Check out this article from Apple Insider. Steve Jobs may not be running the day to day, but it seems Apple is still innovative in its approach. "...Apple Smart TV could be an opportunity for the Cupertino, Calif., company to consolidate 'TV/Video content, gaming, DVR, as well as other features like apps and FaceTime into one product,' much like the company did with its strategy for the iPad." Does that mean Airplay, too? And given the high customer value, an Apple TV could have great success.
The challenge for Apple will be the cable companies and gaining access to programming without a cable box. The CableCard is not the solution; Apple would need to build a solution inside the set to descramble the cable signal and provide full access to on demand programming as well. Finding those answers would make an Apple TV a real winner.
Monday, March 28, 2011
Netflix Encourages Cord Shaving
My kids are encouraging me to drop our premium services for Netflix. Maybe because we cycle through the on demand list and find little for them to watch, maybe because there is so much buzz about Netflix. And Netflix continues to aggressively build up its content to effectively compete with HBO, Showtime,and others. "Movie rental company Netflix Inc is close to an agreement with Miramax to stream the studio's library in a deal that would be worth 'well north of' $100 million over five years, according to a source familiar with the deal. Miramax's more than 700 titles include hits such as 'Pulp Fiction' and 'Good Will Hunting.'"
And here is the kicker, it is cheaper to get a Netflix subscription then cable premium networks. So it is actually in the family's best financial interest to make the move. So how can Netflix make such aggressive distribution deals. For one, they don't have to share their revenue with a cable provider. And the more content they acquire, the more value to the customer. That means more subscribers to the service and more revenue coming in.
The premium channels have one ace up their sleeve - original content. Starz has Camelot, Showtime has Dexter, HBO has the upcoming Game of Thrones. For viewers passionate for this content, cord shaving is unlikely. For those willing to wait a year for the shows to move to DVD, Netflix will be there. Oh wait, Netflix has original content, too. So that Ace may only be a deuce.
And here is the kicker, it is cheaper to get a Netflix subscription then cable premium networks. So it is actually in the family's best financial interest to make the move. So how can Netflix make such aggressive distribution deals. For one, they don't have to share their revenue with a cable provider. And the more content they acquire, the more value to the customer. That means more subscribers to the service and more revenue coming in.
The premium channels have one ace up their sleeve - original content. Starz has Camelot, Showtime has Dexter, HBO has the upcoming Game of Thrones. For viewers passionate for this content, cord shaving is unlikely. For those willing to wait a year for the shows to move to DVD, Netflix will be there. Oh wait, Netflix has original content, too. So that Ace may only be a deuce.
Friday, March 25, 2011
Content vs Distribution: Cable vs Network
The new Time Warner Cable App, offering its customers live feed access of its channels on mobile devices, has raised the ire of the programmers. It seems the right to show a network on a channel position through a cable wire into the home does not extend to streaming media. And Time Warner Cable has read its contracts and figures that they have the rights to in-the-home mobility. "Melinda Witmer, chief programming officer for Time Warner Cable, said in an interview that her company is "well within our rights" to transmit TV channels to any device in the home, as long as it sends signals through its cables and its "secure network," rather than the "open Internet." For that reason, the app is specifically configured to work only when linked to a subscriber's home Internet connection." But is this the real fight?
It seems that this in-home access will not be enough for the tech savvy consumer. They want the same access outside the home too. And the consumers preference is to pay once and watch anywhere and everywhere. The Time Warner App is only a small step to this next model. It is a slippery slope and one that programmers don't want to take. They want to be paid for each distribution platform that their network is placed on. "Meanwhile, TV executives have reason to be wary. Some executives see an opportunity to make more money by selling shows and networks to companies like Apple and Netflix Inc. over the Web. They aren't eager to give those rights to cable operators without additional compensation." At the end of the day, it is all about the revenue.
It has become a more contentious relationship between programmers and operators. Programmers see new revenue streams while operators are trying to save their existing base. The challenge may be for operators to show programmers that their revenue is also at risk should viewers switch to other platforms. But as the nature of their relationship continues to erode, it may be difficult to find common ground.
The cable operator not saying much is Comcast. While Time Warner Cable divested itself of its programming, and Cablevision is planning the same with its Rainbow programming business, Comcast is the only operator left with both a distribution and content business. In fact, it may just be what makes Comcast most adaptable to its consumers' demands.
