Topic: Video
Apple Vowed to Revolutionize Television. An Inside Look at Why It Hasn’t – Bloomberg (Feb 16, 2017)
I think the shorter version of this story is that Apple hasn’t been able to revolutionize TV because the traditional TV industry isn’t willing to let it, at least not yet. More than in any other industry, the traditional players still hold pretty much all the cards when it comes to future services from a licensing and content perspective, and until that starts to break down, no outside player is going to make a meaningful difference. That means we’ll continue to have a mosaic of partial replacements for pay TV, mimicking some of the features and content but not others, and leaving users to pull it all together in custom bundles. Apple is part of that aggregation layer today, but doesn’t really play anywhere else – the Apple TV box and the TV app are partial solutions for the fragmentation problem, but are incomplete – you still can’t watch a full slate of traditional pay TV on your Apple TV, and the TV app excludes Netflix among other content providers. Both the box and the app are still useful, but they’re not revolutionary, and the intransigence of the old guard is the single biggest reason. In music, Apple was able to get the labels on board because they were panicking about Napster and file sharing, but the TV industry isn’t yet at that crisis point. In the next couple of years they’ll get there, but in the meantime Apple either has to continue to tinker around the edges or do something that looks less like a pay TV replacement and more like something different, a la Netflix.
via Bloomberg
No ‘Daily Show’ on Hulu: Viacom-Hulu Licensing Pact Expires – Variety (Feb 15, 2017)
Further evidence here that if tech is to disrupt TV, it’s often going to do it without the support of the traditional TV industry, which is in some cases starting to pull back its content to its own platforms while leaving others like Hulu out in the cold. Viacom’s new CEO said on its recent earnings call that the company would be pulling back from SVOD services, and this is the first sign that he meant what he said. This is also the single biggest reason for SVOD providers to invest in a big way in original content which can’t be yanked away due to skittishness on the part of content providers. Hulu is a unique animal in this space, with several of its its owners among its biggest content providers, but it’s still vulnerable to this kind of thing, and the other big streamers even more so.
via Variety
Amazon just shared new numbers that give a clue about how many Prime members it has – Business Insider (Feb 15, 2017)
I had missed this earlier in the week, but we got some juicy new numbers from Amazon as part of its 10-K filing, and they’re quite illuminating when it comes to Prime. This article specifically talks about Prime subscriber numbers, but the same underlying figures from the 10-K can also be used to derive some other interesting conclusions about Prime revenues and so on. I put together an in-depth blog post just now on all this, which you might want to check out too (my subscriber numbers are a little different from Morgan Stanley’s).
via Business Insider
Caavo’s $400 streaming box unites Amazon, Apple, and everything else into one TV interface – The Verge (Feb 14, 2017)
This feels like an absurdly large, heavy, and expensive (albeit attractive) box for simply switching inputs on your TV. That’s a shame because the device has a great pedigree, but this is just inserting yet another box between all your various boxes on the TV. This Variety piece actually does a better job of explaining the user interface than the Verge one, but it still doesn’t sound like nearly enough to justify the price and size here. The problem here is we’re still trying to solve this problem in the same way – by pulling together multiple inputs rather than creating a single input that does everything you want natively. That’s still a long-term hope rather than a proximate reality at this point, but several boxes are getting closer and I think we’ll see more progress this year.
via The Verge
Facebook is launching an app for Apple TV and Amazon Fire TV – Recode (Feb 14, 2017)
More news out of Recode’s Code Media conference today (after Apple’s last night). This one was actually reported by the Wall Street Journal a little while ago and I commented on it then. I’m still a little skeptical about this, but there weren’t many more details in the announcement, and so we’ll have to see what the app actually looks like and how it works – I do think there’s potential for Facebook to use some of its clever technology to present people with a better feed of relevant video, but I think that’s some way off still. Also worth noting: Facebook will have apps for Amazon and Apple TV boxes as well as Samsung smart TVs, but not for Android TV. And of course Twitter already has a TV app, mostly useful for its live video, though there as here the big questions remains whether the companies can actually sell enough ads around this video to make the effort worthwhile.
