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Friday, December 26, 2014

We've Got A Security Problem Here

2014 may best be known as the year of the hacker.  Most prominent has been the hacking of Sony, causing personal emails to be shared, a movie to be denied, and threats to be held on management.  And most recently, Sony's Playstation network and Microsoft's XBox network have both been hacked as well, resulting in an overloading of those systems.  Gamers are furious and we can all fear that 2015 will consist of even more cyber security problems. 

The simple truth is that our internet security is at risk for all of us.  As long as we are connected to the web, we are subject to potential hacking of our private data.  And there are so many different ways that hackers try to get us, from bogus emails to tapping our devices when we use an open WIFI connection.  Secure is simply not secure enough.  And from individuals to huge corporations like Sony, we have huge security issues.

For some, the idea of hacking is just a game, a challenge to see if you can break the code.  But for others, the purpose of hacking may be more sinister.  Locks and passwords may not be enough; if there is a will, there seems to always be a way to break the code.  Isn't that what the movie, The Imitation Game, is all about.  Whether for good or evil purposes, many love the idea of a good challenge.  And we are constantly facing threats to our cyber data. 

2014 may represent a pivotal mark, but it wasn't the first.  Last year, it was Edward Snowden that shared classified government information.  We also had the hacking of financial data from The Home Depot and Target. And next year, I am quite certain that more corporations will face similar hacking issues.  We should all be worried; unfortunately, as long as their is secrecy and privacy, there will be others trying to expose it.  For good or evil purposes, it will be a constant in our lives. 

Tuesday, December 23, 2014

Another Year Ends, Another Network Blackout

What would an end of year be if a cable operator and a cable network weren't in the midst of a license fee renewal.  It seems that it is a constant occurrence with always the same outcome, a network or two gets dropped for a period of time and then it is reinstated at a later date. This year the battle is between Dish and Fox regarding just two of its channels, Fox News Channel and Fox Business Network.  As of this moment, carriage agreements have expired and both have been pulled from the Dish line-up.

And like before, there is the necessary pr and paid advertising telling customers their side of the story in a time where consumers are simply tired of being part of every battle.  Frankly a no win scenario.  Some consumers switch cable operators as a result of the loss of channels, most remain.  Dish and its customers are used to such drops and re-launches.  Remember the AMC fight, the CNN battle? The dance is ongoing with short term suffering for fans of those respective networks.

Of course there are two sides to every story and the cost of cable programming certainly drives at the heart of such negotiations.  Operators will have a hard time paying to carry every possible linear network; those costs cause cable bills to rise.  Sports are a huge component of those costs, yet those networks are the hardest to drop.  Also because most major networks are owned by multi network businesses, leverage becomes a big factor in driving all of its networks to be launched.  Don't think Fox won't use pressure from its Fox Broadcasting, Fox Sports, FX, and others to drive a Fox News and Fox Business renewal.  Size does matter in these fights.  For now, Dish customers have lost access to a couple channels; in the long run, they will be renewed and added back to the line-up.  It is how the dance is done.


Friday, December 19, 2014

Apple iPhone Portends Good Things To Come

With Apple's release of the iPhone 6 and 6 Plus, it regained market interest and put tons of pressure on other smartphone companies.  The latest iPhone release could also generate over 70 million units just in this latest quarter.  And with that number on the street, Apple should see even more good news in 2015.

For one, the release of the Apple iWatch likely requires the iPhone 6 to fully function.  With 70 million plus in sales, the iWatch could prove quite popular. In addition, Apple Pay also requires the latest iPhone.  With security issues facing us today and credit card numbers getting hacked as well, Apple Pay will enjoy increased acceptance and usage.  And that spells another driver in Apple revenue next year.  Lastly, more converts to the iPhone means more usage of the app store and growth in iTunes revenue.  A Beats music subscription might just attract new users too.

Beyond the iPhone and another model in late 2015, Apple will surely update its laptops, Apple TV, and iPads.  With schools embracing Apple computers and tablets and IBM partnering in enterprise applications, Apple can make significant inroads in new industries.  And lastly, Apple might actually surprise some of us with an Apple smart television set.  You never know. 

Thursday, December 18, 2014

Dish Finds a Frenemy With Netflix

Demonstrating that cable and streaming content can live side by side, Dish Network has become the first major cable distributor to include Netflix on its set top box.  And like HBO or Showtime, Netflix will be treated as an add on package, purchased separately.  Consumers though don't need to jump from one box to another to enjoy all the content they want.  By including the Netflix app, Dish gives its customers convenience and simplicity in watching whatever content they choose. 

Per the Dish press release, "Additionally, in the future, titles available on Netflix could be integrated into the search functionality across live, recorded and Video On Demand programs for both the Hopper as well as DISH’s forthcoming OTT service."  To me, a fully integrated search feature encompassing all content on Netflix and cable would be truly valued by consumers.  Partnering with Netflix, Dish demonstrates that consumers simply want more content wherever accessible and that consumers will not drop Dish but value the content that is being offered through the set top box. 

Wednesday, December 17, 2014

Avoiding TV Ad Interruptions

As the holidays approach, gifts may include new Apple TV, TiVo, or Roku boxes, a Slingbox or Hopper or two, a subscription to Netflix or other services designed to help us avoid ad interruptions.  These products are popular, not just because they let us watch TV shows and movies, but because they let us skip through or avoid television ad messages.  And the more comfortable we get using these outlets, the more we seek them for our viewing pleasure. 

For content obtained off our TV, it is just as easy to record first and watch later with our finger pressed on the fast forward button every time an ad appears.  For cord cutters and those watching through OTT platforms like Netflix and Amazon Prime, shows can be viewed without ever an ad in sight.  We pause when we want to and not because an ad is present.  And so as TV ratings decline and we watch our shows on our DVR or mobile device, we can enjoy all our shows without those dreaded commercial break.

For advertisers, the challenge becomes watching ad rates go up for spots on linear TV viewing while viewership declines.  The economics seem off.  Consumers have grown tired of these ad interruptions with the only exception being big event programming like the Super Bowl where the ads become more interesting and note worthy.  For almost all other times, they are an intrusion. 

This trend toward ad skipping and ad avoidance with subscription programming will only continue to grow.  The current model seems broken and it may now be time to revisit the TV ad model.  Branded entertainment, product placement, show sponsorship may now become the ideal means to assure that advertised brands get noticed regardless of where or how the content is being consumed.  You can't avoid ads baked into the content of the show.  Till then, ad avoidance seems like to continue to grow.

The Digital Age At A Crossroads

While Sony's latest movie release, The Interview, may lack any sense of good taste, it is certainly in their right to produce and distribute it.  Why they chose to use an assassination of a live foreign leader, no matter how notorious, is beyond understanding.  But freedom of speech certainly gives them the right, even if it lacks a certain common sense.  Would the movie have even gotten made if it was about a current domestic leader?  Highly doubtful.

Still, two wrongs don't make a right and the work of hackers to infiltrate Sony and release sensitive information from their computers clearly crossed the line as well.  Worse comes threats made from these same hackers alluding to loss of life at movie theaters that go ahead and play the film.  Given such threats, some movie houses have already canceled showings of The Interview. 

The problem with all of this is that by succumbing to these hackers and their threats, it sets a dangerous precedent for future hackers to follow the same playbook.  Like they say about secrets, the moment you share something with someone else, it is no longer a secret.  And the moment we communicate digitally, it is there for eternity.  It may be meant to be shared with one or a few, but like secrets, others will try to access it.  In a world of great freedoms of expression, we sometimes forget our manners.

To the hackers exposing Sony secrets and threatening lives, one wrong move does not condone another.  And as a society, much must be done to stop these hackers from succeeding.  Not so this particular movie can play but that our freedoms remain intact.  And in the future, perhaps as a society we need to regain our politeness, our moral fiber, our consideration of others, for once something is said, it is there for an eternity. 

Tuesday, December 16, 2014

NBC Playing Nice With Corporate Parent

While CBS seeks to drive additional revenue through a subscription digital network service, NBC Broadcasting has chosen a different route.  Perhaps it is due to NBC being owned by a cable operator, but it also aligns both the programmer and distributor to the same synergistic goals, driving total revenue by backing an authenticated TV Everywhere platform. 

According to today's Wall Street Journal, "NBC is launching a live stream of its broadcast network, part of a broader effort at parent NBCUniversal to make more of its content available online via computers and mobile devices."  Not too many details in the article, notably if the signal will correlate to the subscribers home geography and its affiliates signal, or simply a national feed of the network.  And likely, there will be shows blacked out, including Sunday Night Football and other possible exclusions.  Other questions are whether it is just a live linear feed or if there will also be an on demand component.

