Welcome everyone to Bank of America's Media, Communications, and Entertainment Conference 2023. Our pleasure to have with us on stage. Well, first of all, I'm Brian Fenske, the TMT sector specialist here. It's my pleasure to introduce to you for the second year in a row here, Nexstar Media Group. Today we have with us Tom Carter, a 14-year veteran of Nexstar, former President and COO of the company, who recently announced his planned retirement and transition to Senior Advisor to the CEO and board of directors, and also company CFO, Lee Ann Gliha. So welcome, and thank you for joining us.
Yeah. Thanks for having us.
Thanks for having us. Yeah.
Of course. Of course. So, you know, as we started developing these questions in advance of this, the narrative changed on us. So it felt like we were gonna be sitting here, and Disney and ESPN was still off the air, and they've obviously reached a settlement or a negotiation. So I'd love to just kick off with what that could have meant and maybe what are some of the interpretation of this agreement and the fact that it was settled so quickly, if you will?
Yeah. I think, you know, we saw our stock take a hit, as a result of the Charter-Disney dispute, and it's now on its way to recovery. But we, you know, we definitely think that the outcome was good for us from a broadcasting perspective. I mean, at the end of the day, what ended up happening? The premier programming stayed, got paid. The DTC services are now actually being looped back into the bundle, and the lower-rated networks got rationalized. And, you know, I think all of this supports our business model. You know, I think there were some questions about, you know, how does this impact broadcast at ABC? You know, the conversation about the broadcast model in ABC was actually very, very limited.
You know, I don't know if everyone's familiar, but with respect to the broadcast networks, they enter into affiliation agreements with station groups to air their content, like us, and then we have the right to negotiate with the MVPDs. So with respect to this Disney-Charter conflict, they really have the smallest O&O station footprint of any network out there. They only have 8, 8 stations. So the discussion about ABC was actually limited to that, and obviously, that got renewed. You know, we also feel like... You know, the other thing that's interesting is that the broadcast networks, you know, we actually over-deliver for the MVPDs. You know, we're the most watched stations and networks, and we're proportionally paid less relative to our ratings.
Like, so for example, you know, when this all happened, I said to our ratings guys: "Can you actually go back and pull for me, for all of 2022, 24-hour ratings on average, seven days a week, for the national content?" And what came back was the top four broadcast networks generate the most viewership. We actually generate four times more viewership than ESPN, which is the seventh-rated network. So if you think about the importance of that programming, it's very important, and we get paid less for it. You know, broadcast networks, in general, get paid about 26% of the total pie of retrans and cable affiliate fees, but we generate 40% of the viewership. You know, we're actually the cable company's best investment. We return very well for them.
You know, and on top of that, the other piece I point out, I just want to make, is that our local broadcast affiliates really provide valuable local news and other content. You know, so at the same time, I asked the ratings guys to go back and give me that broadcast, those network ratings. I said: "Can you go back and look at just over our overall station group over the last 12 months? How much of our viewership is from network content versus Nexstar content?" So our local news, our syndicated content. And the answer was, for the last 12 months, our non-network content was 45% of our viewership. So go take those broadcast numbers and then double them because that's what we're providing to our customers.
So, you know, we think, because we're the most popular networks offering the majority of the NFL content and our local news and other programming, that, you know, we are gonna be successful, continue to be successful with our MVPD relationships. And our content has continued to be offered on the most basic tier because of that. And, on top of that, we're not competing like Disney was with the MVPDs. We don't, we don't have our own DTC platforms, or we're not making our content less exclusive by putting it on other platforms more cheaply. You know, we're invested in the health of the ecosystem. You know, and then to make it really clear, you know, we did about 50% of our subscriber renewals towards the end of 2022. We did our ABC deal at the end of 2022.
And all of that has been business as usual. So, you know, we feel like, you know, we've got, you know, good visibility and good reason for our business to continue in the way that it has been, and we don't really see this conflict being anything but, you know, somewhat positive because now, guess what? DTC's back in the bundle, where probably it should have been.
