Monday, November 24, 2014

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Analysis for 'Microsoft'

  • Microsoft Chops Xbox Studios, A Reminder of How Tough the Premium-Quality Content Business Is

    Microsoft will close down its Xbox Entertainment Studios (XES) as part of a broader, 18,000 employee headcount reduction it has announced. I, for one, am not surprised by this outcome. A year-and-a-half ago, at the D: Dive Into Media conference, I watched an interview with Nancy Tellem, head of XES (and former head of CBS Entertainment) and Yusuf Mehdi, Xbox's chief marketing and strategy officer, that left me wondering whether the company really understood what role it wanted original programming to play or how it would be differentiated.

    Basic questions on whether originals would be included in the current subscription service or cost extra, whether they would be ad-free or ad-supported, exclusive to Xbox or available elsewhere and more were essentially left unanswered, creating a very unfocused vibe. But, since it was still relatively early days for XES, I was inclined to cut them some slack.

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  • 6 Video-Related Takeaways from D: Dive Into Media Conference

    I attended the D: Dive Into Media conference earlier this week for the first time. It is mainly a series of one-on-one interviews with senior executives from a variety of media and technology companies, plus networking. Overall it was a great conference, and it's hard to beat a couple of days in beautiful Dana Point, CA, especially when coming off a blizzard in Boston.

    My main interest was the video-related sessions, and from those I had 6 takeaways which I share below (along with selected session video clips), in no particular order:

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  • Proliferation of Online-Only Originals Points to Further Audience Fragmentation

    Audience fragmentation isn't a new concept, but the proliferation of high-quality online-only originals suggests the trend is only going to intensify. These days, a week doesn't go by without another key player announcing a new or renewed online-only series, in turn creating ever-more choices for viewers and advertisers. Combine the surge in originals with the broad adoption of video-enabled connected devices, and the pieces are falling into place for even more changes in viewing behaviors.

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  • VideoNuze-TDG Podcast #148 - Microsoft Hires CBS Vet; TWC Open to Apple TV; In-Flight WiFi and VOD

    Colin Dixon, senior partner at The Diffusion Group and I are back for the 148th edition of the VideoNuze-TDG podcast.

    First up this week we discuss Microsoft hiring former CBS Entertainment executive Nancy Tellem to develop original content for the Xbox platform and other devices. Colin thinks it's a odd choice because of the apparent mismatch between the type of programming CBS has excelled at vs. the type of programming that will likely resonate with Xbox owners. In particular, Colin notes that 40% of Xbox owners are age 18-24, whereas Nielsen has found that CBS's average viewer's age is 55. Clearly Microsoft is betting that Ms. Tellem can extend her significant programming skills to different formats, audiences and devices.

    Speaking of confusing, we then turn our attention to comments that Time Warner Cable's COO Rob Marcus made this week in reference to the company potentially working with Apple on a set-top box. On the one hand he said that TWC is "open to giving up control of the user experience" to new devices, but on the other, that this does not mean it is willing "to give up the customer relationship." Both Colin and I find the two objectives at odds with one another, particularly when introducing a UI powerhouse like Apple into the living room. As I wrote a couple of weeks ago, if cable operators partner with Apple and its set-top, it will be akin to allowing the fox into the henhouse. We know how that story ended.

    Lastly, as frequent flyers, both of us were excited to read about Delta's new in-flight VOD plans, and JetBlue's forthcoming high-speed WiFI rollout. We discuss implications briefly.

    Listen in to learn more!

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

    Click here for previous podcasts

    The VideoNuze-TDG Report podcast is available in iTunes...subscribe today!

  • Mixpo Enabling Interactive Video Ads for Microsoft Advertising

    Online video advertising platform provider Mixpo is announcing this morning that is supporting Microsoft Advertising's deployment of the VPAID standard on MSN, MSNBC and other properties in its network. VPAID is an IAB standard for video players and ad units that enables market efficiencies for in-stream interactivity. VPAID helps make ads more engaging to viewers, more effective for advertisers and more monetizable to publishers. Here is a sample ad for Nordstrom Rack using the Mixpo ad platform that offers interactive elements to shop, see social media updates and find the closest store.

    (Note: Mixpo is a sponsor of the June 19th VideoNuze Online Video Advertising Summit and will have a team on hand doing demos and answering questions.)

  • Online Video Heavyweights Organize First "NewFronts" Ad Marketplace

    Five of the top 10 online video destinations - AOL, Hulu, Microsoft, Yahoo and YouTube - are joining with ad agency Digitas to launch the first-ever "Digital Content NewFronts" (DCNF). The DCNF's goal is to "shape a new and practical marketplace for connecting the wealth of native digital content with brand marketers and their media and marketing agencies." From April 19th to May 2nd, each of the 6 companies will host a day-long event in NYC showcasing their programming and ad opportunities. The DCNF actually builds on the 1-day NewFront event Digitas has been holding for the last 3 years.