Still, despite limited details, the approach by NBC clearly takes into account its parent company, Comcast Cable.  Requiring access to authenticated cable subscribers means added value to cable and an attempt to stop or slow down the rate of cord cutting.  Rather than be a revenue creator like the CBS or even HBO GO models, NBC is supporting the broader cable revenue model with hopefully greater total returns.

As to the marketing of the new authenticated service, NBC doesn't seem to like the TV Everywhere tag.  I agree.  It is reminiscent of the challenges that have plagued cable with the on demand tag being used in so many places it lost any traction with the cable brand.  But I'm not sold on “Watch TV Without the TV" either.  In a world of initials, perhaps branding it as "TVE" might be an interesting way to brand the digital feed of all its networks.  Brainstorming other phrases like Digital Broadcast (Cable) Everywhere.  Still, slowly but surely, TV Everywhere will one day become commonplace. 

Monday, December 15, 2014

Do I Know You?

Spam exhausts me.  From robo telephone calls to emails to regular mailings, I find the scope exhausting and unnerving.  And I suspect that most of you feel the same.  Its intrusive, and worse, a lot of it are scams. 

Lately, one such robo call, and you know who they are because it takes a couple seconds after you say hello for it to switch to either a live person or automated message, responds to my hello with the phrase "Don't hang up...".  I have no idea what comes next because I always hang up.  Another call that I get comes from someone who tells me that my pc has a bug and they have been notified to get in touch with me to help fix it.  Right!  Or you might just win that dream vacation!

On the email front has come a number of requests from Dropbox to tell me that a friend has sent me a file to open.  At first glance, one might click the hyperlink but truth is, the email does not come from Dropbox.  For each of these suspect emails, a quick look at the full email address indicates that it actually comes elsewhere, with many addresses containing the .edu email address.  Spam bank emails also want me to open some attachment too.  But the worst are the ones that look like they come from someone you may know, but clicking on the email address shows that only their name was borrowed, not their true email address.  At times, I believe I get more spam emails a day than real ones.  Delete, delete, delete.

I suspect that the many attempts occurring these days from spammers/scammers must ensnare a few or more people each day.  A shame for the unsuspecting who should be careful what they click or share with unverified accounts.  Unfortunately, its looking to be a growing business.  So be careful what you click. 

Friday, December 12, 2014

Does Instagram Really Have 300 Million Users?

Yesterday, social media erupted with the news that Instagram has more users, 300 million, than Twitter, which claims 284 million.  An impressive number indeed for both platforms, but is it real?  The question may be how many real, unique users do these social platforms have and how many are fake.  How many are unique individuals and how many are being used by companies as marketing tools for promotion?

In my own household, my children both have Instagram accounts, neither have a Twitter account.  I think the picture sharing is the primary appeal for usage.  But I have also learned that many teens have multiple accounts and some enjoy the game of creating fake accounts, "Finstas" I believe they are called, as joke accounts.  So between these fake accounts, corporate accounts, and other automated programs to falsely drive followers and clicks to sites, how many of these social media accounts are unique and real?  300 million sounds like a lot but what is the real number. 

Thursday, December 11, 2014

Sling Media Derides Cable's Current TV Everywhere Platform

Sling Media doesn't mind slinging a little mud in its latest advertising campaign against cable TV.  As I've argued, cable needs to embrace a true TV everywhere approach to enable its authenticated customer to watch all its programming, both on and off the cable box.  Unfortunately, programming agreements and content rights management currently hampers the ability to push such a strategy.  But Sling Media has built the elegant work-around with a box that talks to the cable box and then streams it to other mobile devices. 

Sling's owner, Dish Network, integrates Sling into its box making it a more ideal approach, but cable operators have been reticent to bring Sling technology into their own cable box.  So to attract non-Dish customers to Sling, according to Deadline, "launched an ad and social-media campaign that ridicules TV Everywhere – the cable and satellite initiatives that stream programming to subscribers. The messages urge consumers not to get “C.W.A.P”, a Sling acronym for 'Can’t Watch Anywhere Pain.'” 

As I mentioned, buying Slingbox has its advantages but it also requires that you have a cable set top box that can be used specifically for streaming.  Those in the home can't use the cable box while it is being used by the Slingbox.  And only one channel can be streamed at a time so that different members of the household can't all "sling" at the same time.  Despite all this though, it does provide the opportunity to watch every linear and on demand show that comes off the cable box, through the Slingbox, and streamed to any mobile device around the world.  It is a true TV Everywhere approach. 

Will this ad campaign move sales of the Slingbox?  Most households tend to be technologically challenged.  Heck, we even need help from our cable company to set up our cable box, modem, and wifi.  For those in the know, the Slingbox can be an exceptional value. 


Wednesday, December 10, 2014

Suburu Uses Branded Content To Its Advantage

Armed with research on who buys its cars and where they are likely to reside, Suburu found a nice fit with IFC's quirky cable show Portlandia.  And while running ads along side the program is nice, integrating into the show is better.  So as Portlandia premieres its 5th season, Suburu cars will be featured inside the series.  Along with other marketing tactics, this branded content approach assure that viewers will see Suburu product placement as they enjoy the show.  And the benefit to Suburu seems well worth it.

For one, consumers won't be able to fast forward through it, the car is tied into the fabric of the content. Two, with the show based in the Northwest, it reaches a strong segment of the market that purchase Suburus. Third, the Suburu brand continues to be seen, post the initial run of the show, with repeats, on demand, and future syndication and streaming.  And fourth, it receives great press coverage including a full article in today's New York Times

Of course the biggest challenge to branded content or any content that is pre-taped and run months or years later, is when the unexpected occurs.  A negative news story, a recall perhaps, or possible indiscretions that turn a once popular program into a problem.  I speak most recently of two incidents, Stephen Collins and Bill Cosby, and the effect on their older shows, 7th Heaven and The Cosby Show.  Their negative publicity extends to the shows they appear on.  Unlike an ad that can be removed, when branded content is woven into the fabric of the show, it is there forever, through the good press and the bad.

But for now, the use of branded content by Suburu and others is a smart decision.  While its core message may not get presented, its brand awareness and engagement by the viewer can drive future interest and hopefully sales for the auto company. And the resurgence of branded content is a great means to fight ad skipping and the rise of streaming. 

Tuesday, December 9, 2014

Hey TV, Netflix Is Your Frenemy

What do you do with an entrant in your business that spends millions of dollars for your content but also is taking viewers away from your channels?  That is certainly the question poised in today's New York Times on the Netflix Effect on television. 

Consumers are watching television differently.  The cost of cable television has skyrocketed while society has become more mobile. Linear television makes us wait while on demand and streaming lets us control when, where, and how we watch our shows.  And while advertising pays for programs to be made, subscriptions can as well while eliminating the interruptions of commercial breaks.  As a result, Netflix has disrupted the traditional model.  Truth is that linear TV will not go away.  When we don't know what to watch, we can still graze across all the choices and find a show to watch.  And live events force us to wait to watch at the appointed hour.  Netflix and other streaming services simply provides us with more choice as well as more flexibility. And advertising free is a nice benefit.

Television has been slow to change their current model.  It took years for content companies and cable operators to invest in on demand.  And their authenticated TV Everywhere model still lags as a competitive solution.  Netfix Chief Content Officer Ted Sarandos has offered a possible idea for cable operators to pursue.  "Rather than debate what is driving that change, established television companies should change their business models, Mr. Sarandos said. As an example, he said that cable operators should invest in new technologies that would allow people to watch TV episodes weeks after they have been broadcast, but allow advertisers to insert up-to-date commercials."  My one change to that idea, not weeks later but the next day and to keep it accessible for a month or longer.  And lastly, enable authenticated devices outside the cable box to access the content. 

Ultimately, Netflix will be seen by the consumer as a complement to cable TV, not as a direct threat.   Consumers will seek the platform that serves the content they want to watch.  TV viewership may continue to migrate to streaming until a new balance is found.  But cable operators can pursue a more robust authenticated TV Everywhere model that delivers a great platform of easy to find, easy to view, and easy to monetize content that will serve future generations. 


Monday, December 8, 2014

Will FCC Approve Cable Mergers?

The FCC is back on the clock but no decisions will happen in 2014 regarding the two mergers on the docket, Comcast acquiring Time Warner Cable, and AT&T acquiring DirecTv.  Per Business Week, it is unlikely that any such approval or disapproval will happen till March at the earliest. 

Consolidation offers great cost efficiencies but it can also hurt competition and lower prices.  Given the high barriers of entry in the industry and limited competition due to franchise approvals in every community, consumers have already experienced limited choice for cable or satellite.  These two mergers do little to worsen the already limited playing field.