Excellent. Now, you know, while we're on the topic of DTC, that obviously became a focus of the major media companies over the last few years. We've seen it be quite destructive to the free cash flow of those companies. You guys have always been somewhat of a free cash flow machine. So, one, how do you think DTC plays out, and how do you guys participate, not participate, compete in that DTC ecosystem? And do you suspect that these larger media companies are going to back away from DTC, lean into the linear business where, you know, they historically generate lots of free cash flow as well?
Yeah, I mean, look, I think our point there is, if you look at the major media companies, Fox, Comcast, Paramount, Warner, Disney, almost 80% of the revenue comes from linear, and all of the profit comes from linear. You know, there isn't any DTC product out there that actually makes money. And so, you know, we think that this will incentivize those media companies to lean back into linear. And you're already kind of seeing that. You're seeing price increases that are happening on the basket of DTC services. Now, a basket of DTC services is actually more expensive than the average cable bundle.
And, you know, I think the other piece of it is, you know, half of the video revenue that these companies generate is from distribution, which is supported by the MVPD companies that generate almost half of their residential revenue from video services. So there's just an entrenched reason why linear needs to continue to exist. But that doesn't mean that DTC is gonna go away. You know, we think it'll coexist. I mean, the interesting thing that we point out, and we see this with our CW app, is that, you know, there is a younger audience that's on these DTC platforms, and it's almost, you know, non-exclusive, right? You've got two unduplicated, different audiences, a younger audience here, an older audience here.
And so, you know, we do feel like, you know, you probably, you may need both, going forward, and we don't have any problem coexisting. We've coexisted with lots of other video services for many, many, many years. And at the end of the day, you know, the largest and most distributed audience is the broadcast audience. And here's where I'm gonna just take a minute, sorry, but I wanna give you guys my broadcast virtuous cycle pitch, because this is against the MoffettNathanson article that came out, or the chart of the doom loops. I've got our broadcast virtuous cycle, which is, one, our content's already the most watched content. Broadcast has the broadest reach of any medium. We reach 76% of the population on a daily basis. Sports teams and leagues wanna be on broadcast.
They wanna reach the most people. They don't wanna alienate fans. They wanna create more health of their franchises and grow that value. You know, NFL is a perfect example of this. And as a result, you know, pay TV providers are gonna continue to carry and pay broadcast networks because it has the key sports and news content that audiences want. And then viewers will continue to subscribe to pay TV services to access the content in an easy-to-use interface, and that virtuous cycle will continue. So, you know, I think that, you know, to answer your question, you know, I think we'll have some rationalization, we'll continue to coexist, but broadcast will continue to thrive as it has, you know, for many, many years.
To just clarify something, 'cause the word linear sometimes has a negative connotation these days, 'cause just some people's mind goes to, that's legacy, sitting back on a couch watching TV like my parents did, and new media is DTC. But I think what you're saying is linear is kind of the old distribution model.
Yes.
It's intelligent. It's still gonna have apps.
Yes.
Still gonna have websites and streaming. It's just not going to be do it alone. It's gonna be do it with partnerships with-
Absolutely.
MVPDs.
Absolutely. Absolutely.
That's great. That's really helpful. So a number of media companies, including Disney and Paramount, have engaged in processes or talked about potentially selling or reconfiguring their asset portfolios. No major news has hit yet, but it's certainly a topic our Jessica Reif Ehrlich has written extensively about. Since M&A has always been a clear driver of growth for Nexstar, how do you see your company potentially participating?
Well, we think that there could be some opportunities, depending on, as you say, how it really falls out. I think, you know, all of these companies, Disney included, you know, have shareholders to answer to for these massive amount of investments and the massive, you know, free cash flow that they're reinvesting in direct to consumer, that may make some of the linear assets, as we just talked about, available. But it's interesting, you know, and I know that, Disney had talked about it this way, you know, let's kind of morph into a growth co and a sustainable co, if you wanna think about it that way. The only issue is, the sustain co is funding the growth co, and if you sell one, you've lost access to that cash flow.
