March 14, 2015 or 3-14-15, for math geeks a once in a blue moon chance to honor Pi, 3.1415
So how about a video or two to celebrate...
Saturday, March 14, 2015
Friday, March 13, 2015
More Cable Consolidation In 2015
With Comcast buying Time Warner Cable and AT&T buying DirecTv, the cable oligopoly continues to grow smaller. The latest acquisition plan comes from Charter Communications. There is speculation that they will bid to acquire Bright House Networks, a mid-size cable operator with about 2.5 million subscribers. That could potentially bring Charter to over 6 million subscribers as well as increase the size of its footprint.
Putting another cable operator in play also brings up the notion that other cable operators could be buyers or sellers. Of those, the biggest question mark is Cablevision Systems, with over 2.5 mm subscribers, mainly in the New York DMA and a highly desirable market. Cox Communication, with over 4 million customers and systems spread across the US, from New England to California, could also be of interest. There are still a number of smaller cable operators with more regional footprints that might finally decide to seek a buyout partner.
While the FCC still mulls the fate of the two big acquisitions above, as well as work with new net neutrality rules, their plate could only get fuller. Cable and broadband infrastructure across the US requires size to gain efficiency. These deals only seek to build larger footprints to capitalize on cost efficiencies and revenue gains.
Putting another cable operator in play also brings up the notion that other cable operators could be buyers or sellers. Of those, the biggest question mark is Cablevision Systems, with over 2.5 mm subscribers, mainly in the New York DMA and a highly desirable market. Cox Communication, with over 4 million customers and systems spread across the US, from New England to California, could also be of interest. There are still a number of smaller cable operators with more regional footprints that might finally decide to seek a buyout partner.
While the FCC still mulls the fate of the two big acquisitions above, as well as work with new net neutrality rules, their plate could only get fuller. Cable and broadband infrastructure across the US requires size to gain efficiency. These deals only seek to build larger footprints to capitalize on cost efficiencies and revenue gains.
Thursday, March 12, 2015
Commercial-Free Streaming Services Hurting Cable
We have watched as cable television has, almost purposely, tried to kill itself. Money seems a powerful aphrodisiac and the desire to squeeze as much of it as possible has turned consumers away. Where broadcast TV offered viewers free content in exchange for watching ads, cable TV existed on a diet of both subscription fees and ad dollars. Broadcasters became jealous and moved from must carry status to retransmission consent in exchange for license fees too. Cable then found more ways to add revenue from adding more ad spots per hour to squeezing content together to open more ad time. Everything from running end credits and opening credits simultaneously to now speeding up actual content of shows. Unfortunately, greed is not good.
What started as a slow erosion of cable subscribers off television has led to alternatives that deliver content, complete, unfiltered, and without interruption. Technology has helped to disrupt the TV game and homes are increasingly changing their routines. Per the Nielsen results in the NY Post,
What started as a slow erosion of cable subscribers off television has led to alternatives that deliver content, complete, unfiltered, and without interruption. Technology has helped to disrupt the TV game and homes are increasingly changing their routines. Per the Nielsen results in the NY Post,
- "The amount of time US viewers spend watching live TV has plummeted by 20 minutes a day since 2013;
- Homes with subscription streaming services are watching 50 minutes of TV a day more than those without;
- Subscription video services are now in 40.3 percent of households"
Wednesday, March 11, 2015
Could Cable Network Drops Become Permanent?
The cycle of cable network drops with license fee negotiations leading to eventual relaunch could soon be over. The threat of cord cutting, the high license fees imposed by cable nets, and the desire to keep subscription prices in check could lead to cable operators dropping cable nets from their line-up, permanently.
Viacom's networks, MTV, VH1, Comedy Central and others were dropped from Suddenlink in October, almost 6 months ago, without the cable operator losing a significant number of subscribers. Given the savings and limited loss of revenue, Suddenlink may be in no hurry to relaunch Viacom networks. The latest news is that Verizon's FIOS systems have decided to not renew The Weather Channel, replacing it with a more inexpensive weather service. Should FIOS find this move to be financially successful, it too could appear to become permanent.
Given the rise of streaming services, the accessibility of network programming outside its TV line-up, and the need by cable operators to create lower priced, smaller packages of cable networks to limit cord cutting, some cable networks may be at risk of also being dropped from cable systems. If Suddenlink and FIOS can demonstrate that they can drop nets, maintain their subscription penetration, while improving their net profits, the cycle of launch, negotiate, drop, re-launch may have finally be broke. Should cable network drops become permanent, don't be surprised to see these same networks follow the HBO Now strategy of offering streaming subscription packages outside the cable line-up universe.
