Insights & Analysis: Publicly Traded Companies in Q3 2022

Every quarter, business analyst Matthew Scott Goldstein details and shares his insights on what he saw happen with publicly traded companies across advertising, technology, and media.

Top-Level Insights for Publicly Traded Companies Q3 (2022)

Macro Environment: What We Saw in Q3

• Challenging inflationary and uncertain macroeconomic environment 
• The Fed raised its fed funds rate 75 basis points again and indicated another increase of the same magnitude is likely in November, a hawkish signal following the stronger-than-expected inflation report for August. 
• On the other hand, the unemployment rate is pretty healthy, and even if consumers are spending less than they did at the height of the pandemic, they’re still spending.
• Crypto prices, NFT’S and the stock market are down, again and SPACS are out of favor 
• Global recession may occur, we may already be in one  
• 2023 may be very hard across the board making budgeting very complicated for many companies 
• Hiring slowing down across big tech, may be a great opportunity for the next generation of tech start-ups 

Digital Media: What We Saw in Q3

• Amazon and Apple dominated the news cycle once again with Amazon making a big move into healthcare and Apple the new iphone and ads 
• Apple is clearly in the digital ads business, we will soon have a “QUAD”opoly with Apple joining Google, Facebook, and Amazon
• All big tech is still worried about TikTok with their unbelievable strong hold on time spent 
• Twitter may be dead long term as an ad supported business 
• Facebook is in terminal decline 
• Cookies are already dead giving the rise of Apple products in the US; most estimates say that Apple is 40-60% of the impression volume in the US, and growing  
• Publishers are really trying to diversify revenue away from just ad sales and it is not that easy many are trying to move into e-commerce, but with limited success 
• Influencers continue to gain power 
• Ad tech had a tough quarters with very little happening, besides TTD UID 2.0 and Open Path   
• Membership is the best recurring revenue stream out there — Netflix, Amazon Prime, Costco, NY Times, Spotify, etc.  
• Web3 still movin along, even with Crypto and NFTs down though Chief metaverse officer roles are popping up at companies 
• Streaming now all about the ad-supported model, with American Football driving the business 
• I still think Netflix will do something unique in OTT advertising in 2023/24, beyond traditional :30 seconds ads with no real frequency  
• As a big fan of Pickleball, I love that Lebron and associates are getting involved and could Eli Manning’s Chad Powers become the next Ted Lasso????

Deeper Insights for Publicly Traded Companies Q3 (2022)

