2ND UPDATE 2:16 PM: The NPD Group today issued a “data clarification” about its Monday press release that said its study found that streaming services are gaining while premium cable channels are losing subscribers. A day after Showtime refuted those findings, NPD Group said it should not have called our declines for HBO and Showtime.”Upon further examination of the results,” the group said in the release, “there is data supporting the conclusion that individual subscribers are either subscribing to more channels, or adding channels over time.” Here’s the full statement: “A recent press announcement from The NPD Group that was released on Monday, January 20, 2014 (‘Cord Shaving? SVOD Subscribers Increase, as Premium TV Subscribers Decline, According to The NPD Group’) should not have called out declines in subscribers for specific premium TV channels, HBO and Showtime. The data used for the press release pertains to aggregate results for all premium TV channels and does indicate that the overall number of subscribers has declined, based on a representative sample of the U.S. population. However, upon further examination of the results, there is data supporting the conclusion that individual subscribers are either subscribing to more channels, or adding channels over time. In that case, faithful premium channel subscribers are becoming more so – which would be consistent with the subscription increases being reported by individual channels.”
UPDATED 3:14 PM Tuesday: Not so fast, Showtime says. The premium channel issued a release today saying the “NPD Group ‘study’ does not accurately reflect actual subscriber counts.” Showtime says that not only has it added 1M subs in six of the past seven years, but premium rivals HBO, Cinemax and Starz also have increased subs during that period. Here’s the full statement: “Contrary to erroneous reports published this week, Showtime and every other premium network have increased both subscribers and penetrations over the last two years. A study released by the NPD Group claimed the opposite, comparing gains made by video services like Netflix to the performance of premium cable. The study does not accurately reflect actual subscriber counts. According to SNL Kagan, from March 2012 through September 2013 – the timeframe the NPD Group allegedly measured — Showtime penetration grew from 21.1 percent to 22.8 percent; HBO penetration rose from 28.2 percent to 29.2 percent; Cinemax penetration climbed from 11.2 percent to 13.6 percent and Starz penetration jumped from 19.9 percent to 22 percent. While it is true that video services like Netflix have gained, so too have premium cable channels.” Read More »
Changes are coming Monday as Disney/ABC Television Group launches its new ABC Family authenticated streaming service, limiting the 24/7 availability of streaming content and bringing the network’s multi-platform offerings in line with the nets and HBO. Effective Monday January 6, viewers will have to log into the WATCH ABC/WATCH ABC FAMILY apps, websites, or Hulu with subscriptions in order to watch the most current ABC and ABC Family streaming episodes. The WATCH ABC FAMILY app will be available on iOS and Kindle Fire devices and select Android tablets. Shows can also be accessed online at WATCHABCFAMILY.com. (The service will expand to select Android phones, Blackberry, and Windows 8 devices later this month.) After an 8-day privileged viewing window for subscription customers On Demand, WATCH ABC content will be unlocked for all users; ABC FAMILY episodes will be viewable On Demand only to verified subscribers. Cable providers offering authenticated subscriptions include Comcast, Cablevision, Cox Communications, Charter Communications, Midcontinent Communications, Verizon FiOS, Google Fiber and AT&T U-verse.
Related: Disney Brings ‘WATCH ABC’ App To Four Cities Including L.A.
The network will launch its new “WATCH ABC” live-streaming service on Tuesday during upfronts, available first to users in NY via WABC-TV and in Philadelphia via WPVI. Owner Disney launched three successful branded services last summer — WATCH Disney Channel, WATCH Disney XD, and WATCH Disney Junior — yielding nearly 15 million downloads. ABC‘s free preview hopes to follow suit, making available linear streaming of local ABC stations and on-demand full episodes of ABC programming to authenticated subscribers who can access the service online or via the WATCH app on iOS, Kindle Fire. Eventually the service will be available via Samsung Galaxy devices. The initial launch will expand to LA, Chicago, San Francisco, Houston, Raleigh-Durham, and Fresno later this summer, with 13 additional Hearst-owned ABC affiliates to follow including Boston, Pittsburgh, Kansas City and Milwaukee. The network promises full adoption across all ABC-owned station markets by the Fall broadcast season, with an ABC Family-centric version rolling out in 2014.
Cinedigm‘s Docurama distribution arm is relaunching as a multi-platform brand. Armed with a library of over 1,200 nonfiction films, the company today announced plans to screen seven feature length documentaries in theaters in consecutive one-week runs starting April 22: G-Dog (dir. Freida Mock), ¡Vivan Los Antipodas! (dir. Victor Kossakovsky), The World Before Her (dir. Nisha Pahuja), The Fruit Hunters (dir. Yung Chang), Charge (dir. Mark Neale), Ping Pong (dir. Hugh Hartford), and London: The Modern Babylon (dir. Julien Temple). 15 markets are lined up including Los Angeles, San Diego, Austin, Phoenix, Cleveland, Pittsburgh, and Ithaca.