Now, granted, you're gonna have proceeds, but, you know, is that really what you wanna do and how you wanna fund that with a one-time sale versus, you know, correcting? So, and but, to your point is right, you know, we spent the better part of the first 10 years I was at Nexstar in an acquisition mode. We made over 40 acquisitions in 10 years. A couple of them were sizable, where we more than doubled the size of the company, and we did it with largely debt, but those were massively accretive. The Media General transaction was 40% free cash flow accretive, and the Tribune acquisition was 60% free cash flow accretive. That's work worth doing. If those types of opportunities present themselves going forward, whatever it is, I think you'll see us take a look at it.
but more specifically to those assets, a lot of those assets, the linear and the DTC assets, are intertwined-
Mm-hmm.
From a programming perspective and from a content perspective. You're seeing, you know, ESPN simulcast the majority of their large sporting events on ABC. If you were to buy the ABC complex, how would that work going forward? So there's a lot of, there's a lot of questions that need to be answered there, but it's something that we-
Have you hit the regulatory limit yet for station acquisitions, or?
We are-
Okay.
-but that would not preclude us from buying stations because, as Lee Ann rightly pointed out, ABC's portfolio of stations is modest. It's only eight, largely in the top 10 markets. We're in eight of the top 10 markets already, so we could buy... and with a CW station, we could buy a second station in that market and not increase our household footprint.
Got it.
There may be a few stations that would require divestiture, either of a Nexstar station or an ABC station, but we could onboard those with relatively little friction.
Got it. Okay, extremely interesting. Switching gears here-
Yeah, before we leave, the only thing, I don't know if there's a deal to be done there.
Right.
Because I think they've got to be a little bit clearer in their own thinking with regard to how that goes, because, you know, we can take direction, but we're not necessarily out there leaning into any of this stuff without a clear path.
Understood. So, yeah, switching gears a little bit, you have an ongoing dispute with DIRECTV.
So I'm told.
Where you've taken down your stations from their service since the start of July. Any update you can provide on this, key sticking points, asks, and what are they thinking?
All good questions, not all of which I can or will answer in a public forum. But you're right. I mean, you know, the first month or so, we were, you know, in blackout with them. There wasn't a lot of movement going on. We've been in pretty constant contact over the last several weeks. Progress has been made. We don't have a deal.
Mm-hmm.
We're not going to do a bad deal.
Yep.
But I think, you know, our expectation is that we will reach an agreement at some point, hopefully sooner rather than later, because everybody agrees it's not in anybody's best interest to alienate the consumer.
Right. Okay, thank you. A point I wanted to get to is your view on capital structure and leverage and use of free cash flow. You know, you're as you said, you've intelligently used debt when we were in a very low-rate environment to make these incredibly accretive free cash flow deals. So I'd love to just hear some commentary, because I think you guys have been very thoughtful about use of the balance sheet.
Yeah, I mean, look, from a leverage perspective, for the last quarter, we were at 3x leverage. We don't feel like we're in any situation where we're over-levered. We also don't necessarily feel like we're under-levered. We've been as a result, then, we've had the flexibility to use our free cash flow to fund our dividends, to make some, you know, a few small acquisitions. We did a small station deal earlier this year, and then, you know, to use the balance of our free cash flow for share repurchases, because we feel like our stock, you know, is incredibly undervalued at these levels.
Great. Thank you.
Especially at these levels.
Yeah.
Yeah, absolutely. And I noted that earlier in the day, but it has been one of the best-performing media stocks on a trailing one-, three-, five-year basis, and-
Yeah.
Yeah
... it doesn't get highlighted all that often. So switching gears a little bit, there's the traditional companies. We've talked about a few. Charter came up in this discussion and so did DIRECTV, but obviously Hulu and YouTube TV are two of what we call virtual MVPDs in this world. So can you just, and I guess, educate us a little bit how negotiations and deals work with those players? How different are they, either from the complexity or are they easy to work with, and what's it like?
