Posts for 'Broadcasters'

Flipping through yesterday's Best Buy circular, I noticed an ad (see below), which I believe is indicative of the type of pitches that are going to become increasingly prevalent to prospective cord-cutters and cord-nevers. The ad offers a packaged discount to an over-the-air ClearStream HD antenna from Antennas Direct with a TiVo Premiere and highlights logos from Netflix, Hulu Plus and Pandora. While the ad doesn't explicitly say "Dump your expensive pay-TV service now!," it has several key messages that might as well.

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I'm pleased to present the 169th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. First up today, we review the latest video industry litigation, Cablevision vs. Viacom. We mostly agree that major industry change is unlikely to occur due to the litigation, but rather, over time, the expense of pay-TV and appeal of OTT alternatives will drive changes in consumer choices, which in turn is what will change the pay-TV industry's dynamics.

Speaking of changing dynamics, it's no secret that live TV viewing is under huge pressure as viewers turn to on-demand choices and DVR usage. To help reverse things, Colin discusses an interesting new initiative announced this week by Fox and Watchwith. Fox will be syndicating its FOX NOW "sync-to-broadcast" second screen companion content via Watchwith to numerous network partners such as Shazam, Viggle, ConnecTV and NextGuide, helping drive higher usage and monetization. As Colin wrote earlier this week, it's a clever way of proliferating FOX NOW content and improving the live experience.

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Aereo announced this morning that it has expanded service to 19 million residents in 29 counties in the New York City metro area, moving Aereo beyond the 5 boroughs. The move is part of Aereo's nationwide expansion to 22 additional markets throughout 2013.

In addition, Aereo took the wraps off its first consumer marketing initiative, with executions emphasizing its live, DVR and portability features. The ads will be placed on billboards, phone kiosks and main transit points in NYC. Importantly, they each carry the company's tagline: "Live TV. Online. No Cable Required." which pointedly positions the company as a cord-cutting option (see below for an example), as I explained recently would happen.

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I attended the D: Dive Into Media conference earlier this week for the first time. It is mainly a series of one-on-one interviews with senior executives from a variety of media and technology companies, plus networking. Overall it was a great conference, and it's hard to beat a couple of days in beautiful Dana Point, CA, especially when coming off a blizzard in Boston.

My main interest was the video-related sessions, and from those I had 6 takeaways which I share below (along with selected session video clips), in no particular order:

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Broadcast TV networks continue to find themselves in the middle of a ton of innovation, as clever entrepreneurs look for ways to help viewers discover and consume their content. The latest entry in this space is a startup called Fredio ("FREE-d-oh") which announced its launch at CES. Fredio enables viewing on smart TVs of freely available TV programs that are posted online.

The proposition is relatively simple: all broadcast TV networks, and some cable TV networks (for certain shows), have been putting their episodes online for years now. But if you want to watch them you're typically limited to viewing on your computer, tablet or smartphone. If you want to watch on your smart TV, you're out of luck because no apps exist, with the exception of Hulu Plus, which requires a subscription

Fredio aims to change that by creating a free app for smart TVs that crawls the web for free TV shows. The app then categorizes them by network, allowing quick search and personalization through a straightforward UI (limited online demo here). You'll also be able to search Fredio online or on its tablet/smartphone app, select shows there and have them ready to play on your smart TV. When a show is selected, Fredio simply calls the network's web site to initiate the stream.

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I'm pleased to present the 162nd edition of the VideoNuze podcast with my weekly partner Colin Dixon, who is back from spending several days at CES. Though Colin concedes he didn't see anything that really "blew his socks off," he does share specific reactions to what he saw in second screen apps, UltraViolet, home gateways, Ultra High-Definition TVs, Google TV and incremental improvements in Smart TVs.

One thing that did get Colin jazzed was Near Field Communications (NFC), which allows devices to talk to each other, simply by touching. Colin describes it as "magic" and was quite impressed.

We then shift topics to discuss Aereo, which earlier this week announced a new $38 million financing and plans to expand to 22 metro areas in 2013. As I wrote, I think that as Aereo's awareness increases this year, it's going to challenge pay-TV because it effectively eliminates the broadcast TV reception element of pay-TV's value proposition. By "hollowing-out" this important feature, Aereo will cause many pay-TV subscribers to question whether they really need/value the myriad cable networks they don't really watch. Given pay-TV's escalating cost and Aereo as an alternative, many people could begin to scale back.


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LiveU, which pioneered live video streaming over cellular connections, is on a huge roll, now serving 500+ broadcasters in 70 countries worldwide, according to COO and co-founder Avi Cohen, whom I spoke to yesterday. Given that growth, it's no surprise that the company raised another $27 million earlier this week, a noteworthy round given current market conditions.

