"Exclusives from the Secretive Sun Valley Conference" in Humanizing Tech
Data provided by The Information
The Sun Valley Conference has been going on for the last 30 years, and is an invite-only event for the who’s who in tech and media. Journalists are not allowed inside the conference, but The Information sent a few of their reporters to talk to some of the members who are attending.
All the insights below came from a private conference call for members about what was happening on the ground at this conference. Since I’m a member, you can read the full article that was published by The Information:
- Verizon owns part of Awesomeness TV, an MCN that’s the most successful content provider for Go90 (even though Go90 isn’t that successful); there has been some talk that Verizon might buy Comcast out of their ownership in Awesomeness TV
- Comcast (through acquisition of Universal) and Verizon are increasingly becoming more like media companies
- Verizon is looking to go further into the media space, and are likely to see more of them in this conference in this future
- A big theme this year is that everyone is trying to be like everyone else
- In general we’re seeing tech companies becoming more like media companies, where media companies are trying to become more direct-to-consumer tech companies
- Verizon has been making bids for Yahoo’s core assets
- Yahoo wasn’t talked about much and nobody really cared about Yahoo, even Marissa Mayer wasn’t invited
There is always discussion about ratings from the media companies, mostly because the measurement technology isn’t that great. And now that audiences are leaving their main, profitable TV distribution channels, the question is becoming how best to monetize it.
The more time media executives discuss ratings, the less time they discuss the future strategic vision of their companies. Tech companies are increasingly owning the eyeballs on the web. People are struggling to make comparisons between broadcast TV and digital video, for example comparing Nielsen viewers to YouTube. There’s a problem with traditional TV media businesses showing advertisers that audiences are still there and are not as fragmented in this new OTT world as they actually are.
Cable networks are losing subscribers due to cord cutting, and ESPN will be offering more content very shortly via the web. It will begin with niche live sports content before doing anything with the major properties. They will need to do this if the pay TV market collapses (though that will likely take a long time to play out).
Tim Cook and Eddie Cue were the most visible of any executives at the entire conference. It looked like they were taking more meetings than any other company at Sun Valley.
The question is how Apple is going to evolve as a media company. People were talking about Apple potentially buying a major media company. The Time Warner acquisition rumor was true that discussions were happening. Could there be a potential acquisition of the $160B Disney behemoth? Most folks feel it’s a long shot. But Bob Iger (CEO of Disney) and Tim Cook (CEO of Apple) had a very public meeting right by the coffee shop. Signaling or misdirection?
Apple has long wanted to put a bundle of TV programming into their Apple TV product. But seemingly can’t get the deals done. I also know for a fact that they don’t have the video platform back-end necessary to do this at scale for premium TV and movies. Meta data management is the biggest problem. That’s where Piksel has a tremendous leg up and head start.
People are talking about Apple and original content, but it seems like they’re only taking very small steps towards this at the moment (Beats Video, for one?)
YouTube sealed up some deals for their Live TV bundles. At some point next year, you may be able to watch live sports including ESPN on YouTube. Hulu is also about to do it. Millennials who are on YouTube the most are unlikely to pay for their subscription Red service. YouTube isn’t going to make Netflix style investments into original content. Susan, the CEO of YouTube, has made hires for big media executives. But the margins on this premium content are tiny compared to existing advertising margins.
Netflix vs Amazon as Media Businesses
Netflix is a big investor in Amazon’s content. Will there be a coming war between Netflix and the big media companies like Disney and Time Warner? Unknown, but these companies are responsible for pulling viewers away from linear TV so there’s a real possibility. Many folks are viewing Amazon as a media company, putting them into the same group as CBS, Time Warner, and Viacom.
Traditional media companies have quarterly earnings they have to meet. They’re retisent to cut off the big checks they have to pay out, but hearing the desire to do that for years. It doesn’t seem to be anywhere near happening because of the short-term pressure on earnings.
People don’t see Netflix or Amazon backing off their investment in original content as the race for licensing goes up, so if anything it will be increasing.
A lot of media executives say they watch a lot of Amazon content, so they’re very aware of the value here.
There’s a panel happening with Marc Andreessen from A16Z, Sam Altman from YC, Reid Hoffman from Linkedin. There was a lot of talk about how AI was going to affect companies and all the major tech companies have been working in this area for years. Machine Learning is not a new concept and now likely to see Machine Learning as a Service (MLAAS). Difficult to hire people in the space because the skills are so specific and there’s not a lot of people who know them. Dropbox is investing and so is Expedia.
