the proposed T-Mobile-Sprint merger. The framework established by the FCC will facilitate and accelerate DISH inventory as a new nationwide facilities-based provider. Our goal is to spur competition and drive America's leadership in 5G — all of the benefit of American consumers and industry. With regard to our announced acquisition of Sprint's prepaid business, including Boost Wireless, we're moving forward, assuming that the T-Mobile-Sprint merger will close. Should the merger receive approval, we're confident in our day one plan for Boost, for its team, its partners, and its customers, we will be ready.

"J.D. Power named DISH number one in overall customer satisfaction among national TV providers for the second year in a row — the top honors in our category, earning the top ranking in all four geographic regions, and that's the first for a company in our industry.

Responding to the relatively small loss of subscribers in light of Dish losing the Regional Sports Networks (RSNs) to Sinclair:

"DISH's consumers are a little bit different. So, as many of you know, in regional sports, there's different zones and people in the cities tend to pay more for regional sports than people in the rural areas, but contractually Sinclair wants to go a little different route there. And so, there was a lot of complications. The biggest complication was [sic] Disney themselves, who had contracted the negotiations out [but] didn't extend the contract. We lost the highest value regional sports customers because the months of August and September are the highest viewed months for regional sports by a long shot.

"So, to beat down during that period of time, they felt that was negotiating leverage against us. And so, that's why they did it. In my opinion, because we lost our best customers … we couldn't pay as much money to put regional sports back up again. So, because our cost output for those viewers would go up and you're in a situation … we'd rather have a deal. We like Sinclair. We've had a long-term relationship with Sinclair. We like the company. We like the people there. We'd rather have regional sports, but we're, as a company, we're not going to subsidize. We're not going to subsidize regional sports. And so, there are economics that may not work for them, but there are economics. We know what the economics are for us. We actually analyze stuff.  The other thing is, you have to look at the macro environment.

Analyst adds that Disney is taking programming off of Dish and moving it to Disney Plus:

"And that doesn't increase their value to us, right? So, obviously that has to be taken [into] consideration [during] negotiations. Additionally, I would imagine that even regional sports, even teams themselves will probably stream directly and our customers get HBO a different way today. They don't have to get it from us. They can pirate it. They can use code-sharing. They can get it through another distributor, or they can get from Amazon. Our customers will be able to get regional sports and local channels when that comes up with Sinclair. They're just going to get it a different way

"But, having said that, we like to strike agreements that are good for both companies, and you have to make us leave kicking and screaming. But HBO did that and refused to negotiate a deal 'that we would not lose a significant amount of money on. They had a strategic reason because they wanted to grow subs at DIRECTV. And they have Game of Thrones coming up, so they had a valid strategic reason for wanting to do that. That reason may not be out there anymore, but that they certainly did that and Sinclair now, unfortunately — given Disney's decision not to extend the contract — is in a situation where 'they've got to make decisions. But if everybody has regional sports and we don't, and trust me, the vast, vast, vast majority of our customers don't watch a single second of any regional sports on our network. That's an advantage for us if that's the strategy we have to go down because we won't have to increase the prices to our consumers. And I know what's going to happen. Sinclair will start running — I've been through this so many times. Sinclair will start running adds saying you can't get this hockey team on DISH and you can get it on our competitors, and we'll run an ad that says you're paying more from our competitors because we don't have that hockey team that you don't watch. All right. And so, it will be more mindless stuff, but that's way things go, and we accept that, that's probably the logical thing that happened in this business." – Charlie Ergen, Co-Founder and Chairman of the Board

Responding to a question about an on again, off again rumor of a Dish-DirecTV merger/partnership:

"There is industrial logic for DISH and DIRECTV to be doing some things together. There is industrial logic for DISH and AT&T will be doing things together, but when somebody put the guns to your head with HBO and, as you will, new to carry HBO, you're going to lose money, that's not a door opener for us as a company. And this merger with T-Mobile and Sprint, we're focused on that." – Charlie Ergen, co-founder and Chairman of the Board

Responding to a question regarding the impact HBO Max could have on discussions with AT&T:

"HBO Max — it's interesting because I don't know everything they're going to do with HBO Max, but I think it's going to be a good product. I think that it will be tougher for linear distributors because, well, HBO was requiring, at least from us, guaranteed contract with a certain number subs and, obviously that's difficult to do when you're competing against HBO themselves, particularly if they dig in with a lot of the programing on HBO Max. It certainly will give leverage to distributors and future negotiations. And so, it's going to be really interesting to see how content providers navigate because people aren't going to watch more TV — I mean are not materially more. And there is lots of great programing out there and they're going to spend about the same amount of money, and it's going to be a lot of miles. And the best product in the country today is Netflix, and I think you heard Hastings talk a little bit about engagement and that's the key metric and it's not just Netflix. The fact that they're kind of a virtualized network as we've learned about it, they've actually got most of their stuff on the cloud, so they're actually more flexible and they deliver content cheaper than anybody can do it. So, you got to follow them and where it goes, I don't know, but I think it can take a couple of years to settle out." – Charlie Ergen, Co-Founder and Chairman of the Board

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Summary: This is the earnings call that preceded the launch of Disney+ on 11/12. Disney+ launched with over 10 million subscribers, although many of those came in via free seven-day trial and free one-year accounts based on Verizon Unlimited Wireless subscriptions. There were also significant tech glitches on the first day, which was considered a black eye, given Bob Iger's acquisition of BAMTech was made precisely to avoid those type of tech challenges. Nevertheless, it's considered to have surpassed expectations. Overall, the Disney business is strong.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote: "And I think what we're trying to do, as a company, is not to look at the apps as entities unto themselves but look at the apps as part of a broader production creativity distribution monetization play. What I mean by that is if you look at Disney or Disney Plus, you obviously have films that are monetized and two windows. First one is the theatrical window, then what I'll call the home video window, and then, they move on to this SVOD platform,' which is also a place monetizing the vast library.

"The same thing can be said for the television programing that we're creating, although a lot of it for Disney Plus will be original or exclusive to Disney Plus, although there's nothing to keep us from then putting some of it on maybe a Disney Channel down the road, but we're not looking at any of these [the] isolated way I talk about Hulu. But I also talked about it in the context of ABC of FX and at Freeform; interestingly enough, if you look at current viewing patterns of some of our hit shows on ABC, Grey's Anatomy, The Good Doctor would be two examples. "They are on ABC Live. Then they go through that Live Plus 3, Live Plus 7, or Live Plus 8 cycle. Ultimately, they end up on Hulu. By the end of the run of a show after one month, often these shows have tripled in terms of their consumption once they're made available on Hulu and that's only a month. It could be on Hulu for years to come. – Robert Iger, CEO


"As you know, we began this process with the acquisition of BAMTech, which gave us the means to implement our DTC strategy, putting us into the market quickly and ensuring we have the technology to deliver a quality experience. Our first effort was ESPN Plus, which was an immediate hit with sports fans when it launched last year and continues to deliver steady growth. I'm pleased to announce that as of today, ESPN Plus has over 3.5 million paid subscribers, were drawn toward unique and growing mix of original content like the legendary NFL PrimeTime with Chris Berman now exclusively on ESPN Plus, and exclusive live events including UFC, College Sports, domestic and international soccer, and Top Rank Boxing.

"Beginning in March, Hulu will become the official streaming home for FX Networks. FX on Hulu will include all seasons and more than 40 FX series and will offer episodes of current and new FX series immediately after the air on the linear network. Additionally, FX will produce original series exclusively for FX on Hulu, starting with four new series in 2020: Devs from Alex Garland; Mrs. America, starring Cate Blanchett A Teacher, starring Kate Mara, and The Old Man, starring Jeff Bridges and John Lithgow.

"At launch, Disney Plus users will have immediate access to more than 500 movies, including all of our beloved titles and more than 7,500 episodes of library television content, including 30 seasons of Simpsons. By year five, this growing collection will include more than 620 movies and more than 10,000 television episodes, along with countless shorts and features. At launch, [it] will offer 10 original movies, specials, and series exclusive to the platform, including The Mandalorian. Within a year of launch, the amount of original content on Disney + will increase to more than 45 series, specials, and movies and will expand to more than 60 original projects per year by year-five.

"Consumers can directly subscribe to the service for $6.99 a month or $69.99 a year at disneyplus.com. And starting November 12, they can access the service through a growing variety of partners and platforms, including Apple, Google, Microsoft, Sony, and Roku. And today we're pleased to announce additional distribution partnerships with Amazon Fire, Samsung, and LG. Disney Plus will also be available in a bundle with ESPN + and ad-supported Hulu for $12.99 a month.