It's more complicated under the virtual world than it is under the traditional MVPD world. The MVPD world is very closely governed by FCC regulations, because that was part of the ecosystem when the whole concept of must-carry or retransmission consent was really put in at the end of the nineties. At that time, virtual MVPDs didn't exist, so they ended up being classified really as more Internet than video providers and distributors. And so the stations are granted under FCC regulations for the each individual station or group of stations with the right to negotiate directly with the MVPDs, and that's what we do. That's what we're doing with DIRECTV, all the cable companies, et cetera.
Because the virtuals are deemed more to be digital, the networks have retained the digital rights that they have, and so they negotiate with the virtual MVPDs, and then they offer us the right to opt in or opt out of that. It's a binary kind of outcome. You either like it, and you opt in, or you don't like it, and you opt out. Obviously, there's always a third alternative, which is you, everybody band together, and you try and negotiate a better deal with the networks. But there's an intermediary between us and the virtual MVPDs, which is the network, and the network can, you know, negotiate for more than just carriage of the network with those virtual MVPDs. They have other properties that are cable channels, et cetera.
So they have the potential to have conflicts with regard to what's doing best for the network and its affiliates, and that's where we take umbrage with that. And there is a move afoot in Washington through our, you know, government representatives and the National Association of Broadcasters, because the business of the vMVPD and the MVPD are not any different at all. It's just the delivery mechanism, and it's now a delivery mechanism that's excluded from FCC regulation because it didn't exist at the time that that regulation was put in place. So maybe it's either a regulatory solution through the FCC or a legislative solution through Congress to include the vMVPDs in the retrans ecosystem that exists. We think that's a fair outcome.
And is there a momentum? It reminds me a little bit of the music industry-
Yeah
... you know, moving from radio to satellite to streaming. We had to-
Yeah
... adapt copyright rules-
Right
... and things like that. Does this have momentum, this movement?
I would say it does, but is it at the top of any legislator's list? No.
Mm-hmm.
But, you know, that's incumbent upon us and our peers to go out and make it so. But it's also difficult because we have the networks that are pushing back against it because they see value accruing to them in the existing ecosystem.
Got it. Okay.
So there's not unanimity in the sector with regard to how this should work.
Okay. We'll see how that-
Stay tuned, as we say on television.
So, Lee Ann, you referenced this, that 50% of the deals were kind of struck last year, which is great. Helps de-risk the portfolio for many years. But, can you tell us a little bit about—Obviously, I'm not asking you for the details of these agreements, but what have you seen in these recent resets with Fox and ABC towards the end of last year? How has the balance of power shifted, if at all, over the last few years?
Yeah. Look, I think we've been very clear with our network partners that historically, part of what we have paid a large amount of our, you know, our largest expense is the payments to our network affiliate partners in the entire corporation. So part of what we have historically paid for is exclusive programming. With, with the exception of Fox, the other three networks have started to diminish the exclusivity that we have by putting the same programming, whether it be football on ABC and ESPN or Paramount+ or Peacock, putting some of the programming that historically has been exclusively available to network affiliated on their DTC platforms.
That diminishes the value of that programming to us, and by the way, they're creating a whole new revenue stream, or at least part of their revenue stream, on the backs of something that used to be exclusively for us. So we've told them historically, if that starts to happen, we'll start to pay less in affiliate fees, and you're starting to see that manifest itself.
Will investors start to see that reflected in the...? What line item on the income statement would that be, your costs go down?
Station operating expenses.
Station operating expenses start to, you know, moderate.
Right. You know, the growth will tail, and then eventually it will start to decline.
Right.
At least that's our expectation. And this year, we really, in our guidance, we said that we expected, and this was before the DTV blackout, if all went according, went well, we thought our retrans revenue growth would be high single to low double digits, percentage growth, and we said that we believed our total network affiliation payments would increase mid-single digits. So that's how you can see that retrans revenue continues to grow and the cadence or the trajectory of the growth in the network affiliate fees would start to moderate.