The FCC may be less concerned with cable and more concerned with broadband access.  Still, there is limited competition with buyer and seller in this market as well.  DirecTv doesn't even offer a broadband business and Comcast and Time Warner do not compete against each other.  Comcast would control a vast majority of the US market seeking to access cable and broadband.  But I don't believe it will stop these mergers from occurring.  Opening spectrum, encouraging new entrants to enter the space, and supporting investment in new wireless and broadband technologies to improve connectivity and speed are what consumers really want. 

Friday, December 5, 2014

Microsoft Misses With Nook

The partnership between Barnes and Noble and Microsoft is officially over although its hard to say that it ever really started.  Despite a $300 million dollar investment back in 2012, nothing particularly visible to the consumer ever occurred and Microsoft leaves with a loss.  So much potential, so little execution.

Truthfully, when the Nook partnered with Samsung on its tablets, it was apparent that Microsoft was no longer a part of the conversation.  But that may have been decided when Microsoft's new CEO, Satya Nadella took over.  Per CNET, "Since taking the helm in February, Nadella has said that he wants to focus Microsoft's business on the core elements of its operation, including the cloud and mobile."  And now B&N can begin to separate its Nook business from its bookstore business. 

It is a missed opportunity for Microsoft and B&N, but perhaps a win for Samsung, Apple or others.  Going forward, I believe that B&N should work with a device maker on a tablet that is specifically designed for students, ideally college and high school.  All textbooks should be digitized for this new device as well as designed for note taking on the pages and a means to capture and organize the  writing for test taking and report writing.  This new device is not meant for games or non academic purposes; rather, a unique featured device to support school curriculum.  I see it as a niche device not as general purpose as the current Nook, Galaxy, or iPad.  By engineering it with a writing instrument that can translate writing into digital, it will enable students to better organize classroom work with connected textbooks.  For B&N, its future and its growth is in the education market and it needs to embrace the industry quickly.

For Microsoft, the opportunity to seize on this market ends with this partnership.  Given their new direction, it is clearly the right move for Microsoft to terminate this agreement.  But it is the right move for someone else. 


Thursday, December 4, 2014

NY Times Losing More Reporters

Pogue, Carter, and now ad columnist Stuart Elliott join the exodus of those leaving The New York Times.  Like Bill Carter, Elliott chose the buyout offered to him and others before layoffs were to be imposed.  And while the bottom line is that everyone is replaceable, their uniqueness can not.  But it certainly changes the value of the content for the NY Times.

Of course the only constant in this world is change and whatever comes next for the writing in the NY Times could be better or worse than what we are getting now.  The future is uncertain.  But like a good baseball team, we don't know who is in the NY Time farm system to rise from the ranks to replace these reporters.  Nor do we know if they plan to "trade" for them from another notable publication.  For now, all we do know is that an ever larger hole is opening that the Times will need to fill if they plan to stay a relevant media outlet.

Wednesday, December 3, 2014

Traditional TV Viewing Drops 4%

First and foremost, television is not dead.  It may have matured quite a bit, but opportunities still abound for those companies that see growth.  Still, the news out of Nielsen, from today's Wall Street Journal, is that "traditional television dropped nearly 4% last quarter, as online video streaming jumped 60%, according to a new report from Nielsen, crystallizing a trend for TV-channel owners amid ratings declines."  Expect that percentage to continue to drop. 

The simple truth is that there is only 24 hours in a day and the rise of new media means that old media must lose some usage as users aggregate to the new trends.  Print is feeling that effect from digital, radio felt it from broadcast and broadcast from cable.  Online viewing will simply take from those platforms.  But television, and the people that control them, can still drive success and growth. 

The notion of authenticated TV Everywhere with the cable operator bridging the gap of the cable box in the home with online access anywhere and everywhere still makes sense.  It enables customization, personalization, recommendation, and ultimately owns and tracks the viewer regardless of the device used to view the media on.  That consolidation and convergence creates an advanced advertising approach and data collection so valuable these days.  But until cable operators fully envelop the consumer in this bubble, consumers will find entertainment outside the cable box with other content and other OTT platforms. 

A 4% drop in traditional TV viewing is not the death of traditional TV.  Hopefully, it is a real wake up call to once again purse a TV Everywhere strategy.  Slingbox offers the technological tools to do it.  TiVo may as well.  Cable operators need to push it further and market the TV Everywhere value that they can one day deliver.

Tuesday, December 2, 2014

Bill Carter Leaves NY Times

If there was anyone with his finger on the pulse of television, especially late night television, it is Bill Carter.  As both a reporter for the NY Times and an author of books like The Late Shift, Carter is a recognizable name in the world of media.  But the financial issues of newspapers and the NY Times in particular have taken their toll and the result is a loss of talent.  Offered a buyout package with considerable weight, Carter chose to take the buyout and leave his NY Times post. 

The NY Times loss may just be someone else's gain.  Just as David Pogue left the Times for Yahoo, Carter might find open arms on the digital side of the world.  And for those of us seeking another book, he now has time to work on one.  Unfortunately for The New York Times, losing recognizable content creators like Bill Carter makes it harder for them to deliver best in class writing.  It only provides more impetus to also unsubscribe from the Times for online content. 

Monday, December 1, 2014

Fox Blacked Out On FIOS In RI Over Thanksgiving ... Heartless

While CBS and Dish agreed to an extension so as to not ruin their Thanksgiving break, Verizon FIOS and their Rhode Island Fox affiliate could not.  The result, the station " went dark to the telco’s customers at 3 a.m. on Thanksgiving after the parties failed to reach a renewal accord. That meant that some 400,000 FiOS customers missed the Dallas Cowboys’ Turkey Day turkey against the Philadelphia Eagles and may be without Fox’s NFL lineup on Sunday. "  And while we all know that eventually the two sides will sign a contract, causing license fees to rise and ultimately, customer subscription fees as well, current subscribers are simply on the lose-lose side of the negotiation and the outcome.

According to Cynopsis, "Fox led all Thanksgiving NFL telecasts with 32.0 million viewers for Eagles-Cowboys in the late afternoon window, marking it the network’s best regular-season telecast of any kind since 1998".   Given that 400,000 households couldn't watch the game, that number could have potentially been higher.  

According to reports, it was the Fox station owner, Cox Media Group, that chose to black out the signal to FIOS, a move that does little to help their negotiation, especially when done over a national holiday.  That neither side could find any sense of humanity to delay such a move, especially when no work would be done over this particular long weekend, should cause outrage across Rhode Island, if not nationally.  In fact, it was a heartless move.  For CBS and Dish, they may still move ahead to a blackout to push their negotiation stance, but at least they put the holiday and their viewers ahead of commerce.  

Wednesday, November 26, 2014

CBS And Dish Agree Not To Fight Over Thanksgiving

Dish subscribers take not, the Grinch has not come to take your CBS network off the air...just yet.  With Thanksgiving a day away, the two parties have agreed to an extension into next week.  That means that the lawyers for both parties would rather be home over the long vacation break then squabbling over contract terms.  That can wait till Monday.  And so Dish customers and Dish employees can breathe a sigh of relief and enjoy their football and other CBS programming this Thanksgiving weekend.  HAPPY THANKSGIVING!

Tuesday, November 25, 2014

Discovery Adds To The Layoff Announcements

In my blog the end of last month, I noted the slew of end of year job layoffs across the media industry.  With the holidays coming and deep into Q4, those notices would only continue.  Although just announced in the press, it is my understanding that layoff notices at Discovery were received last week.  Per Multichannel, it was " a decision to consolidate its regional offices, leaving only a senior executive in cities like Detroit and Atlanta rather than a larger sales team."  Layoffs affected more than the ad sales group as affiliate sales and other functions were also hit.

 As for the programmer community, Discovery, Scripps, Fox, AMC, and others have all seen layoffs at their respective companies.  Given consolidation occurring at the cable operator levels, programming companies could see similar consolidation in the coming year.  And that will only mean more layoffs.  With more content heading toward digital, less people are needed to run affiliate sales and marketing.  And the ad sales efforts continue to get more automated and programmatic.  But like all we have seen before it, this move is cyclical and at some point more employees will again be needed to fun new monetization opportunities. 
the move also reflects a decision to consolidate its regional offices, leaving only a senior executive in cities like Detroit and Atlanta rather than a larger sales team. - See more at: http://www.multichannel.com/news/advertising/discovery-latest-cut-back-staffers/385840#sthash.RU1cW7QN.dpuf
the move also reflects a decision to consolidate its regional offices, leaving only a senior executive in cities like Detroit and Atlanta rather than a larger sales team. - See more at: http://www.multichannel.com/news/advertising/discovery-latest-cut-back-staffers/385840#sthash.RU1cW7QN.dpuf

Monday, November 24, 2014

Radio Redux via Podcasting

The world is cyclical and no matter what we do, history tends to repeat itself.  For those that can spot the trends, they can work to not repeat horrible historical events or capitalize on them.  In media, those cycles repeat themselves over and over again, just as TV copied radio, cable copied broadcast, and now digital is doing the same to TV.  We learn from the previous institution and reimagine it under new technological advances.

