Hulu has announced that it has distribution deals with 5 small-to-mid-sized U.S. pay-TV operators: Armstrong, Atlantic Broadband, Mediacom, Midcontinent and WideOpenWest (WOW!). The deals follow last week's news that Hulu has signed up Cablevision as the first U.S. pay-TV operator to distribute its service.
Like the Cablevision deal, there weren't a lot of specific details shared about pricing or packaging. The 5 operators will be able to offer Hulu's content on their advanced set-top boxes. While the set-tops aren't identified, a number of these operators use TiVo DVRs as their advanced set-tops to offer integrated OTT/pay-TV/VOD experiences.
Netflix will be integrated by 3 small U.S. cable TV operators via TiVo, per a joint announcement by the companies. Atlantic Broadband, Grande Communications and RCN will begin integrating Netflix in multiple ways: by assigning Netflix its own channel in their on-screen guides, exposing the Netflix app for quick access to sign-up or login and incorporating Netflix content in recommendations and search results alongside linear, VOD and the subscriber's DVR content.
For Netflix, the deals follow similar implementations in Europe with Virgin and Com Hem. Netflix has avidly pursued inclusion in the primary pay-TV experience, helping it become even more mainstream by eliminating the step of switching inputs to a connected device. Another benefit to Netflix is the cable operators will also integrate with Netflix's Open Connect content delivery platform.
There are many different ways to think about the deals; below are 5 of my key takeaways:
TiVo's acquisition of Digitalsmiths for $135 million, announced yesterday, is further evidence of the cloud's increasingly important role in powering video discovery on TVs and devices. According to Jeff Klugman, TiVo's EVP/GM of Products/Revenue, who shared background on the deal with me, Digitalsmiths' leading cloud-based content discovery and recommendations technology will give TiVo greater flexibility to serve pay-TV operators with branded and white label solutions independent of TiVo's hardware.
Clearleap announces Atlantic Broadband as first public customer - Clearleap, the Internet-based technology firm I wrote about here, announced Atlantic Broadband as its first public customer. Atlantic is the 15th largest cable operator in the U.S. I spoke with David Isenberg, Atlantic's VP of Products, who explained that Clearleap was the first packaged solution he's seen that allows broadband video to be inserted into VOD menus without the need for IT resources to be involved. Atlantic initially plans to use Clearleap to insert locally-oriented videos into its local programming lineup. It also has special events planned like "Operation Mail Call." which allows veterans' families to upload videos, plus coverage of local sports, and eventually filtered UGC. By blending broadband with VOD, Isenberg thinks Clearleap gives him a "giant marketing tool" to raise VOD's visibility. As I've said in the past, VOD and broadband are close cousins which can be mutually reinforcing; Clearleap facilitates this relationship.
New Balance's "Made in USA" video - Have you seen the new 3 minute video from athletic shoemaker New Balance? Yesterday I noticed a skyscraper ad for it at NYTimes.com and a full back-page ad in the print version of the Boston Globe. New Balance's video promotes the fact that it's the only athletic shoemaker still manufacturing in the U.S. (though it says only 25% of its shoes are made here). There's also a fundraising contest to win a trip to one of its manufacturing facilities. Taking ads in online and offline media to drive viewership of a brand's original video is another way that advertising is being reimagined and customers are being engaged.
Joost - R.I.P.-in-Waiting - There's been a lot written this week about Joost's decision to switch business models from content aggregation to white label video platform provider. Regrettably, I think this is Joost's last gasp and they are in "R.I.P.-in-waiting" mode. Joost, which started off with lots of buzz and financing ($45M) by the co-founders of Skype and Kazaa, is a cautionary tale of how quickly the broadband video market is moving, and how those out of step can get shoved aside. Joost made a critical strategic blunder insisting on a client download based on P2P delivery when the market was already moving solidly in the direction of browser-based streaming. It never recovered. Given how crowded the video platform space is, I'm hard-pressed to see how Joost will carve out a substantial role.
Cablevision wins its network DVR case - Not to be missed this week was the U.S. Supreme Court's decision to refuse to hear an appeal from programmers regarding cable operator Cablevision's "network DVR" plan. The decision means Cablevision can now deploy a service that allows subscribers to record programs in a central data center, rather than in their set-top boxes. This leads to lower capex, fewer truckrolls, and more storage capacity for consumers. There's also an intersection point with "TV Everywhere," as cable subscribers will potentially have yet another remote viewing option available to them. Content is increasingly becoming untethered to any specific box.