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Netflix, Amazon Prime, and HBO may have more competition on the horizon if the popular music streaming service adds video content to its offerings. Spotify, launched in 2008, now reaches over 10 million users worldwide — 3 million of which pay monthly membership fees of $4.99 or $9.99 for on-demand music streams. Sources tell Business Insider Spotify is looking to partner on creating original content a la Netflix’s House Of Cards as it mulls the expansion into video.
Related: Can Spotify Become The iTunes Of Streaming Media?
Needham & Co analyst Laura Martin says they are — and her new report making that case should rattle media execs. Martin thinks more deeply about corporate strategy and game theory than any analyst I know. And she warns traditional content providers that streaming infotainment companies including Google, Yahoo, AOL, Microsoft and Vevo are shrewdly sneaking up on them by focusing on young people who like to watch videos on mobile devices including tablets and smartphones. The tech companies are “creating short-form premium videos that are difficult to monetize, and therefore largely ignored by incumbents,” who’d rather create hit TV shows, Martin says. The big guns have to pay attention to conventional programming: Attractive shows help to keep pay TV subscribers attached to today’s high-priced packages. “Unbundling threatens up to 50% of the total revenue of the TV ecosystem,” Martin says. But media money follows time, and as mobile devices become more popular we could see “advertising share shifts away from TV and toward the new premium-video online ecosystem.” The big producers are “fighting over the 0-2% viewing growth pie rather than the 50% viewing growth pie.” Martin says that she’d “feel better” about the long term prospects for Big Media “if they were allocating … Read More »
The phone service calls it AT&T U-verse Screen Pack, and it will cost $5 a month. Like with competitors such as Netflix — and, notably, Verizon’s new Redbox Instant — AT&T will offer unlimited, instant playback on multiple devices including tablets and smartphones. No formal word on what content will be available; the company says that it has 1,500 movie titles in the library and will include “more titles added on an ongoing basis.” Also no word on what specific operating systems and platforms will handle the streaming video. Jeff Weber, President of Content and Advertising Sales, says that AT&T “customers have told us they want subscription on demand services and we’re delivering. Screen Pack, along with our On Demand library, gives customers a flexible and more compelling movie experience, where and when they want it.” AT&T says it will offer a free preview of the service until January 13 on U-verse, Uverse.com and on the U-verse app.
Execs have thought about the idea. But Time Warner CEO Jeff Bewkes told analysts this morning that the concept of creating a subscription-based channel featuring productions from Warner Bros and HBO “is not ready for primetime.” He left the door slightly ajar, though, adding that “I don’t want to rule it out, exactly.” The problem is that his company’s shows appeal to lots of different audiences. “Comedies are different than dramas. It doesn’t make sense for us to have an all-genre network…[People] go to the Food Network expecting something different than TBS.” Besides, Time Warner already has a thriving business supplying the broadcast networks — it has at least two shows on every major one — as well as existing streaming services led by Netflix and Amazon. “We think that the better way to play it,” Bewkes says.
Related: Time Warner’s Cost Management Helps It To Beat Q3 Earnings Forecasts
Everyone interested in the potentially precedent-setting dispute between broadcasters and the fledgling Aereo streaming service will be watching what happens at the U.S. District Court in New York beginning on Wednesday. Judge Alison Nathan will hold a hearing to consider a request by broadcasters to bar Aereo from selling subscriptions while the courts determine whether it infringes on copyrights. Industry watchers are less interested in the ruling on the injunction than they are in whether Nathan provides any signals about her feelings regarding the larger argument: Is Aereo legal? The service streams local over-the-air programming to subscribers who pay $12 a month, but doesn’t pay stations a dime. Pay TV providers are privately rooting for Aereo. If it’s legal, then cable and satellite providers could introduce similar services — and tell TV stations to go to hell if they demand huge retransmission consent fees. Everyone wants an early read. RBC Capital Markets analyst David Bank says legal expects he consulted tell him that ”an Aereo victory isn’t likely, but a broadcaster victory is no slam dunk and could take years to resolve.” Broadcasters including ABC, CBS, Fox, NBC, Univision, and PBS say Aereo steals their programming without compensation. Aereo says they already give their programming away to anyone Read More »
I agree more often than not with BTIG analyst Rich Greenfield’s industry insights. So I’m surprised to see how impressed he is today with a new product that strikes me as a likely loser: Aereo. The company, backed in part by Barry Diller, just announced that it will go live in New York City on March 14. Residents willing to pay $12 a month will be able to stream signals from local over-the-air TV channels, and watch their shows on demand with the functionality of a 40-hour, dual antenna DVR. The service will only work as long as users are in the local market — not, say, if they’re on a vacation or business trip. Aereo execs expect lots of people to subscribe, perhaps in conjunction with Netflix, as a substitute for the $65 a month cable or satellite TV package. That could be revolutionary, Greenfield writes today in a blog post: “If Aereo is in fact legal, we find it hard to fathom that the traditional (pay TV) bundle will survive and that retrans payments will continue to scale as broadcasters are expecting them to over the next several years.” If he’s right, then it’s the end of the media world as we know it. The giants Read More »
