Look Ma no more cable TV! Aereo + Nimble TV + Apple TV + YouTube = Cable Be Gone

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Finally consumers have choice – at least those that have the technical knowledge to take advantage. Want to get out of cable but still have cable channels plus broadcast TV? Your prescription is as follows:  Apple TV, iPhone or iPad, Aereo for $8.00 month, Nimble TV for as little as $24.95 month. No contracts, you can add a virtual DVR and then simply launch a browser on your phone or tablet, login and throw the signal through the Apple TV onto your TV. The combo of Aereo + Nimble will cost no more than $32.00 a month (unless you want more than channels than the minimum) and you’ve got TV. Cable TV channels and broadcast. But more on this in another pub shortly.

(UPDATE:  Aereo is on a roll, with plans now to bring its streaming TV service to Atlanta. The Atlanta launch is scheduled for June 17, the company announced Tuesday. The capital of Georgia will be the third city to get the Aereo service, following New York and, from Wednesday of this week, Boston.  source:  CNET. 5/15/2013

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There are really some other very cool non-cable broadcast channels coming out. I’d them term them ‘off Broadway’ TV channels. Some call them online channels. But they are as good as some cable channel programming offerings and maybe some are even better.

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YouTube’s rumored subscription-plan offering is now a reality. The video site is rolling out a pilot program that will allow “a small group of partners” to offer paid channels on YouTube, with subscription fees starting at $0.99 per month. Every channel has a 14-day free trial period, with many also offering discounted yearly rates.  Some partners include:

The Jim Henson Company is launching an ad-free channel online with full episodes of Henson’s kids and preschool titles like Sid the Science Kid and Fraggle Rock. The channel will be available for $2.99/month or $24.99/year. The company is also launching a Spanish-language channel, which will be available for $1.99/month or $17.99/year.

Sesame Street will also offer full episodes on its paid channel when it launches.

National Geographic Kids’ channelwill be available for $3.99/month or $29.99/year, offering long and short-form videos aimed at kids ages 6-12. It will include a mix of library and original content.

Acorn TV, a streaming service focusing on British classic TV programming, is also launching with a channel that’s available for $4.99/month.

B-movie film director Roger Corman will launch a paid channel this summer called Corman’s Drive-In. It will offer more than 400 feature films that have been produced or directed by Corman. These include Grand Theft Auto (Ron Howard’s directorial debut), The Cry Baby Killer (Jack Nicholson’s first film), and Fire on the Amazon (Sandra Bullock’s first film). The channel will also serve as a potential distribution outlet for new films in production. We love Roger Corman!

UFC’s channel will feature classic fights and full versions of older UFC pay-per-view events. It’s available for $5.99/month.

Then there’s Entertainment Studios, which has launched eight paid channels on YouTube, spanning a bunch of different verticals, from cars to comedy, pets, recipes, and entertainment news/pop culture. One of the eight channels, which is titled Smart TV offers “best of” programming from the other seven networks for $9.99/month.

HuffPost Live will arrive on AXS TV, a network backed by Mark Cuban, CBS, Ryan Seacrest Media, AEG, and CAA, on May 13. The interactive streaming news network will run for six hours a day, from 10am to 4pm.

Yahoo unveiled partnerships including a brilliant the deal with NBC Entertainment and Broadway Video to become the exclusive US home to all Saturday Night Live archival content, and a similar agreement with World Wrestling Entertainment (WWE).  This is especially key now that Seth Meyers is taking over for Jay Leno – the repeats should garner some heavy online traffic that advertisers should eat up.

The Cheap Life with Jeff Yeager, an original how-to show on AARP’s YouTube channel, has topped 1 million video views. The show focuses on providing tips on spending smart and enjoying life at a fraction of the usual cost.

And finally there is the Jerry Seinfeld show Comedians in Cars Getting Coffee. The meaning of something, of course, is relative. show features Seinfeld just cruising along with friends such as Seinfeld co-creator Larry DavidSeinfeld co-star Michael RichardsRicky GervaisAlec Baldwin and Colin Quinn. That covers the comedians in cars; presumably, the getting coffee part will come a bit later. The show debuts on Crackle July 19th.

All in all I’d say online programming is growing up. The cable operators will soon take notice – more than likely too late.

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The WWW and the Holy Grail

Adolph Ochs in 1896 put his slogan on a newspaper, “All the News That’s Fit to Print”. It still survives. Only just barely.

Sound arrived to movies in the late twenties, the silent-film industry and the Broadway theater industry were both broadsided. They never saw it coming. It was a running joke to them.

Radio was king for years. No one thought it would be overcome – there was a radio in every home throughout America.

radio

Then television started to gain traction in the late forties. Radio scrambled to adjust to the newer media – TV. Then, TV began to replace the radio in homes. Orders for TV sets were up 400 percent in 1949, many of them sold by the most popular shows of their time, (i.e. Milton Berle). Supply could not keep up with demand. Free television was for decades considered an American right, rabbit ears, ghosts and all.

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Then broadcast TV scrambled to adjust to newer media – cable TV. For a while during the reign of ‘Free TV’, “Pay TV” was a joke.   Americans now pay for 24/7 foreign news networks in their cable and satellite packages, news, weather, sports, movies, etc. That which used to be free on broadcast TV was no longer free.

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Then the hammer dropped for everyone. The Internet dawned, the digital revolution.  The Holy Grail of media. This was a change as great as the invention of electricity and the construction of transcontinental railroad. It was large, transformative and caused massively sweeping changes. No one was prescient enough to gauge even remotely how big this change was upon the whole planet.

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The recording industry became the first to fall in the digital pipeline. They thought by suing Napster in court they could stop their declining bottom line.  Movies and DVD’s became next to fall in.

