VideoNuze Posts

I'm pleased to present the 321st edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.

Hulu was in the news in a big way this week, confirming a WSJ report that it plans to launch a skinny bundle next year. As I wrote on Monday, the move raises numerous questions, which Colin and I debate on this week’s podcast.

Absent more information, I’m still somewhat skeptical. It feels very risky to me for Disney and Fox to convert Hulu into a pay-TV competitor. It’s also not clear that the economics of a direct subscriber relationship are superior to the steady flow of monthly retransmission consent and affiliate fees. Finally, I wonder about how big the addressable market is and how appealing the Hulu skinny bundle actually will be, particularly from an all-in cost perspective.

Colin, on the other hand, is much more optimistic. He doesn’t believe there’s much risk, thinks the economics are better going direct and believes the service can be very appealing. So clearly we’re coming at this from very different angles.

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YouTube drew 2,700 industry executives to a cavernous Javits Center for its Brandcast NewFront to tout its audience scale vs. primetime TV. CEO Susan Wojcicki said that during primetime in the U.S. more 18-49 year-olds watch YouTube videos than the top 10 TV shows combined, according to a Google-commissioned Nielsen study in December, 2015.

Based on the same study, Wojcicki said that it reaches more 18-49 year-olds than any broadcast or cable TV network, on mobile alone. But YouTube is not only proud of its mobile viewership, it also said the number of hours watching YouTube on connected TVs more than doubled in the past year.

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Don't miss out on a chance to win a 55-inch TCL 4K Roku TV by registering early for the 6th annual VideoNuze Online Video Ad Summit on Tuesday, June 14th in NYC.

Yesterday’s news that Magna Global has committed $250 million of client spending to YouTube - all shifted from TV budgets - is another critical reminder of how dynamic the TV and video advertising markets are. Our keynoter from last year’s Ad Summit, David Cohen, president of Magna Global N.A. told the WSJ, “We have negotiated a meaningful share shift from linear television to digital video.”

The decision will be a key part of our “NewFronts, Upfronts and the Transitioning Ad Market” fireside chat featuring Adam Shlachter, President, VM1, Zenith and Maureen Bosetti, Chief Investment Officer, Initiative, which is Magna’s sister IPG company. Once again, Tim Hanlon will moderate the discussion which will examine the dynamics of budgets are being allocated between TV and video.

The exciting program will feature 13 sessions spanning all the hottest industry topics. Over 30 executives are already confirmed to speak, from industry leaders like A+E Networks, American Express, Bloomberg Media, Conde Nast, IAB, Initiative, Mindshare, NBCU, Newsy, Turner, The Washington Post, The Weather Company, Whistle Sports, Xaxis, Zenith and many others.

Last year's Ad Summit drew over 450 attendees and I expect similar attendance this year too, so register early to reserve your place!

Many thanks to the 15 industry-leading companies on board so far as sponsors, including Title Partner Videology, Premier Partners Altitude Digital, DashBid, Extreme Reach, Verizon Digital Media Services and VertaMedia, Headline Partners Alphonso, Beachfront Media, Cedato, FreeWheel, Genesis Media, JW Player, Operative and Placemedia and Branding Partner Roku.

Learn more and register now!

While the main goal of Hulu’s NewFront this morning was of course to excite advertisers to open their checkbooks, the event also marked the unofficial kickoff of the company’s ambitious repositioning from a catchup SVOD hub to an all-encompassing, next-generation, personalized TV service including live linear TV feeds.

At its NewFront, Hulu’s CEO Mike Hopkins confirmed what had been strategically leaked to the WSJ in an article reported Sunday night - that the company intends to launch a skinny bundle of linear broadcast and cable TV networks to augment its on-demand programming, for monthly fee of approximately $40.

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New IAB research indicates that ad spending on original online video is up 114% in the past 2 years. The 360 advertiser and agency executive respondents said that their average original online video ad spending has increased from $2.1 million in 2014 to $4.5 million in 2016. Telecom is the vertical with the highest average spending in 2016 ($6.7 million), followed by Health and Beauty ($6.4 million).

The research revealed that more than a third of advertisers’ online video budgets and 38% of their original video budgets will be allocated at the NewFronts, underscoring why online and established companies continue to invest in their presentations. 8 in 10 respondents (including both TV buyers and digital buyers) said that they increased their original online budgets due to NewFronts attendance.

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With so much uncertainty in the TV and online video industries these days, I keep telling myself to never be surprised by anything anymore. But last night, when the WSJ headline, “Hulu is Developing a Cable-Style Online TV Service” popped up in my Twitter feed, I have to admit it tested the boundaries of my imagination.

The most immediate head-scratcher was that such a move would position Disney and Fox, two of the three network shareholders in Hulu (along with Comcast, which is now a silent partner due to terms of its NBCU acquisition) as direct competitors of pay-TV operators, their biggest distributors. These companies spend billions of dollars per year to carry the very same TV networks that would now be included in the skinny Hulu lineup.

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Late last week Videology shared Q1 ’16 data from its platform, showing the continued convergence between TV and online video advertising. Videology found that 11% of video campaigns run through its platform used TV data segments to help target online video campaigns. As in the past, the most-used segment was current TV ad schedules, followed by sports viewers and competitors’ TV schedules.

The use of TV audience data has been on an upswing over the past year plus according to Videology. In Q4 ’15, Videology reported that video campaigns using TV audience data had increased by 114% year-over-year. No doubt this was off a very small base as the whole concept of using TV viewing data is still relatively early stage.

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