Digital Media Publishing: What We Saw in Q3 2022

• Trust in media is lower in the United States than any other place in the world, according to the Reuters Institute Digital News Report 2022. Finland has the highest level of trust at 69%, while the U.S. has fallen three percentage points to 26. 
• People are less interested in news in general. In the U.S., 47% say they are interested, which is down from 67% in 2015. 
• Americans’ confidence in newspapers and television news has plummeted to an all-time low, according to the latest annual Gallup survey of trust in U.S. institutions.
• The consultancy Stillwell Partners LLC has sold Advertising Week, a company that runs trade shows and educational services for marketing, media and technology professionals, to Emerald Holding Inc., an operator of business-to-business events.
• IAC/InterActiveCorp said on 7.13.22 that June digital revenue at its media arm Dotdash Meredith was impacted by softening advertiser demand, as well as site migrations delays and salesforce integration
• People and Better Homes places big bet on product reviews — Dotdash Meredith looks to leverage the magazine brands it bought to boost affiliate revenue
• Wordle is being turned into a board game
• In an increasingly crowded field, US-based news website Vox has become arguably the most successful English language news publisher on Youtube.
• Meta has begun telling news partners that it no longer plans to pay publishers for their content to run on Facebook.
• Forbes is exploring a sale of its business after a previous deal to go public fell through. An offering document describing Forbes’s financials compiled by Citigroup has been circulated to media companies, including Yahoo. According to the document, Forbes generated more than $200 million in revenue and more than $40 million in profit in 2020. 
• The New York Times plans to more aggressively sell bundles of its subscription products to drive revenue and offset pressure from advertisers who are cutting spending in a weakening economy.
• Cox Enterprises has acquired online publisher Axios Media for $525 million. This follows a prior investment by Cox in Axios last fall. Cox says it is committed to “scaling and expanding” Axios into more cities. 
• In a bid to parlay its influence over young female readers into tourism budgets and a new source of reader revenue, Hearst title Cosmopolitan announced the launch of its new travel booking service CosmoTrips—its latest and most ambitious foray into the sector.
• USA Today has teamed with The Weather Channel and Tripadvisor to offer premium subscription bundles. Consumers can pair The Weather Channel Premium Pro digital subscription with Tripadvisor Plus or with USA Today’s Digital All-Access plan. 
• The news industry is backing proposed legislation that would force Big Tech to pay for using publishers’ news stories online. 
• CafeMedia has acquired Slickstream, Slickstream for Bloggers helps publishers build traffic with intelligent site search, data-driven content recommendations. It also provides a favoriting feature that lets readers save content, and a highlighting tool that works with email service providers to drive subscriptions. 
• Time is acquiring Brandcast, a company that licenses software for easy-to-build marketing websites, and forming a new division. 
• Washington Post is on track to lose money in 2022, after years of profitability. The Post now has fewer than the three million paying digital subscribers it had hailed internally near the end of 2020, according to several people at the organization. Digital ad revenue generated by The Post fell to roughly $70 million during the first half of the year, about 15 percent lower than in the first half of 2021.
• BDG and Vice Media teased going public via a special-purpose acquisition company last year, but both companies ended those talks. 
• The news and culture publisher Vox Media is on pace to host more than 100 events this year– an 18% increase from 2021 — and a key indicator of the growing emphasis it plans to place on its slate of experiential offerings.
• After six months of planning, The New York Times has finally brought ads to The Athletic.
• NYT Cooking, the subscription recipe site from The New York Times, will sell $95 at-home cooking kits curated by guest chefs as a new means to grow revenue and boost readership for the service. 
• Recurrent Ventures has acquired Dwell, a publication on contemporary home design for The terms were not disclosed. 
• Online commerce shops aren’t turning out to be the golden ticket to revenue diversification that some publishers were expecting. But the media companies that are still operating storefronts on their owned-and-operated sites are not trying to compete with the Amazon model of having everything for every reader.  
• Bustle Digital Group shut down the tech publication Input and cut staff at music and entertainment site Mic. 
• The Atlantic is pushing aggressively into film and TV projects as part of a wider licensing revenue push. The company, which expects to lose roughly $10 million again this year, needs to build another revenue stream to continue on its path to profitability.

