Posts for 'SVOD'

Although Disney gained a healthy 14.6 million direct-to-consumer subscribers in its fiscal fourth quarter reported this week, it also lost nearly $1.5 billion in the segment. That raised its annual DTC loss for fiscal 2022 to over $4 billion, more than twice the $1.7 billion it lost in fiscal 2021. Disney reiterated that it expects DTC losses will decrease going forward and that Disney+ specifically will achieve profitability in fiscal 2024, absent a “meaningful shift in the economic climate.”

On this week’s edition of Inside the Stream, nScreenMedia’s Colin Dixon and I examine the various cross-currents impacting Disney’s DTC business going forward. These include declining ARPU at Disney+ domestically and Disney+ Hotstar, upcoming price increases, SVOD and FAST competition, content costs and more. The stakes are high for Disney to turn the corner on DTC profitability but it isn’t clear when or how that will happen.

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In Q3 ’22 Netflix added 2.4 million subscribers globally, beating its forecast of a million additions, and more importantly, reversing the two prior quarters’ declines. As nScreenMedia’s Colin Dixon and I discuss on this week’s Inside the Stream, there’s a lot of action just ahead for Netflix as it rolls out its ad-supported tier and modifies its longstanding account sharing approach.

The latter will likely impact tens of millions of subscribers, who will have multiple variables to consider in order for family members to retain access to Netflix. We do a little back of the envelope math that illustrates  the significant revenue opportunities all of this will create for Netflix.

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This week on Inside the Stream Colin and I interview Hub Entertainment Research’s Founder and Principal Jon Giegengack about top conclusions from the firm’s latest “Decoding the Default” survey (excerpt here). Among them are that streaming services continue to gain as the default source for viewers (with Netflix by far the leader), being the default is the best protection from churn, SVOD stacking appears to have plateaued and some streaming services seem to be pretty well insulated from inflation. We discuss all of these and more.

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Amazon took the unusual step of releasing viewership data for its new Lord of the Rings series “The Rings of Power,” saying that over 25 million Prime members watched it on its first day. On this week’s podcast Colin and I discuss how to put this number into context, and also whether the series is worth the reported $58 million per episode it cost. Then we transition to reviewing new data about viewer satisfaction with ad-supported FAST services vs. ad-free SVOD services.

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This week, nScreenMedia’s Colin Dixon and I welcome Grace Lam, Roku’s Director of Partner Growth as our guest. Grace takes us inside the campaign that Roku and HBO Max launched for the new TV series “House of the Dragon.” It is the biggest SVOD campaign Roku has undertaken to date, involving multiple elements. Grace walks us through the campaign’s goals, viewer benefits, success metrics and how Roku aims to have the campaign be a template for future SVOD partnerships.

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On this week’s episode of Inside the Stream nScreenMedia’s Colin Dixon and I discuss Disney’s direct-to-consumer (D2C) performance in its fiscal third quarter, ending July 2, 2022 and the impact of upcoming price increases across all of its streaming services. Disney now has over 221 million streaming subscribers of which 152.1 million are Disney+ subscribers (up 14.4 million in the quarter).

But these Disney+ subscribers will see their monthly fee increase by 38% in December, from $7.99 to $10.99, no doubt causing higher churn. Disney hopes to offset this with its new ad-supported “Disney+ Basic” tier which will run $7.99 per month. Hulu will increase by $1 per month to $7.99 and ESPN+ will increase by $3 per month to $9.99 as previously announced. Colin and I explore all these changes and what impact they’re likely to have (and Colin has a nice recap of the changes).

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This week on Inside the Stream nScreenMedia’s Colin Dixon and I discuss Netflix’s plans to launch ad-supported service tiers and introduce paid account sharing options. Netflix provided updates on both during its Q2 ’22 earnings call earlier this week. Colin and I agree that both are important steps for the company but that there are myriad execution challenges as the moves will introduce new complexity and decision-making for subscribers.

