Bernstein Research said Friday that influential media analyst Todd Juenger will take a sabbatical and that it would temporarily suspend coverage of media companies in his absence. 

“We are temporarily suspending coverage of U.S. Media because the Senior Analyst (Todd Juenger) is going on sabbatical,” Bernstein said in an email message to clients. “We plan to reinstate coverage following the Senior Analyst's return in a couple of months. Effective today, July 30, 2021, our previous reports, ratings, target prices and earnings estimates should no longer be relied upon. Team members can be contacted with requests for pre-existing models and content.”

Juenger joined Bernstein in 2012 after heading up TiVo’s Audience Research business. At Bernstein he made a name for himself quickly with insightful coverage of programming stocks like Viacom (now ViacomCBS), The Walt Disney Co., News Corp (now Fox Corp.), Time Warner (now AT&T), and Netflix. His April 2012 report tying Netflix licensing deals to the precipitous drop in ratings for kids’ programming at cable networks was one of the first to highlight the impact of streaming services on linear TV.

Juenger’s current coverage list includes programmers ViacomCBS, Discovery, AMC Networks, Disney, Lionsgate Entertainment, and Netflix; ratings measurement giant Nielsen; music companies Spotify Technology and Warner Music Group; and video game companies Activision Blizzard, Electronic Arts, and Take-Two Interactive Software.    

Bernstein's coverage of U.S. cable operators, satellite TV and telecom companies, currently handled by senior analyst Peter Supino, will not be affected.  

Vice Media Group, apparently close to a deal with a blank check fund that will allow it to go public, is once again becoming the example that investment schoolmarms point to when warning about throwing good money at the latest fad. But for all the tsk-tsking, it really shouldn’t come as a surprise that Vice, once the epitome of the brash, take-no-prisoners, let’s-break-stuff management style, is now valued at less than half what it was at its height four years ago. It’s partners did that ages ago.

According to The Information, Vice Media is talking with at least two unnamed special purpose acquisition corporations (SPACs), one of which made an offer that values the media operation at about $2.5 billion, or less than half the $5.7 billion it was valued at in 2017. 

According to some reports, Vice Media’s global revenue was about $600 million in 2020 -- about the same as in 2019 -- making the $2.5 billion valuation about four times revenue. 

While Vice seeks out some kind of lifeline, another digital company that appears to be the target of SPACs -- Buzzfeed -- appears to be having better luck. 

Buzzfeed, according to The Information, is being courted by a SPAC -- 890 Fifth Avenue Partners -- that values it at slightly below its peak $1.7 billion valuation. 

Vice grabbed a lot of headlines in 2017 when private equity fund TPG Capital invested about $450 million in the media company, giving it that eye-popping $5.7 billion valuation. That was nearly twice the market cap of AMC Networks -- home of the most watched program on cable at the time The Walking Dead -- for a media company that was ready, by its own admission, to take the cable business by storm.

That storm never happened. Viceland, the network that took the place of H2, the network even History Channel forgot, rebranded as Vice TV last year and has continued to have middling ratings. Its most-watched show is Dark Side of the Ring, a wrestling docu-series that averages under 400,000 live-plus-three viewers in the coveted 18-49 year old age bracket. The rest of its programming lineup is a mix of “edgy” programming like F*ck That’s Delicious, Gaycation and Balls Deep, as well as reruns of It's Always Sunny in Philadelphia. 

Also Read: Of Vice and Men

But signs that the wheels were falling off the Vice Media gravy train were apparent as early as in 2018, when Disney, which invested $400 million in Vice Media in 2014, took a $157 million impairment to that stake in 2018 and another $353 million impairment in 2019. 

According to its last 10-K annual report, filed in November. Disney effectively owns a 24% interest in Vice (14% fully diluted), that it deems essentially worthless. 

Now, Disney’s write-down doesn’t man that Vice Media is worth nothing, just that Disney doesn’t believe it will ever get its money back. But the write-off still was a smudge on Vice’s once bright veneer.  

Seasoned programming executive Nancy Dubuc took the helm of Vice in 2018 and has been looking for a way to make its anxious investors whole for years. Talk of an IPO first surfaced in 2019, and Dubuc reportedly renegotiated the terms of the TPG investment -- replacing stock and cash dividend payments to the PE firm with preferred equity awards.  That gave Vice some breathing room, as it moves toward profitability. This year, with the surge in SPAC offerings looking to put their money somewhere, anywhere, in the media space, Vice has attracted some attention. 

SPACs have the money -- according to SPAC Insider, 270 SPACs have been created this year raising $88 billion -- to invest in the media space, but not necessarily the stomach. 

Also Read: SPACs: The (New) Final Frontier 

While there have been some SPAC programming investments -- notably Software Acquisition Corp.’s purchase of CuriosityStream last year -- they have generally steered clear of television. The main reason, some SPAC executives say, is that consolidation in the industry has already taken place.  

But Vice Media isn’t just TV. Its biggest business is in digital media, with websites like Munchies, Motherboard, Noisey, i-D and Garage. Vice Studios has produced films like The Report, starring Adam Driver and Annette Bening; Harmony Korine’s The Beach Bum; and Netflix docu-series 1994.  But there too lies a problem. Vice Media’s websites don’t appear to be growing that much.

According to web analytics company SimilarWeb, vice.com ranks 101st among news sites and averaged about 30.29 million total visits in February. In contrast, SimilarWeb ranked Buzzfeed.com 29th among news sites with 125.24 million total visits in February.

On its own website, Vice says its digital properties attract about 50.4 million unique visitors per month in the U.S. and 135 million globally.  

Also Read: Losing Cool? 

Former and current media executives have hopped on the SPAC bandwagon recently. Dish chairman Charlie Ergen launched a $1  billion SPAC (CONX Corp.) in October that has since lowered that amount to about $750 million;  John Malone’s Liberty Media closed the $575 million Liberty Acquisition Corp. SPAC in January;  former AT&T Broadband and YES Network chief Leo J. Hindery Jr. launched two SPACs -- Trine Acquisition and Trine Acquisition II ; former WWE executives George Barrios and Michelle Wilson  are trying to raise $200 million through their own SPAC vehicle (Isos Acquisition); and former Disney executives Kevin Mayer and Tom Staggs raised $250 million through their Forest Road Acquisition SPAC -- so there is no scarcity of media expertise in the space. And let’s not forget that the most successful line of SPACs to date -- Eagle Investment Partners, which last year purchased online sports betting giant DraftKings -- is led by two former media executives, former MGM Chairman Harry Sloan and former CBS Entertainment chief Jeff Sagansky. 

That scarcity of available media assets would appear to be in Vice Media’s favor, but at least one exec has said there are other factors that would serve as roadblocks to a deal.

