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Is Apple Planning to Pair 99-Cent TV Show Rentals With Its $99 iTV?

Internet Success Hub — Thu, 26 Aug 2010 14:09:45 +0000

Bloomberg is reporting that Apple is in “advanced talks” with CBS, Disney and Fox about making available TV programs for 99-cent rental. The programs would be offered within 24 hours of when they aired and once rented, the viewing window would be just 48 hours. It’s not clear whether the iTunes rental model would be targeted only to Apple’s “i” devices, or if it would be more widely available. If the program deals happen, could it be that Apple is planning to pair availability of 99-cent rentals with the unveiling of its $99 iTV device at its rumored Sept. 7th keynote event?

In my earlier post, “Pondering the (Potential) Impact of Apple’s New iTV Device,” I speculated that the iTV device would have little impact on the pay-TV ecosystem, since major cable TV networks and pay-TV providers will resist Apple’s attempts to reinvent their business models. However, I suggested that Steve Jobs could have a trick or two up his sleeve for the iTV’s launch. Sure enough, 99-cent broadcast TV rentals, announced just weeks prior to the Fall TV season kickoff, would be a very good trick indeed.
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By pairing 99-cent rentals with the $99 iTV device, Jobs would not only be giving the iTV compelling content access right away in addition to existing apps, he would be helping shine a bright light on the high perceived cost of today’s pay-TV services (a nice follow-on to yesterday’s Kagan research showing Q2 as the first-ever down quarter for pay-TV providers, due to the recession’s impact).

While next-day, 99-cent broadcast rentals aren’t close to being an equivalent service to more expensive first-run, pay-TV subscription services, can’t you easily imagine Jobs articulating the benefits of a low-cost, a-la-carte model and suggesting that this is what consumers truly want, not bloated, overpriced multichannel subscriptions? He would use the success of 99-cent iTunes music downloads to draw a parallel: what Apple did in music, it’s now going to try doing in TV (though to be accurate, in music those 99-cent transactions are for purchases, not 48-hour rentals).

Aside from whatever spin Jobs uses, the question is, will consumers bite on the 99-cent offer? I think they may very well. Here’s why: network sites and Hulu have long been about catch-up viewing of missed episodes. Part of these sites’ appeal has been easy, convenient and free access. The downsides have been limited ability to watch on TV, inability to skip ads and inconsistent availability of recent episodes, due to windowing policies. If Apple could get these programs for 99-cent rentals – still a huge if – it would neatly address all these shortcomings. Via iTV, programs would be easily viewable on TV, commercial-free and possibly with all the current season’s episodes. It would be like a nominally-priced, attractive VOD service. It wouldn’t be a cable-killer or cord-cutting stimulant. But it would help Apple gets its nose further into Hollywood’s tent.

For the networks, they would open yet another window, albeit a narrow one, to further monetize their programs. With a massive potential user base (remember all the millions of existing “i” devices in addition to the new iTV), the revenue potential could be huge. The flipside is what the 99-cent rental plan would mean to the new Hulu Plus subscription service, which offers both current and past season for $10/mo? It seems like lighter Hulu Plus users would almost certainly be cannibalized by Apple’s 99-cent rentals. And commercial-free 99-cent rentals would undermine the ads currently included in Hulu Plus programs, which I’ve argued is a foolish tactic anyway.

Of course all of this is pure speculation upon speculation. But it’s all plausible. And with Steve Jobs in the middle of the action, it’s all the more possible. Let’s see what happens.

What do you think? Post a comment now (no sign-in required).

Clicker’s iPhone App Goes Live

Internet Success Hub — Thu, 26 Aug 2010 14:09:41 +0000

Clicker, the online video guide and social check-in service, had its free iPhone app go live today, which it had previously announced last month as part of its Clicker Social launch. The app allows iPhone users to search iPhone-compatible videos, take advantage of the Clicker Social features (comment, rate, share, check-in, follow friends, etc.), create and manage playlists for later viewing and check their account.

By way of comparison, I’ve played around some with the Clicker Android app on my Droid X. I’ve mainly focused on the search/discovery features, which are Clicker’s key differentiator vs. other services that offer check-in for TV shows. It’s incredibly handy, though the big issue for now is the limited assortment of videos actually available for viewing on the Droid X, which does not yet support Flash.

Still, as more videos become available (particularly the Netflix and Hulu Plus Android, sooner rather than later hopefully), a unified mobile search experience like Clicker offers is going to be even more valuable. The DVR/playlist function also offers another tantalizing glimpse into how multi-platform interactivity will work (set here, record there, watch somewhere else). Clicker also says an iPad app is in the works for early October. Lots of good stuff ahead.

Webinar Today: Independent Online Video and Syndication

Internet Success Hub — Thu, 26 Aug 2010 14:09:40 +0000

Please join The Diffusion Group and VideoNuze today at 11am PT/2pm ET when we will present the fourth complimentary webinar in our 2010 “Demystifying” series, with this session’s focus on demystifying independent online video and syndication models. The series is exclusively sponsored by ActiveVideo Networks.

