Wednesday, August 31, 2016

Apple Event September 7

Next Thursday, just 8 days from today, Apple will once again try to dazzle us with its next set of upgrades.  Just in time to have on the shelves for the Holiday Season, many expect the next iteration of the iPhone, as well as upgrades to its Apple Watch and mac computers.  Upgrades yes, a new product launch no.

Given the rumor mill that always precedes these events, none have included or hinted at a new product release.  No Amazon Echo clone, no Apple car, no Apple TV set.  No buzz means that we can expect to simply here how each product has been tweaked to encourage us to upgrade our own devices.  And don't expect that Apple announces plans to acquire any content companies.  As much as we would love to hear them make a play for Scripps or CBS or Netflix, that is also an unlikely scenario for the event on Thursday. 

Be careful though if you do decide to upgrade your iPhone when it comes out.  You may find that it no longer syncs with your older mac and iTunes program.  That means you can't back up on a computer and must do it online.  And cloud backups will cost you.  The more memory you use on the iPhone or iPad, the more storage it may cost you.  Given the need for more icloud storage, expect too that Apple will announce new service plans to support you and your family's devices.

It has been rumored that the iPhone 7 may no longer have a separate headphone jack.  All connections are made through the lightening adaptor or via bluetooth.  As to those folks that have a Beats Headset, now owned by Apple, you will have to decide whether to buy a new bluetooth headset or stick with your old iPhone.  For Apple, Beats was all about the music subscription service and not the products.

So get revved up for next Thursday.  Always fun to watch the announcement and see how the stock market immediately reacts to it.  Enjoy!

Tuesday, August 30, 2016

Does Moonves Have Say In Merging With Viacom

When Sumner Redstone decided to split his empire into two media companies, CBS and Viacom, the initial thought was likely that broadcast was holding back the cable side of the business.  But fast forward ten years and Les Moonves was able to take his portion, CBS Inc., and watch it grow and prosper while the cable arm called Viacom has not.  Can synergy now save Viacom?

Well, now that Shari Redstone, daughter of Sumner, has gotten control, many believe that her next is to merge the companies together.  Viacom certainly needs the help and perhaps an overhaul of talent making the current strategic decisions.  Paramount has lost its mojo, and the cable nets are no longer relevant.  Need proof, just watch the recent MTV VMA music awards.  Not many tuned in from last year and the numbers had a major decline.  It was a performance show, not an awards show, and the performances overall were meh.  Yes to spectacle, no to real singing.  Most seemed to be karaoke and less live. 

And while merging CBS and Viacom makes sense, it also requires the buy-in of CBS CEO Leslie Moonves.  If he is not onboard, then the odds against a positive synergistic combination seems low.  I suspect if Moonves had his say, he would buy just Paramount and sell off the cable nets.  Unfortunately, he may not have a choice and Redstone may force him to it.  As to his power to push back or leave if his back is against the wall.  That may also be an option. 

Friday, August 26, 2016

CBS's Newest Revenue Stream

The rise of streaming, the challenge to increase ad revenue as well as licensing of its network to cable companies all play into the strategic mix as CBS seeks revenue growth.  Certainly content matters and quality shows that generate buzz hope to find audiences that stay loyal to their plots.  And building new distribution outlets to grow as a business remain relevant.

In the case of CBS, they chose not to be a partner in the Hulu streaming business.  The other three broadcasters NBC, ABC, and Fox, and now Time Warner have ownership shares in the Hulu business.  Instead, CBS is trying something new, its own streaming subscription service called CBS All Access.  For a $5.99 monthly fee, subscribers get "more than 7,500 on-demand episodes from the current season and previous seasons of classic shows, as well as the ability to stream local CBS stations live in more than 150 markets across the U.S." according to Multichannel News.  And following the learning curve of other streaming services like Amazon and Netflix, CBS All Access will offer original productions too, "including Star Trek: Discovery, a spin-off of The Good Wife and a new digital edition of Big Brother."