“On the one hand, it seems like a bad neighborhood,” said one SPAC executive who asked not to be named. “I think of the other names that seem similar to Vice over the past few years -- Mashable, Gawker, the Univision properties -- there were several that effectively billed themselves as strong digital media companies that had their finger on the zeitgeist of millennials and would capitalize on all the Facebook and Google advertising to grow their top line.”

That obviously didn’t happen as planned. And the decline in digital properties isn’t specific to Vice. Everyone in the space has seen their lofty valuations plummet.Vice has been singled out in part because if its brash owner -- Smith once said that a year from the launch of Viceland he would be on the cover of Time as the guy that brought millennials back to TV  -- and accusations of sexual harassment and a frat boy culture that caused some shakeups in the ranks. 

Vice has made some big strides in dismantling the boys club culture -- its latest diversity and inclusion report notes that 56% of its employees identify as women, as well as 58% of new hires. 

But that combination of bad press and a declining market with no obvious growth resolution has made a private capital injection unlikely and an IPO out of the question for Vice. That leaves the SPAC door open. 

A SPAC would be an efficient way for Vice to get enough capital to clean up its balance sheet, get some money to fund growth and give early investors at least some of their money back. 

“You have to cash all of these guys out,” said the SPAC executive. “From the standpoint of the people whose money is trapped, the SPAC is an amazing solution.”

But the nagging question remains: If Vice couldn’t reach revenue milestones in the past, what’s to say it won’t miss them again?

“There is a fair price for Vice, and if they hit the right price it can trade and make a lot of shareholders happy,” the executive said. “I just don't understand how they are going to solve the core issue of how the industry is in bad shape and the company just doesn’t have the goods to deliver.” 

The SPAC executive said that Vice has been shopped to just about every blank check company looking at the media space, and added that while he was not privy to which ones are taking a closer look, TPG could ultimately be a player as well. TPG has its own SPACs -- earlier this month it launched TPG Pace Tech Opportunities II Corp, TPG Pace Beneficial II Corp and TPG Pace Solutions Corp with the intention of raising more than $1 billion to invest in technology, media and telecom firms. TPG has a lot of experience with the SPAC format, having raised billions of dollars through several SPAC vehicles over the years. Most recently, its TPG Pace Tech Opportunities SPAC agreed to purchase tech company Nerdy in a deal that valued that firm at $1.7 billion.

TPG could take the same route with Vice Media, agreeing to buy the company at a lower valuation in return for a larger equity stake. That would allow Vice to pay down some of its debt, get capital to run the business and give TPG a larger piece of a smaller pie. 

“Over time the share price will go up and they can monetize that investment at various share prices and get back their money,” the SPAC executive said. “But it all requires that the growth is really there. That would be a clever way for TPG to use the structure to potentially get out of this.”  

And like some other vices, getting out from under is the ultimate goal. 

Former Walt Disney Co. streaming chief Kevin Mayer and former chief operating officer Thomas Staggs have teamed up with basketball legend Shaquille O’Neal on a special purpose acquisition company, set on raising $250 million to buy a company in the telecom, media and technology space. 

Forest Road Acquisition Corp. is led by CEO Keith Horn, a long-time financial executive and chief financial officer Salil Mehta, a former Disney EVP. Joining them are Staggs, who will serve as chairman of the SPAC’s strategic advisory committee, Mayer and O’Neal, who will serve as strategic advisers.

Mayer, who was in charge of Disney’s streaming efforts -- including Disney Plus -- left the company in May to become CEO of internet icon TikTok. He resigned from that position in August. Staggs left Disney in 2016 after serving as chief financial officer and chief operating officer of the entertainment giant.

Former Los Angeles Laker and NBA Hall of Famer O’Neal currently serves as an NBA commentator for cable network TNT and is a long-time investor. 

Related: SPACs: The New Final Frontier 

Forest Road is just the latest in what has been an impressive string of SPACs launched this year. According to SPACInsider, 138 SPACs were created in 2020, raising $53.8 billion. Recent SPAC deals include CuriosityStream, which merged with Software Acquisitions Group in August. SPACs led by former MGM chairman Harry Sloan and former CBS Entertainment president Jeff Sagansky have raised more than $3 billion and merged with companies like sports betting giant DraftKings. 

In its prospectus, Forest Road said its team is uniquely positioned to find opportunities in the TMT space.

Other advisers include civil rights activist and Bounce TV co-founder Martin Luther King III; TV and film producer Mark Burg (the Saw franchise and Two and a Half Men); and former entertainment executive and TV and film producer Peter Schlessel. 

“We believe that our team’s distinguished and long-term track record of sourcing, acquiring, and building next-generation media and entertainment platforms, along with other investments and operational experience in consumer-facing industries, will provide us with differentiated consumer insights and sourcing opportunities,” Forest Road said in its prospectus.   

Forest Road added that it sees opportunities in the media space as the industry continues to shaft toward streaming distribution. The rising number of streaming video service providers  and demand for premium content also presents opportunities.

“We believe that media and entertainment is undergoing rapid and aggressive technology-induced change, resulting in new monetization opportunities and secular growth as opportunities to reach consumers expand, new entrants seek to gain market share, and the “old guard” adapts to the evolving needs of today’s consumers,” Forest Road said. “We believe that our team’s experience in building and executing strategies that combine capabilities and expertise in consumer preferences and technology/product development will differentiate our ability to source a successful partner.”

While Forest Road will focus on entertainment targets, another SPAC launched Friday by Atlanta Falcons minority owner Alan Kestenbaum will hone in opportunities in the sports arena including teams and regional sports networks.

Kestenbaum has joined forces with two top sports investors to form Sports Ventures Acquisition Corp. (SVAC) and raise about $200 million.

Among the possible targets listed in the SVAC prospectus, filed with the Securities and Exchange Commission on Oct. 8, are U.S. sports teams, European soccer clubs, rugby, esports and cricket teams. The SPAC also listed regional sports networks, sports media rights and  as possible interests.

In the media and entertainment fields, SVAC will eye film and television production companies,  in the U.S. and private companies in the sports media and entertainment field, including television and film production and be headed by Kestenbaum as CEO. He holds a minority interest in the NFL Atlanta Falcons, and is currently CEO of StelCo Holdings, one of the largest steel companies in Canada. His partners include Inner Circle Sports founder Rob Tilliss and GlassBridge Enterprises CEO Daniel Strauss. 

The sports SPAC field also is getting increasingly crowded. Earlier this year former Goldman Sachs executive and YES Network investor Gerry Cardinale launched RedBall Acquisitions with Oakland A’s EVP of baseball operations Billy Beane, raising about $575 million.  RedBall is reportedly looking to buy an English Premier League team.   Earlier this month, Sports Entertainment Acquisition Corp., created by several former NFL executives, raised about $400 million and are seeking potential targets in the sports, entertainment and technology industries.  

