TEK2day Podcast

Cinemark's new subscription service - Movieclub - a good start, however bolder steps are required.

Movieclub subscription service:

$8.99 per month;

1 2D movie per month per subscriber;

Unused tickets roll over and never expire;

Members may share unused allocations with other members and non-members;

No online fees;

Additional tickets may be purchased at member price of $8.99;

20% discount on concessions;

Notes, Assumptions and Our Advice to Theater Owner/Operators:

- Avg ticket price for a Friday/Saturday night 2D movie = $11. Therefore Movieclub subscription is approx. an 18% discount per ticket (before the 20% concession discount);

- Positive for Cinemark in that this offering will increase Cinemark's revenue visibility, albeit at discounted prices;

- My view is that theater owner/operators need to take bolder steps to further mitigate the risk associated with the mega-trend that is in-home viewing (which applies downward pressure to theater-owner revenues). Our advice: make the capital investment and partner with movie studios and technology companies to offer premium services such as Augmented Reality ("AR") and Virtual Reality ("VR") in-theater experiences.

Disruption will come from below (i.e. start-ups) that come to market with new business models (peer-to-peer for example). Startups that embrace technology and creativity.

Change ultimately will be driven by consumers. Consumers will be empowered as personal health data becomes readily available through new technologies such as the Apple Watch and various health data apps.

Local care centers like MedExpress (now Optum) and online marketplaces owned and operated by Amazon, Walmart and the like are the future.

These marketplace changes combined with de-regulation/ forced competition (wishful thinking?) will eliminate the bloat and the "wag the dog" administrative state forced upon us by the political class. Only through deregulation will the insurance companies be forced to compete for our business. Only then will premiums come down as insurance oligopolies are replaced with a competitive market place across state lines and nationally. Competition will force drug prices down as well.

We will only maximize the potential offered by tools such as the Apple Watch and enjoy the benefits of providers with new business models if we eliminate regulations put in place by politicians whom have been bought off by lobbyists employed by healthcare insurers and large pharmaceutical companies. If we don’t change the status quo – as citizens our tax bill will only grow as we continue to subsidize a system that benefits insurance carriers and pharmaceutical companies at our expense.

Time for a CEO change and Board swap out at IBM. Neither IBM's CEO Ginni Rometty nor IBM's Board understand the nuances of crafting a story for Wall Street nor executing a strategic M&A program to offset the negative impact to IBM's revenue as a result of the strategic shift to recurring revenue products & services.

Our brief recap of GM's Autonomous Vehicle ("AV") event.

GM's 11-30-2017 slide preso: https://drive.google.com/open?id=1GaYoCqRmB_tH6wJY_7hCPPgHkZinkFtW

- Amazon's straight-through-processing ("STP") retail experience provides the company with an edge vs. Google in the AI war.

- Here is the link to the CEORater CEO Compensation study we referenced in the podcast: https://drive.google.com/open?id=1dJt4d7wenI4ibrH3_Csvs2xzS_w9Xt7K

-Here's the link to GM's investor day: https://www.gm.com/events/5265893.html

The Justice Department ought to let AT&T's proposed acquisition of Time Warner go through without forcing the divestiture of content businesses such as CNN. Follow our sister publication TEK2day.com where you may read in-depth analysis across Technology, Media, Telecom ("TMT"), the Capital Markets, Corporate Governance and Entrepreneurship.

Podcast about our Autonomous Vehicle report in which we state that AI-Powered Personalization wins the day. Read more here at TEK2day.com: https://tek2day.com/2017/11/24/autonomous-vehicle-ecosystem-winners-and-losers/

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Our word of advice to CEOs & Boards - disclose cyberbreachs when you learn of them. Sitting on a cyberbreach is not an option.

We cover:

1.) Autonomous driving teaser..

2.)Perhaps Microsoft (MSFT) ought to acquire Anaplan and other SaaS/cloud Financial Management tools to create an upgrade glide path for Excel? We think so. Infor would do well to follow a similar M&A path.

3.) Uber the latest company to suffer a publicized data breach. We sound like a broken record regarding the subject of Cybersecurity.

4.) Meg Whitman steps down at HPE. IT Services and Technology-Enabled Services companies would be wise to acquire Enterprise Software companies. Such acquisitions would be margin accretive, EPS accretive, would bolster valuations and perhaps most importantly would begin to move the Services vendors out of the commodity services space and into a sector where they would own IP.

We favor deregulation as it will spur innovation.