- Evan Spiegel (Snapchat)
- Travis Kalanick (Uber)
- Logan Green (Lyft)
- Marissa Mayer (Yahoo)
Seems to be a lot more interest from Silicon Valley VCs about this space. There were some panels about biotech. Personally, I see the Health 2.0 wave coming soon, which I’ll be publishing a story on later this weekend or next week.
The only talk at the conference was about Apple Music and the potential acquisition of Tidal, but it wouldn’t be a game changing move.
It didn’t seem to be top of mind at the conference. Mary Barra (CEO & Chairman of GM) has come to the conference for years, as well as John Elkann (Chairman of Fiat Chrysler), so don’t read too much into car makers being there. Google did have a presentation from Chris Urmson (spokesperson for their self-driving car project). It was an impressive presentation (it was a TED talk as well).
Don’t read too much into Lyft hiring an advisor. Also, an acquisition of Lyft doesn’t seem to be on anyone’s radar.
Larry Page was talking to some folks in the new connected cities movement as Alphabet’s Sidewalk Labs initiative. Larry was also spotted talking to Nick Woodson (GoPro Founder & CEO) on the sidelines.
Facebook & Google
The Google-Samsung annual meeting is still a thing. Sundar Pichai (Google CEO) was also in attendance. We can assume he was also meeting with Samsung executives.
Google and Facebook have the most official attendees, and must have the most tickets. Not sure why this is but maybe they do a lot of business with Allen & Co (putting on the conference).
Disney Investment into MLBAM
Disney acquired a 33% stake in MLBAM recently with an option to acquire another 33% and take controlling interest. The deal hasn’t closed yet. But there was a lot of talk about it this week. Lots of discussion internally about whether this was the right strategic move by Disney. The question is does it give them a faster way to get direct-to-consumer distribution point.
There was a session discussing the impact of Brexit on the business world. The short answer is nobody really knows. There are some M&A deals in the UK that have been put on hold because there’s some uncertainty for staffing and what it would mean. So there is some short-term impact but nobody has any clarity about how it will turn out long-term.
Also a lot of concern about Trump succeeding and how that affects Brexit. People seem to be burned out by Trump and Hillary’s email scandel.
Microsoft’s Linkedin’s Acquisition
Jeff Weiner (CEO of Linkedin) is talking up the deal for Linkedin, but a lot of head scratching about why Microsoft paid so much for it ($26B). Jeff’s job is selling the deal at the conference, and it seems like Linkedin will maintain its independence from Microsoft.
Tone of Deal Making In General
It was tough to take the temperature of whether deals would be happening between the major players. Still lots of apprehension of whether the tech industry will make a major move in the content direction (e.g., Apple buying a Disney or Time Warner). Some people describe it more like both sides are dipping their toes into the water. Some of the biggest buyers don’t seem to be top of mind.
However, there were some discussions of companies like Liberty buying a Viacom or pieces within Paramount.
That said, there are a lot of the pieces already in place for an acquisition between Tech and Media. Media companies may have a lot more pressure than the tech companies, who are more opportunistic regardless of the macro situation.
Also, tech companies traditionally don’t like to scoop up troubled assets, like a Twitter or Yahoo. They’re not a private equity company. But if they see an opportunity for a growth asset they will take it.
There was a conversation with the Executive Chairman of Twitter. Jack Dorsey was in attendance. Talked about the recent appointment of Bret Taylor to the board (former CTO of Facebook). They were presenting themselves in a positive tone. Previously they talked about leveraging the logged out users and now it’s very different from that, because they’re doing the boring stuff (i.e., fixing the product).
Twitter said that if acquisition offers come in, they will discuss it. There has been some discussion with Google as a potential acquirer and there is the long-standing partnership about presenting tweets in search that is likely to continue.
Google isn’t in the business of buying a turnaround product. And Twitter isn’t a growth asset. Facebook sees Twitter as an important megaphone for celebrites and important people, so that’s part of the reason Facebook has built live products and features to support them.
Media Companies & AI
Not much conversation around media companies and artificial intelligence. A lot of people look at the IBM / Weather Channel deal but it was really just a data play. AI is not on the minds of traditional media companies like it’s on the mind of tech companies.
Media people don’t quite see the direct connection with AI. It could be that Ad Tech and AI merge, which is how they can measure audiences in a digital era.
Apprently nobody has yet got the memo about why Piksel is investing so heavily in artificial intelligence for premium an social media for online video.
There was also a lot of talk about VR, including Magic Leap, at the conference.
Exclusives from the Secretive Sun Valley Conference was originally published in Humanizing Tech on Medium, where people are continuing the conversation by highlighting and responding to this story.
from Sean Everett on Medium http://ift.tt/29mTCAq