Another Inane Commercial That Makes You Wonder

If you have been reading my blog, every now and then I come across an inane ad that makes me cringe.  From the 'Vacation' Infiniti ad to the FIOS ad to the silly TD Bank ad.  Well the latest one seems to beat them all so far.  It involves a dad with his young son racing a school bus to get to school.  It seems that driving a Nissan Altima can help you outrace a school bus... WHAT????? The premise not only makes no sense it defies any logic or rational thinking.  Does Nissan want us to believe that they don't think much about safety?  There is nothing aspirational, beneficial, or even informational about why a Nissan Altima would become your preferred car to drive.  And frankly, it lacks any humor to even offset the serious consequences of what they are presenting.

If you haven't seen this atrocious ad, take a look:

Altice To Buy More, Pay Less

The European telco, Altice, plans to buy more cable properties as it grows its footprint in the United States.  At the same time, they have already stated that they expect to pay less to keep costs low and margins high.  According to Deadline Hollywood, that they will pay less for channels or drop those that don't perform.  At the same time, he cites some high wage earners in the company that may not be a part of their future.

Given Altice's desire to become a bigger force in cable operations, challenging both Comcast and Charter for system ownership, more deals could come in the next year or so once the FCC approves the Altice purchase of Cablevision and Suddenlink.  That means that Cox Cable could also be in their sights, as well as Mediacom, WOW!, and CableOne. 

Consolidation might also lead to Verizon watching how well AT&T is doing with their DirecTV purchase.  If they start to see success, Verizon might want to kick the tires on Dish Network.  Of course, there is always Google and their slow fiber expansion across a few cities.  Perhaps Verizon is tired of supporting their FIOS brand and willing to get out of the wired business completely to refocus on wireless broadband. 

The media landscape looks to get more interesting given the involvement of Altrice into the mix.  And new cost structures could lead to a quantum change in channels and services being offered. 

Dolans Finally Agree To Sell

The Dolan Family sure knows how to unlock value. The question in media for a decade or more has always been when will Cablevision sell its systems.  Does patriarch Chuck Dolan need to retire or pass on for Jimmy to let go of the family run business?  But before that would happen, the Dolans would unlock the value of its holdings by spinning off both the AMC Networks and MSG businesses into two separate companies, each still controlled by the family.  And that value boost continues as the MSG company splits into two itself with media and event spaces being separately run.  The result, the empire value has grown and grown.

Today, that profitability continues as the Dolans have agreed to sell its Cablevision business, comprised mainly of  its control of Long Island cable systems as well as Newsday and News 12 cable networks to Altice, a European telco.  And they sell it at a very high premium to its latest stock price.  While Cablevision may have less than 3 million subscribers, its region of Long Island is considered a premium system with the highest household incomes.  It also faces direct competition from Verizon FIOS across the footprint.  Still Attice seems committed to enter the cable media industry.

Altice previously announced its plans to buy the Suddenlink cable properties which when added with Cablevision gives them less than 5 million subscribers.  Neither acquisition will likely bring any cost savings through synergy, unlike the Charter - Time Warner Cable merger.  Altice will likely look for more cable systems to acquire.  Could Cox Cable be next on their screen?

As to the Dolans, the sale of Cablevision might just be a great move to unlock value before the cost of cord cutting takes too heavy a toll. And with their ownership of content companies like AMC and MSG, a freedom to find more revenue generating opportunities outside of cable or fearing moves negative to the cable operations side of their balance sheet.  Rumors are already flying of AMC's plans to purchase the Starz Network.  Perhaps the cash from Altice makes that purchase easier to swallow. 

FanDuel Vs. DraftKings

My sports content is being overrun with ads from two online sports fantasy campaigns.  It seems that every game, pre-game, and post-game has one or the other as a sponsor.  Fantasy leagues have been invading the sports world for some time; we are asked to no longer root for teams but for individuals instead.  And you thought there was no 'i' in team.  Each channel that presents an NFL game seems to have either FanDuel or DraftKings as a major advertising sponsor. 

Personally, I am not a fantasy sports participant, but I do understand the appeal.  It can offer a great mathematical intrigue but lately it seems to be all about the cash.  Each commercial reminds us how much money can be made daily, weekly and annually and parades real people, not actors, enjoying their financial success in fantasy bets. 

These ads are all over every NFL show..  And the NFL seems to be embracing it, perhaps because of all the money that is pouring into the league.  But the very nature of gambling and sports getting tied so closely together seems somewhat troubling for the honesty of the game.  Will it lead to manipulation, scandal, and more?  Are we headed down a slippery slope that could cause bigger troubles?  When ads present how easy it seems to win, we should also ask how easy is it to lose.  Maybe Pete Rose needs to be asked the effect gambling has had on his career.  I'm afraid the dollars being spent to push consumers to bet will only lead to bigger problems for sports and for media. 

Thanks For The Memory

The new Apple iPhones have been announced and my kids are ready for their upgrade.  The reasons range from battery problems to the chic factor, but regardless they both want to get their hands on the iPhone 6S.  Am I made of money?  Of course not and Apple knows that too so with their latest announcement comes word that they are willing to provide my kids with annual upgrades to their phone for a monthly fee. 

So the next question is how much memory to choose and frankly, selling a 16 GB phone is a joke.  Given the number of photos taken, songs and videos, not to mention apps, 16GB is used up before we even start.  And the phone requires unused memory each time a new version of iOS needs to be installed.  Of course Apple makes more money with higher memory options and likely better profit margins as well.  So why does Apple even bother to sell a 16GB phone when they know that 64 GB is more the minimum needed; in fact it might just be time to offer a 1MB version.   Wait a few more years and even that amount of internal storage won't be enough. 