"Our studio had another great quarter and a phenomenal year. In the fourth quarter, operating income was up 79 percent, driven by growth in worldwide theatrical due to the performance of The Lion King, Toy Story 4, and Aladdin in the quarter, compared to Incredibles 2 and Ant-Man and the Wasp last year. The increase in operating income was partially offset by about a $120 million loss at the 21CF studio business, which was driven by the performance of Ad Astra, The Art of Racing in the Rain, and Dark Phoenix. The loss from the 21CF Studio business was about $100 million higher than the loss we estimate the business generated in Q4 last year.

"Turning to media networks, operating income was down 3 percent due to declines at cable and broadcasting, though results came in better than what we expected at the time we reported Q3 earnings. Lower cable results reflect a decrease at ESPN, partially offset by the consolidation of the 21CF cable businesses. At ESPN, higher programming and production costs, driven by contractual rate increases for NFL, college sports, and MLB programing, and higher marketing expenses related in part to the launch of the ACC Network more than offset growth in affiliate revenue.

"ESPN's domestic linear advertising revenue was down two percent in the fourth quarter and so far this quarter, ESPN's domestic cash ad sales are pacing up three percent compared to last year. At broadcasting, results in the quarter were adversely impacted by lower program sales compared to last year. We sold two Marvel series, Daredevil and Iron Fist, during Q4 last year and we didn't have comparable sales in the fourth quarter of this year. We also had lower sales of Blackish in the quarter compared to last year. The difficult program sales comp, coupled with higher programming expenses at the ABC Television Network and lower TV station ad revenues were largely offset by the consolidation of the 21CF broadcasting business and higher affiliate revenue.

"Ad revenue at the ABC Network was up modestly in the quarter. Quarter-to-date prime time scatter pricing at the ABC Network is running 47 percent above Upfront levels. Total media affiliate revenue was up 18 percent in the fourth quarter and reflects the consolidation of 21CF and growth at both cable and broadcasting. The increase in affiliate revenue was driven by 15 points of growth from the acquisition of 21CF and seven points from higher rates, partially offset by a four-point decline due to a decrease in subscribers.

"First, we expect our direct-to-consumer and international segment to generate about $800 million in operating losses for the quarter. We expect the continued investment in our DTC services, specifically Disney +, which will launch in just a few days, and the consolidation of Hulu to drive an adverse impact on the year-over-year change in segment operating income of our direct-to-consumer businesses of approximately $850 million.

"Well, Hulu is a significant driver of advertising revenue and we will continue to be, particularly as we grow Hulu out to essentially the guidance that we had given back in Investor Day, that basically ad supported Hulu [and] has very high ARPU. Which is one of the reasons that it's being bundled with ESPN Plus and Disney + for that $12.99 price because the value of an ad-supported Hulu subscriber, given the advertising revenue that it drives is very, very high. ESPN, there are also opportunities for growth, but probably the biggest opportunity is on the Hulu front.

"The demographics were far broader than a lot of people expected them to be. This is well beyond kids and family; clearly, where this is a four-quadrant product, with adult men and women, as well as kids and families watching or using the service.

"As it relates to your first question, which I guess is consumer choice, consumer confusion. I think a lot about it, as it relates to [sic] website consumption patterns and even the current app patterns where no two people use the same websites or the same set of apps. …Obviously a lot of overlap with the most popular ones and then there's a lot of fragmentation. I think you're going to see that in these of good video-centric or program-centric apps where they're going to be halves and lesser halves, they're going to be a lot of them available and they'll have varying levels of consumption and the viewer, or the consumer will be able to navigate basically relatively easily because they're easily too easy to find. Hopefully they'll be easy to buy or use and they'll be easy essentially place on mobile devices and on desktops and I actually think that if you're thinking about just these TV and movie apps or whatever you want to describe them, they're probably going to be fewer of them. Then there are apps for games and apps for in everything else that you're doing internally use. So, I know it's not a concern.

"Do you believe think, though, that brands will matter? As we've been saying, as a company for a long time, if you're in a list of choice for sports and you have ESPN on as your name or other kind of product and says Disney or the other brands, I think that immediately rises to the top of the list in terms of consumers' interest. And because of the recognition factor and they trust, they have in these brands. – Robert Iger, CEO

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Summary: The political season and the impact/challenges of Facebook was the overriding topic of Q3. While other social networks like Twitter have announced that they will not take political ads, Facebook has been adamant that they will continue to accept political ads but put a more vigorous review process in place to ensure that fake news is not used in the process.  Year-over-year revenue was up 43 percent and Facebook gave credit to the success of the Oculus Quest VR headset for this boost.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote: "Ad revenue grew 28 percent year-over-year and we saw strong performance in all regions and on both Facebook and Instagram. Mobile ad revenue was $16.4 billion, contributing approximately 94 percent of total ad revenue." – Mark Zuckerberg, Founder and CEO


"There are now 2.8 billion people using Facebook, Instagram, WhatsApp, or Messenger and around 2.2 billion people using at least one of our services daily.

"We launched a number of new, exciting products like Facebook Dating in the U.S., which is doing quite well; Threads for Instagram, our camera first experience to share with your close friends; Facebook News, our dedicated product for news that we built in partnership with news publishers; and we introduced Horizon, a new social experience for VR. We also released hand tracking technology for Oculus and Oculus Link, so your Quest is basically now a Rift too.

"Today is certainly a historical moment of social tension and I view an important role of our company as defending free expression. Now, this has never been absolute and, of course, we take our responsibility to prevent harm very seriously, too. I think we invest more in getting harmful content off our services than any other company in the world. Those who follow us closely know that we have more than 35,000 people working on safety and security, and that our budget for this work is billions of dollars a year — more than the whole revenue of our company at the time of our IPO earlier this decade. And we're going to keep on investing more here.

"But while we work hard to remove content that can cause real danger, I think we also need to be careful about adopting more and more rules that restrict the way that people can speak and what they can say. Right now, the content debate is about political ads — should we block political ads with false statements or should be block all political ads. Google, YouTube, and most Internet platforms run these same ads. Most cable networks run these same ads and, of course, national broadcasters are required by law to run them by FCC regulations. And I think that there are good reasons for this. In a democracy, I don't think it's right for private companies to censor politicians or the news. And although I've considered whether we should not carry these ads in the past, and I'll continue to do so, on balance so far, I've thought that we should continue. Ads can be an important part of that voice, especially for candidates and advocacy groups that the media might not otherwise cover, so that they can get their message into debates.

"Some people accuse us of allowing the speech because they think that all we care about is making money and that's wrong. I can assure you from a business perspective the controversy that this creates far outweighs the very small percent of our business that the political ads make up. We estimate that these ads from politicians will be less than .5 percent of our revenue next year.... So, the reality is that we believe deeply that political speech is important and that's what's driving this.

"We don't let any of our newsfeed or Instagram feed teams set goals around increasing time spent on our services. We rank feeds to encourage meaningful social interactions, helping people connect with friends, family, and their communities. We've taken many steps over the years to fight clickbait and polarization, and now we're even testing removing like counts on Instagram and Facebook.

"Last year, you'd probably remember that we made a series of changes that emphasized friends and family and reduced time spent on our services. The one change removed 50 million hours of viral video watching a day, and we did this knowing it would mean that people would spend less time on our apps.

"''"So, over the next year of campaigns, we're going to be at the center of the debate anytime there's content or policies on any of our services that people believe could advantage or disadvantage their side. This may lead to more investigations and the candidates are going to criticize us. I expect that this is going to be a very tough year. We try to do what we think is right but we're not going to get everything right. This is complex stuff and anyone you said that the answers are simple hasn't thought long enough about all the nuances and downstream challenges." – Mark Zuckerberg, Founder and CEO

"We're continuing to invest in people and technology so that we can disrupt networks of bad actors, find and remove that content, and stop fake accounts before people see them. We're also making political advertising on Facebook more transparent than anywhere else. In 2018, we started requiring ads about social issues, elections, or politics to get authorized before running. And this quarter, we strengthen those requirements to ask for even more information. Helping people understand who is trying to influence their vote without becoming arbiters of political truth ourselves is critical to empowering people and keeping them safe.

"Earlier this year, we reached an important settlement with the National Fair Housing Alliance, the ACLU, the Communication Workers of America, and others to restrict targeting options for housing, employment, and credit ads. Now, advertisers in these areas are required to use a new buying process and by the end of the year people will be able to view all current housing ads in the United States.

"Messaging is one of the fastest growing areas for online communication and especially between businesses and people. We've seen businesses use Messenger to reach customers, generate new leads, and even sell cars. For example, French automaker Renault used a combination of Instagram stories and click to Messenger ads to drive sales of a limited-edition vehicle, the Captur Tokyo. Facebook was their only advertising channel and over the span of 30 days, they sold 100 cars, 20 directly through Messenger. This quarter, we added a click to Messenger feature in stories so businesses can grab some of the attention in stories and then continue the conversation.