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And then 2 large social media behemoths came along; Facebook (2004) the more social of the two and Twitter (2006) the most current up-to-the-minute form of news delivered to us not by a news anchor but by a neighbor.  Twitter made CNN, NBC, CBS, ABC, FOX ancient delivery mechanisms of news overnight.  We don’t select publications anymore, we select links.

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An ecosystem of “group journalism” in which consumers with a cell phone eyewitness reporting of the news submitted by ‘US’ rather than actual reporters in the field, changed everything. Witness Captain Sully on the Hudson river. The proliferation of the Internet made every publicly available source of information in the world openly available to everyone. This change in and of itself has altered the landscape for everyone forever. The NYT’s and CNN no longer have a lock on exclusive. Exclusive is old news – we are now the prevailing ‘exclusive’.

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Within all of this history of media, the largest companies, the ones we can name by brand have been caught sleeping by transformative change. From newspapers and magazines to Hollywood, aging media executives resistant to technology became overnight ostriches.  It was easier to take a paycheck, stick their heads in the sand then risk being ‘wrong’ about how future technology could transform their own business. Status quo was ‘safe’ harbor.  A herd of dinosaurs.

The decline and the fall of old media. It was inevitable and unavoidable. Casualties were and are in print, TV and soon cable channels. Yes, even cable TV will be falling (cord cutting: Aereo TV and Otoy). Old media will scramble to adjust just as before, but it will not be enough. The fall of old media is unavoidable.

And for us the consumer, the ‘hippie’ stage (freemium) of the Internet is over.  We will pay for more for media then ever before – not in print but whatever form it comes in. The trees will love us once again. However, the cost for this will be higher than it once was.  What is less talked about are the adjustments that consumers have to make. Paying for media that was free or easy to access is now the norm.

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And still only 65% of the country has broadband Internet access. What Google fiber offers is just a beginning and will become the norm. Google fiber speeds will knock cable TV off its legs.  We wont need coaxial cable – just access to the Internet.  And it won’t have to be coming from the white coaxial cable coming into your home – it will be wireless.   TV channels will be become specific apps downloaded on a phone or tablet.  Bundles will be forgotten. The ‘triple play’ of a phone, cable and the internet that we all familiar with for $ 150.-200 a month will soon be broken down.

Perhaps even the app store will disappear too. The potential disruptiveness of Otoy (http://goo.gl/aQZSl ), as a breakthrough streaming service could, in the near future, could end the need for app stores and computer upgrades.

Advertising will never ever again subsidize any old-media news organizations in the style to which they (and their audiences) have been accustomed.

News organizations used to be able to overcharge and under-deliver in their deals with advertisers; the pizza place and the car dealership had nowhere else to go, and no one knew how many people saw, or acted on, a given ad anyway.  Not anymore. Nielsen, one of the old guards struggles to stay relevant – even if they purport to have new measuring technology. There are at least the 10 other companies who are in the process of eating their lunch.

We are in for years of re-adjustment. Transformation from print and paper to digital – cable TV to Internet TV, YouTube, social apps and the like. Consumer adjustment will take time. But less than you think. Our kids are growing up ignoring cable and television, without radio and traditional print media. The norm:  downloading of apps, mobile phones, tablets and no desktop computers. It’s different and disconcerting for the parents. It’s happened before – it just happened without the Internet. How we used to do things in the seventies, eighties, and nineties is no more – change is good.  Breath in – breath out.

The Unraveling of Television

Much has been written lately about the unbundling of cable TV. But its more than that. Way more.  First, a little history. In 1933 RCA introduced an improved camera tube and this was dubbed the ‘Iconoscope’. In 1941, the United States implemented 525-line television.  By 1947, when there were 40 million radios in the U.S., there were about 44,000 television sets (with probably 30,000 in the New York area). Commercial color television broadcasts began on CBS in 1951.

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Here is where it really gets interesting. In 1951, TV broadcasting was free. Nobody was paid for the use of any content.  In 1957, 25 million Americans watched the broadcast of a musical version of Cinderella. Executives in Hollywood calculated that if they had received a fee of $0.25 per TV set/viewer, they would have netted $6m in one day without any distribution costs.

 

The first basic cable network, launched via satellite in 1976.  That was Ted Turner’s superstation WTCG in Atlanta. Cable is often divided between basic and Pay TV. Basic cable networks receive at least some funding through “per-subscriber fees,” fees paid by the cable TV systems for the right to include the television network in its channel lineup. The fees that the ‘basic’ channels charge have grown and increased almost every year. The size of these fees varies widely. ESPN gets $5.54 per subscriber a month (from each and every cable system that carries ESPN), while Viacom’s MTV gets 41 cents per subscriber. Niche channels get much less. MTV Hits, for instance, gets two cents. The big 4 ‘broadcast’ networks get ‘re-transmission’ fees. CBS expects to get over $ 1b in fees over the next few years alone.  Ironically, cable television in the United States in its first twenty-four years was used almost exclusively to relay over-the-air commercial broadcasting television channels to remote and inaccessible areas.

 

So, cable operators faced with increasing fees every year had to ‘bundle’ channels together into ‘packages’. Which is what we all now have. The question is whether a full ‘a-la-carte’ offering to consumers would be a dream or a disaster for the cable TV industry. I am not attempting to draw any conclusions here one-way or the other.

With this debate going on along comes a service that really begins to make it look like 1951 all over again. And this time its not broadcast or cable, instead its carried over the internet. And that makes it all the more pervasive and certainly disruptive.

