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Listen: What a Recession Could Mean for the Media Business

With many economists predicting a recession could hit the U.S. economy in the coming months, the media business could be in for a rough ride. But there’s a lot more roiling this sector right now that must be taken into account to understand what the future might bring.

On the latest episode of the Variety podcast “Strictly Business,” S&P Global Ratings senior director Naveen Sarma offers a wide-ranging assessment of the content industries. If the threat of economic slowdown wasn’t enough of a potential problem, the pending launch of new streaming services from Disney, WarnerMedia, and NBCUniversal could compound the challenges facing these companies.

Listen to the podcast here:

“A lot of these companies are going to see a significant degradation in their credit quality not only from the launch of new services but layer in a recession that could exacerbate that problem,” said Sarma, who has covered the media and telecom worlds over the past two decades.

Sarma believes it won’t be smooth sailing for ventures like Disney+, but the companies need to persevere.

“What Disney is doing is very brave,” he said. “And they’re going to stumble and fall. And having the vision to say, ‘We’ll stumble and fall but we’ll go back and experiment again, and we’re willing to take the hit for 3-4-5-whatever number of years,’ is very courageous on their part.”

Strictly Business” is Variety‘s weekly podcast featuring conversations with industry leaders about the business of entertainment. Listen to the podcast below for the full interview, or check out previous “Strictly Business” episodes featuring HBO chairman/CEO Richard Plepler, Discovery CEO David Zaslav, and TV star Tyra Banks. A new episode debuts each Tuesday and can be downloaded on iTunes, Spotify, Google Play, Stitcher, and SoundCloud.

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