Streaming’s Biggest Rivals Just Became Allies in Washington

Streaming’s Biggest Rivals Just Became Allies in Washington

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Netflix, Inc. (NASDAQ:NFLX), Amazon.com, Inc. (NASDAQ:AMZN), and Alphabet Inc. (NASDAQ:GOOGL)'s YouTube compete aggressively for subscribers, ad revenue, and, increasingly, sports rights. On September 14, the three put aside their rivalry to form a new lobbying group aimed at representing the streaming industry as a single, undivided voice in Washington.

The New Coalition

The Streaming Access and Choice Alliance, or SACA, debuted on September 14 with Amazon, Netflix, and YouTube as founding corporate members. It's led by TechNet, a trade association that describes itself as a national, bipartisan network of technology CEOs and senior executives that promotes the growth of American innovation. Mike Ward, TechNet Senior Vice President of Federal Policy and Government Relations, stands at the helm. Ward defined the group's mission as consumer flexibility: Americans want more content options and flexibility in how and where they watch programming, including sports and other live events, and he argued that the streaming industry and its customers deserve a dedicated voice advocating for policies that promote innovation.

Why Now

The timing is closely related to an ongoing regulatory struggle. Earlier this year, the Justice Department opened an antitrust investigation into NFL broadcasting practices, while the FCC separately sought public comment on developments in the sports-broadcasting marketplace and their impact on consumers and broadcast. FCC Chairman Brendan Carr has explicitly questioned whether leagues can continue benefitting from the Sports Broadcasting Act's antitrust exemption as more games move from traditional broadcast television to streaming services.

That backdrop explains why three companies that spend massive sums outbidding each other for sports rights, Amazon's NFL "Thursday Night Football" package, Netflix's expanding live sports schedule, which includes NFL games, and YouTube's NFL Sunday Ticket, have a real shared incentive to present a united front. If the legal or regulatory framework governing leaguewide sports-rights packages changes, it could alter how those rights are structured, negotiated and distributed, affecting all three platforms to varying degrees.

Hedge Fund Positioning

The institutional positioning among the three companies has recently shifted in different directions. Amazon.com, Inc. (NASDAQ:AMZN)'s hedge fund holdings increased from 353 funds in the first quarter to 369 in the second, cementing its position as one of the most commonly held companies among institutional investors. Alphabet Inc. (NASDAQ:GOOGL), Google's parent company, witnessed a comparable increase, from 265 funds to 275. Netflix, Inc. (NASDAQ:NFLX) moved in the opposite direction, with hedge fund ownership falling from 144 to 121 over the same period, a notable drop that predates the emergence of this coalition but suggests some institutional caution.

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