TDG’s Colin Dixon and I will be hosting and moderating the webinar, which will include guests Jim Louderback, CEO of Revision3, and Rich Bloom, SVP of Business Development for 5Min. Jim and Rich will each do short presentations and then we’ll have moderated Q&A followed by plenty of time for audience Q&A.

Jim and Rich will cover what’s working for their companies and what’s in store for the broader online video industry going forward. If you’re an independent video producer, or part of an established media company looking to succeed in the online medium, this webinar is for you!

Click here to learn more and register about this complimentary webinar

Pondering the (Potential) Impact of Apple’s New iTV Device

Internet Success Hub — Thu, 26 Aug 2010 14:09:32 +0000

Once again it’s the silly season, when rumors and pronouncements about still-shrouded-in-secrecy Apple products start flying around the Internet, often forecasting a future radically changed by another wave of Steve Jobs’ magic wand. The latest Apple product in the speculative crosshairs has been dubbed “iTV,” and was originally described back in May by Engadget as an “iPhone without a screen” (and a phone for that matter), that would bring the world of Apple’s App Store to the big screen and would also be capable of playing some flavor of HD video. It would also carry a surprisingly low (for Apple products anyway) $99 price tag.

It’s easy to see an iTV device being a volume success for Apple, though given its low price point, profit margins could be a different story. The groundwork for iTV’s success has been laid by the massive success of Apple’s App Store and iTunes, which would now would be inexpensively connected to the TV. The concept “apps on TV’ is getting a lot of attention lately, with Samsung making a big push, and of course Google TV being primed to deliver apps from the Android Market.
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To be sure, there are some apps which are video oriented, like Netflix’s and ABC.com’s, both of which are hugely popular on the iPad. However, the vast majority of today’s apps aren’t about video, they’re about location-based functionality, social interaction, gaming, etc. When accessed on the big screen, some existing apps will be enhanced, while for others TV access may feel neutral, awkward or irrelevant. In addition to current apps though, there are all the new apps that could be created for the TV (games come to mind immediately) that iTV would catalyze. In this light, the iTV, especially at its low $99 price, could be a very exciting product.

When it comes to video however, it’s important to keep expectations for the iTV in check. While Apple’s famed ease-of-use will likely set a new standard for the connected device experience, satisfactory solutions for bridging online video to the TV have been around for some time now (e.g. gaming consoles, Roku, TiVo, direct laptop connects, etc.). There’s no question having the bells and whistles of apps like Netflix’s and ABC.com’s enabled on the big screen through iTV – plus some potential interplay with the iPad – will be slick, but are they going to feel game-changing? I’m not so sure.

The bigger question for iTV is whether it’s going to have a substantial impact on today’s pay-TV ecosystem as a whole. Some are already buzzing that iTV will be an over-the-top video enabling cable-killer (Digg’s Kevin Rose was the latest to forecast this in a well-circulated post). Personally, I don’t see this happening. As I tried to explain recently in “Why Apple Doesn’t Have a TV Strategy,” Steve Jobs’ ultimate vision of Apple reinventing the pay-TV industry has hit a wall of objections from industry players who have no need or desire to see Apple enter their insulated, profitable corner of the world. With the exception of select cable content streamed to Netflix subscribers, once again it looks like Apple will be relying on its pay-per-use iTunes store to provide iTV users access to the latest cable programs. If that’s the case then iTV will have as much impact on the pay-TV industry as the ill-conceived Apple TV box before it had (which was approximately zero).

It’s always possible that Steve Jobs will have a trick or two up his sleeve when iTV is revealed, likely in September. Maybe Apple will finally pony up some of its cash horde to gain direct access to cable content for inexpensive viewing? Or maybe iTV will have broader functionality, like what Google TV will have, which could add new value to existing cable programs? Nobody knows. For now, we can only speculate, and add VideoNuze’s voice to the silly season’s chorus.

What do you think? Post a comment now (no sign-in required).

(Note: Adam Wright contributed to this post.)

Pay-TV Industry Loses Subscribers in Q2 ‘10 For First Time Ever; Cable Bears Brunt

Internet Success Hub — Thu, 26 Aug 2010 14:09:29 +0000

Research firm SNL Kagan is reporting today that the U.S. pay-TV industry (cable/satellite/telco) lost 216,000 multichannel TV subscribers in Q2 ‘10, the first time the industry as a whole has lost subscribers. Cable operators bore the brunt of the losses, dropping 711,000 subscribers, with Kagan saying 6 of the 8 operators reporting suffered record quarterly losses. By contrast, telcos added 414,000 subs in the quarter and satellite providers gained 81,000. The losses leave cable’s industry share at 61%, down from 63.6% a year ago.