 

Enter Barry Diller’s ‘Aereo’ TV. For $8 to $12. a month, you get over 30 channels of programming, including ABC, CBS, NBC, FOX, PBS, movie channels (ION, etc.) Spanish and Asian language programming and even something for the kids, PBS KIDS (which has some excellent shows – move over Nick Jr.). You can record a program while watching another . You don’t even need a physical DVR box, your show is saved online in the ‘cloud’. There are no cables, no antennas and no set-top boxes – nothing, nada. The only thing you need is Internet connectivity. Must you watch it on line? Nope.  If you’ve got an Apple TV or Roku or any Internet connected TV, you’re all set.  Add Netflix or Amazon Prime and you’ve got new movies, VOD and pay-tv programming. Do I really need cable TV too?

 

Aereo is being sued big time by plenty of broadcasters. Its only in NYC right now but in about a month or so, 22 more major cites around the country will offer it.  So, will this cause many people to disconnect their cable TV? Will this prompt the operators to un-bundle everything. Is this the ‘cord cutter’ that’s been talked about for some time now ? I for one would disconnect my cable TV. I hardly watch it. I do want to see the 4 main broadcast networks and have some programming for the kids. Aereo provides this.

 

The unraveling of television has only just begun. Stay tuned.

Confusion Reigns Supreme with Online Movie and TV Streaming Services. Consumers are the losers.

Confusion           caution-mass-confusion  220px-Aereo_logo netflix-appletv   streamingmedia

Recent shifts in technology due to the Internet have destroyed the profitability of several industries including the newspaper and music businesses. The next business that will be made over by technology is television. The profitability of owning TV networks is being undermined by digital video recorders, internet-enabled on-demand viewing, Netflix, Hulu, YouTube, and piracy/theft.  In this post, I’m going to list many if not all of these choices currently available to you and me – and there are WAY TOO MANY. And a lot of amateur content is taking up an increasing portion of a viewers’ time online and on mobile/tablet devices. You Tube has how many new original channels?  I mean unless you’ve got absolutely nothing to do 24hrs a day other than veg in front of a computer and or TV, you can’t ingest even 10% of this content.

Consumption of network and cable content is taking place in ways that allow viewers to circumvent high monthly cable bills, avoid watching commercials, or both. The new Barry Diller backed ‘Aereo’ – https://www.aereo.com/ will indeed disrupt cable and pay-tv as never before. Every single one of these changes represents a move to a revenue model that is less profitable than the one currently enjoyed by the TV networks. It is simply a matter of time before the revenue and profitability of the major networks begins to fall seriously erode.

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Consumers are awash with the plethora choices of streaming movie services, VOD and TV/time shifting programming (between 30 to 40 and counting). There are so many choices that I defy anyone to tell me exactly what they are buying and what each of them offer, specifically how tey are different. Anand Subramanian of startup NimbleTV was even more blunt. “There’s content everywhere. It’s a mess. It’s a total mess for consumers.”

Hollywood-sign-900Hollywood releases maybe 10-12 ‘big’ picture events every year and all of the releases are timed by Holidays (Thanksgiving/Christmas, July 4th, Memorial Day, Halloween, and Labor Day weekends). Independent movies are released around these times and are scattered throughout the year.  Years back when DVD’s were released, those releases in the stores reinforced the theatrical releases with a barrage of marketing. You saw the same big pictures being marketed again in 6-9 months after the theaters. So, when you went to Blockbuster you had a ‘a-ha’ moment. You’d say, oh yeah, I remember that movie, I missed it at the theaters and you would rent it. It was pretty clear what you saw,  what you missed and what you wanted to see again. Then, HBO and Showtime would re-market the same movies in their PAY-TV window approximately 10-12 months after the theaters.  They’d remain there for 24-36 months sometimes even longer.

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When Pay-TV was in its heyday, there was a ‘pay’ content war between HBO and Showtime. Some studios had exclusives with HBO, some with Showtime. To the average consumer, this didn’t mean all too much.  No one wanted to watch a Paramount movie, they wanted to see ‘Fatal Attraction’.  Maybe with the exception of which pay-tv service had Disney movies (if you had kids).  Now, that doesn’t really matter too much as kids watch gobs of shows on basic, Nick Jr., etc.  Over the years, HBO got wise and supplemented its schedule with well produced original programming and still is. Showtime followed with its original programming and both duked it out with Sports, specifically Boxing.

Time shift forward, now it’s a war between Netflix and HBO.

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Its not HBO and Showtime, but Netflix – http://goo.gl/0N2No . And its not only Netflix, it Amazon Prime, Hulu plus, iTunes and a myriad of other streaming offerings.  I’ve compiled a list below. But the bottom line is how does anyone really understand what they are buying? If you subscribe to Netflix, can I see Disney movies? Will I get mega-hit from Universal like Jurassic Park, Les Miserables, and Despicable Me Part 2? Or do I need to subscribe to several streaming services? And, which ones?

And down the road very soon Barry Diller’s back Aereo TV will expand to 22 cities – https://www.aereo.com/. Why is this disruptive if it only offers ABC, CBS and NBC as the primary driver of the service? (more on this later).

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Here is the list ( I hope I’ve got most included). I’ll admit I am confused as everyone else and I’m not going to buy or subscribe to more than one service especially when I don’t even know that if I do, I’ve essentially duplicated the movies and content I’ve subscribed to.