"According to eMarketer, 63 percent of Internet users surveyed in the U.S. say they've tried an augmented reality experience created by a brand. To help advertisers experiment with this, we launched a small beta test this quarter. As part of the test, we make up an Italian cosmetics brand, used their ads to give people an easy way to try on different shades of lipstick, and they saw a 27 percent lift in purchases." Sheryl Sandberg, Chief Operating Officer

"We were pleased with the growth of the Facebook Community this quarter: daily active users reached 1.62 billion, up 9 percent compared to last year, led by growth in India, Indonesia, and the Philippines. This represents approximately 66 percent of the 2.45 billion monthly active users in September.

"MAUs grew 8 percent or 178 million compared to last year. We're pleased with the growth trends in all regions, including the U.S. and Canada. In terms of our family metrics, we continue to grow and estimate that, on average, around 2.2 billion people used at least one of our apps on a daily basis in September and around 2.8 billion were active on a monthly basis.

"Q3, total revenue was $17.7 billion, up 29 percent or 31 percent on a constant currency basis.

"Q3 total ad revenue was $17.4 billion, up 28 percent or 31 percent on a constant currency basis. In terms of regional ad revenue growth, APAC and rest of world were strongest and grew 35 percent and 34 percent, respectively. APAC got more of a revenue lift from our recent product optimizations, while rest of world benefited from favorable macroeconomic trends, compared to the weaker environment in Q3 of last year. North America and Europe grew 27 percent and 24 percent, respectively.

"In Q3, the number of ad impressions served across our services increased 37 percent and the average price per ad decreased 6 percent. Impression growth was primarily driven by ads on Facebook News Feed, Instagram Stories, and Instagram feed. The year-over-year decline in average price per ad was primarily driven by the ongoing mix shift toward geographies and Stories ads, which monetize at lower rate.

Financials and outlook

"Payments and other fees revenue were $269 million, up 43 percent. This year-over-year growth was driven primarily by sales of new products, notably Oculus Quest. Total expenses were $10.5 billion, up 32 percent. We ended Q3 with approximately 43,000 full-time employees, up 28 percent. Operating income was $7.2 billion, representing a 41 percent operating margin. We continue to expect a more pronounced deceleration of our revenue growth rate in Q4. We expect our Q4 reported revenue growth rate will decelerate by mid to high single-digit percentage compared to our Q3 rate. This deceleration is largely driven by the lapping of several successful product optimizations in Q4 of last year, as well as ad targeting-related headwinds. Since these factors are largely unique to Q4, we would expect our revenue growth deceleration in 2020, versus the Q4 rate to be much less pronounced."

"In Q4, and over the longer term, we do continue to expect to face ad targeting-related headwinds and uncertainties. And I just go back to the three factors that I cited in the past that the regulatory landscape is continuing to evolve. So, for example, when GDPR came into effect, we saw a number of people who opted out on allowing us to use context from the apps and websites they visited for ad targeting.

And then the second factor is just we're seeing proposed changes from the mobile platforms that are more oriented toward privacy, which could affect targeting and measurement and make that more difficult. And then, finally, we are rolling out our own product changes such as the recent launch of OSA, that's our user control on what data stored on Facebook activity. So, I'd say those three factors still factor in. And when it comes to this, I'd say the majority of the potential signal loss is still in front of us, rather than behind us. So, I think those headwinds are still real and out there and that factors into our outlook as well."– Dave Wehner, Chief Financial Officer

Responding to a question regarding Instagram Shopping:

"We think there is a big opportunity over the long run here because more than 90 percent of Instagram users are following a business. But on the shopping product itself, it is still very early days and we're working to improve the product and it's quite small. We started testing, in Q3 shopping ads, the idea that shoppers can tap on ad, see a product description page and can purchase from the business' mobile site.

"Our overall commerce efforts go across not just Instagram, but Facebook and all of our properties, and our goal is to make it more convenient and accessible and secure for people and business to browse, discover, buy, and sell. I think we have been and continue to be a great place for people to browse and discover. That continues to drive the great, great majority of our business and well for the foreseeable future. But as we can help people reduce friction and close that loop, we think that's a good opportunity for people and for our business." – Sheryl Sandberg, Chief Operating Officer

"Yeah, I think in terms of our core advertising products and growth, it's worth really remembering that our core feed products for Facebook and Instagram are growing nicely and well. And we see a lot of opportunity to continue that growth. Definitely, Stories is a big part of the success. We've had, I think, a lot of success moving advertisers to where people already are. That's what happened with mobile ads. 

"Of our more than 7 million advertisers, we already have 3 million [ads] across Facebook, Instagram, and Messenger Stories. And I think that's because we learned that we have to do a lot to help them move. For example, advertisers can now buy Stories across Facebook, Instagram, and Messenger all at once. We had automatic default templates, which convert your feed ads into vertical Stories format and this quarter we just launched customizable templates, which help you save time and resources. As we have to help advertisers move, we've learned how to make those investments in making the formats really easy, the measurement really easy, the buying really easy. Stories still does monetize at the same rate as a News Feed right now. So, we're keeping an eye on that. But the growth over the long run is pretty exciting." – Sheryl Sandberg, Chief Operating Officer

Responding to a question regarding privacy laws in the U.K. and U.S.:

We've seen adoptions around people who are opting out of allowing us to use context from the apps. I'd say that was largely within the range of expectations that we saw, and it is having an impact, and the people who are opting out are seeing less relevant ads. And, obviously, that will impact both, I think, the quality of the experience in terms of the ads they get and also the monetization for us. I think that is kind of playing out as we expected.

CCPA, I think, is still a work in progress. We're watching the developments on that closely. That's the California Consumer Privacy Act, and that has many similar provisions to GDPR, but it's a different line. We're going to have to watch how that evolves, but we do think that that's a factor that we're watching closely, and we'll just have to see how that develops."  – Dave Wehner, Chief Financial Officer

"And then also just add something on privacy. I think it's very important that there is federal privacy legislation. GDPR encodes a lot of important principles and in order for businesses to be able to operate, especially to get started and keep the market competitive, you want to make sure that there aren't 50 different regulatory frameworks that companies need to follow. I mean, we could handle that if we needed to, we're a big company. But in terms of for the market overall, I just think it would be a lot better if we had a very clear set of rules at the federal level on privacy. We'll continue to try to work with folks to try to do what we can to help there." – Mark Zuckerberg, Founder and CEO

Responding to a question around AR/VR:

"This is taking a bit longer than we thought. And I'm still optimistic. I think that the long-term vision and the reasons why I thought this — we're going to be important…. We're seeing a lot of people use these products and love them and because of that I think that we're still going to get there. On the one hand, that, of course, means that the future might be a few years further out and that it might be more expensive to develop because we'll be funding this for a bit longer until it gets there. But, on the other hand, from our perspective, we're not a company that's traditionally done hardware or built operating systems or these kinds of products. So, every year that we get to practice and get better and build our brand around Oculus in terms of building the best products that we can in this space, I just think that we're going to be better off when this is really ready to be a completely mainstream thing with hundreds of millions of people using it."

"You're right that Quest is growing and doing quite well. We are selling them as fast as we can make them. – Mark Zuckerberg, Founder & CEO

Responding to a question about anti-trust and also reminiscing about the acquisition of Instagram:

"Back in 2012, people generally didn't think of Instagram as competing with our core service. We thought about Instagram in the context of this new mobile camera space that was complementary. We thought that mobile photos we're going to be important. So, we were competing there with things like Facebook camera, but we ultimately thought that we were going to do better work if we were building with Instagram. It wasn't a full featured social network itself. It only had about 30 million people using it at the time. At the end of the day, the FTC makes its judgment on what we can do, the FTC had all this context when they made this decision in 2012. And the reality is, it ends up being a lot more complementary than I think we ever expected. But it also wouldn't be what it is without everything that we put into it and whether that's the infrastructure or our advertising model or spam and safety services and a lot more. "– Mark Zuckerberg, Founder & CEO

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Summary: Going strong, Google introduced several new ad products, including AI – optimized bidding, dynamic creative for search ads, YouTube Masthead ads for TV, and an upgrade to Google Analytics that unifies web and app performance metrics.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote: "While our mission to organize the world's information and make it universally accessible and useful, [it] hasn't changed. We have evolved from a company that helps people find answers to a company that helps you get things done.


