LightShed Partners analyst Richard Greenfield joins The Final Round to discuss the state of media and streaming, including Quibi and NBCUniveral’s Peacock, amid the coronavirus outbreak.

Video Transcript

DAN ROBERTS: Hey, Rich, Dan Roberts here. Thanks for coming back on.

RICHARD GREENFIELD: Thanks.

DAN ROBERTS: Let's end this way just briefly. I know we're talking about Disney, and obviously, the one silver lining has been Disney Plus and the good number there.

RICHARD GREENFIELD: Yeah.

DAN ROBERTS: Netflix been doing well. Obviously, everyone is at home and they're watching streaming content. So you would think may be a good time for Quibi to launch, which just launched. Of course, it's only on phones. They're going to have to get it on TVs fast. And then today, NBC Peacock to launch, at first, just to Comcast Xfinity subscribers. But there's negatives on both sides for these offerings.

And it's hard to believe in Peacock's case, that that many people are going to add yet another, unless they feel they've exhausted some of the other platforms. So just quickly, can you give us your thinking on kind of the prospects for success in the next few weeks or months for both Quibi and Peacock?

RICHARD GREENFIELD: Well, let's step up to a higher level for a second. So, Dan, are you, maybe Dan and Jennifer. Are you both cable satellite subscribers right now?

DAN ROBERTS: No.

RICHARD GREENFIELD: Neither of you?

JEN ROGERS: I have cable.

RICHARD GREENFIELD: OK, so you have cable.

DAN ROBERTS: I'm YouTube TV, Rich.

RICHARD GREENFIELD: OK. So you're a $50 a month. She's a more expensive subscriber. But you both have linear television at $50 to $100 a month before broadband charges. But you're paying $50 to $100 a month.

DAN ROBERTS: Yep.

RICHARD GREENFIELD: I think what we're learning though is, that you've gone from what was probably before, Dan, $100 service, you're now paying $50. Jennifer probably moves from that $80, $90, $100 service down to $50. If not, she realizes she's not a huge sports fan and she can actually live without the big bundle, and then she's cut her bill from $100 down to $0.

And so I think the question is, as you think about all these entertainment options, these are all, you can choose, right? Like you can sign up for Showtime to watch "Homeland," which just came out, and I've loved this season. But then I can cancel the minute it's over. I don't need to be a "Homeland," I don't need to be a Showtime subscriber for the full year. You don't need to be a Peacock. It is point and click. I can cancel Netflix with a click of a button. I don't think Netflix has too many subscribers who don't want the service. It's not like an ESPN that you were forced to take it as part of a big bundle whether you wanted to pay that $9 effectively for ESPN or not.

So I think the real answer is, you're cutting your existing video bill pretty dramatically. Even if you're not a cord cutter, you're shaving, like you are, and you're saving $30, $40, $50 a month. You're going to redeploy that into other forms of entertainment. Not just video, but let's just say in this case, will things like Peacock and Quibi and HBO Max.

I mean, HBO Max is the easiest, right? It's the same price as the old HBO, and you just get a lot more for it. Peacock, if you're a Comcast subscriber, you're getting for free. Quibi, if you're a T-Mobile subscriber, you're getting for free. If you're a Verizon Wireless customer, you're getting Disney Plus for free. I'm a T-Mobile subscriber, I get Netflix for free.

I mean, the reality is, the actual wallet that's kind of available, is expanding pretty dramatically as people reduce their spending on the bundle. And on top of that, they recognize that just like the apps on your phone, if you don't want an app on your phone, what do you too? Maybe sometimes you just leave it there and never go back to it. But it's pretty easy to delete an app. It's pretty easy to sign up and cancel things on your phone. It's not like getting on phone.

I mean, think about what you used to have to do. You'd call up Comcast or Charter, Time Warner Cable, back in the day, and you would be tortured for hours. There's that famous video clip on YouTube of that person spending two hours trying to cancel their Comcast service. Canceling your Showtime or canceling your, whether it's Quibi or whether it's Peacock, it's literally the click of a button.

And so I think the honest answer is, people are going to have a lot more of these subscriptions than people are currently expecting, because you're going to manage in and out. And plus, you're redeploying spending from what you are spending on your big video bundle, especially if you're not a sports fan, and you're good to subscribe to a lot of these things. I mean, look. They'll be ones that are core services like Netflix. But I actually think you're going to try a lot of these things. And the ones with good programming will capture subscribers.

MYLES UDLAND: All right. We'll have to leave it there. Rich Greenfield with LightShed. Next time we'll do a sports rights fees and how the next re-up cycle is going to be. We'll get into that at a later date. Rich, thanks for joining us today, we'll talk to you soon.

RICHARD GREENFIELD: You guys are great. Thank you.