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I'm pleased to present the 155th edition of the VideoNuze-TDG podcast with my weekly partner Colin Dixon, senior analyst at The Diffusion Group, who joins from London. First up this week, we discuss AOL's video success and the larger concept of video syndication. Earlier this week, AOL revealed that its video revenues jumped from $10 million 2 years ago to $100 million in 2012, largely due to syndication. Colin and I dig into why syndication is so compelling and what's ahead.

Next up, Colin shares insights he gained from a presentation at the OTTTv World Summit in London by Marina Kalkanis, Head of the BBC's Programmes OnDemand Core Services team, which is responsible for the media and metadata services supporting BBC online. Marina's team oversaw BBC's online simulcast and on demand streaming of the London Olympics.

Colin was impressed by the scale of the BBC's Olympics operation and how video was consumed online and on mobile devices. One key takeaway - BBC found online/mobile complimenting linear TV, similar to NBC's experience in the U.S.

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Univision has launched its ambitious UVideos online and via mobile apps for iOS and Android devices. Announcing UVideos, Univision cited Nielsen research that 60% of  Spanish-speaking Hispanic consumers like to share video clips with friends online, with 60% of them saying they want more Spanish-language digital video.

When visiting UVideos for the first time, Univision has helpfully posted the splash screen below with navigation cues called out to orient new users.

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Colin Dixon, senior partner at The Diffusion Group and I are back for the 152nd edition of the VideoNuze-TDG podcast. This week Colin and I first share our reactions to the launch of Boxee TV earlier this week. Colin is struck by Boxee TV's unlimited video recording feature, the first that either of us have seen. Colin also points out potential challenges with upstream bandwidth that could be a challenge for Boxee TV recording programs at HD quality. Overall though, Colin likes Boxee TV's direction and believes it's a better strategy for the company than the original Boxee Box.

As I wrote earlier this week, I see Boxee TV in the context of innovation happening with broadcast TV and DVR. Along with Simple.TV and Aereo, consumers are gaining more control of their broadcast TV experience. In addition, they're all overlapping to an extent with Hulu and Hulu Plus which already offer unprecedented access to broadcast TV programs. It's still too early to tell which of these approaches will succeed, but Colin and I share our predictions.

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Odd as it may seem on the surface, the intersection of broadcast TV and the DVR has become a hotbed of innovation. Yesterday brought the latest player in this space, Boxee TV, which followed news earlier this week that Simple.TV has begun shipping, which itself followed the launch earlier this year of Aereo.

While each has its own unique approach, they all fundamentally provide viewers more flexibility to record and play back broadcast TV programs by leveraging over-the-top, broadband delivery, while seeking to undercut the price of a monthly subscription to pay-TV. They are all segmenting the consumer market, pursuing a cohort of "cord-cutters" and "cord-nevers" open to alternatives to pricey multichannel TV bundles.

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Colin Dixon, senior partner at The Diffusion Group and I are back for the 150th (whoohoo!) edition of the weekly VideoNuze-TDG podcast. This week Colin and I talk about how on-demand viewing - through both DVRs and online - is changing the landscape for TV networks and advertisers.

First up, Colin shares some eye-opening numbers from the start of this year's TV season, as reported by the NY Times. Certain shows like NBC's "Revolution" and "The New Normal" plus CBS's "Hawaii Five-o" gained a whopping 40% more viewers due to DVR-based viewing in the 3 days following their premieres. This new viewing dynamic, particularly among the coveted 18-49 cohort, underscores the new reality of on-demand's importance in assessing a show's potential. Premiere night alone is no longer determinative (if it ever was!).

On-demand viewing is also a conundrum for advertisers and agencies when creating media plans. And that's why this week's announcement by Nielsen of its Cross-Platform Campaign Ratings solution is a big step forward in monetizing audiences across screens. Online has emerged alongside DVRs as a legitimate viewing alternative, and advertisers need to harness its potential. Colin and I discuss how Cross-Platform helps create a "common currency" measurement with TV, which will appeal to TV ad buyers, while helping content providers better value their online ad inventory. It's a complicated topic, but as Colin notes, the shift from "broadcaster-centric to consumer-centric" is causing huge ripple effects in the ecosystem.

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I TiVo'd the "60 Minutes" interview with Mark Owen (his pen name), one of the Navy SEALs who shot Osama Bin Laden and has now written the new book, "No Easy Day" about the operation. As luck would have it, because of the U.S. Open women's finals, my TiVo stopped recording a third of the way into the interview. Frustrating, but not the first time this has happened. No problem, I figured I'd just go online to 60 Minutes' web site and the interview would be right there, front and center. Right? Wrong.

