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Monday, October 20, 2014

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Analysis for 'Studios'

  • VideoNuze Podcast #244 - Will Netflix Disrupt Movies' Windowing Practices With "Crouching Tiger" Sequel?

    I'm pleased to present the 244th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.

    Netflix kicked up a lot of dust earlier this week, when it announced the sequel of "Crouching Tiger, Hidden Dragon," produced by The Weinstein Company, will be available simultaneously as part of Netflix monthly subscriptions and in IMAX theaters when it premieres in August, 2015. The so-called "day-and-date" strategy prompted two of the three big U.S. IMAX chains, Regal and Cinemark, to declare they won't show "Crouching Tiger" on their screens.

    The core issue here is whether a meaningful percentage of Netflix subscribers will opt to watch the movie as part of their subscription, thereby cannibalizing potential theater sales. Colin and I agree this risk is high, mainly because a family of four would pay at least $60-$80 just for tickets to see the movie in IMAX, a stark premium over their $8 Netflix subscription.

    Admittedly, IMAX is a very unique experience, but with the quality of today's HDTVs and home theater, for many, watching at home is quite stellar. As such, theater owners seem well justified in boycotting the movie to preserve their long-term value proposition.

    The "Crouching Tiger" move raises a host of other questions Colin and I also dig into: Will it have a positive impact on piracy? Is Netflix signaling a serious push beyond TV into movies (see also its 4-movie Adam Sandler deal this week)? And, is Netflix shifting toward a more exclusive content strategy?

    Click here to listen to the podcast (20 minutes, 28 seconds)

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  • Sesame Workshop's New "Sesame GO" SVOD Service is a Key Test Case for Standalone Viability

    In a key test case of whether standalone SVOD services can succeed, even when well-branded and targeting appealing audiences, Sesame Workshop has unveiled its own service today, dubbed "Sesame GO." The ad-free service carries a $3.99/month or $29.99/year fee and includes the newest full-length episodes of Sesame Street, a catalog of Sesame Classics and two seasons of Pinky Dinky Doo.

    Sesame GO uses Kaltura's MediaGO, a "Netflix-like" OTT solution for content and service providers to quickly launch SVOD services.

    At first blush, Sesame GO's ad-free, child-centric UI, featuring popular content, would seem like a pretty strong bet. However, Sesame GO is entering an increasingly competitive landscape for online kids content created partly by Sesame's own licensing practices.

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  • Why a Disney Bet on Maker Studios is a Bet on the Future

    Big media companies are often cast as lumbering giants, slow to recognize change and even slower to embrace it. But for Disney, that stereotype looks increasingly inappropriate, as the company continues making moves to better position itself for the vastly different upcoming online video era.

    Yesterday's report that Disney is mulling an acquisition of Maker Studios for $500 million, one of the biggest of the YouTube multichannel networks ("MCNs") with over 500 million videos viewed/month in January, is the latest sign that Disney recognizes the future rules of the road in the media industry will be far different than they were in the past. Maker - and other big MCNs - underscore 3 of the biggest emerging rules: (1) that talent can now break big without the backing of the traditional media, (2) that YouTube is a bona fide new distribution platform and (3) that traditional media's grip on millennials may be slipping.

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  • VideoNuze Podcast #216 - Debating Netflix-Comcast Interconnect; Disney Movies Anywhere

    I'm pleased to present the 216th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. In today's podcast, we first discuss Disney Movies Anywhere, which launched this week. Both of us like it a lot (more of my take here). Colin believes it could also become a huge threat to UltraViolet if one other major studio were to adopt Disney's KeyChest technology.

    Then we turn our attention to the Netflix-Comcast interconnection agreement, which has taken on a life of its own this week. It's rare when Colin and I see the world completely differently, but in this case, we do. Colin believes the deal sets a dangerous precedent because Netflix is being provided "extraordinary access" to Comcast's network and also that, going forward, if a content provider wants to get good performance on Comcast's network, it would have to do a deal with Comcast.

    I don't see it this way. As I wrote earlier this week, the deal strikes me as business as usual, with the joint press release specifically saying "Netflix receives no preferential network treatment." Netflix made a business decision to negotiate directly with Comcast and manage/deliver their content themselves rather than work through a CDN which is what the vast majority of content providers do. This path obviously made sense for Netflix, but remember, it's in a somewhat unique situation because it accounts for 1/3 of all Internet traffic at certain times.

