Evaluate Factors Before Renewing TV-Series Contracts

Quick Overview

Capital One analytics case on TV-series renewal and sale decisions, covering cost-revenue profit, qualitative factors, viewer value, opportunity cost, NPV, profitability actions, and keep-versus-sell economics.

Evaluate Factors Before Renewing TV-Series Contracts

Company: Capital One

Role: Data Scientist

Category: Analytics & Experimentation

Difficulty: medium

Interview Round: Onsite

##### Scenario You are advising the CEO of a TV-series company on whether to renew a 2-year contract and evaluate options for two productions: The Analyst (Series A) and Shark Bank (Series B). ##### Question Which qualitative and quantitative factors would you assess before renewing a new 2-year contract for the shows? Given cost-revenue data for The Analyst and Shark Bank, calculate each show’s total 2-year profit. Propose data-driven actions that could increase the profitability of The Analyst. If the company is considering selling The Analyst, what additional information would you request before making the decision? Assume after 2 years The Analyst’s incremental profit is $0 and Shark Bank earns $22 M. Selling The Analyst loses 1.5 M viewers worth $32 each. What is the minimum sale price that makes the company indifferent? Another studio offers $60 M for The Analyst. Based on your analysis, would you recommend selling? Explain. ##### Hints Estimate cash flows, lost-viewer value, opportunity costs, and compare NPV across keep-versus-sell scenarios.

Quick Answer: Capital One analytics case on TV-series renewal and sale decisions, covering cost-revenue profit, qualitative factors, viewer value, opportunity cost, NPV, profitability actions, and keep-versus-sell economics.

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Jul 12, 2025, 6:59 PM
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TV-Series Renewal and Divestiture Analysis

You are advising a CEO on whether to renew a two-year contract for two TV series:

  • The Analyst (Series A)
  • Shark Bank (Series B)

You have or can request cost and revenue data for each series.

Constraints & Assumptions

  • Separate strategic/qualitative factors from quantitative profit and cash-flow analysis.
  • Use the provided cost-revenue data when available.
  • For the keep-versus-sell question, include lost viewer value and opportunity cost.
  • State any assumptions about timing, discounting, and whether figures are incremental.

Clarifying Questions to Ask Guidance

  • What revenue streams are included: ads, streaming, licensing, international rights, syndication, merchandise, or subscriptions?
  • Are costs fully allocated or incremental?
  • Are viewer values gross or contribution margin?
  • Does selling The Analyst affect Shark Bank or other portfolio titles?
  • Are there contractual restrictions, talent obligations, or brand effects?

What a Strong Answer Covers Guidance

  • Renewal factors: audience trends, retention, demographics, revenue, costs, margins, rights, marketing efficiency, brand value, portfolio fit, uncertainty, and replacement options.
  • Profit calculation for each show over the two-year horizon using total revenue minus total costs.
  • Actions to improve The Analyst profitability, such as pricing/licensing, marketing targeting, episode budget optimization, distribution windows, retention campaigns, or format changes.
  • Additional sell-decision information: incremental viewer value, buyer restrictions, future upside, strategic fit, replacement slate, legal terms, and NPV.
  • Indifference sale price: account for lost viewer value from selling The Analyst and compare against keeping economics.
  • Recommendation on a $60M offer based on incremental economics, uncertainty, and strategic constraints.

Follow-up Questions Guidance

  • How would you value viewers if they also watch other shows?
  • What if The Analyst has zero short-term profit but large franchise option value?
  • How would you incorporate uncertainty in renewal forecasts?
  • What data would make you change the sell recommendation?
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