The President hammered the news media Tuesday (Oct. 6), suggesting COVID-19 response was akin to a political competition the media wasn't giving him credit for winning and calling it a "disgrace that NBC would use the public airwaves for a Joe Biden town hall meeting."

The President's own COVID-19 diagnosis has not affected his Twitter finger, where in addition to the two media-related slams Twitter flagged an earlier tweet:

"Flu season is coming up! Many people every year, sometimes over 100,000, and despite the Vaccine, die from the Flu. Are we going to close down our Country? No, we have learned to live with it, just like we are learning to live with Covid, in most populations far less lethal!!!."

Twitter said that violated its rules about spreading "misleading and potentially harmful" information about the virus.

He issued the following in early afternoon:

That was followed by his critique of NBC's Biden town hall:

President Trump's attacks on the media appear to have had an impact on his Republican supporters. That is according to a new Pew Research Center survey and analysis. 

"The link between the public’s approval of President Trump and views of the news media is clear in evaluations of journalists’ ethics," said Pew. 

Related: White House Spokesfolk Echo President Attacks on Press 

According to the study, almost a third of all Republicans and Republican-leaning independents (31%) say that journalists have "very low" ethical standards. By comparison, only about 5% of Democrats/Democratic leaners say that.  

Among Republicans who strongly support Trump, 40% say journalists have low ethical standards, while only 17% of those Republicans who only approve "somewhat" of Trump say that.  

The study data was gleaned from 12,256 members of Pew Research Center’s American Trends Panel (ATP) who participated in at least one of seven surveys between February 2018 and July 2019.

African-American consumers continue to lead the consumption of content across multiple platforms, according to a recent Nielsen 2019 Diverse Intelligence Series (DIS) report on African Americans.

Nielsen’s It’s In The Bag: Black Consumers’ Path to Purchase report states that African-Americans continue to be voracious consumers of television content, spending more than 50 hours watching live and time-shifted television a week in first quarter 2019, over 10 hours more than the total population, according to the research company.

“It doesn’t matter how many other streaming services we have access to, traditional television viewing is still number one with the African-American population,” said Cheryl Grace, senior vice president of U.S. strategic community alliances and consumer engagement for Nielsen. “What that looks like is 91% of every African-American can be reached weekly via television primarily through what we’re watching in real time and what we save on our recording devices.”

The tv shows African-Americans are watching don't always match that of the general population as black viewers gravitate more towards content that reflect their images and storylines -- particularly among younger viewers. Among adults 18-34, only Fox’s 911 and Empire show up among the top 20 most watched shows for both the African-Americans and the total population. VH1’s Love & Hip Hop franchise, Black Inc. Crew and Fox’s  cancelled Star are among the top 10 most-watched shows in young, African-American households that are not ranked on the top 20 most-watched TV show list for the total population.

Despite  heavy usage of traditional media, African-American consumers are on the cutting edge of new content distribution platforms and devices. Overall, 61% of African Americans are fascinated by new technology and 37% are more likely than the total population to be the first among their peers to try new technology products, according to Nielsen.

That includes a whopping 96% of all African-American adults having and using a smartphone, compared to 95% of the total population, according to Nielsen. Further, African-Americans 35 and older surpass all consumers in their age group by 2% for smartphone ownership.

Not surprisingly, African-Americans spend more time consuming video on their android phones and iPhones compared to the total population. Nielsen reports that Blacks spend nearly 30 hours a week on websites and apps on their smartphones, more than three hours more than the all consumers as a whole.

Youtube is the most consumed entertainment app for African-Americans at 79%, while Netflix has the highest market share among subscription video on demand apps with 39%, according to Nielsen. Hulu is second with 15%, followed closely by Amazon Prime Video at 14%.

On the social media front, Facebook is the top choice for African-American adults, with more than 65% of black adults using the service, according to Nielsen. Grace added that African-Americans overindex in the use of other social media services such as Instagram, SnapChat, Pinetrest and Twitter compared to the total population.

Yet despite African American consumers’ high consumption of traditional and new media -- as well as an estimated annual buying power of $1.3 trillion dollars -- Grace said companies are not increasing ad dollars targeting black consumers. She added that about $18 billion was spent on African-American-focused media in 2018, an overall decline of 5% from the prior year, with declines in such platforms as cable television (down 1%), digital media (-12%), network TV (-13%) and syndicated TV (-11%)

“Unfortunately despite how much we watch television and look at our digital devices, it doesn’t add up to the [ad] spend that we’re seeing,” she said. “We’re watching more, and yet [advertisers] are spending less to reach us. This is a problem.” 

Artificial intelligence is fast becoming an essential ingredient for an array of solutions across all industries – which promises to transform every aspect of our lives. While intelligence similar to (or perhaps even surpassing) that of humans may emerge in the not-too-distant future, it’s clear from our collective everyday experience we are not there yet. We are, however, firmly on the path. And there are steps we can take to create the brighter future we desire.

This is especially important when it comes to the media and publishing industry.

Trust is increasingly hard-earned

Concepts of truth and accuracy in reporting and storytelling are being tested as never before. AI driven newsfeeds have given rise to Fake News. And with Deep Fakes, content creation and manipulation have become less expensive and virality impartial to truth. Yet we the people feed the demon, as speed to market and sensation is rewarded, whereas quality, accuracy, and truth borne of patience, less so. Often these are a result of quick-fix solutions to core business model challenges, whereas figuring out the right model is much harder though enduring.

So how do we maintain and build a publishing business in this complicated high-risk high reward climate? How do we to capture the full benefits of today’s AI without losing control of what makes our brand (and our advertisers’ brands) unique, powerful and human?

Home is where you create value

For the past 20 years I’ve advocated for the adoption of advanced technologies, yet always calling attention to the need to first set the stage for the technology to most effectively achieve its goal while limiting the potential for adverse outcomes. Otherwise, the risks for adopting, then soon after sunsetting, the technology increases. With that, a burn of unfulfilled expectations (and empty pockets) lingers long across our teams and companies.

Without a doubt, the greatest step a media company can take in preparation for AI is to position itself to have a direct relationship with the user. One’s owned and operated properties (be they on desktop, mobile, OTT, or elsewhere) are the ground zero locations for capturing and developing these relationships.

If it’s an audience you can’t equitably monetize, can’t learn from, can’t leverage for improving what shows you cast, produce, distribute, and build your business from, is it an audience? Ask Defy Media how that worked out. Or Disney’s recent write-down of its stake in Vice.

It’s true that we can’t expect the O&O “we built it, so they will come” mindset to succeed on its own. We DO need to go where the audience is. Deals with YouTube, Instagram, Snapchat, are necessary and smart, especially if we are to start thinking about content and shows as “Omni-brands” that can and need to live everywhere and anywhere. But we must not primarily invest where we give the goods away. I walk into way too many meetings where this is the team that’s funded, not the guardians and builders of the house.

