This is what the flax. I'm Brett and I'm Justin and it's Friday, the nineteenth of December. In this recap episode, we're breaking down the biggest streaming stories of twenty twenty five. Twenty twenty five was a turning point for streaming. It was about big deals, ownership shakeups and platforms that are picking new sides. So let's take a recap of the three biggest streaming stories of twenty twenty five in Australia and around the world.
Three massive stories today, Juzzy boy let's do it for our first. Dezone, the sports streaming platform and Foxtel's new owner, has made a US nine hundred and thirty six million dollar loss in twenty twenty four.
Nothing like a company that celebrates losing slightly less money this year, so tell.
Me more so. De Zone spelled da z N was founded in twenty fifteen and has ambitions to become the Spotify of sport.
Yeah. It's a global sports streaming service owned by Access Industries, which is a private investment group owned by Len Blavatnik and Jasey Boyd.
The Zone has made quite the splash in Australia recently after acquiring Foxtel for two point two billion dollars.
But then, man, it ain't just Foxtel. De Zone also owns broadcast rights to the Bundesliga and LaLiga Soccer.
Also Boxing MMA, the NFL internationally.
Now, the good news for de Zone is that it's revenue climb to three point two billion US dollars in twenty twenty four.
All right, hit me with some bad news, juzzy boy.
Well, despite that revenue, the Zone still made a nine hundred and thirty six million US dollar loss for the year, which is actually.
A better performance than it's a one point four billion dollar loss the year before.
So to keep the lights on, do Zone had to call in a billion dollars from Saudi Arabia's sovereign wealth.
Fun and don't forget five hundred and eighty seven million dollars from Access Industries.
But do Zone CEO reckons twenty twenty six is its year as it pushes towards profitability.
Big talk for a team still deep in the red zone.
So what is the key leading here?
The path to profitability is the journey a company takes from operating at a loss to generating consistent net income.
Yeah, For high growth companies, early life are often a bit part of the plan.
It's the price of building technology or buying rights attracting millions of customers.
But for these high growth companies, the key is also showing a clear path towards profitability.
Or else investors can feel like they're investing good money after bad and ultimately just lose hope.
That's not to say it is impossible to hit profitability after many years be man. Take Amazon for example, uh huh.
It's spent nearly nine years focused purely on growth before turning its very first annual profit in two thousand and three, and.
Ubertook even longer. They reported their first operating profit fourteen years after launching.
So Juzzy Boy. If de Zone wants to become the quote Spotify of sport, it needs to start showing can actually become a sustainable business.
For our second story, YouTube has smashed viewership records and ad revenue as it competes head on with old school TV channels.
YouTube's come a long way since Charlie bit my finger. So tell me more, okay? So YouTube is owned by Alphabet, which also owns Google, Google Cloud, Android, bit Bit, Gemini Way mow and plenty more and the man.
Google bought YouTube back in two thousand and six for just one point sixty five billion US dollars.
And now YouTube is making nearly eight times that amount in advertising revenue each and every year.
That's right, YouTube's ad revenue jumped to nine point eight billion US dollars in the past year, which was up thirteen percent.
But even scarier than that, Juzzy Boy, is that YouTube isn't just an online video streaming platform anymore.
It's considered more of a fully fledged TV network because of its ability to be connected to your TV.
In fact, YouTube now accounts for twelve point eight percent of all TV viewership.
That's the high share any platform has ever hit, according to Nielsen and Juzzy Wait, this is just another reminder of how connected TV has crushed old school TV networks and will probably continue to do so a RIP network ten So what is the key learning here?
Connected TV or CTV is the new battleground for advertisers, and YouTube has already won the first few rounds of this battle.
You say, by man. Unlike traditional TV ads, which are often hard to measure, CTV ads are delivered via Internet connected TVs.
That means they can target their audience a whole lot better.
They know what that viewers watched previously as well as their interests.
They can track data on the performance of the ads as well.
Yeah, they're not guessing that the audience of the block is middle aged men and women in a two story house in metro Melbourne or Sydney. In fact, by Man YouTube claims CTV ads on its platform drove over one billion conversions in the past twelve months.
So Josey boy YouTube isn't just an online video platform no more.
It's a TV network, a search engine, a music service, and an ad tech beast all in one.
And clearly it is working. Yeah.
For our third and final story, Paramount has crashed the Hollywood party with a one hundred and eight billion US dollar hostile bid for Warner Brothers.
Discovery puts the popcorn in that microwave. Jussy Boy, close the door, because this is peak Hollywood drama. Tell me more.
Okay, So Warner Brothers Discovery is the entertainment giant behind HBO, CNN, DC, Comics, Harry Potter, and HBO Max as well.
This is the company that actually merged Warner Brothers and Discovery back in April twenty twenty two in a forty three billion dollar merger and b man Netflix.
Well, they need absolutely no introduction at all.
Late last week, Netflix announced a deal to acquire Warner Brothers Discovery studio and streaming business including HBO Max.
Yeah, this is a cash and stock offer that valued this part of the business at seventy two billion US dollars in equity.
But this didn't include the discovery part of the business.
And the man at the time, this deal was announced and approved by Warner brother Discoveries board, and it seemed like it was all wrapped up in a nice and little package.
Until Paramount Skydants entered the chat.
Yeah. Paramount is now owned by David Ellison, sign of Oracle founder Larry Ellison, and.
He has just launched an all cash, hostile takeover to Warner Brothers Discovery.
Paramounts offered to buy the entirety of Warner Brothers Discovery in a one hundred and eight billion US dollar all cash deal. A little late for this deal now, Juzzy Boy shortly and that's why Paramount's offer is a hostile one.
Yeah, they're taking their case directly to Warner brother Discovery's shareholders, but Warner Bro Discoveries board still recommends the Netflix deal for now. So what's the key learning here?
A hostile takeover is basically a corporate git crashing.
It happens when a company attempts to acquire another business by going directly to shareholders rather than negotiating with its board.
It usually occurs when the target company has rejected previous bids or prefers another buyer, like Warner choosing Netflix. And in this scenario, Paramount is launching a tender.
Offer that means shareholders receive a public invitation to sell their shares at a specific price, in this case thirty bukker rounies per share, which is.
Even higher than the Netflix offer of twenty seven dollars per share.
And this tender offer bypasses management entirely. I mean, for Paramount, the.
Goal is to accumulate enough shares to gain a majority or controlling stake in Water Brothers Discovery.
And this would then allow them to replace the existing board and push the deal through.
And the man, let me tell you, isn't the first time the Ellisons have done a hostile.
Takeover, all the way back two thousand and five Oracle, which was bounded by Ellison's father, they launched a hostile takeover offer for a company called PeopleSoft.
Eblesoft tried to reject the offer multiple times that Oracle one and that support from shareholders to force the sale to happen.
Next minute, deal closed and PeopleSoft became part of Oracle's Enterprise software division for ten point three billion US dollars.
So, while tender offers rarely succeed, the Ellisons have a tried and tested playbook.
Thanks for listening, and we'll see you on Monday,