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Detroit had a good win against Calgary, and I woke up still feeling good about it. Then, I remembered I was waiting for notes from the Disney call. It wasn’t milk on my cheerios this morning.

As far as I can tell, most of you don’t really dig deep into Disney, Star Wars or Marvel. I’ll try to spare you those bits. Here’s the big take away. After a 3rd quarter loss of 3.5 billion in streaming revenue, the 4th quarter showed (so far) a 1.1 billion dollar loss and 2.4 million people cancelled their service (many in India). If you have Verizon, you know that they gave away IPhone 14 and Disney plus subs for the past 3 months. That wasn’t enough to stave the issue.

Disney did 3 major things (so far). 7,000 job cuts, 8 billion dollar budget cut, and chopped the company into 3 sections. Theme parks (no guesswork there), Disney Entertainment (includes streaming and movies) and ESPN. They own at least 4 other streaming companies and only ESPN was singled out. The board wants to know exactly how much ESPN is making or losing and have separated them from everything else.

Most of you have had to deal with ESPN in order to watch games. You’ve also watched Bally. Bally is “signaling” trouble but not announcing cuts yet. ESPN just got a bad mouthful. They were losing viewers before Disney stepped in and helped create ESPN+. Now it looks like the numbers aren’t holding up. TNT and USA are both dealing with people cancelling cable/satellite service. If you don’t know, channels are paid on a Per Subscription Fee based on a pre negotiated price per subscriber (for interest sake, TNT could have $1 per sub fee).

By the time the playoffs start, Bally and ESPN will release their first quarter earnings (or losses) for 2023. And, as much as many can’t say a lot of positive about Bettman, he is always looking for money. If average views stay in the 300k range, ad revenue will go down. The likely scenario is to try and get a multi year deal with cash up front while the league continues to try and adjust to the current economy. streaming services and social media accounted for up to 200k job losses in 2022. We’ll see if the water has settled soon enough.

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