Media Bites-November 23 2009

New TV business model causing conflict between broadcast and online platforms

Broadcast television continues to spend analyzing their current business model instead of determining ways to truly partner with online sites. One network exec has stated, " the spending on Hulu versus the network is still small. But the undercutting of broadcast CPM's is something we're all concerned about. It's been more pronounced during the past few months and it's something that Hulu has not addressed." A media buying source confirms their concerns, but goes on to say that, " Hulu doesn't really represent a threat to network TV, today. However, advertisers are considering online video as an alternative to broadcast.'

In my opinion, anything that allows me to consume media when, where and how I want it is a threat to the current broadcast model. Wouldn't it make much more sense to embrace change, develop technologies and produce programming that makes me want to spend time watching?

If Time Warner Cable can develop TV Everywhere beta that lets me watch premium pay per view content on my laptop and Comcast can launch a similar version, as well as a local sports VOD, why can't NBC, CBS, ABC, FOX and the CW do the same?

Media Bites-Nov 16 2009

Media Continues To Fragment But Innovators Find A Niche.



Tired of cable or satellite? If you live in the City of the Angels, starting today you'll have a new option: Sezmi.(http://www.sezmi.com/) Here's the skinny-Sezmi transmits cable networks through digital TV frequencies that they have leased from local broadcasters. Users install two pieces of equipment that the company is calling a 'smart reception system' that brings in over the air programming and the Internet, as well as a set top 'digital media player' that sends the programming to a TV screen or records it for later consumption. Customers can opt to lease the equipment (cost unknown) or purchase for $299.00.

During the trial for a monthly fee of $5.00 you can see local broadcast, Internet channels and some pay-per-view services. For $20 more you'll have access to over 100 cable channels. As a consumer, I'm all over this concept. As a customer of an unnamed cable company, I'm paying $135 for bundled services ( cable, Internet and phone) and we rarely go that far up the digital tier. The Sezmi model would have my monthly costs at $25.00 for the service, $40 for Internet (cable carrier)and $30 for phone (Vonage or similar). In times like these every penny counts and I'd take the $40 savings. Now, in fairness, what you'd be giving up are: 24/7 customer service.

Not only is Sezmi competitively priced for users, it has a distinct advantage over other TV-over-the-internet companies: it can offer networks a percentage of subscription fees , in addition to a revenue share from advertising. At this point in time, that's something a platform like Hulu can't offer yet; but that could all change with the proposed Comcast/NBCU merger.

(source: LA Times, Jon Healy. Images from Sezmi)

Media Bites-November 6 2009

Activity in the media business affecting change in the TV landscape


(1) During the last week of October, several TV station group owners reported third quarter revenue declines: Meredith (-13%), LIN TV (-18%), and McGraw Hill (-24). (Claire Atkinson-Nov 1 Broadcasting & Cable)

(2) Comcast is oppressively pursuing the purchase of NBC Universal and many executives expect the deal to close within the next 12-18 months, even with the sticky issue of Vivendi not yet relinquishing its 20% stake in NBC Universal. The Wall Street rumor on this deal is that Comcast may sell off the NBC Network and station groups to a third party.

(3) News Corp is also on the M&A hunt, bidding on Cox Communications 65% stake in Travel Channel, renaming it to National Geo Traveler. Fuel TV, the youth oriented net may also be sold off in the process.

Mergers, acquisitions and sell offs should all be viewed in a positive light for both consumers and advertisers. Networks and TV groups that are struggling could be revived and reinvented as part of a larger media organization, offering more selection, better programming and greater promotional opportunities. Additionally, alternative viewing platforms such as Hulu, Fancast, ZillionTV, TV Everwhere and now even ITunes, will have a more expansive market as viewers may elect to watch their favorite shows on their desktop, as well as on the set-top.Its hoped, and the preliminary research is proving it true, that if viewers tune in via an alternate platform, they will also sample the show during its time slot or via DVR or other device.

And according to a recent AP interview, Comcast CEO noted, ' I've been saying for a long time that I think video over the internet is more friend than foe.'

How great that would be if all of the parties could work together to deliver quality programming to viewers when they wanted and how they wanted it, subscription models that benefit consumers and programmers and advertiser friendly opportunities that make money for all.

Media Bites-October 27 2009

There is another player in the TV universe that hasn't even launched yet that may be worth checking out: Zillion TV. According to their website (zilliontv.tv) you choose the programs, how to watch even what addressable ads you'll accept. Right now they have agreements in place with Disney, NBC Universal, SONY and Warner Brothers.

Content streamed to my TV via the internet connection, I choose how I want it, when I want it and what ads I see. What a concept-media delivered to me when I want to get and programming I choose to receive. I may have to drop the cable provider when this launches.