The question this strategy hopes to answer, is it better to build a new service or partner with an existing one.  Is there enough content of interest to subscribers to entice them to join?  Can marketing sell the value of adding another streaming service charge to the entertainment household budget?  CBS is trying to make it easy to access its streaming service with Roku, Apple TV, Chromecast, XBox, Amazon Fire TV and more.  Accessibility does not seem to be a problem.

But I wonder if going it alone and not with Hulu, CBS studied whether a brand name associated with the broadcast network or one without a connection made more sense.  Will customers more likely embrace the subscription service because of the CBS name or feel that they should be getting this content already if they are current cable subscribers with on demand.  Would it have better suited the service to create a more unique name like Carousel or Tainment or StreamCity to compete in the streaming media landscape?  Was CBS All Access a better name choice to drive subscription revenue?  We will watch and see. 

Thursday, August 25, 2016

What Will Viacom Do With Paramount

If you haven't guessed after reading my blogs, I am a huge fan of content.  But content does not live in a vacuum and the yin and yang between content and distribution, adding a dash of marketing to the mix, makes the difference between success and failure.  Good content can help distribution and good distribution can help bad content; ideally, great content, easily discoverable and accessed matters.

So today we have Viacom, a media company with an ailing CEO, infighting of the relatives, a changing board, and other leadership issues struggling to fix all the wholes, from falling ratings at their cable networks to poor movie making choices at Paramount.  Its latest box office dud being Ben Hur with very little box office hits to mention.  What should Viacom do with Paramount, where once The Godfather, Indiana Jones, and Titanic all were released?

There has been some speculation that Viacom should sell some if not all its ownership in Paramount.  But I love content and believe it is the driver to growth for Viacom.  I believe selling makes little sense unless the plan is to give up and sell all of Viacom.  Paramount, with the right talent on board, can make great content again.  And great movies are currency to be sold over and over again across different distribution windows. 

But what is in the pipeline of future Paramount releases following the awful Ben Hur film starts to question the internal leadership and the choices they are making.  October is the release of the next Jack Reacher with Tom Cruise, a possible hit, but they are also banking on a number of other sequels including Transformer, Friday the 13th, and Terminator.  What happened to originality?  Even their latest release of Star Trek Beyond felt like an overly long TV plot rehash.  If there is change to make at Paramount's film unit, it starts at the top.

As to their TV department, Paramount also produced Grease: Live,  Criminal Mind, NCIS, and others.  And hopefully they will have more upcoming hits to mention.  With so much demand for TV content in the streaming world from Netflix, Hulu, and Amazon, Paramount should have no problem finding homes for their product, as long as the quality is there.  Like my concern with movies, rehashing old series and classic movies at the expense of originality does not seem like the best route to take. 

So what should Viacom do with Paramount?  I say keep it.  If your plan is to sell Viacom, it is more valuable as part of a bigger deal.  if the plan is to reinvigorate Viacom, Paramount is a perfect complement to their media empire. 

Tuesday, August 23, 2016

The Profit In Data - Storing And Streaming

I'm struck by an epiphany as I watch how much data I continue to acquire.  I don't mean bookshelves or albums or DVDs; they get less filled as my books, my music, my photos, my videos, my life are all now bits and bytes of data.  And I see too that the cost to store and stream continues to grow as I accumulate more stuff. 

Already, I have on my computer over 15,000 photos, the more recent ones requiring more memory than the ones taken in 2000.  My iTunes account includes more and more downloaded books, music, and videos and my computer's memory is nearly at capacity.  My Carbonite account helps safeguard these digital assets, at a cost, as I sense that I will need a new computer with more memory in the not too distant future.  And Apple is gracious enough (lol) to sell me more cloud backup space for my iPhone and iPad.  The costs to store will only continue to rise.

And then there are the costs to stream data.  Subscription fees from folks like Netflix, Hulu, and Amazon, help drive up the monthly costs.  One's love of music means monthly subscription plans from Pandora, Spotify, and Apple Music.  We no longer need to own when we can rent and stream as much as we want.  But the costs to access also extend to the companies that sell us data plans to receive these streaming signals.  The more we stream, the more we consume, the more data services we buy.  Of course, the speed to receive these streams can also come with a higher cost; the faster the stream, the more we pay. 

