VideoNuze Posts

Say this for Disney - in just the past couple of years or so it has moved to cover virtually every bet for how online video might impact the company in the future.

With its Maker Studios acquisition, Disney expanded into YouTube-style content creation for kids and millennials. With DisneyLife, it’s moving into SVOD entertainment beyond its pivotal output deal with Netflix. Now with Hulu, it’s addressing cord-cutting and the potential of skinny bundles (as well as with deals with DirecTV Now, Sling TV and PlayStation Vue).  And finally, with its new $1 billion BAMTech investment, it’s adding platform capabilities for direct-to-consumer live sports streaming. Plus, with the forthcoming ESPN OTT service, it will test its own direct-to-consumer sports offering.

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On Monday, online video platform Kaltura announced that it has raised a $50 million “pre-IPO” funding from Goldman Sachs’ Private Capital Investing group. With the new investment, Kaltura has raised $165.1 million across 6 different rounds. Kaltura said the new capital will be used to “extend its footprint across all six continents, and to further its unique positioning as the ‘Everything Video’ company.”

I caught up with Ron Yekutiel, Kaltura’s Chairman, CEO and Co-founder to learn more about Kaltura’s strategy and the tailwinds that are helping drive the business forward. Kaltura has 450 global employees, with 250 working in R&D in Israel, 120 in the U.S. and the rest spread throughout global offices.

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Major pay-TV operators made it through another quarter without any substantial acceleration in cord-cutting, according to industry data tallied by analysts MoffettNathanson. In Q2 ’16, pay-TV operators lost an estimated 757K subscribers, compared with a loss of 683K subscribers in Q2 ’15. Note also that the second quarter is always the seasonally weakest. When estimated Sling TV subscribers are added in, the loss declines to 708K in Q2 ’16 vs. 613K lost in Q2 ’15.

In a continuing trend, cable operators again picked up market share at the expense of telcos and satellite providers. Cable’s loss in Q2 ’16 declined to 242K subscribers from 404K lost in Q2 ’15, while telcos swung from a gain of 5K subscribers in Q2 ’15 to a loss of 526K subscribers in Q2 ’15. AT&T accounted for the vast majority of that loss (minus 391K) as it transitioned U-Verse subscribers to DirecTV. Verizon had a loss 41K vs. a gain of 26K a year earlier as it experienced an employee work stoppage.

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Last Monday, in “Apple is Still Spinning Its Wheels in Video While Big Competitors Hit Their Stride,” I explained that while Apple continues to cast around for some type of coherent strategy to be a player in the fast-evolving video landscape, big competitors like Google, Amazon, Comcast and Facebook are all racing ahead and making substantial progress.

Then last Thursday, Peter Kafka at Recode reported that after failing in its attempt to put together its own TV service, Apple’s latest plan is to create some type of TV guide that would be able to discover and show what’s available in multiple video apps (e.g. HBO, Netflix, ESPN) and work on Apple’s devices. But as Peter noted, the new guide idea would mean Apple is focusing solely on an interface that would have no actual revenue stream.

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I'm pleased to present the 334th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.

In this week’s podcast, Colin and continue the debate we began back in early May (see here) about whether Hulu’s “skinny bundle” makes sense. We took up the debate again because earlier this week Time Warner announced that it was acquiring a 10% interest in Hulu and that its ad-supported cable networks would be included in the skinny bundle.

As I wrote on Wednesday, the deal seems to muddy Hulu’s skinny bundle proposition further. With all of the TW networks included, Hulu’s cost of programming also rises, in turn driving up the skinny bundle’s retail price. If the bundle ends up starting at $40, $50 or $60 per month, it won’t be able to create meaningful cost savings vs. pay-TV. Even with TW’s networks, there’s still the “Swiss cheese” risk inherent to all skinny bundles - not offering enough breadth to satisfy a family. If all that isn’t enough, Hulu will be competing with its best customers, a very risky approach.

Colin disagrees and thinks this is a big opportunity for networks to take more control of their destiny. Colin argues that given all the uncertainty of the video market, being able to experiment and get actionable insights from viewer data is valuable. In short, he only sees upside opportunity.

It’s a great debate and we’re both very eager to see how the Hulu skinny bundle will actually look when it’s introduced.

Listen now to learn more!

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Earlier this week AdAge reported that Facebook confirmed it is running tests of mid-roll ads in live streams by certain publishing partners. The ads can appear 5 minutes into the live stream and can run for a max of 15 seconds. The ads are drawn from promoted video campaigns already running on Facebook, but advertisers are able to opt out if they’d like.

The test is clearly just a toe in the water for Facebook in inserting ads in live streams, which to date have run ad-free. But, to the extent that the initiative develops further, and possibly evolves to allow pre-roll ads, it would signal an important step forward in Facebook monetizing its live streams and becoming an even bigger player in online video advertising.

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After months of rumors, Time Warner officially announced this morning that it was taking a 10% ownership interest in Hulu for approximately $580 million. Time Warner also announced that its ad-supported cable networks (TNT, TBS, CNN, etc.) will become part of Hulu’s “skinny bundle” set for launch early next year.

With Time Warner joining Disney and Fox in owning and guiding Hulu (along with Comcast, which is a silent partner), these 3 big cable and broadcast TV networks owners are taking the extraordinary risk of disrupting pay-TV, the very business model that has worked so well for them for decades.

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Seeking to build on its market momentum, Extreme Reach is raising its industry profile through an extensive brand refresh and updated positioning as an enterprise solution for TV and video ad workflows. Extreme Reach has long operated relatively quietly, but industry veteran Melinda McLaughlin, who joined the company late last year, is on a mission to educate the industry about the company’s extensive cross-screen capabilities. Melinda brought me up to speed on the brand refresh and positioning last week.

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