These days there’s no shortage of SVOD services to choose from, with each one seeing to grab a slice of viewers’ monthly spending. And with cord-cutting on the rise, undoubtedly there IS some spending freeing up as viewers cancel their pricey pay-TV services.
But two major industry trends should keep SVOD providers from being overly optimistic about replicating anything close to Netflix’s ad-free hockey stick subscriber growth over the past decade: first, the prevalence of password sharing and second, a tolerance for advertising related to “subscription fatigue” that the proliferation of SVOD services is engendering. New data released this week by Hub Entertainment Research and The Trade Desk underscores the extent of both.
Amazon announced this morning that it has over 40 million active Fire TV users globally, up from over 37 million that it reported in early September, 2019. The 3 million or so gain would represent monthly growth of around 750K Fire TV users. Amazon said there will be 150+ Fire TV edition models in 10+ countries by the end of 2020. Fire TVs include sticks, boxes, smart TVs, sound bars, auto screens and devices for pay-TV operators.
By Amazon’s count, Fire TV was already the top connected TV (CTV) provider globally in Q3 ’19, and its lead over Roku will likely expand just a bit for year-end 2019. Roku will report Q4 ’19 results on February 19th. At the end of Q3 '19 Roku reported 32.3 million active user accounts. In Q4 ’18 Roku added 3.3 million active user accounts, which would mean even if Roku doubled its quarterly growth in Q4 ’19 (which is unlikely), it would still be shy of Fire TV’s total.
Happy New Year!
Recently, eMarketer forecasted Connected TV (CTV) advertising will increase from approximately $7 billion in 2019 to over $14 billion in 2023. The forecast gained a lot of attention in the closing weeks of 2019 as CTV came into focus as one of the industry’s most important themes in 2020. To learn more and get behind the numbers, I recently interviewed eMarketer video analyst Ross Benes who was responsible for the forecast. A lightly edited transcript follows.
(Reminder, for a deeper dive, check out VideoNuze’s Connected TV Advertising Summit on June 11th in NYC)
VideoNuze: eMarketer recently released a forecast showing CTV ad revenues increasing from approximately $7 billion in 2019 to over $14 billion in 2023. What are the key contributors to this rapid growth?
2019 was yet another year of amazing innovation and change in the video industry. As Colin and I discussed on our podcast yesterday, in 2019 we saw the launch of Disney+ and Apple TV+, cord-cutting hit a record in Q3, Netflix lose subscribers in the U.S. for the first time in Q2, CTVs and CTV advertising surge, and so much more.
I’ve been saying for years that broadband delivery - allowing video to be directly delivered to viewers without any intermediary - would be highly disruptive to the video industry. Now, combined with OTT, CTVs, mobile and data-driven advertising, broadband’s impact is on full display.
It’s been another year of great fun trying to make sense of all of these changes, while trying to look around the corners to help VideoNuze readers understand what may be coming next.
2020 is setting up to be a monster year for the industry, with more cord-cutters than ever using their CTVs to watch their favorite OTT services - plus following the election and the Olympics - and lots more. We’ve also seen a lot of activity on the deal front (Disney-Fox, Disney-Comcast-Hulu, Viacom-CBS, etc.) and I expect more in the new year as established companies jockey for position.
2020 will also bring VideoNuze’s Connected TV Advertising Summit in NYC on June 11th, which promises to be the deepest dive conference of the year on CTV advertising, which is the biggest opportunity the TV industry has to capitalize on fundamental changes in viewers’ behaviors.
Thanks to all of the industry leaders who have sponsored VideoNuze in 2019. And of course a huge thanks to VideoNuze’s daily readers, podcast listeners and conference attendees. Engaging with you and hearing your feedback remains the most interesting part of what I do.
Wishing you and your families a happy, healthy holiday season and all the best in 2020!
I’m pleased to present the 495th edition of the VideoNuze podcast, with my weekly partner Colin Dixon of nScreenMedia.
In today’s podcast, our final one for 2019, Colin and I share our top 10 video stories of the year. Whether you agree or disagree with our top 10 (or the ordering), no doubt we can all agree it’s been quite an eventful year for the industry. But as busy as 2019 has been, 2020 is setting up to be a year of even more innovation and change.
As always, Colin and I have had a ton of fun discussing all of the industry’s happenings each week, and we hope you enjoyed following along throughout the year.
Listen in to learn more!
Click here to listen to the podcast (33 minutes, 10 seconds)
On Tuesday PBS announced that over 100 of its member stations, covering 75% of U.S. households, have been activated for live streaming on YouTube TV. Previous to the launch PBS content was available across many devices through its own apps and the web. Incorporating the stations’ live feeds directly into YouTube TV means that users can seamlessly access them alongside other channels, use YouTube TV’s unlimited DVR feature to record PBS programs/watch later, etc.
It’s a smart move by both PBS and YouTube TV. PBS viewers skew older, and are therefore more likely to retain traditional pay-TV services, which have always carried PBS stations. But younger audiences are more likely to be cord-cutters or cord-nevers, relying instead on CTVs, mobile devices and OTT services. By not being a part of a virtual pay-TV operator, PBS’s exposure to critical younger audiences was being limited.
A question that has been following Netflix since the beginning of time is whether the SVOD giant would ever include advertising. Netflix management has consistently responded “no” and emphasized that their viewers expect an ad-free experience. Saying this so many times has created the perception that Netflix’s opposition to advertising is “religious” (i.e. so core to its brand/strategy/user experience that deviation simply isn’t possible) that no logic to the contrary will prevail.
But looking ahead to the new decade and the vastly different industry dynamics that are unfolding, I think there are many reasons why religion is finally going to give way to business imperatives. For anyone already saying, “no, no I just don’t believe Netflix could undergo such a conversion,” keep in mind the intense objection Steve Jobs had to subscription music. Then came Spotify’s incredible growth and in 2015, Apple Music was launched (note, Tim Cook took over as CEO in 2011, just prior to Jobs's death).
I’m pleased to present the 494th edition of the VideoNuze podcast, with my weekly partner Colin Dixon of nScreenMedia.
This week Colin and I discuss “TV In Your Pocket: Mobile Video Downloading Report,” which we just released. We analyzed 80 top video services, and found that 28 of them offer mobile video downloading. We did 9 different tests probing further for specific features and implementations. In the podcast we share some of our key takeaways and surprises from our research. We also look ahead and make a few predictions about where downloading is going to go. Many thanks to Penthera for sponsoring the report.
We then briefly discuss Roku’s upcoming Stream-a-thon, which we both believe is a very smart move for Roku and its various partners, including HBO, Showtime, Starz and others. Stream-a-thon will expose millions of Roku users to premier programming (“Game of Thrones,” “Billions,” etc.), no doubt driving lots of new subscriptions. It’s a real win-win and once again illustrates how the video landscape is being rearranged.
Listen in to learn more!
Click here to listen to the podcast (23 minutes, 13 seconds)