The world of radio was once the place for serialized dramas, comedies, and other theater of the mind broadcasts until the world of TV added pictures to the sound.  Radio morphed into news, talk, especially sports talk, and music.  But with the rise of the podcast, theater of the mind has come to the digital age.  The latest podcast is the much talked about Serial from the producers of This American Life. Per the NY Times, it is the "re-examination of the 1999 murder of Hae Min Lee, a Maryland teenager, that resulted in the conviction of Adnan Syed, her former boyfriend." Episodes range from 30 minutes to an hour and draw out slowly new information about this very real case.  And it is capturing a significant audience of listeners, including my own family. 

In an age where most of us seek out the full experience of sight and sound, this series has reminded us of the power that an audio broadcast can offer.  As more and more people hear about Serial, it is likely that it will enable other podcasts to benefit from this new interest in the spoken word.  And perhaps the radio medium itself can choose to revisit what once made them the instrument when millions of households would sit around the radio to listen to the next episode of Dragnet on the radio or Fibber McGee and Molly.  That podcasting has revitalized the audio broadcast once again demonstrates the cycles in our world and that history does indeed repeat itself. 

Saturday, November 22, 2014

Aereo Files Bankruptcy

According to the NY Times, Aereo has filed for bankruptcy under Chapter 11 ending its run as a cable TV disruptor.  The Supreme Court ruled against the Aereo business model which enabled consumers to lease remote antennas to access over the air broadcast signals, digitize, and stream them for viewership.  Shows could be recorded for later viewing or streamed live to any device.  That model proved fatal for Aereo.

As to next steps, Aereo will try to sell off its assets.  And other OTT businesses will come up with different means to capture and transmit signals by placing antennas directly at the consumers' home.  Aereo's loss was the broadcasters gain. CBS has jumped on it by creating its own OTT subscription service for viewers to stream and watch its programming.  Perhaps other broadcast networks will follow.  Still, Aereos' appeal was that it aggregated all the broadcast signals onto one platform for an easier experience.  Farewell Aereo, your business model may have been in vain but as a disruptor you sure did light a fire to change. 

Friday, November 21, 2014

Amazon To Offer Ad Supported Video Streaming Service

Amazon's plan to rule the online universe has taken a fresh turn with plans to expand its video strategy.  Currently offering Amazon Prime, a $99 a year service that includes video streaming, free shipping, and more, its next move is a separate free, ad supported video streaming service to attract a larger audience.  While no specific launch date was announced, the service could appeal to cord cutters among others.  And while some think it could hurt the Netflix subscription model, I actually believe it will only help it.

For Amazon, it offers another way to monetize its exclusive online content, shows like Alpha House and the new kids series, Gortimer Gibbon's Life On Normal Street, as well as acquired programs from HBO including The Sopranos, Deadwood, The Wire, and more.  Adding an ad component will also help track and perhaps even enable its advertising to lead to online purchase behavior (on the Amazon website, of course).  The data of users to the service coupled with their purchase behavior could bring premium ad pricing.  Plus, the appeal of the Amazon free streaming service might eventually upsell them to a Prime customer.

Why shouldn't Netflix be worried?  Viewer consumption of programming is based on appeal and interest.  With its blend of original and acquired TV and movie content, and a relatively inexpensive monthly price, Netflix customers will remain as long as there is always a breadth and depth of content choices.  But Netflix might just consider a free ad supported service to both monetize its video content and drive adoption to upsell to its subscription service, too.  And Netflix, because they are not tied to their own e-commerce model could also offer a click through to other online retailers to purchase after viewing an ad.  Netflix might like a piece of that action, as well.  The only downside for Netflix, that customers drop the paid subscription for the free model, but it might be worth the risk.






Thursday, November 20, 2014

Dish Facing More Network Drops

Dish Network doesn't seem to mind that it is facing multiple contract issues with its programmers.  Last month, CNN and Cartoon dropped off the channel line-up and now they have a possible CBS drop on their hands.  But to keep laying it on, the rest of the Turner Networks, TBS and TNT in particular, are also set to be turned off.  For Dish subscribers, the loss of a cable network is a nuisance, the loss of a broadcaster is a headache. 

With carriage of pro football games, rating dominant prime time programs, and more, CBS can create a major headache for Dish just as it did in its negotiations with Time Warner Cable in Los Angeles.  That drop caused a large number of subscribers to drop their cable service for another provider.  Could a CBS drop on Dish cause the same significant subscriber loss? 

Yes, these programmer - cable distributor boxing matches seem to happen every year.  A network's contract expires, the signal goes dark on the line-up, consumers complain, and eventually, after a PR blitz, the service is restored, and the cycle starts again for another programmer.  A sorrowful process that continues to repeat.  As for the subscriber, we become numb in the process and eventually figure out that no matter where we end up, the same type of fight will emerge on that distributor.  Another reason consumers are dropping their cable cord altogether and seeking content over the top. 

Wednesday, November 19, 2014

Nielsen Attempting To Measure Netflix

It is hard to get an accurate count when companies don't want to be counted.  In today's Wall Street Journal article, Nielsen hopes to measure usage of both Netflix and Amazon Prime through its audio feed.  And while it may garner some information, it comes across as half-baked.  First, it only measure on connected TV sets, "Nielsen is still working on a way to measure subscription-video viewing on mobile devices, where such technology won’t work."  And second that it is being done without Netflix or Amazon's support.

Of course, getting good data is key to essentially what content owners want to know, "Is putting content on Netflix impacting the viewership on linear and traditional VOD".  But as more and more Netflix consumption is on mobile devices, the value of the research may be strained.  Common sense may already tell content owners what they implicitly already know.  Viewership is shifting from cable and broadcast to digital streaming media.  Current research already confirms this trend. 

Why doesn't Netflix or Amazon care to be measured by Nielsen.  Their revenue comes from subscription to their services and not from advertising.  Internally, they know who has subscribed and what they are watching.  And so, doing a deal with Nielsen today doesn't seem to be a high priority for either service.  For Nielsen and its customers, the data gleaned from this workaround collection process, via audio, may tell a story, just not a complete one.  Content owners that are doing programming deals with OTT providers see it as another window of revenue opportunity. 

And while it may create an issue of cannibalization that could hurt ad revenue in other windows, it can also help to draw new audiences.  Case in point, Breaking Bad on Netflix of older seasons led new audiences to catch up on the series to then head over to AMC to watch the current season play out.  A win for both platforms.  And one day when Orange Is The New Black sells a cable distribution window, the buzz it has gotten from Netflix should draw large audiences and consequently ad dollars.  And Nielsen needs to find a way to accurately measure all streaming usage. 

Tuesday, November 18, 2014

NYC To Replace Payphones With WIFI

About a year from now, NYC will be offering free wifi access; sure Starbucks offers that now, but the city hopes to create a fast public wifi link using payphone kiosks to transmit a 150 foot perimeter in order to connect.  And NYC hopes to profit from this new business venture through advertising on payphone kiosks.

Initially, I thought that such an ambitious plan would enable apartment dwellers across the city to ditch their cable company and get high speed access to watch Netflix and other content without paying an ISP provider.  But 150 feet may not reach many people in their homes.  At the same time, New Yorkers using that end up using the new wifi service will most likely have to be outside to access.  Okay in the summer, less so in the winter.  And wouldn't you rather sit down in a nice coffee shop than stand outside and freeze your behind off as you surf the web.

As to advertising, with so many digital billboards already overwhelming our senses in the city, it is hard to imagine that more kiosks will provide a positive ad experience.  And per Mashable, "Users will only have to log into the network once, making the transition from one hotspot to the next seamless." Thus no real online ad opportunity.  

Such a program seems beneficial to NYC residents with free wifi and free domestic phone capabilities.  And if the radius of wifi access can be significantly expanded, a nice alternative to the cable and phone company; in fact, a potential competitor.  But as a business, it is hard to see it being profitable for its owners.  And while there is worry that a public wifi hotspot could affect our privacy, we have already accepted these wifi hotspots as we enter coffee shops, department stores and other establishments.  It seems few of us care about privacy. 

Monday, November 17, 2014

Apps Changing Internet Usage

Today's Wall Street Journal reminds us that when we enter a particular app on our mobile device, we are essentially entering into a walled garden of specific information, disconnected from the open world wide web.  According to the article, we have changed how we surf, spending more time with apps than with an internet browser.  "On phones, 86% of our time is spent in apps, and just 14% is spent on the Web, according to mobile-analytics company Flurry." 

