Trump’s peace plan is a path to freedom and stability for the strip’s oppressed residents.
Moumen Al-Natour
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Gerry Baker is Editor at Large of The Wall Street Journal. His weekly column for the editorial page, “Free Expression,” appears in The Wall Street Journal each Tuesday. Mr. Baker is also host of “WSJ at Large with Gerry Baker,” a weekly news and current affairs interview show on the Fox Business Network, and the weekly WSJ Opinion podcast “Free Expression” where he speaks with some of the world’s leading writers, influencers and thinkers about a variety of subjects.
Mr. Baker previously served as Editor in Chief of The Wall Street Journal and Dow Jones from 2013-2018. Prior to that, Mr. Baker was Deputy Editor in Chief of The Wall Street Journal from 2009-2013. He has been a journalist for more than 30 years, writing and broadcasting for some of the world’s most famous news organizations, including his tenure at The Financial Times, The Times of London, and The BBC.
He was educated at Corpus Christi College, Oxford University, where he graduated in 1983 with a 1st Class Honors Degree in Philosophy, Politics and Economics.
Gerard Baker
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LONDON—Sarah Mullally was named as the next Archbishop of Canterbury, the spiritual head of the Anglican Church, on Friday, making her its first female leader in its nearly 500-year history. She replaces Justin Welby, who stepped down last year after a report concluded he didn’t do enough to bring a child abuser to justice.
The 63-year-old is a former cancer nurse who joined the Anglican Church as a priest in 2001. In 2018, she became bishop of London, which is the third-highest role in the Church of England, becoming the first woman to hold such a senior role. Women were first ordained Anglican priests in England in 1994, and the first female bishop appointments followed in 2014. Mullally had previously served as the U.K. government’s chief nursing officer, advising the government on nursing matters. She says she became a Christian aged 16. She is married with two children.
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Max Colchester
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I have a few questions for the foreign governments that approved “ A Palestinian State for Hamas” (Review & Outlook, Sept. 23). What is its capital city? Can Christians and Jews freely practice their religion there? Can women divorce, own property, vote, run for office, get abortions? Will elections be regularly held? Will gay marriage be allowed? Finally, do all citizens of the “state” have the right to kidnap, rape, torture and murder Jews?
The Jewish people are celebrating the New Year of 5786—many of them, living in the state their foes want to wipe off the map. Meanwhile, Hamas refuses to release hostages kidnapped almost two years ago. Useful idiots in the U.K., Australia, France and elsewhere reward them for their intransigence. Recognition of this supposed state is an affront to decency, morality and common sense.
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Former President Donald Trump on Friday criticized Federal Reserve Chair Jerome Powell and said he’s playing politics with interest-rate policy.
“It looks to me like he’s trying to lower interest rates for the sake of maybe getting people elected,” Trump said, in an interview on the Fox Business Network.
“I think he’s political,” added Trump, the likely 2024 Republican nominee for president.
Asked if he would reappoint Powell to a third four-year term, Trump replied “no.”
Trump said he has a couple of choices in mind to replace Powell, but wouldn’t say who.
Trump said he thinks lowering interest rates would lead to massive inflation. The conflict in the Middle East is likely to lead to “big inflation” from a spike in oil prices, he added.
“Trump said he thinks lowering interest rates would lead to massive inflation. The conflict in the Middle East is likely to lead to “big inflation” from a spike in oil prices, he added.”
Powell “is not going to be able to do anything,” Trump said.
On Wednesday, Powell said he wasn’t giving a potential third term any thought. Powell’s current term expires in early 2026.
Speculation on a third term “is not something I’m focused on,” Powell said.
“We’re focused on doing our jobs. This year is going to be a highly consequential year for the Fed and monetary policy. We’re, all of us, very buckled down, focused on doing our jobs,” Powell said.
Analysts say that the Fed will be criticized by both parties in the election year.
On Sunday, Powell will appear on the CBS News program “60 Minutes” and will likely face more questions about the election.
Earlier this week, top Democrats on the Senate Banking Committee urged the Fed to cut rates quickly, saying they were too high and hurting the housing market.
“Keeping interest rates high will be detrimental to American workers and their families and do little to bring down prices or promote moderate economic growth,” said Sen. Sherrod Brown, a Democrat from Ohio, and the chairman of the Banking Committee, in a letter to Powell prior to Wednesday’s Fed meeting.
At the meeting on Wednesday, the Fed kept its benchmark interest rate unchanged in a range of 5.25%-5.5%.
