🍿 Streaming strike
Hey Snackers,
Started from the bottom, now we're… a deepfake? An AI-generated song featuring the voices of Drake and The Weeknd went viral on TikTok and Spotify. Then Universal Music had it pulled on infringement grounds. Last week Drizzy warned bots: "this is the final straw."
Stocks were mostly flat yesterday as investors chewed on more big-bank earnings and comments from two Fed officials, who both supported at least one more rate hike in May.
The WGA approves a Hollywood writers strike, signaling a potential shift for streaming
EXT. HOLLYWOOD — DAY… In a nearly unanimous vote this week, 9K members of the Writers Guild of America approved a TV and movie writers strike if a new contract agreement isn’t reached by May 1 with studios (aka: their employers). A record 80% of WGA members turned out to vote, signaling clear dissatisfaction among the teams creating your fave shows.
Buffering: Streamers like Netflix and Disney+ are playing a major role in the negotiations. Streaming has led to shorter TV seasons and exclusive rights, causing a steep drop in residual payouts to writers (watching “Succession” five times doesn’t count as a rerun). The WGA wants a new formula to account for the shift.
WG-AI: The union also wants studios to regulate the use of AI — and to bar studios from lowering pay or reducing rights and credits for content that leverages the tech.
Not guaranteed: The WGA authorized a strike in 2017 but ultimately reached a last-minute deal to avoid one. The last WGA work stoppage, in 2007, lasted three months and cost California over $2B.
Lights, camera, no action… While a strike isn’t certain, Hollywood is making moves to prepare. Streaming platforms have several shows wrapped and ready to roll out in the event of a stoppage, and renewals to shows like “Abbott Elementary” were given out earlier than usual. Networks are also bulking up on animated shows (which are written far in advance) and unscripted TV (maybe Netflix can figure out live reunions by May).
Old rules can catch up to disruptors… Now that streaming has transitioned from industry disruptor to industry standard, evading old issues that networks and studios know well (like labor disputes) can only last so long. Similar battles are underway in other tech-disrupted industries like ecomm and ride-hail (think: Uber's gig work and taxi union issues).
Gen Z and millennials rack up record debt as “financial avoidance” leads to retail therapy
Self-soothing with an Amazon order… But seven pairs of Crocs won’t help the real problem (neither will that popular fluffy headband). US consumer debt hit a record high of $4.8 trillion in February as inflation-strapped Americans took out high-interest loans and maxed out credit cards. The IOU blues are especially bad for younger generations:
Pricey cold-brew habit: Millennials’ average credit-card debt rose nearly 30% in March from a year earlier, hitting a whopping $5.8K, Credit Karma reported.
Thrifting or splurging? Gen Z’s average credit-card debt soared 40% to $2.8K as Shein hauls and Celsius habits weighed down balances.
Need those fuzzy slides… to ease the sliding state of finances. April is financial literacy month, but many appear to be choosing “financial avoidance” instead. Sticky inflation, high interest rates, and dwindling savings have fueled anxiety. Psychologists say that ignoring your finances and overspending to cope with stress is typical among younger generations. The pandemic just made it more common.
- Saw it on TikTok: Social media has exacerbated zillennials’ splurge cycle. Lots of younger users make purchases based on influencer recs, a recent Pew survey suggested. And over 60% of users said they regretted a social-inspired impulse purchase, Bankrate found.
The bar for “doing OK” is a lot higher… In December, over half of Americans earning more than $100K/year said they lived check to check. As prices rise faster than wages, US workers are demanding a minimum of $76K to start a new job — up $2K+ from November. Meanwhile, the overconsumption cycle has also raised the bar for getting by.
What else we’re Snackin’
Pill: Johnson & Johnson posted expectation-beating sales growth thanks to strong results across divisions (think: pharma products, shampoo). The Tylenol and Band-Aid maker raised annual guidance by $1B.
APY: As interest rates go up, deposits at banks like Charles Schwab, State Street, and M&T Bank shrank last quarter as customers moved cash out of checking accounts in search of higher returns.
Kicks: Nike said it'll sell digital shoeboxes next month, each containing an NFT styled after the brand's sneakers (blockchain of choice: polygon). As of last year, Nike's NFT sales had totaled more than $184M.
Bans: Montana’s newly passed House bill to ban TikTok downloads could be signed into law soon, but it's unclear how the legislation would be enforced. The bill's author said the app "endangers" Montanans.
Marcus: Goldman Sachs' first-quarter profit fell 18% from last year as losses piled up in its consumer-lending biz. Still, consumer-heavy rivals like Citi, Chase, and BoA notched higher profits.
Wednesday
- Earnings expected from Morgan Stanley, Ally Financial, Citizens Bank, and Abbott
Authors of this Snacks own matic and shares of: Disney and Uber
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