Monetizing Media is back! Welcome to version 2.0. Here's the new plan :
It's weekly. Responding to the daily news cycle last year was a reactive way to work, distracting from the projects I wanted to proactively dive do. My productivity has soared since unplugging from it. Rather than share everything, I'm gonna share what's most interesting each week.
It's deeper. My focus is sharing deeper analysis by myself and others, and I'll give attention to a specific topic for multiple weeks at a time. I'll still highlight interesting deals and product updates but expect fewer news summaries.
It aligns with my writing at TechCrunch. I'm using my platform as their Media Columnist to produce:
- in-depth research reports on growth-stage and pre-IPO startups
- long-form analysis on business/technology trends
...in both cases related to media & entertainment.
Much of my writing is behind the new TechCrunch paywall. They've kept it low at $15/month (or $150/year) though and you can use my discount code "PECKHAM" to get $50 off the annual price. The benefit of TC's premium tier = a solid budget to do whatever I need for these research projects.
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- Patreon has undergone a strategy shift from being a marketplace / social platform to a SaaS company making business tools for creators. The goal seems to be to provide all tools & services a creator needs, including small business loans.
- Patreon's rake is too low, but they're about to roll out new premium features. I suggest pricing tiers as a path forward, which is the norm for B2B SaaS.
- The product needs to put creators' brands first and Patreon's second.
- 70% of revenue comes from creators who make $1k+ per month. That'll be $35M+ this year.
- The key question is how big this market size is. The % of creators who make even $1k per month is tiny...but is that 10s of thousands or 100s of thousands of them?
- Last valued at $450M in 2017, I expect Patreon to close a Series D in the next few months that makes it a "unicorn".
- An IPO in a few years is possible, but I think it will get acquired first. Facebook and YouTube are obvious candidates. I make the argument that Endeavor should buy them though.
The summary page is a good place to start. And you can use that "PECKHAM" discount code when you hit the paywall.
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My next report is on Unity Technologies
I had 9 hours of interviews with the exec team at Unity last week as I start my next report. Unity's game engine is now used to build the majority of the world's games. It's rapidly expanding its product offerings though, plus bringing its game engine to new verticals like film & TV, automotive, and architecture. Last valued at $3 billion, Unity is rumored to be targeting an early 2020 IPO.
If you use Unity, I'd love to hear from you.
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Luminary unveiled its initial shows + new $$$
NYC- and Chicago-based podcast startup Luminary Media (which NEA principal Matt Sacks founded last year) announced an initial slate of exclusive podcasts from talent like Conan O'Brien, Trevor Noah, Malcolm Gladwell, Lena Dunham, and Guy Raz. ( Read more)
Aiming to be the Netflix of podcasts, Luminary revealed a $40M first round of funding last year and now says it has raised about $100M total. Its app hasn't launched or announced pricing yet.
I discussed the company in my October analysis that podcasting is going the way of SVOD services. The big music streaming services have a major advantage here given they already have millions of subscribers to premium tiers. This is also a capital intensive game of paying for the best talent and IP, which favors established companies.
Luminary has deep access to capital compared to most startups though and is accessing A-list talent. Keep an eye on it as the likely main competitor to the music services here.
(Btw, this was an interesting argument from a year ago that Twitter should get into the game.)
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Smart Reads
I've a number of articles/reports to catch up on here. More next week. Send me insightful reads you come across.
- PodNews compiled an interesting list of mobile data rates by country and the % of avg annual income they represent. (Read it here)
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Startup to Know: BallerTV
(New section: I'll feature an interesting startup each week)
BallerTV is an OTT platform for watching amateur sports games across the US. With a $15/month ($90/yr) subscription, relatives and friends of young athletes can watch them play in tournaments and games. BallerTV already streams tens of thousands of games per weekend and uses gig workers (amateur videographers) to shoot each game for a low cost.
Founders Aaron Hawkey and Robert Angarita have been business partners for 20 years, previously selling two edtech startups. The team of 30 is based in Pasadena. They pivoted to this business after initially developing a “Periscope for amateur sports” concept with parents shooting video.
BallerTV hasn’t announced its funding details yet but says it has raised a Series A led by Index Ventures and did a Seed round with firms like Peak Ventures, The Chernin Group, Moving Capital, and Unusual VC.
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Also of note...
