What’s Up? (April 17-23)
A Bad Week for CNN + and Netflix
After pouring tens of millions of dollars into a nationwide marketing campaign, big-name stars and hundreds of new employees, CNN announced Thursday it was shutting down CNN +, its weeks-old streaming platform. Executives at Discovery, CNN’s new owner, were said to be concerned about underwhelming interest from subscribers. The news fueled questions – particularly after Netflix’s disastrous earnings report last week – about the longer-term outlook for streaming services. Netflix said on Tuesday that it had lost 200,000 subscribers in the first quarter and expected some two million more to leave the platform over the next three months. It was the first time in a decade the company lost subscribers, and its shares plunged 35 percent.
Florida Takes On the Magic Kingdom
Escalating its tangle with Disney World, Florida lawmakers advanced a measure to strip the theme park of a privilege that has allowed it to effectively self-govern its vast property in the state for more than 50 years. Republicans, who hold majorities in both chambers of the legislature, were spurred on by Gov. Ron DeSantis, who cleared a path for the lawmakers to vote on bills that would eliminate special tax districts created before 1968. He signed the legislation on Friday. The move is widely seen as retaliation for Disney’s opposition to what some call the “Don’t Say Gay” law, which limits instruction on gender and sexuality in some elementary school grades.
Masks Drop on Public Transportation
Many of the country’s major airlines dropped their mask mandates after a federal judge appointed during the Trump administration struck down the requirement for airplanes, trains, buses and other public transportation. Airlines including American, Delta and United, which have had to deal with unruly passengers who refused to comply with the mandate, swiftly announced they were no longer requiring masks, and Delta later said it would allow people who were placed on its no-fly list for defying its previous mask policy to fly once again. The Biden administration said it would appeal the ruling.
What’s Next? (April 24-30)
An Economic Slowdown
The gross domestic product report for the first quarter, which will be released on Thursday, is expected to show that economic growth in the United States slowed significantly in the first three months of the year. The slowdown is partly because of the Omicron wave, which kept many Americans at home in January and disrupted service industries and manufacturing. The report will also help show to what extent inflation – which reached 8.5 percent last month – may be holding back consumers as well as the broader economy. The GDP data from the last quarter of 2021 illustrated how inflation can obscure how much of the country’s economy is recovering from the depths of the pandemic. Output in the United States still had not been caught up to prepandemic levels, last quarter’s report showed, because consumers’ dollars are worth less than before.
Elon Musk’s Money Moves
Twitter is releasing its quarterly earnings report this week, and a significant part will probably deal with Elon Musk’s determined efforts to acquire the company and give investors an idea about whether his offer is sufficient. In an attempt to make the company’s board take his offer more seriously, Mr. Musk said on Thursday in a federal filing that he had commitments worth $ 46.5 billion – a mix of debt and cash – to finance his bid. The documents also showed that Mr. Musk was considering a hostel takeover, which would involve bringing the bid directly to shareholders. Twitter’s board has already made provisions to thwart such a move, adopting a so-called poison pill that would block Mr. Musk from buying an unlimited number of Twitter shares.
A Big Bet on Gaming
Activision Blizzard shareholders will vote Thursday on whether to merge with Microsoft. For Microsoft, which announced in January that it wanted to acquire the video game company for almost $ 70 billion, the deal would serve at least two major purposes: In the long term, it plants a flag in the metaverse, the virtual world where tech companies like Facebook are placing big bets. In the shorter term, the acquisition helps Microsoft get ahead of its rival Sony in the race for gamers’ attention and dollars and keeps the company competitive with Amazon and Google, which have also entered the gaming market. If Activision shareholders approve the deal – and they are likely to do so – it still faces the scrutiny of antitrust regulators.
Airlines expect a travel boom in the coming months. Workers at an Apple store in Atlanta filed a petition to hold a union election. The Federal Reserve is weighing a larger-than-usual increase in interest rates, of half a percentage point, for its May meeting.