As we move further and further from physical media to digital media, the cost to access data, stream it, and receive it will only increase.  And the profits will only grow.  Data is our new gold and we are mining it at an ever increasing pace.  It is the business to be in. 

Monday, August 22, 2016

Viacom's Future

Did Sumner Redstone win back his own company?  Was former CEO Philippe Dauman not following the directions of its top shareholder?  Does the 93 year old billionaire know or even care what is going on?  And does forcing Dauman out give either Sumner or daughter Shari back the control they need?  Too many questions as we watch a company wrestle with under performing cable networks and a movie studio shooting blanks, including its latest release of the reboot of Ben Hur.  Is it possible to right this ship?

Of the many questions being asked, many wonder if this means that Viacom will combine with CBS again into one company.  Many believe that it is CBS and its CEO Les Moonves that want to stay clear of this merger although Redstone may have different plans.  The other more immediate question is whether to sell off pieces, especially Paramount, an idea said to be pushed by Dauman.  And then there is the more nuts and bolts questions surrounding each of their cable networks that require more hands on work to regroup and regrow.  Each channel, MTV, VH1, Comedy Central have lost sight of the adage that what gets you to the top doesn't keep you there.  Tastes, shows, hosts, technology, etc. all continue to change and networks need to constantly adapt to remain valuable to the cable line-up.  There is a lot to fix at these nets.

Certainly the leadership fighting at the top of Viacom may have led to a loss of focus at each business.  With that issue finally handled, the focus can be put back onto each business unit.  First things first, morale must be improved with all employees knowing that no jobs are at risk and that they are safe to suggest, challenge, confirm, and execute on strategic plans.  Innovation, experimentation, thinking out of the box, and staying open to new can possibly help Viacom re-emerge as an important media player.  Or it will all be merged with CBS and become another leader's problem. 

Friday, August 12, 2016

Cord Cutting Less Of A Worry

A CNBC story tells us that research from SNL Kagan indicates that "a flattening pace of cord-cutting and a projected broadband boost of 8 million subscribers over the next 10 years, media companies are quickly shifting the way their content gets delivered to consumers."  Truth is, the best way to stream is with broadband.  The cost of data from cellular, mainly because of plans that charge by the gigabyte, makes an impact on the household.  Households may not be buying higher packages of cable, but they are still getting the basic cable package and bundling broadband.  With a broadband package, consumers have wireless accessibility for tablets and smartphones.  And they get authenticated access to wireless outside the home.  In the Northeast Xfinity, Optimum, Time Warner Cable and others have been building out their wireless platforms to support their subscribers. 

Consumers have been moving toward streaming as a preferred way to view content.  Streaming both cable and OTT content to watch on all their devices.  NBC has just announced that they have already served over 1 billion streams of Olympic content.  Time Warner Inc. made a big investment in Hulu, a streaming subscription service.  And Disney/ESPN are finally looking at a streaming subscription package for their sports content. 

The success of broadband enables cable companies to drive bundling packages in a way to keep households connected to cable TV as they drive broadband subscription growth.  And per the report, the strategy has kept cord cutting from becoming a bigger issue.

Huffington Leaving Post

On the surface, the news that Arianna Huffington is leaving the company that she founded and runs to start up a new venture doesn't sound that concerning.  Entrepreneurs enjoy the thrill of the start up.  And with an acquisition of The Huffington Post, first by AOL and then again as Verizon bought AOL, the notion of being the big fish in a small pond gets lost as the pond becomes an ocean and you become a smaller fish relative to the size. 

That Huffington is leaving to start a new venture called Thrive, a health and wellness digital site, does raise a couple questions.  One, that Verizon has also just bought Yahoo and Huffington could take the health assets from this acquisition to mold her site as a venture inside of Verizon.  Two, that digital health and wellness sites are already plentiful and no site has yet truly broken through.  I myself have worked for a couple cable health and wellness sites, including Veria and HealthiNation, and attracting a sizable audience, either on TV or on the web, has been extremely difficult.  Given all the niches, health and wellness seems to best occupy the longer tail part of viewing patterns.  And third, that Huffington's new venture might have had a better distribution shot staying inside Verizon than operating independently.