Got it. Now, next question, I wanted to ask you a little bit about concerns that are around traditional media, larger media, and you guys about just subscriber declines, just classic cancellation, cord cutting that we see. How are you guys contending with that? How do you plan on growing revenues as a total company in the face of, you know, subscriber attrition and, you know, how do you think about it?
Sure. I'll start and let Lee Ann follow in behind. Yes, I mean, we're experiencing that. We're not adverse to that. As the largest television broadcaster, I think it's gonna be hard for us to materially deviate from that. We had some stations that weren't historically carried by the virtuals, and we have worked hard to get those included, so we did have a little bit of an uptick or a relative decline, lessening of decline in our subscribers relative to some others. But, you know, I think one of the benefits of the Charter-Disney deal is basically, we're putting the band back together. We're recreating the bundle by bringing Disney+ back into the pay television ecosystem and not strictly as a DTC product.
So I think that one of the potential benefits of the Charter-Disney deal is it could potentially lessen the decline in attrition or lessen attrition going forward because there's less reason for those subscribers now to leave the pay television ecosystem to a all-DTC type of bundle, because one of the biggest DTC players is now inside the bundle. That all of the the Charter subscribers will have access at some point to Disney+ or some version of Disney+. So we think that that's a positive development overall and could affect attrition. But generally, I think, you know, attrition is driven somewhat by the direct consumers, but we participate in that to a degree.
And so from that perspective, I would say, generally speaking, we believe that attrition will continue, but we disagree when people say that the pay television ecosystem as we know it now in linear is going to zero.
Yeah, and the other point I would just add on to that is just what I said at the beginning, which is we're still undercompensated, right? We're delivering a higher share of the viewership than we are receiving of the fees. So as we, you know, as you saw in our guidance for this year for distribution, we were able to guide towards something that was a higher growth in that revenue line that offset the re-- the attrition. So, you know, I think we anticipate we'll be able to continue to do that.
So in a way, some of those lower quality networks that are getting pushed out, that part of that pie-
Right
... could accrue to you.
And that's what's causing the, you know, disparity in our you know, our contribution to the viewership versus the what we get in return is because there are other, you know, content providers where that's upside down, where they're getting paid more than they're contributing. And when you start to get rid of the bottom, you know, quartile of underperforming and marginally viewed cable channels, that's where a lot of the dollars aren't big, but the dollars can be meaningful in terms of redistributing it to others in the ecosystem.
Got it. Now, moving on to a different topic: sports. Obviously, sports played a critical role in accelerating this Charter-Disney deal timing, as everyone was anxious to watch sports during football seasons. But, they're a big driver of viewership. Engagement is unbelievable. It's been. Fans are passionate. Obviously, you know, you're a leading affiliate of all the major broadcast networks, therefore, you participate in sports in that way. But, I've seen you've done a number of deals for sports rights at the CW. Your L.A. station renewed its deal with the Clippers. Can you talk a little bit about your, how your company participates in sports and, and why it's important?
Well, I think let's first back up a second. All of the sports teams, all of the conferences, all of the leagues want to have a presence on broadcasting because the pay television ecosystem is not ubiquitous. It doesn't reach all of their fans, and what they want is engagement with their fans. And the way to do that, the only way, really, to do that, is through the broadcast medium. That works for the teams, and it works for conferences and the leagues. And so you're right. We see that with the NFL, and we participate on all four of the big four networks in their NFL offerings and college offerings. As you know, we bought the CW in September of last year. It historically had had zero sports programming on it.
We took a little bit of a flyer on LIV Golf early this year and had great success at the station level. I think some of the historical golf advertisers were still very much wed to the PGA Tour, and so on the network level, it didn't work out so well from an advertising perspective. But that's okay because we had a really low-risk contract in terms of the fee payable to LIV Golf. It was basically a rev share deal. So it wasn't really... We weren't exposed to anything there.
But what we found is the affiliates were very excited to have sports, especially because CW had never programmed weekend days before, and that's, you know, that's a fertile field for us because we could now program five to six hours a day on the weekends with sports. We have done that with ACC Sports, Atlantic Coast Conference, and with NASCAR, which we announced we'll start the Xfinity Cup in 2025, and we'll have sports on 48 out of 52 weekends in 2025.