And we have seemed to fall in love with our apps to find and share information fast.  The article worries that once we are inside a particular app or walled garden, we are then subject to its rules and whims, limited by what the particular app wants to allow us to see or do.  Most interesting to note, "The Web is built of links, but apps don’t have a functional equivalent."  We stay inside the garden unless we choose to venture again outside to seek additional information.  And unless we look outside the gates, we may not be exposed to new information. 

The article certainly doesn't see apps as bad, but as perhaps the next development of a changing platform.  The challenge is to find a way for openness to emerge.  The author's conclusion seems a sound one.  "It is that in the transition to a world in which services are delivered through apps, rather than the Web, we are graduating to a system that makes innovation, serendipity and experimentation that much harder for those who build things that rely on the Internet. And today, that is pretty much everyone."  If that is the case, I'm sure brighter minds are working on new types of app search. 

Saturday, November 15, 2014

Verizon To Sell A Mobile Cable Subscription

With the purchase of Intel's OnCue business, Verizon is embarking on a plan to offer a mobile version of a cable subscription business according to Wireless Week. Using their LTE mobile spectrum, Verizon plans to deliver a cable-like platform of channels for consumers.  And while launch date, subscription pricing, and other information is yet to be announced, it appears that Verizon sees an opportunity to attract cord cutters with a new approach. 

Cord cutting continues to grow as 150,000 households shed their cable subscription as of July 1 of this year.  According to Mashable, Time Warner Cable and Comcast were hit the worst.  Verizon's new pay-TV service could further attract cable customers to shed their physical cord for a mobile cable experience.  Verizon already understands the overbuild mentality as it markets its FIOS business in markets with cable providers.  Verizon's mobile business could potentially cannibalize some of its own FIOS customers although cable opertaors are more at risk.  And FIOS could market a mobile package that delivers the ultimate in a TV Everywhere approach. 

As OTT continues to mature, and platforms like Hulu and Netflix attracting subscribers, networks like HBO, SHO, and CBS are developing their own OTT models.  Verizon's mobile platform could be a boon to these networks and others.  It may also allow Verizon to start over to build and bundle services that consumers actually want to watch at a price point that is acceptable to them.  And if successful, this new business could truly disrupt the cable subscription model. 

Friday, November 14, 2014

Data May Be True King When It Comes To Success

Having content to view may not be the same thing as having content that people watch.  And when it comes to measuring success, how many watch, who they are, what they like, and where they go may ultimately determine how successful any piece of content can be.  The data behind the content, the analytics and insight derived from who is watching a piece of content is imperative to financial success.  It is reminiscent of the adage asking if a tree falls in the forest and no one is there to hear it, did it make a sound.  That data is crucial especially when it drives advertising dollars.

The buzz on measurement of content, whether linear, on demand, streaming, or download requires that it is properly being collected, that it is accurate and correct, and that the time frame in which it is collected is relevant to the process.  And for media buyers, that reaching an audience is not just a size based proposition, but also efficiency to a segment of the population you are trying to reach, whether age based, gender, income, purchasing behavior, etc. 

The system today seems far from perfect.  Do we count live only views, Live and same day delayed, or +3 day or +7 views.  Did the pre-roll play, was the sound on, was it fully visible, and is it a real impression?  Questions of fraud remain part of the conversation.  Still, with verified data, the value is essential in making content profitable.

Thursday, November 13, 2014

Like iPods Product Line, iPhones Will Also Lower iPad Sales

Technological cannibalization seems to be the norm and no one is more aware of this impact than Apple.  When they introduced the iPhone, many worried that iPod sales would be hurt.  And they were right.  But the innovation of the iPhone, while cannibalizing iPod sales, also enabled Apple to succeed.  The same cycle is now repeating with the iPad.

While iPods continue to sell, they represent a smaller business then before.  With the introduction of the iPhone 6 and 6 Plus, Apple recognizes that it will cannibalize sales of its iPad.  In fact, it could lead to the drop of the iPad Mini model.  At the same time, the iPad may fine more uses in business sectors then in the consumer market.  And as iPhone sales makes iPads less desirable, they may also help sell more laptops.

With the MacBook Air and MacBook Pro getting lighter and more powerful, Apple users may find these products, linked with their larger iPhones as the perfect combination.  MacBook sales in general have been rising as PC sales are declining.  This trend seems likely to continue.

For Apple, they seem to have no problem letting cannibalization occur.  It is in their best overall interest to not try to save declining products but to focus on the synergy of their total product line.  With the introduction of the iWatch in 2015, that synergy is likely to continue.

Wednesday, November 12, 2014

Net Neutrality Laws Not The Answer

Do we have a problem with our internet, the simple answer is yes.  But regulating access to assure that all content gets equal access may not be the correct course.  As many like to say, too much government interference, limits growth, and if treated like a utility, would hamper innovation.  Our problem is not that some traffic on the internet superhighway gets clogged; rather, that the whole highway is a traffic jam.

As the Huffington Post pointed out last month, "Americans pay far more and get far less when it comes to the Internet than many other people around the world." Broadband connectivity in the United States is more expensive than other countries and our overall speeds are slower, too.  With more and more devices trying to get online, the highway can come to a noticeable stop.  In my home, watching a video on a tablet causes other computers in the house to stop loading web content.  Too many users on a cable broadband line slows overall speeds. 

How do we improve the broadband highway.  Not through regulation, but by lowering the barrier to competition.  Eliminate cable franchises and open spectrum.  Let overbuilding encourage more competition.  More competition drives better pricing models and gives consumers more choice.  Too much regulation is not the answer.  We've recognized the problems but need better solutions. 


Monday, November 10, 2014

Obama Wants Net Neutrality

With two years left on his presidency, President Obama has decided now is the time to speak out on net neutrality.  He has asked the FCC to pursue full net neutrality and to enable free and equal internet traffic for all.  Whether a data heavy, video driving site like Netflix or a low graphics, easy downloaded website, consumers should be able to access both equally as fast.  No HOV lanes, no slow downs by ISPs.  I'm almost surprised that he didn't try to have all broadband as a utility, subject to the same rules as water, gas, and electric.

The real challenges for the US regarding internet access are speed and price.  Shouldn't more be done to encourage wire and wireless competition.   Is net neutrality the better policy course to driving innovation and superior service?  Shouldn't the FCC focus instead on opening up more spectrum for more ISPs to enter and compete for users.  If internet speeds can be improved, then all traffic will thrive, whether they are in a slower or faster lane.  Then how fast any one piece of content is over another will be meaningless if there is no perceptible difference. 

Friday, November 7, 2014

Should Cablevision Seek A Buyer?

Cablevision announced its third quarter financials and the news suggests trouble.  While revenues rose through price increases, growth has stopped.  Like other cable operators, Cablevision faced another quarter of cable subscriber drops, losing 56,000 households.  The trouble for Cablevision is that while other cable operators see growth in their broadband subscribers, they encountered a drop of 23,000 homes.  That spells major trouble.  Price increases to current homes may mask some concern, leading to Q3 revenue growth of 3.7%,  but continued cable and broadband subscriber drops cannot be overcome with more price increases.  The dam may be ready to burst.

So is there an exit strategy?  Is CEO Jim Dolan still committed to Cablevision or is he willing to finally jettison the asset and concentrate on his main loves, MSG and his music?  Do they have the ability to right this ship? Or is it time for Cablevision to find a buyer?

Cablevision lost a strong leader in Tom Rutledge a few years ago when he left Cablevision to run Charter.  Could Ruttledge be interested in acquiring Cablevision and once again taking control over the troubled empire?  With Comcast and Time Warner Cable busy on their merger plans, Charter could be the likely front runner.  And Rutledge seems to have the Midas touch when it comes to cable operations.  Given Cablevision's stumble, the timing might be right to consider making a bid.  And the answer to the title is yes, Cablevision should start seeking a buyer. 

Thursday, November 6, 2014

Ad Spend Shifts To Reach Consumers

Today's Wall Street Journal reports on the shifting dollars of ad spending.  The concern is that ad dollars are flowing away from television and toward digital content.  And while it is described as shaky, it is hardly earth shattering.  Truth be told, these shifts are simply part of long term trends that have affected media buying for quite some time.  And those media that don't remain flexible to changing viewership patterns eventually become irrelevant. 

Old technology gets replaced by new technology; the horse drawn carriage by the automobile or the train by the jet.  For those that can predict the shift comes the ability to take a product or service from birth to maturity.  And while old technology like the train may lose some market share to the jet, it still can survive as a mature business.

Back to advertising, media has watched audience usage shift from print to radio to broadcast to cable to digital.  All media platforms remain available, but start to be used differently.  Radio is no longer the home for 30 minute sitcoms or dramas; today they are music, news, talk, and sports.  Those long form shows shifted to television as audiences demanded first video, then color over black and white.  Today those viewers now want portability, personalization, and on demand, something that digital can do very well.  But TV is not dead or even on shaky ground.

