Business

What happens in Vegas

January 9, 2012
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Las Vegas – The first annual International CES opens here this week and is expected to attract somewhere north of 140,000 gadget makers, press, politicos, and buyers and sellers of stripes, to say nothing of your humble correspondent. Normally this time of year, those same folks would be attending the Consumer Electronics Show here. But the organization that puts on the show, the Consumer Electronics Association, has decided to drop the reference to “consumer electronics” in the name of its signature confab. From now on, the “CES” in International CES won’t actually stand for anything. It’s just the group of three letters people have been using as a handy abbreviation for the Consumer Electronics Show since it stopped being the Radio Manufacturers Show sometime in the 1960s.

The “rebranding,” as the marketing folks say, comes as the show is in fact experiencing something of an identity crisis, underscored last month by word that Microsoft would no longer send its CEO to keynote the confab after this year and would significantly scale back its participation in the show. To longtime show-goers, Microsoft’s decision to drop out is no great loss. Neither Steve Ballmer, nor Bill Gates before him, had said anything worth hearing at Microsoft’s traditional night-before keynote in years. And much of what they did talk about often turned out to be vaporware (Spot watch, anyone?). Read more »

Don’t bet on a Netflix sale

December 13, 2011
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Video Streaming Another Netflix bubble burst: On Monday, its shares soared more than 6 percent on reports that Verizon was in talks to acquire the video streaming and DVD-by-mail company. By the closing bell Tuesday, the shares had given back nearly all of those gains after several analysts shot down the initial reports.

Still, hope springs eternal, and the shares were up again in the after hours market, perhaps on speculation that even if Verizon isn’t a buyer for the currently beleaguered service, someone else might be.  Maybe, but I wouldn’t bet on it.

The Verizon rumors gained traction initially because Verizon CEO Lowell McAdam acknowledged publicly last week that the telco was interested in the online video streaming business, going so far as to admit to kicking the tires at Hulu when it was being shopped. But of all the potential suitors for Netflix, Verizon is among the least likely.

Most of Netflix’s growth over the next several years is likely to come from outside the U.S., which is not a good fit for Verizon strategically. It also certainly doesn’t want any part of Netflix’s DVD Read more »

Cable networks no longer thick as thieves

December 6, 2011
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Programming Lots of grumbling out of the UBS Media & Communications conference yesterday over the soaring costs of cable TV programming. As usual whenever the subject of programming costs comes up, much of the ire was directed at ESPN, which squeezes an estimated $4.69 per subscriber from cable and satellite operators — orders of magnitude higher than what any other pay-TV network commands.

What was not usual was the source of the grumbling. It came not from cable and satellite operators, who have long griped about the cost of ESPN, but from other cable network owners, who presumably would love to be in ESPN’s position. Under the growing strain of falling video subscriber numbers industrywide, other networks are growing concerned that ESPN’s position is coming at the expense of their own.

On Monday, Liberty Media CEO Greg Maffei called the rising cost of ESPN a “tax on every American household,” that threatened the long-term economics of the pay-TV business, to say nothing of the long-term comity of the pay-TV industry. “What happens to the bundle of cable if you keep pushing [the price] higher and higher?” he wondered, as reported by the Wall Street Journal.  Read more »

Microsoft’s non-disruptive disruption

December 5, 2011
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Digital Living Room Microsoft will roll out a major makeover of Xbox Live Tuesday, adding a raft of new OTT video and music services. The update will also deliver a new user interface and enhanced voice-recognition capability for the Xbox Kinect platform, enabling Kinect owners to control their Xbox Live experience through a combination of voice and gesture control.

While Microsoft is hardly the only technology giant looking to plant its flag in the living room its approach is notably different from that of Apple or Google, to name two of the other leading contenders.

The first iteration of Google TV represented a bald attempt to establish browser-based search as primary means of finding and accessing video content. The reason for the emphasis on search was obvious: Google dominates the search business and has a proven and highly efficient engine for monetizing search results through advertising. Read more »

Netflix and the cost of doing business

September 19, 2011
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Licensing Netflix really, really doesn’t want you using both its streaming service and it’s DVD-by-mail service. As of this month, it costs subscribers 60 percent more to use both services than it used to, thanks to the company’s recent price changes. As of today, it’s a bigger pain in the ass as well.

In a post on the company blog Sunday night, CEO Reed Hastings announced yet more changes that will force subscribers who want both streaming and DVDS not only to maintain two, separately billed accounts, but manage them on two entirely separate web sites, one of which is not even branded Netflix anymore. To order a DVD, users must now log on to the newly christened Qwikster web site, while their streaming business will be transacted through the Netflix site at a different URL.

There’s more: Read more »

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