And that's all new programming to the local affiliates and to our CW affiliates that they haven't had before, and we're able to. We'll be able to increase our affiliate fees that we charge those stations for CW programming, and they're happy to pay it because they see value in that, and it's really, you know, new programming and new time slots that can attract new advertising. And so we're seeing that on the network side and then on the local side, you're right, we have an agreement with the Clippers, and it's the same thing. Historically, they were a sports, a regional sports network-only customer. But again, the regional sports network or regional sports channels in Southern California are even more fragmented.
There are so many of them, and so they weren't reaching nearly all of their advertising or all of their fans. So we're taking 15% of their regular season games, putting them on KTLA, promoting them, and not only are we broadcasting them in Los Angeles, we're broadcasting them in San Diego and Bakersfield as well, where we have stations to elongate their footprint and reach more of their fans. But they don't give up the entire direct-to-consumer product because Steve Ballmer obviously is the owner of the Clippers, and they're gonna do their own white label product that they can, you know, do on their own from a direct-to-consumer perspective that, you know, will cover the other 85% of their games. So it's a portfolio approach locally and nationally.
It's an approach where a lot of the leagues and the teams, NASCAR in particular, wanted a broadcast network because their historical providers are Fox and NBC, but the Xfinity Cup had been relegated to FS1 and to USA, not to broadcast for the most part. And they see broadcast viewership as, you know, a potential 40% increase over the cable channels that they've historically been on.
Now, the financial stress that RSNs have been under for the last few years, it's been a challenged model, to put it kindly.
Yes.
That seems like it's going to create opportunities for you to get high-value sports programs from RSNs who are seeking to strike creative partnerships to get eyeballs. Is that fair?
Well, you know, we've used the term we're playing Moneyball with sports programming, and the ACC contract is a great example of that. That was a contract. It's a national contract, but it has historically had been purchased by Bally's. During the bankruptcy process, they rejected that contract, and we got word that they were thinking about doing that. And so 10 days after they rejected the contract, we picked it up for a fraction of the cost that Bally's had been paying. Last Saturday night was the first ACC football game on the CW Network, and our game was up against the Big Ten Saturday night game on NBC. And our Pittsburgh-Cincinnati game outdrew the audience on the NBC games.
I'll tell you, they paid $hundreds of millions for that contract, and we paid significantly less than that for the ACC.
That's great.
So, we think about it just in a cost-per-hour basis.
Got it. I wanted to talk a little bit about demand, advertising, macro trends while we have you up here. But, you know, world seems to be factoring in soft landing to a degree. Any update you guys can provide on the trends you're seeing in local advertising by businesses in the markets in which you serve and just demand out there?
I think, no, no, no change in the trend, no change in our commentary. Our local business has significantly outperformed our national business. Local is a lot closer to the consumer. It's more of a demand and a price and an item and a sale type of ad. And the closer to the consumer you are, I think the better off you are right now, because the consumer continues to be healthy. I think what you're seeing in national advertising is an uncertainty in the overall economy. And the closer you get to the cash register, I think the better businesses feel about the health of the economy.
Okay. That's great. And then, look, we're heading into 2024, presidential election year. Can you remind us how big this is for you guys and, and any expectations, whether yours or experts, we should pay attention to on the topic?
Well, I think, you know, nobody expects this election to be any less contentious than the last several elections, and obviously, we have the added benefit of a presidential contest this time, where we didn't two years ago. Each of the last two cycles, we've been in excess of $500 million of revenue, which is substantial. And also it's interesting because the last presidential election being in excess of $500 million is noteworthy, but the last non-presidential also being, for us, in excess of $500 million is noteworthy because historically, about 25% of an advertising-- of advertising in a presidential election is around the presidential election or in a presidential cycle, is around a presidential election.
