I’m pleased to present the 372nd edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.
This week we discuss 4 stories that caught our attention in recent days. First, Viacom’s plan to anchor an entertainment-only skinny bundle without sports or news networks. Colin and I are intrigued, but for a variety of reasons are skeptical Viacom is the right company to lead this.
Next we turn to Facebook, which has made no secret of its interest in pursuing longer-form video. This week brought news of its initial partnerships and potential business models.
We then discuss Amazon Channels expansion into the UK and Germany this week, building on the US model for Prime users to easily subscribe to various SVOD services. Both of us have been very bullish on Channels for a while and see lots of potential for it in other geographies.
Finally we dig into Snapchat Shows, the fast-growing social network’s plan to enlist multiple media companies to make vertical videos. Variety did a really good roundup of all the activity earlier this week, which suggests substantial progress.
Listen in to learn more!
Click here to listen to the podcast (21 minutes, 48 seconds)
On yesterday’s Time Warner Q1 ’17 earnings call, HBO’s CEO Richard Plepler said that the company’s content licensing deal with Amazon would not be renewed and therefore would expire at the end of 2018. The deal was originally announced in April, 2014 and allowed Amazon to include iconic series like “The Sopranos,” “The Wire,” “Deadwood” and others in its Prime Video service.
Although Plepler cited “an acceleration in our digital business” as the reason for the decision, I believe that the more important driver at work is a repositioning of how the immensely valuable HBO will be used when AT&T’s acquisition of HBO parent Time Warner occurs later this year (assuming regulatory approval is granted, which I think is very likely).
I’m pleased to present the 366th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.
Once again, we’d like to thank our podcast sponsor Akamai Technologies, which will show its Media Acceleration capabilities and range of cloud-based solutions at the NABShow in Las Vegas, in booth SL3324. Click here to schedule a meeting.
This week rumors of two more online TV services surfaced on Bloomberg - one is an alliance of AMC, Discovery and Viacom and the other, from NBCU, would include programs from the company’s broadcast and cable TV networks. Both services appear to be in the mold of CBS All Access, with the AMC/Discovery/Viacom service being positioned as a sports-free and offered by pay-TV providers. Bloomberg said it was too early to tell whether sports or a linear feed of NBC would be included in the second.
At first blush, Colin and I are intrigued by both as they appear to target “entertainment-only” viewers who don’t care about sports. Netflix and Amazon, among others have been super-successful targeting this entertainment-onlys and we both believe there’s still growth available for additional services. We discuss the opportunity as well as potential stumbling blocks in this week’s podcast.
Listen in to learn more!
Click here to listen to the podcast (21 minutes, 35 seconds)
Downloading video for offline playback continues to gain momentum with Showtime announcing late last week that it has enabled downloading of its entire roster of programs from its standalone subscription and TV Everywhere apps at no additional cost. Downloading is available on iOS and Android phones and tablets plus Amazon Fire tablets.
Loyal VideoNuze readers know that I’ve been an enthusiastic downloading proponent for 4 1/2 years, back to when I first experienced TiVo’s implementation of it via TiVo Stream. I immediately saw downloading as a killer app because it allowed high quality out-of-home viewing independent of shaky or non-existent WiFi hotspots and/or eating up expensive mobile data plans (if they could even support video streaming).
Recode reported a couple days ago that Apple is potentially looking to sell online subscriptions to HBO, Showtime and Starz in a single bundle to subscribers. Since Apple has made so little progress in video compared to its peers, a bundling move like this could give it a boost. But if I were handicapping which company is much more likely to sell HBO, Showtime and Starz in a discounted bundle - and succeed with it - I’d put my money on Amazon far sooner than Apple.
Showing growing confidence in its ability to deliver more precise ads for clients, NBCUniversal announced this morning that it is committing $1 billion of ad inventory in advance of the upfronts for clients who want to buy targeted ads across NBCUniversal’s portfolio. The move is the latest by TV networks to enable data-driven ad buying in order to better compete with digital behemoths like Google and Facebook which are increasingly pursuing traditional TV ad dollars.