Asked about the letter from the Democrats on Wednesday, Powell said Congress has given the Fed the job of stable prices. High inflation hurts people at the lower end of the income spectrum, he added.
“It’s what society has asked us to do is to get inflation down. The tools we use to do it are interest rates,” he said.
The Fed has penciled in three rate cuts for 2024. Powell said that a cut at the Fed’s next meeting in March was unlikely. He said the Fed wants to see more good inflation reports so it can have greater confidence that inflation is coming down to the 2% target.
When Ann Shea, 44, was finalizing a divorce last year, she knew she wanted to keep the suburban Chicago home where she was raising her school-age kids. But it was equally important for her to hold onto her relatively low mortgage rate.
She had purchased the home in the summer of 2012, and had refinanced to a rate of 2.8% during the pandemic. She wanted to keep the house to provide stability for her kids, who were still young and attending school nearby.
But to get the mortgage and the title of the home in her name only would have required refinancing, which would have bumped up her mortgage rate to the 6% range, where rates were averaging in mid-April when her divorce was finalized. A back-of-the-envelope math estimate would suggest that her monthly mortgage payment could have ballooned by 33%.
“The divorce was so expensive, and to think about adding on that cost would have been terrible,” Shea, a compliance attorney, told MarketWatch.
Moving to such a comparatively high mortgage rate after 11 years of paying off the 2.8% loan would have felt to Shea like she had “lost all that ground,” she added.
Shea’s plight is becoming more common. As mortgage rates soared from historic lows during the pandemic to two-decade highs at the end of 2023, homeowners with rates under 3% became the envy of their friends and family. But when a marriage splits up, the question of who walks away with the lower mortgage rate sparks far more than casual jealousy.
It’s increasingly a source of tension at the divorce negotiating table, Alla Roytberg, a New York City-based family and matrimonial law attorney and a mediator, told MarketWatch.
“In the past, when rates were low, it was an easy answer, because somebody could refinance and get a 3.5% rate,” Royberg, who has been in matrimonial law for the last three decades, said. “And now, they have this 3% rate, and if they refinance, they’re going to get 7% or 6% — and that makes it unaffordable.”
Historically, a couple who is going through a divorce will either work out an arrangement to refinance the home and put it in one spouse’s name, or if the divorce is acrimonious, they can be forced by a court to sell the home and divide the proceeds, Erin Levine, co-founder of Hello Divorce, a company based in Alameda, Calif., that sells online divorce services, told MarketWatch.
Levine is a family law attorney licensed in California, and has helped more than 5,000 individuals through the legal process of divorce. Hello Divorce recently beefed up its real-estate arm, because it’s seen a surge in interest in home-owning couples interested in divorce.
Those traditional methods are still an option separating partners pursue today. But the large gap between prevailing mortgage rates and the rates on divorcing couples’ homes, coupled with a more expensive housing market, has prompted some to turn to unconventional strategies to divide real-estate assets. They can include deciding to co-own a property together or agreeing to stay in the same house for a certain number of years.
“People are trying to figure out ways to work things out of court,” Levine said.
The financial motivation is strong, too. “We have to come up with creative options over how to handle those kinds of cases,” added Roytberg. “Some of them are barely able to find the budget that they were living with. How do you add another three, four thousand dollars in rent, when the money isn’t there?”
Some couples are finding innovative solutions — from sale leasebacks to mortgage assumptions — to hang on to their prized ultra-low rate. Others are resorting to less sustainable stopgap measures.
Here are some of the scenarios couples are turning to:
One strategy is to “buy time,” Levine said.
In this scenario, the couple finalizes their divorce, but continues to co-own the home while waiting for rates to fall. Either they stay together in the house, or one spouse moves out, but they both continue to own the home together to avoid refinancing.
About a tenth of the divorcees on Levine’s platform are saying, “‘I really want to stay in the house, I can’t afford these mortgage rates, and I don’t know what the market’s gonna look like, so give me two years,’” Levine said. “And with you staying on the mortgage, in exchange, I’ll pay you some money.”
Some arrangements include a higher-earning spouse paying the mortgage in place of spousal support, and then deducting it from their taxes, Roytberg explained. “It helps both sides,” she said, “because they don’t need to refinance at a higher rate for the other, and [the higher-income spouse] could directly pay the mortgage instead of spousal support.”
The so-called lock-in effect — which refers to high mortgage rates forcing homeowners to stay put in homes with lower rates — has most homeowners frozen in place for the time being. Few are willing to give up their home and their low mortgage rate and move to a house that costs more, and requires a mortgage with significantly higher borrowing costs. That’s also led to a squeeze on resale inventory, which is hurting aspiring homeowners.
