There was nothing surprising when I read last week’s coverage of FX CEO John Landgraf’s tally of original productions in 2019. According to Landgraf, the number of original dramas, comedies and limited series across all SVOD and TV networks in the U.S. reached a new high of 532 (approximately what he previously predicted). That was up from 495 in 2018, 487 in 2017 and just 182 in the pre-SVOD days of 2002.
This dynamic, which Landgraf has dubbed “Peak TV,” is leading many, if not most, ad-supported entertainment-oriented cable TV networks onto a road to nowhere if their goal is to remain ad-supported entertainment-oriented cable TV networks in the long-term. What is far more likely is that being this type of network will become unviable and so they’ll morph into studios that provide premium original and library content, mostly for bigger platforms (e.g. Amazon, Netflix, Apple, Hulu, etc.) and sometimes for their parent companies’ direct-to-consumer OTT services.
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.
I’m pleased to present the 488th edition of the VideoNuze podcast, with my weekly partner Colin Dixon of nScreenMedia.
On this week’s podcast, Colin and I explore how powerful partnerships can be in the increasingly competitive SVOD space. First, Colin shares details on the Amazon-Premier League partnership which was first announced in June, 2018, but will be implemented for the first time in December, 2019. Under the deal Amazon has exclusive streaming rights to 2 blocks of 10 Premier League games. Colin crunched the numbers on what the deal could be worth to Amazon in the UK.
Then we turn our attention to the Verizon-Disney+ partnership announced earlier this week, in which Verizon's unlimited plan wireless subscribers will gain a full free year of Disney+. The deal could easily jumpstart Disney+ with several million subscribers.
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Click here to listen to the podcast (21 minutes, 35 seconds)
I’m pleased to present the 486th edition of the VideoNuze podcast, with my weekly partner Colin Dixon of nScreenMedia.
Colin and I were both excited to see Hulu launch a mobile video downloading feature this week. Hulu had teased the feature over a year ago. As Colin notes though, because it’s only available with the Hulu (No Ads) service and only on iOS devices, just around 15% of Hulu’s overall subscribers will gain access to downloading (at least for now).
We then discuss reports that Disney doesn’t yet have an agreement with Amazon for its forthcoming Disney+ service to be included in Fire TV devices. The deal is held up due to Amazon’s attempt to wrangle more ad inventory in Disney’s other apps. The situation is typical of the complex and sometimes competitive relationships between big media and technology companies today.
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Last week, the WSJ ran two articles that underscore how Disney is navigating new terrain as it prepares to launch Disney+ in November. The articles also showcase how convoluted relationships among major media and technology companies are going to become over fights for shifting leverage.
One article described how Disney has continued to ban advertising from Netflix on its entertainment TV networks (ESPN is still ok) even though it will accept ads from other SVOD providers. The other article described Disney’s negotiations with Amazon over how much ad inventory Amazon should be allocated to sell in Disney’s apps that run on Fire TV. The article noted no deal at all has been reached for Disney+ to be carried on Fire TV, as the SVOD service’s launch date nears.
Discovery announced an intriguing direct-to-consumer offering yesterday called “Food Network Kitchen” in collaboration with Amazon. While SVOD announcements seem to occur on a near-daily basis, Food Network Kitchen has different ambitions, combining daily live and interactive cooking classes hosted by celebrity chefs along with a deep on-demand library of classes, plus viewing and voice navigation using Amazon Alexa and Fire TV devices. iOS and Android mobile devices will also be supported when Food Network Kitchen launches next month, with others coming next year.
Categories: Cable Networks
I’m pleased to present the 474th edition of the VideoNuze podcast, with my weekly partner Colin Dixon of nScreenMedia.
First up this week Colin and I discuss the “detente” that Amazon and Google seem to have achieved, announcing earlier this week that the Prime Video and YouTube apps will be supported on each other’s CTV devices. That’s good news for viewers who have had incomplete experiences.
Then Colin describes a new service Amazon’s Twitch has launched called Twitch Prime. Colin sees it as another opportunity for Amazon to drive value back to the Prime service and even create new Prime subscribers. Last, Colin shares some new data illustrating that even though Prime Video has made progress in video, its original programming is still not at Netflix’s level.
