Nielsen: Almost 99 Percent of Video Watched on a TV Screen

With so much talk about online video and its threat to broadcast and cable, it seems to be overblown. TV usage is at an all time high while online video watching represents a mere 1% of total viewership. That translates to over 153 hours of TV a month versus 3 hours of internet viewing. "DVR use is becoming more mainstay as well, with the number of time-shifted hours watched jumping 40 percent from the same time last year to more than eight hours per month." Consumer preference continues to be to watch their shows on their big screen TV.

And while there is no short term need to worry about TV consumption for the cable industry, there should still be a concern about the trend.From Q4 '08 to Q1 '09, TV consumption grew less than 2% while internet viewing grew by a whopping 53.2% That growth should tell Hulu, Joost, and other online video distributors that their platform is growing rapidly. "Nielsen stats have come under fire recently in both the old and newteevee worlds. Online, Hulu expressed frustration over its audience numbers, and TV networks are increasingly critical over whether their ratings are accurate. However, these latest stats reaffirm previous studies touting TV’s strength."

News Sharing: One For All, All For One?

Does it matter which channel you watch for your local news? You may find they are sharing more and more. As ad dollars soften, costs get cut and networks have found a number of ways to improve the bottom line. One avenue is to share services. Networks are now using the same helicopter to report traffic conditions on the roads. Here in New York, the channel 9 sports anchor also delivers sports for channel 5. In addition, networks are sharing cameras to cover major events. "Fox-owned KSAZ, Scripps' KNXV (ABC) and Meredith's KPHO (CBS) relied on their recently formed newsgathering partnership to supply footage of the president's arrival and his motorcade through the city." And lastly cheaper talent is being used to report the news as big salaries can no longer be carried.

"With newsroom budgets under pressure like never before, TV stations in a growing number of markets are suppressing their competitive instincts and forming news co-ops to capture and share video of public meetings, press conferences and other routine events." How far can this go? One network may supply the same news show for two different channels, one at 10 p on one net and again on 11p on another channel. It seems to be the way we are headed.

Advertisers get demanding as TV networks try to be creative

Ad spending is declining and content companies are looking for creative ways to get their biggest slice of the ad buy. The "big fish" networks with their hands in many platforms may have to build ad packages that are more than just linear schedules. "Collaboration has become key to sales, with more advertisers demanding that networks work with them to create innovative campaigns weaving brands into shows and across platforms." That means in program, VOD, web, and mobile. Product placement, sponsorship, sweepstakes, interactive participation, sampling, and social networking. The simple ad buy can no longer be simple.

And the big networks, with their fingers in broadcast and cable, video web portals, mobile websites, etc. may have to reach across their businesses to synergize the complete solution for their advertiser. For Fox, that might mean building a campaign that includes Fox Network, Fox News and Fox Business Channel, VOD, My Space, and even Hulu. And in the case of Hulu, does that become problematic in determining what part of the buy is Hulu's, especially when sharing the revenue with NBC and soon to be Disney. And doesn't an integrated, multi-platform buy mean cost savings for the advertiser. How much is the Hulu share discounted as a percentage of the total ad buy.

"Companies also want to know more about viewers than just how many there are and their basic demographics. They want to know who is paying attention to the commercials, and whether those ads compel them to actually make a purchase." Online and VOD data can provide far more accurate data on the viewer than linear. Tivo can get more info on time shifted usage. Big brother may simply be the advertising companies knowing more about how we consume the content we view.

Facebook Is The Go To Site For Everything

Social Networking has become the predominant way to communicate with our friends. We write emails through our Facebook account, share photos, exchange news items, and discuss our opinions. And as video chatting and skyping have gotten more popular, why not add it to the social networking mix. Well it seems Facebook is soon to come out with such an app. Now while I currently have Skype for the grandparents to talk to the grandkids, why not simplify it and chat inside Facebook. It would be convenient to have the option to video chat online with a "friend". And certainly, the price is right.

But maybe you don't want to chat when your on Facebook. Sometimes you want to simply be an observer, reading other people's comments but not communicate directly with them. And sometime when a chat screen appears, you don't know whether to answer or ignore it. Would that be rude. Will people start to list themselves as "invisible" so they can troll their account without anyone knowing they are online.

But be careful what you do or say in front of your videocam, the on-air light might just be on!

New York Times Considers Two Plans to Charge for Content on the Web

Can The New York Times put the cat back into the bag; that is, start charging for what was once given away free. Clearly we have been used to as consumers in getting free samples but will consumers be willing to start buying. Unlike The Wall Street Journal which has been charging a subscription fee from the start, it also has been the number one source for business news. Their unique value and brand appeal has enabled them to charge a premium to read their content. The New York Times, on the other hand, has no one specialty; some like their Business news, others their Sports, and other their Style and Editorial features. Can that broadness help or hurt them changing their business model. Will their readers stay with them and pay or go elsewhere for the news. And can the NYT keep their writers, like Mossberg and Pogue, from sharing their content outside the walled garden they might set up.

