Twitter has announced a wide-ranging content and advertising partnership (among 30 renewals and new video deals) with The Walt Disney Company (DIS), as the online news and social networking company continues to invest in video content. The deal, which spans the entire DIS portfolio, includes live original ESPN programming. 2 shows have been introduced thus far, SportsCenter Live (TWTR version of the flagship program) and Fantasy Focus Live (live stream of a fantasy sports podcast). Expect ESPN to share some additional insight on the partnership at their Digital Content NewFronts event on Wednesday.
Howie Long-Short: It’s logical for TWTR to continue to invest in live video content, because it’s working; daily video views on the platform are up +/-100% over the 12 mo. and video is now responsible for more than 50% of the ad revenue. As Global VP of Revenue and Content Partnerships Matthew Derella pointed out, the company’s “super power” is its ability to tie conversation to video during the biggest moment; “giving brands the unique ability to connect with leaned in consumers.” Shares rose 4.5% on Monday’s announcements, closing at $30.31.
TWTR reported Q1 earnings last week, the company’s 2nd consecutive profitable quarter and 2nd profitable quarter ever. Quarterly revenue was up 21% and the company said it expects to be profitable in 2018. Ad revenue is driving the growth, as more brands are shifting marketing dollars from traditional television to digital outlets.
Fun Fact: In 2016, DIS had explored the purchase of TWTR; ultimately passing on the deal amidst concerns of the company’s inability to curb hate speech and trolling on its platform.
Fan Marino: Amazon (AMZN) also recently beefed up its sports video programming, acquiring exclusive rights to stream the U.S. Open Tennis Championships in U.K. and Ireland and renewing its exclusive Thursday Night Football streaming rights through the 2019 season. The 2-year deal worth $130 million (or $15 million more/season than the $50 million paid in 2017), gives the e-commerce giant the rights to stream 11 games during the 2018 season. On May 11th, the cost of Amazon Prime will increase from $99/mo. to $119/mo. With 100 million active members and another $2 billion in potential revenue awaiting, a $15 million annual increase for TNF streaming rights is just a drop in the bucket.
Amazon also just delivered impressive Q1 ’18 results, posting its most profitable quarter ever. Q1 revenue was up 43% to $35.7 billion, with net income up 121% to $1.6 billion. The company’s cloud computing business (+49% YoY to $5.44 billion), subscription services (think: Amazon Music, +60% YoY to $3.1 billion) and ad revenue (+139% YoY to $2.03 billion) all contributed to the record quarter.
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