Here’s more ammo for those who hold the still-controversial view that digital video services pose a major threat to conventional pay TV. Netflix says that the 20M subscribers to its streaming service in 45 countries watched more than 2B hours of movies and TV shows in last three months of 2011. That would make Netflix the 15th most popular TV network in the U.S. — ahead of FX, HGTV, and History Channel — BTIG analyst Rich Greenfield says based on his back-of-the-envelope calculations, including the reasonable assumption that the “vast majority” of the streaming subs were based here. What’s more, he figures that in homes that receive Netflix, it would be the second-most-watched TV service behind CBS. “With Netflix viewing at these levels, it simply CANNOT be all incremental” — meaning that some of it comes from people who spend less time time with traditional TV — Greenfield says. He adds that “Netflix streaming usage is exploding and is far, far bigger than traditional media executives give it credit for.” For example, he notes that Time Warner CEO Jeff Bewkes recently said that Netflix is probably the 50th most watched network. Read More »
Keep an eye on the retail colossus as the online streaming business takes shape. Walmart wants to be a player, and VUDU — the service it bought in March 2010 — provides a strong foundation. VUDU has more than 20,000 movie titles that consumers can buy online or rent for $2 for two nights. The news this morning is that the company is integrating VUDU into the popular Walmart.com website. But you can be sure that Walmart has bigger plans. Here’s the release:
SANTA CLARA, Calif. and BRISBANE, Calif., July 26, 2011 – Demonstrating its commitment to e-commerce and goal of offering customers “one continuous shopping” channel, Walmart today announced the integration of its popular movie streaming service, VUDU, on Walmart.com. Customers can now shop for thousands of digital VUDU titles, including the hottest new releases, and purchase and/or rent them directly on Walmart.com at www.walmart.com/vudu.
As customers shop for movies at Walmart.com, they now have the option to select the digital VUDU title and/or the physical title (DVD or Blu-ray Disc). Those who select the digital title complete their transaction through Walmart.com’s checkout, and then can easily stream the movie directly from Walmart.com, VUDU.com, or from one of more than 300 VUDU-enabled devices, including select HDTVs, Blu-ray Disc players and the PlayStation®3.
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Some bad news today for the cable and satellite companies that have been pooh-poohing the possibility that millions of subscribers will cut the pay TV cord. Researchers at SNL Kagan — one of the most cable-friendly forecasting firms — say they expect 12.1 million homes in 2015 will receive TV shows and movies from Internet services such as Netflix instead of a traditional pay TV provider. That would represent 10% of all households and would be up dramatically from 2.5 million cord cutting homes at the end of 2010 and 4.5 million expected at the end of this year. Although cable and satellite companies still may add pay TV subscribers, SNL Kagan says that “the pace is not expected to keep up with occupied household formation.” About 86% of all homes subscribed to pay TV in 2009 and that dropped to 84.9% last year.
UPDATE, 1:49 PM: Here’s Cablevision’s response to Viacom’s action today: “Cablevision’s agreements with programmers allow us to deliver cable television service to our customers, regardless of how many or what kinds of televisions they have in the home. Programmers are paid based on how many homes we securely connect to their content, not how many televisions display it, so they have never questioned whether a customer has a single TV or a dozen 50-inch flat panels in the home –- it’s all cable television. Optimum App for iPad simply turns the iPad into another television in the home, and one it is worth noting our customers are finding particularly enjoyable and easy to use.”
PREVIOUS, 12:49 PM: Cablevision last week quietly unveiled its own iPad app to rival one from Time Warner Cable, whose app has gotten plenty of notice because it took down a bunch of channels after companies like Viacom, Fox, Scripps and Discovery Communications filed cease-and-desist letters, arguing that the cabler doesn’t have the proper licenses to stream content for its subscribers on other platforms besides TVs. On Thursday, that spat continued: Time Warner Cable filed a suit in New York seeking a declaratory judgment to affirm rights to Viacom’s channels, and Viacom countered with a suit alleging breach of contract among other things.
But the Wall Street Journal reports today that Viacom has complained about Cablevision’s Optimum app, which streams all of the cabler’s content to its subscribers’ iPads. (So far, Optimum had only gotten guff from the regional YES Network — not a surprise, given their history with Cablevision’s former MSG Network in New York — and Major League Baseball.) “Cablevision has seized distribution rights that Viacom has not granted,” Viacom told the WSJ today. “We will take the steps necessary to ensure that Cablevision respects our rights.” Read More »
The Financial Times is reporting that Google’s YouTube site is negotiating with the Hollywood studios to participate in a pay-per-view site that will be online by year’s end. That puts it in competition with Apple, Hulu and Netflix in trying to corner the market on streaming film and TV shows. It’s an important battle because studios are reeling with the flattening of DVD titles, revenues where studios keep 80 cents of every dollar, and use that windfall to cushion all its flops. Google plans to charge about $5 for top titles. All this happens while Blockbuster prepares for bankruptcy.