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Splashcast Blog - Social Marketing Musings
 
Covering TV Everywhere, Hulu, and Netflix Business Models
Updated: 36 min 52 sec ago
Fri, 2009/11/20 - 1:25pm
Verizon Communications CEO Ivan Seidenberg said today: "Hulu is a six month wonder and that technology will ultimately bypass the current fascination with the online video service." I think his prediction may be correct, but for the wrong reason. It won't be because of technology, it would be a result of Hulu losing its exclusivity over online distribution for NBC, Fox, ABC. These programmers will have too many other, more economically compelling online distribution options shortly, with TV Everywhere, etc. Story: http://www.broadcastingcable.com/article/390026-Verizon_Chief_Hulu_Will_Be_Over_In_Two_Years.php
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Wed, 2009/11/18 - 12:21pm
Comcast-owned ThePlatform is arguably the top Online Video Platform (OVP) provider, and almost certainly is within the TV industry. They unseated encumbent Brightcove over the last year by launching Hulu.com, CBS.com, TV.com, and a slew of other broadcast and cable TV networks. They announced even more TV programmer customers today (most of whom are owned by Comcast) as well as Rogers, Canada's largest cable operator. ThePlatform also powers online video for Comcast's largest competitors: Time Warner Cable, Cox, and CableVision.
Today, thePlatform made a major announcement that brings TV Everywhere a HUGE step closer to reality.
ThePlatform is launching a cable Authentication & Authorization component to its white-label video publishing product that will enable programmer web sites (HBO.com, Showtime.com, NBC.com, etc) to publish their premium TV shows on their sites, requiring the user to authenticate himself as a cable subscriber with access to that channel (ie, you can only watch HBO shows online if you pay for HBO through your cable provider). Enforcing this authentication ensures everyone in the media supply chain gets credit for that view, and money is transferred accordingly. To that end: an integration with Nielsen to directly track views would be a killer strategic move by thePlatform!
This solution also has the following compelling side benefits for the MSO's and TV Programmers:
- Keeping cable subscribers happy and hooked (cable companies fear that free online TV services like Hulu may result in cable subscribers canceling their pay TV services).
- Upselling subscriptions: if I'm a Comcast subscriber but don't pay for the HBO cable package, I may be compelled to sign up now if it means I can watch all HBO shows whenever I want, online (or on my HD TV via Boxee or the like).
- Upselling content: if I am not an HBO subscriber but want to watch just a single HBO show, now there is a mechanism to buy shows a la cart. This is the model that Disney currently loves.
Here's a nice diagram of how this new component works:
ThePlatform is initially providing this technology only to TV Programmers for their sites (broadcast networks and cable channels). That's a great first step, though I believe the killer app will be making this capability available to any web site, not just NBC.com or HBO.com, etc. I wrote about this just yesterday.
Regarding the rest of thePlatform's competition in the OVP space... DigitalSmiths, despite its strong TV Everywhere positioning campaign last month, hasn't released any technology yet that addresses the initiative's largest challenges: authentication and authoriziation. Meanwhile, Ooyala and Brightcove appear to be sitting on the TV Everywhere sidelines.
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Wed, 2009/11/18 - 9:38am
Marketers care first and foremost about reaching their target customer. Content (media) has traditionally been a proxy for reaching those consumers. But that's all changing now, and it will adversely impact old media (such as broadcast and cable TV), which does not have strong audience targetting capabilities.
There is a philosophical shift on Madison Avenue, where major agency holding company media services operations say they have shifted from a mentality of "buying media," to one of "buying audiences," and that technology and automation have enabled them to accelerate that shift. "Data is the fuel that drives today's audience targeting engines. Data-driven audience planning and targeting tools ultimately enable brands and their agencies to reach and target verified audiences of prospects that look like their best customers," David Helmreich, vice president-interactive markets at verified audience data provider TARGUSinfo writes in the report. Rubicon described this shift as "advertising 3.0," and said it will really start to accelerate as publishers begin selling their "audiences - not just their sites, zones, brand and content."