Viacom's networks, MTV, VH1, Comedy Central and others were dropped from Suddenlink in October, almost 6 months ago, without the cable operator losing a significant number of subscribers. Given the savings and limited loss of revenue, Suddenlink may be in no hurry to relaunch Viacom networks. The latest news is that Verizon's FIOS systems have decided to not renew The Weather Channel, replacing it with a more inexpensive weather service. Should FIOS find this move to be financially successful, it too could appear to become permanent.
Given the rise of streaming services, the accessibility of network programming outside its TV line-up, and the need by cable operators to create lower priced, smaller packages of cable networks to limit cord cutting, some cable networks may be at risk of also being dropped from cable systems. If Suddenlink and FIOS can demonstrate that they can drop nets, maintain their subscription penetration, while improving their net profits, the cycle of launch, negotiate, drop, re-launch may have finally be broke. Should cable network drops become permanent, don't be surprised to see these same networks follow the HBO Now strategy of offering streaming subscription packages outside the cable line-up universe.
Tuesday, March 10, 2015
HBO Not Worrying About Cannibalization
Yesterday, Apple formally announced an exclusive partnership (albeit only 3 months) when HBO Now will be offered strictly on Apple devices. HBO's new streaming service will be offered to all consumers regardless of whether they are authenticated cable customers or not. And like Netflix, Amazon Prime, and Hulu Plus, HBO Now hopes to capture the consumer desiring content on their digital devices. But unlike these other streaming services, HBO is risking their current subscriber revenue stream. Or are they?
The threat of cord cutting, the rise of the millennial audience, and perhaps a lucrative revenue model might just make this new approach by HBO a win-win scenario. Its corporate owner, Time Warner, no longer owns a cable operator so there is no loss of synergy. Cable operators are unlikely to drop HBO on their own cable platform as it is the most popular, highest purchased of the premium tier networks. And the pricing model may just protect HBO regardless whether a customer purchases through a cable operator or through iTunes. At $14.95 a month for HBO Now, and only a 30% share with Apple (per reports), HBO Now's net could potentially be higher than the net revenue per cable sub per month. If that is true, cable customers that cut the cord but buy HBO No could give them a net revenue gain.
I don't expect cable customers with HBO to be motivated to cut the cord because of this new streaming service. They already enjoy HBO on their mobile devices because of HBO GO, its authenticated streaming service. This added value product has been accessible to cable customers for some time. Rather, HBO Now is more focused on the 10 million or so non cable, internet customers seeking more online content, specifically exclusive content that HBO offers. The new season of Game of Thrones is one such example.
How will HBO Now do? Millennials, whose parents have cable with HBO, are likely using mom and dad's access to get HBO remotely. But for those that aren't and see incremental value with HBO content may be eager to purchase. For HBO, the launch of HBO Now seems to be all positive with limited downside risk.
The threat of cord cutting, the rise of the millennial audience, and perhaps a lucrative revenue model might just make this new approach by HBO a win-win scenario. Its corporate owner, Time Warner, no longer owns a cable operator so there is no loss of synergy. Cable operators are unlikely to drop HBO on their own cable platform as it is the most popular, highest purchased of the premium tier networks. And the pricing model may just protect HBO regardless whether a customer purchases through a cable operator or through iTunes. At $14.95 a month for HBO Now, and only a 30% share with Apple (per reports), HBO Now's net could potentially be higher than the net revenue per cable sub per month. If that is true, cable customers that cut the cord but buy HBO No could give them a net revenue gain.
I don't expect cable customers with HBO to be motivated to cut the cord because of this new streaming service. They already enjoy HBO on their mobile devices because of HBO GO, its authenticated streaming service. This added value product has been accessible to cable customers for some time. Rather, HBO Now is more focused on the 10 million or so non cable, internet customers seeking more online content, specifically exclusive content that HBO offers. The new season of Game of Thrones is one such example.
How will HBO Now do? Millennials, whose parents have cable with HBO, are likely using mom and dad's access to get HBO remotely. But for those that aren't and see incremental value with HBO content may be eager to purchase. For HBO, the launch of HBO Now seems to be all positive with limited downside risk.
Monday, March 9, 2015
Will Apple Convince Us We Need An Apple Watch?
In just a few hours, Apple will unveil its latest product to the public. Other than product refreshes, Apple hasn't released a new product since the iPad. With today's press conference, we will finally learn about all the new features, functions, and benefits of the Apple Watch; and most importantly, the Apple Watch will reach its retail stores and the general public will be able to more closely see and feel them.
A number of questions come to mind as the Apple watch is released. Will it deliver a uniquely different experience than other smart watches out already? Will it do more than current health trackers like the Fitbit, Microsoft Band, Vivofit and others? Will watch wearers replace their current watch with an Apple Watch and will non-watch wearers want to start wearing a watch? Is the price point a stumbling block or a non-issue? Can Apple convince consumers that the Apple Watch is a must have product?