It seems that this in-home access will not be enough for the tech savvy consumer. They want the same access outside the home too. And the consumers preference is to pay once and watch anywhere and everywhere. The Time Warner App is only a small step to this next model. It is a slippery slope and one that programmers don't want to take. They want to be paid for each distribution platform that their network is placed on. "Meanwhile, TV executives have reason to be wary. Some executives see an opportunity to make more money by selling shows and networks to companies like Apple and Netflix Inc. over the Web. They aren't eager to give those rights to cable operators without additional compensation." At the end of the day, it is all about the revenue.
It has become a more contentious relationship between programmers and operators. Programmers see new revenue streams while operators are trying to save their existing base. The challenge may be for operators to show programmers that their revenue is also at risk should viewers switch to other platforms. But as the nature of their relationship continues to erode, it may be difficult to find common ground.
The cable operator not saying much is Comcast. While Time Warner Cable divested itself of its programming, and Cablevision is planning the same with its Rainbow programming business, Comcast is the only operator left with both a distribution and content business. In fact, it may just be what makes Comcast most adaptable to its consumers' demands.
Thursday, March 24, 2011
Can Media Buyers Change Their Models?
The population is getting older, the older are living longer, and they are spending more, too. Yet, the holy grail of advertising appeal is to the younger demographic. It just may be that the 18-49 year old audience may not be the ideal group to reach and advertisers may be missing the true mark. In fact, age may not even be an important variable to the mix. CBS certainly believes so. "Age and sex don't matter when it comes to TV ad effectiveness, said CBS Corp. Chief Research Officer David Poltrack, who has teamed with Nielsen to create what he called a historic move to replace demographics with a new model for TV planning and buying, based on viewer behavior and attitudes." But can media buyers change their behavior and attitudes to try a new approach?
It certainly makes sense knowing the psychographic tendencies of the audience you are trying to impress. And new research tools make it much easier to aggregate and analyze this information. "The growing use of single-source data like that from Nielsen Catalina and TRA Global, which combines set-top box and shopper-card data, has started to have an impact even before this, Mr. Poltrack said. That data led marketers to restore advertising budget dollars -- to TV in particular -- faster in the recent recession than in prior ones, he said." Better targeting of messages, especially to heavy users, often lead to a higher ROI. Yet, there is nothing like simple reach and frequency to break through the clutter, too.
It certainly makes sense knowing the psychographic tendencies of the audience you are trying to impress. And new research tools make it much easier to aggregate and analyze this information. "The growing use of single-source data like that from Nielsen Catalina and TRA Global, which combines set-top box and shopper-card data, has started to have an impact even before this, Mr. Poltrack said. That data led marketers to restore advertising budget dollars -- to TV in particular -- faster in the recent recession than in prior ones, he said." Better targeting of messages, especially to heavy users, often lead to a higher ROI. Yet, there is nothing like simple reach and frequency to break through the clutter, too.
Wednesday, March 23, 2011
WSJ Adding Options To Its Pay App
Sometimes you don't want to buy the whole loaf for a single piece of bread, or the whole album for a single song. So too is the case with digital newspapers. As The New York Times looks to enter the digital subscription market, The Wall Street Journal continues to be one step ahead. "Looking to get more subscribers for its iPad app, The Wall Street Journal will start selling single-issue digital versions of its morning paper for $1.99 in the within the existing free app." Understanding that there are occasional readers who may not want a subscription, WSJ is now ready to offer a single day's issue. Isn't that how newsstands function, selling daily papers. Offering single sales to the "casual" reader also provides for great sampling as a means to pushing a subscription later. It seems the virtual newsstand is finally coming together.
Howard Stern Fighting With Sirius
I guess things aren't so rosy between Howard and Sirius despite the recent renewal of his contract. "In a lawsuit filed Tuesday in New York, Stern, his agent Don Buchwald and Stern's production company, One Twelve Inc., claim Sirius failed to pay stock awards due in exchange for helping the satellite radio service exceed its subscriber growth targets." So one must wonder, is there more to this story. Contracts are never as clear cut as they are meant to be. Has Sirius found a loop hole to stop paying Howard stock or is something else amiss?
