-
Here's the Real Story Behind Pay-TV's Record Q2 '11 Subscriber Losses and the Role of Cord-Cutting
Today I'm pleased to present a special 2-part VideoNuze Report podcast with guest Bruce Leichtman, who is president and principal analyst of Leichtman Research Group. Bruce has been doing primary consumer research on the pay-TV industry for 15 years and is one of the foremost industry authorities.
In part 1 of the podcast, Bruce gives a detailed analysis of the industry's record Q2 '11 loss of over 300K subscribers among its 14 largest providers. Bruce explains the industry's historical context, drills down on which companies had the biggest year-over-year change and what accounted for this. Importantly, Bruce focuses on larger macro and micro-economic factors that are influencing the industry's results in a bigger way than new technologies and innovation which often take center stage.
Then in part 2 we turn our attention to the role of cord-cutting on the industry and the influence of Netflix specifically. First, Bruce clarifies the difference between non-video subscribers and "cord-cutters," a crucial distinction which he believes has recently been overlooked by many. Bruce shares his research on how many actual cord-cutters there are, which types of pay-TV subscribers are most vulnerable to cord-cutting and what role Netflix is playing. We wrap up by discussing what's ahead and how concerned industry CEOs should be about the threat of cord-cutting.
Categories: Cable TV Operators, Podcasts, Satellite, Telcos
Topics: Leichtman Research Group
-
Fox's New 8-Day Window Obsoletes Hulu's Simple User Experience
If one of the things you liked most about Hulu has been its simple, straightforward user experience - where TV programs could be quickly found and viewed - then Fox's new 8-day authenticated pay-TV window is going to feel like a big hassle. And if ABC and NBC, Hulu's other broadcast content partners and owners, adopt a similar approach to Fox, then it's really going to feel like going back to the dark ages of user experience.
Fox's authentication window means that during the first 8 days after an episode's air date only current subscribers of certain pay-TV services (DISH Network for now) or Hulu Plus can watch that episode. That in turn means that when searching for a new episode on Hulu, the resulting experience will be quite different than it has been.
Categories: Aggregators, Broadcasters, Cable TV Operators, Satellite, Telcos
-
Google Gets Its Nose Into Pay-TV Operators' Tent With Motorola Deal
A byproduct of today's blockbuster deal by Google to acquire Motorola Mobility for $12.5 billion is that Google is getting its nose into pay-TV operators' tent via Motorola's huge set-top box business. Set-tops are part of Motorola's Home segment, which in Q2 generated over $900 million in revenue, a little less than a third of Motorola's total.
Google would dearly love to have a bigger presence in the digital living room, but its initial efforts with Google TV have not borne much fruit, despite the fact that Google took an industry-friendly approach by trying to augment
pay-TV services rather than disrupt them. Now however, with Motorola's deep industry relationships, Google will gain much better insight into pay-TV operators' thinking that could help drive partnership opportunities. Importantly, this could translate into improved product integration between Google's software and Motorola's hardware platforms that could give Google its best shot yet at getting into the living room (throw Google potentially acquiring Hulu and the living room fight gets even more interesting).
Categories: Cable TV Operators, Deals & Financings, Technology
-
SNL Kagan Forecasting 10% of U.S. Homes Will Cut the Cord by 2015
Researcher SNL Kagan is forecasting that 10% U.S. homes (12.1 million) will cut the cord on their pay-TV subscriptions by the end of 2015, substituting in over-the-top alternatives. At the end of 2011, 4% or 4.5 million homes will have done so. Still, Kagan sees pay-TV subscriptions actually increasing, though not at a rate fast enough to maintain current penetration levels (see yearly forecast after the break).
Kagan isn't providing any additional profile information on these cord-cutters, but as I've said before, I think the most vulnerable buckets are the "cord-nevers" (i.e. college grads and others who simply don't sign up for pay-TV service in the first place) and entertainment-only viewers who don't care about live sports that are only available on cable TV channels.
Categories: Cable TV Operators
Topics: SNL Kagan
-
Cisco Divestiture Could Be Final Blow for Traditional Set-top Boxes
It's no secret that sales of traditional set-top boxes (STB) have been under huge pressure for a while now as IP delivery becomes more integral to pay-TV operators' technical architecture. But yesterday's news that Cisco, which is one of the biggest providers in the world of traditional STBs, is looking to divest its big STB plant in Juarez, Mexico, could be a final blow for the beleaguered devices, accelerating pay-TV operators' IP plans.
Cisco has been getting hammered from all sides recently and the divestiture would no doubt have much-needed short-term financial benefits (coupled with an imminent layoff). The larger context behind the move is more significant: pay-TV operators want to gain more flexibility in delivering services to subscribers while reducing their capex. As more pay-TV subscribers turn to their iPads, Rokus, smartphones and gaming consoles for their video entertainment, pay-TV operators need to run harder than ever to innovate.
