Disney+ launched yesterday and I spent some time with it on my iPad and 60-inch Roku TV. My main takeaway: Disney+ is a winner. Period. End of story. It will have millions of subscribers by the end of this holiday season, and a multiple of that a year from now. As international markets roll out, the millions will multiply again, many times. Anyone’s growth estimates are just that, because how big and quickly Disney+ grows are mainly functions of how much marketing firepower Disney puts behind Disney+. Based on everything we’ve seen so far, Disney is pulling out all the stops.
Over the past few years a powerful virtuous cycle of wired broadband Internet access, connected TV and over-the-top premium content has taken hold, disrupting the traditional TV and pay-TV industries. This virtuous cycle is going to accelerate going forward, causing further instability for established providers and significant opportunity newer entrants.
Robust broadband is the foundation of the virtuous cycle. Today Leichtman Research Group reported that U.S. homes subscribing to broadband cracked the 100 million level for the first time. Big cable TV operators, who have been offering broadband for 25 years, are the winners, now accounting for 67% market share, vs. 33% for big telcos. That’s up from a 64%-46% split 2 years ago in Q3 ’17. Big cable TV operators continue to gain subscribers (830K in Q3 ’19, up 14% vs year ago) while telcos continued to lose them (down 225K in Q3 ’19, the biggest quarterly loss in over 3 years).
Topics: Leichtman Research Group
I’m pleased to present the 490th edition of the VideoNuze podcast, with my weekly partner Colin Dixon of nScreenMedia.
On this week’s podcast, Colin and I review Apple TV+ which launched this past week, and look ahead to what its strategic value may be to Apple in the long-term. One of things we both observed quickly is that there isn’t really even a distinct Apple TV+ experience. Rather it’s just a name Apple has given to a set of original programs that live within Apple’s TV app, which also prominently features programs from other providers like HBO, Amazon, etc. This is in line with what I expected.
With this positioning, it seems clear that Apple’s primary goal is to make the TV app a hub for a viewer’s whole TV experience. The Apple originals (or “Apple TV+”) are really just an extra incentive to use the TV app. All of this leads us to wonder whether Apple will eventually drop the $4.99/mo charge entirely and just consider the originals a marketing expense to keep users within the iPhone ecosystem. That could also mean an iPhone plus video/music/services package (“Apple AllPass?”) for one monthly price could be on the horizon.
Listen in to learn more!
Click here to listen to the podcast (24 minutes, 24 seconds)
Last Friday afternoon CNBC reported that NBCUniversal is “leaning toward” making the free, ad-supported version of Peacock, its upcoming streaming service, free, with everyone getting unrestricted access. This would be a change from restricting it to Comcast’s cable and broadband subscribers only, as originally intended. The ad-free version would still carry a fee.
Which direction Comcast decides to go will say a lot about whether it sees Peacock’s primary role as helping Comcast grow and defend its core cable/broadband business, or having NBCU become a bona fide competitor in the “streaming wars” developing with Netflix, Amazon, Disney, WarnerMedia, Apple, etc. How should Peacock’s value be optimized - by restricting access to serve the Comcast’s cable/broadband business, or to be guided by the market and help NBCU build Peacock into a large OTT business?