Media Bites-October 16 2009

Comcast-NBC Universal-Vivendi deal will change the entertainment landscape.
The deal for Comcast to buy 51% of NBC Universal is just about wrapped up and the word is stil out on whether Vivendi will divest its 20% stake in NBC Universal.

Comcast subscribers total over 24 million and contribute to more than half of the company's 2009 revenue. The reasoning behind this deal all points back to viewing of content or as Brian Roberts, Comcast CEO calls 'cable bypass'-canceling their subscriptions and gravitating towards on line viewing platforms. The way around that is to prevent posting content on the internet, fee for content or accessing the content by proving users already subscribe to a pay TV service (TV Everywhere) Once this deal is complete, Comcast would hold the most TV assets worldwide including a percentage of the NBC broadcast network, Telemundo, USA, Bravo, MSNBC and CNBC.

To complete the deal that Comcast wants, Vivendi,(http://www.vivendi.com/vivendi/-accueil-en-) the French media and telecommunication company must shed 20% of its ownership in NBC Universal. Vivendi has until Nov 15 to notify one of its media partners GE, on whether they will sell any interest in NBC Universal.

It would be great if this entertainment merger and acquisition resulted in better quality programming, reduced subscription rates and innovative viewing technologies. It should since Comcast (http://www.cmcsk.com/)would control most of the content and production currently airing. Stay tuned as this will not be the end of TV consolidation, there will be much more to come that will hopefully make a positive impact on they way TV is delivered and consumed.

Media Bites-October 8 2009

Content is king-but will you pay for it?
After meeting with a local print publication recently who informed me that they would now be charging a penny to access online stories- and after News Corp chair Rupert Murdoch stated most of the FOX properties will move to paid content, I wanted to keep beating this drum and ask will consumers be willing to pay for content?

I keep coming back to the same answer: only if there is real value in it at that moment for you.

All media properties are on a quest to develop additional revenue streams without diluting their core products or worse, having consumers cancel subscriptions and suffer further losses. A recent LA Times article noted that Soleil Securities calculated that every viewer that alters their viewing habits, choosing web over TV is forfeiting $920 in annual ad revenue and that Disney, Fox and NBC subsidize $33 million in losses at Hulu which is offset by only $123 million in ad dollars. The skyrocketing cost of producing all forms of TV advertising is underwritten by the $22 billion in cable and satellite subscription fees but it is not enough revenue to generate a profit. The answer seems to be a slow migration to pay for online content access.

Which brings it back to the -only if there is real value at that moment for you. In my opinion, if its a news story then the answer is no. Why? Because if I'm really that interested, I'll surf around until I find it at no charge elsewhere. If its an episode of 'Its Always Sunny in Philadelphia' or 'Glee' that I want to see, or have the ability to download a full length movie to my Iphone-you bet I'll pay for that because its entertainment and I'm programmed to pay for entertainment. I'm not going to pay for the news when it's available 24/7 everywhere you turn.

If sites like Hulu.com and Fancast.com position and price themselves correctly, I believe you'll see not only increased usage and revenue, but more sampling of on air product as well. Print pubs are betting that if they price it more aggressively for subscribers, they will increase circulation. Only time will tell if that though process will work.

Media Bites-October 2 2009

The Jon and Kate + 8 saga takes an odd turn
As a parent of 3 kids under the age of 14, I've always enjoyed watching the daily struggles they all faced running a household with 8 kids. Each parent had their own style and personality and it seemed to work.

Then we hear things are not all wine and roses. Alleged affairs and struggles within the Gosselin marriage. Not unique to many families in America, but now wide open for everyone to see thanks to the beauty of reality TV (assisted of course by the media hoopla that surrounds them everywhere they went). So in an emotional and heartfelt response, Jon and Kate announced a formal separation and agreed to continue to do the show 'for the kids'. The show goes on hiatus and relaunches in August delivering over 9 million viewers.

Now all we saw and heard at the end of the summer was about Jon's partying, meeting with Lindsey Lohan's father to pitch a show and his dates with young adult women. All this from a man who has said one of the reasons for the separation was that he was uncomfortable with all of the media exposure.

The latest in what is really turning into a reality TV train wreck is a cease and desist order restraining TLC from any further filming with the kids delivered to the network by Jon Gosselin. Interesting, since according to TLC, he was directly involved in shooting only a few days prior to the legal document being filed. Why the change of heart? Could it be that the show name is being changed to 'Kate + 8'?? Will he loose out on some of the income that is being generated from the show?

Right now the focus should be on those kids that are seeing their parents relationship fall apart, in public. In my opinion, viewers will begin to retreat from the show, ratings will slip (they already are showing serious erosion) and the show will be either retooled or cancelled. Only time will tell-but lets hope TLC and the Gosselins do the right thing.