But with rates staying below 7% since mid-December, there are some early signs that the housing market is coming back to life.
“Buyers and sellers are learning to live with uncertainty,” Shay Stein, a Las Vegas-based real-estate agent with Redfin
RDFN,
said in a recent report. “They’ve realized no one has a crystal ball that can predict exactly when mortgage rates will fall back to 5%, so they’re making moves now,” she added, “because they can only wait so long to be near their grandkids, live in an RV like they’ve always dreamt of, or finalize their divorce.”
But some divorcees are not as keen, opting to wait and see.
“I had one [divorcee] that had decided that he was just gonna live in the basement, so good luck with that,” Jae Tolliver, an Ohio-based mortgage broker with Union Home Mortgage, told MarketWatch, referring to someone who wanted to continue to live in their existing house, even though they had split from their spouse. “People are definitely trying to get more creative.”
Tolliver recently quipped on social media that couples are staying together not for the kids’ sake these days, but rather for their low mortgage rate.
He also described another client who decided to stay in the house with their ex-spouse after the divorce, and continue to pay the mortgage payments like before just to keep the low rate.
But “it wasn’t working out so great,” Tolliver said. “Because at the end of the day, you have a divorced couple that’s living under the same roof, and that just isn’t going to work.”
Some splitting couples decide to continue to own their home together until a certain milestone, such as their youngest child graduating from high school.
“It’s almost always tied to kids,” Levine said, because couples often want to provide stability. For example, a child who is involved in a very competitive sport may require more consistency in their schedule, so the parents may opt to stay put until the child gets to college.
Some couples are turning to sale lease-backs, a strategy which Levine says is something she hadn’t encountered recently.
Similar to the concept of buying time, a sale leaseback between a splitting couple can mean an arrangement where one individual sells the home to the other, and then rents it back from them with the option to repurchase their share later.
“Some of our customers like it, because in divorce, a lot of people’s credit is screwed, as they’ve been separated for a while and in different households, so they haven’t been paying bills,” Levine said. Those financial setbacks could make it difficult to rent or buy a place on their own.
By selling their share to their ex and leasing it back, they can secure a place to live without having to worry about the debt-to-income requirements, or their low credit score, which can be obstacles to finding housing, she added.
Other divorcing couples, anticipating the struggles ahead should they fight to keep their low rate, have decided to bite the bullet and refinance.
Take one recent divorcee’s case in San Mateo, Calif.
After a mother of two split with her husband in December 2021, they had gone through the process of formalizing their divorce. That meant that she would have to give up the 3.25% mortgage rate that she got in 2020.
She spoke on the condition of anonymity because she did not want her story to affect her child support payments.
“I had to refinance while rates were insanely high,” the homeowner told MarketWatch.
She refinanced in October 2023 to get her ex-husband off the mortgage and the title of the home, as well as to buy him out of his equity in the home. She ended up with a 30-year mortgage rate of 8.25%.
“I have an awful rate right now, I mean, it’s ridiculous. My mortgage has more than doubled,” she added. Her monthly payment went from $1,450 to $2,975.
She considered the possibility of selling the home and using her share of the proceeds to buy another one, or even renting a cheaper home.
But both options were unappealing because she would still be stuck with a higher rate, and would lose her home, which she has lived in since December 2013. She hopes to refinance in the future when rates fall.
“I’m just looking at it as if it’s temporary,” she added. She also got a raise recently which could help offset some of those expenses.
Shea, the suburban Chicago divorcee who didn’t want to give up her 2.8% rate, managed to land a mortgage assumption, meaning that she essentially took over the existing mortgage that had been in both her and her husband’s name, at the same rate.
Assumable mortgages have become an incentive offered by some sellers, but they are rare and only available in certain circumstances.
Shea worked with Tami Wollensak, a mortgage broker who is also a Certified Divorce Lending Professional with specialized training on divorce-related real-estate transactions.
It was Wollensak who recommended that Shea ask her lender if she could assume the loan in her own name. She guided Shea on how to ask for the right department and how to request an assumption, rather than a regular refinance.
“It’s very unusual,” Wollensak, who is also based in Chicago, told MarketWatch. “Every lender looks at it differently.”
Fannie Mae
FNMA,
guidelines give lenders some discretion to grant assumptions to people who are going through life transitions. But borrowers have to qualify for the mortgage and must be able to afford it on their own. The timing of the divorce must also allow for the assumption process to complete.