"Powered by our long-term investment in AI, we dramatically improved our understanding of the questions people ask Google search. It's the biggest leap forward for search in the past five years. It's all possible because of a new type of neural network-based technique for natural language processing called BERT, which recognizes subtle patents in language and provides more relevant results.

"We recently announced a major Quantum Computing milestone. It was extraordinarily proud to visit our team in Santa Barbara. To demonstrate supremacy, Google's 53-cubic quantum machine Sycamore successfully performed a test competition and just 200-seconds that would have taken the most powerful supercomputers much longer time to accomplish. It's the Hello World moment we've been waiting for and represents a distinct milestone in our effort to harness the principles of quantum mechanics to solve computational problems.

"We announced a landmark partnership with Mayo Clinic, using Google Cloud to secure and store data and understand insights at scale. Mayo Clinic will partner with us in many ways. Together, we'll work to transform patient and clinician experiences, identify new methods of diagnosing diseases, conduct clinical research, and find new models for delivering patient care.

"We announced a cloud region in Nevada; when it launches in 2020, it will be our seventh Cloud region in the U.S. We also announced a new Cloud region in Poland, our seventh in Europe.

"We are excited about new features launched in maps, including detailed voice guidance while walking that will make it possible for people who are vision impaired or are blind to get around more easily.

"In search, we made a number of improvements to make it easier for users to find key moments and videos, to easily find products with images via Google Lens and discover new podcast.

"Keeping YouTube safe for our users, creatives, and partners, while preserving the openness of our platform is our top priority. This quarter we continue to update our community guidelines and enforcement to protect users from harmful content and we'll keep doing this work.

"In September, YouTube launched its new fashion and beauty destination called YouTube/Fashion. It's designed to meet the growing demand from consumers for better ways to explore and connect with some of YouTube's biggest fashion and beauty creators.

"We are bringing our strengths in machine learning to help advertisers build their ad campaigns. Machine learning power tools like search auto bidding are gaining traction. In fact, more than half of advertisers' search spend is now optimized via full auto bidding.

"We now have more than a million advertisers using responsive search ads, an ad format we launched a year ago that uses machine learning to create the right ad for each search query. And our new video reach campaigns allow marketers to upload multiple video ads into a single campaign. From there we use machine learning to serve the most efficient combination of these ads to help brands reach audiences at scale.

"This quarter we expanded inventory for our very popular app campaigns to include new surfaces, including YouTube search display video ads on the Discover feed. We also launched YouTube Masthead ads for TV, which enable advertisers to reach audiences right when they open the YouTube app on the connected TVs, one of its fastest growing screens. It's also important for advertisers to have standardized measurement that's fair across all media and that delivers insights in a way that fully protects user's privacy. We're making it easier for businesses to do just that.

"Our next generation of Google Analytics unifies web and app measurement reporting for the first time to help businesses understand which channel is driving the best results.

"Just a few weeks ago, we announced that our IT professional support certificate training course will expand to 100 community colleges. It's already helped tens of thousands of people to pursue fast-growing, well-paying careers in IT support. – Sundar Pichai, CEO

On financials:

"In the third quarter, total revenues of $40.5 billion were up 20 percent year-on-year and up 22 percent in constant currency. Once again, our results were driven by ongoing strength in mobile search, YouTube, and cloud. Operating income was $9.2 billion, up 6 percent year-over-year for an operating margin of 23 percent.

"Within other revenues, in addition to continued strength in compute, Google Cloud saw substantial growth from data analytics, as customers are seeing the benefits from implementing big query. Cloud continued to see significant growth in each region globally.

"As we've said since the IPO, we don't manage the business to maximize quarterly results and 'will always do the right thing for the long-term. We're very focused on investing for the long-term and tried to make it clear in opening comments that, as a result, quarterly growth can vary and has varied. – Ruth Porat, CFO

On the "Other Bets" division, Innovation:

"Other Bets had an operating loss of $941 million. I'll note a couple of key accomplishments in Other Bets. At Waymo, we're extending fully driverless opportunities on a small scale to participants in our early rider program in Metro Phoenix. We're also testing long haul truck driving on Arizona freeways. We're continuing to test Waymo vehicles in various geographies, the newest of which is heavy rain testing in Southern Florida. In addition, we have begun 3D mapping in Los Angeles.

"Wing launched its first commercial drone delivery service to homes in Virginia in partnership with FedEx, Walgreens, and local Virginia retailer Sugar Magnolia. Wing is now operating on three continents in early test deliveries. – Ruth Porat, CFO

Responding to a question on small business:

"Local is an important area for us and we are continuing to invest in building our experience that connects merchants, advertisers, and users. Google My Business has been our major effort there to the millions of businesses and reach and engage both to search and maps. We want to make it easier for advertisers, particularly SMBs, to come to Google and be able to reach users across our set of owned and operated properties. So, be it Search, be it YouTube, be it Discover, be it Maps and that's the way we envisioned that. But small and medium business is a big area of focus and Maps represents a big long-term opportunity for us." – Sundar Pichai, CEO

Responding to a question on Google Discover:

"Discover is a product we are very excited about. I think it completes the other half of Search. Search is … our mission for our users and helpful when they come to us looking for information. Discover the other half where we are proactively understanding what might be most helpful or relevant to them and getting it to them. And we definitely are focused on product quality and making sure the product is actually helpful to users and when they engage with it, they find it useful. Our investments in machine learning are helping, as well. We're definitely able to better anticipate and give them information proactively. So, over time, I see it as an important area for us and it's done in close, it's part of our search and knowledge efforts, and as we do that, you can imagine, you may have started a query in search and it's a session maybe looking to take a trip somewhere or you're researching a particular topic. We may be able to continue that session and the user journey in Discover and that creates a virtuous cycle. – Sundar Pichai, CEO

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Summary: iHeartMedia, like all of the other audio companies, are projecting real optimism around podcasting and programmatic.

Top Quote:

"Our number one priority is getting new advertisers to try us. And the more platforms we have, the more reasons they have to give us a try. Podcasting is the fastest-growing of these platforms."


"Audio has never been hotter, and iHeartMedia has leadership across all major platforms: broadcast radio, streaming radio, podcasting, and social. We reach audiences on more than 250 different platforms, and that's 2,000 devices with approximately 135 million registered users, 20,000 live events, and 211 million fans on social media.

"Consumers spend 30 minutes a day with us, on average, whereas Google and Facebook's audiences averaged 26 and 18 minutes per day, respectively.

"Building on that reach and engagement, we've begun to see a shifting of media mix from other sectors toward audio. The most prominent example of this has been Procter & Gamble, who've been a vocal leader about their shift back to radio and which just matched its strongest quarterly sales growth in over a decade.

"Radio's reach has remained constant, above 90 percent dating back to the 1970s, while TV steadily declined from 95 percent in the early 2000s to 86 percent today.

"The podcasting industry is growing rapidly and shows no signs of slowing down. In fact, the Forrester Research report that was published earlier this week estimated that the podcasting industry could reach $1 billion by the end of 2020. And iHeart is the number one commercial podcast publisher based on Podtrac's rankings, which are the industry standard for measurement.

"Our podcasting business is not only growing revenue but it's also profitable. Podcasting today is accretive to our total company margins. That's because we own our content and because we use our broadcast radio inventory to build demand for our podcast. This new revenue stream is incremental to our broadcast radio revenue.

"We continue to expand our [podcast] offerings with major talent that includes Shonda Rhimes, Will Ferrell, and Chelsea Handler, as well as major podcast brands like Stuff You Should Know, the most downloaded podcast of all time, and podcasts from our iconic radio talent, like The Breakfast Club, Bobby Bones, Elvis Duran, and Colin Cowherd.

"Our third quarter performance reflects progress we made against each of our three revenue opportunities, which are: one, increasing our share of radio advertising spend; two, continuing to tap into the revenue pools of TV and digital advertising; and three, building new revenue opportunities coming from podcast and sponsorship.

"Our results reflect our execution against these three initiatives, as we grew total company revenue by 3 percent, compared to a mid-term election year in 2018. Excluding the impact of political, revenue grew almost 5 percent year-over-year. This revenue growth was driven by strong performance across all our revenue streams, each of which grew year-over-year, excluding the impact of political revenue. Digital had another strong quarter, up over 33 percent year-over-year, and networks also grew year-over-year by 9.2 percent. And we continued to see strength in our broadcast segment, which outperformed the broadcast radio market and was up year-over-year, excluding political.

