So it is the start of the new month, with thoughts of the holiday and new gadgets for the home, office, and play. Content remains king as Cablevision finally acquiesces to Fox's terms, as did Dish a few days earlier. Apple is suing Motorola for stealing patents and Tivo is still waiting to resolve its long term patent fight with Dish. New Apple iPads and iPhones are coming to market as are a multitude of other tablet-like products. And 3D remains the possible next great TV upgrade.
It is clear to me that the pace of change is quickening and competition is getting fiercer and fiercer. What is ahead for 2011. Soon the prognosticators will emerge with their insights on what to expect. For me, a few obvious and some not so obvious:
1. Verizon iPhone and iPad are instant successes
2. A major Cable Distributor merges with another
3. Tivo finally wins it's patent fight with Dish
4. Apple buys a content company
5. Comcast and NBC do indeed merge but with many caveats
6. And another network goes off the air in its contract dispute.
Put it in a jar. I'm picking early and I'm feeling confident in my predictions.
What are yours?
Monday, November 1, 2010
Sunday, October 31, 2010
Cablevision and Fox End Fight
It took two weeks, but the stand off is over and Fox is back on the air in Cablevision homes. "Cablevision begrudgingly ended its dispute with News Corp. Saturday after several weeks of contentious negotiations over fees, getting Fox 5 back on the air just in time for the first pitch of the third game of the World Series." And in getting to agreement, I am confident in saying that some increase in fees occurred. How soon that increase to Cablevision customers remains to be seen, but I will make a first guess and say that it will happen between January 1 and February 1.
And it is leading us down the path to a la carte pricing, for both networks and individual shows. As bundled fees get more pricey, the customer is cord cutting. Moving toward content that is less expensive. And asking to pay less to get only the networks and shows they want to buy. Consumers will pay less at the end, but get less at the same time.
But back to the present. Cablevision customers were without their content for two weeks and will still end up paying more. The end didn't justify the means. The result for them is the same, an increase in fees. And as predicted, the customer continues to lose.
And it is leading us down the path to a la carte pricing, for both networks and individual shows. As bundled fees get more pricey, the customer is cord cutting. Moving toward content that is less expensive. And asking to pay less to get only the networks and shows they want to buy. Consumers will pay less at the end, but get less at the same time.
But back to the present. Cablevision customers were without their content for two weeks and will still end up paying more. The end didn't justify the means. The result for them is the same, an increase in fees. And as predicted, the customer continues to lose.
Saturday, October 30, 2010
Cablevision-Fox Duel Continues
The NLCS, 2 World Series games, NFL Football, and of course all the Fox TV shows have been unavailable to Cablevision customers for too many weeks. And in that time, customers have been asking for rebates, others have switched to alternative distributors like FIOS and Direct TV, and others have purchased a digital antenna. And others have learned to simply do without. This battle simply demonstrates that both sides are wrong. Putting the consumer in the middle is not smart and forges bad feelings. Both Cablevision and Fox may hope the public has a short memory and will soon forget once this ugly business ends. But others will see this as a wake up call to what is going on in cable. I am not taking either company's side in this argument. Both are wrong; but at the end of the day, regardless of the outcome, the only party hurt will be the customer. And that is ultimately who needs to be protected.
Friday, October 29, 2010
Is Print Media Dead In 10 Years?
It's October 29, 2020 and you are drinking your coffee and eating your breakfast. Or you are starting your commute on the train or waiting for your flight to take-off. It is during these and other times, that you find folks reading their newspapers, magazines, and books. But according to this new study, we will all be doing these activities on our digital reader. Print will be dead. "The 24/7 Wall St./Harris Poll on American Media shows that 81% of people believe that the use of print news will decline. That, however, is cold comfort because 55% of those questioned said that traditional media will no longer exist in 10 years."
Now it is very clear where the trend is headed, so no doubt, print media in its traditional form will decline. But I very much doubt that it will cease to exist in 10 years. So I guess I am in the minority. These same type of statements have been said every time a new item was displacing an old one. And yet we still listen to radio, we still use trains, and we will still read print. The truth is that any change forces the older item to adapt or die. But the need for print will remain albeit in perhaps other opportunities. And the transition to an all digital world will not be accomplished within 10 years. I suspect it will take another decade or two. And yet there will always be a need for a printed copy. Whether that printing is done at printers or directly in the home, some form of paper will still be around. We may eventually share it, move it around, and consume media digitally, but we will also still like some of it to be printed.