via Recode
Apple Debuts Planet of the Apps Trailer – Recode (Feb 14, 2017)
Apple debuted the trailers for its Planet of the Apps and Carpool Karaoke shows at the Code Media conference last night. These are two of Apple’s first bits of original video content, both of which will debut as part of Apple Music. Carpool Karaoke still features James Corden on some episodes, but not all, which will detract at least somewhat from the original format, which is compelling in large part because of him. Planet of the Apps is a Shark Tank-style reality / competition show focused on apps. This clearly plays to Apple’s strengths, and gives potential competitors a big draw in the form of featured placement on the App Store. This isn’t my kind of thing – I’ve never been a big fan of reality shows – but Shark Tank is very popular, and Apple’s show mirrors its format pretty closely, so it should do well among the same people that like that show. In addition to music exclusives, these bits of video content are another unique feature of Apple Music, which should help set it apart versus the competition. But to my mind, it’s more interesting to see this as an ongoing push by Apple into original content, which for now may live in Apple Music but certainly has the potential to become the foundation of an Apple subscription video service in future, which could be a much bigger deal.
via Recode (Planet of the Apps trailer here)
YouTube Orders First Original Kids’ Programming for Red Subscription Service – Variety (Feb 13, 2017)
YouTube has some original content for adults already, almost all of it tied to YouTube creators in one way or another, but it’s now extending that investment into kids’ programming to go with its YouTube Kids app. Again, several of the shows feature YouTube personalities, so it’s leveraging its access to content as well as giving creators yet another reason to stick with it rather than switching focus to, say, Facebook. The YouTube Kids app has been a bit of a mixed bag so far – at a time when several big traditional kids’ programmers eschew advertising, it’s shown ads (unless the viewer has a YouTube Red subscription), for example. But this is an interesting next step.
via Variety
Jeff Bezos wants Amazon to be the next HBO, Showtime – New York Post (Feb 13, 2017)
This feels like a totally logical next step for Amazon, which already has lots of both episodic and feature length content, and has been selling other companies’ premium channels for a while now. It’s presumably learning a lot from selling Showtime and the like, and has seen an opportunity to add yet another layer of subscription revenue to the base Prime membership. One big question, of course, is how it will divvy up its original and acquired content between the existing Prime service and this premium tier – any exclusivity around the paid channel dilutes the value of the base subscription, which Amazon wouldn’t want to do. It’s possible that this will be an offering primarily aimed at non-Prime subscribers, or part of its video-only version.
via New York Post
What’s different about Snapchat’s next new original series – Mashable (Feb 10, 2017)
Yet more ammo for the “Snapchat is TV” crowd, though that feels more and more literal all the time, since Snapchat’s content is more and more actual TV content from actual TV companies, as with A&E in this case. What’s unique here is that the show is both unscripted and not based on an existing show – i.e. it’s original content for Snapchat, though importantly not original content by Snapchat a la Netflix/Amazon/HBO. Snapchat did spend $13.3 million more in 2016 than 2015 on content creation, but in reality that’s about collaborating with existing providers on content rather than creating its own. For now, Snapchat remains a great way for existing TV brands to reconnect with the large portion of its target audience which has abandoned traditional TV.
via Mashable
YouTube Introduces Live Mobile Video for Top Creators – Mashable (Feb 7, 2017)
Live video is already a big deal at YouTube, but streaming live video from a mobile device has been surprisingly late in YouTube’s rollout of the feature. Now, it’s finally making it available to channel owners with over 10,000 subscribers, after testing it for months with a smaller group of creators. This feels like a smart way to start, even if it’s somewhat ironic that the video platform known for user generated content will close the feature off to regular users, at least for the time being. If the quality of the early live video on YouTube is good, it could do much better than on Facebook, where most of the live video I’ve seen has been pretty poor, and feels more like spam in my feed than a useful addition. YouTube seems to be sensibly prioritizing quality over quantity here. The monetization angle is interesting – mid-roll ads are always interruptive, and YouTube appears to be focusing on paid comments, a much more unique model and one which doesn’t detract from the video itself. I’m very curious to see how much that feature gets used, though Google will never tell us how much money it makes this way.
via Mashable
The Latest YouTube Stats on Audience Demographics – Google (Feb 7, 2017)
There are some interesting numbers here – not all of them are new, but the collection of them all into one place is, and some are pretty striking. Some of the key points: time spent on YouTube is rising rapidly – doubling from 2015 to 2016 among all adults, but tripling among users 55+; YouTube reaches 95% of online adults over 35 in a month; YouTube users skew slightly female and are more likely to have a college degree than the general population. To my mind, the takeaways are that YouTube has massive scale, probably broader than any other video platform or service in the US, and that it’s reaching that stage of its maturity where its growth is stronger among newer groups of users, notably older users, which mirrors what’s happened with Facebook in recent years. This is a massive scale, mature platform – the challenge is monetizing it effectively and generating a profit, something Google has seemed increasingly focused on in the last couple of years.