Story:
http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=117611
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Tue, 2009/11/17 - 10:24pm
Good news for both Comcast and Murdoch this week: consumers are increasing their spending on monthly subscriptions to entertainment and news content. "Overall monthly per-capita entertainment-content subscription spending rose to $115, which is an increase of nearly 7 percent since last year. “Despite concerns that the recession would cause consumers to reduce spending on entertainment subscription services, most forms of subscription entertainment are doing just fine,” said Russ Crupnick, entertainment industry analyst for NPD. “Consumers are clearly looking to the value offered by entertainment subscriptions and like what they get for their money; plus, new technologies and products have helped bolster data plans and other newer kinds of subscription-based services.” Press release: http://www.npd.com/press/releases/press_091116a.html
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Tue, 2009/11/17 - 11:51am
One step at a time, I understand. But I believe it's critical that TV Everywhere becomes an "open" premium video distribution platform available for any web publisher, on any web site.
Consumers will demand the freedom to watch Entourage in their preferred environment, be it Hulu.com, Facebook, Boxee, etc... not just on Fancast.com or HBO.com. That is the promise of TV Everywhere. Universal authentication will make this a technical possibility. It is ultimately the right thing to do and will benefit the entire media ecosystem, starting with the paying customer.
Clearly Comcast, Time Warner, and the other MSO's need to weigh the benefit of providing their subscribers a good experience (in the form of choice) versus the economic benefit of locking their users to their own sites (or programmer sites, such as HBO.com, CBS.com, Showtime.com, etc).
The MSO's have a reputation for opting for the economic benefit over the user experience benefit, which has really hurt their brand image.
Creating a "win" for the user should be the top priority for Comcast and Time Warner. Remember, TV Everywhere was born out of a defensive move to stem cable cord cutting.
I understand that we are just in the first inning of TV Everywhere, and these are the necessary first steps. However, I would like to hear Comcast and Time Warner talk about the longer-term vision for where this is all going.
Here is Comcast's Amy Banse articulating their near-term TV Everywhere (OnDemand On Line) rollout:
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Mon, 2009/11/16 - 2:12pm
The Wall Street Journal ran a story today discussing the potential regulatory challenges to a Comcast acquisition of NBC Universal. What these stories seem to miss is that this a DEFENSIVE move by Comcast, not an aggressive move against its rivals. Comcast is NOT buying NBC to seek an "unfair" advantage in its cable markets (though that's not to say they wouldn't hesitate to pursue such advantages if they were available). The real motivation behind this deal (I believe) is survival. Comcast understands that the price point for distributing TV into homes is going to fall dramatically in the coming years. Comcast's 3 distribution products, Voice - TV - Internet, are collapsing into just one, single product: Internet. This poses a huge threat to Comcast's top line. As such, Comcast is hedging through diversification into content, moving up the media value chain. Comcast will be looking to replace lost revenue in distribution with revenue from content (advertising, subscriptions, etc). At it's core, it's that simple. Therefore, I believe Comcast will be willing to live with any reasonable regulatory restrictions the government slaps on this deal.
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Fri, 2009/11/13 - 9:20am
The Old Way: consumers pay for distribution of content (cable, newspapers, ISP's, etc).
The New Way: consumers pay for the content, regardless of how it's distributed (TV Everywhere).
TV Everywhere's core value proposition for consumers is that they can view their TV when they want (on demand) and where they want (TV, PC, mobile, tablet, etc). It's a no brainer proposition; who wouldn't want that?! Newspapers need to do the same thing for news content. This is where Murdoch is both right and wrong. He's right in that consumers SHOULD pay for the value of quality content, but he's wrong in that they should pay twice for the same content: once for physical newspapers and again for online access. Consumers WILL pay for the value of quality content, as long as they only pay for the "piece of content" once, and are able to view it how they want, when they want. Assuming that the consumption of the content can be tracked across all devices, that ads can be dynamically placed across all devices, and that the content programmer gets "credit" for the view.... everybody wins. End of debate.