It is within the four walls of your O&O house that you are able to create a clearly defined and controlled experience for your customers around who you are, why you matter, the benefits of sticking around and returning. It’s your scientific laboratory – where else are you going to get such clear unfiltered signal to test what’s working and not, to inform content creation, distribution, licensing, business models, new products, and all other experience and brand defining investments?

Laying the foundation for AI

Getting the house in order is no easy affair, but its table stakes. This includes having a common framework for testing, deploying and learning. Centralization and standardization of assets and a common data model with dynamic taxonomies are the foundation from which all advanced cognitive systems can operate.

With your home base well established, investments across the board begin to yield fruit. The user experience and every interaction yield the data and metrics and nurture a culture of testing that drives the virtuous process that sustainable businesses are built on.

Now you can implement AI within an environment that addresses real gaps in measurable ways and with reduced risk of overshooting.

Applications for AI in Video Programming

Are you a newsroom that needs to grow your audience by increasing watch times? While breaking news gets the most views, it’s not always monetizable - is it possible to optimize content programming to surface videos that are relevant and more monetizable? If so, can this be done within a fluid high-risk newsroom environment where trust is key?

It is not only possible, but it is becoming a requirement to implement video automation and at-scale on a one-to-one level. That path to this is leveraging deep context data gathered from your videos and learning from your audience and how they’re engaging at all levels of your site, holistically across each video experience, across each site and mobile and OTT environment. And put the controls in place to boost only those videos that drive revenue not cost.

Are you a national news network of many sites each in local areas with smaller audiences trying to figure out how to best manage content, ad sales, across each yet tied back to a national presence?

Are you a global sports brand that needs to tie content together contextually, in a deeper way than on top-level category, to package up premium brand-safe and brand-aligned content, in order to realize premium CPM and budget from one of the most finicky ad brands?

Are you a Broadcaster launching a new OTT service, in one of the most competitive environments to-date, with limited information about new subscribers and a need to quickly solve for the “cold start” problem?

Are you a broadcaster looking to prove/disprove the hypothesis that longer content will bring and engage more millennials and Generation Z audiences, prior to making the significantly increased investment in content production?

If any of these scenarios describe familiar challenges heading into 2019 and beyond, then integrating AI into your programming stack and a culture of testing into your organization is your path to success.

A is for Augment

Sabermetrics and Moneyball did not replace baseball GMs, managers, and scouts but rather augmented their intelligence and decades of wisdom and instinct. They are empowered with data-driven insight to make informed decisions. The same is true for a disrupted media and entertainment industry where the stakes couldn't be higher.

For as long as it will be humans consuming content, (I’d like to believe) that it will be important for humans to have a hand in creating and distributing that content. Which means humans and machines working optimally together.

My view on this may change should the world that futurists predict come to pass – where all travel is through automated intelligent vehicles, opportunities for work are limited and there is no longer need for critical thinking, discernment, or free will (should we have ever had it in the first place). I’ll just take my set of personalized whole-life-vitamins spoon fed to give me the life I’m supposed to need.

But we’re not there yet. So let’s celebrate this moment and take control of the content we want to consume and the businesses and society we want to build.

An internet meme "quoting" Abraham Lincoln about internet truth has been a favorite for the past few years. The only thing better is a version of Lincoln's "advice" about not believing "everything you read on the internet" accompanied by an illustration of Benjamin Franklin. (I have been unable to confirm if the designer of the Franklin version was being ironic or ignorant - a fitting factor for this discussion.)

These admonitions came to mind as I reviewed an NBC report last week about "Headline Stress Disorder." Although NBC's focus was on the negative effect of non-stop downbeat news coverage, a larger issue emerges: How will media deal with the public's trust - or disdain - for media?

Does the bubbling desire to "kill the messenger" apply only to news channels (which are actually thriving), or could it ripple over to other conventional media content? Several analyses of the popularity of feel-good programming, such as Hallmark Channel's Christmas movie spree (for example: this Forbes story) characterized it as a way to escape the stresses of the season and of these times.

In the American Psychological Association study, which was the basis for the NBC report, and in a newer APA "Stress in America" study conducted by Harris Poll, 72 percent of Americans said they believe the media "blows things out of proportion." Most adults (95 percent) say they follow the news regularly, but 56 percent say that doing so causes them stress, according to the survey.

The new APA survey found that 59 percent of Americans "consider this the lowest point in U.S. history that they can remember"; APA pointed out that this negative mindset came from people who lived through World War II, Vietnam, the Cuban Missile Crisis and the 9/11 terrorist attacks.

“With 24-hour news networks and conversations with friends, family and other connections on social media, it’s hard to avoid the constant stream of stress around issues of national concern,” according to Arthur C. Evans Jr., PhD, APA’s CEO. “Understanding that we all still need to be informed about the news, it’s time to make it a priority to be thoughtful about how often and what type of media we consume.”

Trust in Media (?)

Although media itself is not in the top rank of personal stress factors, it is obviously the vehicle via which people learn about the problems that do unsettle them. "The medium is the message," as Marshall McLuhan intoned five decades ago.

APA said that the major stress inducers are health care, the economy, trust in government, hate crimes and general crime plus global war and terrorism. The recent APA report is loaded with other, fascinating demographic differences - e.g. women have significantly higher stress levels than men (5.1 vs 4.4 on a 10-point scale). The study did not explore whether such differences are affected by the amount of media consumption - a topic for further scholarly exploration, no doubt.

Amid all the analyses of Americans' stress situation is the more serious and expansive issue (which is being examined elsewhere): What are the political and societal implications of a devalued news industry? Is it a prelude to disbelieving everything? Beyond today's behaviors, such as only tuning in to the news sources that match your opinions, will future consumers choose to ignore it all?

If you're in or around the telecom/media biz, there's an extra stressor - depending on how close you are to the deals afoot. Friends and neighbors - "civilians" (or mere consumers) in the digital era - think you must know something about net neutrality, Disney-Fox, AT&T/Time Warner or any of the other landscape changers that have become part of the stressful media environment. Do you want to give them the right answer, presuming you KNOW the right answer? Or are you too consumed with the uncertainty of how these changes will affect your life. That is: more stress.

The NBC report included an APA checklist of things to do to reduce the media stress. It's a familiar roster ranging from avoiding social media, "no news before bedtime," and cold turkey (cut off completely). Although some viewers may adopt some of the recommendations, for people in the media/telecom industries, the options may take on a more ominous impact.

Stress will, in some yet-unknown ways, change the ways in which audiences actually consume what the industry wants to deliver. You can believe that - even if you see it on the "Interwebs."

Even as FCC nominees were pledging to speak out against attacks on journalists, President Donald Trump was continuing his verbal assault on the media, going so far as to offer a new "Fight Fake News" bumper sticker in exchange for a $1 donation to his joint (with the RNC) fundraising committee.