    Because Netflix and Comcast said so little about the deal themselves, and because there is so much suspicion of Comcast (and other broadband ISPs) regarding net neutrality, market power, etc., a lot more has been read into this deal than I believe is warranted.

    Colin and I have a very vigorous debate on these issues and ultimately agree to disagree :-)
    Click here to listen to the podcast (30 minutes, 27 seconds)

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    The VideoNuze podcast is also available in iTunes...subscribe today!

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  • 5 Reasons Why Disney Movies Anywhere Looks Like a Winner

    Disney launched its long-planned digital movie service today, dubbed Disney Movies Anywhere ("DMA" for short). Disney made a bold decision when it opted not to participate in the UltraViolet consortium that includes 6 of the other big Hollywood studios, choosing instead to go with its own "KeyChest" authentication technology. Having spent some time with Disney Movies Anywhere this morning, I think there are 5 reasons that DMA looks like a winner, offering lessons for other content providers seeking to capitalize on paid online models.

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  • Binge-Viewing Popularity Exposes Tensions Between OTT and VOD, TV Everywhere Priorities

    Binge-viewing is a bona fide phenomenon that's not only changing consumers' TV viewing behaviors, but also creating fissures in the TV industry. Recently, in "For U.S. Cable Operators, Netflix Partnerships Are Fraught With Risk," I outlined how binge-viewing is driving a competitive dynamic over content rights between Netflix and pay-TV operators' VOD and TV Everywhere plans. Adding further detail, this past Friday, Vulture published an excellent article with specific examples of how this battle is brewing.

    According to Vulture, FX and Turner are telling studios from which they obtain TV shows that they need rights to stream the full current season of shows (known as "stacking" rights) not just the most recent 3-5 episodes. Part of the networks' rationale is they need to give late-coming viewers an easy path to watch from the beginning of a season, rather than just enabling existing viewers a way to catch up.

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  • VideoNuze Podcast #195 - FremantleMedia Capitalizes on 2nd Screen Apps; Mobile Video's Surge

    I'm pleased to present the 195th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. Colin patched in from Amsterdam, where he's attending the big IBC show. Colin sat in on an interesting session with Keith Hindle, CEO of FremantleMedia's Digital & Branded Entertainment Division. For those not familiar with Fremantle, it is one of the biggest producers of TV shows in the world, with credits like American Idol and The X Factor.

    Colin shares some of Hindle's key observations about how the TV landscape is shifting, the powerful role of 2nd screen apps in attracting advertisers, the paradigm of "paid/owned/earned" media and how to balance TV distribution vs. online (Fremantle is the 12th-ranked YouTube content partner). Lots of great insights.

    We then shift our focus to the plethora of data this week quantifying the surge in mobile and tablet viewing. I have covered new reports from FreeWheel, Ooyala, VEVO and TubeMogul this week, all supporting this trend. VEVO in particular is capitalizing, with 50% of its views now on mobile, tablet and connected TVs (note, the success of VEVO TV has been a huge contributor on the latter).

    Still, as we agree, it's important to remember that TVs and desktops are where the vast majority of video viewing currently occurs, per Nielsen and FreeWheel data respectively. This is changing each quarter, but it's an evolutionary, not revolutionary shift.

    Click here to listen to the podcast (17 minutes, 43 seconds)

    Click here for previous podcasts

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    The VideoNuze podcast is also available in iTunes...subscribe today!

    (Note there is a 3 second drop-out in the audio mid-way. Apologies, we're not sure what happened. During it, I am referencing VEVO TV.)

  • Disney Online Movies' Demise Is Another Blow for Transactional VOD and Digital Lockers

    Disney's announcement that it was shutting down its Disney Movies Online service on Dec. 31 is another blow for transactional VOD and digital lockers for movies, two corners of the online video ecosystem that are struggling for traction.

    Transactional VOD - renting or buying movies online - has become a tougher sell to consumers in the digital age. Not long ago Hollywood studios' home video divisions boomed as many consumers were keen to buy DVDs and create large collections of movies that they prominently displayed. But while DVD sales have gone off the cliff recently, digital rentals and purchases haven't picked up the slack.

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  • Can YouTube Succeed With Online Movie Rentals?