In order for The New York Times to survive, it's content can't remain free. Putting it into a subscription model of some sort will do one of two things. At the worse scenario, it drives people away from a NYT subscription and website quicker and kills brand loyalty and at the best scenario, provides web subscription to current print subscribers and incremental revenue for digital subscribers. Advertising will either decline or grow depending on what consumers choose. The New York Times provides a definitive point of view embraced both inside the tri-state and around the country. Financially, the only chance they have to future survival is a revenue model from subscription and advertising. Requiring subscription to web content might lower eyeballs in the short run but should ultimately pay off with subscription and more usage in the long run.

Verizon Selling Some Phone Markets

Verizon took a bold move this week, selling 4.8 million phone lines in 14 states to Frontier Communications. It gives Verizon a piece of Frontier's business, but more importantly, indicates that Verizon is concentrating instead on larger communities where it can replace copper lines for fiber and offer their FIOS product. Small, rural markets are best served by others. In addition, it allows more focus on wireless, especially as consumers shun their hard wired phone for cellular. "The local phone business, in fact, has been contracting quickly as customers shift to phone service offered by cable companies or simply to using their cellphones. Verizon, which will have 30.3 million phone lines left after the deal, lost 10.2 percent of its lines last year in the regions it is selling."

As capital is tighter than ever, and cost management means doing more with less, Verizon is better served concentrating on FIOS and wireless businesses where larger growth is more likely. Consumers are demanding a broadband connection and the costs to rebuild these smaller markets is high. The future for Verizon is their FIOS and cellular operations providing consumers and businesses multiple products: cable, broadband, IP phone, and cellular.

DVD Tops for Entertainment; Online Delivery Small But Growing

Consumers are still buying DVD's, but streaming usage is growing. And " even digital downloaders have not abandoned those shiny little discs. Eight out of 10 who downloaded movies also said they bought or rented a DVD," which indicates that physical media is not going away. For me though, the huge library of content online and easily accessible, makes me less inclined to have to own content. That rent or own philosophy seems to dictate my decision.

With the ease of VOD to watch on TV, and the lower cost to view, why purchase a DVD that has no long term interest to me. Those rare exceptions seem to be children's movies, including many Disney and Pixar titles, that get repeat viewing in my household. Other films, like the Oscar-winning Slumdog Millionaire, was great to watch on VOD; but having watched once, I find no need watch again. Still renting or streaming a film first lets me decide whether I want to make a bigger commitment to purchase.

How will I feel once I own an HDTV and will I feel the need to buy a blu-ray player and own blu-ray DVDs; I just don't know. Will HD keep the DVD the predominate choice? It may slow down the trend to streaming, but it won't stop it.

While Netflix enjoys a healthy relationship of DVD media with its customers, the customer still treats those disks as rentals not purchases. Blockbuster and other video stores are expanding their offerings to gaming disks and other non-film product to increase their revenue streams. Will customers want to own the physical asset? That media must change and get smaller and easier to manipulate. Whether saved on thumb drives or other smaller transportable device, the current DVD must give way to these new media choices, just as the LP gave way to the cassette, the VHS to the DVD. We want more content packaged into smaller boxes. Customers will still buy; how they receive the content is what keeps changing.

Cablevision: MSG Is Not For Sale

Clarification from the Cablevision camp that should a spin off of MSG occur, it would not be for the purpose of selling the properties, merely to put more shareholder value back into the hands of Cablevision stock owners. And the Dolans would continue to retain majority ownership. "The MSG unit includes the Madison Square Garden arena; the MSG and MSG Plus regional sports channels; sports teams the New York Knicks, New York Rangers and New York Liberty; Radio City Music Hall; the Chicago Theater; the Beacon Theater and cable music channel Fuse."

While I did not personally read anything that stated possible selling of MSG, I did read about speculation of possible selling of the Long Island cable system and Rainbow programming unit with Time Warner and Comcast the most likely buyers. Keeping speculation low only drives up the intrigue value. Who knows what will or won't happen. The likely scenario continues to be no change.

Cablevision to Explore Madison Square Garden Spinoff

Will Cablevision spin off their Madison Square Garden businesses, including MSG, Knicks, and fuse? If you have heard about spin offs in the past, you aren't dreaming. This kind of speculation has been around for many many years. The closest they came was a tracking stock for Rainbow about a decade ago, but that was eventually re-ingested back into Cablevision.

For the public record, I once worked for Cablevision but have absolutely no inside information what they are planning to do. Still, if history is any guide, this speculation seems to be a regular occurrence and always seems to have the effect of raising the stock price. While Cablevision has recently been a buyer, having bought both Sundance and Newsday in the last year, the last time they sold something was when they sold Bravo in late 2002 to NBC.

A separation of companies has always been seen as a positive way to unlock the value of the assets. Others have speculated that it's Chairman is more interested in sports and music, than the cable business. Splitting the businesses would make it easier to get a truer market price on the cable side too with the opportunity to sell those assets to another cable company. Time Warner has always been desirous of owning the jewel of the NYC DMA, Long Island, which Cablevision runs. Cablevision continues to avoid further comment.

Will this be the time that Cablevision actually pulls the trigger on an asset spinoff? If history is a guide, don't hold your breath. It may simply be a means of pushing the stock price higher on news but not action. Still, anything is possible.