FCC Nominees Pledge to Speak Out Against Media Attacks

In an e-mail signed by the president and circulated Wednesday (July 19), Trump let fly with now familiar broad-brush attacks:

"Friend,

"I’ve said it before and I will say it again: the Fake News Media is the real opposition.

"Rather than working to fix the problems this nation is facing, the Fake News Media and the Left are hand-in-hand peddling supposed 'news' based on anonymous sources and an unbelievable lack of journalistic integrity.

"In fact, they’re so focused on bringing down the success of my administration -- that they’re forgetting about you, the American people.

"It is nothing but a 24/7 barrage of hit jobs, fake stories, and absolute disdain for everything we stand for as a movement.

"But Friend, I made a promise to stay focused on the American people.

"And I will not forget about you or that promise.

"This is a fight we can’t afford to lose. The future of our great country hangs in the balance. Stand with me in our fight against the FAKE NEWS with a contribution of $1 or more today."

Elsewhere in Washington, Democratic senators were calling on Republican leadership to hold a hearing on the state of the news media and attacks on journalists by the administration and others.

A Morning Consult/Politico poll finds that the morning news cycle has a majority or respondents feeling nervous about the future in the wake of the reports of various controversies surrounding the Trump administration, a perception held largely by Democrats.

The poll found that a majority of voters (55%, with a plus-or-minus two percentage point margin of error) say they feel nervous about the future. But that number is 83% for Democrats, compared with only 27% of Republicans.

On the angst meter, 62% of Democrats said they "experience anxiety" because of the president's controversies, while only 19% of Republicans say that is the case.

Respondents were split over whether the media were treating Trump fairly, with 43% saying yes and 42% saying no. But in terms of the political breakdown, that was like saying the average of one leg in the fire and the other in a bucket of ice is a pleasant temperature.

Three-quarters (75%) of Democrats said the media were being fair, while three-quarters of Republicans (76%) said they weren't.

Independents were actually split, with 37% saying the media was treating Trump fairly, but 40% saying they were not.

On March 31, the Federal Communications Commission (FCC) approved the latest in a string of proposed rulemakings, one which could have a significant impact on the business and operations of communications companies and edge players.

FCC chairman Tom Wheeler’s proposal to establish privacy rules for Internet service providers followed closely on the heels of the FCC’s proposal to “unlock” the cable set-top box (see "PwC’s 3things: Unlocking the Set-Top Box"). All of this comes a year after the controversial Open Internet Order (OIO), which reclassified broadband Internet access as a “telecommunication service” under Title II of the Communications Act, allowing the FCC to impose its “Open Internet” regulations.

While neither of the FCC’s two proposed rules are finalized – and the OIO is still being challenged in court – the fact is that the tide of regulatory-driven change is rising. Understanding and managing legislative and regulatory change is now a daily part of any business and has the attention of the highest levels of nearly every organization. Firms that have the ability to effectively manage – or even embrace – the impact of regulation can gain a competitive advantage.

Lessons Learned From the Wave of Dodd-Frank Regulation

Our experience with financial services firms addressing the rise of global financial reform regulation coming out of the financial crisis (e.g. the Dodd-Frank Act in the U.S.) found that the “winners” in the new regulatory environment were those firms that evolved their approach to proactively manage the impact of regulatory change. As Dodd-Frank’s proposed rules emerged, many banks took a combative stance and adopted a “wait and see” approach to preparing for the impact of the final rules. This approach left many unprepared and in a reactive mode when the rules were finalized. There was no time to think through the strategic or operational impact as they struggled to implement the required changes within the regulatory deadlines.

As banks later accepted the inevitable of the post-crisis regulatory environment and gained experience in addressing new and evolving regulations, a new model arose. Banks continued their lobbying efforts to shape proposed rules, but they also began to game plan the scenarios that might unfold.

Applying the Strategic Approach: The FCC’s Set-Top Box Proposal

The Dodd-Frank lessons learned from the financial services industry can be applied across most other industries facing regulatory-driven change. The FCC’s recent Set-Top Box proposal is a prime example. The FCC believes that the proposed rule meets their obligation under the Communications Act of 1996 to ensure a competitive market for navigation devices for live and video programming. Those opposing the proposal argue that it is unnecessary because the market is already innovating and providing customers with sufficient choices to access their content. The official 30-day comment period for the proposed rule will close on April 22, so, while late, there is still an opportunity to apply a proactive strategic approach (see graphic representation below) to address its potential impact.

At the most basic level, there are three potential outcomes for the proposed rule:

1. The rule is passed largely as proposed, so multichannel video programming distributors (MVPDs) would have to make the three information flows (Service Discovery, Entitlement and Content) available to third party navigation devices according to the rule’s requirements.
2. The rule passes but gets held up in court similar to the OIO, leaving the industry in a limbo state of regulatory uncertainty.
3. The rule does not pass, so the status quo remains.

MVPDs, technology and media companies should consider conducting an impact assessment based on each outcome. Many MVPDs are already innovating the ways in which consumers access their content through apps and other IP-based approaches or are working with third-party device companies to share content. They should be evaluating how their progress on this front could help them address some or all of the proposed rule’s requirements. At a minimum, this exercise would inform their response to, and formal comment on, the proposed rule. It may also provide them with insights that would allow them to benefit from any early adopter advantages.

With a proposed compliance date of two years after the final rule is approved, firms would have time to implement the types of strategic changes that this analysis might identify. The two-year window also makes it likely that the second scenario (legal challenge) would have little impact on a business’ strategy, other than providing an extended window for the more reactive firms to further delay potential changes to their strategy or business model. If the third scenario occurs and the rule does not pass, how would that impact the response of impacted firms? Most agree that the market for accessing video content is advancing rapidly with the evolution of Over-the-Top and digital offerings. With or without a final rule, firms will have to evolve and the analysis performed in preparing for the Set-top Box rule will help them formulate their evolution strategy.

In this era where change comes from all angles (including regulation) and disruption occurs at an accelerating pace, those firms that adopt a proactive approach and embrace regulatory-driven change can create a distinct competitive advantage.

David Sapin is Technology, Information, Communications and Entertainment (TICE) Risk & Regulatory Leader at PwC. Follow him on Twitter.

Charter Communications’ pending $77.7 billion purchase of Time Warner Cable isn’t expected to stop the flow of deals in both the distribution and content areas, experts at a Paley Center for Media event said.

“I think we’re on the verge of a significant uptick in activity,” said JP Morgan global chairman, Technology, Media & Telecommunication Investment Banking Jennifer Nason at the Paley Center for Media’s 2015 Paley International Council Summit here Thursday. “We are sort of in this disruptive vs. incumbent world in just about every industry you can think of and media is no exception. With OTT taking hold, ad models being disrupted, I think there is a lot of concern out there by all players, the established ones and the new ones, as to do I have the right assets in the right location, who are my competitors. I think when you go through periods where there is concern about what tomorrow will look like, there’s the overwhelming temptation to do deals to feel better about your position in the ecosystem.”

