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    With New Features For Chromecast, Google Ups The Ante In The Living Room

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    While traditional TV content increasingly migrates away from the TV itself, onto mobile devices and screens, the TV screen is increasingly being commandeered by those same mobile devices for the display of content that originates elsewhere.

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    NAB 2015 Recap: Top Live, Linear & OTT Trends

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    LAS VEGAS–Last week’s National Association of Broadcasters convention here saw multiscreen, over-the-top broadcasting move, physically and figuratively, from a back corner of the Las Vegas Convention Center to front-and-center of the discussion. “Broadcasting obviously does not exist in isolation, but as a vital piece of the dynamic and ever-changing media and entertainment landscape,” NAB president Gordon Smith said in his keynote address. “As we get closer to realization of the next generation of television broadcasting, we are beginning to envision the new business opportunities it could enable. I believe next gen may be the key to building TV’s […]

FCC Engineers Some Cable Consolidation

Earlier this month, just after Comcast dropped its bid for Time Warner Cable in the face of opposition from the FCC and Justice Department, FCC chairman Tom Wheeler separately called TWC CEO Rob Marcus and Charter Communications CEO Tom Rutledge, along with several other senior cable industry executives, to let them know they shouldn’t consider all M&A deals to be off the table just because the agency put the kibosh on Comcast, according to a report in the Wall Street Journal.

Federal Communications Commission (FCC) Chairman Tom Wheeler gestures at the FCC Net Neutrality hearingOn Tuesday, Charter took Wheeler up on that seeming invitation and announced a plan to acquire TWC for $56 billion. Charter also reaffirmed its plan to acquire it smaller rival Bright House Networks for $10.4 billion. Read More »

Music Streaming’s Hidden Fees

Apart from precise dollar figures, there’s little in Sony Music’s original licensing contract with Spotify, uncovered by The Verge, that would surprise anyone familiar with how the major media companies do business with service providers (the full contract, which ran from 2011 to 2013, is here). Most of the money due to the label is payable upfront, in the form of a recoupable advances ($42.5 million over the three year term of the deal in this case), it includes a per-play minimum fee irrespective of Spotify’s own income, and it contains most-favored-nation (MFN) language assuring Sony that none of its competitors gets a better deal — all standard stuff.

Nonetheless, the contract provides a pretty good roadmap to where the money from streaming actually goes (hint: it’s not to artists).

spotify_1200x630_bThe advances payable by Spotify to Sony under the contract were recoupable (using a complex formula based on a fixed percentage of Spotify’s gross revenue, Sony artists’ aggreate share of total streams during the payment period and the minimum per-stream royalty) but non-refundable. If the actual payments due to Sony, as calculated under the formula, were less than the advance Sony kept 100 percent of the advance anyway. Read More »

A Fighting Chance for Live and Over-the-Top

The Mayweather-Pacquiao fight shattered all previous records for a pay-per-view event, according to the official tally from HBO and Showtime, racking up 4.4 million buys in the U.S. worth more than $400 million.

As we now know, it was too much of a good thing.

A last-minute crush of orders KO’d many pay-TV operators’ ability to process them, forcing promoters to delay the start of the fight to give operators time to catch up, but even with that several operators were forced to offer refunds to thousands of subscribers who were never able to access the PPV stream.

MayPac fightHBO and Showtime, which jointly produced the broadcast, actually saw the problem coming in the days leading up to the fight and tried to warn operators. Advanced orders were running well ahead of any previous event, but if MayPac held true to form, the vast majority of orders — as much as 90 percent of the total — would still come in the final hours. Given the baseline, the networks feared — correctly as it turned out — that a huge wave was building. Read More »

Verizon Opts Into AOL

Verizon is the largest wireless service provider in the U.S. with over 108 million retail connections as of the first quarter of 2015. But as the wireless business matures, providing connectivity is increasingly a zero-sum game among the four national carriers — Verizon, AT&T, T-Mobile and Sprint — leading to price wars in pursuit of marketshare and threatening margins.

Verizon_HQVerizon’s efforts to find new ways to monetize its user base, such as through advertising, however, have met with mixed results at best. It’s use of undeletable “super cookies” to track its subscribers’ web surfing, and the sale of those data to third-party marketers, led to an outcry among consumers and privacy advocates (and scrutiny from the Federal Communications Commission), which forced Verizon to allow users to opt-out of the program.