"We continue to work with advertisers to build unique marketing solutions that include audio. By doing so, we're bringing money that wasn't previously earmarked for radio into our revenue pool. We also have an opportunity to solve advertisers' problems with TV's declining reach and its large segment of light viewers by adding radio to the mix. Another way we're expanding our addressable market is with our automated self-serve advertising product called AdBuilder, which is now in beta. AdBuilder creates customized audio ads for advertisers using proven techniques to get their businesses heard based on information the advertisers share about the businesses. Once an advertiser has listened to the professionally written and recorded ad, approved it, and decided on a budget and dates, AdBuilder's automated process then creates a media plan that connects the ads to the right people in the right time. We do want to be clear, however, that we expect the adoption period to be very gradual over the next three years to five years before it begins to reach critical mass" – Robert Pittman,

Responding to a question about spot local radio vs. network radio:

"In terms of the overall advertising environment for spot [radio], look, you guys know as much as we do. That's out there. It still continues to feel pretty good. We've seen strength in things like telecommunications, financial services, media, and publishing, and you saw we had 4.9 percent revenue growth, excluding political.

Responding to a question about what's driving broadcast revenue:

"We don't think about it as just watching rates. Unlike the TV business, we have a lot more inventory than they do. And we have some day parts like overnight, they're probably, if we're lucky, 30 percent sold out, but we still have a lot of volume opportunities. And if you look at our biggest opportunity, what will help us is SmartAudio. If we can get the data and analytics in and get more advertisers buying impressions, which is a trend, and you've seen some of the announcements out there in the marketplace, it will allow us to sell through all of our day parts to get the impressions, which is the biggest opportunity we've got in broadcast revenue. I think people are seeing it as a solution to some of the problems they're having in digital, some of the issues they've got in TV, and they're not going to give them up. But what they're going to do is add more radio to the mix in order to get more reach, in order to get more cost efficiency, and, in many cases, to get a unique impact in terms of bottom line." – Robert Pittman, CEO

Responding to a question on self-serve

"There are, I think … 7 million small businesses in the U.S. We have 60,000 accounts. I think if you look at Facebook,' how many have they announced? They've got about 7 million accounts compared to our 60,000. And I think the majority of their revenue comes from those small accounts. So, we think the long tail will be very important to us. It's going to take a while to get the adoption, and we're committed to growing that, investing in it, and seeing the results." – Robert Pittman, CEO

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Summary: While Netflix beat subscriber growth estimates (predominantly on global, not U.S. growth), their admission that the onslaught of new SVOD services, aka AppleTV+, Disney+, HBO max, Peacock, and others, will impact their meeting their end of year targets, is a real sign that the game has, and will, continue to significantly change for Netflix.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote: "And then, lastly, there is obviously a few competitors launching in the near term, and we try to factor that in, as well. Inevitably, there is probably going to be some curiosity and some trial of those competitive service offerings. So, when we put all that together, again, we adjusted our forecast slightly. It's still nearly 27 million paid net adds for the year — a tremendously strong year. - Spencer Neumann CFO

"In the prior year, in the U.S. we did 5 million net adds. And this year, we're on forecast for 2.6 million. So, the gap's almost entirely in the U.S.  That's really on the back of the price increase. There's a little more sensitivity. What we have to do is just really focus on the service quality, make us must-have. I mean we're incredibly low-priced compared to cable. We are winning more and more viewings. And we think we have a lot of room there." - Reed Hastings, CEO

"…'In the fourth quarter alone, we're talking about films that range from a massive scale action film, from Michael Bay with '6 Underground' to Oscar hopefuls like 'The Irishman', 'Marriage Story', 'The Two Popes', and Eddie Murphy's return in 'Dolemite.'

"So, these are big, theatrically ambitious-type films that you'll be able to watch on Netflix, included in your subscription. It really is a fundamental change in the economics of how people enjoy films.

"So, that incredible slate that I just rattled off to you, it's happening at the same time that we have returning seasons of End of the F****ing World, The Crown, Lost in Space, You, all incredibly popular shows. Casa de las Flores from Mexico, Baby from Italy, all back for returning seasons.

Responding to a question on rising content costs:

"But on a very competitive show, there's probably been 30 percent price escalation from this time last year…." - Theodore Sarandos, Chief Content Officer

Responding to a question about the importance of franchises and established IP:

"I think established IP has a leg up with consumers. They know what they're getting into. There's a prebuilt-in excitement. It makes the marketing a little easier. But, in general, don't forget the power of brand creation. And what is the value of a franchise? It's really the value of brand creation and can you scale off it. In this past quarter, we made a movie called Tall Girl, a hugely unknown cast, who, in 7 days, grew their social media following into the millions on Netflix and had over 40 million people watch it.

"We see the value of franchises like Stranger Things and Black Mirror.

"And so, we're continuing to work to do that as well. But I think about it as not like franchises are better than non-franchises. Great stories are what matter, and the way that they reach consumers really makes a difference." - Ted Sarandos, Chief Content Officer

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Outfront Media

Summary: Outfront had a good quarter. Canada was down slightly year-over-year, but only because Q3 2018 benefited from the Canadian legalization of marijuana. They continue to build out their digital signage products, in particular, in NYC with the MTA.

Q3 Stock Trend (Source: Yahoo Finance)

Top Quote:"We expect 2019 to be a double-digit revenue growth year, a noteworthy performance is being driven by digitization, sales execution, and certainly the growing importance of out-of-home in advertisers' media mix." – Jeremy Male, Chairman and Chief Executive Officer


"Total revenues increased over 11 percent in the quarter, which was our fourth straight quarter of double-digit growth. In U.S. media, we saw this double-digit performance in both local and national. We were delighted to see these twin sources of demand drive continued strong growth in both billboard and transit. This top-line strength helps drive OIBDA, up over 8 percent, and AFFO, up 7 percent.

"In billboards, revenues grew 8 percent on both reported and organic basis. This is on top of the 6 percent growth in the third quarter of last year. Billboard saw a strong contribution from digital, and we're encouraged to also see static billboards performing well. Transit revenues were up 20 percent, led by digital both in terms of dollar and percentage growth. While the majority of this growth was from New York City, we had great performances in all of our key transit markets.

"First, we are getting a nice lift on static billboard yields, which are 80 percent of total billboard revenue. We're also growing our digital yields and converting more billboard inventory to digital.

"Year-to-date, we have built or converted 77 and, including third-party marketing agreements and acquisitions, our total digital billboards have increased by 144. " - Jeremy Male, Chairman and CEO

"Turning to the MTA, deployment has started once again. We installed 900 displays, 62 percent of which were advertising and almost all of this deployment was in key Manhattan stations. We also began installing on the commuter rail platforms. Our total deployment as of September 30 approached 3,700 displays, and more than half of these now carry advertising, which will increase as a proportion over time to our stated goal of 85 percent of total screens. – Matthew Siegel, Executive Vice President and Chief Financial Officer

"On both the local and national level, our sales force is our competitive advantage. We have been investing heavily in our teams, training, compensation, brand marketing, and operations. Another key growth driver is transit digitization. This is already giving us a significant acceleration in our revenues and we expect growth to continue from additional displays, including rail cars in New York later next year.

"Digital billboards are another key growth area where we want to increase our exposure through conversions, marketing agreements, and acquisitions. We're seeing great returns, and we also believe … incremental revenue potential as the industry begins to trade its inventory in a more automated way. Traditional static billboards are also hugely important to us, as they represent half of our revenue and are delivering rising yields. There's no doubt at all that they are becoming more important in the media mix both from the growth rates we're seeing and the attention they are garnering in the industry.

"This Fall, Facebook published a study that showed that Facebook and out-of-home complement each other, allowing advertisers to reach audiences at all stages of the sales funnel, and how specifically out-of-home drives discovery with gen Z and millennials.

"Around 35 percent of the U.S. industry revenues are from independent operators, a good portion of these are in markets where we already operate and want to add some weight. We've been active in this tuck-in market and expect to continue adding to our portfolio in the future.

"We and the industry are far more able to provide data and insight into the audience that are interfacing with our media. And this, combined with increased trading automation, will provide a significant tailwind as we look forward.

"What's interesting is that if you look at Q3 in dollar terms in terms of dollar growth, our three top categories were financial services, professional services, which is, for the most part, actually locally driven and retail. So, maybe not the sort of growth drivers that you would think." - Jeremy Male, Chairman and CEO

"We're having some great conversations with our larger advertisers where we believe that we may see some benefit, obviously from the streaming wars that are going on. We think that could be positive for out-of-home because most of the streaming services are big friends of out-of-home. We think that 5G could be interesting as we move forward. And I guess the other point is that, we're still really driving some solid local advertising growth. It's 55 percent or whatever it was in revenues in Q3. And when you drill in there, we think a lot of that is actually — seriously, just about our execution is going out with a core message that's really resonating with local advertisers, which is about out-of-home, it's about mobile, it's about social. In other words, how out-of-home can really sort of boost our business." -  Matthew Siegel, Executive Vice President and Chief Financial Officer

"The first is, in terms of, our inventory, currently on programmatic exchanges. At the moment', after all it's relative to the $450 million of revenue in the quarter, it's a handful of dollars, but it's starting to grow, and that's terrific. Then, in terms of our own platform, as you know, we've been investing in a product called smartSCOUT, which is a planning and buying tool. At the moment, the planning piece of that is currently in use. It's in use within beta, formed by our national sales team, and we're testing in a couple of local markets, and what that's about and is basically we can kind of get much more granular detail in terms of audience delivery of each of our boards. Now, we haven't yet, but we will be plugging on the buy button, if you like on to that planning tool as we go forward. And that's something we haven't done yet, but we're utilizing smartSCOUT as a real provider of data and insight when we're going out and having discussions with our advertisers today."