    I think the combined approach of the DCNF is the right idea at the right time. Given the wealth of premium original online video that each of the 5 destinations is pursuing - all of which is ad-supported - the DCNF could become an important catalyst in educating advertisers and agencies about these new opportunities and therefore why they should shift some of their spending. As I've recently written, a bevy of Hollywood A-listers and others are getting involved in original online video productions, helping create a "virtuous cycle" of anticipated growth.

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  • Even Microsoft Can't Afford to Break Into the Pay-TV Business

    Here's just how expensive it has become to break into the pay-TV business: even mighty Microsoft can't afford it. Reuters reported late yesterday that Microsoft has put on hold its plan to create a pay-TV meets Netflix type subscription service, after getting sticker shock over the cost of content distribution deals. When you have $52 billion of cash and equivalents on your balance sheet and still can't figure out how to make the numbers work, that's a pretty significant statement about how expensive licensing linear content has become.

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  • 3 Video Predictions for 2012: Jim Louderback, CEO, Revision3

    Jim Louderback, CEO of Revision3, an independent special interest video network, kicks of VideoNuze's year-end feature of posting the top 3 video predictions for 2012 from executives around the industry.

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  • Music Choice Raises the Bar on TV Everywhere Distribution

    Music Choice, which delivers dozens of channels of streaming music  to over 50 million homes in the U.S. via digital set-top boxes, is raising the bar on TV Everywhere by offering its whole array of services via the cloud to connected and mobile devices. In an initiative  announced last week, Music Choice is partnering with content management provider Sitecore, digital media platform Unicorn Media and Microsoft's Windows Azure cloud service.

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  • Xbox 360 Poised to Deliver Pay-TV Service In Shift to Video App Model

    If you believe the rumor mill, Microsoft will announce as early as today that Xbox 360 will be able to deliver pay-TV services from Comcast and Verizon, as well as additional content from HBO, Sony, Amazon and others, as the gaming console continues its transformation into a full-fledged entertainment hub. Focusing specifically on the Comcast and Verizon aspects, the integration would mark a milestone for the pay-TV industry in moving from a services model delivered through the traditional, set-top box  control point to one where video becomes more like an app (albeit an expensive one!) to be delivered through multiple CE devices.

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  • VideoNuze Report Podcast #108: Deep Dive Into Branded Entertainment

    More than ever brands are trying to break through the clutter of traditional advertising by leveraging online video and social media to create their own "branded entertainment" properties. On today's VideoNuze Report podcast, we take a deep dive into this burgeoning area with two experts, Russ Axelrod, Director, Branded Entertainment and Experiences at Microsoft and Mike Wiese, Director of Branded Entertainment at JWT, a large agency based in New York, who have worked with clients such as Toyota, Macy's, J&J, Rolex and others on branded entertainment projects.

    Russ and Mike explain more about why branded entertainment projects are being pursued, how these efforts fit with the traditional marketing mix, specific projects they've worked on and the metrics used to measure their success and what the future holds for branded entertainment.

    If you're interested in learning more, Russ and Mike will be part of the full-day program at the NATPE Brand Innovation Summit, next Thursday, September 22, in NYC. Discounted registration of $195 is available using the code "INNOVATE" when prompted.

    Click here to listen to the podcast (25 minutes, 32 seconds)

    Click here for previous podcasts

    The VideoNuze Report is available in iTunes...subscribe today!
  • Microsoft Licenses "Taste and Mood" Video Discovery Technology From Jinni

    Jinni, whose "taste and mood" video discovery technology allows viewers to get personalized TV and movie recommendations, has announced a license deal with Microsoft. Though Microsoft didn't disclose how specifically it would use Jinni, the company has been broadening its Xbox gaming platform for video entertainment, so it would fit well there. Jinni could also be integrated across Microsoft's online and mobile properties and in different devices like the Zune.

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  • Digital Movie Purchase and Rental Activity Remains Anemic

    Earlier this week IHS Screen Digest Media Research released market share information for the top 5 U.S. digital/online movie stores for the first half of 2011, which together represent approximately 96% of the market. In addition, IHS released information on revenues generated for both purchase/download (Electronic sell-through or "EST") and rental (Internet video on demand or "iVOD").

    In the chart below, I've taken the IHS data a step further to estimate each of the top 5 stores' revenues and transaction volume from EST and iVOD (note IHS only provides combined EST+iVOD market share information so for simplicity I have assumed each individual store's share is the same for both EST and iVOD though no doubt there are some variations). The data leads to a clear conclusion that years after movies have been available for digital purchase/download and rental, activity remains anemic, suggesting very low levels of consumer interest, particularly as compared with DVD purchase or rental/subscription options.

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  • Friday Fun: Jason Alexander's "Netflix Relief Fund" and Microsoft Office 365's "Gmail Man" Videos

    A little Friday fun - if you haven't yet seen former "Seinfeld" star Jason Alexander's hilarious "Netflix Relief Fund" video on Funny or Die or Microsoft Office 365's "Gmail Man" videos, it's time to take a break and do so. I promise both will lighten your day and prompt you to share further. Then get back to work. Both videos are after the jump. Enjoy!