Now though, with its $4.4 billion acquisition of AOL, announced Tuesday, Verizon is gaining a portfolio of over 100 million device IDs from consumers who have opted-into direct, content-based subscription relationships with AOL’s media properties. From a data-collecting perspective (to say nothing of the legal and regulatory implications) that’s a much safer starting point than anonymous, surreptitious tracking. But those opt-in content relationships will also provide a foundation for the launch later this year of Verizon’s own opt-in over-the-top video service. Read More »

#MayPac: When Piracy Goes Mobile

Pay-per-view operators in the U.S. had trouble handling the last minute rush of signups for the “Fight of the Century” on Saturday, forcing promoters to delay the start of the welterweight championship bout between Floyd Mayweather and Manny Pacquaio by 45 minutes as operators scrambled to process the late orders and maximize the take.

MayPac_PPVIn contrast, the live-streaming apps Periscope and Meerkat worked flawlessly — so much so that it was possible to watch the entire fight for free as thousands of “Meerkasters” and “Periscopers” turned their phone cameras to their TV sets and rebroadcast the official HBO and Showtime broadcasts. There were so many streams available that Twitter users were able to catch every round, even as Periscope and Meerkat scrambled to respond to DMCA takedown requests, simply by jumping from one stream to the next.

There were also, of course, any number of free live streams of the fight available online for those who wanted to search for them, just as there are for any such big-ticket event, many of higher quality than anything you could see on Periscope or Meerkat. Boxing promoters in particular, in fact, have been battling pay-per-view piracy since the days of illegal, “black box” decoders in the 1980s and 90s. Read More »

Bad Sports: ESPN Sues Verizon

No U.S. television network is more invested in, or has benefited more from the dynamics of the bundle than ESPN. The combination of must-have programming for a key segment of the pay-TV audience, and the must-carry leverage of its sister-broadcast network ABC, has given the Disney-owned sports network the power to command the highest per-subscriber carriage fees in the industry, ensure placement on basic tiers, and compel carriage of ancillary networks like ESPN Classics and ESPN Deportes.

espn_sportscenter_logoFor those pay-TV subscribers not in the ESPN demographic, however, that leverage has acted like a tax, imposing higher costs for networks and programming they don’t watch, yielding what amount to windfall rents for ESPN. Those windfall rents, in turn, have given ESPN the wherewithal to pay the skyrocketing rights fees for live sports. Thoseinflated rights fees, in turn, have become the primary economic engine of most professional and big-time amateur sports while acting as a formidable barrier to entry for would-be competitors to ESPN, yielding a virtuous cycle that reinforces ESPN’s dominant position within the pay-TV ecosystem. Read More »

Comcast’s Bid for Time Warner Cable Gets Bundled Away

In his statement on Comcast’s decision to drop its $45 billion bid for Time Warner Cable, Federal Communications Commission chairman Tom Wheeler made it clear his agency was concerned about the merger’s potential impact on the development of the over-the-top video market:

Today, an online video market is emerging that offers new business models and greater consumer choice. The proposed merger would have posed an unacceptable risk to competition and innovation especially given the growing importance of high-speed broadband to online video and innovative new services.

nbc-comcastSo, too, was the U.S. Justice Department, according to a separate statement by Attorney General Eric Holder:

 This is a victory not only for the Department of Justice, but also for providers of content and streaming services who work to bring innovative products to consumers across America and around the world.

It was certainly a victory for content owners and providers, many of whom, such as Discovery and Netflix, had lobbied aggressively against the merger and cheered the deal’s collapse. But “content owners and providers” is a group that very much includes Comcast, by virtue of its owning NBC Universal, lending an unavoidable measure of irony to the outcome here. Read More »

Apple’s Non-Disruptive 4K Strategy

For all the disruptive innovation Apple has unleashed on the markets for devices and software it has not been particularly disruptive to the content markets it has entered. Often just the opposite.

By the time Apple introduced the iTunes Music Store the record business was already reeling from the impact of Napster and its progeny. Rather than disrupt the business, Apple’s entry created a new market for paid downloads. The record companies later came to rue the terms of Apple_TV_portsthe deals they made initially with Apple, the iTunes store helped restore legitimate commerce to digital music platforms and on balance has been a net positive for the incumbent rights owners.