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Thu, 2009/11/12 - 6:14pm
The highlight of today's NewTeeVee Live conference was clearly Quincy Smith, the "Hans Solo of TV Everywhere". The guy is brilliant. He is one of the few media executives who totally understands the whole picture: traditional TV, the web, the consumer, the media supply chain, distributors, and advertisers. And he can articulate a powerful and compelling vision for where TV is going (very much UNLIKE his music counterparts). Comcast's Amy Banse came in 2nd place as far as speakers, in my mind. She is such a great spokesperson for Comcast: precise and calculated. Represents the Comcast brand perfectly.
But where was Hulu? Perhaps true to the current anti-momentum Hulu is struggling with right now, Jason Kilar (Hulu's CEO) was MIA from this year's conference, dubbed "The Year of TV Everywhere".
http://newteevee.com/2009/11/12/newteevee-live-quincy-smiths-official-exit-interview/
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Tue, 2009/11/03 - 9:29pm
Rumors are flying high today about an iTune's $30 / month "TV Subscription" service. It would give users "all you can eat" downloads of current (and some past?) episodes of TV shows - playable your computer, iPhone, iPod, or even up on your TV. No need to pay Comcast anymore, right? Sounds great for users, but it does force the TV networks and cable channels into an uncomfortable and unwanted political mess. The content providers remain quite reliant on fees paid to them by the cable / satellite companies; it represents a large percentage of their overall revenue, in fact. Further, iTunes downloads would potentially erode their primary revenue stream: broadcast advertising. Why would NBC, Fox, CBS, etc risk any of that? While Apple would love to disrupt the TV industry as thoroughly as it did the music industry, by disintermediating the MSO's (cable co's), I just don't think it will be that easy. In the case of TV, unlike music, the content providers hold the cards and they have little interest in pissing off their existing distribution partners. That's ESPECIALLY true if the MSO's go on an expected content binge (a la Comcast gobbling up NBC). Story: http://mediamemo.allthingsd.com/20091102/apples-itunes-pitch-tv-for-30-a-month/#content-main
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Tue, 2009/11/03 - 9:09am
Let's all say a collective "Duh!" If Comcast buys NBC, Comcast won't be allowed to remove NBC channels from TimeWarner or DirecTV offerings. "Duh!" If Comcast buys NBC, Comcast won't be allowed to delay airings of NBC shows on rival MSO offerings. "Duh!" If Comcast buys NBC, Comcast won't be allowed to limit online viewing of NBC content to only Comcast subscribers. Again, a no-brainer "duh!".
Comcast's interest in NBC is not to gain unfair distribution advantage. It is to move up the media value chain, closer to content, diversify its assets, and acquire a "safer" revenue stream as cable TV increasingly becomes a "dumb pipe". Comcast won't screw up those objectives by pursuing clearly short-sighted and probably illegal content hording (which also severely limits the value of the content!).
Here's the WSJ blog post:
http://voices.washingtonpost.com/posttech/2009/11/a_comcast_buy_of_nbc_raises_sl.html
Sent via BlackBerry
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Sun, 2009/11/01 - 9:06pm
More Wall Street jabs at Hulu, and specifically at CEO Jason Kilar. Check out this scathing excerpt from the Media Post story below: ------------ "The problem is, the 27 year-old geniuses (running Hulu) have run amuck," Needham analyst Laura Martin says. "They are clever, dynamic and understand social networks, and they go, 'oh, let's get on the Web, let's innovate. It gives us lots of flexibility on what to do with the content,' and then they steal from the guys spending the $3 billion dollars and they don't do anything about it." Martin says it's not difficult to take a $3 billion product and give it away for free, then pat yourself on the back for attacking millions of viewers. --------------- Ouch! But not necessarily untrue. Story: http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=116559 Sent via BlackBerry
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