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This week on Inside the Stream nScreenMedia’s Colin Dixon and I discuss conflicting data about Netflix’s customer satisfaction from ASCI and Whip Media. Netflix remains an essential streaming service for many people, especially for watching drama, according to Parrot Analytics. However, new data from Antenna indicates that in April almost a quarter of Americans who signed up for Netflix dropped it within a month. We try to make sense of it all.

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In this week’s Inside the Stream podcast nScreenMedia’s Colin Dixon and I discuss how SVOD services are diversifying their monetization models beyond purely subscriptions. Examples of services doing so include Disney+, Netflix, HBO Max and Curiosity Stream. We examine what’s behind these moves and the multiple benefits they deliver.

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In this week’s Inside the Stream podcast nScreenMedia’s Colin Dixon and I discuss Netflix’s Q1 results which included a loss of 200K subscribers vs. a forecast gain of 2.5 million.

Netflix provided a number of reasons for the loss, which we explore. We’re both excited about the prospects for a lower priced ad-supported option, which is long overdue. We’re less sanguine about Netflix reeling in widespread password sharing, which it has traditionally sanctioned and now reaches an estimated 100 million households.

Listen on to hear all of our observations about Netflix’s challenges and what it can do to restart growth. (29 minutes, 46 seconds)

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This week Colin and I discuss the future integration of Discovery+ and HBO Max. New details were shared this week by the company’s chief financial officer at an industry conference. Specifically, Colin sees strong upside in a discounted bundle of the streaming services and the eventual integration of their respective technology platforms the CFO described. However, he’s skeptical of an eventual plan to actually merge the services. We discuss the pros and cons.

Separate, we dig into a new test by Netflix to potentially charge subscribers an extra fee for out-of-house users.

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Welcome to this week’s edition of Inside the Stream, the podcast where nScreenMedia’s Chief Analyst Colin Dixon and I take listeners inside the world of streaming video.

This week Colin shares thoughts SVOD growth, citing a new forecast from Digital TV Research forecasting subscriptions will reach 1.75 billion globally in 2027. Then Colin shifts to data from Omdia indicating that vMVPD subscribers use 13.5 streaming services per month, almost double non-vMVPD subscribers.

We also spend some time discussing the evolution of alternative currencies developing to Nielsen for measuring ads on premium video services.

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Welcome to this week’s edition of Inside the Stream, the podcast where nScreenMedia’s Chief Analyst Colin Dixon and I take listeners inside the world of streaming video.

Disney+ added nearly 12 million subscribers in the recent holiday quarter, an encouraging sign that bundling Disney+ with Hulu and ESPN+ is a highly effective strategy. Disney+ also had strong gains in the US and Canada market, adding 6.6 million subscribers in the quarter, while Netflix by comparison added only 1.2 million. Colin and I dig into all the Disney+ numbers and discuss what might be next.

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Welcome to this week’s edition of Inside the Stream, the podcast where nScreenMedia’s Chief Analyst Colin Dixon and I take listeners inside the world of streaming video.

This week we discuss Netflix’s Q4 ’21 earnings report released yesterday and its forecast for Q1 ’22. Both came up a little light, as the SVOD category continues to mature, Covid pull-forward creates tough comparisons, there’s intensifying competition, and Netflix’s release schedule for popular content shifts.

All of that said, with over 220 million global subscribers, Colin and I still see Netflix as the SVOD category leader well into the future.

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Late last week Disney told its Hulu + Live TV subscribers that Disney+ and ESPN+ would be bundled starting Dec. 21st, and that their rate would be increasing by $5 per month. Coming off an anemic fiscal Q4 ’21 in which Disney+ added just 2.1 million subscribers, the lowest by far since launching in late 2019, the intra-company move meant the automatic addition of 4 million Hulu + Live TV subscribers to Disney+’s total in one magical wave of CEO Bob Chapek’s wand.