(interesting deals/announcements over the last week)
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VIDEO/TV/FILM
- AMC Theatre's cinema subscription service, Stubs A-List, surpassed 700,000 subscribers. It launched last June and includes tickets for 3 movies per week for $19.95-23.95/month (depending on the state). (Read more)
- AT&T's WarnerMedia is undergoing a leadership reshuffle as it merges content from each of the brands into a unified OTT offering. HBO president Richard Plepler and Turner Broadcasting president David Levy are leaving. (Read more)
- Discovery's Q4 earnings here.
- Higher Ground Productions, the new production shingle of Barack and Michelle Obama, will be led by Priya Swaminathan (from Annapurna) and Tonia Davis (from Chernin Entertainment). (Read more)
- KKR is making a play in German media. It has acquired film distributor Universum just a few days after acquiring TV company Tele Munchen Group. (Read more)
- Legendary shut down its $4.99/month Alpha streaming service focused on sci-fi, gaming, and fantasy. (Read more)
- Netflix: A survey found 59% of people who use a Netflix account someone else pays for say they would pay for their own subscription if they lost access. (Read more)
- Participant Media's 17 Oscar nominations marked a comeback. (Read more)
- VICE hired Joe Simon as CTO. (Read more)
- YouTube eliminated the comments section from videos focused on minors. (Read more)
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AUDIO/MUSIC
- IFPI says Drake was the world's best selling recording artist of 2018, followed by BTS, Ed Sheeran, and Post Malone. (Read more)
- Liberty Media posted Q4 earnings here.
- Liberty Media, KKR, and Tencent are all interested in acquiring the up-to-50% stake in Universal Music Group that Vivendi is selling. (Read more)
- JPMorgan Cazenove analyst Dave Kerven valued UMG at $50B this week, compared to valuations of $29-42B by Morgan Stanley and $33B by Deutsche Bank in January. (Read more)
- Liberty Media CEO Greg Maffei said his particularly interested in negotiating for a controlling stake in UMG. (Read more)
- See Vivendi and UMG's 2018 financials here.
- Live Nation posted Q4 earnings. The company's annual revenue was up 11% in 2018 to $10.3B and worldwide concert attendance was up 8% to 93M. (Read more)
- Spotify launched in India without music by Warner Music recording artists. Warner had sued to stop the launch. Spotify is streaming music with publishing rights owned by Warner/Chappell, however, which could leave it liable for another lawsuit. (Read more)
- Spotify hired Liz Gateley (former Head of Programming @ Lifetime) to oversee original podcast programming. (Read more)
- Spotify posted a job listing for someone to lead expansion into sports audio. (Read more)
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GAMING
- Ascendant Studios launched as a new SF-based gaming studio (focused on triple-A games) led by former "Call of Duty" creative director Bret Robbins. (Read more)
- Epic Games' Fortnite revenue was down 48% in January from December. The game's revenue normally spikes at the beginning of new seasons (like in Dec) then drops off, however. (Read more)
- Fortnite season 8 preview here.
- G2 Esports, a Berlin-based esports club, raised $17M in Series A funding. (Read more)
- FYI: co-founder Jens Hilgers also founded ESL and the VC firm Bitkraft Esports Ventures.
- NXC Corp, the South Korean hold co of PC and mobile gaming company Nexon, is rumored to have acquisition interest from Amazon, Comcast, EA, Kakao, MBK Partners. (Read more)
- Super League Gaming, which became the first US esports company to IPO last Monday (on Nasdaq) closed the week down 18% with a market cap of $75 million. (Read more)
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PUBLISHING
- Future Plc acquired US publisher Mobile Nations for $60M + up to $60M more tied to performance. (Read more)
- Medium eliminated its $5/month paywall on premium tier articles for users who come to the site via Twitter. (Read more)
- Reddit is testing tipping functionality for fans to support a creator, similar to tipping on Twitch, YouTube, or Facebook. (Read more)
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AR/VR + OTHER TECH
- Facebook may test functionality for Instagram to compete with Pinterest. (Read more)
- Facebook's Oculus CTO implied the cameras on the upcoming Oculus Rift S could support finger-tracking, although that technology isn't ready yet. (Read more)
- The Game Developers Conference (GDC) later this month could feature several important new product announcements in VR. (Read more)
- Microsoft launched the Hololens 2 AR headset. (Read more)
- Epic Games said its Unreal game engine will support development on the Hololens 2. (Read more)
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