VideoNuze Posts

A fortuitous confluence of events could give Aereo a nice bump in visibility and adoption in New York City this week. First, CBS went dark for hundreds of thousands of NYC subscribers last Friday afternoon, as the broadcaster and Time Warner Cable were unable to agree on retransmission consent compensation. Then over the weekend, Tiger Woods - by far golf's biggest TV draw - smoked the field to win the WGC-Bridgestone golf tournament, which was televised by CBS (though not seen by New Yorkers). The win makes Tiger the odds-on favorite to win the fourth and final major golf event of the year - the PGA Championship, being played in upstate New York starting Thursday.

CBS has the weekend afternoon TV rights to the PGA, following TNT's Thursday/Friday and weekend morning coverage. Tiger is gunning for his first major win in 5+ years, since his infamous infidelity scandal knocked him off his game. If Tiger is leading or among the leaders going into the weekend, it would set up intense interest and very strong CBS viewership. But with CBS blacked out - and the network blocking TWC New York subscribers' access to online programming - New Yorkers wouldn't get to see Tiger in action.

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I'm pleased to present the 190th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.

We start our discussion with data that TiVo Research and Analytics (TRA) released this past Monday, which concluded, among other things, that Netflix does not cannibalize traditional TV viewing. TRA also identified the percentage of respondents who subscribe to Netflix (and other services) who watched "House of Cards." Using these numbers, Colin calculates that about 10 million people watched the program, a healthy amount by any standard (Netflix hasn't publicly released HoC's audience). Colin sees a class of "super-viewers" whose traditional TV consumption is augmented by, not substituted with, Netflix.

One thing that caught my attention in the TRA data was that while Netflix had a 57% adoption rate among respondents, Amazon Prime was right behind it, at 50% (Hulu Plus was further back at 18%). To be fair, it's not clear whether these Prime members are actually watching video included in Prime, or are mainly focused on the unlimited shipping benefit. But, assuming that many DO watch video, it's an impressive number for Amazon, and underscores how far Prime has come in the 2 1/2 years since Instant Videos were launched.

Colin and I discuss Amazon's broader agenda and how its aggressive pursuit of video is strategic in supporting both Prime and the Kindle ecosystem (all of which I described in my post this past Monday). Given Amazon's willingness to operate on razor-thin margins, I foresee the price for licensing high-quality content continuing to rise, which will in turn pinch profitability (and subscriber growth) at pure play OTT providers like Netflix.

Click here to listen to the podcast (16 minutes, 48 seconds)

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Yesterday afternoon I had the pleasure of attending the Video Ad Effectiveness Summit in NYC, presented by Nielsen and Beet.TV. The afternoon was broken into 3 panels of 3-5 executives from the media, publishing and agency worlds, all of whom are all deeply immersed in online video advertising. The discussions were expertly moderated by Beet.TV's Andy Plesser and Furious Minds' Ashley Swartz. I took a bunch of notes, which I distilled into 3 key themes that I thought emerged from the discussions.

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If you're looking for a case study on how a successful independent content provider with its roots in YouTube is looking to diversify its distribution through other devices/outlets, "The Young Turks" (TYT) is a great example. Yesterday the company announced the availability of its Roku channel and its intention to launch standalone Android and iOS apps soon. TYT's COO Steve Oh told me these direct-to-consumer initiatives are part of a broader plan to augment - but by no means abandon - its traditional distribution through YouTube.

With 50 million views per month, 1 billion+ views to date, and over 1.1 million subscribers, TYT believes it is the biggest online news show in the world. TYT is a top 50 YouTube partner, and what Steve calls a "boutique multichannel network" (MCN) because it focuses on a relatively narrow slice of partners in online news. While there has been some public grumbling about YouTube from its content partners lately, Steve had nothing but praise for the 800-pound gorilla of the online video world, highlighting that all of TYT's new efforts are an "augment" not a "replacement" for YouTube.

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A viewer finds an online video, clicks play and increasingly, expects a TV-like experience. Hundreds of millions of times per day around the world, this sequence of events happens, and it's only growing in frequency. While surging demand is great for the overall ecosystem, network providers / broadband ISPs are continually struggling to keep up with spiraling traffic, pressed to invest in their networks to create more capacity while still maintaining a strong ROI.

Therefore, any incremental improvement in networks' efficiency in delivering video traffic can quickly add up to huge cost savings, and that's exactly what Qwilt, which has raised another $16 million (led by Bessemer Venture Partners and bringing to $40 million total raised to date), does. Qwilt is in the "transparent caching" business, with networks deploying the company's  software solution on off-the-shelf hardware at the edge of their networks to deliver the thin slice of most-frequently viewed video to their users.

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Google's new Chromecast device dominated the video landscape last week, making it easy to miss a highly noteworthy news nugget from Amazon: on its Q2 '13 earnings call last Thursday, Thomas Szkutak, the company's SVP/CFO said, "We're having new Prime members come to Amazon largely because of video." Szkutak's comment was a stark reminder of how far video has come for Amazon in the 2 1/2 years since it was first included in the $79/year Prime service.

Video - and other content/apps - are critical to Amazon because they all support two of the company's most important consumer-facing priorities: growing its highly profitable and sticky Prime service and supporting its line of Kindle devices in the fiercely competitive tablet market. Amazon's ability to successfully use video in service to these other businesses no doubt helps drive its willingness to spend heavily on content licensing and also to invest in its own original productions.

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I'm pleased to present the 189th edition of the VideoNuze weekly podcast with my weekly partner Colin Dixon of nScreenMedia. This week we debate whether Google's new $35 Chromecast media streamer is a game-changer or not. I'm in the former category and Colin is in the latter. The caveat to my enthusiasm is that I haven't used Chromecast yet so I'm going by the Google demo and description.

As I wrote yesterday, I really like how Chromecast integrates the TV with mobile devices - something that Smart TVs hadn't achieved, but which many consumers yearn for. For many video content providers outside the pay-TV ecosystem, Chromecast offers, at last, a clear path into the living room, with increased advertising and subscription potential. If the Chromecast SDK is straightforward, I'm betting many content providers / app developers will quickly integrate it. Even with currently limited content, Chromecast sales are apparently very strong.

On the other hand, Colin is more cautious. He sees Chromecast as more of a transitional product. Colin likes how it helps the Google/YouTube ecosystem in offering an easy TV viewing solution, but doesn't see other content providers being as motivated, given other device priorities. Colin highlights the key question of how broadcasters will react to Chromecast - will they try to block its access to their online TV programs as they did with Google TV? If this is possible and they succeed, it would diminish Chromecast's value proposition.

It's a very robust debate, with no clear answers just yet. But one thing is for sure: Google has clearly stirred up the connected TV space with Chromecast. Listen in to learn more!

Click here to listen to the podcast (22 minutes, 16 seconds)

Click here for previous podcasts

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The VideoNuze podcast is also available in iTunes...subscribe today!

By now, you've no doubt heard and/or read something about Google's clever new Chromecast HDMI device, a $35 media streamer introduced yesterday (Google's intro/demo video embedded below). Chromecast has a lot going for it, and could well become Google's first big hit product in the living room. If it does, there will be at least one significant consequence: instead of TVs continuing to become "Smart TVs," they are going to become dumb yet again. This would be a huge blow to TV manufacturers who have labored to convince consumers to spend extra to derive the benefits a Smart TV offers.

I don't think Google set out to kill Smart TVs with Chromecast, but I have no doubt the team recognized some of the serious shortcomings of today's Smart TVs and sought to capitalize on them. At the top of the list of Smart TVs' limitations are lack of integration with other devices, narrow content offerings and inability to entice developers.

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