All OTT enthusiasts must already be aware by now that Warner Bros. Discovery will combine HBO Max’s scripted entertainment content with Discovery’s reality / unscripted / non-fiction shows. And all this will be showcased in its brand-new streaming platform titled ‘Max’, which is set to launch later this year on 23rd May.
But WBD’s revamping announcement was followed by a decline of almost 6% in the stock price of the entertainment conglomerate. Most of us might have inferred that WBD’s stock decrease was related to the aforementioned revamping announcement. It’s quite likely but that may not be the only reason.
Interestingly, on Wednesday, it was not just WBD whose stocks witnessed a fall in the US. Popular entertainment and streaming companies including Netflix, Disney and Paramount Global also saw their stock prices fall by around 2%, 2.5%, and 3.3%, respectively. So, what could be the reason behind the fall in these stock prices on the same day?
Let us inform you that in an interview conducted yesterday with Warren Buffet by CNBC, the veteran investor and business magnate was asked about his new investment in Paramount. And his reply did not seem very positive for the entertainment and the streaming industry.
The hotshot Berkshire Hathaway CEO remarked that “Streaming that, you know, it’s not really a very good business. And, you know, it the people in entertainment that make lots of money, the shareholders really haven’t done that great over time”
When a highly respected investor of the stature of Warren Buffet makes a rather adverse comment about the entertainment and streaming business, it potentially influences the common investor’s way of thinking.
So, the recent stock price declines for biggies like Netflix, Disney and Paramount might be related to the recent remark by the legendary investor. The stock market works in mysterious, complex, and unpredictable ways. So, as far as the Warner Bros. Discovery share price decrease is concerned, it might have happened because of a combination of the revamping announcement and Mr. Buffet’s recent critical remark.