    Yesterday YouTube got a lot of coverage of its new licensing deal for hundreds of movies from Paramount because separately, the studio's parent company, Viacom, has been involved in a bitter copyright litigation with YouTube for years. While it's noteworthy that the parties are able to do business despite suing each other, the bigger questions here are whether YouTube's initiative to rent Hollywood movies makes sense and can succeed?

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  • UltraViolet and TV Everywhere: It's All About Devices and Access. But That's Not Enough.

    I'd wager the two most spoken words in the media and entertainment industries these days are "devices" and "access." Executives are gripped by the idea that consumers must have access to their content across a growing universe of video-enabled devices. In fact, the premise of the industry's two most strategic initiatives - UltraViolet and TV Everywhere - is that by enabling access to content on multiple devices, traditional business models will either be reinvigorated (in UV's case for DVD purchases) or buttressed against attack (in TVE's case for pay-TV's multichannel bundle).

    If only things were that straightforward. While it's undeniable that improved access on multiple devices is extremely valuable, especially for today's on-the-go viewer, the shortcoming of both UV and TVE is that neither addresses fundamental changes in consumer behaviors or preferences. Broader access is only half the battle here; the other half is devising the right business model that meets consumers' vastly changed expectations. Until this piece of the equation is solved, I doubt that either UV or TVE is going to have the industry's hoped-for impact.

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  • VideoNuze Report Podcast #123 - Aereo, Starz-Netflix, UltraViolet

    I'm pleased to be joined once again by Colin Dixon, senior partner at The Diffusion Group, for the 123rd edition of the VideoNuze Report podcast, for Mar. 2, 2012. This week's podcast has a different format; instead of discussing one topic in depth, we touch on three areas - the new lawsuit against Aereo, Netflix's deal with Starz ending (and whether the "flix" is coming out of Netflix) and UltraViolet's strategy of using discs to drive adoption.

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  • With New Disney Deal, Is YouTube Poised to Disrupt Online Movie Rentals?

    Last Wednesday, just before the Thanksgiving break, YouTube announced a deal with Walt Disney Studios which will make hundreds of new and classic movies from Disney, Pixar and DreamWorks available for rental. The Disney deal adds to the online movie rentals (or "iVOD" as this category is also known) initiative YouTube announced last May. Between the breadth of movies soon to be available, its aggressive pricing - including $.99 rentals on recently-released blockbusters, its integration in numerous connected devices and of course, its status as the online video market's 800-pound gorilla, YouTube may just have what it takes to disrupt the iVOD market, impacting the broader Hollywood and movie distribution industries.

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  • AnyClip Licenses Warner Bros. Movies for Clip Library

    AnyClip is announcing this morning that it has licensed thousands of Warner Bros. movies to be able to tag and create searchable clips for its library. Movies include select Harry Potter and Batman movies, Ocean's Eleven, Sex and the City, Dirty Harry, Casablanca and others. AnyClip tags each movie with over 5,000 unique elements to create a rich index. To date AnyClip's has been offering access to 50,000 clips from 12,000 movies sourced from Universal, Vivendi and others.

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  • Cinemark Shouldn't Worry: Universal's "Tower Heist" $60 VOD Test Will Also Flop

    Late yesterday, the LA Times reported that Cinemark, the 3rd-largest theater chain in the U.S., will boycott "Tower Heist," the new Eddie Murphy-Ben Stiller comedy, because of a test unveiled by its studio Universal Pictures to offer the movie just 3 weeks after its theatrical release for $60 on video-on-demand. Cinemark is concerned that the test would cannibalize box office sales. From my perspective, it needn't worry much as the test is likely to be yet another flop in what has become known as "Premium VOD."

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  • DreamWorks Gives Netflix A Much-Needed Lift, But Not Until 2013

    DreamWorks Animation's new output deal with Netflix gives the beleaguered streaming-only provider a much-needed lift, but unfortunately not until DreamWorks' 2013 movies are released. Under the deal, Netflix may pay up to $30 million per movie, an increase from the $20 million that HBO is believed to have been paying DreamWorks. The press release also notes that some of DreamWorks' catalog movies such as "Kung Fu Panda," "Madagascar 2," "Chicken Run" and "Antz" will also be included over time.  The DreamWorks deal comes on the heels of last week's news that Netflix licensed library programs from Discovery Communications.

