Posts for 'Cable Networks'

(Note: I will NOT disclose anything about last night's series finale, so fans, you're safe to read on without spoilers.)

Last night was the series finale of the hit AMC show "Breaking Bad." I count myself among the millions of super-fans who fell in love with the series from the start and have been loyal ever since. Importantly though, my viewing experience with Breaking Bad distinguished itself from every other TV show I've ever watched: it was the first one where I watched every single episode on-demand and without ads.

In fact, my experiences with Breaking Bad perfectly illustrate so many of the video industry themes I write about on VideoNuze each day that I thought it would be worth sharing some of them and what I learned.

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Adobe is announcing today that Turner Broadcasting is its latest customer of Adobe Primetime, the company's multi-screen TV Everywhere and monetization solution. Turner will be using Primetime to power TNT and TBS apps and web sites, along with the Primetime player and dynamic ad insertion, PayTV Pass authentication and Primetime DRM.

Jeremy Helfand, VP Adobe Video Solutions, told me that until now Turner had been using a combination of home-grown and point product solutions, which are being replaced with the Primetime suite. Turner has been the earliest and staunchest supporter of TV Everywhere among cable TV networks, going back 4+ years to the high-profile joint news conference with Time Warner CEO Jeff Bewkes and Comcast CEO Brian Roberts, announcing the initiative.

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I'm pleased to present the 194th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. First up this week we discuss CBS CEO Leslie Moonves' remarks on CNBC essentially declaring victory in the company's retrans dispute with Time Warner Cable because it had preserved its ability to license its programs to Netflix and Amazon. Listeners will recall that 3 weeks ago on the podcast we talked about how OTT licensing was at the heart of the dispute and the consequences for TV Everywhere.

Next we transition to questioning whether there's any real benefit for TV networks and pay-TV operators to stream linear channels to connected TVs. Colin observes that recent data from the BBC indicating very low levels of linear streaming on connected TVs appears to question the value of the Disney-Apple TV and Time Warner Cable-Xbox 360 deals. We speculate that these are mainly meant for 2nd or 3rd TVs that don't have pay-TV set-top boxes.

Last, we chat briefly about the massive 3-part series that the NY Times ran just before Labor Day on ESPN's dominant role in college football - a long, but fascinating read. As I wrote, it's well worth the time for anyone interested in the influence of big time TV money not only on college sports but also on the broader American higher education system.

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The NY Times is currently running a huge, 3-part, page 1 expose on ESPN's transformative role in college football. It's a must-read for anyone interested in a behind-the-scenes, in-depth account of how the sports network's massive financial strength has completely changed college football, from game day and time scheduling to conference re-alignments to how star players are created. Even more broadly, the article speaks to the pervasive role college football now plays in American higher education.

A key focus of the first two parts, here and here, is the willingness of particular schools (e.g. Texas Christian, Boise State, Louisville) to play weekday night games in order to provide ESPN live football throughout the week. Various representatives of the schools are quoted recognizing the coverage they received from ESPN as being critical to raising their schools' visibility and profiles. For ESPN, importantly, these mid-week games and assorted promotional activities showcased for still other schools how valuable being a flexible partner for ESPN can be.

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Disputes between broadcasters and pay-TV operators over so-called "retransmission consent" fee payments are a dime a dozen. Broadcasters, seeking their slice of the monthly fees pay-TV operators pay cable TV networks, have bargained hard for this new revenue stream. In this sense, the current CBS-Time Warner Cable retrans standoff is business as usual. What is new, however, is that digital rights - and more specifically the huge licensing fees that OTT's richest players, Netflix and Amazon, are now paying - have taken a central role in this particular drama.

As the WSJ reported last Friday, the real obstacle between CBS and TWC isn't what TWC will pay to retransmit the CBS signal, but rather what digital rights will be included, and at what incremental cost. Five years ago, these rights were a virtual throwaway, but now it's a totally different situation. Here's what changed:

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I'm pleased to present the 188th edition of the VideoNuze weekly podcast with my weekly partner Colin Dixon of nScreenMedia. This week rumors were once again flying about Apple and Google looking to enter the pay-TV industry, which Colin and I separately wrote about here and here.