Big Tech: What We Saw in Q3 2022

• TikTok has ditched plans to roll out its live e-commerce efforts to major Western markets after the Chinese video app struggled to gain traction with its TikTok Shop product in the UK
• Not likely to end up with SuperApps in the US like we have seen in Europe because the market is too competitive here
• Elon Musk’s attempt to terminate his $44B takeover of Twitter has set the stage for what could become one of the most unusual courtroom battles in corporate-takeover history. 
• Spotify said it will acquire Heardle, a daily music trivia game that tasks players with identifying a song based on its opening notes.
• Elon Musk may never buy Twitter, but the billionaire’s bid for the company has left lasting damage to Twitter’s ad sales department. Twitter ad sales and agency representatives have been leaving the company in recent months because of the turmoil created by the billionaire’s acquisition offer, which is now in disarray.
• Google said it would slow its pace of hiring for the rest of the year, joining other major tech companies in deciding to slow or freeze hiring ahead of an expected recession. “The uncertain global tech outlook has been top of mind,” Sundar Pichai, Google’s CEO, wrote in an email to employees
• Kids and teens spend an average of 91 minutes a day on TikTok, more than they spend on YouTube, one company’s data shows
• Ac­tivist in­vestor El­liott Man­age­ment Corp. has taken a big stake in Pin­ter­est Inc., ac­cord­ing to peo­ple fa­mil­iar with the mat­ter, as the once-hot so­cial-me­dia com­pany grap­ples with a de­cline in users and other chal­lenges.
• Facebook is putting its News tab and the newsletter platform Bulletin on the back burner. It will focus instead on short-form content creators who can help compete with TikTok
• Instagram is rolling back some of the moves it had been testing to more resemble TikTok. 
• Meta announced major changes to the Facebook app that will transform its experience into a more TikTok-like selection of algorithmically chosen videos — and shunt off content posted by family, friends and groups into a separate side feed.
• Amazon and One Medical announced that they have entered into a definitive merger agreement under which Amazon will acquire One Medical. 
• Organic success on TikTok is encouraging more DTC brands to buy ads on the app
• Apple introduced new ad slots in its App Store, including one on the homepage. 
• Meta has agreed to postpone its acquisition of Within Unlimited, developer of VR fitness app Supernatural, after the Federal Trade Commission sued to block the deal
• Apple may have blown up the digital ads business but it left enough fertile ground to build its own, more focused play for media dollars. The company is building a demand-side platform if recent job listings are to be believed. Specifically, it is looking for a senior manager for a DSP in its ads platforms business. Whoever gets the job will be asked to “drive the design of the most privacy-forward, sophisticated demand side platform possible,” per the post. Moreover, the ideal candidate would have experience building a mobile-centric DSP and know-how when it comes to optimizing “mobile campaigns using measurement and attribution
• Apple could integrate ads into Maps as early as next year. The engineering team has already begun preparing the software to support search ads
• Walt Disney is exploring a membership program that could offer discounts or special perks to encourage customers to spend more on its streaming services, theme parks, resorts and merchandise
• Apple’s latest line-up of iPhones will have the same prices as the 2021 models, despite this year’s inflationary pressures.
• Google lost its appeal against a $4.125B (€4.125B) antitrust fine by a top European court after the regulators found major violations in how the tech giant operated its Android mobile operating system by restricting rivals four years ago. The court confirmed its decision in a ruling issued this week. The ruling has global repercussions, potentially spurring enforcement from other regulators on similar cases.
• TikTok and the Biden administration reached a preliminary deal to address national-security concerns over the Chinese-owned social media platform, but talks are not finished. 
• Google is shutting down its cloud-based videogame service Stadia, introduced in 2019 as an alternative to consoles like the PlayStation or the Xbox
• Both Amazon and Facebook parent company Meta are cutting back on their plans for major office expansions in New York City. 
• Apple set a new return-to-the-office deadline of Sept. 5, by which point it wants corporate employees back in at least three days a week. It’s the latest effort to mandate a return after earlier plans were repeatedly delayed. 