"Not every digital board is equal. So, when we build a digital board on the West Side Highway, we're going to get a much different yield to building digital billboard in Tampa, for example. So, part of it is where we are building the boards out and, if you've been around New York City lately, you will see that we've been building some great boards. So, that's obviously that impacts slightly. It's not a balance sheet issue for us, Ben. It's really more about how we can create those opportunities because zoning is still a gating factor. So, we keep one eye on zoning, and we also just keep one eye on demand in a particular market because we obviously don't want to develop boards where there wouldn't be sufficient demand and, essentially, we may be eating our own lunch. So, those are the two things, we take into account. But we feel good about our prospect for continued … digital billboard developments in 2020." - Jeremy Male, Chairman and CEO


Summary: Roku missed analyst expectations for the quarter, reporting a loss of $.22/share, worse than the $.18/share loss that had been expected. During the call, Anthony Wood, CEO, explained that, although they acquired the DSP, Dataxu, Roku will continue to work with other DSPs. Roku also believes that the launch of the new streaming services (Disney+, HBOMax, Peacock, etc.) will be good for the OTT environment, overall driving budgets that have been traditionally going to linear TV advertising into the OTT space.

Q3 Stock Trend (Source: Yahoo Finance)

Top Quote:"There is, at this point [on The Roku Channel], over 80,000 free and paid movies and TV shows. We've added live linear services like ABC News. There're over 40 live linear services now. Premium subscriptions we added recently, so over 40 million different premium subscriptions that includes HBO and SHOWTIME.Nearly 50 kids & family content partners. '…You will see more and more content coming to The Roku Channel, different categories and you will see it integrated into different points in the UI. And so, that's really our approach in terms of being a one-stop distribution channel." – Anthony Wood, CEO


"We've launched a new streaming player lineup in North America, Latin America, and key markets in Europe. CNET named the Roku Streaming Stick+ as the best overall streamer for a third year in a row. Roku monetized video ad impressions more than doubled again on a year-over-year basis. The Roku Channel contributed to this growth as ad impressions within the channel are growing faster than the ad impressions in the overall platform.

"Finally, we recently announced an agreement to acquire Dataxu, a demand-side advertising platform. While we work with many leading DSPs, and will continue to do so, we believe the Dataxu acquisition will accelerate our OTT advertising roadmap and enable Roku to provide marketers a single data-driven software solution to plan, buy, and optimize their ad spend across TV and OTT.

"I mean, the primary reason that we acquired Dataxu was for the talent and technology to accelerate our technology road map.

"Today, our ads that we sell are mostly sold direct. But we think the ad buying is going to become more automated over time and this acquisition's primary goal is to accelerate our road map for our ad tech." - Anthony Wood, CEO

"Our goal, ultimately, is to present a holistic TV and OTT planning and buying solution for TV advertisers and help support them as they migrate their spending out of traditional linear TV into OTT. Our real goal in this deal is to both expand the business we do with current clients, give them new data and measurement products, prove more efficacy across the broader portion of their media. It also helps us work with a broader spectrum of clients who may want to participate more in OTT than they can today and with value, programmatic, API, self-serve type access to OTT. We are combining the unique advantages of Roku's first-party consumer relationship, our scale, our proprietary data, and inventory together with some great talent, device graph technology, data science capabilities from Dataxu.

"We do anticipate that programmatic, as well as other forms of automation, API-based buying, self-serve will become a growing part of OTT. It is still a minority of total spend." - Scott Rosenberg, General Manager, Platform Business

Answering a question regarding the launch of Disney+ and whether that was a threat to growth:

"Overall, we're excited about the launch of all the new services coming to the industry and to our platform. We think that they are good for Roku in a bunch of ways.

"There are obviously going to drive viewing overall on our platform or engagement, which is good. They're going to increase the interest in viewership, moving from traditional TV to streaming. We think that eventually all TV is going to be streamed and that this will be the rise of all these new services will help encourage that transition.

"We have customers that want to watch both [free and premium content]. And so, we think all those business models are supported on our platform." - Anthony Wood, CEO

"I just like to add to Anthony's comment that we think our biggest competition is attracting linear TV ad spending out of linear into OTT. That is the competition. Today, according to Magna, only 3 percent of TV budgets are spent in OTT but 29 percent of audiences are already there.

That's the big opportunity. That's what we're focused on over the next 12 to 24 months. And there could be lots of winners on our platform, including these new services. - Scott Rosenberg, General Manager, Platform Business

Answering a question regarding the Roku Channel growth:

"It continues to be fifth in terms of region and growing much faster than the platform as a whole. It's also growing as a contributor of ad inventory into our overall sales. We just launched kids & family this quarter, that was a great new addendum to our overall content offering.

"Our goal is The Roku Channel and its ad load has not changed. We still believe' that about half of the linear TV ad load is the right recipe for monetization and consumer experience. In general, we think that's going to be proven to be the case broadly across OTT that ads have got to get smarter and fewer in order to hit that balance right.

"But every provider on the platform has a different mix of program to add time." – Scott Rosenberg, General Manager, Platform Business

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Sirius/XM (Pandora)

Summary: Sirius XM is reaping the benefits of the Pandora acquisition, along with finding strategic new ways to integrate the products together. The earnings call also focuses on steps that Sirius XM has made to integrate, elevate, and monetize podcasting.

Top Quote: "Needless to say, I am quite confident we will attain our full year guidance of approaching one million self-pay net additions." – James Meyer, CEO


"The Pandora acquisition has very quickly increased our scale to approximately 100 million users. We're already using this additional scale to speed up improvements to our digital products, both in car and out of car and to attract and promote new content. As an example, over the summer, we started driving plays of Lewis Capaldi's "Someone You Loved" to our 100 million listeners, igniting the pickup of the song on streaming platforms and, ultimately, radio plays that brought it to number one on billboard last week.

"The Pandora acquisition has broadened our skill set to include an advanced market-leading digital advertising business.

"I'm very excited about the ad tech platform at Pandora and the continued progress we are making there. Our programmatic offering and off-platform performance with SoundCloud are both driving excellent results. Premium access where a user watches a video ad to unlock on-demand listening is performing well, particularly with younger listeners.

"We want our content to be differentiated from and superior to other offerings in the audio market and I think we are making great progress in that area. This will mean more curated branded stations and playlists at Pandora. It means using more megastars and brands with built-in fan bases to drive demand and brand relevance. SiriusXM and Pandora will continue to be different. But some of the ways we have been successful at SiriusXM over the years will be an important part of the strategy to reinvigorate the Pandora business, as well.

"This nicely complements SiriusXM's excellent in-vehicle position. SAAR is humming along on the 16.8 million to 16.9 million range, nearly flat with last year. While penetration was in the low 70s, we still expect to be at 80 percent overall next year. And based upon our latest discussions with OEMs, we may even go a bit higher than 80 percent over the next several years. This will push our enabled fleet from about 123 million today to more than 220 million over the next decade.