The Future Of TV Is Apps

The latest version of Apple TV was announced yesterday and with it an announcement from CEO Tim Cook that the future of TV is apps.  No longer will we ask to turn to a certain channel; now we can say switch to this app or that.  Not such a farfetched idea but Cook may be a little late to the game.  The new Apple TV will be enabled to offer both streaming content from apps like Netflix, HBO and more as well as gaming apps.  And all will be accessible via Siri as well as a new remote.

But other boxes are already in the marketplace offering both video streaming and games.  The biggest two in the space are Playstation and Xbox while others are enabled for video streaming like Chromecast and Roku.  And others like TiVo try to bridge the gap between cable boxes and streaming.

Still the release of the Apple TV and their new TV app store marks another growth opportunity for Apple.  Because as we start using devices to access apps on our TV, we open ourselves to new screens for on screen advertising, a game that Apple has yet to enter.  Still with eyeballs comes opportunity.  And it potentially could lead to possible e-commerce opportunities too.  That will be Apple's future growth opportunity...advanced advertising. 

The initial success of this new Apple TV box depends on just how cool the interface is, how ergonomic and easy it performs, how exclusive is the content that can run on it, how fast it functions, and how excited people are to try it and buy it.  That remains to be seen.  The potential is awesome.

As to the Cook comment that the future of TV is apps, I believe he is correct.  With content being enjoyed across apps like Netflix, Hulu, Amazon, HBO GO, WatchESPN, and many more, content companies have already been positioning themselves for the app space.  Consumers are embracing these apps mostly because of the mobility and TV Everywhere approach that they offer.  And now we are asking what app are they watching that show on. 

Verizon Tries Again with Streaming Content

For those that recall, Verizon has tried its hand at streaming media already.  Their service was called Redbox Instant, a partnership with the grocery store red box DVD rental service, to compete head to head with Netflix.  Redbox Instant was dropped almost a year ago.  Today, another streaming service has been announced.  Called Go90, it is a mobile app for the phone to stream video content.  The 90 refers to turning the screen 90 degrees from vertical to horizontal for optimal viewing and the GO aligns itself to other streaming services like HBO GO .  But this video service is not built to compete with premium content like Netflix or HBO; rather, it seems set to offer more basic cable type of video fare. 

Also different from the Redbox Instant model, Go90 is being delivered ad-supported, with no subscription price, to to anyone with a smartphone.  While Verizon customers may get an optimal experience, others will hopefully also receive a reliable video stream.  Will Go90 be a cable killer, unlikely.  I suspect that most of the content will be older in nature.  It will certainly help those that prefer mobile viewing with more content at their disposal.  Will Go90 be a financial success; that too will remain to be seen. 

Next Generation Apple TV

Apple's big formal public announcement is still two days away, but rumor, speculation, anonymous sources, and more are providing enough fodder to keep us intrigued.  We expect another update to the iOS operating system, a next model iPhone, a slightly larger iPad (perhaps ideal for enterprise customers) and finally a new generation Apple TV set top box. 

But as we have always learned, a TV box is more than just hardware, it needs content to run it as well.  And for it to be successful, exclusive content that only works on the device.  For that, various articles, including today's NY Times, expects gaming to be that hook.  Are we expecting Pong to make an appearance, literally one of the first games for the TV set.  Or will we get something that makes wanting to play a mobile game better suited for the TV set and not the iPad or iPhone.  Certainly not Candy Crush or Angry Birds, I hope. 

Siri is expected to play a bigger part on the hardware side of the Apple TV along with a new remote.  As much as it is nice to control the TV set from your iPad or iPhone, there are times when changing the channel and using these devices are mutually exclusive.  And switching back and forth from 2 applications not enjoyable.  Perhaps not a big deal but good to have options on different ways to control the functions of the box. 

Will a refreshed Apple TV start to take market share away from Roku, Google Chromecast, or other OTT boxes?  Apple will need more than gaming and the rumor mill says they have yet to get enough content to create a subscription service to match Amazon, Netflix, or Hulu.  To this I continue to say it may be time to buy, not build from scratch.  More will be learned in just a couple days.  Perhaps we will also get some more surprises out of Apple.  And if the announcement excites many, a good Holiday Season may be in our future. 

Hulu Offers A More Expensive Ad Free Subscription Service

How do you like your streaming video, with ads or without?  Most subscribers are likely to say 'without' and Hulu seems to have finally heard that message.  While Netflix charges between $8-$9 dollars a month for an ad free service, and Amazon offers its ad free service, with free shipping, for $99/year, or approximately $8.25 a month, Hulu will now ask customers for $12 a month for its new ad free service.  Of course, if you want to save a few bucks a month, you can still get Hulu for $8 a month with ad interruptions. 

So now streamers, which video subscription service is right for you?  Of the big three above, each offers TV shows and movies and each have their own exclusive content deals; Amazon has Transparent, Hulu has Seinfeld, and Netflix has House of Cards.  And now comes word that Apple might just want to break into this group with a content offering as well.  What does a consumer do?  Buy one service or all of them?  And what about HBO, Showtime, and Starz?

And how do we search and find content that we want to watch online?  The TV Guide Magazine can no longer help us and our cable guide is a dinosaur trying to hunt and peck for linear and on demand content.  Where can I go so to find a movie starring the recently departed Dean Jones?  Who has the streaming rights this month to Love Bug or That Darn Cat or Blackbeard's Ghost?   And how do you want to watch them, with ads or without?