Scoop: Apollo Global, which is considering a bid for Disney’s 22 regional sports networks, has held early talks with LeBron James’ media company.

November 8, 2018 | Hollywood

Good morning. Today's Market features a fresh scoop on LeBron James and the 22 regional sports networks that Disney has put up for sale... plus, Google's New York expansion and Vice's cuts ... 
The Big Distraction: Trump vs. Acosta — President Donald Trump’s decision to suspend White House press credentials for CNN’s Jim Acosta last night set the D.C. press corps aflame and raised alarm among progressives. Politically, it was as brazen as it was strategic:

• It distracted from the major stories of the day, which included a Democratic takeover of the House, talk of impending congressional investigations and the resignation of Attorney General Jeff Sessions.

• It reinforced Red State America’s perception that CNN is anti-Trump and hell-bent on destroying his reputation, and that reporters are more obsessed with their own problems than those of the American people.

• It forced the rest of the media to align itself with CNN — a foil to the Trump administration in America's culture wars — because the action against Acosta was so extreme that reporters had no choice but to defend him.

The Big Picture: President Trump is playing off two Americas. In one America, the blacklisting of Acosta is an unwarranted affront to the freedom of the press. In the other, it is justified retribution for a petulant, self-obsessed reporter who is obviously biased against Trump and openly hostile to his White House.

President Trump lost the first America long ago, before he was even elected. His battle is for the hearts and minds of his base. And in that effort, he couldn't have chosen a more vulnerable adversary.

As The Atlantic's Todd Purdum wrote earlier this year, Acosta "blurs the line between reporting and performance, between work and war, at a time when journalists have a greater obligation than ever to demonstrate that what they do is real, and matters—and is not just part of the passing show."

Ok, enough politics. Let's get down to business ...

Scoop: Apollo courts LeBron — Apollo Global, one of several private-equity firms considering a bid for Disney's 22 regional sports networks, has held early talks with LeBron James' media company, Uninterrupted, about bringing them on as a strategic partner, according to sources with knowledge of the talks who were not authorized to speak publicly.


• The 22 regional sports networks, which Disney must sell in order to acquire 21st Century Fox, include channels in Los Angeles and New York.


• Several potential buyers have expressed interest, including Apollo, Blackstone Group, KKR, Providence, Silver Lake and Endeavor, and Lachlan Murdoch's "New Fox," which owns Fox Sports and Fox Broadcasting.


• Apollo's talks with James' multimedia platform have focused on a strategic partnership deal that could see James contributing and advising on content for the networks, the sources said. There has been no talk of an ownership stake for James' company.


The Big Picture: The 22 RSNs are highly coveted properties at a time when sports and live events are the coin of the realm for linear television. The question is what to do with those networks when the games aren't on. The talks with Uninterrupted point to a possible solution.


Hard Times: Nancy Dubuc's Vice to Shrink as Growth Stalls — "Vice Media plans to shrink its workforce by as much as 15% through attrition and cut its selection of digital sites by at least half," the Wall Street Journal reports:


• "Revenue ... is expected to be roughly flat this year ... coming in between $600 and $650 million. ... That number is more than $100 million below the projection Vice offered private-equity firm TPG in the summer of 2017."


• "Vice lost more than $100 million in 2017 and is on track to lose more than $50 million this year."


• "Dubuc issued a companywide hiring freeze about six weeks ago ... [and] plans to slim down Vice’s ranks by between 10% and 15% overall."


The Big Picture: Dubuc wants Vice to focus on areas of growth, which include its in-house advertising unit and the content it creates for third parties. As WSJ notes, the plan "essentially shifts Vice’s emphasis away from the kind of online content that originally put it on the map for young users."


Throwback Thursday: At last week's Dealbook conference in New York, Dubuc acknowledged that there was “duplication” among employees that could lead to staff cuts. She also said Vice could be profitable "within a fiscal year."


Market Links


  • Reed Hastings sets his sights on India (CNBC)


  • David Zaslav's stock hits a 52-week high (THR)


  • Elon Musk gets replaced as Tesla chairman (WSJ)


Moving the Market: Silicon Alley Expands — While Jeff Bezos closes in on Long Island City, Larry Page and Sundar Pichai are eyeing a major expansion of their footprint on Manhattan's West Side, per NYT's Daisuke Wakabayashi:


• "Google is in discussions to move into a planned 1.3 million square foot office complex at the St. John’s Terminal building on Manhattan’s West Side, according to a person with knowledge of the company’s plans..."


• "The property, which is expected to be completed in 2022, would allow the internet giant to significantly increase its presence in the city. Google employs around 7,000 in New York, and a space that size could allow it to more than double its local work force."


The Big Picture: "New York and Washington are leaving the rest of the country behind," The Upshot's Emily Badger writes: "A small number of rich and internationally connected cities keep increasing their economic advantages — and as a result, the inequality widens between them and everywhere else."

Hindsight 20/18: Zuckerberg Avoids Spotlight — Two years after Facebook's catastrophic failure to address Russian interference on its platform, Mark Zuckerberg & Co. did a good enough job of battling misinformation on election night — which, relatively speaking, is a major victory for a social network that is constantly bedeviled by controversy.

The 48 hours leading up to Tuesday night's returns provide a perfect picture of Facebook's progress, as well as its enduring challenges:

• Facebook cybersecurity chief Nathaniel Gleicher said the company was informed by the FBI on Sunday night about activity linked to foreign entities.

• By Monday, Facebook had identified more than 100 Facebook and Instagram accounts possibly engaged in "coordinated inauthentic behavior" and blocked the accounts immediately.

• On Tuesday, hours after most polls closed, Gleicher announced that a website claiming association with the Kremlin-backed Internet Research Agency had taken responsibility for some of the Instagram accounts -- as well as others that Facebook hadn't identified.

The Big Picture, via Gleicher: "This is a timely reminder that these bad actors won't give up — and why it's so important we work with the US government and other technology companies to stay ahead."

In other words, it's a game of whack-a-mole. And no matter how good you get at whack-a-mole, there are always more moles.

Meanwhile ... Zuckerberg has rejected a request from at least five countries to appear before an international committee and give evidence on fake news.

What's next? Google's Sundar Pichai tells NYT's David Gelles that "technology doesn’t solve humanity’s problems. It was always naïve to think so. Technology is an enabler, but humanity has to deal with humanity’s problems."


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