According to the research from MoffettNathanson, broadcast and cable are still growing, simply at a slower rate.  It is the maturation of the TV platform as another takes over.  Viewers are a fickle bunch; one year they love the content you offer on your broadcast or cable or theatrical platforms and the nest year, interest has waned with your content and moved to another content creator.  And digital platforms like Netflix and Hulu and Amazon and others let viewers watch shows and movies on their terms.

Still this shift of viewership from TV to digital could change the cable landscape.  In the beginnings of cable television, networks were created to reach segmented interests.  You had an arts channel, a sports channel, a comedy channel, a movie channel, and so on and each channel had a clear segmented identity.  Where broadcast networks reached a broad audience base, a cable network could reach a smaller, albeit passionate viewer segment.  But as cable grew up, it started to want a bigger share of the pie.  Those individual identities began to soften as networks widened their reach with more varied programming categories.  Today, most cable networks look like broadcast networks.  And with so many lookalike networks, segmentation turned into fragmentation.  It seems the next step for cable TV may be for consolidation as smaller networks get dropped off the line-up.

TV ad spend will continue to shift as new platforms emerge and audiences embrace these new ways to interact with content.  Broadcast felt it as cable networks gained better programming and more viewership.  And TV as a whole will feel it as digital gains better programming too.  The shift is inevitable and like before, the trend will only continue.  The smart content distributors will embrace digital and capture the dollars regardless of the platform its content is on.  HBO and CBS offering unique digital subscription models is one such example.  Hulu Plus, a consortium of broadcast media ownership is another.  Their is nothing wrong with TV ad spend, it is just following the same trends that have affected it before. 


Wednesday, November 5, 2014

Spotify Loses While Taylor Swift Gains

Aside from her musical talent, Taylor Swift could also be described as a marketing expert.  Faced with digital disruption in the music industry, she caused a disturbance in the streaming music industry that helped to drive her album sales.  Fans couldn't listen to her album without paying for it, so they opted to pay for it.  The result, 1.3 million album sales in the first week.  We can only expect for total album sales to go higher.

Certainly Spotify was not truly hurt by the loss of one artist.  The challenge will be that others will follow the Taylor Swift strategy of promotion, limited streaming availability, and other marketing tactics.  Access to current musical content could cause Spotify and others to remodel themselves to maintain subscription growth. 

By the way, Swift's album 1989 was the first album to top a million in its first week in 2014 and currently ranks as the "second-highest seller overall, behind the Frozen soundtrack." 

Dish Network Not Afraid To Drop Channels

Last month, Dish Network dropped most of the Turner Networks, the most notable being CNN, especially given this being an election year.  And while, they reported a small drop in subscribers for the third quarter, the belief was that the loss of Turner nets was not a big deal.  Rather, according to the Wall Street Journal article, "Subscriber growth has been hurt by quality-of-service issues, Dish said, including not meeting its own standards for installations, answering subscriber calls in an acceptable time frame, and equipment reliability. The company warned that these issues could affect revenue growth in the future."

Cost control is a driving factor in the cable game as consumers fight the high cost of cable television by dropping their service for OTT programming.  Dish recognizes the challenge of keeping their subscribers and limiting price hikes, especially those caused by higher license fees.  At the same time, Dish is focusing on the online market with possible plans to build out their own low priced video service.  That may be a hard business to pull off unless Dish can integrate its license fee deals for online content with its satellite deals to assure the best rate for license fees. 

Turner won't be their only problem.  The article reports that the CBS deal will also expire by year end.  Watching what happened to Time Warner Cable after its war with CBS, Dish may be more willing to negotiate with a broadcaster like CBS, then with a cable programmer like Turner. 

Tuesday, November 4, 2014

Taylor Swift Tells Spotify To Shake It Off

Free does not seem to be a good business model in the music business.  Faced with a digital disruption, music sales have been seriously hurt.  Music stores like Tower Records and HMV are gone and customers who once bought physical copies of music on vinyl or cd are now moving to digital downloads, while others are enjoying the access of music through streaming services.  But artists are also seeing less of a return on their creative expression and Taylor Swift has decided to do something about it.

On Monday, she pulled all of her music from the free streaming service Spotify.  Certainly, the decision was a financial one.  With single and album digital downloads down, and streaming usage up, the economics don't favor the artist.  The limited streaming availability may be part of a supply and demand relationship.  Cut back the supply and demand for Swift music will rise with purchase the more accessible option over streaming. 

And while Spotify has lost access to Swift's entire music library, Mashable notes "that Swift's music, sans 1989, is available on the Apple-owned Beats Music service, a smaller streaming rival whose executives have stressed a desire to secure artist exclusives." How long that lasts or what the business move is behind the arrangement may soon come to light.

As single artist pulling music from Spotify and other streaming music services may not cause major disruptions, but the success of such a move could be the disruption that causes other artists to do the same thing and alter the entire streaming business model.  Spotify needs content to attract its audience; without it, consumers will seek other sources.  The biggest concern though for the artists are that such a move leads consumers back to the Napster days of illegal downloads.  Some revenue may be better than none at all. 

Monday, November 3, 2014

CNET Adds Print To The MultiPlatform Mix

It sounds a little bit old school, but CNET, the technology website wants to recapture attention with a new quarterly print magazine.  Unfortunately, CNET's owner CBS no longer has a magazine publishing arm, so its back to square one.  But it may just recapture the sparkle in CNET that it needs.

So what is the broader market strategy for CNET.  According to the NY Times, "The arrival of CNET in print is indicative of a trend: Brands that began digitally are turning every day into #ThrowbackThursday by adding versions in traditional forms."  But print is somewhat of an odd partner for a technologically oriented brand, one that already has its own You Tube channel.  Would it have made more sense to build out a tablet magazine model?  Its choice of outlets for magazine distribution, including Target, Walmart, and Costco, may indicate its desire to get the CNET name more known across Middle America.  Brand awareness drives more attention then back to its website.

The move to the magazine though is built on synergy.  The inaugural Winter 2014 cover includes LL Cool J, star of the CBS drama NCIS: Los Angeles.  With a first issue circulation of 200,000, the financial risk may also be minimal; the reward more impactful given the number of stories being written just as the issue hits the stands.   Food Network and HGTV have found relative success with their respective magazine brands and with the departure of the Macworld magazine, there may just be room for the CNET magazine to thrive.  So hail to the multi-platform strategy; the more available you are, the easier it may be to grow.   

Friday, October 31, 2014

Scripps Pushes Branded Content Across Its Networks

Its hard to know if viewers are watching commercials that invade their shows and movies.  Those two minute or longer breaks are the perfect time to switch the channel, go to the bathroom, look away from the TV to a tablet or smartphone, and other distractions to avoid watching those dreaded ads.  But make the advertising part of the show without hurting the credibility or momentum of the plot, and it becomes a very compelling win-win outcome.  Branded content, native advertising, and sponsorship done well can work great; done poorly, it is one long ad.

It seems that Scripps has found a terrific content sponsorship opportunity to coincide with Veterans Day.  Per today's NY Times, Scripps "is preparing an hourlong special — centered on the celebration of the Hawaiian homecoming of a wounded serviceman — that is to run on all six of its cable channels and be sponsored by major marketers like ConAgra Foods, Liberty Mutual Insurance and Union Pacific." As an indication of production integration into the format of the program, "There is a glimpse during the trailer of a scene from the special in which members of the military are served food bearing logos of a ConAgra brand, Marie Callender’s, that became the presenting sponsor of 'A Hero’s Welcome' as part of a cause-marketing initiative, the Comforts From Home Project, which benefits the U.S.O. and the USO2GO program."

A great cause, a great partner, and a great commitment to an important segment of our population.  Most important, it seems that the use of the product does not overwhelm the core element of the show.  This content sponsorship and promotion nicely extends across all of Scripps' available platforms.  Using its media synergy, ads are also being placed on its two magazine brands.  Hopefully, interest in the programming will translate to viewership and more branded content opportunities will emerge.

Thursday, October 30, 2014

Amazon Still Pursuing Hardware At Their Own Peril

Last Friday, I wrote about Amazon's identity problem with their hands in too many places and their financial results deemed disappointing.  They have clearly embarked on a strategy of forsaking short term results for long term opportunities.  And they continue to invest across the board, sometimes at the risk of losing money. 

Hardware products continue to attract the attention of CEO Jeff Bezos.  According to the NY Times, "Amazon now looks to be preparing a full-scale ground invasion of the rest of the gadget landscape. In addition to a new Kindle reader, this year the company entered two new device categories, and it expanded the rest of its hardware lineup."   Their latest release is the Fire TV Stick, a Chromecast-like device to distribute OTT content on your TV.  At the same time, they are updating their Kindle e-reader and tablets.  Unfortunately, their attempt to get market share in the competitive mobile phone arena has failed.  Again from the NY Times, "Amazon disclosed last week that it was sitting on $83 million in unsold Fire Phones, and would be taking a $170 million write-down on that program."  With Apple and Samsung releasing larger mobile phones, many see cannibalization of  the tablet market. In fact, while Apple iPad sales slow, their iMac sales have grown. 

