Latest From Sun Valley: Elon Musk’s Twitter Drama and Mixed Signals About Live Events’ Comeback

As if the births of his ninth child wasn’t exciting enough, Tesla and SpaceX CEO Elon Musk is scheduled to speak Saturday at Allen & Co.’s Sun Valley Media Conference just as his Twitter takeover hits another snag.

OpenAI CEO Sam Altman will interview Musk Saturday morning, according to The Information, though some heavy hitters such as Warner Bros. Discovery CEO David Zaslav have reportedly already left the billionaire summer camp in Idaho. Still, Musk’s interview promises to liven up the annual confab which has been high on potential yet low on big announcements thus far. On Thursday, The Washington Post reported that Musk’s Twitter deal was in “serious jeopardy,” adding an extra kernel of drama to the proceedings.

“I’m not seeing a lot of concern about Musk and Twitter, outside of some clients that think he’s an egomaniac and/or a creep or weird guy,” one entertainment lawyer told TheWrap. “I don’t have a lot of clients that are personally regularly as active on Twitter anymore as they used to be.”

The $44 billion deal hit a speed bump as Musk’s team have raised concerns regarding the amount of data sold to corporate customers and the volume of spam accounts active on the social media platform, the Post reported. The consternation between both sides must make for a very, ahem, unique atmosphere in Sun Valley as current Twitter CEO Parag Agrawal is also roaming the lodge. To be a fly on that wall…

UPDATE 2:38 pm PT: Elon Musk and his advisers have notified Twitter that they are not moving forward with the acquisition.

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Here are a few more takeaways from the conference.

Live events are going great… for now

CNBC reporter Julia Boorstin on Thursday interviewed Live Nation CEO Michael Rapino, who noted that concert-going and ticket sales remain strong despite inflation and recession fears. To be sure, certain live events across sports and entertainment have made a roaring comeback from the bleak early days of the pandemic. Endeavor’s surging quarterly revenue earlier this year was largely credited with the full return of the UFC, Super Bowl and NCAA. In May, StubHub’s Adam Budelli said “This may be the busiest concert season on record.”

Still, not all live events have been as warmly embraced since COVID-related shutdowns lifted. Film festivals such as Toronto and Sundance have gone hybrid, with both in-person and digital access, due to the pandemic. The Cannes Film Festival’s future as a relevant cultural epicenter appears to be waning rapidly. Behaviors have changed as a result. An overall one-two punch of convenience and pricing on the eve of another potential recession threatens to burst the happy bubble.

“For most clients, we’re making plans assuming things will get worse on both the revenue and expense side, just to be safe,” the entertainment lawyer said of live events.

Skeptics point to cost increases as a serious overarching concern, noting fuel and travel as the driving factors while food and catering expenses along with salary increases for crew and staff also play a major role. Despite the relative return of everyday life, COVID continues to be a severely underestimated obstacle in restoring live events “consistently back to normal,” they said.

The bottom line: Enjoy the good times while they last because a “Stranger Things”-esque ticking clock looms large over the industry.

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What’s happening with Paramount Global?

Shari Redstone’s move to remerge Viacom and CBS in late 2019 into the recently rebranded Paramount Global was widely viewed as an effort to prepare the company for sale. Yet despite years of speculation, no clear suitors have emerged and no deal seems imminent.

When discussing merger and acquisition talks coming out of Sun Valley this week on The Business podcast, Puck News co-founder Matt Belloni surmised: “Maybe the Paramount strategy is stay the course, have a streaming service, and milk these linear television networks. So the wheeling and dealing that we thought was going to happen in the next two to three years, maybe won’t.”

Despite a string of box office hits dating back to last summer, a growing portfolio of streaming subscribers across Paramount+ and Pluto TV, and a cascade of cash from CBS, Paramount Global’s share price has dropped 38% over the last 12 months.

Given external economic factors and Netflix’s subscriber losses creating uncertainty in the market, “It’s totally reasonable that Paramount Global is not going to be acquired in this merger wave, but it will be a viable target in the next wave,” David Offenberg, associate professor of entertainment finance at LMU’s College of Business Administration, told TheWrap.

Some acquisition sales are borne out of desperation, but that isn’t the case for Paramount Global, which houses a very manageable $17 billion in debt as of March. “They don’t need a miracle to survive. They’re doing fine and don’t need to be acquired right now,” Offenberg said.

Staying the course appears to be the most viable strategy for the company in the near-term future.

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