Now it is very clear where the trend is headed, so no doubt, print media in its traditional form will decline. But I very much doubt that it will cease to exist in 10 years. So I guess I am in the minority. These same type of statements have been said every time a new item was displacing an old one. And yet we still listen to radio, we still use trains, and we will still read print. The truth is that any change forces the older item to adapt or die. But the need for print will remain albeit in perhaps other opportunities. And the transition to an all digital world will not be accomplished within 10 years. I suspect it will take another decade or two. And yet there will always be a need for a printed copy. Whether that printing is done at printers or directly in the home, some form of paper will still be around. We may eventually share it, move it around, and consume media digitally, but we will also still like some of it to be printed.
Thursday, October 28, 2010
Comcast Profits Grow, Subscribers Fall
Comcast reported its earnings and the news seems to make one wonder. Profits grew, less than the previous period, but higher than analysts expected. And in this economy, any profit is a good sign. Still, when you dig deeper into the numbers, how they got there indicates a growing problem. "That was the underlying question about Comcast’s third-quarter earnings, in which an overall strong performance was clouded by the loss of 275,000 basic cable television subscribers." So less customers are paying more for cable service.
More cable customers are buying additional services including phone and internet access. And profits reflect that growth as well as higher cable charges. At the same time, a quarter of a million customers chose to disconnect. It is now assumed that those customers are cord cutters, leaving cable but accessing content through other online means. But Comcast executives don't think this loss reflects either cord cutting or competition. "Instead, they blamed the weak economy for the losses and said that many who cut service did not flee to a competitor — like Verizon or DirecTV — but instead opted for free, over-the-air television." Wow! So cable service is now the great indicator of the loss of the middle class. It is the dividing line between the haves and the havenots. As the cost of service goes higher and higher, customers must revert back to over the air access and use their disposable dollars on the necessities of life. Has television gotten that expensive?
The sad fact is that price is driving customers away from traditional cable companies and to alternatives. Current FIOS and U-verse deals are cheaper and in a weak economy, customers are going to pay less to save money. Others, mainly the younger generation, are more comfortable getting content online. They are saving money by cord cutting. They embrace new technology and alternative content platforms. And they are being driven at a faster rate because the price of cable has gotten out of control.
Comcast will continue to draw more revenue from a diminishing base. And at some point, the growth of dollars per customer will not offset the total loss of customers. You can't squeeze blood from a rock and more and more customers have reached the limit on how much they are willing to pay to their cable provider. Pay attention to this quarterly trend of lost basic subscribers. It is a bigger problem and trying to minimize the issue will not make it go away.
More cable customers are buying additional services including phone and internet access. And profits reflect that growth as well as higher cable charges. At the same time, a quarter of a million customers chose to disconnect. It is now assumed that those customers are cord cutters, leaving cable but accessing content through other online means. But Comcast executives don't think this loss reflects either cord cutting or competition. "Instead, they blamed the weak economy for the losses and said that many who cut service did not flee to a competitor — like Verizon or DirecTV — but instead opted for free, over-the-air television." Wow! So cable service is now the great indicator of the loss of the middle class. It is the dividing line between the haves and the havenots. As the cost of service goes higher and higher, customers must revert back to over the air access and use their disposable dollars on the necessities of life. Has television gotten that expensive?
The sad fact is that price is driving customers away from traditional cable companies and to alternatives. Current FIOS and U-verse deals are cheaper and in a weak economy, customers are going to pay less to save money. Others, mainly the younger generation, are more comfortable getting content online. They are saving money by cord cutting. They embrace new technology and alternative content platforms. And they are being driven at a faster rate because the price of cable has gotten out of control.
Comcast will continue to draw more revenue from a diminishing base. And at some point, the growth of dollars per customer will not offset the total loss of customers. You can't squeeze blood from a rock and more and more customers have reached the limit on how much they are willing to pay to their cable provider. Pay attention to this quarterly trend of lost basic subscribers. It is a bigger problem and trying to minimize the issue will not make it go away.