Is hardware the right business for Amazon; The e-reader market helped them to drive e-book sales.  But in the world of tablets, smartphones, and OTT, Amazon may not be so lucky.  Their strength as an e-commerce retailer might be better suited working with the Apple's Samsung, and Google, not competing against them. 

Wednesday, October 29, 2014

Digital Driving NFL Offenses, but Penalties Are Key

A terrific read in today's Wall Street Journal on technology's effect on NFL offense playmaking.  Where the sidelines once relied on photographic print outs to make their way down to the field, they now have tablets, courtesy of a Microsoft sponsorship putting their Surface tablets on the sidelines.  Instantaneously, players can see not only images of the last play but actual footage as well.  For the offense, it seems to have had an effect on yardage and scores. 

And according to the article, it has been a boost mainly to the NFL offense.  While tablets have been on the field for four years, according to the report, somehow this year is different.  I'm not sure that I believe that having this access favors the offense.   The defensive side of the ball gets the same information and can make similar adjustments.  As a fan of the NFL, I believe that it is the rule changes that have had a bigger effect on playmaking then tablets on the sideline.  New rules on defensive holding and illegal contact give a big advantage to offenses.  Penalties can enable offenses to get a fresh set of downs.  The NFL recognizes that more points on the scoreboard tends to make games more exciting, resulting in more viewership and fan interest.  With more penalties being called on the defense, the offense has more success. 

Yes, the technological changes have helped the offense, but they are there to help the defense too. Is it giving the offense an unfair advantage.  I'm not so sure. 

Tuesday, October 28, 2014

Layoffs Abound Across Cable Networks

Mergers across cable operators, the fear of cord cutting, and disruptive changes in distribution and content are driving a rise in layoffs in the cable industry.  This summer, we heard of layoffs at Fox and Al Jazeera America, last month it was CNN, Cartoon, TNT and Scripps (HGTV, Food), last week it was AMC Networks ( home of AMC, IFC, WE and Sundance), and today it is HBO.  Not surprising in that both CNN and HBO are part of the Time Warner and Turner conglomerate.  With layoffs hitting 10% of total staff, it is clear that consolidation and disruption in the cable and media industry are affecting the size of the workforce. 

It doesn't take a fortune teller to recognize that more layoffs will come in this fourth quarter.  The announcement that AMC has bought a 49.9% stake in BBC America with plans to run that cable network will likely come with additional layoffs too.  NBC and Disney saw their share of layoffs last year but could see more in the future.  This is not a knock on any of these companies; the industry has followed the classic life cycle curve and as it matures, less growth means less labor.  This change is inevitable but the hope is that from disruption springs new job opportunities for all. 

Monday, October 27, 2014

DVR Fails For SNL, While Yahoo! Screen Delivers

Our cable dvr is set to automatically record certain programs, but doesn't always succeed.  In most cases, it cuts off programs before they end and every now and then fails to record at all.  Such was the case when I turned to the dvr on Sunday to catch up on last night's Saturday Night Live only to find that it didn't record.  I looked through the history but it failed as well to tell me what went wrong.  And going to our cable's on demand function was no better as the SNL episode was not immediately accessible.  But thanks to streaming, I had another option.

Opening up the iPad, I clicked on Yahoo! Screen and there was every skit and all the musical performances from the show.  And while You Tube carries certain clips from the show, it doesn't show it all.  The best part watching was that I did not have to endure one commercial to watch; the worst part was that buffering created certain delays that forced refreshing in order to watch.  Once each clip played, I was shown a short promo to watch SNL on NBC  and then the next clip would automatically start to play.  Yahoo! Screen proved to be a great solution to a cable dvr catastrophe. 


Saturday, October 25, 2014

iTunes Adapts To Meet Changing Demands

With Apple's quarterly financial news, most attention was paid to iPhones and iPads, but Apple also finds revenue from its iTunes business. According to the Wall Street Journal, "global iTunes sales—including movies, apps and books—increased to $4.6 billion in the third quarter, up from $4.3 billion in the same quarter a year ago."  Revenue is up despite the fact that music downloads are declining.  Consumers no longer feel as much a need to own when they can enjoy listening via streaming services.  Pandora and Spotify have become big winners as a result.

But Apple was not blind to this change in consumer purchase habits.  earlier this year, they purchased Beats and with the headphone business came a streaming business as well.  How they fe=it Beats into the Apple iTunes infrastructure remains to be seen, but they clearly recognized that a change was needed.  Still iTunes revenue has grown year over year and that is because the iTunes business is more than music.  It encompasses video, books, and apps too.  With the release of Apple Watch, more apps will be sold to run that product line.  And iTunes may also be the home for Apple Pay and the rise of other e-commerce type businesses. iTunes continues to face changing consumer interests while it continues to be the online store its products need for application and content consumption.  And iTunes revenue, already the size of some other Fortune 1000 companies, should only continue to rise. 


Friday, October 24, 2014

Is Amazon Trying To Do Too Much?

Amazon released its quarterly earnings yesterday and the results were poor.  Expectations have been high for the company, but revenue growth was low and losses are adding up.  On the financial front, troubling signs remain.  So what is the problem?

From an outsider prospective, Amazon may simply have an identity problem. Their success as an e-commerce and retail disruptor continues to propel them, but at low profit margins.  But they have ventured outside their e-commerce world as a technology/consumer electronics company (Kindle e-readers, Fire tablets and smartphones), a content creation company (Audible, Amazon Studios), and a content distribution company (streaming via Amazon Prime).  They have acquired numerous companies and have grown both domestically and internationally.  But in their race for both breadth and depth, Amazon may have been unable to focus on a few particular businesses as their attention is forced to take a more wide-angle view.  is it time to simplify?

Such a strategic move is not unique.  Microsoft is going through such a re-focus now with an eye centered on more cloud-based businesses.  Netflix pulled away from the dvd business to concentrate more fully on streaming.  Amazon remains an amazing online business that has helped consumers to find and receive almost any good they need from around the world.  But should phones and tablet be also a part of their DNA?  The content creation and distribution game is a lucrative one as any studio or network will tell you; one year you have the must-see show or movie, the next year, you have miscalculated and lose millions on bad picks. 

According to the NY Times, "Amazon’s story for several years has been that it is growing furiously, investing heavily and postponing profits until the halcyon days just around the corner when it will sell all things to all people all the time."  But always waiting for tomorrow is not necessarily a good thing.  It must be mixed with a live for today mentality; otherwise, one moment it is in front of us and the next it is behind us and we never had the chance to be in that moment. 

Unlike brick and mortar companies like Sears and Barnes and Noble, Amazon has more good days ahead of it.  Their quarterly results are a wake-up call, but they have the right assets to continue to prosper moving ahead.  My advice is to simplify and streamline to focus on doing what is most important.  As Jim Collins refers to in his book, Good To Great, have a hedgehog approach to doing a few key things well and get everyone on that bus to strive for greatness.

Thursday, October 23, 2014

FCC Puts Cable Mergers On Hold, But Should Approve Them

The FCC review of the Comcast - Time Warner Cable and AT&T - DirecTv mergers has been temporarily suspended.  According to Reuters, "The FCC, which will determine whether the deals are in the public interest, said it will pause its self-imposed, 180-day shot-clock deadline to decide how to handle highly confidential documents related to agreements with media companies." Content companies simply don't want to make public who gets charged what for their networks.  

Simply put, the cost that Disney or Discovery or Scripps or any other network charges for each of their networks will be less for an operator the size of Comcast then for an operator the size of Cablevision.  It is one of the dirty little secrets of contract negotiation.  Larger operators get charged less per subscriber because on the aggregate level, they pay a large total sum for all their subscribers.  The larger their reach, the better the deal they can negotiate.  And monthly costs for cable programming can get expensive as operators multiply it by all the channels they bundle to consumers.  It is why their is the latest contract fight between Turner and Dish.

At some point, the clock on these mergers will resume and the FCC will be asked to approve or disapprove each respective merger.  Ultimately, both efforts should be approved.  Size efficiencies are necessary to assure blanket coverage of cable and broadband across the country.  Disruptive technology assures that content companies can reach consumers outside the cable paradigm.  Netflix, Hulu, Amazon, and even CBS and HBO GO are great examples.  I believe these mergers actually improve the competitive front in the cable/broadband space with fewer, although more powerful competitors.  Will prices rise; they always do.  But the cable industry is simply following the industry life cycle curve that many other industries also face.  As they mature, the number of companies competing become fewer, yet bigger.  Look no further than industries like Airlines, Oil, and even Media.  It is the norm.  What is also true is that disruptive changes always occur that lead to new businesses and new competitors.  And that is what makes our free economy work. 


