It was the smash hit of the summer. Netflix’s new crown jewel, K-Pop Demon Hunters. Now the streaming giant’s most popular movie ever. After a real-life theater release, Netflix inking a huge toy deal with Hasbro and Mattel. Netflix turning its views into big-time revenue too. The company announcing it made a record amount on ad sales. Some of those ads could soon get an AI twist, with Netflix saying it will test new ad formats by the end of the year. It reinforces Netflix’s. Have y’all seen some of these ads lately? And you can tell that it’s AI.

People are using AI horribly, horribly. And I’m seeing people running ads for AI or AI style ads. The audio sound weird. And it’s like y’all gotta not be so quick to try to push that. The audio sound weird. The video look weird. Prompt engineers. I don’t know who green-lighted some of the stuff that y’all looking out. But some of these ads are horrible, bro. They are absolutely horrible. And I’m seeing them on every platform. See them on TikTok. I see them on here. I see them on a lot of these platforms. These ads are trash. These AI ads are absolute trash, bro.

Whole position among a dizzying array of streaming competitors. All vying for your attention and money. At HBO Max, customers will now pay another buck or two per month. The company’s third price hike in three years. I know. $2 right doesn’t sound that bad. Wrong. This is terrible. Experts say, get used to it. We’ve seen Disney Plus raise prices. Hulu raised prices. Peacock did so. Netflix did at the beginning of this year. It’s more important for them to make money than to attract subscribers. Streamers are betting on must-see content. Here you go, big dog. As Prime Video and Peacock, owned by parent company NBC Universal, lean on new deals with the NBA.

And Disney Plus gears up for the December release of the much-awaited Taylor Swift tour documentary. Right now, let me tell you what’s happening within the streaming industry. A, a lot of these streaming companies like HBO is raising prices. I love Netflix. I’ve always been a fan of Netflix from an investor’s perspective because they give crazy value back to the shareholders. And one of the reasons that I like Netflix is because they understand the industry and they understand the market, right? So I’ll give you an example. One of the biggest metrics, and I’m not going to deep dive into it.

Don’t worry about it. Bag chasers. We’re going to talk about it on Wednesday or Wednesday or Thursday. One of the biggest metrics to measure if a company is doing well is can they do two things? One, capitalize off of the base that they already have. So increased revenue. One of the ways that Netflix increased revenue was to run ads. And so they generate a lot more revenue in that. And then two, do they continue to grow their subscriber base? So for example, one of the biggest things that prop up a stock is if your subscriber base is growing or your growth or your numbers or your ability to penetrate into new markets.

Netflix has had a chokehold, a chokehold on the market since the beginning of time. So when you see HBO Max, Peacock, all of these other streaming services, Disney Plus trying to keep up and compete, the only reason that Apple TV and Amazon Prime or Plus is still winning or is still running it up is because they subsidize by other parts of the companies. And so they’re OK with losing money or becoming a loss leader so that they can then get you to get more movies or get you to be subscribed or all of this stuff.

The play is long term. But when it comes to the individual platforms, I think that Netflix is head and shoulders above all of these other platforms. It comes after one research firm estimated Disney Plus and Hulu cancellation rates doubled after Jimmy Kimmel’s show was briefly paused. The latest trend bundles with Disney Plus, Hulu and HBO Max opening a bundle beginning at 1999. They trying anything. And now Apple TV and Peacock joining forces on a package starting at $14.99. Adding another layer of confusion, consolidation in the media industry with Warner Brothers Discovery putting out a for sale sign, meaning HBO and Batman could be looking for new streaming homes.

And so they saying that several different platforms, sometimes some of them are saying Netflix. Others are saying, what was the other platform? Oh, Comcast. Comcast is also supposedly in the bid to try to buy Warner Brothers assets because Warner Brothers listed itself for sale soon. So apart from these bundle offerings, are there services trying to kind of hook you in and then crank up the price? Yeah, well, that’s exactly it. I mean, live events, I think, are one big example of that. All of these big sports events. I mean, don’t forget Netflix is going to make a money back football game again this Christmas.

But there are all these offers that credit cards and also stores are offering it. For example, if you have a subscription to Walmart Plus, you also get a Paramount Plus or a Peacock Premium subscription. And again, there are also these interesting partnerships that they’re trying to use. Cable was the best back in the day. I disagree. Cable was trash and it was overpriced. Spotify and Netflix announcing a partnership where more video podcasts will be coming to the Netflix platform so you can listen on your way into work. But then when you go back home on your couch, you can watch that in a video format.

So again, these are ways that they’re trying to incentivize you to pay for what’s going to be a higher cost for the stream. So what I think is that these companies are going to start to consolidate because you got too many different streaming platforms asking you for money. Especially considering that it seems like the industry is starting to contract. I think that you’re going to experience a selling off of assets from different companies that can’t compete and stand on their own. Warner Brothers is probably just the first one to fall. But you’re going to start seeing it because people are starting to get what? Streaming fatigue? Streaming price fatigue? And all they did was replace it when you thought that you was getting something cheaper and at a better price.

