🍋 Big Tech Goes Sports

Author

Short Squeez
August 22, 2022

Together With

 "Like ketchup and steak, politics and investing should be kept far away from one another." — Michael Batnick

Good Morning! Hope you had a good weekend. Times are a changin'. Summer blockbusters don't seem to be a thing anymore, as movie theaters are struggling after a slow summer from Hollywood. Starbucks' heyday in Russia may be over, as the company exited the country after the invasion earlier this year; you might not be able to tell though, as "Stars Coffee" opened in Russia, with a nearly identical logo. Finally, Penn Entertainment will buy the remaining shares of Barstool Sports that it doesn't already own by February 2023. 

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1. Story of the Day: Big Tech Goes Sports

Sports viewing has been run by the classic mega media companies for forever, but as with everything, tech disruptors are hoping to change that. These tech titans are paying up big for the streaming rights to live sports games.

Disney, Comcast, Paramount, and Fox will pay a combined total of $24.2 billion for rights just in 2024. Apple is now in on the action too, getting deals for the MLB and MLS which could add up to over $3 billion. Not to be left out, because my Alexa is probably listening to me write this, Amazon is building a dynasty.

They recently purchased a minority stake in New York RSN YES Network, as part of a $3.47 billion deal, to get regional access to the Yankees. On top of that, they've got the rights to Thursday Night Football in the NFL.

Even internationally, they've got regional rights for the Premier League, Ligue 1 and 2 in France, and UEFA Champions League in Italy and Germany. Paramount was able to hang on to US media rights for Champions League soccer in a deal valued at over $1.5 billion. To highlight how valuable these rights are, as soccer is not as big in the US, in November, NBC agreed to pay over $2.5 billion over six years to renew US rights to EPL matches.

The battle is also heating up for NFL Sunday ticket between Apple and Amazon, with Apple looking like a heavy favorite. Back in the day, traditional media companies were on top because of their ability to turn big viewership into ad sales. Apple and Amazon are looking at it through more of a lens of more perks to attract subscribers with, that will turn into more high margin business on other parts of the platform.

Short Squeez Takeaway: Every week, I feel like we're getting closer to living in a world like the one in that movie WALL-E. One company is just going to take over all aspects of our lives, and if you aren't a customer, you won't be able to do anything.

2. Markets Rundown

Stocks were lower after some mixed economic and earnings data to close out the week.

Movers & Shakers

  • (+) Foot Locker ($FL) +20% after former Ulta Beauty head, Mary Dillon, became its CEO.

  • (+) Bill.com ($BILL) +17% thanks to better than expected earnings in the last quarter.

  • (–) Bed Bath & Beyond ($BBBY) -41% after Game Stop legend Ryan Cohen dumped his stake in the company.

Private Dealmaking

  • Aero Technologies, a semi-private air travel company founded by former Uber employees, raised $65 million

  • CoinFund, a Brooklyn-based crypto investment firm, raised $300 million

  • Constructive Bio, a U.K.-based biotech startup, raised $15 million 

  • Flossy, a dental care company, raised $14.7 million 

  • Defendify, a cybersecurity platform for small businesses, raised $3.4 million

  • Motivo Health, a mental healthcare platform, raised $14 million

3. Top Reads

  • Some signs inflation is calming down (Axios)

  • Powell’s Jackson Hole speech comes with Fed and the market on different pages (CNBC)

  • Baby pampering is on the rise (Axios)

  • Blackrock warns Wall Street watch dog new ESG rule could harm investors (Reuters) 

  • Why the rental housing market is deeply broken (Axios)

  • The market shrugged at Biden's tax on buybacks. Will it regret that? (CNBC)

  • Recession fears set to split stocks and bonds after summer rally (YF)

  • TV money is breaking college football (Axios)

  • How single-stock ETFs have created new ways to bet on Tesla (CNBC)

  • U.S. at effective ‘peak employment’ bringing hot wage growth into focus (YF)

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4. Book of the Day: The Science of Rapid Skill Acquisition

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“When a significant life shift is forced upon you, accept it as much as you can. If it forces you to learn a new life skill, welcome the opportunity. Don’t fight or resist the chance, and accept the situation you’re currently in. It could be a major force in helping you adapt to your new circumstances."

5. Short Squeez Picks

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6. Daily Visual: Annual Ad Revenues for Tech Companies

2021 numbers

Source: Axios

7. Daily Acumen: Jamie Dimon Advice

At a recent event, the CEO of JP Morgan Chase, Jaime Dimon, offered three ideas worth thinking about.

1. "A lot of people are inefficient with E-mail, phone calls, reading. They are always hurried. They should be thoughtful about their calendar. They need to take care of themselves."

2. "Don't get into this binary thing where you're looking at Fox or CNN. Read the other side. Some of your fellow citizens have good reasons to believe something different than you do. I try to think sometimes about where are they right? Not are they wrong. You'll become a better thinker. And you earn peoples' respect. By telling the truth, being a team player. Team player doesn't mean you don't complain. It means you complain if we are doing something stupid."

3. "We have mentoring. Doesn't always mean the mentor will give you the best advice. I think people should seek out other people to learn from so you have a network of people that will give you feedback."

Source: Farnam Street

8. Crypto Corner

  • Why Ethereum’s merge is a big deal for crypto — and the planet 

  • Stablecoin issuer Tether has four clean days each year 

  • FTX’s money isn’t insured, FDIC says

  • Sudden crypto drop sends Bitcoin to three-week low

  • The SEC treats crypto like the rest of capital markets

  • FTX grew revenue 1,000% during the crypto craze, leaked financials show

9. Memes of the Day

 

 

 

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