So the smell taste fails me when it comes to her motivation to leave.  The only argument is that she simply wants to be more independent and occupy the leadership chair in a much smaller business entity.  Financial motivation may simply not be an issue for her at this time.  While I wish her luck with her health and wellness venture, her best outcome for it will be its future acquisition with another site. 

Thursday, August 11, 2016

Will Content Glut Reach A Tipping Point?

The rise of digital distribution has created an insatiable thirst for more content to fill the bucket.  Video content is being produced not just for broadcast or cable, but for streaming services as well.  We are seeing the numbers rise for both short form content, user generated content, and scripted series as well.  And as Investopedia tells us, "John Landgraf said the number of scripted television shows next year could reach 500, from an estimated number between 430 and 450 this year, driven mainly by a rise in shows commissioned by streaming services." Landgraf, CEO of FX Network, places responsibility on the streaming media services like Netflix and Amazon.  But Hulu, of which Fox Networks are an owner, could also be named as well.

The challenges of producing so much content include finding quality programs amid the morass of choice, viewers finding the needle in a haystack of endless content possibilities, and measuring success in today's overly saturated content world.  With so much content choice possible to see and hear, focus becomes close to impossible and harder even to search for and find.  With such a glut of content, it becomes even more important for us to use recommendation, marketing, and advanced search to help users find a match to content they would enjoy viewing.

The drive to create content is only advancing.  In coming years, the numbers will only increase.  Today, in fact, Turner announced an investment in Refinery29, a female skewed destination for fashion and entertainment, and one in which Scripps is also an investor, to support more content that could possibly make its way onto their channels.  Content is the fuel that runs digital media distribution.  Consumer thirst for more helps to drive subscription and cable revenue streams.  And with advertising alongside it in some way, deliver more profit to media companies.  Have we reached a tipping point?  Probably not, although the challenge for creative minds is to make the content produced quality worth watching. 

Tuesday, August 9, 2016

Comcast Says Future Of TV Is X1

Great read in Business Insider called  "How the battle for TV's future could take over your whole house".  Matt Strauss, EVP of Comcast Video Services, sees TV evolving in a new way.  The TV continues to be the centerpiece of the house and that smarter features out of the X1 cable box offers the user more control.  "X1 is a cross between an advanced TV guide and a virtual assistant, and Comcast thinks it will compete with the likes of Amazon's Alexa-powered Echo and Apple's Siri-powered Apple TV."  With a touch of the microphone button on the remote, the X1 box can find channels, shows, answer simple questions, and possibly more.

Strauss believes that the X1 box can be the "hub" for which the home can likely get smarter.  As we tend to have TVs in almost every room, attaching an X1 box to each TV that all communicate up to the cloud and share back info, creates a unified smart home experience.  And while we may not always want the TV screen to be on, the X1 box is always on.  That opens itself up to a larger future.

From my own experience with X1 so far, I see the potential.  The next generation of boxes will need to work on voice command without remote button push, like the Amazon Echo.  One could say, "X1, what is the weather today",  just as we ask Alexa.  It could potentially then answer back rather than put answer on screen.  Than we could say, "X1 turn TV on or off", again without a remote button push.  The future possibilities are endless.  Perhaps a partnership for Comcast and Apple Siri to explore.

As to the Comcast plan, As Business Insider suggests, "So for Comcast, winning the future of TV could mean winning the entire house in the process."  I agree.

Facebook To Stop Ad Blockers From Working

As much as we all seem to hate ads, they are the lifeblood, the revenue, that drives the growth off many media businesses.  But too many, too cluttered, too irrelevant, and they make the experience of watching or reading content less enjoyable.  In the digital world, ads also tend to slow down the streaming process, as they attempt to figure out which ad to present and run on site.  As a result, many users have installed ad blockers to quicken the web load refresh process and let users enjoy only the content. 