With the move, NBCUniversal is guaranteeing that data-driven campaigns will deliver “precisely defined customers” on its platforms, part of its “Symphony” strategy of tapping into all of its broadcast and cable TV networks, digital properties, distribution partners, theme parks and talent.
I’m pleased to present the 357th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.
First up, Colin shares his experiences streaming the Super Bowl on numerous services and devices. Overall the video quality was pretty strong, especially on Sling TV. Colin also used the Fox VR app with Google Cardboard and relays his reactions.
While Super Bowl LI was one of the best-viewed in history, NFL ratings this past season declined across the board and we discuss what’s likely happening. As I wrote earlier this week, the wide adoption of ad-free SVOD feels like a major culprit.
We then transition HBO Now, which Time Warner reported earlier this week now has over 2 million subscribers. Neither Colin nor I are super-impressed with HBO Now’s growth, especially by comparison with Netflix’s performance in the same time period. We both think HBO Now’s relatively high price of $15/month is the key issue.
Listen in to learn more!
Click here to listen to the podcast (25 minutes, 53 seconds)
Time Warner’s CEO Jeff Bewkes said on this morning’s earnings call that HBO Now has passed the 2 million subscriber mark. That would be an increase from the 800K HBO Now had at the end of 2015.
On the one hand, gaining 2 million subscribers since launching HBO Now in April, 2015 is a positive sign of market acceptance for the SVOD service, which entered the market relatively late. But on the other hand, the pace of HBO Now’s monthly subscriber additions seems static, suggesting the service has not been able to accelerate its momentum.
In an interview at Lionsgate’s first investor day, Liberty Media chairman John Malone praised Netflix as having a “nirvana business model” while calling out traditional pay-TV distributors for being “asleep at the switch” as their legacy “toll gate” video business models were disrupted. Malone highlighted Netflix’s direct-to-consumer, global scale and complete control as key benefits.
However, Malone wasn’t all doom and gloom about traditional pay-TV distributors, which he sees as morphing from being “video delivery businesses” to “connectivity businesses.” Malone thinks this change in mindset will lead to distributors breaking with tradition and offering premium networks such as Starz in combination with broadband, as opposed to being available only on top of multichannel bundles. But he would not provide any timetable for when this shift might occur.
When HBO Now launched in April, 2015, its $14.99/month price was well above competing SVOD services such as Netflix ($11.99/month), Hulu (ad-free $11.99/month) and Amazon ($8.99/month or included with Prime for $99/year). On the one hand, an argument could be made that an HBO subscription is more valuable due to HBO’s rich library and therefore should be priced higher than newer competitors. But HBO’s market-skimming high price strategy means its more aggressively priced competitors are growing far faster than HBO, enabling them to have greater scale, which will be the key to future success.
In an interview this morning at the Paley Center, Turner Chairman and CEO John Martin hit on several key themes he believes will be critical to the company’s future success. Specifically, Martin cited business flexibility, the power of data, the shift to audience-based ad sales and mobile. Following are some of the details of the interview, which was conducted by the Guardian’s Matthew Garrahan.
I'm pleased to present the 339th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.
First up this week we discuss Time Warner’s investment earlier this week in You.i TV, a video app development platform. Colin notes that the acquisition furthers Turner’s strategy of owning its own technology and going direct-to-consumer. From my standpoint, You.i TV is critical in streamlining Turner’s app development across multiple connected devices, where viewing is migrating.
We then transition to talking about skinny bundle research from Altman Vilandrie & Co., which I wrote about yesterday. The data confirmed my skepticism about how difficult it will be for skinny bundle providers to offer sufficiently comprehensive channel lineups while still enticing subscribers with cost savings. We dig into some of the most salient data points.
(apologies, the recording quality was a little sub-par this week)
Listen now to learn more!