Wednesday, October 27, 2010
Barnes and Noble Update The Nook
Just in time for the holidays the Nook e-book reader has been updated with new features. "The new touchscreen Nook Color, priced at $249, costs about half as much as an entry-level Apple Inc. iPad—but almost twice as much as an entry-level Kindle from Amazon.com Inc. and Barnes & Noble's existing monochrome Nook device."
The issue for Barnes and Noble is to identify who its competitors are and what positioning strategy they are impacting. Kindle is seen as the leader in the e-book category and the Apple iPad may compete but may not fit how readers wish to access their books. For them the iPad is too much and too expensive. For the Nook, the question becomes, do these new features and price point drive market share. Should more attention be made on price or should the push be on the exclusivity that B&N can add to the Nook that aren't available from Amazon. Clearly having brick and mortar stores must offer some advantages that they can capitalize on.
Currently the numbers don't look good for the Nook. "Barnes & Noble, which first unveiled the Nook last fall, has had difficulty catching up with market leader Amazon. Forrester Research estimates that by the end of this year there will be 6.1 million Amazon Kindles on the market in the U.S., but just 2.1 million Nooks and 2.2 million Sony Corp." The question to B&N remains, does this new version do enough to capture a bigger piece of the market. To me it is more than offering color. Take a page from the Apple playbook and figure out how to drive more usefulness into your product mix. A device does not run without software and content that is of value to the customer.
It is exciting to watch how far the e-book category is growing. Clearly it is the next physical media being transformed into our digital landscape. Watching the changes in TV, movies, and music, may give some hints to these players in acquiring and retaining customers.
The issue for Barnes and Noble is to identify who its competitors are and what positioning strategy they are impacting. Kindle is seen as the leader in the e-book category and the Apple iPad may compete but may not fit how readers wish to access their books. For them the iPad is too much and too expensive. For the Nook, the question becomes, do these new features and price point drive market share. Should more attention be made on price or should the push be on the exclusivity that B&N can add to the Nook that aren't available from Amazon. Clearly having brick and mortar stores must offer some advantages that they can capitalize on.
Currently the numbers don't look good for the Nook. "Barnes & Noble, which first unveiled the Nook last fall, has had difficulty catching up with market leader Amazon. Forrester Research estimates that by the end of this year there will be 6.1 million Amazon Kindles on the market in the U.S., but just 2.1 million Nooks and 2.2 million Sony Corp." The question to B&N remains, does this new version do enough to capture a bigger piece of the market. To me it is more than offering color. Take a page from the Apple playbook and figure out how to drive more usefulness into your product mix. A device does not run without software and content that is of value to the customer.
It is exciting to watch how far the e-book category is growing. Clearly it is the next physical media being transformed into our digital landscape. Watching the changes in TV, movies, and music, may give some hints to these players in acquiring and retaining customers.
How Should Apple Spend Its Money
Stockpickers and shareholders continue to speculate with how Apple should spend its earnings. Its top executives are cashing out their restrictive stock options and shareholders seek even more ROI. So what should Apple do? Release a dividend like Microsoft started a couple years ago. Split the shares 2:1 or more to encourage more investors to the stock and push higher the stock price. Or grow through acquisition.
Well the speculation has started. "Shares of Sony Corp rose nearly 3 percent at one point on Tuesday, but later retreated as analysts dismissed speculation that the electronics maker could be an acquisition target of Apple Inc." But if not Sony, who? Should they consider a web company like Yahoo, a CE firm like Panasonic, or perhaps Tivo. How about a content creator like NBC or CBS. Should Apple expand beyond its core strength of developing products that others can build software that Apple can resell. The App Store and iTunes are working quite well.
Apple has stated it has over 51 billion dollars in cash ready to use. But according to Steve Jobs, he is not under any urgency to spend it quickly. So far he has made all the right moves while its nearest competitor, Microsoft, has had a number of disappointments. For those that trust what Apple is doing, surely more good things will come.