Categories: Cable TV Operators, Technology
Topics: Cisco
-
Cable Flexes Its Muscles (Again) With ESPN's Wimbledon Win
Score another sports programming victory for cable, as ESPN announced today that it has acquired all of the U.S. TV rights to Wimbledon tennis in a
12-year deal beginning in 2012. ESPN's win was NBC's loss, as the broadcast network's 43-year association with the tournament comes to an end.
For ESPN, and for cable TV networks in general, it is another step in a steady progression of using their economic supremacy over broadcasters to obtain television rights to marquee sporting events. While ESPN is the undisputed leader, numerous other cable networks like TNT, USA, Versus, Golf and of course the regional sports networks (RSNs) such as Comcast SportsNet and Fox Sports Net have staked their claim to early round or full coverage of high-profile sports events.
Categories: Broadcasters, Cable Networks, Cable TV Operators
-
Time Warner Cable Promoting WatchESPN App for Wimbledon Viewing
Time Warner Cable is sending the below email to subscribers promoting the WatchESPN app for anytime/anywhere Wimbledon viewing. The email is the first consumer-facing example I've seen of a cable operator promoting a specific cable programmer's TV Everywhere app.
The email's copy hits the right messages nicely, emphasizing free access for existing Digital TV customers, anytime/anywhere/anyplace access on mobile devices and tablets, and easy app download instructions. The email is a winner in terms of getting the message out that TWC understands its subscribers' new viewing expectations and that it delivering a service that meets them.
Categories: Cable Networks, Cable TV Operators, Sports
Topics: ESPN, Time Warner Cable, Wimbledon
-
VideoNuze Report Podcast #100 - Cable Show Review - June 17, 2011
Categories: Cable Networks, Cable TV Operators, Podcasts
Topics: Cable Show, Netflix
-
Comcast's CEO Roberts Downloads 23 Episodes of 30 Rock in 1.39 Minutes at 1Gbps
At the Cable Show in Chicago today, Comcast's CEO Brian Roberts showcased the company's ability to deliver 1 gigabit per second throughput by downloading a full season of 23 episodes of 30 Rock in just 1 minute, 39 seconds. Putting the 1 Gbps throughput in context, Roberts noted that back in 1996, delivering 1-2 megabits per second was state of the art, and that as recently as 2007, 100 megabits per second was the limit.
Increasing speed has been a core value proposition of cable's broadband ISP efforts for years. It has taken on even greater importance recently as consumption of high-quality video has soared. An emerging theme in the pay-TV industry is delivering not just on-demand streams, but full lineups of live TV over IP as well. All of this will drive ever-higher consumer needs for bandwidth.
Categories: Broadband ISPs, Cable TV Operators
Topics: Comcast
-
Comcast's CEO Roberts to Showcase Xcalibur Platform at Cable Show
As expected, Comcast announced this morning that its CEO Brian Roberts will demo the company's new "Xcalibur" video delivery platform on Thursday
morning at the Cable Show in Chicago. Xcalibur has been in trial in Augusta, GA and is meant to deliver a new, more web-like experience to the TV, complimenting what Comcast has been doing online with Xfinity TV and in mobile with its iOS and Android apps. A new interactive guide will be unveiled as well as "MyTV" which is a central location for storing recordings, favorites and recommendations.
In addition, apps for traffic, weather and social sharing through Facebook will be available. Comcast announced a handful of technology partners - using Intel chips with higher graphics performance for the UI in new set-top boxes, Pace as the first hybrid set-top box manufacturer and wholly-owned subsidiary thePlatform for content management (thePlatform just unveiled yesterday a joint solution with Alcatel-Lucent to deliver similar IP-based video services).
Categories: Cable TV Operators
Topics: Comcast
-
New Research Shows Netflix Is A Catalyst for Cord-Cutting and Cord-Shaving
The Diffusion Group released interesting research yesterday which supports a view that I've had for a while: heavy Netflix streaming usage correlates with a propensity to cut back on pay-TV services. Although Netflix has strenuously
tried to position itself as a low-priced compliment to pay-TV services, the reality is that for some pay-TV subscribers who have begun shifting their viewing hours to Netflix streaming, the two are more substitutes than compliments. As I've argued, these are primarily people who are entertainment-oriented, don't care about live sports, are comfortable with on-demand, not live-viewing, are budget-constrained, or some combination of all of these.
The headline of the research is that the number of Netflix streamers considering downgrading their pay-TV service doubled year-over-year from 16% to 32%. But to me the key nugget is that among those who said they are likely to downgrade or eliminate their pay-TV service, 61% of moderate to heavy Netflix streamers cite online video usage as the top reason for doing so (with two-thirds of these citing Netflix specifically), while just 24% point to economic issues as their top reason. Conversely, for all Netflix streamers, almost half point to economic issues as their main reason (e.g. "cost of service" and "need to save money"), with just 34% pointing to online video usage as their top reason.