"Last week, we announced a collaboration with Marvel to create scripted and unscripted podcasts exclusively for the SiriusXM and Pandora platforms. This pivotal deal neatly illustrates our podcasting approach. We care about quality and we always love to associate with the best brands, first and foremost. People don't just want more, they want what is compelling. Marvel creates fantastic, character-driven storylines and their record of success is unrivaled. We are thrilled to partner with Marvel and to see this exciting content debut next year." – James Meyer, CEO

Responding to aquestion on podcasting:

"To us, the podcasting game, we believe, is all about the value of the quality of the content, and we don't believe that many of the big entertainment brands have really weighed in yet, which is why we think the Marvel announcement is really so extraordinary of where we are going here. Again, here though, I will reassure you that we will go down this path on the content area with fiscal discipline. There're the two other little simple things. We got to make sure subscribers know how to find it when they want it and we got to know how to promote it to them correctly. I don't want to just run out there and say, '"Hey we are in podcast.' I want to deliver the whole thing and then go drive it." - James Meyer, CEO

"Given that most podcasts are put out for free on an RSS feed, Pandora quietly has accumulated approaching 7,000 very good podcasts already. Once Pandora's algorithm is able to align your music pace with your podcast and you can surface podcasts the way they surface music, it's an entire different game because, as the music industry learns, soon enough, the issue is whether you can curate well and surface well when there's a tremendous amount out there. And we think we will be in that game, as well as the quality game." – Scott Greenstein, President and Chief Content Officer

Responding to a question on content costs:

"I just want to reiterate: we are really pleased to have FOX News resigned to a multiyear renewal with us. We were able to do that deal with economics that certainly makes sense to us. But, having that one FOX News is an important part of what the SiriusXM listener base really demands. And having that back in place for several years now ahead of us at a cost that, as David said, we tend to redo these things and then there's a step and then it stays flat we are really pleased with." - James Meyer, CEO

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Summary: A strong quarter with revenue increase of 50 percent YAG. Whatever challenges Snap had with their infamous Kylie Jenner hated re-design are well-behind the company. Per the earnings call, Snapchat reached 90 percent of ages 13-24 and 75 percent of 13-34-years-old.

Snap reiterated its commitment and belief in augmented reality. In the past, this has been costly as their "Spectacles" camera sunglasses have not exactly taken off, but they have moved to a more measured approach, launching Spectacles 3 at a much-limited run and higher price point of $380, and limiting the target to fashionistas and the creative community.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote: "Fast, visual communication is the core product value that Snapchat provides and we are committed to bringing our unique messaging service to people around the world, regardless of their device or quality of connectivity." – Evan Spiegel, CEO and Co-Founder


"Building on the strong momentum we developed over the first half of the year, our community grew to 210 million daily active users, an increase of 13 percent year-over-year. Revenue increased 50 percent year-over-year to $446 million, marking the third consecutive quarter of year-over-year revenue growth acceleration.

"Today, each daily active user opens Snapchat 30 times per day on average.

"The NFL doubled down on live sports this season by breaking out Sunday football highlights into a separate Discover channel that is regularly updated throughout the day on a near-live basis. This has increased both the frequency at which viewers watch by 40 percent and the total time spent watching NFL highlights by 70 percent when compared to last year.

"We have a significant lead in augmented reality due to the camera-first nature of Snapchat and the frequent usage of our camera, and we believe that smartphone-based augmented reality will be an important driver of our business over the coming years. We have been investing heavily in tools like Lens Studio to help creators build augmented reality experiences and evolving the ways that we distribute Lenses to our community through products like Scan and our AR Bar.

"Snapchat now powers billions of daily AR experiences, with each of our daily active users interacting with augmented reality nearly 30 times every day on average. To date, our community has created over 600,000 Lenses in Lens Studio, with top-performing community Lenses reaching billions of views on Snapchat. Looking out over the long term, the next seven to 10 years, we will work toward realizing our vision of computing overlaid on the world through wearable augmented reality.

"We expect to invest significantly in both maps and gaming over the coming years.

"We are building low volumes of Spectacles 3 and using this iteration to test and learn more about wearable computing.

"The combination of our scalable ad platform and sales team reorganization allows us to reach a wide variety of advertisers to help them grow their businesses. We remain extremely under-monetized relative to our audience and engagement and underpenetrated in terms of advertiser budgets." - Evan Spiegel, CEO/Co-Founder

"North America and Europe each delivered DAU growth of 1 million sequentially, and we are pleased to see continued expansion of our audience in these already well-established markets. In the quarter, we generated total revenue of $446 million, an increase of 50 percent year-over-year. Average revenue per user was $2.12 in Q3, an increase of 33 percent year-over-year and 11 percent sequentially.

"We are driving against four key priorities to accelerate growth. First, we will continue to demonstrate the value of our large, unduplicated, and otherwise hard-to-reach audience. Second, we will continue to launch innovative ad products that allow advertisers to reach our audience in an effective and immersive way. Third, we will relentlessly deliver ROI and help our advertisers measure their campaigns in the ways most meaningful to them. Finally, we will better service more advertising partners by improving our sales and marketing functions, expanding our go-to-market operations and activating key partnerships.

"Total impressions were up 121 percent year-over-year, driven primarily by growth in Snap Ads as we continue to see strong demand for down funnel bid optimization products, such as app installs, as well as growing demand for our premium ad units, such as Commercials. Our advertisers are able to achieve higher ROI when they combine Snap Ads with our augmented reality and creative tools products, and this is helping to drive strong adoption of our self-serve Reach & Frequency lens products, which grew more than 30 percent sequentially in Q3.

"In the U.S., we reached 90 percent of 13 to 24-year-olds and 75 percent of 13 to 34-year-olds. So, in the U.S., for example, roughly 80 percent of our daily active users are on our Discover content platform.

"The improvement in user activity, combined with optimizations to our self-serve platform to utilize our inventory more efficiently, are driving continued expansion of our available supply at a rate that is above growth in advertiser demand, which has resulted in the modest decline in yield. As a result, we continue to have ample supply and lots of room to grow ARPU through both improved sell-through rates and higher yields over time. Gross margins were 51 percent in Q3 2019, up 15 percentage points year-over-year and 5 percentage points sequentially as we continue to focus on scaling our operations efficiently.

"And in this past quarter, we doubled down on our video advertising solutions with a robust rollout of new products for video buyers. We extended the maximum length of video ads on our platform, allowing advertisers to leverage videos up to three minutes in length. We added this capability to our unskippable commercials, as well, transitioning to a skippable video after the first six seconds.

"We have developed a product by which advertisers can bid in our auction against the goal of longer form video views. These capabilities together helped Universal Pictures get completed trailer views on Snap up to nine times more efficiently in early testing.

"At this time, we are seeing our Dynamic Ads campaign drive a 66 percent decrease in cost per purchase and a 171 percent increase in return on ad spend compared to similar product-focused campaigns running in the U.S." – Jeremi Gorman, Chief Business Officer

Responding to a question on whether TikTok is friend or foe:

"I think at a high level, looking at TikTok, we definitely consider them a friend. They're a developer partner. With Snap Kit, they're an advertising partner for us. And I think, most importantly, the value they provide to their community is very different than the value we provide to ours to really empower communication with real friends. So, I think overall, as you mentioned, time spent on mobile is growing. We're both growing our businesses in a very rapidly growing industry overall." - Evan Speigel, CEO & Co-Founder

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Summary: Several missteps around usage of data caused Twitter to miss earnings estimates in Q3, although daily active users are up. Twitter warned that revenue headwinds would continue through 2020. A few days after Q3 earnings, Twitter announced that they will not be accepting any political advertising.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote: "We were pleased advertising revenue growth rebounded to double-digits globally in September, with the most pronounced recovery in the United States. Advertiser sentiment remains strong" - Ned Segal - CFO


"Today, we're proud to share that nearly half of the 19 million daily customers we've added since the fourth quarter of 2018 can be attributed to the steady refinement of Twitter. This also fueled our results this quarter of 17 percent year-over-year increase of daily usage to bring us to 145 million mDAU.

"In parallel, we are rethinking the fundamentals of how Twitter works in order to better address the problems we are seeing. One example of this is our work on public conversation health. At the beginning of this year, we resolved to break from only acting on reports of abuse and harassment to proactively identifying tweets and conduct that violates our terms of service.

"Over half of the enforcement actions we take in any given week for violating our abuse rules is now proactively identified and verified by our agents before a victim or bystander has to report the violation." - Jack Dorsey, CEO

"We still have more than half of our video ads being served at longer than 15-seconds. As you'd imagine on a service like Twitter, the completion rates for video ads that are six-seconds are much better, they are much more effective for the advertiser, they're much more compelling for the person watching them that knows that are 15-seconds or longer." - Ned Segal, CFO

"We have evidence that people see Twitter as an interest network and spend a bunch of time focused on finding and following accounts that match their interest. To address this, we went back to a feature that Twitter experts make use of lists. This quarter, we made lists easier to create and, most importantly, to consume. We've added the ability to pin lists directly to your home timeline, enabling a fast switch between your home timeline and the accounts you want to keep on.

"We're also experimenting with following topics right from your timeline. A tweet about the Golden State Warriors, for example, would now have a prompt to follow the topic, which allows us to include all relevant tweets matching the topic, without having to follow the various accounts that produce them."

On tech missteps that shared or used data that was not supposed to be shared or used:

"We asked people a series of questions before we put you into a timeline when you are new to Twitter. Among the questions, we asked: if we can use your device settings to figure out the best ads to show you. It turns out that that setting wasn't working as expected and we were using device settings even if people had asked us not to do so. So, when we discovered that, we tweeted about it, which we often do to be transparent with people when things aren't working as expected. We turned off the setting, so that it would work as expected. That has a negative impact to revenue because it's one less input you've got, when you are figuring out which ads to show people.

