T-Mobile is calling on the Federal Communications Commission (FCC) to “tread lightly” as the agency looks into a series of video offerings that have raised net neutrality concerns among advocates. The mobile carrier has been at the center of the debate recently with its new Binge On video program, which exempts certain video from customers’ monthly data caps but also reduces the download speeds of all video.
These financial giveaways, say both companies, will be distributed completely in accordance with how artists are usually recompensed on usage, via their regular streaming royalty rates. As one MBW reader smartly pointed out on Twitter minutes after Warner’s announcement… This all sounds suspiciously fair, doesn’t it?
Many musicians feel like they’re getting screwed in the age of streaming music so Warner Music Group wants to spread a little love. The company said Thursday it would include artists in any cash windfall Warner might get from the ownership stakes it holds in streaming services like Spotify in the event those businesses go public or are sold. Within hours of Warner’s announcement, Sony Music said that it’s doing the same.
Twitter is designed to thrive during events like the Super Bowl, the National Football League’s championship on Feb. 7 that will draw people to their televisions with an eye on their smartphones. But the company is struggling to find its footing at a time when bigger rivals like Facebook and Google are pushing into its territory. Wix.com’s view of Twitter as insignificant reflects a wider question about its role in the digital media landscape, with some marketers expressing increasing impatience about the company’s direction.
The National Football League is shopping digital rights for “Thursday Night Football” games — and tech giants Apple, Amazon.com, Google and Verizon’s Go90 are each expected to try to get in on the action, according to industry sources.
As of today, searching for content on the Apple TV will encompass the aforementioned apps along with FOX NOW, FXNOW, and National Geographic. Apple also expanded universal search to include PBS and PBS Kids in January.
The company’s cloud segment has done business with an alphabet soup of agencies including, NASA, HHS, and DOJ. Even then, the full scope of Amazon’s business relationship with the government is hard to track because there are more than a dozen resellers that agencies can also use to purchase its services. But one government agreement stands out: In 2013, Amazon was awarded a contract worth up to $600 million by the CIA to build and maintain a cloud system for America’s intelligence agencies — over the obje
Comcast, Time Warner Cable and Charter all reported strong video subscriber growth in the fourth quarter of 2015, adding 172,000 between them. That was a far cry from a year earlier, when they collectively lost 35,000 video subs.
The results led some to speculate that the worst days of cord-cutting are now behind the industry and that cord-nevers may be starting to change their minds about paying for TV.
Maybe, although the pay-TV industry as a whole continues to lose subscribers, at a rate of about 1 percent a year, according to an estimate by MoffettNathanson analyst Craig Moffett. Most of that shrinkage in the fourth quarter came from telco and satellite providers, as those two businesses undergo restructurings.
Between them, Verizon’s FiOS TV service and the combined AT&T/DirecTV lost 6,000 video subscribers in the quarter, as Verizon shifted its video focus to its new mobile streaming service Go90 while AT&T shed U-Verse subscribers as it prepared to swallow DirecTV.
In Comcast’s Q4 earnings call, CEO Brian Roberts acknowledged that some of cable’s gain last year probably reflected a market share shift, reversing several years in which cable was losing share to satellite and telco.
“I think the pendulum does tend to swing,” Roberts said. “There was a time others had high-definition TV and we didn’t, and there was no interactivity and no video-on-demand. Fortunately, we made investments and we bet right.”
Another striking pattern in the numbers, though, was a dramatic shift in the ratio of new video to broadband subscribers. Comcast, Charter and TWC collectively added 856,000 broadband subscribers in the fourth quarter. That put the ratio of video additions to broadband additions at 20.1 percent. In the same quarter last year, that ratio was a negative 15.2 percent (combined video losses of 35,000 to broadband additions of 647,000).
The 32.3 percent year-over-year growth in broadband subscribers among the three cable providers reflects continued strong demand for high-speed internet connections. The big swing in the video numbers, however, suggests that cable operators are also getting much better at selling video along with broadband.
Broadband, in other words, may be the main selling point for consumers, but growth in broadband is now pulling video along with it in a way it hasn’t before.
One explanation could be skinnier video bundles lowering the total cost of broadband and video for new customers. According to Comcast’s cable president Neil Smit, however, 75 percent of video additions in the quarter came from people buying high-end packages.
That might imply that 25 percent came from skinny packages, but a Comcast spokesperson told Re/Code that the other 25 percent came from a variety of packages, not just skinny bundles.
Another, potentially more troubling possibility is that cable operators are getting better at leveraging their dominant market position in broadband to crowd out potential video competitors. If you price standalone broadband access high enough, someone thinking of relying on Netflix and Sling TV for their video might think twice if the broadband provider bundles in a video package at a modest incremental cost over broadband alone (cord-stuffing?).
Cable operators would no doubt argue that affordable bundles are pro-consumers. But as BTIG Research analyst Rich Greenfield has pointed out, federal regulators have a pretty well-developed theory at this point about cable’s market power in the broadband business, which led the FCC and the Justice Department to block Comcast’s attempted merger with Time Warner Cable even as they allowed AT&T to acquire DirecTV. DirecTV was not a major broadband provider.
The feds are also clearly concerned about cable’s market position in video delivery, as reflected in the FCC’s recent move to consider forcing pay-TV providers to open their set-top boxes to competing device makers — a move not so incidentally endorsed this week by the head of the Justice Department’s antitrust division.
Cable operators could invite even more unwanted scrutiny if they appear to be using their market power in one business to protect their interests in another.
The head of the Department of Justice’s Antitrust Division said he was all for FCC chairman Tom Wheeler’s “inquiry” into new set-top rules. “The set-top box rules that are currently in place were designed for a marketplace of old technologies and traditional business models,” Assistant Attorney General Bill Baer said. “The FCC is right to examine the issue and we look forward to participating in the effort to ensure that the benefits of competition and innovation reach American consumers.”
From an addressable advertising standpoint, Comcast sees growth opportunity in linear television. The company’s investments in video ad server FreeWheel and addressable ad platform Visible World were spurred by exploration of advanced ads both on the buy and sell side. “We believe the real opportunity in the linear space is to do the things that digital does so well – measurement and targeting,” added Mike Cavanagh, CFO of Comcast.
Six Democratic US senators today criticized Comcast and other TV and broadband providers for charging erroneous fees, such as cable modem rental fees billed to customers who bought their own modems. The senators have written a letter to Federal Communications Commission Chairman Tom Wheeler asking the commission to “stop unfair billing practices.”
During Comcast’s* earnings call, cable boss Neil Smit told analysts that skinny bundles “are actually a very small percentage of our overall video customer base,” and that 75 percent of the company’s growth in video subscribers last quarter had come from people paying for “higher-end packages.”
The nation’s largest cable company added video customers in the fourth quarter, capping off its best year in almost a decade as cable providers gain market share in a contracting pay-TV market. Comcast was able to, at least for now, defy the industry logic that cord-cutters are increasingly abandoning pay TV. It has been investing in customer service and in its set-top box and guide, which it says encourages customers to watch more TV and makes them less likely to cancel service.
The growing playlist scene on streaming services is becoming a “closed shop” to independent labels, that are finding it increasingly difficult to infiltrate the major label-dominated playlists on Spotify, Apple Music et al. That was a key message from AIM’s annual Indie-Con in London on Friday (Jan 29), which hosted a day of panels debating the health of the independent sector worldwide, featuring execs from labels including BMG, Play It Again Sam, !K7, Secretly Group and Inertia.