Stumbling blocks for me are first and foremost the price. Second is the utility and value that would drive me to need it. And third is the battery issue. If the Apple Watch can't last a full day without a recharge, then a dead device on one's wrist has no vale whatsoever. If Apple can convince the public that they can't live without it and that it lasts the whole day, then they likely have another win on their hands; if not, it may be a major miss for Tim Cook and his team.
A number of questions come to mind as the Apple watch is released. Will it deliver a uniquely different experience than other smart watches out already? Will it do more than current health trackers like the Fitbit, Microsoft Band, Vivofit and others? Will watch wearers replace their current watch with an Apple Watch and will non-watch wearers want to start wearing a watch? Is the price point a stumbling block or a non-issue? Can Apple convince consumers that the Apple Watch is a must have product?
Stumbling blocks for me are first and foremost the price. Second is the utility and value that would drive me to need it. And third is the battery issue. If the Apple Watch can't last a full day without a recharge, then a dead device on one's wrist has no vale whatsoever. If Apple can convince the public that they can't live without it and that it lasts the whole day, then they likely have another win on their hands; if not, it may be a major miss for Tim Cook and his team.
Friday, March 6, 2015
TiVo Claims Better Solution to Comedy Subscription Service
A few days ago, NBCU announced plans to create a comedy subscription service for streaming users to enjoy programs like The Tonight Show, Saturday Night Live, and more. With a proposed monthly fee of between $2 and $4 dollars, viewers without access to the broadcast channel can enjoy these shows. The problem is they already do, on You Tube, on Yahoo Screen, and in the SNL 40 app. Why pay for the cow if the milk is free?
Obviously, once these agreements expire, NBCU could make a case for exclusive access but aren't these online tools helpful in building subscriber loyalty and moving them to want to watch the latest shows. Could advertising dollars suffer in trying to start a subscription service? And aren't there alternative ways to watch these great shows.
TiVo thinks so and is touting their aggregation marketing plan that brings comedy programming from all the broadcast channels to your digital devices. Per Fox Business, "The 'Comedy Collections,' culled from ABC, CBS, FOX and NBC, will be customized by TiVo subscribers into bundles of favorite sitcoms and late night shows. According to Rogers, the cord cutters -- or TV viewers who get content over the air (OTA) without paying a cable company -- will be able to easily do their bundling as well, thanks to TiVo's Roamio OTA (Over the Air) device." With a digital antenna and a DVR box like TiVo or Slingbox, anyone can achieve the same kind of collecting and viewing.
The challenge for cord cutters and any of us that use a DVR to record and playback later is that we have to plan in advance to record certain shows. With a streaming service, we simply have to check that a show is available then click to watch. No advance planning or set up required and that has been the beauty and simplicity of streaming content services.
Obviously, once these agreements expire, NBCU could make a case for exclusive access but aren't these online tools helpful in building subscriber loyalty and moving them to want to watch the latest shows. Could advertising dollars suffer in trying to start a subscription service? And aren't there alternative ways to watch these great shows.
TiVo thinks so and is touting their aggregation marketing plan that brings comedy programming from all the broadcast channels to your digital devices. Per Fox Business, "The 'Comedy Collections,' culled from ABC, CBS, FOX and NBC, will be customized by TiVo subscribers into bundles of favorite sitcoms and late night shows. According to Rogers, the cord cutters -- or TV viewers who get content over the air (OTA) without paying a cable company -- will be able to easily do their bundling as well, thanks to TiVo's Roamio OTA (Over the Air) device." With a digital antenna and a DVR box like TiVo or Slingbox, anyone can achieve the same kind of collecting and viewing.
The challenge for cord cutters and any of us that use a DVR to record and playback later is that we have to plan in advance to record certain shows. With a streaming service, we simply have to check that a show is available then click to watch. No advance planning or set up required and that has been the beauty and simplicity of streaming content services.
Thursday, March 5, 2015
Content Networks Chasing The Cord Cutters
Cable operators and content networks have always had a difficult relationship as buyer and seller. In the early days of cable, their relationship was more harmonious with launches coupled with marketing activities to assure that subscribers saw value from the network and networks built awareness and hopefully ratings. But the proliferation of cable networks, a loss of brand as niche networks began looking more and more like UHF channels, and a price only mentality have turned these negotiations bitter and untrustworthy. The result has been broadcast and cable network drops, followed by ads telling subscribers how horrible the other side is behaving, and then finally a relaunch.
Consumers are changing too. No longer do they seek content simply from a cable operator; now, they can watch TV shows and movies via a broadband connection. And while broadband subscription rises, cable subscription is dropping. Cord cutting is a fact. Recognizing that the cable operator is not the only distribution platform anymore, content networks are constructing deals on OTT platforms. Most recently, it was announced that AMC, IFC, and Epix are joining the Sling TV digital platform. For as little as $20 a month, subscribers can get these nets as well as ESPN, HGTV, TNT and a few others. Less networks than a cable operator subscription package but at a lower cost to the consumer.
