2013: The Year in Review

World Screen takes a look back at some of the big media stories of 2013, and what they could mean for the business this year.

An EY survey released at the end of 2013 reported that media and entertainment companies have an overall optimistic view about the global economy in the year ahead. Of the executives surveyed, 68 percent were feeling positive about the economy continuing to rebound this year—a vast improvement on EY's Capital Confidence Barometer: Media & Entertainment survey in 2012, when only 26 percent of executives were feeling upbeat about the prospects for the global economy. EY also reported that the media and entertainment business would outperform major global stock-market indices for the first time in five years, thanks in part to rising digital revenues.

This bullish outlook is expected to drive further M&A activity in the media business this year following a busy 2013. Last year's mega deals included Comcast's acquisition of GE's stake in NBCUniversal and Liberty Global's takeover of Virgin Media. Liberty Global also upped its stake in Holland's Ziggo and is looking to take full ownership of the platform. In addition, it sold off its Chellomedia business to AMC Networks for $1 billion. Vodafone struck a deal to buy KDG, Germany's largest cable platform. Advertising giants Omnicom and Publicis agreed to merge. CBS Corporation became Lionsgate's partner in TV Guide Network. Bell Media finally received regulatory clearance for its Astral takeover (with some conditions, including the sale of TELETOON). Lagardère reached a deal with Vivendi to sell its stake in Canal+. ITV picked up a number of production companies, while Modern Times Group bought into DRG, Novemberfilm and Nice Entertainment. Meanwhile, 21st Century Fox offloaded its stakes in SKY Network Television in New Zealand and Phoenix Satellite Television in China. And Hulu's on-again, off-again auction was finally called off in the summer, with owners 21st Century Fox, NBCUniversal and The Walt Disney Company announcing plans to invest $750 million to expand the online video service.

Continued demands by consumers to access content anywhere, anytime, will help drive further deal activity in the entertainment, media and communications sector, PwC reported in a recent survey. Indeed, digital continued to revolutionize the content business last year, led by streaming service Netflix. Its original programming efforts bore fruit as House of Cards notched up a slew of Emmy nominations and Orange Is the New Black cemented binge viewing as the new normal. Netflix also furthered its international expansion with a launch in the Netherlands and partnerships with a number of pay-TV operators, among them Virgin Media in the U.K.

For legacy cable and satellite platforms, TV Everywhere emerged as a crucial strategy in 2013 as they attempted to stem the cord-cutting tide; indeed, study after study indicated that Millennials are increasingly opting for SVOD or free-streaming options for their content fixes. The rise of the "broadbander" will continue to be an issue for pay-TV platforms this year, as will negotiations with broadcasters and cable networks. Among the biggest stories of 2013 was Time Warner Cable's prolonged spat with CBS Corporation that left millions of customers in key cities like New York and Los Angeles without the CBS network and Showtime, among others, for weeks. Another issue that is looming large in the pay-TV industry in the U.S. in 2014 is a la carte pricing. In May, Senator John McCain introduced a bill in the U.S. Congress to encourage a la carte packages from pay-TV platforms, allowing customers to select individual channels they want to subscribe to without having to sign up for bundled packages.

For free-TV broadcasters, meanwhile, all eyes remained on Aereo, which continued its American expansion throughout 2013 despite legal action from a group of networks. As the year came to a close, the Barry Diller-backed service that provides TV signals online for free said it was ready for the Supreme Court to hear the appeal brought by the consortium of broadcasters.

Broadcasters are also anxious for improved ratings that take into account all the viewing that is taking place off the linear screen. Nielsen announced in October that beginning in the 2014-2015 season, it would include mobile viewership in its ratings.

All this online viewing did, naturally, take its toll on Blockbuster, which ended its U.S. retail and by-mail DVD distribution operations. The future, by all accounts, is in smart TVs, which are expected to account for half of the TV-set market next year, and connected devices like Apple TV and Roku.

The year also cemented the trend of multitasking while watching TV—a Deloitte survey early in the year revealed a 160 percent growth in the number of "digital omnivores," consumers who own a trio of tablets, smartphones and laptops. Another study in 2013 found a direct link between Twitter chatter and TV ratings.

2013 was also marked by the Greek government's closure of pubcaster ERT, setting off a firestorm of protests, and the on-again, off-again European airport strike that induced travel panic in thousands of international media executives at the end of MIPCOM.

The year also saw a wave of senior-management shakeups in the U.S. and around the world. Tony Hall took the reins at the BBC. Kevin Tsujihara landed the top job at Warner Bros., succeeding Barry Meyer. Bruce Rosenblum, who many expected would be chosen as Meyer's successor, soon left the studio, landing at Legendary Entertainment a few months later to run its nascent television division. Neil Berkett left Virgin Media after the Liberty Global takeover and was succeeded by News Corp. veteran Tom Mockridge. Nancy Dubuc took over from Abbe Raven at A+E Networks. Mark Hollinger stepped down as international chief at Discovery Communications, a post that is yet to be filled. John K. Martin this year takes over from Phil Kent at Turner Broadcasting. Former Endemol exec Marco Bassetti landed at Banijay as CEO. David Frank left Zodiak Media, with Marc-Antoine d'Halluin now running the company. David Ellender exited FremantleMedia just a few months after a significant restructuring at the RTL Group-owned firm. Jens Richter is slated to fill the post of CEO of FremantleMedia International in 2014 after his contract at Red Arrow International ends. At NBCUniversal, international head Jeff Shell moved up to become chairman of Universal Filmed Entertainment Group, with Kevin MacLellan filling the post vacated by him.

In the run up to this year's World Cup in Rio, 2013 also saw lots of activity in the sports business. FOX International Channels, for one, spent much of the year ramping up its FOX Sports brand around the world. Al Jazeera Sport continued to spend heavily to shore up broadcast rights to marquee events in the Middle East and invest in its international business beIN Sports. Another aggressive player in 2013 was BT, whose significant moves included acquiring ESPN's channels business in the U.K. and Ireland.

All of these stories, and more, were covered by World Screen's portfolio of online newsletters last year, which we expanded with the launch of TV Kids Daily and TV Drama Weekly. Also new for us in 2013 were new print editions in March and September and a brand-new publication, World Screen Reports, made just for the iPad. Look out for more new services from us in 2014 as we continue to bring you the latest news and analysis from the world of international media.