Categories: Aggregators, Cable TV Operators
Topics: Netflix, The Diffusion Group
-
Comcast and Skype Partner for TV-Based HD Video Calling
On the eve of the Cable Show, Comcast and Skype are announcing a partnership that will enable TV-based HD video calling. Comcast subscribers using the new service will be able to make Skype video and audio calls while at the same time watching TV. On-screen caller ID will pop-up when a Skype call is received. A Comcast spokesman told me last week that customer trials are set to begin soon (word actually began leaking out last week).
For Skype, the partnership is another route into the living room as it seeks to become a ubiquitous communications platform. Early last year Skype
announced it was working with Samsung and Panasonic to embed the Skype app in certain connected TV models, and it also offers a variety of HD web cams for sale on its site. For Comcast, Skype is an enhancement to its Xfinity TV service and mobile app that creates some interesting new integrated communications and social media experiences.
Categories: Cable TV Operators, Communications
-
thePlatform and Alcatel-Lucent Deal Continues Pay-TV's Push to IP Delivery
Online video platform provider thePlatform and IPTV services/hardware giant Alcatel-Lucent are introducing an exclusive joint solution this morning to
further accelerate pay-TV operators' transition to an all IP-based delivery model targeting multiple devices. The goal is to provide a soup-to-nuts system for pay-TV operators that combines the same control and security of traditional single purpose QAM video networks with the flexibility and cost-effectiveness that IP delivery offers. thePlatform's CEO Ian Blaine and AlcaLu's SVP, Global IP Video Solutions Derrick Frost, brought me up to speed last week.
The companies' multiscreen video platform solution has 3 components:
Categories: Cable TV Operators, Technology
Topics: Alcatel-Lucent, thePlatform
-
@ELEVATE: 75% of Cable TV Programming to be on TV Everywhere in 2 Years
At the ELEVATE conference earlier this week I moderated a panel with executives from 3 of the leading proponents of TV Everywhere, during which they estimated about 75% of cable TV programming could be available on connected and mobile devices within 2 years. That amount would be a huge increase from what's currently available and would also represent a massive shift by the pay-TV ecosystem to delivering content to IP devices. It would also represent a huge game change in the overall TV advertising ecosystem depending on what ad policies are implemented (full ad load, partial load, etc.).
The panelists included David Preschlack, EVP, Affiliate Sales and Marketing, Disney & ESPN Networks Group, Jeremy Legg, SVP Business Development & Multi-Platform Distribution, Turner Broadcasting and Matt Strauss, SVP & GM, Comcast Interactive Media.
With the rise of over-the-top competitors (e.g. Netflix, Hulu, iTunes, etc.), TV Everywhere has emerged as the pay-TV industry's number one priority. No doubt at next week's Cable Show in Chicago it will be the most pervasive topic of discussion. Yet significant issues remain for TV Everywhere's rollout. Chief among them are lack of adequate audience measurement systems, limited rights and caution among cable networks. We discussed each on the panel.
Categories: Cable Networks, Cable TV Operators
Topics: Comcast, ELEVATE, ESPN, Turner
-
Clearleap Looks to Power More Cable iPad Apps
Large cable operators like Comcast, Time Warner Cable and Cablevision have launched popular iPad apps over the past 6 months, and now technology provider Clearleap is looking to help get other cable operators into the iPad app game (as well as apps for other connected devices). This morning Clearleap is announcing a set of APIs for its Stream On Demand product that allow developers to quickly create an app's front-end user experience while having the back-end processes fulfilled without any custom development.
iPad and other connected device apps are a critical part of cable operators' larger TV Everywhere strategies of unlocking cable programming from the set-top box and allowing subscribers to watch programming anytime, anywhere and on any device. However, the proliferation of devices, and the need to have programming delivered securely, has created significant complexity and cost to accomplish this goal. Underscoring the challenges, even the largest operator, Comcast, only just last week announced its Xfinity TV app would support video streaming to iPhones/iPod Touches, and it has yet to release this for any Android device. For mid-size and smaller operators who don't have the same resources, iPad and other apps are out of reach.
Categories: Cable TV Operators, Devices, Technology
-
Four Comcast Announcements Show Importance of Digital Video
Last week brought four rapid-fire announcements from Comcast,underscoring how the company is ramping up its digital video delivery efforts and the PR surrounding them. The announcements were:
5/23 - Xfinity TV App version 1.5, with video streaming capability, available on iPhone and iPod Touch. Leading off the week was news that Comcast's Xfinity TV app had been updated so that iPhone and iPod Touch users can now watch streaming video on these devices (Xfinity TV streaming was made available on the iPad in February, and is not yet available on Android, though other features of the app are). Comcast said this was the number one most requested feature from users.
