The global elite that have gathered in Davos this week are keenly aware of the forthcoming effects of climate change and bracing for major impacts on their businesses — as well as new revenue opportunities that may emerge from global warming.

January 23, 2019 | Hollywood


Good morning. Highlights from Davos: John Kerry called on President Trump to resign ... Secretary of State Mike Pompeo defended "disruptive politics" ... and Google CFO Ruth Porat sought to reframe the debate over big tech's access to your data.


"Data is more like sunlight than oil," Porat said. "It is like sunshine — we keep using it, and it keeps regenerating."


Fabrice Coffrini/Getty

How Davos sees climate change


Big in Graubünden: The global elite that have gathered in Davos this week are keenly aware of the forthcoming effects of climate change and bracing for major impacts on their businesses — as well as new revenue opportunities that may emerge from global warming.


The Big Picture: While our national debate around climate change is mired in science vs. denial, the business community — including tech, media and telecom — has accepted the science and is preparing for new realities.


The Latest: Bloomberg's Christopher Flavelle has obtained the disclosures that major U.S. companies submitted to the Carbon Disclosure Project regarding "the risks and opportunities" for their businesses:


• "Bank of America worries flooded homeowners will default on mortgages."


• "Disney is concerned its theme parks will get too hot for vacationers."


• "AT&T fears hurricanes and wildfires may knock out its cell towers."


• "Coca-Cola wonders if there will still be enough water to make Coke."


Intel says droughts could “potentially lead to increased operational costs."


Visa warns that "global pandemics and armed conflict" could affect travel.


Apple predicts more disasters "will make iPhones even more vital."


Merck sees "expanded markets for products for tropical and weather related diseases."


Take It To Heart: "The information companies provide [to CDP] is typically far more specific than what they include in their filings to the U.S. Securities and Exchange Commission," according to Flavelle.


Climate highlights from Davos:


• Sir David Attenborough told Prince William, “We are destroying the natural world, and with it ourselves.”


• Jacinda Ardern, the New Zealand Prime Minister, told Al Gore that world leaders need to get on the right side of history.


• Lord Nicholas Stern  said "the ravages of climate change are becoming clearer and clearer and time is running out."


How It's Playing, via France 24:


• "Never mind climate change, Davos prefers private jets."


Carsten Koall/Getty

Sundar Pichai eyes EU exit


Google is threatening to pull Google News out of Europe in response to regulators' plans to implement a controversial copyright law, a move that is likely to further sour relations between Google parent company Alphabet and the European Union.


The Details, via Bloomberg's Natalia Drozdiak:


• "The European Union’s [law] will give publishers the right to demand money from [Google], Facebook and other web platforms when fragments of their articles show up in news search results, or are shared by users."


• Google public policy manager Jennifer Bernal says Google News might "quit the continent" in response to the directive.


How It's Playing:


• European media analyst François Godard: "I don’t buy the threat — they really need Europe."


The Big Picture: Relations between Alphabet and the European Union are at an all-time low after French regulators moved yesterday to fine Google nearly $57 million for failing to disclose to users how it collects and uses their personal information.

🎧 Rally the Market 🎧


Rally the Market: The Economist is launching a daily podcast later this month called “The Intelligence," which will offer new perspectives on "the events and trends that are shaping the world." First episode January 29.


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What Bobby Kotick saw


What's Next: The video game industry is overtaking the film, television and music industries in annual revenue as games like Fortnite, League of Legends and Call of Duty gain widespread popularity, shifting priorities for technology and media companies in Silicon Valley and Hollywood.


The Key Stat: $43.4 billion.


• That's the revenue the U.S. video game industry generated in 2018, according to new data from the Entertainment Software Association.


• It's also the revenue the U.S. film industry generated one year earlier, according to a recent IBISWorld study.


The big difference: The video game industry is growing by 18% annually, whereas the film industry is growing by just 2.2%.


Driving the Growth:


• More than 82% of last year's revenue was driven by software sales, including in-game purchases and subscriptions.


• Mat Piscatella, analyst at NPD Group, emails: "The emergence of the cultural force that is Fortnite was a significant driver of the overall success of the video game industry in 2018."


• The industry has also been buoyed by the rise of eSports. In the last month, people spent 125 million hours watching other people play Fortnite on Twitch, the live streaming video platform.


The Big Picture, via the ESA: "There are 150 million Americans who play video games, making the U.S. video game industry one of the nation’s fastest growing economic sectors."


And yet ... Despite its widespread consumer base, the industry has been woefully under-covered on a day-to-day basis because it lacks the history, drama and egos associated with traditional media and entertainment industries. That will have to change.

Market Links


Andy Stenzler seeks VC funding for Rumble (Bloomberg)


Jimmy Pitaro sees promise in the UFC (SportsTechie)


Lacob & Guber's Chase Center nears completion (SFBT)


David Glasser hangs a $300-million shingle (Variety)


Jim Bankoff's Vox Media acquires Coral Project (Axios)


Craig Barritt/Getty

Bob Bakish lands on Pluto


What's Next: Viacom has acquired the streaming service Pluto TV for $340 million, giving chief executive Bob Bakish a small but significant stake in Hollywood's highly competitive streaming wars.


• PlutoTV is an ad-supported streaming service based in Los Angeles and has about 12 million active viewers a month.


The Big Picture, via NYT's Ed Lee: "This is Viacom’s most significant move into streaming, now the go-to strategy for media companies as more and more viewers forgo traditional cable subscriptions."


• "Bakish has been working on an extended turnaround of the ailing media company, which counts MTV, Nickelodeon and the Paramount film studios in its portfolio. The cable networks have faltered as younger audiences have turned to platforms like YouTube and Facebook."


Sylvaine Lefevre/Getty

Reed Hastings goes Hollywood


Fresh off the heels of a record 15 Oscars nominations, Netflix is joining the Motion Picture Association of America, marking the first time in Hollywood's history that a non-Hollywood studio has joined the movie industry's trade group.


• Netflix joins Hollywood's "Big Six" — Disney, Universal, Paramount, Sony, Warner Bros and Fox — but will actually replace Fox as the sixth member when the latter is acquired by Disney.


The Big Picture, via Bloomberg's Lucas Shaw: "Netflix got the second most Oscar nominations of any studio in the same year it got the most Emmy nominations of any TV network. It also just joined Hollywood's top lobbying outfit. Think we can stop talking about Netflix as an outsider."


And yet ... across town, AMC Theatres and Regal Cinemas are refusing to air the Oscar-nominated "Roma" because it did not have a traditional, 90-day theatrical release.


Bonus: The Oscars nomination scorecard:


• Disney: 17


• Participant Media: 17


• Fox Searchlight: 15


• Netflix: 15


Of course, after the Disney-Fox acquisition that's Disney 32.

What's Next: Started from the bottom now Drake is making $2 million per show in Las Vegas. Vulture's Harley Brown explains why his residency there could change the game for entertainment in Sin City.


See you tomorrow.


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