I'm pleased to present the 184th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. This week we discuss the cloud's impact on video delivery. First, I share thoughts on Comcast's X2 platform, unveiled this week, in which the cloud plays a central role.
Colin notes that with Comcast's approach, there is still a fair amount of client-side processing happening, so it's not fully capitalizing on the cloud just yet. Colin draws a distinction between Comcast's approach and that of ActiveVideo Networks (which I recently wrote about), whose CloudTV moves all the processing to the cloud, allowing services to run on older set-top boxes and newer CE devices.
It's still early days in the cloud's deployment with different models at work, but there's no question it's going to become a bigger part of the video delivery landscape.
Listen in to learn more!
Click here to listen to the podcast (19 minutes, 43 seconds)
At the Cable Show yesterday, Comcast's CEO Brian Roberts showed off "X2," the latest generation of its cloud-based X1 entertainment platform. Beyond a slew of UI improvements, X2 offers at least three things that are very important and I believe, indicative of key future trends in video delivery: cloud-based DVR, an inexpensive IP set-top box and a unified cross-platform experience.
Digitalsmiths is taking video metadata to the next level, unveiling its Unified Data Service, a one-stop shop for pay-TV providers to access multiple, pre-integrated data feeds.
Digitalsmiths CEO and co-founder Ben Weinberger explained to me last week that as pay-TV operators have rolled out their own on-demand services and video apps, they're striving to make them as rich as possible. This includes adding the kind of related data (e.g. actor, cast info, schedules, merchandise, etc.) and social tools (e.g. Twitter/Facebook feeds, etc.) that are commonly found in entertainment-oriented web sites and apps.
If you've recently visited the guide provided by your pay-TV operator, chances are you were pretty underwhelmed. Never known for its usability, the typical guide increasingly looks like a relic from another age, as rich apps and online video services have continued to raise the bar on program discovery.
One company looking to change all of this is ActiveVideo Networks, which leverages cloud-based processing to deliver sophisticated HTML5 experiences to even the most humble, low-end digital set-top boxes. The result is a pivotal change in bringing pay-TV providers' guides up to par, cost-effectively and with low operational impact. Late last week, ActiveVideo gained momentum for its approach, announcing that big U.S. cable operators Charter and Cablevision are using its "CloudTV H5" platform for cloud-based UI and interactive applications, respectively, and that Sumitomo will help roll out the platform in Japan and Asia.
Topics: ActiveVideo Networks
I'm pleased to present the 182nd edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. Apologies in advance for audio quality this week as Colin was dialing in from a London hotel room and his audio level is low.
In today's podcast Colin leads off by sharing key takeaways from Cisco's latest Visual Networking Index (VNI) that was released this week. Cisco has been forecasting strong online and mobile video growth for years and this version continued the trend. Colin also wrote about it here.
Then we move on to discussing BlackArrow Linear, a new product announced yesterday that enables pay-TV operators to dynamically inserts ads into live and linear video viewed on devices. Colin and I agree that it should move the TV Everywhere ball forward, helping programmers monetize better and therefore help catalyze broader video distribution.
Listen in to learn more!
Click here to listen to the podcast (16 minutes, 54 seconds)
Advanced ad technology provider BlackArrow is unveiling "BlackArrow Linear" this morning, which enables pay-TV operators to dynamically insert ads into live and linear streams viewed on connected and mobile IP devices. BlackArrow has traditionally focused on video-on-demand streams to TVs.
The move is significant because BlackArrow Linear broadens pay-TV operators' flexibility to offer and monetize live and linear TV Everywhere streams. TV Everywhere began as an on-demand only offering, but a move is now underway to expand into live as well. In just the past month, both ABC and Turner have announced linear streaming to devices (more here and here), with TV Everywhere authentication. While I have questioned how broad the appeal of linear is in an age of time-shifting and ad-skipping, I believe it will become widely adopted by other broadcast and cable networks over the next 12 months as they race to embrace devices.
The explosion of online video viewership is presenting pay-TV operators and broadband ISPs with big challenges and opportunities managing all of the increased traffic across their networks. To help address these, Akamai is introducing new capabilities in its Aura Network Solutions line of operator content delivery network (OCDN) technologies. The goal is to help operators deliver traffic more flexibly and cost effectively while also opening up potential new business models such as TV Everywhere.
New industry data compiled by Leichtman Research Group shows that broadband ISPs that account for 93% of the U.S. market added over 1.1 million subscribers in Q1 '13, nearly 6 times the 194K pay-TV subscribers that were added in the period by pay-TV operators that account for 94% of the market.
Broadband subscriber additions have outstripped pay-TV's for years, but the 6x ratio is more than double the average of 2.8x from the prior 2 years. The 194K pay-TV additions in Q1 were down 56% vs. the 445K added in Q1 '12, while the 1.1M broadband additions were off 15% from the 1.3M in each of the prior 2 years.