When Shea first asked her lender, Iowa-based Green State Credit Union, about an assumption, she was turned away. But the duo kept digging and asking for different people to talk to.
The lender eventually allowed Shea to assume the mortgage at 2.8%, and have only her name appear on it. Wollensak says the lender may have allowed Shea to take over the payment alone without her spouse based on her strong credit profile. Green State Credit Union did not respond to a request for comment.
“It depends from servicer to servicer. It’s very much like the Wild, Wild West,” Wollensak said. Shea did not pay any expenses associated with the assumption of the loan, such as closing costs or other fees.
“It was a lot of back and forth trying to find the right person,” Shea said. “I’m so grateful.”
Six people are in custody on Sunday as Metropolitan Police detectives investigate a plot to disrupt the London Stock Exchange, authorities said.
The police said the arrests were made in Brighton, Liverpool, and London.
In a statement, the Metropolitan Police in the U.K. said the allegations are that activists from the Palestine Action group were intending to target the LSE on Monday, “causing damage and ‘locking on’ in an effort to prevent the building opening for trading.”
A representative from the LSE said they had no comment but noted that no trading takes place at London Stock Exchange itself. Equity trading is fully electronic, and there hasn’t been a physical trading floor since 1986.
A representative from Palestine Action said in an email: “The London Stock Exchange raise billions of pounds for apartheid Israel and trade shares in weapons manufacturers which arm Israel’s genocide of the Palestinian people. Whilst Britain remains complicit in the brutal colonisation of Palestine, our direct action campaign will not be deterred.”
The arrests were made earlier Sunday, the police said. The Metropolitan Police added that they are in touch with City of London Police and other forces in the U.K. after a suggestion that this was one part of a planned week of action “to ensure that appropriate resources are in place to deal with any disruption.”
“‘You’ve decided to rip off fans by exclusively broadcasting tomorrow’s Chiefs vs. Dolphins wild-card game on Peacock. For the first time ever, fans will be forced to choose between signing up for yet another expensive streaming service or missing out on a major playoff game.’”
That was part of a letter that Rep. Pat Ryan penned to leaders of the NFL and NBC Sports lamenting that an NFL playoff game this weekend will be available via steaming only for the first time.
“How much more profit do [NFL commissioner Roger] Goodell and NBC need to make at the expense of hard working Americans?” the New York Democrat’s letter went on to ask.
He wrote: “Congress granted the NFL an antitrust exemption in its broadcast deals with the expectation that you wouldn’t use it to screw over fans. That was clearly a mistake.”
Peacock, a streaming service operated by Comcast’s
CMCSA,
NBCUniversal, is one of several streaming platforms that now broadcast NFL games. Some of those services, like Amazon’s
AMZN,
Prime Video, have exclusive rights to certain games, meaning there is no other option to watch on network or cable television, or through a cord-cutting live TV subscription. But while there have been NFL games available only on a streaming platform before, never before has it been a playoff game.
Part of the reason that Ryan, along with many NFL fans, are upset that the Chiefs-Dolphins game is available exclusively on Peacock is that it’s been getting more expensive to watch the NFL in recent years — because, increasingly, games are not broadcast on network TV. In fact, the price to watch every NFL game this season for cord cutters was $1,603, not including the cost of internet service.
That commitment includes the cost of six streaming services and five username and password combinations. Those digital streaming services include Google’s
GOOG,
GOOGL,
YouTube TV, NFL Sunday Ticket, Amazon Prime Video, Peacock, NFL+ and ESPN+
DIS,
And the NFL is reaping the rewards. A decade ago, the league made about $3 billion from its TV deals. But, through all of its broadcast deals today with both networks and streaming companies, it makes roughly $10 billion a year.
Peacock has two plans: a $5.99-per-month subscription with ads, and another option for $11.99 a month that’s ad-free. While fans who live in the local broadcast areas of where the teams play (the media markets around Kansas City and Miami, in this case) will have the ability to watch the game on local TV, the rest of the country will have to pay for Peacock.
According to the Wall Street Journal, NBC paid $110 million for Peacock’s exclusive NFL broadcast rights.
Many fans took to social media to vent their frustrations about having to buy another streaming service to watch an NFL game this weekend.
Responding to the backlash, an NFL spokesperson said in a statement: “The NFL’s media strategy has been to make our games available in as many ways as possible to meet our fans where they spend their time. As streaming video becomes commonplace, we are increasingly expanding the digital distribution of NFL content while continuing a longstanding policy that all NFL games be shown on free, over-the-air television in the markets of the participating teams.”