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Hallmark Instant Streaming – coming Spring 2013

Amazon Prime Instant Video – The Prime Instant Video library consists of over 30,000 movies and TV episodes, which can be watched via any device the streaming service is available on, including the Kindle Fire, iOS devices, Roku, Xbox 360, PS3, and the Wii U.

iTunes

Netflix

Redbox Instant (Verizon)

Redbox in Stores – Physical DVD rentals

Roku

Boxee

CinemaNow – Best Buy’s service plus

Hulu +  – Hulu now has more than 430 content partners, offering over 60,000 TV episodes, 2,300 TV series, and 50,000 hours of total video

NimbleTV – Just like Aereo (Barry Diller venture)

Motive TV – Like Nimble and Aereo from the U.K. heading to the US

Aereo – Just like Nimble TV

Ultraviolet – Studio driven answer. Welcome to DRM land.

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Crackle – SONY/Columbia Pictures

Vudu

RedBox (physical rental)

Kaleidescape

Sony Pictures Gift Store – more SONY choices

Flixster – Gateway to itunes, amazon and vudu

IndieFlix

Popcornflix

Cable Operators VOD library ( Time-Warner 4,000 movies + Comcast, Cox, etc.)

OnDemand via cable

Microsoft’s X-Box – a Gateway to Netflix + others.

Comcast’s Xfinity – Over 10,000 VOD movies (lots of NBC/Universal content)

Starz Play

Encore Play

MoviePlex Play –  Starz Play currently offers approximately 400 film and TV titles, including 300 movies and 100 episodes of Starz original series. Encore Play offers about 900 monthly selections, while MoviePlex provides access to 200 more movies every month.

AvailTVN_LogoAvail-TVN’s View Now – ViewNow’s library of movie content includes titles from both major and independent studios, which can be delivered in MPEG-2 and MPEG-4, as well as a range of adaptive bitrate (ABR) formats, to traditional set-tops as well as internet-connected devices like PCs, smartphones, and tablets. In addition to multiplatform rights, Avail-TVN says ViewNow includes download rights on a large number of titles.

M-GoM-Go – new app that elegantly streamlines all of your media together in one place including movies, music, TV and more. Formed in 2011, M-GO is a dynamic well-funded startup sprung from the cooperation of Technicolor and DreamWorks Animation. The M-GO app will be available for download for free on all major operating systems. M-GO is preloaded on 2012 Samsung and Vizio Smart TV and Blu-ray players as well as Intel Ultrabooks, totaling up to 30 million installed devices.

Watch ESPN is now available on Amazon’s Kindle Fire and Kindle Fire HD devices. Free to download via the Amazon Appstore, the TV Everywhere app offers access to live sports and channel programming from ESPN, ESPN2, ESPNU, and ESPN3, as well as ESPN Goal Line/Buzzer Beater when in season. As is the case with other WatchESPN editions as well as other TV Everywhere services, to access the content the viewer needs to first have ESPN in their TV subscription package. In conjunction with announcing the Kindle Fire app release, ESPN also revealed some end-of-the-year numbers on how WatchESPN is faring in terms of distribution and availability. The sports network says that total downloads for the WatchESPN app, which is now available in the App Store, Google Play, and the Amazon Appstore, more than doubled in 2012. It’s now available in 46 million households nationwide as six of the top 10 cable distributors also provide access to the service.

epix-hd-logo1EPIX plans to launch a streaming app for the PlayStation 3 during the first quarter of 2013, followed by an app for the portable PlayStation Vita console sometime in the spring. The apps will offer more than 3,000 titles, including blockbusters such as The Hunger Games, Thor, and Mission Impossible: Ghost Protocol, as well as EPIX’s lineup of original programming, which features music concert, comedy, and sports events. The apps will be available to PlayStation Network members in the US as a free download. Users will need to authenticate their EPIX TV subscription in order to watch the content.

Now about Aereo.  One of the things we all get cable for whether you realize it or not is to receive the 3 main Broadcast Networks, ABC, CBS and NBC. These are on basic cable in 100% of all cable systems nationwide. And basic cable costs at least $ 50-70 a month and 9 times out of 10 its bundled with pay-TV and a phone land line along with internet access bringing your bill to over $ 100 a month.  And generally, one has a Netflix or Amazon Prime subscription (or another streaming movie service).  There are 2 kinds of camps here or cable subscribers, one with kids and the others without kids. For the people without kids, Aereo + 1 streaming movie service (unless you are a sports nut and MUST have ESPN) would be sufficient. You’d have local broadcast TV and all the movies you could watch/stream. What else do you really need (unless you must watch ‘Honey Boo-Boo’ and then I can’t help you). For the families with kids, this is slightly age dependent. Its hard when you have toddlers NOT to want to get several of Viacom’s Kids channels or Disney’s kids channels (Nick, Nick Jr., Disney Channel, Disney Jr., etc. )  If you have older kids, teens etc. a movie streaming service with Hulu + might suffice.  For those without kids, Aereo + a movie streaming service will drastically cut your bill. Aereo I believe will charge about $ 9.00 a month, no subscription or early termination fee (take that Cox, Comcast, Time-Warner and Fios). Maybe with Amazon Prime or Netflix and your looking at under $ 20.00 a month. Yes, you will need internet access so add another $40-60.00 a month depending on your need for speed. But its definitely less than the typical bundled services. If you don’t think that Aereo has Pay-TV in its crosshairs, you’re crazy. We shall see how this unfolds as it winds its way through the courts. Yes, Aereo is being sued by the broadcasters and others, but it’s also rolling out its service nationwide this spring. I am signing up to see what its like – but it seems like an idea whose time has arrived

Television is no longer TV, its IP!

The old generation networks: ABC, NBC, CBS and FOX. The new-generation networks?  Hulu Plus, Amazon Instant video, Netflix and YouTube.

Consider this:  Microsoft recently reported that Xbox 360 owners spend more time online watching video and listening to music than playing games. The company announced 35 new entertainment partners being added to the Xbox 360 in the next year, including the NBA, NHL, Nickelodeon, and Univision. ESPN is expanding its programming on the Xbox to include live feeds of all of its channels. Microsoft is also launching a music service to compete with iTunes.