In the session moderated by Multichannel News/B&C editorial director Mark Robichaux, Waller Capital Partners chairman John Waller said he expects deals to move away from the typical large-company-buys-small-company scenario and instead focusing on adding new aspects to existing businesses in content, technology and distribution.

“Although some of the bigger companies will be involved, a lot of the deals will be in those three sectors,” Waller said. “It will be opportunistic buying, media companies buying digital media companies or ad tech companies, or cable companies buying fiber companies. It will be opportunistic mergers to make their business better.”

Waller added that while the climate today is different than the last big period of consolidation in the industry – the 1990s and early 2000s – the reason for deals isn’t that different

Back then, he said, the bet was on building a broadband business. And now that the infrastructure is built, the bet is the same but with a twist .

“The bet is still on broadband, but there is so much data consumption,” Waller said. “Cisco says 90% of data consumption comes through WiFi. That means you still need broadband pipe.”

Nason said that wireless, over the top and xx are attracting other players to the media business. And she said that more are likely to come.

“Traditional players have to find out how to evolve,” Nason said, adding that we will likely see some great and not so great deals in the future. She pointed to 21st Century Fox’s aborted attempt to buy Time Warner Inc. in 2014, which didn’t attract other bidders after their overtures were rejected.

“If Time Warner was to sell today, the people that would jump into that race would be very different today,” Nason said, adding that possible bidders could be consortiums of international buyers and big technology companies.

“A lot has changed in the last 12 months,” Nason said. “There is a different universe of competitors.”

Media veteran Jeff Sagansky is looking to raise $500 million through an initial public offering to amass the funds to buy his third media company in the past four years.

Sagansky recently filed documents with the Securities and Exchange Commission for an IPO for Double Eagle Acquisition Co., a so-called “blank check” company that will use the money to pursue a business combination with an unnamed media firm. Blank check companies typically have a certain amount of time to invest their capital – usually about 18 months. The value of the target company needs to be at least 80% of Double Eagle's cash, although the company intends to pursue larger transactions, perhaps in excess of $1.5 billion. The sponsor, investor and management team will own 20% of the company prior to the business combination. Double Eagle has 24 months to complete its business combination.

Deutsche Bank Securities and Bank of America Merrill Lynch acted as joint bookrunners for the offering, with Sterne Agee CRT and I-Bankers serving as co-managers.

Other cable executives have formed blank check companies in the past, including former Black Entertainment Television founder Robert Johnson, former ESPN chairman Herb Granath and  Communications Equity Associates founder J. Patrick “Rick” Michaels.

This is the third blank check company Sagansky has organized. In 2013 Sagansky and partners James Graf and Harry Sloan formed Silver Eagle Acquisition Co., a blank check entity that raised $325 million in an IPO. Silver Eagle completed its business combination in March 2015, when it purchased about 38.3% of Videocon d2h, a provider of direct-to-home pay TV service in India.

In 2011 Sagansky, Graf and Sloan formed Global Eagle Acquisition Co., raising $190 million through that blank check entity to acquire Row 44 Inc. and an 86% interest in Advanced Inflight Alliance. Those companies later combined in a deal valued at $430 million and changed its name to Global Eagle Entertainment. GEE is a provider of media content, connectivity systems and operational data solutions to the travel industry.

With his latest blank check company, Sagansky and company are issuing about 50 million shares at $10 each and are looking to acquire one or more companies involved in the media business, including content providers.

“We believe our management’s significant operating and deal-making experience and relationships with companies in this space will give us a number of competitive advantages and will present us with a substantial number of potential business combination targets,” Double Eagle said in its prospectus.

Aside from Sagansky, who as more than 25 years’ experience in the media business (he served as CEO of Paxson Communications, co-president of Sony Pictures Entertainment and president of CBS Entertainment), Graf has served as CFO of the Silver Eagle and Global Eagle and as  a consultant to Metro-Goldwyn-Mayer. Sloan, listed as a major founding investor, served as chairman and CEO of MGM from 2005 to 2009.

Convulsed by a virulent Digital Disruption, the Ecosystem is an ominous environment, and its inhabitants are afraid — very afraid.

No, that’s not the opening line of a creative pitch to studio Netflix for a binge-watchable original sci-fi series. As the tectonic shift to an Internet-centered, post-linear age in television advances, a real, truly anxious mood is settling over the pay TV ecosystem that media, communications and technology companies tensely cohabit.

Since the turn of the century, eight of every 10 homes has connected to the broadband Internet, enabling the disruptive rise of streaming video from pioneering Netflix and empowering a millennial vanguard of cord-shavers, cord-cutters and cord-nevers.

The uneasy mood began to really sharpen late last year, as the shift from linear TV produced a series of jarring developments on the regulatory front and in the mainstream attractiveness of OTT.

No ecosystem CEOs worth their $30 million-minimum pay will admit to it, but buffeted by change, some are feeling the chill of fear.

PLENTY TO FEAR

Not that fear isn’t rational, least of all to the lords of the digital jungle — cable operators. The Federal Communications Commission is on the verge of turning broadband into a regulated utility, a policy shift that President Obama urged in November. Alarmed by the possibility of becoming the first broadband-utility colossus, industry leader Comcast recently signaled it could walk away from a year-old, $45 billion proposal to absorb No. 2 Time Warner Cable.

In a report just last week, influential cable analyst Craig Moffett argued the FCC would use its new powers to regulate broadband pricing, crimping cable stocks.

In October, HBO went over-the-top. Pay television’s leading premium channel and change agent is aiming to reach the 10 million and rising broadband-only consumers who shun linear pay TV. CBS followed HBO’s lead a day later, introducing CBS All Access. Others have followed, and more are in the pipeline.

Then this seismic jolt in January: Disney’s ESPN, basic cable’s stickiest and most expensive network, joined the lineup of Sling TV, an upstart over-the-top offering from satellite TV provider Dish Network.

HBO and ESPN “are the two pillars of pay TV,” said Bob Bowman, CEO of Major League Baseball Advanced Media, which operates the pioneering subscription video-streaming service MLB.tv. “They have correctly determined that they need to explore options as we sit in a new world with a different generation.”

Might the ecosystem be witnessing the first meaningful sign that the cable bundle — a linchpin of television economics for two decades — is fraying? If cable’s two marquee networks are connecting directly to viewers over the Internet, Bowman said, “then I think every media company in the world has to do it.” Not everyone believes that would be positive for the ecosystem. Blared the headline on one analyst report: “An OTT Free-For-All Would Be a Mad, Mad, Mad World.”