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  • Microsoft and Nielsen Team Up to Correlate Online Ads With TV Tune-In

    Microsoft and Nielsen are teaming up to launch the "Television Online Effect" pilot program, to help measure how specific online ads drive TV tune-in. The partners will leverage aggregate profile data from Nielsen's TV/Internet Fusion panel to create a target audience based on TV and online usage. Microsoft then plans to run online campaigns to this audience on its owned properties. It will then measure the tune-in effect of these campaigns. Entertainment is the first vertical in the program, which will launch by August 1st.

    I can see a real opportunity for this for various reasons. The TV landscape noisier than ever, with cable TV networks flooding the market with a record amount of original programming and broadcast networks continuing to fight for audience share. Meanwhile, traditional tune-in advertising, in radio and newspaper, is less effective than ever because audiences are spending more time online. The good news is that in online, users' profiles can be accurately understand and then correlated to what TV shows they're likely to enjoy, in turn increasing the ads' ROI and the likelihood that shows find their appropriate audience.

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  • Apple Dominates Still Small Movie Download Business

    Earlier this week IHS Screen Digest released market share estimates for major movie download or "EST" (electronic sell through) outlets in 2010, and no surprise, Apple's iTunes was atop the group, with a dominant 64.5% position. However, that was down 10 points from 2009, as Microsoft, Sony and others all gained share. IHS Screen Digest's research analyst Arash Amel noted that in 2011, Apple is going to face a potentially powerful new competitor in Wal-Mart, which acquired the Vudu VOD service early last year, which could turn the "iVOD" market into a 2 horse race.

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  • Options For Moving Video From Smartphones/Tablets to TVs Keep Growing

    Have you ever had the experience of watching video on your smartphone or tablet and feel like you'd prefer to watch it on your big TV? If so, there is a growing range of options to help make this happen, including:

    Skifta - an Android app from Qualcomm that lets you play local or cloud-based media on any DLNA-certified device.

    AirPlay - a relatively new feature in Apple devices (iPhone, iPad, iPod) running iOS 4.2 or later with one-click ability send media to other connected Apple devices (e.g. Apple TV, AirPlay-ready devices, etc.).

    Rovi Connected Platform - Rovi, the digital entertainment infrastructure provider, just announced yesterday a new Android solution for CE manufacturers to allow their devices to move media around the home to connected devices.

    SnapStick - the intriguing start-up that lets users of any mobile device to "snap" their media over to the TV by gently flicking the device in the TV's direction.

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  • Is Microsoft Planning to Join the Pay-TV Party?

    Reuters is reporting this morning that Microsoft is exploring a range of options to get into the pay-TV business through a new over-the-top service. The article points to a potential "virtual cable provider" model whereby Microsoft would license multiple networks, which would be delivered to Xbox gaming consoles and other devices.  Also under consideration are creating "content silos" to sell specific premium channels.

    If Microsoft were to join the pay-TV business aggressively it would further alter industry dynamics. The number one issue in play right now is whether consumers are forsaking traditionally packaged pay-TV services and instead opting for some mix of free and paid online-delivered alternatives. Yet while Internet options are gaining in popularity (with Netflix's explosive growth to nearly 17 million subscribers at the end of Q3 the primary beneficiary), hard data supporting cord-cutting is still scarce.

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  • With ESPN Partnership, Xbox Reemerges as a Convergence Competitor

    Monday's ESPN-Xbox deal brings the Xbox back into view as a competitor in the Internet connected set-top box battle that has further heated up since the Google TV announcement. Oddly, the Xbox, a device that is already in millions of homes, is often left out of the convergence conversation. To me it seems like a sleeping giant, with many early advantages that should put it squarely on the connected STB map.

    The Xbox, as a gaming device primarily, clears the hurdle many set-top boxes stumble over - getting people to buy an additional box. Gaming has allowed it to build a user base of early adopters who are eager to consume online video. Its controller is an easy to operate wireless gamepad, great for navigating screens and menus quickly. In addition, the gamepad has an attachable keyboard the size of a mobile device for easy searching of vast libraries of content.

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  • Silverlight Team Offers 4 In-Depth Case Studies on 2010 Winter Olympics Online

    A heads-up that the Silverlight team has just posted 4 great case studies detailing different aspects of their international media partners' experiences delivering the 2010 Winter Olympics online. The partners are CTV (Canada), NBC (US), NRK (Norway) and France Televisions (France). All were using Microsoft's Silverlight and IIS Smooth Streaming.

    The case studies dig into 4 topics: online viewing times, effective ad monetization, broadcast reach and quality experience. I've only had an opportunity to skim each of the 4 case studies, but they are packed with in-depth information and details that I have not seen before. For those interested in learning more about how a high-profile live event like this was executed and some of the key performance metrics, this is super valuable info.

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