                

The Wii U, debuting this fourth quarter, will also feature Netflix, YouTube, Hulu Plus, and Amazon Instant Video.

And, Outside of games, the PlayStation Network also now delivers access to streaming content from Hulu Plus, Cinema Now, Amazon Instant Video, Netflix, NFL Sunday Ticket, NHL Game Center Live,  MLB.TV,  ESPN and Crackle TV, while users will soon have access to YouTube from the PlayStation Vita.

You’ve got wonder, how will Nielsen ever be able to count the eyeballs watching? At this point, they can’t. They are the ‘dinosaur’ technology.

When my Mom and Dad had breakfast in the mornings, they would pass the newspaper back and forth. Back then, I looked at the classifieds for things to buy second hand and they even had a classified section in most magazines and papers for the ‘personals’. Wanted to go the movies (you know the movie we saw ‘advertised’ by trailer last night during a network show on CBS, say Ed Sullivan or Mary Tyler Moore), we checked the newspaper.  Real estate listings and needed to buy a used car? Newspapers.

               

Fast forward 15 years. Now we check our mobile phones for movie trailers and times. Dating? Not in the newspapers, on mobile or a laptop or tablet. News? Forget the paper. And for many years, the papers were in denial – they kept printing tons of papers, special sections, extra editions and even tried to launch new newspapers in certain cities to compete with the entrenched and big local guys. They lost millions of dollars and saw their stock price get hammered and many folded. The bigger ones put up paywalls (i.e. NYT’s, WSJ, etc.)

Then the music CD died and the way music was listened to and purchased changed. No one could believe that there wasn’t going to be any more music CD’s nonetheless a Tower Records or Wherehouse to close their doors. But they did. And the CD has all but disappeared.

Movies? Same thing is happening and will happen. It may take longer because of the nature of the medium. Movies are different than music in that the files are way larger and with music you listen to ‘Hotel California’ or your favorite music many times over and over. Movies? How many times can you watch the same movie over and over. However, Blockbuster and stores like them are disappearing. Replaced by iTunes, RedBox, (and RedBox I believe has a limited life span even though they are going gang-busters today), Amazon Instant Prime, YouTube, IMDB (yes you can buy movies and stream them there too) and many others.  Even Wal-Mart is in the mix (Ultraviolet and VUDU).

In my generation and others behind me, its what you owned and had that was important. Today, its how you access it. No ownership. No physical ownership that is. Its just not important. When and how you get it, is.

The final frontier is the television. And it’s a big frontier. And, there is more at stake than a plastic CD in a rectangular box that will disappear. Advertisers and the big 4 networks stand to lose the most. Including producers, writers, actors and the like. Add a DVR into the mix and the new choices that the younger generation has now and you’ve got a real problem CBS, NBC, ABC and FOX.  The upfront TV buying season which some estimate generates $19 billion fuels most everything we see on TV. About $9.5 billion for network and $ 9.9 billion for cable.

Network estimates individually for 2012-2013 season are:

  • CBS: $2.92 billion,
  • ABC: $2.65 b,
  • Fox: $2.15 b,
  • NBC: $1.78 b.

So, when Game consoles, tablet makers, mobile phones and the like are all putting mainstream content up and online for consumption, someone stands to lose. Another way of thinking about this would really be a shift of dollars from Network and Cable to third screens. It won’t disappear but in ten years it’s going to look awfully different than it does today. And the way all of this is counted and rated will actually become easier than how Nielsen has done this for decades ( a diary that you write in? Really?).

A new report from Nielsen, the TV audience ratings and measurement people, shows that the number of people who watched TV at least once per month—a pretty low bar—declined from 90 percent of the population to 83 percent last year.

Proportionately, that means TV lost 8.5 percent of its audience in 2011. As many as 17 percent of people never watch TV, the survey of 28,000 consumers in 56 countries.

That’s a huge loss of interest in a medium that in industrialized nations is regarded as a standard like electricity or hot running water.

The number of people watching video on a computer at least once per month is now higher, at 84 percent, than those watching TV.  The implications are obvious.  Some not so obvious. One is that cable affiliates pay big fees to Networks for carriage. If no one is watching, no one will be paying. And, younger kids don’t care what ‘network’ its on, they care when it will be available to see on Netflix or Hulu Plus. A real shift in economics and habits. And I don’t think the TV industry is paying attention. But they will, they will have to.

Welcome to the new world of multi-screens and time shifting. TV as we once knew it not TV, its IPTV.

A Train Wreck Indeed!

How do you f’up the pay-per-view business? You don’t. No need to – it has been one train wreck since 1984. (Full disclosure: In 1984, I started a nationwide satellite delivered ‘A’ title Movie service called’ The People’s Choice’ alongside of Jeff Reiss’s ‘RequestTelevision’ and Scott Kurnit’s ‘Viewers Choice’). When I was in this business, Bill Mechanic (ex-CEO, Chairman of Fox, Disney, green lit ‘Titanic’) and Barry Diller were at Paramount, Jamie Kellner ( Orion Pictures who went on to run ‘The WB Network’), Hal Richardson ( President at Paramount) was at Disney/Dreamworks, Eric Frankel (President for 26yrs) and Stanley Solson along with Eddie Blier were at Warner Bros. ( close to the Steve Ross reign whom I knew well from High School days), Mike Medavoy at Tri-Star, Ned Nalle at Universal and Andy Kaplan at Sony. Most all of these people now still are around and are running their own ship BECAUSE back then, they had a some foresight and moxie. They DID agree to let the PPV at least try and get off the ground by granting PPV rights to a few nascent, early entrants in the business. At that time, there were only a few addressable homes to see the films.

