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Analysis for 'Sanford Bernstein'

  • VideoNuze Podcast #265: Can Apple Succeed With a "Skinny" Bundle of TV Networks?

    I'm pleased to present the 265th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. There's been a lot of buzz this week about a WSJ report that Apple could at last be planning to enter the TV business, by offering a so-called "skinny" bundle of around 25 TV networks this Fall.

    In today's podcast, Colin and I debate whether Apple can succeed with this approach. Colin is relatively sanguine, and believes that if Apple ties the TV service's launch to a new device, it could get a lot of traction. Colin sees Sling TV's skinny bundle as a model for Apple to follow.

    I'm much more skeptical about the skinny approach, and despite Apple's formidable assets, I'm challenged to see how it works. My main issue is that by definition, skinny bundles result in a "Swiss cheese" channel lineup that is unsatisfying for many viewers (this was supported by Bernstein research I wrote about earlier this week). Another issue for Apple, which reportedly wants to include broadcast TV networks (which Sling doesn't include), is the near-certainty that it won't get full linear rights in all U.S. markets, undercutting the service's ubiquity.

    At a minimum it will be fun to watch what Apple does, along with everyone else. Reminder, to help us all gauge these new OTT services' potential, check out the handy scoring framework I shared yesterday.

    Listen in to learn more!



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  • New Focus Group Research Reveals Minimal Interest in Cord-Cutting

    It turns out that where's there's smoke there isn't always fire. If you were to believe the media's rampant attention to cord-cutting, you'd think it was poised to skyrocket. But new research from Bernstein reveals that while there's interest in cord-cutting among actual pay-TV subscribers, their plans to actually do so are quite minimal.

    In the first of a series of focus groups of pay-TV subscribers, held in New York City, Bernstein surfaced a variety of reasons why pay-TV is stickier than a lot of people may like to believe. Even those participants who had identified themselves as "highly likely to cut the cord in the next 6 months" concluded that doing so would not be advantageous. Practically all the participants currently subscribe to OTT services like Netflix, Hulu and Amazon.

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  • Research: TV Networks' Viewership Continues Falling, With Structural Shift to SVOD Looming

    Bernstein Research has introduced a new weekly tracking report analyzing ad-supported U.S. TV networks' viewership on a year-over-year basis. The first version, released today, shows that for the week of November 10-16, audiences fell again across the board: down 8% for cable networks, 9% for broadcast and 17% for kids-oriented networks specifically. The declines were similar on a quarter-to-date basis as well.

    Bernstein has previously calculated that ad-supported TV networks' audiences declined by around 13 minutes per day in Q3, while SVOD viewership increased by around 12 minutes per day, making SVOD the dominant driver of the TV networks' audience erosion.

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  • VideoNuze Podcast #249 - Is SVOD Finally Biting Into TV Ratings and Advertising?

    I'm pleased to present the 249th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia.

    This week we tackle a topic that has gained a lot of recent attention - whether SVOD services (e.g. Netflix, Amazon, Hulu, etc.) are starting to bite into broadcast and cable TV networks' ratings and advertising revenues. The mantra from TV network executives and their studio brethren over the past few years has been that SVOD licensing revenue was purely incremental to their ad revenue.

    But a slew of Q3 data, including large declines in C3 viewing (especially among under 49 year-olds), flat-to-down TV ad revenues being reported by TV networks and excellent new analysis from researchers at Bernstein, MoffettNathanson and elsewhere suggest that we may actually be at the beginning of structural audience shift from linear/TV to SVOD, with TV advertising dollars leaking over to digital and online video.

    This would obviously be significant new challenge for TV networks/studios, all the more so because their own content licensing deals are the key enabler of SVOD services' appeal in the first place - and thus the shift.

    It's a fascinating topic with many long-term implications…listen in to learn more!

    (And note, we will dig deep into this topic at the Dec. 4th VideoSchmooze NYC in our opening session with Nielsen's SVP, Client Insights Dounia Turrill and Leichtman Research Group's President and Principal Analyst Bruce Leichtman. Register now to save and to win a TiVo Roamio Plus with Lifetime service!)



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  • Survey: Interest in Google Fiber Strong Among Early Adopters

    Investment firm Bernstein Research has released the results of a proprietary door-to-door survey of 204 Kansas City households which reveals strong interest in Google Fiber service among early adopters, with potentially strong adoption rates among mainstream audiences longer-term as well.

    Bernstein found very high awareness of Google Fiber, with 98% of respondents being aware of the service, no surprise given the level of local coverage it has received. Of the 204 respondents, 52% said they would definitely or probably buy Google Fiber and 25% said they may.

    However, recognizing the difference between what people say they'll do vs. what they'll actually do, Bernstein forecasts that 15-20% of homes will in fact subscribe to Google Fiber in the first phase of its rollout. Given the uncertainties around competitive responses to Google Fiber, Bernstein is less clear about longer-term adoption, though it is suggesting 40-50% is possible eventually.

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  • Why Has the Definition of "Cord-Cutting" Become So Squishy?

    Since Q2 '11, when the pay-TV industry lost video subscribers for the first time, there has been a debate raging over the impact of "cord-cutting." Flash forward a year, and anyone hoping for some clarity on this critical question would arguably be even more confused. Read certain media coverage of the pay-TV industry's Q2 '12 results and you'd conclude cord-cutting was gaining traction; read others and you'd conclude it wasn't. A key reason for the murkiness: somehow over the past year the definition of "cord-cutting" has become very squishy.

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  • Here's The REAL Problem DOJ Should Be Focusing On In Its New Cable Probe

    The WSJ has broken a big story this morning that the Department of Justice is apparently pursuing an antitrust investigation into whether cable TV companies are taking steps to limit the rise of online video usage. The DOJ is primarily looking into the role of data caps, the use of private networks for delivery of certain programming to connected devices, the use of TV Everywhere authentication, and even the model of most-favored nations clauses between cable TV networks and pay-TV distributors.

    While it's generally a good thing for the government to keep an eye on how business is conducted (the recent financial crisis demonstrates what happens when it doesn't), to my mind none of these issues are really hurting consumers, yet anyway. Rather, if the government truly wanted to focus on an immediate, huge, and worsening consumer problem in the pay-TV business, it should be focused squarely on sports, and more specifically the multi-billion dollar annual subsidy that non-sports fans are required to pay due to current cable network bundling practices.

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  • Are Pay-TV Providers Getting Hit By a Perfect Storm in Q3?

    The U.S. pay-TV industry, which as a whole lost multichannel video subscribers for the first time in Q2 '10, may be heading for a soft 3rd quarter as well. As Multichannel News reported yesterday, Time Warner Cable's CFO Rob Marcus said at a conference this week that Q3 "video net losses are pacing ahead" of where they were in Q3 '09. He attributed the downturn to recession-related factors of high unemployment, high home vacancy rates and slow new home formation. Though that's a fair explanation, it's only one element in a perfect storm pay-TV operators now find themselves battling.

    Aside from the above recession-related matters, pay-TV operators are also up against belt-tightening that's rooted in basic household economics. As Craig Moffett at Sanford Bernstein pointed out in a note last weekend, in the past 25 years, cable and satellite spending has increased from 1/2 of 1% of discretionary spending to 1.4%, a growth rate that's triple other household discretionary line items.

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