NBCUniversal did not respond to MarketWatch’s request for comment.
Clermont, Fla., resident Calicia Landry, 53, has been a Dolphins fan for decades. Her family had season tickets during the historic 1972 season when the Dolphins went undefeated — the first and only time that has happened in NFL history.
When asked if she will pay for Peacock to watch the game, Landry, whose town is in the Orlando, Fla., market, told MarketWatch that, despite Peacock’s cost of just $5, “it’s the principle now.”
“I bought NFL Sunday Ticket already. I already pay for television service with DirecTV
T,
I had to have Prime to watch the Black Friday game,” she said. “It’s too much.”
Read on: Here’s how much the major streaming services are set to cost are all the price increases
WASHINGTON — The Supreme Court said Friday it will decide whether former President Donald Trump can be kept off the ballot because of his efforts to overturn his 2020 election loss, inserting the court squarely in the 2024 presidential campaign.
The justices acknowledged the need to reach a decision quickly, as voters will soon begin casting presidential-primary ballots across the country. The court agreed to take up a case from Colorado stemming from Trump’s role in the events that culminated in the Jan. 6, 2021, attack on the U.S. Capitol.
Arguments will be held in early February.
The court will be considering for the first time the meaning and reach of a provision of the 14th Amendment barring some people who “engaged in insurrection” from holding public office. The amendment was adopted in 1868, following the Civil War. It has been so rarely used that the nation’s highest court had no previous occasion to interpret it.
Colorado’s Supreme Court, by a 4-3 vote, ruled last month that Trump should not be on the Republican primary ballot. The decision was the first time the 14th Amendment was used to bar a presidential contender from the ballot.
Trump is separately appealing to state court a ruling by Maine’s Democratic secretary of state, Shenna Bellows, that he was ineligible to appear on that state’s ballot over his role in the Capitol attack. Both the Colorado Supreme Court and the Maine secretary of state’s rulings are on hold until the appeals play out.
Three of the nine Supreme Court justices were appointed by Trump, though they have repeatedly ruled against him in 2020 election-related lawsuits, as well as his efforts to keep documents related to Jan. 6 and prevent his tax returns from being turned over to congressional committees.
At the same time, Justices Amy Coney Barrett, Neil Gorsuch and Brett Kavanaugh have been in the majority of conservative-driven decisions that overturned the five-decade-old constitutional right to abortion, expanded gun rights and struck down affirmative action in college admissions.
Some Democratic lawmakers have called on another conservative justice, Clarence Thomas, to step aside from the case because of his wife’s support for Trump’s effort to overturn the results of the election, which he lost to Democrat Joe Biden. Thomas is unlikely to agree. He has recused himself from only one other case related to the 2020 election, involving former law clerk John Eastman, and so far the people trying to disqualify Trump haven’t asked Thomas to recuse.
The 4-3 Colorado decision cites a ruling by Gorsuch when he was a federal judge in that state. That Gorsuch decision upheld Colorado’s move to strike a naturalized citizen from the state’s presidential ballot because he was born in Guyana and didn’t meet the constitutional requirements to run for office. The court found that Trump likewise doesn’t meet the qualifications due to his role in the U.S. Capitol attack on Jan. 6, 2021. That day, the Republican president had held a rally outside the White House and exhorted his supporters to “fight like hell” before they walked to the Capitol.
The two-sentence provision in Section 3 of the 14th Amendment states that anyone who swore an oath to uphold the constitution and then “engaged in insurrection” against it is no longer eligible for state or federal office. After Congress passed an amnesty for most of the former confederates the measure targeted in 1872, the provision fell into disuse until dozens of suits were filed to keep Trump off the ballot this year. Only the one in Colorado was successful.
Trump had asked the court to overturn the Colorado ruling without even hearing arguments. “The Colorado Supreme Court decision would unconstitutionally disenfranchise millions of voters in Colorado and likely be used as a template to disenfranchise tens of millions of voters nationwide,” Trump’s lawyers wrote.
They argue that Trump should win on many grounds, including that the events of Jan. 6 did not constitute an insurrection. Even if it did, they wrote, Trump himself had not engaged in insurrection. They also contend that the insurrection clause does not apply to the president and that Congress must act, not individual states.
Critics of the former president who sued in Colorado agreed that the justices should step in now and resolve the issue, as do many election law experts.
“This case is of utmost national importance. And given the upcoming presidential-primary schedule, there is no time to wait for the issues to percolate further. The Court should resolve this case on an expedited timetable, so that voters in Colorado and elsewhere will know whether Trump is indeed constitutionally ineligible when they cast their primary ballots,” lawyers for the Colorado plaintiffs told the Supreme Court.