via Google
Periscope CEO Kayvon Beykpour is now running all of Twitter’s live video products- Recode (Feb 6, 2017)
Live video is a big focus for Twitter, arguably to the exclusion of almost any other major innovation in the core product, and so it makes sense that it has a leader who reports directly to Jack Dorsey. But Twitter has always had two approaches to live video: Periscope, the original play, is a standalone app focused on user-generated content, and then there are all Twitter’s live video partnerships with existing content owners like the NFL and Bloomberg. It makes sense to start bringing these products together under a single leadership to make sure they work together effectively, but I think it’s also quite possible that we start to see Periscope integrated more into the core app and lose some of its identity as a separate product. Hopefully this will also free up Keith Coleman, who runs product at Twitter, to focus on all the other things that need fixing.
via Recode
Facebook Tunes Into Television’s Market – WSJ (Jan 31, 2017)
Facebook’s quest to find new places to put ads continues. It’s far from clear what this Apple TV app will actually look like yet – whether a simple feed of all the videos from the user’s News Feed, or something more. Making the jump to TV from mobile is really tough – Facebook on a smartphone neatly fills all those moments during the day between things: waiting for a bus, killing time during a commercial, and so on. I’m not convinced it can make the transition from the thing you do while watching TV to watching TV itself. It’s another one of those cases where the reasons why Facebook would do it are obvious, but the reasons for people to actually use it are far less so.
via WSJ
Digital media fell in love with Snapchat, and now Snapchat loves TV – Mashable (Jan 28, 2017)
This is a great bit of reporting on how Snapchat’s Discover feature has evolved since it first launched, and how Snap’s relationship with publishers and content providers has evolved with it. Discover continues to be the most obvious place for Snap to deliver growth in ad revenue, and having quality content is a big part of achieving that goal. Snap is also putting more emphasis on competing with TV for millennial viewers, an audience which is both overrepresented on Snapchat and underrepresented in traditional TV viewership. There are lots of good comments in this piece from publishers who have worked with Snap and seen good results, some of them driving decent profits from their channels and others merely experimenting with a new format. Well worth reading the whole thing.
via Mashable
Facebook wants you to watch longer videos, so it’s going to show you longer videos – Recode (Jan 26, 2017)
“Facebook wants to sell mid-roll video ads, so it’s going to show you more longer videos” would be an even more direct reading of this situation. Facebook recently began introducing mid-roll video ads, but of course those don’t do any good if the videos people watch are too short to hit the point where an ad would be shown. And Facebook has arguably trained its audience and content providers to prefer short videos, because those tend to grab attention better and lend themselves better to the soundless auto-play scenario that dominates video viewing on Facebook now. In order, then, to feed users more video ads, Facebook needs first to feed users longer videos, and it’s tweaked its algorithms to show more longer videos than before. On the surface, this is about fairness – percentage completion rates are always going to be lower for longer videos for short ones, and so some weighting is required to measure performance fairly. But this is really a fairly transparent way to provide yet more slots for Facebook ads, as with this week’s testing of banner ads in Messenger. As with that announcement, Facebook is here going to begin bumping up against the natural limits of how many ads its users will tolerate, and will have to be very careful.
via Recode (official blog post here)
DCN report shows publisher revenue from Google, Facebook, Snapchat – Business Insider (Jan 24, 2017)
This article (and the report it’s based on) frustratingly focuses on average numbers across a range of very different publishers, rather than providing something more detailed, which limits the usefulness of the data, but there’s some interesting stuff in here regardless. For one, this reinforces the sense that publishers are between a rock and a hard place when it comes to supporting the major new content platforms – on the one hand, they feel they can’t afford to be absent, and on the other systems like Facebook Instant Articles and Google’s AMP don’t seem to allow them to monetize as they do on their own sites. One surprising finding is how strongly Snapchat shows here relative to its overall share of ad revenue. The picture is muddied by the fact that the report covers both video and news content, and so YouTube makes a very strong showing overall too. The key takeaway for me is that these companies continue to tread a difficult and dangerous path as they work with these platforms, ceding a lot of control to them and potentially seeing less revenue as a result.