Well the speculation has started. "Shares of Sony Corp rose nearly 3 percent at one point on Tuesday, but later retreated as analysts dismissed speculation that the electronics maker could be an acquisition target of Apple Inc." But if not Sony, who? Should they consider a web company like Yahoo, a CE firm like Panasonic, or perhaps Tivo. How about a content creator like NBC or CBS. Should Apple expand beyond its core strength of developing products that others can build software that Apple can resell. The App Store and iTunes are working quite well.
Apple has stated it has over 51 billion dollars in cash ready to use. But according to Steve Jobs, he is not under any urgency to spend it quickly. So far he has made all the right moves while its nearest competitor, Microsoft, has had a number of disappointments. For those that trust what Apple is doing, surely more good things will come.
Tuesday, October 26, 2010
Cablevision and Fox: Still No Deal
It is more than a week, the NLCS series is over and done and the World Series on Fox begins tomorrow night. And still no agreement. I have already heard from friends in the area; some were able to switch to FIOS and others only wish their area had FIOS. With no end in sight, a dish or antenna seems the next best solution.
In addition, the NFL Network has voiced an opinion. Not about Fox, but about their own need for binding arbitration to conclude a deal. Does any network get a break with Cablevision? The proof is in the pudding. And now the government is involve. "A senior Federal Communications Commission official wants to know whether Fox and Cablevision are negotiating in good faith or are spending all their time running attack ads against each other." To what extent the FCC can impact remains to be seen.
It may also reveal an even bigger issue between programmer and distributor. Part of the hang up is online content. Fox is a partner of Hulu and Cablevision may see Hulu as more a threat than complement. It also illustrates the challenges a Comcast-NBC deal may bring to the industry should the merger be allowed to continue.
Many want this Cablevision and Fox business to go away; unfortunately, its public airing of dirty laundry only goes to further exemplify the issues of content and distribution owned by one entity. On the surface it is about license fees; but dig a little more and it is clear the issues are far more complex.
In addition, the NFL Network has voiced an opinion. Not about Fox, but about their own need for binding arbitration to conclude a deal. Does any network get a break with Cablevision? The proof is in the pudding. And now the government is involve. "A senior Federal Communications Commission official wants to know whether Fox and Cablevision are negotiating in good faith or are spending all their time running attack ads against each other." To what extent the FCC can impact remains to be seen.
It may also reveal an even bigger issue between programmer and distributor. Part of the hang up is online content. Fox is a partner of Hulu and Cablevision may see Hulu as more a threat than complement. It also illustrates the challenges a Comcast-NBC deal may bring to the industry should the merger be allowed to continue.
Many want this Cablevision and Fox business to go away; unfortunately, its public airing of dirty laundry only goes to further exemplify the issues of content and distribution owned by one entity. On the surface it is about license fees; but dig a little more and it is clear the issues are far more complex.
Monday, October 25, 2010
Goodbye Walkman, CD Player Close Behind
Sony has finally decided to stop producing their once revolutionary cassette player. What, you thought it was already dead; me too. But the official word has just come down. "Sony has sold 220 million cassette Walkman players globally since the product's July 1979 debut that changed lifestyles by popularising music on the go." Except, I was expecting to hear that the portable CD player had also been retired. It seems cassettes have been dead for a good three years.
Sure, stores keep selling CDs but with the number of digital devices in the market place, is anyone using a portable CD player? CDs first appeared only a few years after cassette players; In the late 80's they appeared as options for cars. You would suspect that within the decade, CDs will stop being produced and all music will be sold as digital downloads. We are watching a migration from physical media to digital to eventually cloud. We will no longer physically hold onto something but access everything from the network. It is the direction we are headed or all media as we demand what we want, where we want, when we want, how we want.
Sure, stores keep selling CDs but with the number of digital devices in the market place, is anyone using a portable CD player? CDs first appeared only a few years after cassette players; In the late 80's they appeared as options for cars. You would suspect that within the decade, CDs will stop being produced and all music will be sold as digital downloads. We are watching a migration from physical media to digital to eventually cloud. We will no longer physically hold onto something but access everything from the network. It is the direction we are headed or all media as we demand what we want, where we want, when we want, how we want.
Subscribe to:
Posts (Atom)