In our discussion, Colin notes that any potential move would be expensive, given the need to carry many networks in a typical bundle. Colin also believes that Apple's rumored plan to compensate networks for ads skipped in a premium service it may offer has some merit based on his back-of-the-envelope analysis. But Colin is skeptical the networks will be interested in shifting their model away from advertising.

I see it the other way around; given high DVR penetration, networks could be intrigued by the idea of moving more of their economics to fees. The problem is I just don't see how the economics would work for Apple or consumers.

Regrettably, all of this is based on rumors so we readily admit we don't have solid facts on which to base our arguments. And that's why I consider Apple and Google's pay-TV aspirations to be the industry's longest-running soap opera.

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Netflix's original series "House of Cards" received 9 Emmy nominations this morning including in 3 of the marquee categories best drama, best actor (Kevin Spacey) and best actress (Robin Wright). The nominations were a first for online original programming and therefore are a bona fide milestone for the rapidly growing online video medium. In addition, Netflix picked up 3 Emmy nominations for "Arrested Development."

While Netflix bet big to put HoC in a league with cable stalwarts - and other best drama nominees "Game of Thrones," "Breaking Bad," "Homeland" and "Mad Men" plus the lone broadcast series "Downton Abbey" - an intriguing question to ask is whether the HoC nominations signal the beginning of an Emmy trend for online original programs or whether HoC is more of an outlier? In other words, can online get on the same type of award-winning growth curve for its originals as cable networks have over the last 20 years, helping drive pay-TV subscriber acquisition and retention?

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It's time for the latest episode of the industry's best and longest-running soap opera, "Google, Apple and the Mission to Disrupt Pay-TV." New reports this week (here and here) suggest that the two tech giants are once again angling to get a piece of the pay-TV industry, which, despite already being under attack from all sides, appears to be holding its own.

As in the past, the current episode is based only on "people familiar" with the discussions Google and Apple executives are each having with pay-TV industry players. Google and Apple executives as usual are offering "no comment." The new episode features twists to keep all of us engaged. Apple is reportedly contemplating a "premium" version of its service that will allow users to skip ads, with Apple compensating TV networks for lost ad revenue (not to spoil the drama, but it's awfully hard to see how the math would add up on such a plan or why the networks themselves would go for it). And Google has reportedly even demo'd its product (shocking!), though no details on what it is or how it is different were released.

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Investment firm Needham & Company has released its latest Future of TV report, with lead analyst Laura Martin concluding that the biggest current risk to the TV industry's economics is unbundling of subscription TV channels. Martin asserts that if consumers had the option to choose their channels on an a la carte basis, rather than the multi-channel bundles that pay-TV operators currently offer, approximately 50% of today's TV revenue would be eliminated with fewer than 20 TV channels surviving.

The draconian forecast adds a financial dimension to the ongoing debate around whether the TV industry will need to radically re-think its business approach if - and it's still a big "if" - cord-cutting gains momentum. To date cord-cutting (and "cord-nevering," where younger viewers simply don't subscribe to pay-TV as in the past) have been relatively muted, with estimates for 2012 in the 500K range. However, several key industry trends such as the escalating cost of pay-TV, changes in consumer behaviors, proliferation of connected and mobile viewing devices, the surge in OTT SVOD adoption (e.g. Netflix) and DVR-based ad-skipping all suggest that the industry's traditional bundled model could be tested over the next few years.

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At last month's Online Video Ad Summit, I did a great one-on-one interview with Lori Conkling, who's the EVP, Strategy and Business Development for Media Innovation and Cross Company Initiatives at NBCU (yes, Lori concedes that's a mouthful!). Lori joined the relatively new NBCU group several months ago from A&E Networks, where she oversaw multi-platform distribution strategy for the company's 10 networks.