All they did was replace cable with a bunch of streaming services. So now you got to have Apple TV, Netflix, Amazon Prime, Peacock, BT Plus, ABCDEFG, whatever it is, Warner Brothers, all of these different platforms. And so what I think is going to happen is that certain content create content libraries are going to start getting swallowed up because that is where the play is going to be. So many streaming platforms, bro. Honestly, it’s really too many streaming platforms. Joining us now for more, Peter Cipino. He is senior media analyst at Wolf Research. Peter, you just heard that conversation.

Let’s kind of follow up from the stock side. Who do you think ultimately ends up with Warner Brothers Discovery, if anybody, and does it ultimately end up being broken up? Well, in our opinion, it’s up to Netflix. Netflix has the most powerful currency in the industry with its stock, and Netflix has such a huge share of streaming engagement that they can make the minutes and hours owned in the Warner library. They can turn that into dollars better than anybody else in Hollywood. Of course, Amazon is extremely well capitalized and Paramount, Skydance and Comcast have really powerful arguments for taking a run at these assets before they are never available again.

But didn’t, sorry, we’ll get to NBC in a second. Netflix’s co-CEO, Greg Peters, recently say like a couple of weeks ago that they effectively were not interested in Warner Brothers? Yeah, he did say that. And he said in more detail in their last earnings call that it’s Netflix opinion that strategic M&A won’t change the competitive landscape significantly in streaming. I’m sure there’s truth to what he says, but we need to watch Netflix actions more than their statements because they’re inherently really an innately opportunistic entrepreneurial company, and that’s a compliment. Isn’t that what it’s supposed to be? Historically, they’ve said they would never do advertising, and now they’re a massive advertiser growing at 100% annually.

And they said that they would never do sports, and they went out and licensed multiple sports properties over the last few years. I don’t remember that. Things are true at Netflix until they’re not. I’m going to kind of quote Peter Cipino back to Peter Cipino, because this stuff is not only in my world, but it’s a little bit above my world. Also, if that makes sense, Peter. So as you know, in our audience, I think knows CNBC is being spun out with other assets, part of a new company called Versa. What’s left of NBC Universal will remain with Comcast.

You believe that it’s possible. Comcast thus spins off NBC Universal, not Versa. We’re already going VRST the new ticker. Spins off the remainder of NBC Universal, creates a new stock, and then that stock is used to buy Warner Brothers Discovery. Yep. In that scenario, what happens to WBD’s debt? Because the issue is not the quality of the asset. File for bankruptcy with the old company. It’s how much they own it. The old company and then file for bankruptcy. Great question. And yes, we think that there’s a strategic opportunity paired with a financial opportunity and the transaction that you just described that we’ve been writing about for about a year or more in some senses.

Let me tell you what happens sometimes in these companies. So you’ll see companies split up. There’s been plenty of companies that split up certain divisions and that division live on its own, right? We’ve seen car companies split up and then a division live on its own. Or they sell one or a group of car assets. I remember Ford Motor Company, when they were about to face the crisis, one of the things that they sold was the Premier Automotive Group. The Premier Automotive Group included Jaguar. They sold that individually to an Indian company. If I’m not mistaken, they sold Aston Martin and then they sold.

Ah, it was one more. Jaguar, Aston Martin, and something else. And then they spun it off. But sometimes what these companies do is eBay and PayPal split up. But let me tell you what these companies do sometime. So let’s say that you have a company that has a healthy amount of money coming in or a particular part of the business that has a healthy amount of money coming in. And then you also want to buy something, but then you want to spin it off. Or maybe you want to remove the debt from the company. They do a special creative accounting and financing that allows for them to be able to buy a company and then spin it off on its own division, pound on it for assets, steal all of the revenue that comes out of it.

And then they basically set that company up for failure, saddle it with debt. And then that company probably at some point cease to exist. So there is some creative accounting tricks that they use to spin off debt into a separate division, allow for the healthy part of the company to thrive. The part that was dismal, that’s going to go into oblivion. The debt holders are going to be absolutely angry and upset because they know that that part of the company is going to hell. And so you basically saddle that part of the company with debt so that you can then have the healthy side of the company that they then grew to be successful.

Happens all the time. There’s a huge valuation unlock opportunity at Comcast because NBC Universal trades within Comcast is five and a half times EBITDA and seven times earnings, which is really stunning considering Disney, which is not an unrelated asset, trades for close to 12 times EBITDA and a much higher earnings multiple. So in that context, yes, the debt at Warner Discovery is a big deal. Warner announced last December that it had begun a process to restructure its corporation and its debts in order to maximize optionality and prepare itself for the possibility of an auction or a breakup like nobody won’t want a brother’s date dead.

And so we think that they’re in a position to move the debts around in whatever way serve their purposes. A lot of our viewers right now. A.D., what are they going to do with MSNBC? Well, hopefully, probably file for bankruptcy and then we’ll go from there. [tr:trw].

See more of The Millionaire Morning Show w/ Anton Daniels on their Public Channel and the MPN The Millionaire Morning Show w/ Anton Daniels channel.