I received a number of emails from VideoNuze readers to the effect of “that kind of corporate trickery doesn’t feel like a positive sign for Disney+.” I don’t dispute that there’s merit to that line of thinking, but I’d discount it. The step up in Disney+ subscribers in fiscal Q1 ’22 will be so delineated that it means Wall Street won’t give Disney+ any credit for it because investors are tunnel-visioned on Disney+’s organic growth heading in 2022 (that’s kind of what happens when an SVOD service goes from a standing start to 118 million subscribers in less than two years…expectations become quite high).

I’d assert that the tunnel vision on Disney+’s growth is causing under appreciation of what may be a far more important driver of Disney’s decision to bundle Disney+: Hulu’s burgeoning opportunity in connected TV advertising.

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Welcome to this week’s edition of Inside the Stream, the podcast where nScreenMedia’s Chief Analyst Colin Dixon and I take listeners inside the world of streaming video.

Disney+ now has 118.1 million subscribers, less than 2 years since its launch. But Disney+ added just 2.1 million subscribers in the fiscal fourth quarter of 2021, a huge slowdown from the blistering pace of the past 2 years. This raises the question many investors are asking: can Disney+ reignite growth in 2022, and if so, how? Colin and I explore these questions on this week’s podcast.

Meanwhile, Hulu keeps chugging along, albeit in the shadow of Disney+. But as we also discuss, Hulu is already likely profitable (at least marginally), but looking out, it is poised to become a genuine profit engine for Disney. That’s because Hulu is one of a handful of scaled, ad-supported services and its Live TV + SVOD services is already generating nearly $85 per month in average revenue per subscriber. As CTV advertising becomes increasingly central to advertisers, Hulu is well-positioned to benefit.

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Welcome to this week’s edition of Inside the Stream, the podcast where nScreenMedia’s Chief Analyst Colin Dixon and I take listeners inside the world of streaming video.

On Comcast’s Q3 ’21 earnings call, management was vague about how Peacock is performing. In Corporate America, not highlighting numbers is typically a sign that things are not going as well as hoped and/or the numbers are not as impressive, comparably speaking, as those of competitors. A round of speculation about Peacock’s performance and what might happen next has ensued.

On this week’s podcast, Colin and I try to explain what we think is happening. The hard truth for Peacock is that it came to market very late and that it is competing against well-funded and highly aggressive competitors which are spending heavily on originals and on promotions - a commitment that Comcast/NBCUniversal have not publicly committed to match. Another issue - at least relative to Paramount+/Showtime, which gained 4.3 million subscribers in Q3 - is that Peacock doesn’t include NBC’s linear feed, and also doesn’t specialize in mature content, which has a strong draw. These two benefits (and “Star Trek”) have no doubt helped Paramount+/Showtime. Yet another issue is that popular NBC programming continues to be available in Hulu.

All of these factors, and others, are limiting Peacock’s appeal. As if that wasn’t enough, Comcast has mixed incentives related to Hulu, because it still has a 30% stake that is getting more valuable by the day, as Netflix stock hits new highs. Comcast is financially disincented from harming Hulu by pulling programming to help Peacock (all of this would have been moot if only Comcast had acquired Hulu when it had the chance back in 2018). Comcast has missed out on billions in additional revenue and value creation.

In short, Comcast/NBCU are now facing a dilemma with Peacock that can be boiled down to: Go Big or Go Home. Either commit to spending what's required to compete effectively (either at the AVOD or SVOD level), or recognize Peacock is going to keep treading water and will likely never break out. It’s a tough decision, but it reflects the penalty late entrants face, especially when squaring off against competitors like Netflix, Amazon, Disney, HBO Max, etc.

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Welcome to this week’s edition of Inside the Stream, the podcast where nScreenMedia’s Chief Analyst Colin Dixon and I take listeners inside the world of streaming video.

HBO / HBO Max lost 1.8 million subscribers in the U.S. in Q3 2021. On the surface that might seem like a bad thing, especially given how hot the streaming business is these days. But as Colin and I discuss, this week, it’s actually a good thing, as it reflects the rolloff of many millions of subscribers who were acquired via a prior distribution deal with Amazon Channels.