Streaming Services & Platforms: What We Saw in Q3 2022

• NBCUniversal said its Peacock streaming service generated $1 billion in ad commitments during the upfronts. 
• Peter Chernin, the veteran media executive turned investor, announced that he’s created a new global content studio called The North Road Company with $800 million in outside funding — North Road aims to be one of the largest, independent global production companies
• Amazon buys streaming rights to Champions League games in the UK
• A new report from JustWatch notes that Netflix remained the leader with 21% of the streaming market in Q2 but saw its share modestly declining from 23% in Q1. Amazon Prime Video remained No. 2, gaining +1% q/q to close out Q2 with 20% market share. HBO Max (3rd) and Disney+ (4th) picked up one percentage point apiece during the past quarter, as HBO Max reached 15% share, while Disney+ reached 14% share. Hulu was 5th and stayed steady at 10%, whereas sixth-place Apple TV+ gained one percentage point, raising its market share to 6%; Paramount+ ended Q2 in seventh place with 4% of the market
• Netflix’s ad-supported subscription tier is unlikely to be a hit, according to a new survey from Whip Media. 72% of respondents said they were “unlikely” or “very unlikely” to switch to an ad-supported offering from Netflix
• YouTube TV has surpassed five million subscribers (including free trials). “Five years ago we launched YouTube TV to rethink how we watch live TV, give users more choice, and unlock a new revenue stream for our partners
• Netflix reportedly wants to renegotiate its programming deals to show ads during programs. 
• Netflix selected Microsoft its technology and sales partner as the streaming giant prepares to offer a low-cost, advertising-supported streaming plan/ In some highly anticipated streaming advertising news, Netflix says Microsoft will be its global advertising-technology and sales partner for its forthcoming low-priced, ad-supported streaming option
• Disney will raise the price of ESPN+ to $9.99 per month from $6.99 per month starting Aug. 23. This is the largest ESPN+ price increase to date. Disney raised the price by $1 per month, first in 2020 and then in July 2021. 
• Disney isn’t changing the price of its Disney bundle, which consists of Disney+, Hulu and ESPN+, keeping it at $13.99 per month.
• Amazon will roll out a new Prime Video experience, designed to be “less busy and overwhelming.”
• The National Football League debuted its new subscription streaming video service, NFL+, for $4.99 a month or $39.99 annually.
• Big tech is making a big play for live sports, competing for rights to broadcast games from the N.F.L. and other leagues could be hard for broadcast and cable companies that “aren’t playing by the same financial rules.”
• Warner Bros. Discovery gave more details about its plan to combine streaming services HBO Max and Discovery+ into one offering, as the company seeks a more disciplined strategy to succeed in the streaming wars amid wild speculation about its future. A merged version of the two streamers will begin to roll out in the U.S. next summer and expand to other countries during the next couple years. The company did not say what the new service would be called.
• Walmart has agreed to a deal with Paramount Global to offer the entertainment company’s Paramount+ streaming service to subscribers of Walmart’s membership program. Walmart has been exploring a subscription video-streaming deal to draw more people to Walmart+ as it seeks to challenge Amazon.com Inc., which has grown its own Prime membership program to about 200 million global members.
• Netflix Inc. isn’t planning to let users of its new ad-supported tier download shows and movies to their devices for offline viewing, according to code found inside of the company’s iPhone app, removing a feature that customers enjoy on its regular service. 
• Amazon has developed new technology and broadcast features it hopes will delight fans of “Thursday Night Football.”
• Netflix eyes $7-to-$9 price for its new ads Supported plan, Service targets about four minutes per hour of ads at first and Streaming giant won’t put the commercials on after its shows
• Netflix is reportedly asking for much higher advertising rates for its forthcoming ad-supported offering than other streaming platforms.
• Disney’s C.E.O., Bob Chapek, hinted that he may eventually consolidate the company’s streaming platforms into Disney+.  
• Netflix expects its ad-supported offering to reach 40M unique viewers by Q3:23, with the US accounting for a third of that
• Disney is promising media buyers that its ad-supported Disney+ will include frequency caps on ads to avoid the repetition that has plagued other streaming services. 
• YouTube changes to its YouTube Partner Program, allowing creators to earn ad revenue on Shorts, its TikTok competitor. Now, Shorts creators can qualify for the Partner Program, which allows creators to earn ad revenue from YouTube. The existing Partner Program requires YouTubers to have over 1,000 subscribers and 4,000 watch hours in the last year. 
• About 13 million people watched the first “Thursday Night Football” regular-season game to be available primarily on Amazon Prime. But perhaps more important for Amazon, the company saw more U.S. sign-ups for Prime during the three-hour broadcast than in any other such period in its history, including Prime Day, Cyber Monday and Black Friday. Here’s something different: Amazon is not selling beer ads during “Thursday Night Football.” 

E-Commerce Companies: What We Saw in Q3 2022

• Amazon’s deal with Grubhub gives Prime members a new perk — U.S. Prime members are gaining a new perk while Grubhub is obtaining a competitive advantage against DoorDash and Uber Eats. 
• Walmart to add fuel, transportation surcharges for some suppliers — Walmart will reportedly be sharing the cost of supply chain inflation with some of its partners. 
• Amazon has stepped up plans to crack the QVC-style livestream shopping market as the e-commerce giant aims to replicate the success of social media rivals in an attempt to revive flagging online sales.
• Ama­zon.­com Inc. has started dras­ti­cally re­duc­ing the num­ber of items it sells un­der its own brands, and the com­pany has dis­cussed the pos­si­bil­ity of ex­it­ing the pri­vate-la­bel busi­ness en­tirely to al­le­vi­ate reg­u­la­tory pres­sure
• Amazon hosted Prime Day this week from July 12-13, and amid fears surrounding the impact of inflation on consumers’ wallets, the company posted the “biggest Prime Day” in its history. Headlining Amazon’s results was the sheer volume of sales on its platform, as shoppers bought more than 300M items worldwide during the 48-hour event, representing around a +20% y/y uptick and more than 100,000 items purchased every minute. 