Once the original disruptors, cable operators and programmers after two decades of booming stock growth are acutely experiencing the unsettling impact of digital disruption, a circumstance long and harshly familiar to print media and the music industry.

Indeed, every inhabitant of the television ecosystem — MVPDs, ISPs, OTTs, programmers, audience trackers, media conglomerates — sees something in this roiling period of change to fear.

There’s frothy uncertainty surrounding disruption in advertising, due to factors ranging from anachronistic audience-measurement tools to the fickle tastes of a demo whose biggest life decision at the moment is gum flavor. Even the tiniest misstep or unforeseen event can bring big peril.

A star can retire, robbing a programming giant of leverage needed in carriage talks. Think Viacom: It was already under a cloud over its programming prospects when Jon Stewart on Feb. 10 announced his leave-taking from Comedy Central’s The Daily Show With Jon Stewart sometime later this year.

For programmers, the shift to post-linear TV boils down to a stark choice: adapt or dwindle further faster. Fully-distributed networks are less fully-distributed already. As millennials cut cords to hopscotch among IP devices to watch video, cable operators are dropping lesser-watched channels. As a result, affiliate fees have slipped by a single-digit percent in two years, analysts estimate.

According to new Nielsen data, millennials are fleeing linear-TV during the current TV season at twice the pace of past years — dropping by 10.6 million from September 2014 to January.

“The change in behavior is stunning. The use of streaming and smartphones just year-on-year is double-digit increases,” Alan Wurtzel, NBCUniversal’s audience research chief, told The New York Post. “I’ve never seen that kind of change in behavior.”

Overall, primetime viewers have fled broadcast television for two straight years, down a total 12%, while cable lost 7% of its audience last year. In tandem, television advertising dropped. How much and when, if ever, will it fully recover? How much more of it will shift to IP devices? Which of their networks must content owners protect at all cost? Which are expendable? These are cold-sweat questions that content companies are asking now.

Worse, in this Golden Age of Television, programmers are drowning in quality programming, as content companies go all out to lure and retain audiences who now have a world of choices. Every network or website or movie service seems to own a tentpole series or two — the motion picture model leaping to television. Programmers may look forward to some expensive flops. (It is however, a good time for viewers, who can binge, time-shift or sprawl in front of linear TV.)

Meanwhile, competition is surfacing everywhere. Google, the gargantuan of online advertising, is installing Google Fiber, its own turbo-speed broadband service, in major cities, pressuring cable broadband to play catch-up. Now, with Verizon in its crosshairs, Google also is reportedly poised to introduce its own wireless service, leasing the networks of Verizon rivals Sprint and T-Mobile.

Google’s intent: To drive down data-plan pricing. Lower prices could spark a boom in data usage, gaining greater consumer exposure to ads on Google. Not only could pricing disruptions potentially harm Verizon’s core business. At the same time, Google’s move also may complicate Verizon’s strategy to dominate mobile video and wrest a chunk of the online ad market now dominated by the search giant.

“There’s a fear of the unknown,” said Edward Bleier, a senior industry consultant and the retired executive who ran the Warner Bros. pay TV division in the 1980s and 1990s. “No one can analyze the changing developments and feel fairly confident that they are right — the fear is not being sure you have the right take on what will happen.”

For years, digital disruption risks have been spelled out in clear language in many annual reports, including 21st Century Fox’s: Digital technology and “enhanced Internet capabilities and other new media may reduce television viewership, the demand for DVDs and Blu-rays and the desire to see motion pictures in theaters. Failure to effectively anticipate or adapt to emerging technologies or changes in consumer behavior could have an adverse effect on our business.”

Yet the company still hasn’t figured out how to extract full value from online viewing of the company’s content. “We’ve got to catch up … in our ability to figure how we monetize and capture the value inherit in that viewership,” 21st Century Fox chairman and CEO Rupert Murdoch acknowledged during last year’s third-quarter earnings call.

‘EVERYWHERE’ GETS NOWHERE

History shows that incumbents really don’t react to disruptive products and services until it’s too late. That’s because either the market is too small or there’s a risk of cannibalizing one’s own business.

Liberty Media chairman John Malone, one of cable’s most seasoned and successful investors, has subtly chastised U.S. cable operators and programmers for not getting TV Everywhere together fast enough. “The cable industry has been very slow [which has] created a window of opportunity to the over the top guys,” he told Reuters, referring to Internet-delivered TV services such as Netflix.

Bolstering the point in an earnings call last week with analysts, Discovery Communications CEO David Zaslav warned that further delay of TV Everywhere by cable would force programmers to go OTT. “It will require all of us to go directly to the consumer, because the cable guys aren’t getting it done,” he said.

In addresses to investment analysts, Time Warner CEO Jeff Bewkes has cited a tendency by media executives to avoid being a first mover because of the risk of embarrassment. In contrast, he explained, Time Warner has moved decisively to exploit its content inside the ecosystem (on pay TV and as a supplier to broadcasters) and outside (over the Internet).

“The more options you give audiences to access video content, the greater the consumption,” Bewkes told one Wall Street gathering. “Rather than merely shifting share from one platform to another, we continue to see growth in the video universe, and that’s why we’re convinced we can effectively pursue growth in both areas.”

Time Warner’s Bewkes knows a thing or two about digital disruption and may be one of the ecosystem’s braver CEOs, having survived the corporate near-death experience of the Time Warner- AOL combination.

At Disney, fear of the consequences of inaction spurred the company to be a first mover in embracing Internet video. Also credit Disney chairman and CEO Robert Iger, who forged close ties with the late Steve Jobs of Apple. Jobs was Disney’s largest single shareholder as a result of selling Pixar Animation to the media giant. Talk about a model relationship. Together, Iger and Jobs virtually jump-started the 2.0 digital revolution by jointly introducing Apple’s paradigm-shifting video iPod with $1.99 Disney-owned TV hits at iTunes. Iger’s peers privately scoffed and accused him of harming television revenue streams.

It shouldn’t be surprising that TV executives would scoff at the notion that they are fearful, particularly based on the last few years of stock performance. And gauging the true mood of an industry at its inflection point is tricky business. In the mid-1990s, who knew DVDs would supplant videocassettes, ushering in an unprecedented period of bottom-line enrichment and value-creation in Hollywood? But divided into warring format factions, Hollywood certainly wasn’t initially in the buoyant mood that prevailed when the DVD gusher materialized.

In 2000, major music labels did recognize the existential threat of Napster. Still, it was too late to gain command of the disruptive forces Napster unleashed, and the music industry will never be the same. Then there’s the risk of misinterpreting a true shift. When AOL acquired Time Warner in 2000, the combination was hailed as fully realized convergence. In truth, the monumentally ill-fated transaction marked the bust of Internet 1.0.