Since the inception of PPV on the cable landscape, its always been a ‘promise’ business at best. Nothing really ever took off or was unbelievably successful (and I am referring to MOVIES, not the WWF, Boxing or the Adult business). Many a business and consulting firm was built around it, hardware made for it, ordering systems invented and manufactured and in the end, most went out of business. Most cable operators didn’t even understand it or what it was suppose to be, what ‘tier’ to put it on and how to promote it. Most felt it would cannibalize their existing cash cow, PAY TV.

It never cannibalized anything because it never got off the ground. No one could agree on a movie PPV ‘window’ (the timing of when a PPV movie should be allowed to be seen and ordered on PPV). Many a conference, discussion group, speech and convention sessions were had – all futile. Nothing was ever decided. The VCR’s were blamed as the culprit, then it was the movie studios, then it was theater owners, then it was Pay TV and the ‘exclusivity’ wars of the 90’s. Then the Internet crept upon us all and that was the new Darth Vadar. You can’t release a film on PPV too early because it could be copied easily and even easier become distributed by means of the internet all over the planet (meaning no more duplicating and bicycling cassettes as if my friends ever did this in mass to begin with). Now, using the Internet, movies would be all over the place, everywhere. Everyone would have a copy. Well? Do we ALL have copies of Avatar? Tootsie? As Good As It Gets? Dirty Harry? A good industry has got to know its limitations! And this one never did!

Now, theater owners are afraid of the 60 day release window. Pahleeese! Just read a few of the articles below.

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Theater owners and the Hollywood creative community are livid about Premium VOD, which they perceive as paving the road to cannibalizing theatrical attendance which would in turn harm a movie’s overall economics, creating a dangerous downward spiral. In addition, there’s concern that if consumers switch to watching movies on the small screen then the creative license implicit in a big screen emphasis will get squeezed. While their concerns MAY be justified, the good news for them is that Premium VOD will be lucky to achieve even minimal success.

Why? The cost is one – $ 30.00 for a poor film or film that has not done well at the theater or is released directly to DVD (or what was once called DVD) is insane. Sorry, justification by babysitter fees and popcorn costs don’t cut it. These are niche films. Avatar and other BIG films will never see this light of day through this window. But ‘Cloudy with a Chance of Meatballs ‘ will (and has already, sort of). Example – first film up is Just Go With It” starring Adam Sandler and Jennifer Aniston. Ho-hum. Good cast and a flop a the box office for the most part. I’d be pissed if I paid $30.00 for this AND CAN’T EVEN KEEP A COPY IN A DIGITAL LOCKER TO SEE WHEN I WANTED AGAIN? WTF? And frankly that could be one of the keys to making this viable. Give me the ability to KEEP it as if I bought the DVD ( keep it in a ‘cloud’ locker) and I’d might buy a few films – that would help at least justify the cost.

And, as Will Richmond from VideoNuze so aptly points out, “Studios seem to believe that making movies available sooner in the home will attract demand. But the problem is that there are already so many choices for watching movies in the home – pay-TV, Netflix, iTunes, Amazon, Vudu, etc. etc., that it will be very hard to break through the noise, solely with a “sooner” positioning, which is more than offset by a ridiculously high price point. Consumers are savvier than ever; they’ll quickly realize that they can get the same movie for $4-5, a sixth to a seventh the price of Premium VOD, just by waiting a couple more months for it to appear on pay-TV or online VOD.”

So, theater owners who vow to ‘go to war’ are wasting their time and efforts. I guarantee them that the Movie studios and cable operators and satellite delivery services will win the war for them. Somehow, these guys think that consumers are not too smart. When are they going to wake up and smell the coffee? When are they going to realize that all of us don’t rush to ‘steal’ digital copies of films for any number of reasons (i.e., they are 700megs of data AT LEAST, cumbersome to store, less than perfect copies that lack subtitles at times and extra’s.) They are not MP3’s! Music and movies may both have a digital base as a common denominator but ultimately I’ll listen to Hotel California many more times than I can watch Avatar in my lifetime. And the pirates don’t make a bit of difference except barely on the streets of lower Manhattan or Tokyo where poorly made copies sell for $5.00 until those vendors get caught that day. And they on sell about 30 movies at that point – no MASS market like that that would ruin a $250m box office in the theaters or in any ancillary market I know of.

Theater owners should rejoice that soon this whole business will be in Netflix’s (or some other digital distributors) capable hands and not the studios. (Apologies to those friends of mine at the studios now – its not your fault, it’s just the ‘economics’ to blame and perhaps a few at the top thinking we are still in the DVD/VCR age). Make the business consumer friendly – give us a copy of what we buy and allow us to watch it whenever we want for our money that we spent. After all, I can do this with new music released, why not new movies released?

The Day the Studios and Theaters Stood Still

Sometime in the near future there will be an explosion heard only in the entertainment trades and whispered and talked about between studios, marketing executives,  theater owners and DVD retailers. The FCC gave everyone permission to enter this pissing match and what a pissing match it will be.

If you ever go to the movies (and many of us do) with more than 1 person – so two people attend a film and you have a child where you needed to hire a sitter, you might not be going to the theater so quickly anymore. Well, maybe you still will. Time will tell this one. Soon, a mere 6 weeks AFTER any movie starts playing in a theater, you will be able to watch it at home in the comfort of your ‘Aunt Fay’s couch’ (nod to Steely Dan) on your nice large LCD flat panel TV.  To help you To help you visualize what this means in numbers, there are about 115 million television households in the US. Approximately 100 million of them are currently cable, satellite or IPTV subscribers. Through these cable boxes (although not every one of them, only the ‘digital’ households that have a set-top box) you will be able to purchase the very same film that was JUST in the theaters 6 weeks ago on cable for $24.99 – called premium V.O.D. – video-on-demand.  BUT, the movie studios will be able to activate a technology to prevent films sold through video-on-demand cable systems from being copied.  This is the ruling that the FCC just allowed in May 2010 after a two year battle with the studios.