The issue of whether Trump can be on the ballot is not the only matter related to the former president or Jan. 6 that has reached the high court. The justices last month declined a request from special counsel Jack Smith to swiftly take up and rule on Trump’s claims that he is immune from prosecution in a case charging him with plotting to overturn the 2020 presidential election, though the issue could be back before the court soon depending on the ruling of a Washington-based appeals court.
And the court has said that it intends to hear an appeal that could upend hundreds of charges stemming from the Capitol riot, including against Trump.
Videogame maker Activision Blizzard has agreed to pay nearly $55 million to settle a California civil-rights lawsuit brought over complaints of sexual harassment, discrimination and pay disparities by women employees that helped trigger the company’s acquisition by Microsoft.
The settlement, announced by the California Civil Rights Department on Friday evening, resolves the lawsuit filed against the “Call of Duty” videogame studio by the agency in 2021 over claims that it “discriminated against women at the company, including by denying promotion opportunities and paying them less than men for doing substantially similar work,” CRD said.
The agreement, subject to court approval, will see Activision pay nearly $46 million into a settlement fund dedicated to compensating women employees and contract workers at the company, plus more than $9 million in attorneys’ fees and costs. Additionally, Activision will take steps “to help ensure fair pay and promotion practices at the company,” including retaining an independent consultant to evaluate its compensation and promotion policies.
Yet the settlement also sees CRD withdraw its initial claims alleging a culture of widespread, systemic workplace sexual harassment at Activision, according to a copy of the agreement provided to MarketWatch. The document notes that the department is filing an amended complaint that removes the sexual-harassment allegations against the company and focuses on the gender-based pay and promotion claims.
CRD made no note of its prior sexual-harassment claims against Activision in its announcement Friday. A spokesperson for the department said the statement “largely speaks for itself with respect to the historic nature of this more than $50 million settlement agreement, which will bring direct relief and compensation to women who were harmed by the company’s discriminatory practices.
Representatives for Activision declined to comment.
The Wall Street Journal first reported the news of the settlement Friday.
The California agency’s complaint was one of several high-profile investigations by both state and federal regulators in recent years into alleged workplace misconduct at Activision and failures by its leadership to respond appropriately.
While Activision repeatedly denied the allegations, they ramped up pressure on the Santa Monica, Calif.-based company and its CEO, Bobby Kotick, and eventually led to a $68.7 billion takeover bid by Microsoft
MSFT,
in January 2022. The acquisition closed this October after receiving approval by U.K. and E.U. antitrust regulators, though the U.S. Federal Trade Commission continues to challenge the deal in court. Kotick is expected to leave the company, which he led for more than three decades, at the end of this year.
The settlement would be the second-largest ever for the California Civil Rights Department, according to the Journal, after its $100 million agreement with another Los Angeles-area videogame developer, Riot Games, to resolve gender-discrimination allegations in 2021. The agency had initially sought a much-larger settlement with Activision, the publication reported, citing how the state had estimated the company’s liability at nearly $1 billion to some 2,500 employees with potential claims.
When it comes to the baby boomers’ run of investing luck, timing has been on their side.
Decades of stellar stock-market returns produced by a series of bull markets that began in 1982 coincided with boomers’ prime working years and made their nest eggs grow.
Copyright ©2023 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8
Streaming customers are likely to see more familiar faces and less megabudget content in the coming year.
Shifting consumer tastes and corporate strategies portend changes in programming, with artificial intelligence looming in the background, as major streaming services consider how to use technology and new forms of programming without escalating annual multibillion-dollar content budgets.
“The big quandary is, how do we make [services] profitable? Things have shifted so dramatically and so quickly in how people consume,” Cole Strain, head of research and development at Samba TV, which tracks viewership of shows, said in an interview. “The streamers that find out what consumers truly want — they win.”
Streaming services are facing some big choices, noted Jacqueline Corbelli, CEO of software company BrightLine. “The cost of the content and the length of the content war will force them to make some major decisions. They are trying to figure it out,” she said in an interview.
“Great content has to be paid for, and investors want to see an increasingly efficient and profitable business,” she said, adding: “Right now the economics of these are at odds with one another.”
This year’s prolonged Hollywood strikes, the prevalence of up-close-and-personal sports documentaries and the increased licensing of older cable-TV shows are the most tangible evidence so far of how content is evolving. Throw in cost-cutting, and customers of services like Netflix Inc.