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Frustrated Chromecast and Fire TV users can now breathe a sigh of relief: parent companies Google and Amazon have announced that apps for YouTube and Prime Video are officially available the other company’s CTV devices. That means Prime Video can be cast once again using Chromecast and is on Android TV devices. And YouTube’s app is available on Fire TV Stick (2nd gen), Fire TV Stick 4K, Fire TV Cube, Fire TV Stick Basic Edition, and Fire TV smart TVs (e.g. Toshiba, Insignia, Element, Westinghouse).
Yesterday eMarketer shared its U.S. advertising forecast for 2019, predicting that digital ads will account for $129.3 billion or 54.3% of spending, while traditional ads will drop to 45.8% of the market. eMarketer said it’s the first time digital will surpass traditional in share of market.
Digital has been on a trajectory for years to achieve this milestone, so in a sense there’s no major surprise here. What is a surprise is the outsized role that Amazon is playing in both growing the digital ad market and taking a bigger slice of it - and how quickly this has happened.
eMarketer believes that in 2019 Amazon will take nearly 9% of digital ad spending, chiseling into Google’s and Facebook’s (the “duopoly”) combined share which stood at 60% in 2018 but is forecast to drop to 59.3% in 2019. eMarketer cites Amazon’s “shoppers’ behavioral data for targeting and provides access to purchase data in real time” which was previously only available to advertisers/agencies through retail partners.
I’m pleased to present the 449th edition of the VideoNuze podcast (and our first of the new year!), with my weekly partner Colin Dixon of nScreenMedia.
On this week’s podcast, Colin and I discuss why we both believe most subscription video services will trend away from a pure direct-to-consumer (DTC) model and instead embrace large platforms for distribution. Roku’s plan to support subscription services (following Amazon Channels and Apple’s TV app) bolsters the trend.
There are numerous benefits to third party distribution for both content providers and consumers. DTC will still have a place in go-to-market strategies, but it will become smaller, except for major players like Netflix and Hulu.
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Click here to listen to the podcast (21 minutes, 10 seconds)
Yesterday’s announcement by Roku, that it would begin offering SVOD and ad-free premium cable TV networks (what Roku calls “Premium Subscriptions”) within The Roku Channel, is the latest sign that subscription video services are turning to bigger third party platforms to add and retain paying subscribers. Despite all the industry excitement over direct-to-consumer (“DTC”) business models, third party distribution remains critical.
Roku’s move evokes what Amazon has been doing with its Amazon Channels program for just over 3 years, which I've been bullish on from the beginning. Prime subscribers are able to choose from dozens of different small and large SVOD services and premium cable TV networks and have the fees billed directly to their credit card on file with Amazon. Free trials are commonplace and the content is viewed seamlessly within the Prime Video app on multiple devices.
I’m pleased to present the 448th edition of the VideoNuze podcast, with my weekly partner Colin Dixon of nScreenMedia.
Continuing our tradition for our final podcast of the year, this week Colin and I discuss the top 10 video stories of 2018 - at least in our humble opinions. Once again it has been a very active 12 months, with lots of innovation and change. Colin and I have had a great time analyzing and discussing the critical industry trends each week and we hope you’ve enjoyed listening to our thoughts in 2018.
Let us know what you think of our choices, whether you agree or disagree!
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Click here to listen to the podcast (37 minutes, 16 seconds)
Some great reporting from Ad Age over the past couple weeks reveals how Amazon and Google are ramping up in premium video advertising. Given the size and respective positioning of both companies, their initiatives are worth paying close attention to.
First, on Google, Ad Age reported that YouTube has begun to offer feature length movies like “The Terminator,” “Rocky” and “Legally Blonde” for free and with ad support (note all are also available on The Roku Channel). They’re part of around 100 movies YouTube has collected in a bid to further boost YouTube viewership and give advertisers more access to premium, brand safe content.
If you’re looking for more evidence of how SVOD is changing the TV landscape, look no further than last night’s Emmy Awards. The 3 big SVOD providers, Amazon, Hulu and Netflix combined to win a record 35 Emmys, up from 32 in 2017. Netflix itself won 23 Emmys, tying HBO for top honors, with Amazon winning 8 and Hulu winning 4.
Netflix’s big winner was “The Crown” which took home 5 Emmys. All of Amazon’s awards were for “The Marvelous Mrs. Maisel” including outstanding comedy series, lead actress (Rachel Brosnahan), supporting actress (Alex Borstein) and writing and directing for Amy Sherman-Palladino. Maisel tied with Saturday Night Live for second place behind “Game of Thrones” which won 9, including outstanding drama series.