On the surface the data suggests that cord-cutting - a shift from viewing video via pay-TV to via broadband - may finally be taking hold. But while LRG's Bruce Leichtman has indeed found an uptick in his calculations of cord-cutting (up from .2% of U.S. homes to .4%-.5%), he sees a far more nuanced picture of what accounted for Q1's swing, plus lots of uncertainty going forward.
Yesterday's victory by Aereo in federal appeals court is certain to have at least one consequence: it will put retransmission consent fees into the spotlight. For those unfamiliar with "retrans" as it is known, these are fees that broadcast TV networks and stations have negotiated from pay-TV operators. Much like the fees pay-TV operators pay to carry cable TV networks (e.g. MTV, USA, ESPN, etc.), retrans allows operators to carry broadcast networks.
Retrans fees are already a billion dollar plus revenue stream for broadcasters and by some estimates, could be a multiple of this in several years. Broadcasters see the payments as vital to keeping them on parity economic footing with cable networks. Conversely, operators see retrans as a broadcast subsidy, effectively inflating their already bloated programming costs. Retrans has been at the heart of most of the blackout battles between broadcasters and operators over the last several years.
I'm pleased to present the 173rd edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. This week we focus on the rising cost of content to pay-TV operators and the rising quality of content found online.
In a post yesterday, Colin validates pay-TV operators' complaints about programming costs, noting, for example, that at Comcast they rose from 34% of video revenue in '08 to 40% in '11 (at Time Warner Cable they were 41% and at DirecTV they were 45%). As we discuss, these escalating costs are eating into operators' profit margins as subscriber rate increases haven't kept pace. As VideoNuze readers know, sports is a major culprit in all of this, though entertainment networks have raised their own rates as well.
Against this backdrop, the quality of content available online is improving markedly. For example in just the past couple of weeks, we've seen Netflix announce another new series, with the producers of The Matrix films and Babylon5, Amazon Studios announce new shows "Betas," "Zombieland" and "Sarah Solves It" and Crackle a second season of "Chosen." Further, anime network Crunchyroll disclosed it's now up to 200K paying subscribers, TheBlaze (Glenn Beck's online video network) is raising $40M. Even the BBC, one of the most traditional TV networks, announced it will be premiering shows on its iPlayer.
In short, the quality of programming online is getting better all the time, while the cost of content to pay-TV operators is escalating, in turn putting pressure on subscriber rates. All of this means viewership patterns are bound to change and with the broader video industry.
Reminder: sign up for "Sizing Up Apple TV" a free video webinar, next Tuesday, April 2nd featuring Brightcove's Jeremy Allaire and me.
Listen in to learn more!
Click here to listen to the podcast (18 minutes, 57 seconds)
Flipping through yesterday's Best Buy circular, I noticed an ad (see below), which I believe is indicative of the type of pitches that are going to become increasingly prevalent to prospective cord-cutters and cord-nevers. The ad offers a packaged discount to an over-the-air ClearStream HD antenna from Antennas Direct with a TiVo Premiere and highlights logos from Netflix, Hulu Plus and Pandora. While the ad doesn't explicitly say "Dump your expensive pay-TV service now!," it has several key messages that might as well.
I'm pleased to present the 171st edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. Leading us off today, Colin digs into Nielsen's new "zero-TV" homes data, part of its Q4 '12 Cross-Platform report. When Colin crunches the numbers, he concludes that the U.S. pay-TV industry may have lost 1.1 million subscribers last year, who moved into the zero-TV category. That would be above other estimates, which range from flat to down about 500K.
Of course one of the industry's key initiatives to add value has been TV Everywhere, and on that front, there were refreshingly candid admissions this week from both David Levy, head of Turner's sales, distribution and sports, who said he was "embarrassed" at TV Everywhere's progress, and Lauren Zalaznick, NBCU's chairman, entertainment and digital networks, who said it's too confusing. Both are right, and there are other reasons as elaborated in the recent Ultimate Guide to TV Everywhere (free download).
Contributing to the pressure on pay-TV providers is the ever-expanding range of quality content available online, and 2 more efforts surfaced this week, Conde Nast's new digital video network, and VEVO TV, a 24x7 music video network.
Separate, Colin has released his excellent new white paper, "Second-Screen Apps for TV" (free download here)
And a reminder to sign up for "Sizing Up Apple TV" a free video webinar on April 2nd featuring Brightcove's Jeremy Allaire and me.
Listen in to learn more!
Click here to listen to the podcast (20 minutes, 42 seconds)
Binge-viewing will get another big bounce when Comcast holds its first-ever "Watchathon Week" March 25-31, allowing Xfinity TV subscribers to access over 3,500 episodes from 100 TV series on 30 different premium, ad-supported cable and broadcast networks. All VOD-enabled Xfinity subscribers will be able to access the programs, via Xfinity On Demand, Xfinity.com and the Xfinity TV Player app on iOS and Android devices.
Nielsen's new Q4 '12 Cross-Platform Report has identified just over 5 million "zero-TV" homes in the U.S., as Nielsen calls them, an increase from 2 million in 2007. Not to be confused, these aren't homes without TVs (75% of them still have at least one); rather they are homes that don't receive programming over traditional platforms (i.e. pay-TV and broadcast). Instead, almost half of them (48%) opt for OTT services like Netflix, Hulu Plus and others for content.