Oddly, if you visit the 60 Minutes site, you will see a large picture and the headline "SEAL's first-hand account of bin Laden killing" (in rotation with 2 other unrelated stories receiving equal prominence), but not the video itself embedded. In fact, if you scan the home page to try to find the link to watch the full episode, a thumbnail for it can't be found until about a quarter of the way down a lengthy page, well below the fold and after a group of related behind-the-scenes videos from 60 Minutes Overtime.

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I'm pleased to be joined once again by Colin Dixon, senior partner at The Diffusion Group, for the 145th edition of the VideoNuze-TDG Report podcast. In this week's podcast Colin and I talk about what resonates most for us about Aereo, based on my interview with its founder and CEO Chet Kanojia, earlier this week (Part 1 here and Part 2 here).

Foremost for both of us is Aereo's simplicity and ease of access. Aereo aligns with the expectations of digital natives, people who expect self-service offerings that have low entry barriers and commitment levels. Aereo capitalizes on key vulnerabilities of today's pay-TV services - not just that they are expensive, but that they are complicated, with various tiers, channels, fees, clunky set-top boxes and special offers tied to extended contracts, all of which are confusing and burdensome to many people, especially digital natives.

Embedded in Aereo's simplicity/convenience value proposition is its focus. Aereo is not trying to be all things to all people; rather it is starting by offering flexible broadcast TV reception, mainly for use on iPads, for a low daily cost. We were both struck by Chet's comparison of Aereo to the early days of cable TV. While their architectures are fundamentally different, their core initial offer of improving reception and access to broadcast TV programming, is similar.  In this respect, you gotta love the durability of broadcast TV as a value driver.

However, cable's early model of cleaning up broadcast signal delivery eventually gave way to retransmission consent fees. For both Colin and me, this is the area that remains murkiest for Aereo. While it won the first round in court, it faces a long journey of legal challenges ahead. In particular, Colin is not convinced of Chet's belief that should Aereo adversely impact retrans fees, cross ownership of broadcast assets would enable media conglomerates to remain whole by shifting around fees to cable assets.

Finally, we are both impressed with how Aereo is capitalizing on so many of today's key technology and consumer behavioral trends. These include the declining cost of IP video delivery, storage costs and processing power, along with the rise of cloud computing, mobile devices (namely the iPad) and the shift to on-demand viewing. Chet views Aereo as a "platform" that unites all of these into a compelling consumer offering. We agree. In particular, its low, "success-based" capex model means Aereo should be able to rollout quickly and inexpensively. I draw a contrast with Google's costly fiber buildout in Kansas City.

Chet downplays Aereo's disruptive impact, but Colin and I agree it's potentially significant. Time will tell.

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In the second part of my interview with Aereo's founder and CEO Chet Kanojia, we begin by discussing how the company relates to the pay-TV industry, and whether it is incenting cord-cutting and cord-nevering, or is simply benefiting from this activity. In fact, Chet believes Aereo is a retardant for cord-nevering, because it helps people inclined in this direction to get accustomed to paying for video. Down the road he envisions how that helps them to become pay-TV subscribers.

Chet sees cable as an inspiration for Aereo, in the sense that it too started off providing a simple convenience service, namely improved broadcast reception. Cable's model of layering on subsequent services is one that Aereo could follow as well.

Of course much has been made about how Aereo potentially relieves pay-TV operators from the burden of expensive retransmission consent fees. No surprise, it was hard to pin Chet down on this issue, but generally he believes that given the cross ownership between broadcast TV networks, cable TV networks and cable TV operators, any pressure on one revenue stream would simply get resolved by adjusting the others.

Other topics we talk about include Hulu, Netflix, net neutrality, bandwidth caps, Barry Diller's role, the composition of Aereo's team, expansion plans and its success-based capex model.

Watch Part 2 of the interview below. Part 1 is here.

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There's likely no online video startup that has created quite the stir this year that Aereo has. But what's been lost in the coverage of its legal wrangling with broadcasters and high-profile backing from Barry Diller is a clear understanding of Aereo's business strategy: Who are its target customers? What is its real value proposition? How will it compete in a crowded video landscape? What new business opportunities is it trying to create for the TV ecosystem? And how are things going so far?

These are among the questions that Aereo founder and CEO Chet Kanojia addresses in a 47-minute interview I did with him at the company's offices earlier this week. Chet looks at today's TV ecosystem and sees a world filled with inconvenience, irrational pricing/bundling and misalignments with emerging consumer expectations/behaviors. Like all can-do entrepreneurs, Chet's reaction is to see opportunity; in Aereo's case, that means delivering a "simple, rationally-priced, convenient" service to people who have become accustomed to these types of benefits in other areas of their lives.