I’m pleased to present the 434th edition of the VideoNuze podcast, with my weekly partner Colin Dixon of nScreenMedia.
First up this week, Amazon is said to be planning a free ad-supported video service, similar to Roku’s The Roku Channel. The new service, dubbed Free Dive, would be targeted to the nearly 50 million Fire TV users. Colin and I both like the move a lot, as we see multiple promotional and new revenue benefits, especially if Amazon can attract TV ad dollars. However, a key challenge is finding enough compelling content to make Free Dive interesting to audiences.
We then transition to talking about Hulu. Colin has developed a forecast for subscriber and revenue growth for Hulu through 2020 which he explains. He sees much of Hulu’s revenue growth coming from its Live skinny bundle service, although its profitability will remain challenged due to high programming costs.
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Add Amazon to the growing list of companies that are gunning for their share of TV ad dollars. According to a report in The Information, Amazon is planning to launch a free, ad-supported video service for its Fire TV users that may be called Free Dive. As described, Free Dive looks to be very similar to Roku’s The Roku Channel, which is available to Roku users and as of a few weeks ago also on the web.
For Amazon, the move makes perfect sense in a number of different ways. First, it’s a great complement to the growing array of paid video options Amazon offers (TV programs/movies in Prime, SVOD services in Amazon Channels, transactional, etc.). Free, ad-supported video gives Amazon its own inventory to promote all of these paid services in various ways.
I’m pleased to present the 430th edition of the VideoNuze podcast, with my weekly partner Colin Dixon of nScreenMedia.
This week Nielsen released its Q1 ’18 Total Audience Report, which led to some media coverage that linear TV still dominates consumer viewing. However, Colin dug into the data and showed that while this is true for older consumers, for younger ones, the exact opposite is occurring: linear TV is becoming less and less relevant. Colin shares his analysis.
On-demand viewing’s importance was underscored yet again this week by Comcast striking a deal to integrate Amazon Prime Video into its X1 experience. The move builds on prior Netflix and YouTube integrations, helping Comcast broaden X1’s value proposition. However, neither of us thinks the move materially addresses aggressive competition from skinny bundles that drove up Comcast’s video subscriber losses in Q2.
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Click here to listen to the podcast (23 minutes, 28 seconds)
Comcast will integrate Amazon Prime Video into its X1 platform later this year. Amazon becomes the third major streaming service to be included in X1, following Netflix in 2016 (see here) and YouTube in 2017 (see here). Comcast said it’s the first pay-TV operator to integrate Amazon.
As with the other services, Amazon’s content will become available to X1 users as part of the X1 UI. Comcast is continuing to position X1 as a streamlined gateway to both its own content and also to third-party content. It’s a smart move by Comcast to build more value into the X1, helping justify subscribers spending $10 or more per month to rent the X1 set-top box (although Comcast has recently been emphasizing it sees X1 also as an interface, living on smart TVs and devices, as well).
Comcast has officially dropped out of the bidding for the 21st Century Fox assets, clearing the path for Disney to move forward. Comcast still plans to pursue Sky in the UK. But by dropping its Fox bid, Comcast has also foregone the opportunity to take control of Hulu (by virtue of combining its 30% stake with Fox’s 30% stake). Presumably now Disney will take control of Hulu.
I believe this is a major missed opportunity for Comcast, leaving the company under-optimized in the fast-changing premium video industry. As we all know, today’s key industry themes include the rise of cord-cutting and consumers’ move to lower cost skinny bundles, the shift to on-demand viewing, with the accompanying growth of ad-free SVOD services (e.g. Netflix, Amazon, Hulu), the rapid adoption of connected TV and mobile devices for viewing and the nationalization/globalization of video services, among others.
Yesterday Netflix announced a very cool new feature called “Smart Downloads,” which automatically deletes an episode you’ve downloaded and finished watching on your mobile device, triggering the download of the subsequent episode. The process happens as soon as you’ve connected to WiFi and occurs invisibly in the background. Smart Downloads is available for Android devices now and for iOS devices later this year.
Smart Downloads is a clever way of automating a manual process, so that users always have something downloaded and ready to watch (although having to manually download a TV episode clearly falls in the category of “first world problems”). Smart Downloads is a a savvy move by Netflix to increase subscribers’ engagement time, which in turn leads to higher satisfaction and better retention. But perhaps most fascinating about Smart Downloads is that it illustrates how fully and quickly Netflix has evolved from an avowed downloading skeptic to an impressive innovator.