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Analysis for 'PlayStation'

  • PlayStation Vue and HBO Max Underscore TV Industry’s Uncertain Economics

    Just before the WarnerMedia team took the stage to unveil details of HBO Max, Sony announced that would it shut down its 4 year old PlayStation Vue virtual pay-TV service on January 30th. The moves are 2 great examples of the constantly-shifting strategies of big media companies.

    PS Vue was an early mover in virtual pay-TV (or “vMVPD”). But if you think of the industry in 4 quadrant terms, with price on one axis and channel lineup on the other, PS Vue was relatively high on both - it offered a mostly complete channel lineup competitive with traditional pay-TV operators, but not at a significantly reduced price (which is the top motivator for prospects).

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  • Rethinking Skinny Bundles and Their Impact on Pay-TV

    VideoNuze readers know I’ve long been skeptical about the value proposition of virtual multichannel video programming distributors (“vMVPDs”) or “skinny bundles” as they’re commonly known. But as I touched on in last Friday’s podcast, based on some significant changes over the past year, I’m becoming more optimistic about skinny bundles’ prospects and their broader impact on pay-TV.

    To take a step back, 3 main concerns have driven my skepticism about skinny bundles: (1) their incomplete channel lineups (the “Swiss cheese” challenge of too many holes, or missing TV networks) which reduces their appeal relative to pay-TV’s traditional multichannel lineups, (2) the dubious profitability of skinny bundles, especially given underlying programming costs, which raises the question of just how committed the big parent companies of skinny bundles are to them, and (3) viewers’ migration away from linear TV in favor of SVOD, which is driving up cord-cutting.

    Here’s what’s changed:

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  • Broadcast TV Poised to Play Bigger Role in Skinny Bundles’ Success

    The competitive dynamics among skinny bundles are still developing, but one thing is becoming increasingly clear: including a full array of broadcast TV channels in all of the biggest U.S. markets, and even many of the smaller ones, will be table stakes. It seems as if a week doesn’t pass these days without one of the five major skinny bundles announcing a new carriage deal for certain broadcast channels in a variety of local markets.

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  • Report: TV Viewership Patterns and Economic Realities Indicate Difficult Path for "Skinny" Bundles

    So-called "skinny bundles" of TV networks face long odds of success given the dispersion of actual TV viewership, cross-ownership of broadcast-cable TV networks by media conglomerates and underlying economic realities, according to a new analysis by MoffettNathanson.

    The conclusions align with points I made in last Friday's podcast and previously, as I've asserted that the "Swiss cheese" channel lineups found in skinny bundles will lack broad appeal. This was a central finding from recent Bernstein research as well. Conversely, bulking up channel lineups with more TV networks (as Sony has done with its new PlayStation Vue service) eliminates the opportunity for a cost-savings value proposition that would resonate most with would-be cord-cutters or cord-nevers.

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  • Watching Reed Hastings at NewTeeVee Live

    Yesterday I had my own positive broadband video experience, remotely watching portions of the NewTeeVee Live conference held in SF from the comfort of my office. Om Malik and crew put together a packed agenda and I had wanted to go, but a personal conflict kept me in Boston.

    I caught most of Netflix CEO Reed Hastings' keynote (until the UStream feed froze up, arghh...) and thought he offered some interesting tidbits about how he sees the broadband video market unfolding. VideoNuze readers know I've been avidly following Netflix's recent moves with Watch Instantly and I've come to think of the company as one of three key aggregators best-positioned to disrupt the cable model (the other two being YouTube and Apple).

    Three noteworthy points that Hastings made:

    Standards needed to interface broadband to the TV - Hastings catalogued the efforts Netflix is making to integrate with various devices like Roku, LG, TiVo, Xbox, etc, but concluded by saying that these one-off, ad hoc integrations are not scalable and are really slowing the market's evolution. Most of us would agree with this assessment. Still, he was quite pessimistic about a standards setting process's ability to move quickly enough - saying this could be a 10-30 year endeavor. Instead, if I understood him correctly, he thinks the TV approach should just be browser- based, and also that today's remotes should be scrapped in favor of pointer-driven (i.e. mouse-like) navigation.

    Cable should evolve to focus on broadband delivery and de-emphasize multichannel packaging - Of course this is incredibly self-serving from Netflix's standpoint, but Hastings made the case that broadband margins for cable operators are nearly 100%, because they have no content costs, whereas on the cable side, they have high and ever-increasing programming costs. He cited Comcast's recent announcement of 50 Mbps service as evidence that cable operators should focus on winning the broadband war, and eventually letting go of the multichannel model. Nice try Reed, but I don't see that happening anytime soon. However, as I recently wrote in "Comcast: A Company Transformed," there's no question that broadband is becoming an ever greater part of its revenue and cash flow mix.
    (Reed emailed to clarify the above point. He didn't say cable should focus on broadband delivery over the current multichannel model; rather that cable - and satellite/telco - should focus more on web-like viewing experiences through improved navigation and VOD/DVR to be more on-demand, personalized and browser-friendly. And he added that with the shift to heavier broadband consumption, cable is a winner either way. Note - I thought I interpreted him correctly, but between UStream choking and my own scribble, it seems I was a bit off here. Thanks for correcting Reed.)

    Game consoles in leading position to bridge broadband to the TV - Hastings made a pretty strong case for the Wii - and to a lesser extent the PlayStation and Xbox - as the leading bridge devices. The Wii in particular could be a real broadband winner if it could support HD and Flash. As I've been thinking about broadband to the TV, I've concluded - barring anything from left field - that game devices, IP-enabled TVs and IP-enabled Blu-ray players are where the action will be concentrated for the next 3-4 years (this doesn't take account of forklift substitutes like a Sezmi or others sure to come).

    NewTeeVee has a good wrap-up of Hastings' talk as well, here. The video replay isn't up yet, but when I see it, I'll post an update.

    What do you think? Post a comment now!

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