Right now, theaters get an exclusive period — 120 days (4 months vs. 6 weeks), on average — to serve up new movies. Then the releases appear on television video-on-demand services at a price of about $4.99. Now the studios want to offer us new movies on video-on-demand services about 45 days after they arrive in theaters.  But, you can’t keep a copy or make a copy (your DVR, VHS or whatever won’t work). Just like a theater, once its over, its over.

So, if you are more than 2 people (+ a baby sitter), and unless you are dying to see the film on a BIG screen, I guess you might wait a few weeks.

So, what’s the big deal? For starters, the theater owners, have made it clear that releasing a movie early on video-on-demand services — thus cutting into their window — would be the equivalent of declaring war. They feel people will be more reluctant to buy movie tickets, at an average cost of almost $8, if they know they can catch the same film just a few weeks later in their living rooms, and for less money than it costs to haul the whole family to the theater. The average moviegoer spends more than $3 on popcorn and soda and the like, the cost of Friday night at the movies for a family of four can easily reach $45 – $60 — or much more in cities like New York and California.   And theater owners say this doesn’t take into account second-run and discount theaters, and that there are big exceptions: “Inception,” for instance, was still raking in millions in theaters 10 weeks after its release.

Next up, DVD retailers are fuming – Best Buy and Wal-Mart have told the studios they will retaliate against anyone who tries early-release V.O.D. because of the threat it poses to DVD sales. Huh, what DVD sales? The DVD is going the way of the CD in case anyone hasn’t noticed. Blockbuster just filed for bankruptcy. DVD sales for the year are expected to total about $9.9 billion, down 30 percent from their peak in 2004  (about $13 billion), according to Adams Media Research.

Who is the big winner here? The Studios (or so they think) because as much as 80 percent of that early V.O.D. revenue goes to them, therefore movie executives see a new way to compensate for their dwindling DVD business. And the studios are aware that consumers are growing impatient about being unable to access all movies whenever and wherever they want. An early video-on-demand option might prevent some of those frustrated customers from turning to pirated copies.

So where’s the flaw in this plan? I have a couple of thoughts. First of all, the pay-per-view business has been an anemic business since its inception on cable in 1984 when Request TV, Viewers Choice and The People’s Choice (yes, this was my company back then). Part of the problems was with the windows given to PPV movies, part was the terrible job the cable operators did to market these films to us, part was the billing mechanism (it was archaic) and part was the fact that the VHS back then and soon the DVD was simply an easier option. Not to mention you could rent the same film on VHS/DVD so much earlier than on PPV and then buy a copy to own, to watch again and again.  Second problem is that you can’t keep a copy of what you fork out $24.99 for. This just begs for pirates to hack the system (and it will happen and supposedly already has). So forget the studios argument that an early video-on-demand option might prevent some of those frustrated customers from turning to pirated copies.  Maybe at first, but I have no doubt pirated copies will turn up on the streets all the same – now just earlier and better quality DVD copies.

The fact you can’t keep a copy is just self-defeating. Instead, what the studios SHOULD be doing is giving everyone a ‘cloud’ storage locker for say, $ 10.00-20.00 a year. Once you pay $24.99, the film goes straight to your locker. Then, its kept there to be watched as many times as you want for as long as you keep the locker subscription current each year. Sure, pirated copies will still happen but there is a much better chance that people will be more willing to pay the $24.99 IF they can watch it over again, anytime, and on any ‘authorized’ device you own (i.e. mobile phone, Galaxy ‘Tab’, iPad, etc).  Apple does great job with ‘authorized’ devices and computers.

I’m sure a studio would say ‘well, then your friends can come over and see the same film without paying for it because its in your locker’. Well, its in YOUR locker, not theirs and they can come over anyway under the present scenario. And this is the same ridiculous argument studio exec’s made in the early years of the PPV business.  It didn’t stop anyone back then and only help stifle the PPV business – a misjudgment they appear are doomed to repeat once again.  Will they ever learn from past mistakes?

So, will you pay $24.99 to watch a film at home you can only see one time?  You might if it’s a title you don’t really care to much to see in the theaters. Would you have seen Avatar that way?  NOT ME!

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Steve Jobs said “They want Hollywood movies and TV shows whenever they want them,” went his description of consumers’ wants. “They don’t want amateur hour.”

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I couldn’t agree more. Asking consumers to put out ANY cash for ‘clips’ on youtube and the like is indeed amateur hour. Not that we don’t want to watch an occasional youtube clip ( I have a laptop for that), but not while we can see ‘The Expendables’ streamed to my flat screen TV day and date with DVD. Goodbye plastic DVD via Apple TV.

Doesn’t this smell like the the death of the DVD – reminiscent of the music CD ?  It does to me.

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Can cable TV keep its ‘teflon’ coat afloat?

Cable TV. Its been resilient during the recession. Almost like Teflon. Will online video providers emerge as direct competitors or complements to the $69.8 billion U.S. TV subscription market?  If over 88% of all the full-length TV program episodes available in the $10/mo subscription service are already freely accessible on Hulu.com. For clips, it’s almost 98%, then why would I buy a subscription to Hulu +?  “Online video is not a substitute” for multichannel video programming, Comcast recently wrote in a filing to the FCC responding to complaints from competitors this month. “In addition, several impediments – technological, pricing related, and rights related – make it highly unlikely that online video will become a substitute” for such service “in the foreseeable future,” it continued.