Tuesday, March 22, 2011
Writers Guild and Producers Sign New Agreement
Remember the writers' strike a few years ago. Tons of people out of work. Movie and TV show production stopped. Neither side could agree how digital dollars were to be shared. And at the end, the writers lost and the studios and networks saved tons of money. And how quickly the viewers forget the wasteland of programming including the rise and fall of The Jay Leno Show.
Well as far the WGA seems to be concerned, there will be no repeat behavior as a new deal was quickly and silently signed. "The agreement comes after less than three weeks of bargaining, in contrast to a writers' strike in 2008 shut that down much of Hollywood's production for 100 days." Members still have to sign off on the deal, but it seems certain to be sealed. No one wants to repeat that fiasco again for quite some time.
Well as far the WGA seems to be concerned, there will be no repeat behavior as a new deal was quickly and silently signed. "The agreement comes after less than three weeks of bargaining, in contrast to a writers' strike in 2008 shut that down much of Hollywood's production for 100 days." Members still have to sign off on the deal, but it seems certain to be sealed. No one wants to repeat that fiasco again for quite some time.
Will FCC Approve AT&T and T Mobile Merger - Absolutely
Can the FCC and Department of Justice ever say no to a deal? It may feel warranted initially but it never happens. These deals go through and for the most part it is for the better. It is the dragging out of the process that seems to hurt both companies and the competitive process. The NYT touts some pretty well known mega deals and most have been approved. But beyond these mergers, including the most recent NBC Comcast deal, what about others in the broader communication industry.
When AT&T was split up into baby bells who would have thought that they would merge and merge again. But despite the threat of oligopoly, new technological changes enabled new competition. The rise of the cable IP phone allowed cable companies to offer competing telephone service. That most likely was never envisioned.
The merger of Sirius and XM into a monopolistic satellite radio company seemed to appear as a huge concern too. But the merger was approved and there remains competition because of both terrestrial radio and mobile music devices. The delay in getting this merger approved only hurt Sirius in maintaining a competitive stance in an ever changing technology world.
And so to the question of the AT&T/T Mobile merger, it too should be approved ASAP. True it reduces the cellular competition into the big two with Verizon (perhaps 3 if you count Sprint), but cellular is facing growing competition from a WIFI world. And I am confident that work is on-going on the next innovation in wireless communication. For AT&T and others, they need to gain economies of scale as the wired side of their business erodes. This merger step forward seems necessary to simply remain competitive in an ever evolving and changing media landscape.
Monday, March 21, 2011
NYT vs The Daily: Can Either Overcome The Pay Wall
Next Monday, The New York Times ends its free web content and puts up a subscription wall. Today, one week sooner, The Daily erects its own pay wall as it too wonders, will anyone start buying its online newspaper. "News Corp. gets its first sense of whether readers will pony up $1 a week for a newspaper rendered in a mobile app, or if The Daily fades into the downloaded-and-forgotten oblivion that afflicts so many in Apple's App Store." Certainly, between the two content creators, the NYT has the bigger lead but it also has the most to risk. The Times has been offering free content for quite some time while The Wall Street Journal was fast to build what has become a successful pay model. The Daily comes from a strict online space with only a couple of months of sampling to urge consumers to fork over dollars for content.
Can the newcomer survive? Can the gray old lady get back into shape and adapt to a rapidly changing marketplace? Or will iPad and smartphone users simply continue to consumer content that is free to read? Is it all, one or no winners in this battle. For consumers that see the value in the product, success should come. The Times has that edge with its consumers and the online platform adds convenience for the customer. The Daily has not earned that credibility yet. Form without substance may not be enough to gain a viable base. Deep pockets however may carry the day. As tablets and smartphones grab a bigger footprint, and consumers begin to accept that they have to pay for quality content, success may come for both. At the same time, they should not stop innovating; as competition in this space will only ramp up, too.
Can the newcomer survive? Can the gray old lady get back into shape and adapt to a rapidly changing marketplace? Or will iPad and smartphone users simply continue to consumer content that is free to read? Is it all, one or no winners in this battle. For consumers that see the value in the product, success should come. The Times has that edge with its consumers and the online platform adds convenience for the customer. The Daily has not earned that credibility yet. Form without substance may not be enough to gain a viable base. Deep pockets however may carry the day. As tablets and smartphones grab a bigger footprint, and consumers begin to accept that they have to pay for quality content, success may come for both. At the same time, they should not stop innovating; as competition in this space will only ramp up, too.
Subscribe to:
Posts (Atom)