Facebook says they have figured out how to "block the blockers" to help them assure that ads are seen and their revenue grows.  But in an attempt to aid the user, Facebook is also offering more control on what ads to see and what ads to hide.  How much more control remains to be seen and whether it is more useful to the viewing experience. 

While some use ad blockers to improve the page load, others use ad blockers to improve personal privacy and protection from possible malware.  Many want to be anonymous in their viewing process and do not want to be tracked.  While my biggest gripe is how ads slow down the page from loading, I also believe that a number of the ads presented are simply not relevant to me.  That Facebook wants to improve that experience is helpful, but more importantly, they need to improve the load refresh of the page. 

Monday, August 8, 2016

Walmart Buys To Catch Up To Amazon

Today, Walmart announced that they are indeed buying Amazon competitor  Likely to close by end of year, the rationale to purchase seems obvious, play catch up to Amazon. But to make it work, the strategy will require a visible way to make the physical stores and online presence a bigger, better, more enticing experience than what Amazon already offers.  Not an easy task.

According to the NY Times, "Under the deal, Walmart and Jet will continue to operate as distinct brands."  Walmart believes initially, they will have leverage to price their products lower and yet still profit.  But as Amazon demostrates, it is more than just lower prices.  Convenience, delivery, a wide range of products and services from many vendors, plus the Prime business of cheaper delivery and streaming content truly helps the Amazon brand.

Walmart and, operating independently may not be an ideal fit.  Finding the synergistic elements as well as the marketing approach that clearly shows the benefits to the end user are essential.  That will take a lot of work.  Done well, it could make them a venerable competitor.  It could also draw in other brick and mortar retail operations to build out their own delivery operations as well.  We see it already with supermarket chains offering home delivery services.  And department stores seem willing to ship for free merchandise not already available in store for pickup to the home.  So for Walmart, must do something more to take away Amazon market share. 

Once the acquisition closes, it will be fascinating to see how good a fit the two brands can make.  But the real win will be if it adds value to the operation and delivers results that exists today.  Retail is a tough world, operating on thin margins.  Walmart and Jet must see that this merger is a good move for both. 

Friday, August 5, 2016

I Upgraded My Comcast Cable Box

As much as we would love all our devices to work without extra boxes on top, the added features and benefits that a cable boc can bring might just offset working directly from a smart TV.  Of course, that depends on the frequency in which devices automatically upgrade and improve their features and benefits.

For now, my TV viewing requires a cable box to watch cable programming, a DVD to watch certain videos, and a Google Chromecast to stream Netflix and other videos.  I have yet to add the Apple TV, waiting either for a better price or some wow feature to make me want to buy it.

I did upgrade my Comcast cable DVR box to the new X1.  I like the added memory by storing DVR content in the cloud and I like the ease of recording and search.  And mostly, I like the voice control on the remote to access and switch channels.  Just press the button and say NBC and the box switches the channel.  Say the name of a show and it will find it for recording.  Overall, I am happy with the upgrade.

But there is still work to be done to improve the X1 more. There is still a long latency switching channels and certain features are cumbersome to access.  I wouldn't mind a quicker way to delete a watched show and an undo button if you accidentally erased something (although it may be possible to recover a deleted program).  The TV Guide is not as clean as it could be nor easy to navigate smoothly.  And the remote still has too many buttons that can make finding the right one to hit a chore.  Still, the voice feature is a real winner and one that makes me glad to have upgraded. 

Thursday, August 4, 2016

Who Wants MTV?

Viacom was part of the birth of cable networks.  It created MTV and its first music video was from the Buggles, "Video Killed the Radio Star".  Many have worried that digital streaming has done the same to cable.   Radio has survived but has certainly changed if not weakened.  IHeartRadio, a major radio player faces the prospect of bankruptcy.  But back to MTV and the question on everyone's mind, do people still want their MTV? (Sorry Dire Straits).