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  • Amazon Gets Universal Movies to Stream That Netflix Already Has

    Amazon announced a new licensing deal with NBCU that gives it streaming rights to a batch of older movies from Universal Pictures, bumping to 9,000 the number of movies and TV shows available for its Amazon Prime Members. However, the move is unlikely to have the folks at Netflix quaking in their boots; like Amazon's licensing deal with CBS from last week, virtually all of the Universal movies are already available on Netflix (by my count 9 of the 11 titles identified in today's press release can be streamed on Netflix while only "Elizabeth" and "Fletch" are available solely on DVD).

    Don't get me wrong, more content is always a good thing, and these deals, along with an acquisition of Pushbutton, a UK app developer for connected devices, suggest things may be ramping up at Amazon. But the content deals do underscore the catch-up game that Amazon is playing with Netflix. That's the dynamic in today's market - Netflix got a head start in aggregating Hollywood content for online distribution. Now, to the extent it has a willingness to pay, Amazon must go do similar deals.

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  • Netflix Inks Miramax Deal; Streaming Movies Still Plenty Important

    Netflix is announcing a new multi-year deal with independent film studio Miramax, giving it streaming access to hundreds of films in the U.S., including Best Picture winners "The English Patient" and "Shakespeare in Love" plus others like "Good Will Hunting," "Pulp Fiction," "Kill Bill," "The Piano," etc. In all, the films coming to Netflix have gained 284 Oscar nominations and won 68 times. Miramax was recently spun-off from Disney, and this is the first time the films have become available in any digital subscription service.

    The deal is another significant win for Netflix and underscores the point that movies are still plenty important to the company's streaming content strategy, despite the fact that most of its recent content acquisitions have been catalog TV programs. The challenge with acquiring streaming film rights is that "windowing" (i.e. the process by which a film passes through predetermined distribution outlets - theatrical, VOD, DVD, online sell-through, etc.) is still quite strictly enforced by studios, making it challenging for Netflix to accelerate its acquisition efforts.

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  • Premium VOD is a Train Wreck Though It Just Doesn't Matter

    Yesterday marked the official launch of "Premium VOD" by DirecTV, a plan under which movies will be released just 60 days after their theatrical opening (half the usual time) for 48-hour rental by subscribers for $30. The first movie being offered this way, which DirecTV dubs "Home Premiere," was Sony Pictures' "Just Go With It" starring Adam Sandler. Three other studios, Warner Bros., Universal Pictures and Fox have already signaled their intent to release movies on Premium VOD with DirecTV and other pay-TV operators who have expressed interest.  

    Theater owners and the Hollywood creative community are livid about Premium VOD, which they perceive as paving the road to cannibalizing theatrical attendance which would in turn harm a movie's overall economics, creating a dangerous downward spiral. In addition, there's concern that if consumers switch to watching movies on the small screen then the creative license implicit in a big screen emphasis will get squeezed. While their concerns are completely justified, the good news for them is that Premium VOD will be lucky to achieve even minimal success. Instead it will more than likely end up being a short-lived experiment that will have virtually no impact on larger Hollywood dynamics. Here's why:

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  • New Netflix Deals Show How Little "Dexter" and "Californication" Really Matter

    A couple of weeks ago, in "Showtime Circles Its Wagons, But to What End?" I questioned Showtime's decision to withdraw from Netflix streaming rights to early seasons of 2 of its hit shows, "Dexter" and "Californication." One of the points I made was that Netflix would survive this loss just fine because they have enough streaming content already, and more coming all the time.

    Sure enough, Netflix has more than proved my point, announcing a deal last Friday with 20th Century Fox that gives it streaming rights to the first season of the Fox hit "Glee," the first 2 seasons of the FX favorite, "Sons of Anarchy" and the library of "Ally McBeal" and "The Wonder Years." Then this past Wednesday, Netflix announced a deal with Lionsgate for streaming rights to the first 4 seasons of AMC's signature series "Mad Men," with 3 more seasons to follow after their on-air run (Netflix already had the Canadian streaming rights to the show).

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  • Sony Pictures Taps Value of Archive With Thought Equity's Metadata Editor

    Major content providers are continuing to realize that new value can be mined from archives of long-form premium content by creating and indexing metadata in order to distribute shorter clips of key scenes. The latest example came this week as Sony Pictures Entertainment struck a deal with Thought Equity Motion to use its T3 Metadata (screen shot below) for its enormous catalog of entertainment content.

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