If any player recognizes a tectonic shift, it’s HBO. Expanding the premium channel’s audience beyond cable “is the most exciting inflection point in HBO history,” CEO Richard Plepler declared in announcing cable-untethered HBO. “Just the threat of going over-the-top gives us additional leverage.”

How might streaming HBO impact Comcast, Verizon, DirecTV and the rest of the herd of pay TV giants? A recent Parks Associates survey found that 17% of U.S. households likely would subscribe to the standalone streaming network. Of the respondents planning to subscribe, half indicated they would drop pay TV for HBO over-the-top.

The mood of pay TV and broadcast executives would brighten considerably with audience-tracking tools suited to post-linear TV. If there’s one consensus in the ecosystem, it is that viewership isn’t measured across the universe of platforms and digital devices. The vast majority of the missing viewers are apparently millennials.

Not surprisingly, Nielsen, the dominant TV ratings service, catches plenty of flack. The ecosystem took note in January when CNBC suddenly dumped Nielsen and hired a little-known obscure market researcher, Cogent Reports, to track its daytime audiences.

“If you counted all the viewing that we know that’s not counted the traditional way” by Nielsen for The CW network, “it’s up 10%” from reported ratings, Bewkes of Time Warner, part owner of the network, recently told Wall Street analysts. Alluding to time-shifted viewing and OTT audiences, CBS CEO Leslie Moonves (the other part owner of The CW) has declared Nielsen’s overnight ratings as “basically worthless.”

But broader, more-accurate audience tracking won’t necessarily restore confidence. In fact, media executives will face decisions fraught with risk of economic miscalculation. Should they charge advertisers more to reach young-skewing mobile and digital-device audiences, a coveted demo whose preferred platforms are more dynamic? Would advertisers, in turn, give a haircut to ad rates for older-skewing linear-TV audiences? Or should the various ratings be rolled into one, with advertising rates reflecting the quality of the overall audience?

It’s an “issue that realistically we are very much in the midst of evaluating and analyzing,” 21st Century Fox chief operating officer Chase Carey said on a recent quarterly earnings call with analysts.

THINKING AHEAD

With indications that the cable bundle could come under greater pressure, media companies must swiftly begin contingency planning. For two decades now, pay TV has expanded its bundles and justified annual rate hikes of 4% to 5% by citing the surging number of channels. Per Nielsen, the average pay TV household has 190 channels, only 14, 15 or 17 of which are watched regularly in any given home. Meanwhile, the average monthly cable bill of about $64.41 a month, according to the FCC, is triple the amount of two decades ago, when the agency began tracking the rates. Pay TV distributors have responded with slimmed-down bundles, but so far that hasn’t been enough to staunch subscriber declines.

Consumer choice, made possible by technology, is fueling the rapid changes in the environment. Pay TV operators are certain to be more concerned over consumers’ growing appetite for a la carte channels, from which consumers could cobble their own personalized bundles. Some 41% of respondents surveyed recently by PricewaterhouseCoopers said they’d prefer the option. Given the growing number of OTT choices, personalized a la carte bundles seem to be a phenomenon on the near horizon.

In the end, though, Darwinism doesn’t seem to apply to television’s evolution. Broadcast, thought surely to be left for dead as cable emerged, has continued to thrive alongside cable, which has remained dominant next to satellite-TV, which has remained aloft since households began to plug into telecom television. (Q: What’s the state flower of West Virginia? A: Satellite dish)

For now and the foreseeable future, television will continue to thrive on the incumbent economic model of ads, retransmission fees and sizeable slices of the nation’s monthly cable subscription. Even as old-school executives like Bewkes of Time Warner and Moonves of CBS move first to embrace OTT, they remain among the most ardent defenders of the status quo.

But in repositioning their companies, and becoming examples to other cohabitants of the ecosystem, they are wisely fearful enough.

Despite Time Warner's high profile rejection of 21st Century Fox's recent takeover advances, major media companies are shifting their focus from cost cutting to growth initiatives in the digital space, including mergers and acquisitions, according to a recent report.

According to a survey of chief financial officers at 50 top media companies like Time Warner, Univision and Fox by accounting giant Ernst & Young -- It’s Showtime! Digital drives the agenda, data delivers the insights -- CFOs are no longer worried about the global recession and are well-positioned to grow their companies through capitalizing on digital opportunities and through investments in technology, digital talent and infrastructure, as well as acquisitions and other deals. Only 26% of senior executives surveyed said global economic uncertainty would be a challenge during the next three years, compared to 62% two years ago, showing a dramatic decrease in concern over the economy.

“The CFOs told us in no uncertain terms that the economy is no longer an obstacle and now is the time for media and entertainment companies to invest in growth and focus on building their businesses," said Ernst & Young Global Media & Entertainment Leader John Nendick in a statement. "The industry is now poised to deliver on the promises it has been making the past several years but has been unable to achieve because of the economy. The CFOs recognize the recession is over and it’s showtime.”

But despite renewed optimism about the overall economy, the CFO's still see challenges ahead, according to the report. Among the greatest obstacles over the next three years: technology and platform disintermediation (64%), and an inability to persuade consumers to pay fair value for content (58%). Still others identified structural and regulatory uncertainty (42%) and reductions/reallocations of marketing budgets (26%) as major challenges for the future.

CFOs also are are placing significant emphasis on data to improve decision-making, systems and processes -- 59% of CFOs feel their companies successfully use data to respond to and upsell existing customers, but  only 33% said their companies do a good job of using data to generate new business. And while only 39% of CFOs believe their organization is good at sharing data, 58% indicated that sharing data between business units would improve their organization’s overall effectiveness.

Other key findings in the study include:

• About 74% said their top priorities are the evolution of digital and online distribution, followed by cost reduction and business efficiencies (34%), creatively differentiating content (32%), extending brands globally (32%) and growth in new market segments (30%)
• Emerging markets are no longer the top geographic focus for growth; 72% of M&E companies indicated their focus is on existing/core markets.
• About 72% said interactive media businesses were the best positioned to evolve and thrive in the future, followed by cable television networks and channels (42%), conglomerates (36%), film and television production (30%) and content and information services (30%).
• The top actions identified to make companies more effective are attracting/retaining talent (58%), improved IT capabilities (42%), deeper understanding of market trends, customers and competitors (38%) and getting new products to market faster (30%).
• CFOs prefer deals that give them either complete or majority ownership (61%) instead of making investments or having a minority interest (34%).
• The average deal value during the first half of 2014 was $939 million, compared with $220 million in 2013 and $157 million in 2012, with cable operators driving the rise.

“Recruiting and retaining talent is a significant concern for almost every CFO we surveyed, said EY’s Global Media & Entertainment Advisory Services Leader Howard Bass on a statement. "All agreed that talent, as well as establishing better collaboration between teams and different business units, are the most important factors for efficiently running their companies. The right talent means finding people who have the technical skills but are also digital savvy.”