Can MTV and its owner Viacom keep their eye on the business while facing so much scrutiny around the competency of its founder and controlling owner, Sumner Redstone.  If quarterly financials are an indication, then not likely.  Per the NY Times, "Viacom reported a 29 percent decline in profit in the latest fiscal quarter, putting its management in the hot seat as it continues to wage a brutal fight for control of the entertainment company."  Not just double digit but more than a quarter percent drop in profitability.  The noise coming from ownership control seems to have created quite a distraction to the running of the business.  A shame given the once powerful brands like MTV, Comedy Central and Paramount.

Given that Redstone needs to be ruled competent or incompetent while he currently owns a significant block of shares likely means the inability for an outside company to come in with an acquisition offer.  The courts must first decide whether Redstone, his daughter, or someone else has voting authority to those shares.  Any offer for Viacom would have to take a backseat until that is first decided.  But the media market is changing quickly and the value of MTV et al may no longer be there.  Does anybody want their MTV anymore?

Wednesday, August 3, 2016

Is Time Warner More Appealing To Apple

Time Warner released its quarterly earnings and the news seems to be well received.  With future earnings expected to rise, the content business is growing.  At the same time, Time Warner announced plans to buy a 10% stake in Hulu, a streaming competitor of Netflix and Amazon.  HBO continues to operate outside the Hulu platform with its subscription service HBO Go.  That service is also growing.  And lastly, there are rumors that Hulu plans to build a streaming platform to offer live feeds of cable nets.  Adding services like CNN, TBS, and TNT to Disney and Fox sounds like the start of a compelling OTT competitor to cable. 

Does this make Time Warner a more interesting asset for Apple?  To own HBO, cable nets and a piece of Hulu could be a real get for Apple.  And it would instantly propel Apple into the video streaming space with major content players.  Add to that the Warner Bros studio and Apple could apply its influence into more immersive theatrical film experiences. 

Tuesday, August 2, 2016

The End Of Physical Money Coming Soon

I have been wondering, will we soon no longer need to have physical currency?  Can the US Mint finally stop printing bills and manufacturing coins?  Can we finally go 100% cashless?  Given the speed of acceptance of digital currency, that future may be a decade or less away.

While many like to carry cash in their pocket or feel safer with dollars stuffed under their mattress, millennials have been embracing instant payment services, like Venmo, to transfer monies from one bank account to another.  At the same time, thanks to online banking, check writing has been reduced as bills are paid online and automatically from customer to provider.  Mortgage checks, credit card and utility bills, and more are paid online.  And people are using Square and Pay Pal and others to pay their share of household bills as well as other transactions. 

And as the NY Times reports, banks are beginning to embrace instant payments too.  "On Monday, Wells Fargo joined JPMorgan Chase, Bank of America and US Bank in allowing customers to send money in seconds to one another’s bank accounts using just a phone number or email address." Many may still question the security of such transactions, but the ease of use and immediate access to funds cannot be denied.  Our smartphone will be our wallet and our penny jar will become a nostalgia item.  Unfortunately, the rise of hacking and ease at which our data has been stolen from company databases may still scare a large number of people.  But once solved, the likelihood that physical monies become obsolete, another result of the rise of digital technology, could be happening in 5 years if not in the next decade. 

Monday, August 1, 2016

What Is The Apple Content Strategy?

What does Apple really want to do with their content business?  Do they want to simply distribute or do they have interest in owning original content?  Is Apple Music a competitive threat to Spotify and Pandora?  And can Apple TV be a better choice than other platforms for OTT subscription services?  So are the many questions that just scratch the surface of what is Apple's content strategy.

It has left many to wonder if Apple will buy Tidal to its Apple Music business.  Is acquiring content like Carpool Karaoke really a property to differentiate Apple Music?  And is there a connection to Apple TV?  There seems to be lacking a material strategy to show what Apple wants to do in the content space.  It just might take a definitive acquisition to show the public its cards. 

I say make a play for Viacom, and let MTV, Comedy Central, and Showtime be your anchors.  Make a play for Time Warner and its stable of Turner Networks and Warner Bros.  With these networks and libraries of content, Apple would quickly build a library of content and be a player in the content space.