web3 & Crypto Markets: What We Saw in Q3 2022

• Meta to pull the plug on its Novi Digital Wallet September 1 — Facebook introduced plans for virtual coin Libra, digital wallet Calibra in June 2019. 
• Starbucks wants its rewards members to earn, buy and sell NFTs that can be used for benefits and experiences such as access to merchandise or a virtual class about making espresso martinis
• IHeartMedia is opening a virtual concert stadium inside Roblox that is sponsored by State Farm, following a similar venture in Fortnite. 
• For the second time since the global pandemic, New York Fashion Week has dawned upon the city, bringing a flock of cascading black fabric, billowing sleeves, and sky-high stilettos to the streets of Lower Manhattan. Models drape themselves around town, Perrier water flows, and the glitterati party like it’s 2019; yet, vestiges of the pandemic hide in the crevices. After two years in a digital void, something in the culture has shifted—and this time, NFTs, the techno-pandemic darling, are taking center stage. Multiple runway shows pay homage to Web3, and like most fashion statements, it’s the opposite of subtle.
• Alongside the sell-off in crypto (down –68% from $3T last November to $957Bin July, activity in NFTs has followed suit as NFT sales reached a 12-month low in June, as per crypto research firm Chainalysis. However, some other research showed that “blue-chip” NFT collections have held up well 
• Since January, the market for non-fungible tokens (NFTs) has been locked in a downward spiral, with sales on one popular platform falling to less than one-seventh of their January peak, and the buyer of the so-called “Mona Lisa of the digital world” – a $2.9m NFT of Jack Dorsey’s first tweet – being forced to sell for just $6,800. 
• NFT projects have turned to a new kind of role: the vibes manager. Also known at some companies as a “chief vibes officer” or “director of vibes”, the vibes manager is something of a cross between a marketer, influencer and investor relations officer, tasked with promoting NFT projects to newcomers while reassuring existing funders. The goal? To keep things positive, no matter what.
• Reddit is set to offer blockchain-backed collectible avatars via a new storefront. Collectible Avatars are limited-edition avatars made by independent artists, in partnership with Reddit, and provide owners with “unique benefits on the Reddit platform
• GameStop announced that it has launched its own NFT marketplace to allow gamers, creators, collectors and other community members to buy, sell and trade NFTs. The Company’s NFT marketplace is a non-custodial, Ethereum Layer 2-based marketplace that enables parties to truly own their digital assets, allowing parties to connect to their own digital asset wallets such as the recently launched GameStop Wallet.
• Celsius Network, the embattled crypto lending firm that has frozen customers withdrawals and transfers for over a month due to liquidity issues, has filed for Chapter 11 bankruptcy protection/ A new filing from Celsius details that the lender owes its users $4.7 billion, part of a larger balance of $5.5 billion in liabilities. When weighed against its $4.3B in assets, the balance sheet is left with a $1.2B deficit in total. 
• NFTs are a controversial piece of the crypto conversation, evoking both passionate criticism and praise as Web3 becomes a bigger part of popular culture. Keith Grossman, president of Time, has spent the past year building the 99-year-old media brand’s NFT business, TIMEPieces, and the publisher now accepts 33 cryptocurrencies for digital subscriptions. Since September, the media giant has created, or “dropped” as it’s known in the space, more than 20,000 TIMEPieces NFTs, generating a $10 million profit and $600,000 for charities.
• Time magazine is assisting the city of Miami in a plan to offer 5,000 Ethereum NFTs designed by 56 local artists later this year.  Time is guiding the strategy, developing the creative and launching the initiative, according to an announcement from the city
• iHeartMedia to host metaverse concerts In ‘Fortnite’ virtual world 
• Chief metaverse officer roles are popping up at companies including P&G, Disney and LVMH. 
• A+E Networks announced today the launch of The History Channel NFT Marketplace, a curation of digital collectibles to celebrate historic events, figures and holidays as well as key programming from the network.

Insights provided by Matthew Scott Goldstein, from his Quarterly newsletter “What I Saw Happen“