Media & Entertainment Transformation & the Strategic Imperative

The media and entertainment sector is undergoing transformational change. While the appetite for total media consumption has never been greater and new windows and platforms offer the promise of media's future paradigm, the transition toward the new steady state is largely untested and will likely require wrenching change.

For example, the past five years have shown a clear migration toward media consumption monetized via outright purchases (collectively grown at 2.6% annually) rather than ad support which has shrunk by 1.9% annually.

Thus, the new industry imperative is minimizing volatility and maximizing value in each segment.

As of mid-September, the collective stock market performance of 94 media companies has declined 9.9% in 2008, roughly average for all industries during that time period.

The average, however, masks substantial differences in each of the 94 individual media companies, whose stock performance ranged from a 95% loss for a transitioning Yellow Pages publisher to a 42% gain for a specialized radio and TV news provider. What can a media company do to reach and maintain the high end of that performance range?

Because so much is at stake, understanding these changes and positioning oneself to maximize the transformation is imperative to determining the winners and losers. And with the current market environment where liquidity is at a premium, making decisive strategic choices with swift follow through and an explicit, detailed plan that can be communicated internally and externally is more important than ever before.

Since 1984, KGI has assisted many media and entertainment companies. With twenty years of turnaround and restructuring experience, KGI is uniquely positioned to deliver meaningful impact in numerous media and entertainment sectors, including film, cable, broadcast television, newspapers, magazines, new media and much more.

KGI's restructuring and turnaround offerings include but are not limited to:

  • Identification and sources of shareholder value creation and destruction at the division, business unit or program level
  • Right sizing of employment base, including matching resources to future value creation
  • Asset sales (e.g., business units, stations, content libraries, IP, real estate, etc.)
  • Expense reduction and/or matching to revenues (both fixed and variable)
  • Merger and acquisition advice and strategy
  • Pricing Strategy
  • Selective investment for future growth
  • Managing the growth/return tradeoff
  • New capital sourcing
  • Restructuring of existing debt and equity

We welcome the opportunity to share more about what we can do for you in the media and entertainment sector.

Whether a Company is struggling financially or on the cusp of breakthrough growth, KGI can help. Our seasoned experts work alongside management to solve complex cash flow issues, operational challenges and other business crises. If liquidity or sale is needed, KGI provides a powerful combination of services and expertise to achieve outcomes that cannot be duplicated by other standalone consulting firms.