Liberty Media (LMCA) Q2 2016 Earnings Call

Liberty Media (LMCA) CEO Greg Maffei said he is not interested in getting into the music streaming business despite recent reports that the company was looking to buy Pandora

“Well, I think the overwhelming drive in the digital music space is that you have several in what we consider the stream subscription space is you have several big players who are entering and are likely to further commoditize the market. Spotify did something, like, for the last year, $3.54 of ARPU per month and had 82% or 84% content costs. That sounds like a very hard business to me. And that is with Apple, Amazon, Google entering more deeply and more strongly. And Apple appears to be doubling down on their efforts on music and being more aggressive and obviously have other ways to get paid for their music business through the sale of devices and iTunes and the like. And Amazon I think is a wholly unknown variable that fully hasn’t been realized, in the sense that Prime has an enormous amount of music if you are a subscriber that is embedded in that $99 annual fee. That is surely a commoditization of music. I’m not sure most Prime subscribers understand how much music they have, but as Alexa and Amazon Echo get further out there and that’s a music-discovery device I think that is another hugely disruptive influence on the market. And so, I think that subscription space is very hard. We watch it very carefully. We look at some of the entities that are playing. We look at ways that we can play.”

Optimistic on their stake in Charter TV and their various options to add value now that it has massively improved their scale and household penetration

“I think Charter is changed its permission dramatically from where it was when it was a 4 0.3 million cable video sub company to a 17-plus and 23 million streaming household company. And its ability to impact and drive new kinds of relationships with consumers, including around content, is very different. So I would expect not necessarily that Charter will go out and buy lots of cable networks, but that Charter will think long and hard and is thinking long and hard, about the attractive opportunities that having that scale will create for it. I think you’re going to see people look to always do exclusives and do things that are differentiated and weigh whether they have enough scale to make that work. Examples being DirecTV and the NFL, but there are others out there. And I suspect you’ll see Charter use its improved and scaled relationship with consumers to provide interesting new ways to look at content.”