In this week’s edition of Five on Friday, Lee Enterprises enjoys victory after reelecting its board of directors, despite Alden Global Capital’s attempts to replace them, and Hulu will lose streaming access to “next day” episodes of NBC shows. Also, Twitter plans to grow to 100 million users by the end of 2023, Substack launches an app for reading their newsletters in iOS, and Naviga acquires Abacus to expand their digital subscription capabilities.
Lee Enterprises’ Reelects Directors Despite Alden Global Capital’s Attempt to Replace Them
After months of back-and-forth with Alden Global Capital, Lee Enterprises’ shareholders reelected all three director nominees to Lee’s board of directors at the company’s annual meeting on March 10. Chairman Mary E. Junck, lead independent director Herb W. Moloney and CEO Kevin D. Mowbray retain their board seats.
In a statement, Lee Enterprises said that a preliminary vote count showed that Lee’s director nominees received “yes” votes from more than 70% of the votes cast at the meeting, with each of the directors receiving affirmative votes from the majority of the company’s outstanding shares. This election also engaged record participation with more than 75% of Lee’s outstanding shares voting for the directors, an increase of 20% compared to the average turnout from the last three years.
“We deeply appreciate the record turnout and strong support we received from shareholders at this pivotal annual meeting. The results represent a resounding rejection of Alden Global Capital’s campaign against Lee. We look forward to continuing to grow the business and building value as we execute our digital growth strategy. We also remain committed to delivering highly valued local journalism, which is at the core of Lee’s strengths and competitive advantage,” Lee Enterprises said in a March 10, 2022 statement.
In November, Alden made an unsolicited cash offer to buy the media organization for $24 a share, a 30% premium over Lee’s closing price of $18.49 per share as of November 19, 2021. This values Lee Enterprises at approximately $141 million. Lee rejected the offer, and Alden nominated its own candidates to the board of directors. Lee rejected the candidates because they said Alden didn’t follow the company’s bylaws. Alden countered by suing Lee. Last month, the Delaware Court denied all motions brought against Lee by Alden in an attempt to delay the March 10 annual shareholder meeting. The big question now is whether Alden will continue its quest for a hostile takeover.
As of 4 p.m. yesterday, Lee Enterprises’ stock was valued at $28.40, down from the March 10 value of $29.87 per share, but still above Alden’s offer of $24 per share.
Hulu to Lose Some NBC Content After NBCUniversal Terminated Deal
NBCUniversal has terminated a content deal it had with Hulu in which Hulu could stream next-day episodes of popular shows like Saturday Night Live, The Voice, Law & Order: Organized Crime and American Auto, reports Engadget. The goal of this new business strategy is to drive fans of those shows to their own streaming service Peacock. NBCUniversal CEO Jeff Shell alluded to such a change in Comcast’s January 27, 2022 earnings call when he said that much of their strong NBC content premieres on Hulu.
“We’d like to bring that back to Peacock,” Shell said.
A Hulu spokesperson said the company anticipated this change and, as a result, the company is focusing on Hulu originals like Shrill, Only Murders in the Building and Dopesick to draw viewers.
“With the proliferation of streaming services entering the marketplace, we have long anticipated changes to our third-party content offering and over the past few years have increased our investment in original content,” the company rep said.
Not all of NBC’s content will leave Hulu though. Hulu will still have the rights to air certain shows, at least for a few more years, reports Variety. Until the licensing deals expire, Hulu subscribers will still be able to watch Law & Order: SVU, This Is Us, The Mindy Project, 30 Rock, Parenthood and other NBC favorites.
This is a strategy we expect to see employed by other streaming services. The key ways that streaming services differentiate themselves are through exclusive and original content and through pricing. Diehard fans will follow their favorite shows wherever they land, while price-sensitive consumers may lean toward freemium and ad-supported streaming services. Either way, we will see more streaming companies pull their content from rival services as licensing rights expire. Who will be next?
Twitter Hopes to Grow to 100M Users and $7.5B by End of 2023
With Jack Dorsey moving onto other projects, new CEO Parag Agrawal and others at Twitter are stepping up to help the company achieve an ambitious goal of 100 million users by the end of 2023. They also hope to grow to 315 million average monetizable daily active users (mDAU) by the end of 2023, along with a revenue goal of $7.5 billion. At the end of the fourth quarter of 2021, the company had average mDAU of 217 million, compared to 192 million for the fourth quarter of 2020. Of the 217 million mDAUs, 38 million were from the U.S. and the remaining 179 million came from international traffic.
According to The Verge, Twitter has been focusing on restructuring its staff into three primary divisions: consumer product, revenue product and core technology that underlies everything Twitter does. By reorganizing the company in this way, teams are empowered to work differently.
“We are supporting clearer decision-making, increased accountability, and improved execution with our move to a General Manager (GM) model across our consumer product, revenue product, and core tech teams. In this new structure, the GM for each group will lead all of the core resources needed across engineering, product, design, and research for their respective area and report directly to the CEO. We believe this new structure will simplify decision-making, increase accountability, and drive better outcomes,” said Twitter in their fourth-quarter letter to shareholders.
The company hopes to grow to 100 million users and 315 mDAUs through subscription products that improve the Twitter experience (e.g., Super Follows and Twitter Blue) and via new tools for advertisers that will more directly convert ad-viewers into website visitors (Site Visits Optimization, Aggregated Measurement and Events Manager. Twitter is also focusing on creators as part of the Twitter ecosystem and partnerships with media companies, news outlets and sports leagues.
“Our mission is to serve the public conversation, and with a broad selection of content that can be personalized to each individual’s interests, we believe Twitter is the best place to find out what’s happening,” said Twitter.
Substack – There’s an app for that!
Last week, popular newsletter platform Substack launched an app in iOS. Instead of getting links to newsletters in their email inboxes, readers can access all their Substack subscriptions in one place through the app.
The company believes the new Substack app will improve the experience for newsletter writers too with “instant, reliable delivery,” multimedia options and providing another way to connect with readers. Currently, the app is only available in iOS for iPhones and iPads. Android users can sign up to be added to a waiting list.
“As in everything we do at Substack, we see our work on this app as being in service of writers. This is just the first version, but it already incorporates a bunch of early feedback from newsletter authors,” said Chris Best, Hamish McKenzie and Jairaj Sethi in a March 9 blog post.
Naviga Acquires Abacus to Expand Digital Subscription Capabilities
Media software and services provider Naviga is acquiring Abacus, a U.K.-based SaaS company focused on digital subscriptions. Abacus has a proprietary Customer Data Platform (CDP) and Digital Experience Platform (DXP) and a suite of complementary of services to help improve the digital subscription experience. By adding these services, Abacus can expand its offerings.
“We are happy to announce the addition of Abacus to the Naviga family,” said Scott Roessler, Naviga CEO, in a March 8 announcement. “Abacus brings award winning software that has been proven to help brands and communities grow engagement and revenue with personalized digital experiences. Combining this functionality with Naviga’s existing Content Engagement Platform will provide our customers with exceptional opportunities to provide targeted offers and relevant content driven by data insights across multiple channels.”
“Abacus and Naviga share a common goal of delivering software that expands what our customers can achieve by leveraging audience data,” said Al Bird, CEO, Abacus. “Our platforms enable users to manage both their content and their audience in one digital solution. We are excited to join the Naviga team and work with them to deliver even more digital capabilities to our customers.”