"A second example is specific to MAP, where we typically will share data with measurement partners who will then share with advertisers, so that they can see the effectiveness of their campaigns, not just on Twitter, but across platforms. Another one of the questions that we ask people before we put them into a timeline is if we can share their data with measurement partners. That setting also was not working as expected and we were passing on data, which we have not intended to. So, we stopped doing that and although we are working on remediation, there isn't remediation yet in place, and so the effects of that will continue into Q4." - Jack Dorsey, CEO

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Viacom(note: for Viacom this is their fiscal Q4)

Summary: This was the final quarterly report prior to the ViacomCBS merger. This was a strong quarter for Viacom, with major announcements with Netflix and revenue growth across multiple lines of business.

Q3 Stock Trend (Source: Wolfram Alpha)

Top Quote: "Thanks to the combination of our vibrant brands and strong ad sales execution, including our sophisticated suite of Advanced Marketing Solutions, we delivered 6 percent ad growth, marking the second consecutive quarter of positive performance. Perhaps more important, we also delivered full-year revenue growth for the first time in six years. This represents a significant milestone for Viacom and is evidence of our transformation. In particular, the success of our Advanced Marketing Solutions business, where revenue grew 83 percent in the quarter and 76 percent for the full year, shows how we have evolved the ad sales business to thrive even in the face of linear impression constraints." – Bob Bakish, President & CEO


"We returned Paramount to full-year profitability. The studio was profitable for the first time in four years. We did this by improving execution across the board, putting in place a new, balanced film slate strategy, and by significantly ramping the TV business.

"Moving to Domestic Media networks. Viacom maintained the number one share of U.S. basic cable viewing among key demos. And our portfolio grew market share in the quarter and for the full year with strong results at MTV, Comedy Central, and Paramount Network. In fact, in the quarter, we had the number one cable comedy telecast with South Park, the number one drama series with Yellowstone, the number one reality series with Love and Hip-hop: Hollywood, and the number one preschool series with Ryan's Mystery Playdate. And that is just the tip of the iceberg. We had nine of the top 30 cable networks, more than any other cable family. More recently, in Q1 at BET, we launched Tyler Perry's The Oval. in fact, The Oval became the number one new series for African Americans [ages] 18 to 49 for cable and broadcast season to date.

"Looking beyond linear TV, in Q4, Viacom Digital Studios delivered its highest views ever on YouTube, Instagram, and Twitter. In fact, VDS drove year-over-year increases in Viacom's aggregate number of social video views and minutes by 38 percent and 75 percent, respectively, across all of our domestic social accounts, bringing our total social video views to 9.6 billion in the quarter.

"Pluto TV continues to grow, expanding its leadership in the free streaming TV space and its contribution to our ad sales growth. It now has approximately 20 million domestic monthly active users, a nearly 70 percent increase this calendar year to date. In Q4 alone, Pluto launched 43 new channels.

"Pluto Latino added 11 new channels, giving the platform a total of 22 channels with over 4,000 hours of Spanish and Portuguese language programming. We also continue to grow Pluto TV distribution both globally and on new platforms, which benefits both our audiences and our partners.

"In short, in a crowded subscription universe, as consumers become increasingly more value-conscious, we strongly believe that having the leading free streaming TV service in country, and over time, the world, is a huge competitive advantage.

"We believe persistent headwinds from subscriber trends and rates will continue to impact the business, which is why our multifaceted approach is the right strategy going forward. On the media networks studio side, including Nick Studios, Awesomeness, MTV Studios, and more, we have 17 domestic series ordered to or in production for third-parties, which is an impressive achievement for a business we created less than two years ago. Add the 26 we have at Paramount TV, and we have a total of 43 shows in the rapidly growing TV studio business in the U.S. alone.

"We got two new deals with Netflix. Just this week, Nickelodeon Studios announced a new, multiyear output deal to produce original animated films and series based on both Nick library and brand-new IP for kids and families around the world. I'm also pleased to announce that Paramount has licensed the rights to Beverly Hills Cop to Netflix, which will produce a new film based on an iconic IP, further expanding our relationship with this important original production client.

"In October, Comedy Central Productions and Trevor Noah signed an agreement to develop a comedy series for Quibi. And we recently licensed South Park's domestic streaming rights to HBO Max, further demonstrating the appeal of our IP and our ability to maximize its value. We continue to broaden the business internationally, as well. As an example, we now have almost 40 mobile deals live, reaching five million subscribers." – Bob Bakish, President and CEO

"Moving to domestic ad sales. Revenue finished up 1 percent for the year, benefiting from a return to growth in the back half, including a strong Q3 and Q4 with both quarters up 6 percent. AMS (Advanced Marketing Solutions) is enabling us to decouple our ad revenue performance from broader industry declines in linear capacity, setting us apart from our peers and helping us now deliver industry-leading advertising revenue growth. AMS revenue accounted for 17 percent of full-year domestic ad sales and over 20 percent of our fiscal fourth quarter domestic ad sales.

"In fact, in the month of September, Pluto registered its highest-ever revenue month, and total viewing minutes tripled over the prior year. We continue to see Pluto TV as a global opportunity, including over $1 billion of ad sales in the U.S. alone as we expand the content offering, grow audience, and enhance monetization." – Wade Davis, Chief Financial Officer

"And now we're beginning the next leg of our journey, one that is transformational: the merger of Viacom and CBS. At the center of it all is content, ViacomCBS will be a truly global, multi-platform, premium content powerhouse with tremendous assets and scale. ViacomCBS will be positioned to serve consumers, the creative community, commercial partners, employees, and other constituents while creating significant value for shareholders. We anticipate the ViacomCBS merger closing in early December, but we are already hard at work, including having announced the bulk of the senior leadership team of the combined company, which is deep into integration planning as we speak.

"And this integration is not just about cost savings. At its core, it's also about extracting more value from our content assets. To that end, just this week, Pluto TV announced the launch of three new channels from CBS, giving customers free access to live local news streams from CBSN New York, CBSN Los Angeles, as well as a leading entertainment new streaming channel, ET Live. This is just a taste of what's to come once this deal closes in a few weeks."

On ViacomCBS:

"Remember, on a combined basis, ViacomCBS delivers about 22 percent of U.S. primetime TV viewing with a range of highly sought-after content. Today, we only receive about 11 percent share of the fees. We believe that represents a significant going-forward opportunity.

"As you know, we will have a market-leading position in linear across every demographic. We're the number one share player overall. We'll be the number one player on every single demographic. Combine that with the industry's leading Advanced Marketing Solutions platform, that will position us as the go-to solution and problem solver for agencies and their clients, and that, in turn, will allow us to grow share. The third area is content licensing. Here, we're uniting a Hollywood film slate with substantial TV production across multiple entities, whether that's CBS or Showtime or Viacom Media Networks or Paramount TV.

"So, we are in the middle of developing our combined company streaming strategy. As I said, that strategy will cross free, leveraging the tremendous head start we have with Pluto. And Pluto today, the last number I said, Pluto has 50,000 hours of content on it, 250-odd channels. We added many Viacom channels, but it's not just Viacom channels.

"So, that's a way of getting more ROI out of assets we already own. That's certainly the road forward. And vis-a-vis time where it moves from one place to Pluto, that's something we continue to evaluate. But again, using pure Viacom library content with good distance from airdate, that's working very well for us.

"We're tremendously excited about that. So, I'm not surprised that Iger wants to participate in the free space, too. It's a big part of the market. And, by the way, that market is partially people that are only using free and is partially people that are using free as a complement." – Bob Bakish, President & CEO

On the approach to the advertising community:

"On the ad side, as you said, we have a tremendous opportunity here. If you look at what Viacom did in the last Upfront, where we combined the Viacom portfolio of networks with Advanced Marketing Solutions, including Viacom Video and Pluto, doing things like taking our 18 to 34 reach from low 40s with our linear networks, high 40s with Pluto, 90 with Viacom Video, bringing that to market in a package to help get advertisers more reach without frequency cap problems and help them manage inflation, that was compelling. Every agency in the industry signed up for it. And, as you know, we had a very strong Upfront. ViacomCBS is that on steroids. We will be the definitive problem-solver for the industry and the first port of call almost without a doubt.

"But you see demand ramping from streamers. Whether that's in the television series space or that's in the film-length space, that's a good growth segment. In some respects, that is the new home video. We have a longer-term opportunity probably in the PVOD space." – Bob Bakish, President and CEO

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