HBO Max has made an intentional decision to focus on a direct-to-consumer strategy, which we think is smart. Back in August, I explained the challenges SVOD services have with third-party distribution, including with Amazon, based on my personal experience subscribing to AMC+ through Amazon.

After talking to industry colleagues since, I’ve become more skeptical about the long-term value to SVOD services in these deals. So a DTV strategy, especially for a big player like HBO Max, seems like the right one. As we also discuss, it’s also a smart move given HBO Max, as part of WarnerMedia, will be merged into Discovery in 2022.

Elsewhere in the podcast we talk about the per subscriber value of the ad-supported vs. ad-free business model, and why I think that in the long-term, the former is far greater in a connected TV dominated world with “full funnel” marketing capabilities. We also dig into HBO Max’s decision to have content parity starting in January between its ad-supported and ad-free tiers. Lots to digest.

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Welcome to this week’s edition of Inside the Stream, the podcast where nScreenMedia’s Chief Analyst Colin Dixon and I take listeners inside the world of streaming video.

Rather than focus on just one story this week as we usually do, today we do segments on 5 different stories that caught our attention. First we pick up on last week’s podcast about the dustup between YouTube TV and NBCUniversal. The companies avoided going over the cliff together and managed to extend their relationship. But it is a harbinger of more fights between networks and virtual (and traditional) pay-TV operators as the size of the pie continues to shrink due to cord-cutting.

Then Colin and I have a spirited debate about Google’s Fiber TV, which is being retired, and the broader question of whether Google Fiber’s 1 gigabit per second broadband service is a worthwhile product offering (Colin thinks it is and I think it isn’t, and I haven’t since it launched way back in February, 2010, see “Google’s Fiber-to-the-Home Experiment Could Cost $750 Million or More.” Also see "Google Fiber is Out of Synch With Realities of Typical Consumer Technology Adoption" from July, 2012 and "No Surprise, Google Fiber is Falling Short of Expectations" from August, 2016.)

From there we discuss the steep drop in L7 TV ratings that has continued in the first week of this Fall season. But even at these depressed levels, I assert that the most popular broadcast TV shows like “NCIS” still draw audiences that may likely be bigger than the first 7 days following the drop of a popular show on a big SVOD service like Netflix. Related, we discuss new Kantar data on SVOD churn in Q2. For more insight, have a look at my post from November, 2019, “Will Spinning Video Subscriptions Become a Thing?”

Finally, there’s a game of musical chairs happening in our industry and this week’s move by Kelly Campbell from president of Hulu to president of Peacock is just the latest example. We discuss why these executives’ shuffling matters to all of us as consumers.

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Welcome to this week’s edition of Inside the Stream, the podcast where nScreenMedia’s Chief Analyst Colin Dixon and I take listeners inside the world of streaming video.

On this week’s podcast we dig into my post from earlier this week about my experience starting a 7-day free trial to the SVOD service AMC+ using Amazon Channels. I did this in order to watch the movie “A Few Good Men” with extended family last weekend.

While the sign-up process was very easy, the issue is that neither AMC+ nor Amazon has done anything to try converting me from trial to paid subscriber by explaining the service’s content value. In fact, when I tried cancelling the first time, they did the opposite, offering me a new discount if I stayed on for another two months.

Colin and I explore the bind that small to mid-size SVOD services find themselves in with Amazon Channels and other big platforms. On the one hand, the platforms are huge potential sources of trial subscribers. On the other hand, if the SVOD service has virtually no insight about their trial subscribers, can’t connect with them to directly promote content and the platform itself does nothing to convert subscribers from trial, is there really any long-term value being created for the SVOD service, or is it just churning through viewers?

These are tricky questions without clear answers. But they have huge implications for SVOD services and the platforms going forward. Learn more now!

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