Disruptive Media World Plays Havoc With Industry Stocks

Shares of Viacom, Discovery, AMC Networks and Dish Network all fell anywhere from 3.3% to 3.8% on Monday. It's notable, but these are not game-changing declines.

Little to no news surfaced on the day. It's just a snapshot of the stock market with perhaps no visible trend line.

Making sweeping conclusions about this disruptive media world wouldn’t be a good idea. However, at the same time, we know there are long-term seismic changes afoot.

All four media companies are part of the legacy TV ecosystem. All four, some would say, are in need of key partnerships/ownership for the future -- perhaps a significant digital media company, a broadcast TV network, TV-movie studio, or maybe a theme park.

Overall, it was just quiet day in the stock market, with the Dow Jones Industrials Index down 0.2% to 26,511, the S&P 500 falling 0.1% to 2,907, and the Nasdaq losing 0.22% to 8,015.

On the flip side, big digital media companies were higher, with Netflix up 4.7% to $377.34; Roku adding 2.7% to $58.20 and Amazon gaining 1.4% to $1,887.



At the same time, ad technology companies were also boosted. The Trade Desk added 6.2% to $211.03, while Telaria was up 2.4% more to $6.9, Criteo was up 1.3% to $22.25 and LiveRamp gained 1.8% to $56.91.

But for the losers? Think about Disney, and all those who have written up analysis in recent days following Walt Disney’s efforts to launch Disney+, its direct-to-consumer streaming app, which is set to start this November.

Perhaps that announcement has investors worried —not about Disney’s main forthcoming competitor, Netflix, but other more modest media companies. What will the collateral damage be that Disney+ and other big OTT/DTC players render on cable-only TV networks or legacy pay groups like Dish?

Last month, Viacom, AMC and Discovery stocks were hit when DirecTV started new “skinny TV” bundles.

Now, four weeks later, the announcement of Disney+ looks to be a major consumer TV product. Netflix isn’t going away. But what effect does it have on less-resourced, midsize media companies that can’t produce the buzz of big OTT brands?

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