In the interview, we touch on a broad range of topics including: fragmentation in audiences, devices and advertising, the criteria NBCU uses in determining which new technologies/opportunities to pursue (e.g. financial, lessons to be learned, etc.), NBCU's interest in original online-only programming, the status of TV Everywhere, mobile video usage patterns, and lots more. For anyone looking to get a peek into how big media companies are thinking about online video, the interview is a must-watch.

The video is below and runs 39 minutes and 29 seconds.

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CNN and BuzzFeed are partnering to create a new YouTube channel called "CNN BuzzFeed" to break original news online. The channel will feature current and archived CNN video and like all BuzzFeed content, is targeted to a younger, social media savvy audience.

CNN BuzzFeed will capitalize on two of the most important attributes of today's online video landscape: short-form and syndication. Last week, data from ad manager FreeWheel showed that "Digital Pure-Play" content providers grew their video views by 47% year-over-year (with 84% of their views coming via syndication to 3rd-party sites), while views from long-form "Linear + Digital" providers (e.g. broadcast and cable networks) decreased by 8%.

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I'm pleased to share that Lori Conkling, NBCUniversal's EVP of Strategy and Business Development for Media Innovation and Cross Company Initiatives, will be a featured speaker at the June 4th Online Video Ad Summit in NYC. Lori joined NBCU recently to drive strategy and monetization of the company's cross-platform content. In her role, Lori is also a key executive in advanced advertising, content windowing and mobile. Lori previously ran distribution at A&E Networks; at NBCU she reports into Lauren Zalaznick.

At the Video Ad Summit, I'll be interviewing Lori about the choices and challenges involved in architecting a successful cross-media strategy. Today, media companies have unprecedented opportunities to engage with their audiences, but determining which ones have the best ROI and should be pursued is harder than ever. In the interview, expect insights about changing consumer behaviors, the shift to on-demand viewing, second-screen apps that work, effective monetization, TV Everywhere, mobile/connected devices and lots more.

Early bird discounted registration for the Video Ad Summit is available until May 17th. You can save $100 by registering early, and as an added bonus, all early bird registrants will be eligible to win a Samsung 40-inch Smart TV, presented by VideoHub. We'll do the drawing just before lunch. Startups and students are eligible for even deeper discounts, contact me to learn more.

I look forward to seeing you on June 4th!

Netflix reported solid Q1 results yesterday, gaining 2 million streaming subscribers in the U.S. and another 1 million internationally. Netflix now has 27.9 paying subscribers in the U.S. and 6.33 paying subscribers internationally. With growth re-started since the 2011 Qwikster debacle, a persistent question is how big can Netflix become in the U.S.?

Traditionally many have thought the answer is in the 30 million subscriber range, which is where the biggest premium channel, HBO, has pretty much leveled out. This line of thinking assumes that Netflix is essentially another premium channel and consumers will treat it as such.

But Netflix's CEO Reed Hastings always answers the size question by asserting that Netflix can grow to become 2-3 times HBO's size, implying 60-90 million subscribers ultimately. He points to differentiators like Netflix having more content, being less expensive and available on more devices, having greater personalization, etc.

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I'm pleased to present the 173rd edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. This week we focus on the rising cost of content to pay-TV operators and the rising quality of content found online.

In a post yesterday, Colin validates pay-TV operators' complaints about programming costs, noting, for example, that at Comcast they rose from 34% of video revenue in '08 to 40% in '11 (at Time Warner Cable they were 41% and at DirecTV they were 45%). As we discuss, these escalating costs are eating into operators' profit margins as subscriber rate increases haven't kept pace. As VideoNuze readers know, sports is a major culprit in all of this, though entertainment networks have raised their own rates as well.