HBO has also announced that it too will offer its network without the requirement of a cable operator. Tentatively titled HBO Now, it helps them to compete in the same new world that Netflix, Amazon Prime, and others compete in. With cable nets building alternative avenues for access, the pressure for more cord cutting will only continue to mount. And as negotiations with cable nets lead to drops on cable systems, the likelihood that these networks will relaunch may become a distant memory. Networks can simply advertise an alternative way to get the networks they love without the cable operator as the middleman.
Cable operators have done little to compete in this changing media environment. TV Everywhere is not available to subscribers for all its nets; rather only certain networks offer authenticated carriage, some only inside the home, and with no aggregated way to easily search across a line-up. Cable boxes remain clunky and hard to navigate unlike IP devices. New packaging is not being created to drive down the subscriber price point to enable stronger retention. Rather, prices continue to go up to keep revenues stable.
What does the future hold? I see cable operators dropping cable networks that don't perform. Smaller packages of cable networks but at lower price points. I see operators needing to invest in new generations of cable boxes, embracing the TiVo type boxes that access both cable and internet content and bring it to the TV screen. And I see the emergence of a la carte pricing where a home can buy a particular network through their cable box for access across all their devices.
Consumers are changing too. No longer do they seek content simply from a cable operator; now, they can watch TV shows and movies via a broadband connection. And while broadband subscription rises, cable subscription is dropping. Cord cutting is a fact. Recognizing that the cable operator is not the only distribution platform anymore, content networks are constructing deals on OTT platforms. Most recently, it was announced that AMC, IFC, and Epix are joining the Sling TV digital platform. For as little as $20 a month, subscribers can get these nets as well as ESPN, HGTV, TNT and a few others. Less networks than a cable operator subscription package but at a lower cost to the consumer.
HBO has also announced that it too will offer its network without the requirement of a cable operator. Tentatively titled HBO Now, it helps them to compete in the same new world that Netflix, Amazon Prime, and others compete in. With cable nets building alternative avenues for access, the pressure for more cord cutting will only continue to mount. And as negotiations with cable nets lead to drops on cable systems, the likelihood that these networks will relaunch may become a distant memory. Networks can simply advertise an alternative way to get the networks they love without the cable operator as the middleman.
Cable operators have done little to compete in this changing media environment. TV Everywhere is not available to subscribers for all its nets; rather only certain networks offer authenticated carriage, some only inside the home, and with no aggregated way to easily search across a line-up. Cable boxes remain clunky and hard to navigate unlike IP devices. New packaging is not being created to drive down the subscriber price point to enable stronger retention. Rather, prices continue to go up to keep revenues stable.
What does the future hold? I see cable operators dropping cable networks that don't perform. Smaller packages of cable networks but at lower price points. I see operators needing to invest in new generations of cable boxes, embracing the TiVo type boxes that access both cable and internet content and bring it to the TV screen. And I see the emergence of a la carte pricing where a home can buy a particular network through their cable box for access across all their devices.
Wednesday, March 4, 2015
Connectivity Brings Le Freak Out
The issues of security and privacy will not go away; as long as there exists devices to stop unwanted entry, there are people destined to break in. The latest security breach is called "Freak" and affects mobile devices including iPhones and Android, as well as Mac computers. So get ready to Super Freak, to Get Ur Freak On, to Le Freak, or simply Freak Like Me. Okay, enough song title references.
According to re/code, "The vulnerability in Web encryption technology could enable attackers to spy on communications of users of Apple’s Safari browser and Google’s Android browser, according to researchers who uncovered the flaw." Once discovered, corrections are being made and software updates will follow. But it is only a matter of time till another bug is discovered, another flaw exposed, and folks with dishonesty on their minds will seek to take profit from it.
This cycle of hacking to exploit data for nefarious means will never end. The more sophisticated the encryption, the bigger the challenge and drive to try and expose it. Never ending, we will be faced with stories like these for many, many years. Think The Imitation Game but with bad individuals hacking into our personal and financial information. Perhaps The Matrix is right, we might need to consider getting off the grid.
According to re/code, "The vulnerability in Web encryption technology could enable attackers to spy on communications of users of Apple’s Safari browser and Google’s Android browser, according to researchers who uncovered the flaw." Once discovered, corrections are being made and software updates will follow. But it is only a matter of time till another bug is discovered, another flaw exposed, and folks with dishonesty on their minds will seek to take profit from it.
This cycle of hacking to exploit data for nefarious means will never end. The more sophisticated the encryption, the bigger the challenge and drive to try and expose it. Never ending, we will be faced with stories like these for many, many years. Think The Imitation Game but with bad individuals hacking into our personal and financial information. Perhaps The Matrix is right, we might need to consider getting off the grid.
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