As Chet explains, some of Aereo's prospects are "cord-nevers" - younger, Internet-centric users who place a huge value on convenience and are cost sensitive. And others are cord-cutters, who are ready to move on from taking myriad pay-TV channels they don't watch or value. Importantly, Chet doesn't see Aereo incenting these emerging behaviors, but rather benefiting from them.

In part 1 of our wide-ranging interview below, we also discuss Aereo's marketing approach and why sampling is so critical, the breakthrough antenna technology that enables Aereo's service and of course the dynamics with the broadcasters who are so determined to shut Aereo down.

Tomorrow I'll post Part 2.

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Variety is reporting on an internal Hulu memo indicating that the imminent buyout of Hulu's private equity partner may spark a series of changes, including the possible departure of CEO Jason Kilar and modifications to its content licensing arrangements with its broadcast network TV owners. Kilar has done an excellent job with Hulu, creating a top-notch user experience that is monetized through both ads, and more recently through subscriptions at Hulu Plus. Kilar has more than defied the skeptics who dismissively labeled Hulu "Clown Co." prior to its launch.

Nonetheless, there can be no disputing the fact that Hulu's essential asset from the outset has been exclusive next-day access to programs from Fox and NBC (now Comcast) and more recently, Disney/ABC. Broadcast TV is still by far the most popular programming around, and even though Hulu has added dozens of content partners, including a high-profile deal with Viacom, the reality is that for many Hulu users, it's a destination to catch up on their favorite broadcast programs. 

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NBC was justifiably crowing late yesterday that the London Olympics was the most-watched TV event in U.S. history with 219.4 million viewers, but a more profound long-term takeaway from this year's games is that digital distribution of most of the competitions did not seem to hurt tape-delayed on-air viewing at all.

That was not a foregone conclusion, and given the billions in broadcast rights fees it paid, NBC made a sizable bet that with most competitions live-streamed and available on-demand, audiences would still tune in during ad-rich, prime-time hours, despite already knowing (or having seen) the results. The impact of digital distribution could have gone wrong, driving lower prime-time ratings, creating disgruntled advertisers and embarrassing NBC Sports executives. The fact that it didn't buttresses the argument that for sports in particular, digital delivery is a compliment, not a substitute, for on-air.

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I'm pleased to be joined once again by Colin Dixon, senior partner at The Diffusion Group, for the 142nd edition of the VideoNuze-TDG Report podcast. In this week's podcast Colin and I first discuss NBC's Olympics video streaming. Despite some high profile criticism, we agree that NBC has actually done a pretty good job and has laid a foundation for live streaming to be an expected part of all Olympics coverage in the future.

Next we review Q2 '12 results from some of the largest pay-TV operators. Video subscriber losses continue, although Q2 is historically a soft quarter. Colin notes that recent TDG research shows the pay-TV value proposition is increasingly challenged and he believes that means higher churn is ahead, with bigger opportunities for OTT options.

Speaking of those options, Aereo announced new low-cost plans and both Colin and I agree that they're a clever way to reduce entry barriers and increase viewing flexibility. It's still early, but we like Aereo's odds of success.

Last up, we note the early demise of the Nexus Q media streaming device, a product that both us called a dud a couple of weeks ago.  

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I'm pleased to be joined once again by Colin Dixon, senior partner at The Diffusion Group, for the 139th edition of the VideoNuze-TDG Report podcast.

Breaking with tradition, we're posting this week's podcast a day early to share our thoughts on Aereo's big legal victory - the decision by U.S. District Judge Judith Nathan to deny the broadcast networks' request for a preliminary injunction to block Aereo's service. As Colin and I agree, though the broadcasters have promised to pursue an appeal, for now it's a very significant milestone for Aereo, as it validates the company's assertion that the Cablevision precedent should hold.  

Our discussion focuses on the ruling's implications. Certainly it opens up a whole new option for pay-TV operators to avoid paying hundreds of millions in retransmission consent fees by either partnering with Aereo or developing comparable technology (patent issues notwithstanding) to deliver broadcast programs. It also opens up opportunities for OTT providers to potentially beef up their services in partnership with Aereo. While Colin sees Aereo as offering some benefits for the broadcasters, I view the ruling as key setback to their strategy to develop a secondary revenue stream.

The ruling also comes in the context of two other significant developments - the decision by DirecTV to drop Viacom's networks and the news that Netflix's usage surpassed 1 billion hours in June. Both underscore the impact that evolving consumer behaviors are having on the relationship between pay-TV and online video delivery. The Aereo decision scrambles that dynamic even further. No question, we are living in very interesting times.

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