Against this backdrop, the quality of content available online is improving markedly. For example in just the past couple of weeks, we've seen Netflix announce another new series, with the producers of The Matrix films and Babylon5, Amazon Studios announce new shows "Betas," "Zombieland" and "Sarah Solves It" and Crackle a second season of "Chosen."  Further, anime network Crunchyroll disclosed it's now up to 200K paying subscribers, TheBlaze (Glenn Beck's online video network) is raising $40M. Even the BBC, one of the most traditional TV networks, announced it will be premiering shows on its iPlayer.

In short, the quality of programming online is getting better all the time, while the cost of content to pay-TV operators is escalating, in turn putting pressure on subscriber rates. All of this means viewership patterns are bound to change and with the broader video industry.

Reminder: sign up for "Sizing Up Apple TV" a free video webinar, next Tuesday, April 2nd featuring Brightcove's Jeremy Allaire and me.
    
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I had a classic TV Everywhere moment tonight I thought I'd quickly share. I got back to my hotel room in NYC after dinner, flipped on the TV to watch the Celtics try to break the Heat's winning streak and discovered ESPN and many other channels weren't working.

But instead of calling the front desk, waiting for a technician, keeping my fingers crossed, etc. (guessing my fellow travelers know this experience too well), I fired up WatchESPN, entered my Comcast credentials and was watching online within minutes. For the most part, video quality was very strong. The key was being able to watch via the hotel's WiFi network because the stream would have drained my 2GB Verizon data cap.

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I'm pleased to present the 170th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. First up today, Colin does a little trash talking of Time Warner CEO Jeff Bewkes. At a Deutsche Bank conference earlier this week, Bewkes said “We don’t think the multichannel bundle is becoming less of a good deal, we think it’s getting to be a better deal and we think it’s getting to be a better deal in the opinion of consumers,” Colin thinks this statement is complete baloney and cites specific research refuting Bewkes' assertions (more detail here).

We then shift gears to talk about online and mobile video advertising. It was a busy week on that front (more of what VideoNuze wrote is here). One that really caught my eye and I wrote about was from Extreme Reach. The company announced an innovative cross-media reporting suite that maps actual TV and online video ad impressions along with conversions. To my knowledge it's the first time such reporting has been possible, enabling buyers to have unprecedented insight into campaign ROI.

Listen in to learn more!

Click here to listen to the podcast (19 minutes, 47 seconds)

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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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Yesterday, Cablevision announced that it has filed suit against Viacom, seeking, among other things, to void a carriage deal it struck just 2 months ago. Cablevision is alleging that Viacom illegally coerced it into carrying 14 of its low-rated cable networks in order to get access to the 8 popular ones Cablevision really wanted.

The most obvious first question to ponder is why would Cablevision agree to a deal in December, only to sue to nullify it in February? Surely the presiding judge will ask something similar. If Cablevision was so perturbed by Viacom's negotiating position, why not bite the bullet and sue then? Another interesting question is that given bundling has been upheld by the courts in the past, what's different this time around?

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I'm pleased to present the 167th edition of the VideoNuze podcast with my weekly partner Colin Dixon of nScreenMedia. Today Colin and I assess the prospects for Intel Media's forthcoming over-the-top / pay-TV alternative service, which Erik Huggers described at this week's D: Dive Into Media conference.

Colin and I have very different perspectives on this. I believe that the ground rules of how major TV programmers negotiate their distribution deals (i.e. bundling disparate channels together) essentially eliminates the opportunity for pay-TV operators (or aspiring operators like Intel) to actually innovate with subscription packages. Further, by not addressing consumers' main problem with pay-TV, which is its high cost, Intel is going to have a hard time even getting 98% of consumers' attention in the first place.

Conversely, Colin believes that Erik wouldn't have been on stage at D unless he already had confidence he could get the kind of programming flexibility required to deliver on what he described. With that flexibility, Colin has faith that Intel can offer finer-grained packages, in turn delivering higher value to prospective consumers. However, absent more details, he's reluctant to be too optimistic.

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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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