The growth in "zero-TV" homes should come as zero surprise. In fact, if there's anything surprising, it's that the number isn't already higher. But who these zero-TV homes are is less clear: are they cord-cutters or cord-nevers? The fact that almost half of them are under 35 suggests many are cord-nevers. Yet, the 2 main reasons for not subscribing to pay-TV (36% due to cost and 31% due to lack of interest) suggests many cord-cutters. Either way, with only 18% of them considering subscribing to pay-TV, most may well be "permanently cordless" and beyond the industry's promotional efforts.
Several weeks ago, after watching Intel Media chief Erik Huggers interviewed at the D: Dive Into Media Conference, I expressed skepticism that the company's marketing plan for its forthcoming pay-TV service would work. Huggers explained that Intel would emphasize a breakthrough, high-quality video experience, rather than a "value approach" where consumers could possibly save money by switching to Intel.
While I agree with Huggers that there's a lot left to be desired in today's pay-TV experience, the reality is that the industry's big players have set the tone for how consumers make their decisions to switch providers: price first, features second. The latest evidence of this was another Verizon mailer that arrived at my house last week (see below), offering a 2-year, $89.99/month bundle of video/broadband/voice and a $250 Visa card. Verizon will also bump the broadband speed to 50/25 mbps as a bonus.
I'm pleased to present the 170th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. First up today, Colin does a little trash talking of Time Warner CEO Jeff Bewkes. At a Deutsche Bank conference earlier this week, Bewkes said “We don’t think the multichannel bundle is becoming less of a good deal, we think it’s getting to be a better deal and we think it’s getting to be a better deal in the opinion of consumers,” Colin thinks this statement is complete baloney and cites specific research refuting Bewkes' assertions (more detail here).
We then shift gears to talk about online and mobile video advertising. It was a busy week on that front (more of what VideoNuze wrote is here). One that really caught my eye and I wrote about was from Extreme Reach. The company announced an innovative cross-media reporting suite that maps actual TV and online video ad impressions along with conversions. To my knowledge it's the first time such reporting has been possible, enabling buyers to have unprecedented insight into campaign ROI.
Listen in to learn more!
Click here to listen to the podcast (19 minutes, 47 seconds)
I'm pleased to present the 169th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. First up today, we review the latest video industry litigation, Cablevision vs. Viacom. We mostly agree that major industry change is unlikely to occur due to the litigation, but rather, over time, the expense of pay-TV and appeal of OTT alternatives will drive changes in consumer choices, which in turn is what will change the pay-TV industry's dynamics.
Speaking of changing dynamics, it's no secret that live TV viewing is under huge pressure as viewers turn to on-demand choices and DVR usage. To help reverse things, Colin discusses an interesting new initiative announced this week by Fox and Watchwith. Fox will be syndicating its FOX NOW "sync-to-broadcast" second screen companion content via Watchwith to numerous network partners such as Shazam, Viggle, ConnecTV and NextGuide, helping drive higher usage and monetization. As Colin wrote earlier this week, it's a clever way of proliferating FOX NOW content and improving the live experience.
Listen in to learn more!
Click here to listen to the podcast (19 minutes, 21 seconds)
Yesterday, Cablevision announced that it has filed suit against Viacom, seeking, among other things, to void a carriage deal it struck just 2 months ago. Cablevision is alleging that Viacom illegally coerced it into carrying 14 of its low-rated cable networks in order to get access to the 8 popular ones Cablevision really wanted.
The most obvious first question to ponder is why would Cablevision agree to a deal in December, only to sue to nullify it in February? Surely the presiding judge will ask something similar. If Cablevision was so perturbed by Viacom's negotiating position, why not bite the bullet and sue then? Another interesting question is that given bundling has been upheld by the courts in the past, what's different this time around?
Aereo announced this morning that it has expanded service to 19 million residents in 29 counties in the New York City metro area, moving Aereo beyond the 5 boroughs. The move is part of Aereo's nationwide expansion to 22 additional markets throughout 2013.
In addition, Aereo took the wraps off its first consumer marketing initiative, with executions emphasizing its live, DVR and portability features. The ads will be placed on billboards, phone kiosks and main transit points in NYC. Importantly, they each carry the company's tagline: "Live TV. Online. No Cable Required." which pointedly positions the company as a cord-cutting option (see below for an example), as I explained recently would happen.
Digitalsmiths has announced deals this morning to power personalized video search and discovery across all platforms for Time Warner Cable, and for i.TV, the TV guide app for iPhone/iPad, Nintento Wii U, AOL, Huffington Post and others.
Ben Weinberger, Digitalsmiths CEO, also told me this morning that the company's "Seamless Discovery" technology is now powering over 1 billion transactions per month, which consist of user requests for search, recommendations and other data. At this level, Ben believes Digitalsmiths is now the largest provider of search and recommendations in North America, its main geographic customer area.