The immediate financial impact will entirely depend on the length of the strike. The disruption in 1988 lasted five months and cost big media $500 million. But the end game will likely be much bigger this time around:
Who are the winners and losers as movies, music and TV become entirely clickable?
Anthony DiClemente, media analyst at Lehman Brothers, joins the panel for this conversation. Following are excerpts.
What’s at stake?
The writers want a greater royalty on digital content, says DiClemente. Writers are fighting for the highest residual and the producers (who are represented by the studios) are fighting the other side of that battle.
And you believe CBS (CBS) and Disney (DIS) are most vulnerable to the strike?
Yes, replies DiClemente. 2/3 of CBS’s business is TV related. CBS is the least diversified.
Disney has a number of hits that are scripted, he adds. Shows such as “Desperate Housewives” and “Lost” will be impacted.
And you think Time Warner (TWX) and News Corp (NWS) are most insulated from the strike?
Those are just two very diversified companies, says DiClemente.
Would you short CBS?
I would say CBS is the company that makes us most cautious, answers DiClemente.