Brokerage Recommends The Walt Disney Company Shut Down ABC
Tension in the US has raised concern for media company's and their share holders.
Brokerage company Needham is recommending Disney shutdown the ABC network and move the channel’s content to streaming after the Jimmy Kimmel Live! disaster earlier this month.
What’s Happening:
- As Reuters reports, brokerage firm Needham is suggesting The Walt Disney Company move all ABC content to streaming, shutting down traditional linear TV content.
- The recommendation arrives on the heels of the network’s controversial move to place Jimmy Kimmel Live! on an indefinite hiatus before reinstating him last night.
- While the late night talk show has returned, tensions surrounding the situation continue, leading the brokerage to raise concern regarding the “volatility" of broadcasting licenses.
- While ABC is an incredibly important part of Disney’s reach and sports rights negotiations, the network has been in a steady decline as consumers switch to streaming platforms.
- Disney has yet to comment on the recommendation.
What They’re Saying:
- Needham & Company: The recent "FCC intervention has made owning broadcasting licenses too expensive and too volatile for Disney shareholders, in our view."
- Paul Verna, Vice President of Content at Emarketer: "While the current brouhaha over 'Live with Jimmy Kimmel' might force (CEO Bob) Iger to reconsider his plans, I don't envision a scenario where a sale, spinoff, or shutdown of ABC TV happens any time soon."
My Thoughts:
- It seems unlikely Disney will jump the gun on completely axing ABC, but it will be interesting to see how the future plays out due to declining linear TV content and the President’s threats against the network.
Jimmy Kimmel’s (Near) Return:
- While ABC resurrected Jimmy Kimmel Live! from its indefinite hiatus, the two largest ABC affiliate owners have opted out of airing the late-night show.
- Sinclair, Inc and Nexstar, which own a combined 70 ABC affiliate channels around the US, have both chosen to fill that timeslot with local news and other programming relevant to its respective markets.
- For more information on whether your local ABC channel has been affected, you can check out our full list.
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