Apple is now trying to do the same thing in music streaming, relaunching a paid-only Beats Music service as the record companies try to marginalize free streaming platforms. Read More »

Apple’s Bring-Your-Own-Streams OTT Hedge

ipad_remote_appAccording to a report by Recode’s Peter Kafka, which apparently is not a joke despite its April 1 dateline, Apple is asking the TV networks to provide their own streaming infrastructure and handle their own video delivery as part of Apple’s planned subscription OTT service.

The two leading theories for why Apple is looking to take such a hands-off approach are a) to avoid the costs involved in building out its own streaming infrastructure, and/or b) Apple thinks cable-based ISPs would be less likely to engage in f@ckery against the service if the networks are delivering the streams.

Neither theory is entirely persuasive.

The costs associated with streaming video are not prohibitive. The markets for transit and CDN services are very competitive and Apple would have not trouble attracting very aggressive bids for its business.

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YouTube Needs To Get Its Live Act Together

YouTube is not confirming but not exactly denying a report by the Daily Dot on Wednesday claiming the video site is getting ready to relaunch its live-streaming platform in with a new emphasis on games and e-sports. An announcement could come as soon as June, during the E3 game expo in Los Angeles, the report said.

Asked for comment, YouTube provided the website with a link to a GIF with no further explanation.  Asked in a follow-up inquiry whether the GIF was meant as a joke, YouTube replied that no, “the GIF really was [its] official response.”

Make of it what you will. But for YouTube’s sake I hope the original report is correct, because Google really needs to do something big in live streaming, and soon. Read More »

Apple’s Least-Favored Network: NBC

Ever since the Wall Street Journal reported earlier this month on Apple’s evolving plans to launch a multichannel subscription streaming video service, much has been made, largely by those already inclined to be suspicious of Comcast’s motives, of the reported absence of Comcast-owned NBC from the talks Apple is said to be holding with the other broadcast networks.

apple_tv“It appears from press reports that Comcast may be withholding its affiliated NBC Universal (“NBCU”) content in an effort to thwart the entry of potential new video competitors. Apple reportedly is planning a Fall 2015 launch for an over-the-top (“OTT”) bundle of TV channels,” the consortium Stop Mega Comcast wrote to the FCC last week. “If the reports are accurate about Apple, it would be consistent with Comcast’s prior conduct in attempting to leverage affiliated content to thwart rival services, even when faced with merger conditions.” Read More »

NFL Testing New Formations

The NFL seems to be in a test pattern. On Monday, the league announced that it will make next season’s match-up between the Buffalo Bills and the Jacksonville Jaguars available exclusively via the internet outside of the NFL_Networkteams’ home markets, rather than on national television. That was followed by an announcement that the league will suspend its local TV blackout rule for the entire 2015 season allowing games to be shown in their local markets even if the game is not a sell-out.

The league described both moves as tests, although what exactly is being tested in each case was left a bit vague. Read More »

From Apple Pay to Apple TV, Leveraging a Lack of Knowledge

We are not in the business of collecting your data,” Apple senior VP Eddie Cue declared in announcing the Apple Pay mobile payment system. “When you go to a physical location and use Apple Pay, Apple doesn’t know what you bought, where you bought it, or how much you paid for it.”

apple_pay_ogThe line was clearly meant as a swipe at Google and other competitors in the mobile payments space, who do collect purchase data and use it in ways that can implicate users’ privacy. But Apple’s studied indifference to the details of purchase transactions is also central to Apple strategy in launching Apple Pay. Read More »

Meerkat and The Dawn of Sender-Side VOD

There are plenty of live-streaming platforms out there for anyone who wants to set up their own broadcast on the cheap. But few have caught on as quickly or generated as much buzz as Meerket, the barely month-old streaming app that rides atop Twitter.

meerkat_logoOr at least it did until Friday, when Twitter abruptly cut off Meerkat’s ability to easily access users’ list of followers to automatically alert them to when a new “Meerkast” is in progress.

The move was neither unprecedented for Twitter, which has never been overly developer-friendly, nor particularly surprising insofar as Twitter announced its acquisition of Periscope, a competing live-streaming app, reportedly for $100 million, on the very day it shut the door on Meerkat.

So much for platform neutrality.

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