NFLX,
Walt Disney Co.’s
DIS,
Disney+ and Hulu, and Amazon.com Inc.’s
AMZN,
Prime Video are looking at a vastly different content landscape.
What’s at stake? Streaming’s big guns continue to spend lavishly in the pursuit of engagement, which is the single most important metric in media. During its third-quarter earnings calls, Netflix said it would spend $17 billion on content in 2024, while Disney pledged $25 billion, including sports rights.
“‘I think when it comes to creativity, quality is critical, of course, and quantity in many ways can destroy quality.’”
Complicating matters and raising the urgency is the pressure, particularly at Disney, to cut costs. The very future of blockbuster movies is also in doubt in the wake of box-office misfires such as “Wish,” “Indiana Jones and the Dial of Destiny” and the latest Marvel entries, “Ant-Man and the Wasp: Quantumania” and “The Marvels.”
“One of the reasons I believe it’s fallen off a bit is that we were making too much,” Disney CEO Bob Iger said at a recent employee town hall meeting in New York City. “I think when it comes to creativity, quality is critical, of course, and quantity in many ways can destroy quality. Storytelling, obviously, is the core of what we do as a company.”
Also read: Disney CEO Bob Iger walks back comments about asset sales
Speaking at the New York Times DealBook Summit last week, Iger acknowledged that “the movie business is changing. Box office is about 75% of what it was pre-COVID.” Noting the $7 monthly fee for a Disney+ subscription, he said the experience of viewing content from home on large TV screens is both more convenient and less expensive than going to the movie theater.
Iger’s task is significantly more fraught than those faced by his rivals. He is in the midst of a turnaround at Disney aimed at making streaming profitable and is simultaneously fending off yet another proxy fight from activist investor Nelson Peltz.
Part of Iger’s plan is to slash costs. Of the $7.5 billion Disney intends to save in 2024, $4.5 billion will come out of the content budget. Previously, the company was aiming at a $3 billion content cut out of a total annual reduction of $5.5 billion. Disney plans to spend $25 billion on content in 2024, down from $27.2 billion in 2023 and a record $29.9 billion in 2022.
Read more: Bob Iger: ‘I was not seeking to return’ as Disney CEO
What streamers have done so far hews closely to the classic TV model of producing original movies and series, broadcasting live sporting events and throwing in licensed content, or syndication. They’ve also displayed a willingness to place ads on their services after vowing not to (in the case of Netflix) and have managed to mitigate spending on pricey sports rights with behind-the-scenes content.
Most prominently, Netflix has licensed older shows like USA Networks’ “Suits,” reintroducing the cast, including a then-unknown Meghan Markle, to solid viewership. “As the competitive environment evolves, we may have increased opportunities to license more hit titles to complement our original programming,” Netflix said in its third-quarter earnings statement.
During the company’s earnings call in October, Netflix co-CEO Ted Sarandos pointed to the historic streaming success of “Suits.” “This continues to be important for us to add a lot of breadth of storytelling,” he said. “Our consumers have a wide range of tastes, and we can’t make everything, but we can help you find just about anything. That’s really the strength.”
The success of “Suits” and of original sports programming, among several tweaks, indicates that consumers like what they see so far. Streaming additions at Netflix and Disney were significant — 8.76 million and nearly 7 million, respectively — during the recently completed third calendar quarter.
Read more: Netflix’s stock jumps more than 10% on huge spike in subscribers, price hikes
“There exist a lot of popular, good shows that people hadn’t seen before. HBO Max has licensed ‘Band of Brothers.’ ‘Yellowstone’ is on the CBS network after performing well on Paramount Global
PARA,
and Comcast Corp.’s
CMCSA,
Peacock,” Jon Giegengack, founder and principal of Hub Entertainment Research, said in an interview. “Consumers increasingly don’t care if a show is new, if they haven’t seen it before.”
On the sports front, Netflix and Amazon Prime Video have sidestepped expensive rights to live sporting events and instead produced docuseries such as Netflix’s “Quarterback” and “Formula 1: Drive to Survive” and Amazon’s “Coach Prime” and “Redefined: J.R. Smith.” Amazon also continues to air “NFL Thursday Night Football.”
Competition for eyeballs is tight with so many suitors — from Alphabet Inc.’s
GOOGL,
GOOG,
YouTube to TikTok, both of which are developing long-form content — and viewers face “too many streaming options,” said Brittany Slattery, chief marketing officer at OpenAP, an advertising platform founded by the owners of most of the large TV networks.