So is cable really safe? Today, Google announced that it will jump into the pay-per-view market, via YouTube. Newer film titles would cost about $5–a bit more than the $.99 to $3.99 YouTube charges for the older films currently available in its fledgling pay-per-view catalog. Presumably, there will be some sort of integration with Google’s forthcoming Google TV platform, though details are scant.  If the company does manage to roll such a service out, we’ll soon see YouTube going head-to-head with Apple’s (AAPL) iTunes, Netflix (NFLX) and Hulu–and in a big way.

Yes, Google’s got reach and numbers. Yes, they could market this probably better than most. But the cable TV business has been in this market for years. And they are terrible at marketing the service and always have been. Part of the problem has been a rights issue with Hollywood (the old ‘day and date’ issue with DVD releases). Day and date issue won’t go away either, in part because Red Box is putting too much $$ into the studios pockets and it a hedge against Netflix. However, Netflix is also putting a lot of $$ in the same pockets. And, most of us still prefer the large flat screen TV over a laptop screen any day. But one of the most fervent and least discussed impediments happens to be pay TV. The likes of HBO and they swing a very big stick. HBO gets rights to movies, and BIG titles, for many, many years. Its the ‘pay-tv’ window that keeps coming back and back and back. You see HBO has 41+ million, HBO and Cinemax U.S. subscribers (as of December 31, 2009).  At an average subscription fee of $12.00 per month, that $492,000,000 million dollars PER MONTH in subscription fees. Yes, part of that goes to the cable ops for carriage, but thats still a BIG number. So, when HBO goes shopping for films and locks up movies, it does so for years. AND, those rights prevent many forms of PPV exposure, both online and terrestrial.

Which bring me back to cable TV as a whole.  I recently disconnected 3 out of 4 HD boxes in my home and got rid of my last ‘extra’ tier. I have kids in the home, so luckily Nick Jr. and Disney for Kids is carried on plain the old basic tier (are you listening cable operators?). Had those two channels been on a tier that I would have to pay for, guess what? I would be buying that tier. Other than that, ABC, NBC, CBS and Fox are the most valuable channels to me. Why? I can’t rent tonight’s Network Television programs. I might be able to see some of them online but I’m back to my computer screen for that.  The Emmy’s, Football, Baseball, The Academy Awards, local news and network news and other programs of this sort we all get for free – today. And its all delivered over cable TV.

Until I am able to transmit an online URL to my flat screen TV, Hulu +, Netflix, Google TV,  Apple TV and the rest are not compelling enough to pay…$5.00 a movie or $ 10.00 a month on top of my basic cable subscription.  So, yes, cable TV is fairly resistant to the recession and ‘online’ competition today. My guess is that Steve Jobs will announce a ‘rental’ service for Apple TV. And yes, others will come. But for today, cable is king.

And please don’t move Disney for Kids and Nick Jr. to another tier!

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Will TV last as it is today in its present form?

What’s going to happen when we can watch anything on-line we see on TV today or in the theaters instantly on-line (and that image is delivered to your living room or any TV) ? What happens to the ‘per subscriber’ guarantees that programmers pay cable ops to carry their satellite feed? And when I can get CNN for free on-line instantly via the Internet? Or Noggin? Or Lifetime? Or Disney? Right now I subscribe to Time Warner – I get about 150 channels. I think we watch the following: 3 ‘local’ channels (ABC, NBC and CBS), Lifetime (wife), Noggin and Boom (daughter) and ESPN and an occasional HBO movie. That’s 8 channels. If I pushed that I can probably include several others like Turner Classic Films, AMC and Discovery. But not too many beyond that.

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Since I can remember, cable companies have controlled what I watch and when I watched it. If a cable op. didn’t like the a channel, it wouldn’t carry it and we couldn’t see it. We were in a closed, 4 wall environment. We are still in that environment, but the walls are coming down. Very slowly. And the big three TV guys are in total denial. They are programming like its still 1999.

In this new world of ‘TVnomics’, I no longer need to hope that my cable operator will carry a particular program. With the likes of Hulu, YouTube, TV.com, and a few other content aggregators, I’m no longer tethered forever to Time-Warner. Using Amazon or Netflix I can watch on-line nearly anything I can find on my Time-Warner delivered TV service. And this has only really been possible since approximately 2 yrs. and 3 months ago (May, 2008) when Hulu launched.

So we have been seeing very ‘non-traditional’ programming hawking itself as a TV show for the web. Shows on no budgets, small ones and even big one. Some of these shows are being pushed out to the web by the networks (trying to find some viewer traction), and some by independent suppliers. All of them for the most part are sub-par and relatively few advertisers have climbed aboard.

Instead, the networks think that if they tease the traditional TV audience they have with bits and snippets of content found on TV pushed onto the web, they can have TV on the web or call it ‘Web TV’. Why in the world don’t CBS, NBC or ABC stream this ‘live’ simultaneously with broadcast? Why can’t they put the same show and advertisers on-line day and date with its broadcast on TV? Won’t this substantially help grow the very business on-line they fear now? Yes, I bet it would.

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And in the long run, not too much of what they can do will prevent us all from getting it on-line. Once the majority of us have fat pipes able to deliver a TV show and watch a show seamlessly (think FIOS) as if it WAS TV, then instead of their being 95 million cable homes and 200 million homes with TV’s, there will be hundreds of millions of homes with TV’s – they’ll just be connected to a fat, dumb pipe. This changing of the guard won’t take that long – figure in the 5 years or so, things will REALLY shift.

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