Categories: Cable TV Operators
Topics: Comcast
-
Why Cord-Cutting May Actually Be Good News for Cable Operators After All
Yesterday's big headlines - that Netflix now accounts for almost 30% of all downstream Internet traffic - is further evidence of the popularity of the company's streaming service, and also a preview of the significant structural changes that lie ahead in the over-the-top (OTT), broadband ISP, and pay-TV industries. Specifically, as Netflix and other OTT providers' surging traffic compels broadband ISPs to administer strict bandwidth usage caps and adopt usage based pricing ("UBP"), the stage will be set for a new era in how tens of millions of consumers decide which in-home entertainment services they subscribe to. If you thought that would be very bad news for cable operators specifically, it might be time to think again.
Cable operators and programming networks are the focal point of upcoming change. Operators in particular, because they are both the largest providers of both subscription video services and broadband Internet services, are really at center stage. Much of the hype around "cord-cutting" over the last year has implied they are on the losing end of this potential activity. Often overlooked however, is the fact that as consumption shifts to OTT sources, consumers' bandwidth needs escalate. As such, the door opens for them to institute UBP, as AT&T has recently done.
Categories: Aggregators, Broadband ISPs, Cable Networks, Cable TV Operators
Topics: Netflix
-
thePlatform Continues TV Everywhere Momentum With Cox TV Online
thePlatform continues to rack up large pay-TV operators as customers for its TV Everywhere video management platform, this morning adding Cox TV Online, the TV Everywhere initiative of 3rd-largest U.S. operator CoxCommunications. thePlatform is now powering 5 of the top operators in North America, including Comcast (its parent company), Rogers in Canada, BigPond from Telstra in Australia and others. In addition to the operator side of the equation, thePlatform has pushed aggressively into powering content providers' authenticated TV Everywhere programs.
Categories: Cable TV Operators, Technology
Topics: Cox, thePlatform
-
Comcast's TiVo Deal Breaks New Ground, Unifies VOD, OTT Navigation
Yesterday, Comcast and TiVo announced an interesting deal that allows TiVo Premiere owners who subscribe to Comcast's digital video service to also receive Xfinity TV VOD alongside over-the-top choices like Netflix, Hulu Plus, Amazon, etc. It's a little bit of an alphabet soup situation to understand,
which will make marketing it a challenge, but if the two companies are successful, it could actually be quite meaningful to consumers who choose to take advantage of the offer. I caught up with TiVo's EVP Jeff Klugman and had a slew of questions answered by Comcast to understand things better.
Under the deal, TiVo Premiere owners can have Comcast come to their home at no charge and install the box and a CableCARD, making sure everything is working properly with the video service and their broadband connection (this will start in the SF area, with other markets to follow). One of Premiere's primary benefits is that when a user search is conducted for a TV show or movie, the results include all potential sources - Comcast linear and VOD as well as OTT options. That's beneficial to users because as long as rights are granted according to studios' adherence to windows, trying to understand what's available on which service/device at any particular time is virtually impossible for any average consumer.
Categories: Cable TV Operators, Devices, Video On Demand
-
Pay-TV Industry Ekes Out Q1 Gain. Netflix Softens Its Tone. What's It All Mean?
Trying to get one's head around the true competitive dynamic between pay-TV operators and new "over-the-top" entrants is surely one of the most vexing exercises video industry executives face these days. The media's coverage only exacerbates things: when the pay-TV industry contracts for a quarter, the headlines imply cord-cutting is sweeping the nation, then when the pay-TV industry reverses and makes a small gain, the headlines suggest all is fine again in pay-TV land, and that Netflix is just a nice little complimentary service.
So it was again this week, as industry analysts released their Q1 pay-TV subscriber estimates showing that pay-TV operators as a whole eked out an increase of around 450K-500K subscribers. While that was a better showing than the past 2-3 quarters when the industry shed subscribers, it was also slightly worse than Q1 '10. Regardless, the first quarter is a seasonally-strong quarter for pay-TV, and so the gains must be tempered by what follows in subsequent quarters. The good news is that the economy is improving which can only help budget-minded households better afford expensive pay-TV services.
Categories: Aggregators, Cable TV Operators, Satellite, Telcos
Topics: Netflix
Posts for 'Cable TV Operators'
Connect with VideoNuze
Exclusive News Roundup
- Roku, X Games Strike Streaming Deal The Wrap
- YouTube Teams With CAA to Let Talent Identify - and Pull Down - AI Deepfakes of Themselves Variety
- Comcast targets early 2025 for regional sports networks on Peacock The Desk
- Here’s a Hollywood Twist: Streaming Success Runs Through Theaters NY Times
- Google DeepMind unveils a new video model to rival Sora TechCrunch
- YouTube TV Raises Monthly Charge 14 Percent, to $82.99 NY Times