Update: the actual report is now available here in full.
via Business Insider
‘Manchester by the Sea’ Nomination Makes Oscar History for Amazon – Variety (Jan 24, 2017)
Amazon has become the first streaming service to have a movie it owns nominated for best picture at the Oscars. This follows years of Netflix and Amazon content receiving nominations for TV awards, and Netflix has previously earned nominations in other categories. The catch here is that Amazon released Manchester by the Sea in theaters, so it feels much more like a traditional release than most of Netflix’s movies (The Little Prince, a Netflix-owned movie that didn’t debut in theaters, was not nominated in the best animated feature category despite being well received). So although there’s some symbolism here, it’s mitigated a little by the fact that the movie still received a traditional theatrical distribution (and did well there). It is ever clearer, however, that Amazon and Netflix (and potentially others) will continue to grow as a force in movie acquisition – the Sundance Film Festival is underway at the moment and we’re likely to see several more big buys there as the streaming companies beef up their libraries with exclusive content.
via Variety
Verizon Lays Off Go90 Employees, Tasks Vessel Team With App Rebuild – Variety (Jan 23, 2017)
Verizon’s Go90 has never seemed like the right answer to the question of what a mobile carrier should do to make money from video (the right answer might either be launching a fully fledged video service a la DirecTV Now, or simply enabling all other video services a la BingeOn). These layoffs seem like validation of that sentiment, as it looks like Verizon is doing a bit of a reset on its Go90 efforts, putting former Vessel people in charge instead of the 155-strong team it’s had in San Jose for some time now, most of whom came from the Intel OnCue acquisition. Go90 has always been an odd mishmash of stuff, mostly freely available elsewhere with a few freemium elements focused on millennial-oriented content, but has never felt like a serious video play, and I still don’t expect it to turn into any kind of meaningful business for Verizon unless there’s a big pivot to a new strategy for the service.
via Verizon Lays Off Go90 Employees, Tasks Vessel Team With App Rebuild | Variety
AT&T’s Streaming Service DirecTV Now Peaking At 35,000 Simultaneous Users – StreamingMediaBlog.com (Jan 20, 2017)
Update: AT&T has now released official numbers, with over 200k paying users. So it appears Dan’s estimates were a little short. Though given that AT&T offered a free Apple TV for those who committed to three months of service, it’s possible some of those users aren’t active and will churn shortly.
Dan’s very good at what he does, so I have no reason to doubt that he’s in the right ballpark here, and these numbers are interesting in their own right. What’s even more interesting is how poorly this service has performed, and how unapologetic AT&T has been about it. I met with Enrique Rodriguez, the CTO for AT&T’s Entertainment Group, at CES, and although he acknowledged there were issues, he downplayed them. I have had better luck than some with the service once the first few days were over, but many people are still clearly having lots of issues, which is just baffling for something AT&T talked up so much ahead of time. Moreover, the platform AT&T is using for DirecTV Now is the same one it plans to use for Sunday Ticket online, its TV Everywhere services, and more going forward. I’d hope things start to change quickly here, because the way things are going right now this doesn’t look pretty.
via AT&T’s Streaming Service DirecTV Now Peaking At 35,000 Simultaneous Users – StreamingMediaBlog.com
Netflix reports $2.35B in Q4 revenue, up from $1.67B in Q4 2015 – Techmeme (Jan 18, 2017)
Normally I’d link to a company’s own report on its earnings, but since Netflix’s earnings material is all in non-web file formats like PDFs and Excel spreadsheets, I’m linking instead to the Techmeme cluster of articles on the earnings report. Broadly speaking, this is a great set of results for Netflix – subscriber growth both domestically and internationally was higher than it forecast, with domestic growth bouncing back nicely now after a couple of tough quarters in which price increases were a drag on net adds. The international business is nearing profitability, though Netflix will invest to keep it just in the red in 2017, and margins expanded nicely domestically thanks to those price increases. With short-term growth concerns somewhat alleviated, the main focus returns to Netflix’s content spending and whether it’s sustainable. It had a non-GAAP free cash flow loss of $639m in Q4 and $1.7bn in 2016 as a whole, both massively up from the year before as it invests in original content, which has to be paid for upfront. Over time, that much higher investment will flow through into the P&L too, and continued strong growth is critical for staying ahead of those costs.
via Techmeme
You may also be interested in the Netflix Q4 2016 deck in the Jackdaw Research Quarterly Decks Service.