“There is a high churn rate, because consumers keep popping in and out of services because they can’t afford all these services,” Slattery said in an interview.
Also see: Here’s what’s worth streaming in December 2023: Not much new, yet still a lot to watch
Mark Vena, CEO and principal analyst at SmarTech Research, sums up the typical customer experience: “There are too many services for streaming. I will buy service for a month, watch a movie and then cancel.”
Major streamers are pinning many of their hopes on technology as a way to entice viewers and expand beyond the traditional TV model they’ve adopted. Strategies include mobile gaming (Netflix), gambling (Disney’s ESPN Bet) and shoppable media (Amazon).
The biggest near-term change would bring ESPN exclusively to streaming, perhaps as early as 2025, although big games would probably be simulcast on network TV to retain older viewers.
“Technology will be a major impetus for being in the winning circle,” said Hunter Terry, head of connected TV at global data company Lotame, pointing to Amazon’s shoppable-media strategy during Prime Video’s broadcast of an NFL game on Black Friday.
The NFL game, the first ever on a Friday, featured QR codes of Amazon ads for direct purchases via mobile devices and PCs, contributing greatly to what the e-commerce giant said was its best-ever sales day — 7.5% higher than Black Friday 2022. The game drew between 9.6 million and 10.8 million viewers, according to Nielsen and Amazon, making it the highest-rated show on Black Friday for young adults (18-34) and adults (18-49).
And what of generative AI, a major flashpoint in the writers and actors strikes that roiled Hollywood for months earlier this year? Creators feared generative AI would be used to produce low- and middle-brow entertainment without the need for writers, actors or production crew.
The technology is as intriguing to streamers as it is vexing. Full-blown adoption would rankle creators as well as customers. There are also limitations: AI-created content is lacking in humor and original thought, said David Parekh, CEO of SRI International, a leading research and development organization serving government and industry.
“The pressing question is, who goes first among the streamers and risks getting blowback from studios and consumers?” said Rick Munarriz, a contributing analyst at the Motley Fool who covers streaming-service stocks. “You don’t want to offend people, but there are tools to create ideas” at little cost.
AI and machine learning are already being used to mine data to find out what resonates with viewers.
“It is very hard to produce successful content,” said Ron Gutman, CEO of Wurl, which helps streamers and publishers monetize and distribute content, and which was recently acquired by AppLovin Corp.
APP,
for $430 million. “The market is so fragmented. The problem is connecting people to content.”
Big-budget busts present another potential source of content, by salvaging unreleased movies, according to experts.
The so-called dust-bin option is the natural successor to straight-to-video and straight-to-pay-per-view movies. There has been some precedent, with the release of Disney’s superhero hit “Black Widow” simultaneously on streaming and in theaters in May 2021.
Will streaming services end up as the first stop for movies abruptly canceled before release? Candidates include “Batgirl,” which cost $90 million to make and was in post-production when Warner Bros. Discovery Inc.
WBD,
pulled the plug.
The same fate could also await two other shelved Warner Bros. movies, “Scoob! Holiday Haunt” and the completed “Coyote vs. Acme.”
While the $90 million “Batgirl” is a tax write-off, there could be upside to “Coyote” and “Scoob!” if they went to streaming without a costly marketing campaign, said SmarTech Research’s Vena.
Still, the long-term plans of streaming giants to meld tech to TV remains a ticklish task, said Wurl’s Gutman. “TV is a lean-back experience, not a lean-into technology medium,” he said. “People are looking at their phones while watching TV. It is a passive experience.”
Tracy Swedlow, founder and co-producer of the TV of Tomorrow Show conference, said: “They’ve been burning a candle at both ends, investing in original content as well as licensing long-tail content such as ‘Suits’ and ‘Breaking Bad.’ Something has to give.”
After Black Friday’s record-breaker for online sales, there’s hope that the holiday haul for nonprofits will also be generous on Giving Tuesday, and throughout the year-end charitable giving season.
That would be a welcome development for charities that have been burned by inflation and experienced an overall drop in donations last year, experts say.
It…
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A friend calls this day “Thanksscrapping.” He may have a point.
My favorite Thanksgiving story happened at a dinner on Park Avenue about 20 years ago when a lady with a large bouffant and a genial manner — let’s call her Mrs. Anders — raised a glass. Knowing I grew up in Dublin in a Catholic family, she said: “…and I’d like to raise a glass to Fair Eire and hope that the six counties of Northern Ireland are one day free from the British!” She did not realize that the host’s in-laws were Ulster Protestants. They were not amused.
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