Hollywood Reporter: Billionaire Investor John Malone Rings the Alarm About Big Tech’s Entrance Into Sports

Story from Hollywood Reporter:

Liberty Global chairman John Malone said he was “ringing the alarm” on big tech’s entrance into the media ecosystem, saying they will “erode” the broadcast industry.

Speaking at the Paley International Council Summit in Manhattan Wednesday, Malone, a billionaire investor, pointed to Amazon’s purchase of Thursday Night Football as an example of an “upside down regulatory world,” which he said allows tech platforms like Amazon, who have deep pockets and don’t have to pay transport costs, to easily outbid traditional cable companies. This could eventually “destroy” localism in television news and sports, he said, while urging the broadcast industry to speak up and fight back against regulations that allow the big tech entrance into the space.

“I believe that network neutrality needs to be challenged by the broadcast industry,” Malone said.

He added that he believes big tech companies “would’ve swallowed old media” already, if antitrust regulators would allow it.

On the pure streaming side, Malone said he believes there will be greater consolidation among the platforms, saying that the “llibrary-like services” will “sort themselves out and come down to a handful of successful enterprises.”

When asked by Library Global CEO Mike Fries in the lightning round whether there would be a merger of two big legacy media companies in 2024, Malone said yes, and predicted that Paramount would be one of them.

Overall, Malone said he expects to see more deals like the one struck between Charter and Disney, which offered some of Disney’s streaming service in its cable TV bundle. This deal took away “the risk that everything gets blown up all at once,” he said, referring to the decline of linear television and the still costly transition into streaming.

“All media better figure out how to get together with old distribution and save each other’s ass or they’re all going to be in the frying pan,” Malone said.

As for Disney’s plan to buy out Comcast’s stake in Hulu, Malone said he believed Disney had to do that in order to fulfill their streaming goals. Comcast, meanwhile, has the best balance sheet of legacy media companies, he said, and he views their sale of Hulu as “building up dry powder” so that the company can purchase other media assets when they become distressed.

Malone, who is a shareholder in Warner Bros. Discovery, added that he believes CEO David Zaslav is doing a “great job” deleveraging the business.

“I think he’s doing the number one thing he needs to be doing,” Malone said.

He added that he believed the 16 percent stock drop Wednesday, following the company’s third-quarter earnings report in which the company reported a $111 million streaming profit, came as investors looked at the poor advertising results and management said weakness in the ad market may continue into the next year. Malone said that he was not sure whether these issues were due to overall softness in the advertising market or part of the transition period from linear to advanced ads on platforms such as Amazon and Meta.