Click here to listen to the podcast (22 minutes, 16 seconds)
New research from consulting firm Altman Vilandrie & Company highlights the major challenges that current and pending “skinny bundles” face. Skinny bundles - which are scaled down, customized and less expensive groups of TV networks - have become a hot industry topic, and are perceived as valuable in pulling cord-cutters and cord-nevers back into the pay-TV ecosystem.
But AV&Co.’s 7th annual consumer video survey, which is the most extensive research that I’ve seen yet into the prospects for skinny bundles, paints a picture of how narrow the opportunity may in fact be. VideoNuze readers know that I’ve been very skeptical of skinny bundles, whether from Sling TV, PlayStation Vue or soon Hulu and DirecTV Now. The AV&Co. research largely confirms my concerns (see here and here).
Topics: Altman Vilandrie
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.
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!
Click here to listen to the podcast (24 minutes, 2 seconds)
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.
One of the most interesting panel discussions at the recent Video Ad Summit was “Reaching Audiences at Scale: Will TV Succeed in the Digital Age?” which included Adam Gerber (SVP, Client Development & Communications, ABC), Mike Germano (Chief Digital Officer, VICE Media), Melissa Kihara (Global VP of TV & Video Products, Xaxis), Bob Toohey (President, Verizon Digital Media Services) and Lorne Brown (Founder and CEO, Operative) moderating.
It’s no secret that video viewing is fragmenting and linear TV is declining as new video sources proliferate and behaviors change. Still, TV networks are running fast, distributing programs in new ways, investing heavily in data to better enable targeting by advertisers and leveraging social media to better engage viewers.
As Adam pointed out, research suggests that scale in long-form ad-supported online viewing is dominated by TV networks. But as he also pointed out, scale in data and audiences is dominated by platforms like Facebook and Google. This is one of the key sources of tension for advertisers - how to combine the best of both, to achieve scaled, targeted, efficient, effective, trusted advertising in premium video?
The panelists agreed that for lots of reasons the market is nowhere close to reaching this nirvana state. They explored all the reasons why, along with things that are being done to move the ball forward. For anyone trying to better understand how TV is evolving in the digital age and what role it will play, it’s a fascinating discussion.
Watch the video now (39 minutes, 48 seconds).
Turner announced this morning that it will launch a new ad-free SVOD service this Fall dubbed FilmStruck, which will be managed by Turner Classic Movies and exclusively draw on movies from Criterion Collection. According to the release, FilmStruck is targeted to “diehard movie enthusiasts who crave a deep, intimate experience independent, foreign and art house films.”
A Turner spokesperson confirmed that Criterion’s 1,000 movie catalog will move over from Hulu in November, where it has been under an exclusive deal announced in February, 2011 and extended in April, 2014.
The never-ending tussle between pay-TV operators and sports TV networks over escalating carriage fees is back in focus due to the standoff between Comcast and the YES Network, which has the rights to broadcast New York Yankees games, among others. Comcast dropped YES last November, leaving approximately 900K of its New York area subscribers without access to YES. With the Yankees’ opening day one week from today, the standoff is going to gain much more attention.
As with other sports TV carriage disputes, this one boils down to money and audience. Comcast is arguing that YES’s demand for a reported $6 per month per subscriber isn’t justified given its ratings. Last November Comcast said that over 90% of its subscribers didn’t watch the equivalent of even one quarter of the 130 games YES broadcast in 2015. Nielsen said that YES averaged 250K viewers in 2015, a decrease of 44% vs. its peak of 450K in 2007.
TV programmers like Viacom and AMC are in the same position that print companies like The New York Times and Conde Nast were ten years ago. As consumers moved to reading content online, the legacy publishing companies figured they could replicate their business on a new channel. No one could believe that a tech company with no real content could compete for brand advertising budgets. We all know how that played out.
Now, consumers are cutting the cord and moving to digital channels to watch TV. There is more to lose on both the buy and sell side during this time around. TV advertising is considered by advertisers to be the holy grail of inventory, and they don’t want to lose it any more than the TV companies do. However, the siren song of audiences at scale and with technical ease could change their minds.