So you can, you can see why some of the estimates for 2024 can get a little out of hand in terms of what the expectations are. But we, we clearly expect it to grow. I think there are a lot of different ad agencies that give their, their estimates on total political advertising, but all of them have it increasing double digits over 2022, and we think it'll probably do that or potentially more.
Okay, great. Another topic I wanted to... I wanna see if there's any questions in the crowd. We have a few more minutes left. Anyone? Okay, we'll keep talking. You recently put out an RFP for a measurement company, and your Chairman and CEO, Perry, made some comments on your last earnings call, talking about being undermeasured. This has been a controversial topic in media and in the transition to digital media for the last several years. So can you talk a little bit about what you're looking for here and how you think you're not getting measured properly or some of you?
I would say, our problem with the measurement or our, you know, general unhappiness with the measurement, it comes primarily in out-of-home advertising or out-of-home viewing and in local viewing, specifically outside the top 50 or 55 metered markets, which is a large portion of our television station portfolio. And so we're looking for either new entrants or the incumbents willing to put more assets and emphasis on those two areas in particular, because we think, you know, whether it's viewership in bars or clubs of sports primarily, or viewership in small markets where people meters aren't used, and essentially what they do is they mathematically try and extrapolate what viewership is. We're looking for more, more, you know, consensus and also energy to be put behind those two efforts where we think we're underrepresented.
Okay, and, I guess getting down to the wire here, but I wanted to ask you, obviously, The CW was an interesting deal that, that you guys struck and, and acquired, about a year ago, I think. So, we see the new slate is launched. You recently announced some distribution deals at Sinclair, Gray, and it has sports rights as well. Are you more or less optimistic about this business than from when you acquired it? And just any color on The CW, how it's going?
Yeah. I would say we're equally as optimistic about it. The sports, I wish we could say, you know, when we did our strategic plan in the lead up to the purchase of The CW, we knew that the RSNs were gonna implode. We knew that a lot of the teams were gonna come back on the market. We knew that there would be new opportunities like LIV Golf, because all of those opportunities fit well for us. When you consider that the incumbent sports providers, the four large broadcast networks and ESPN basically have overbought, and not only from a price perspective, but from a volume perspective. They have more sports than they can show, and so ESPN has put a lot of that now on ESPN+ , but that, that's expensive to a relatively small audience.
And so we're at the intersection of, you know, the right time to be coming to market interested in sports, because, again, we had 12 hours a weekend of basically fertile field, ready to plow with good sports programming. So we always thought we would get into sports programming, but to have ACC football on less than a year in, to have golf, live golf on less than a year in, and to have, you know, a major portion of NASCAR's product on our network two years in, is a win for us.
I have one last question, and it's a little more, I don't know, thematic or topical, which is, as we're sitting here and talking about Disney+ being folded back or made available in a bundle, it's kind of a jarring thing to say, or a change from the last year. Am I reading that right? Is it that big a deal? Did it just-- Did we just like, in the last w- did, did... Was the bundle just saved?
Well, you know, if you look back on when all this started, which was really, you know, at the tail end of the pandemic, right? It's when everybody was at home, everybody was consuming more television, everybody wanted more choices. You know, the hue and the cry for more entertainment programming was, you know, at its zenith. And back then, in the zero interest rate economy, everybody was paying premiums for growth. Well, we're in a different economy now, and growth is important, but, you know, growth has to come with profit. And, as you know, Lee Ann pointed out, all of the major large media companies that have DTC products are losing money on their DTC product, and there's no clear pathway to profitability.
And so I think investors have had a meaningful effect on companies with regard to, you know, growth at any cost, which was basically what they initiated and how they set out down this path from a DTC perspective. But investors have pivoted away from that, and the companies are having to do that, too. So, yes, I would say relative to two years ago, it's pretty shocking. Relative to last year, I don't think it's shocking at all.
Yeah. Perfect. All right, well, thank you, Tom. Thank you, Lee Ann.
Thank you.
Again, really, really appreciate you guys attending our conference.
Great. Thanks, everybody.
Thank you.
Appreciate your interest.
Thank you.
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