Wednesday, October 22, 2014

Dish And Turner Engage In Latest Channel Drops

Another expired contract, another drop of channels until negotiations are resolved.  Today, the battle is between Dish Network and the Turner Channels, including CNN, Cartoon, and TCM.  Excluded in this particular negotiation are TBS and TNT.  And the loser at the moment are Dish customers who love these channels.  As I have said before, this chess game strategy of dropping channels to incite pressure has become part of the playbook between operator and network. 

Will customers drop their Dish subscription?  They might, but the next cable operator they sign up with will eventually go through a similar battle.  Just ask Time Warner Cable when it dropped CBS last year.  CBS may have learned some lessons from that last negotiation.  With its announcement of a streaming linear and on demand service, CBS can offer customers an alternative viewing choice.  Turner may feel a bit of a sting from the loss of 14 million customers from Dish.  Whether it is a long or short term drop, Turner might do well following the CBS model to build out a streaming platform of its own.

At the end, these streaming a la carte channels may solve some of these drop issues.  Customers who try to buy multiple a la carte services will only begin to recognize that the bundled cost of services provides a better value for a large number of channels.    Only when we care about a select few number of streaming subscription channels is a la carte the cheaper choice. 

Tuesday, October 21, 2014

Cable Nevers And Cord Cutters Aren't The Same Thing

As cable subscriptions drop, many cite the rising niche of cord cutters as the cause.  They are households who once had a cable subscription that decide to drop their service, likely for a broadband only video world.  Cord cutters may be motivated to their action due to the rising costs of TV programming that gets passed on to the consumer by price hikes.  The rise of streaming services like the new CBS streaming app and HBO GO to offer non-cable streaming access to its content is seen as a way to recapture these cord cutters.  But perhaps they are not the only non cable groups.

Cable Nevers, or households that have never had a cable subscription, may also be on the rise.  They are the next generation of home or apartment owners, fresh out of school, or on limited budgets, that determine that a broadband connection is more valuable to them then a cable subscription.  Under a household controlled by their parents, they enjoyed the fruits of cable, but on their own, they beg, borrow and steal to get access.  Some stay connected to their parents Netflix account, or their authenticated HBO GO subscription or perhaps an Amazon Prime account and some may connect to a Slingbox from a friend or family.  At the same time they enjoy access to a ton of free content from You Tube, Hulu, Crackle, and more.  And when they must watch a linear show, a local bar might just offer a game or two.

The threat of high costs of cable subscriptions may not be that current subscribers will cut the cord; we may be too addicted to give up on all that content.  The real worry is that the next generation of households will start their homes without a cable connection.  On limited budgets, their video entertainment will come from OTT connections and Cable Nevers they will remain.

Monday, October 20, 2014

CBS Streaming Service Already Available

While HBO announced its unbundled streaming service, it is not available; CBS not only announced but it is already available for purchase at this website.  At $5.99, consumers can access both the live stream from their affiliate and a large library of on demand TV shows, from I Love Lucy and Twilight Zone to NCIS and The Good Wife.  And while the NFL won't be available, some live sporting events and other live events will be made accessible on the streaming app. 

For cord cutters wishing to still get TV programming, it might be a good deal.  But take the CBS model and watch it get copied by other broadcasters and cable nets, and the costs to subscribe to multiple channels quickly rise.  Buy 10 streaming channels at $60 or 60+ cable channels from your cable operator for $60.  Still, happy with access to a few channels will certainly make a subscription to CBS a cheaper deal.

There is one other advantage that the CBS streaming model offers.  When broadcaster and cable operator get into a license fee battle and their channel is removed from a cable line-up once the contract expires, CBS can now promote their CBS app to access their channel and not promote switching to another cable provider.  It may not be a perfect short term solution, but it is certainly an elegant one. 

Friday, October 17, 2014

Online A La Carte Could Make Cable Subscriptions A Better Deal

Bundling, in the cable vernacular, has been seen by consumers as a bit of a dirty word.  Forced to take a number of channels that they would never watch, consumers heard the pitch that they would get better value for all its accessible networks.  Bundling applied to the services received as well; the Triple Play enabled consumers to purchase cable, broadband, and phone for one low price, getting discounts for being a multi-platform customer.  But as the costs for cable keeping inching up, customers have felt that a la carte would get them a lower price for only the services they truly wanted.

With threats of cord cutting and cable nevers, broadcast and cable channels are finally opening the door to a la carte subscription models.  HBO announced plans to offer their HBO GO digital subscription to non-cable customers and now CBS has announced their plans to offer a stand-alone digital content platform outside the cable spectrum.  Their hope, and that of others, like Univision, is that incremental revenue growth can be found in the digital subscription model.  Plus, it protects and competes on the same web platform with current online rivals like Netflix, Hulu, You Tube, and Amazon Prime.  Will CBS or Univision offer these digital services as added extras to authenticated cable customers like HBO offers with HBO GO?  The allure of an added revenue stream might just prevent them. 

Current cable subscribers might be encouraged by such content availability online and consider finally cutting their cable cord.  Those tired of paying exorbitant fees for their cable subscription could now get just what they want for less.  Or can they?  Online content usage shows that consumers have an insatiable appetite for video.  We keep searching for more and more to watch.  And as we sign up for more of these online services, the costs add up to the tipping point where a cable bundle just might start to become a better content deal.  And consumers that opt out of their cable subscription may start to see their Triple Play discounts evaporate.  They will pay more for broadband only service from cable, and even more to up the speed for download, as cable operators keep raising their prices. 

Cable operators are certainly hoping that cord cutting will be minimal.  Because consumers' demand for online content is growing, operators hope that subscribers will buy cable AND buy these monthly online digital services. And that might encourage networks to shift programming off on demand and onto their paid subscription models.  A la carte might just win the day but consumers will find that they are not only paying more but receiving less content as a result of cutting the cord. 

Thursday, October 16, 2014

Could Cellphone Beacons Ruin Our Lives

As humans, we follow Pavlovian tendencies.  And with our mobile phones, it seems that every buzz or ring causes us to quickly stop what we do to look at our phones.  In some cases we even look at our phones when it is someone else's phone that is ringing.  But the worse problem is when we look down at our phone and end up tripping or running into something.  Embarrassing when we are walking, deadly when we are driving.

So the NY Times article on beacons may at first seem promising, it poses problems too.  "Beacons, tiny low-powered radio transmitters that send signals to phones just feet away, have quickly become a new front in the advertising industry’s chase to find you whenever, and exactly wherever, you are."  In a store, they can alert you to coupons and specials, notify you to new information, offer rewards, and other one-on-one engagements.  But they also cause us to look down at our phones and not around us in the space we are occupying.  We may think we can be good multi-taskers, but we end up not seeing what may be right in front of us. 

In some cases, beacons can create some unique opportunities; but, overused can become a big problem.  Used properly, "They could enrich museum experiences, deliver the right recipe in the grocery store aisle, take us on interactive tours of cities and towns, let us quickly and easily check in to hotels or even pay at the gas pump."  Misused and we will walk into other people, crash into a  cart, trip and fall, or simply be so busy looking down that we fail to see the world we are living in.  Unfortunately, I doubt that restraint will be used and we will need to become even more careful as we navigate around so many people looking down at their cell phones.

Wednesday, October 15, 2014

HBO GOes Without Cable

HBO just announced that in 2015 it will start to offer the HBO GO digital content, without a cable subscription.  While there are limited details, HBO has clearly been feeling the heat from Netflix, Hulu, Amazon and others.  And while HBO cable subscriptions continues to deliver valuable revenue, the threat of cord cutting can damage their leadership position.

I wouldn't be surprised to learn that HBO offered some deals with their current cable providers to move in this direction.  Such alternatives might have included revenue guarantees against current customers that might drop HBO cable for HBO GO.  I believe that HBO's research would indicate that they won't experience this shift in viewing.  I suspect that current cable/HBO subscribers will maintain their subscriptions and HBO GO being offered directly to consumers will actually result in more additive growth than shifting of platforms. 

There is certainly a risk that this move by HBO to offer HBO GO and the likely repercussions of other premium services like Showtime and Starz developing a similar move, will ultimately lead to greater cord cutting.  It may also lead to cable companies pursuing more a la carte offerings to deliver a lower priced set of networks for consumers still seeking a cable platform.  At the same time, cable companies must also push for a complete TV Everywhere experience that lets every linear and on demand channel to be accessible via authenticated viewership to its customers.  Till then, this move by HBO is a necessary one to stay competitive against its digital rivals.