Kagan analyst Mariam Rondeli ascribed the quarterly losses to low housing formation and high unemployment due to the ongoing recession, coupled with churn due to promotions from last year’s broadcast digital transitions expiring. Rondeli pointed out that over-the-top video alternatives were not the cause. By comparison, the pay-TV gained 378,000 subscribers in Q2 ‘09, meaning there was a swing of 594,000 subscribers year-over-year. U.S. Pay-TV providers as a whole ended Q2 ‘10 with 100.1 million subscribers.

Looking ahead, I’ve heard some murmurs that Q3 ‘10 could be softer than in prior years, again partially due to the recession, but also because seasonal college students’ subscriptions may be reduced due to over-the-top alternatives. While we’ve yet to see any tangible evidence of cord-cutting, the first impact may simply be slower multichannel sign-ups from younger users more accustomed to watching online. We’ll see.

What do you think? Post a comment now (no sign-in required).

TV Everywhere On Track for 30-50 Million Homes By End of 2010: Turner Exec

Internet Success Hub — Thu, 26 Aug 2010 14:09:17 +0000

TV Everywhere services will be available to 30-50 million U.S. homes by the end of this year, according to Jeremy Legg, SVP of Business Development and Multi-Platform Distribution at Turner Broadcasting whom I spoke to last week. Jeremy characterized the 30 million number as “realistic” and 50 million as “plausible.” Turner is part of Time Warner, which has been the most significant proponent among content providers of TV Everywhere services; Jeremy is the point person at Turner for its efforts.

I’ve thought TV Everywhere was a smart concept since it was unveiled last summer, in a high-profile news conference with Time Warner’s CEO Jeff Bewkes and Comcast’s CEO Brian Roberts. Since then though, pay-TV distributors in the U.S. have been relatively quiet about their TV Everywhere rollout milestones, leading me to grow skeptical about whether they’re putting enough muscle behind their efforts. As I argued recently, the stakes for TV Everywhere success have grown considerably as Netflix in particular has ramped up its online offerings, getting closer and closer to pay-TV players’ traditional turf.
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Jeremy contends however, that there is a lot more TV Everywhere activity happening behind the scenes than has been announced, both among distributors and content providers. On the distributor side, Jeremy says that trials are continuing and even though there are a lot of moving pieces, key technology solutions have matured, allowing more templatized rollouts. Jeremy wouldn’t provide detail on which distributors are in his count of 30-50 million homes. Time Warner has announced TV Everywhere deals with Comcast and Verizon. Comcast itself has been reticent to announce progress with its Fancast Xfinity TV service as it maintains its focus on completing its NBCU deal.

Obviously TV Everywhere services’ appeal is largely tied to what specific content is available, leading to the other sticky issue of content providers’ willingness to participate. Here Jeremy said that contributing concerns centered around determining ad loads, measurement, rights/windows, delivery logistics, security and economics. Jeremy said Turner got started addressing these items earlier than most others, positioning them to be an early proponent.

Though it’s a long list of considerations, Jeremy sees progress such as Nielsen soon extending its C3 measurement to online viewing. As well, some networks have been finishing up negotiations for linear channel carriage, which impacts their TV Everywhere participation (one recent example is CBS-Comcast). And strategies around windowing are starting to coalesce. Still, given the multiple approaches to rolling out TV Everywhere, there is no magical switch to be flipped, making all programs currently delivered to the living room accessible online at once.

Taken together, it seems like the pace has increased on multiple fronts which should lead to more public updates in the Fall plus real progress on the ground. While there is little current evidence that consumers are cutting the cord, the entire pay-TV industry is in a day-to-day PR battle with upstarts like Netflix, YouTube, Hulu and others, which are vying for consumer attention. And as the recent Netflix-Epix deal showed, very real options for getting similar programs for lower costs are cropping up. All of this means pay-TV providers must stay sharp and push hard on technology-focused solutions like TV Everywhere that enhance their services.

What do you think? Post a comment now (no sign-in required).

NY Times Gives Online Video High-Profile Coverage With Today’s "Sofa Wars" Series

Internet Success Hub — Thu, 26 Aug 2010 14:09:14 +0000

More evidence that online video has gone mainstream, as the NY Times is running a series today, dubbed “The Sofa Wars,” includes half a dozen articles looking at online video’s incursion into the living room. Included in the series are articles on cord-cutting (or the lack thereof), Sony’s bet on Crackle, the range of connected devices vying for market share, the role of 3D in selling TVs and Dish Network’s new online initiatives.

The Times’ coverage further underscores how online video has burst into the public consciousness in the past few years. In the pre-YouTube era (before 2005), online video was still a fringe activity for people willing to hunt around for valuable video and suffer through often sub-optimal delivery quality. Now, as comScore reports each month, online video is watched by the vast majority of Internet users. It’s becoming as common as sending an email. With connected devices proliferating to bring online video to TVs, what additional consumer behavior changes can we expect over the next 5 years?

What do you think? Post a comment now (no sign-in required).

Crowdsourced Fan Film, Star Wars Uncut, Is Finished… And It’s Awesome

Internet Success Hub — Thu, 26 Aug 2010 14:08:36 +0000

I’ve been interested in the Star Wars: Uncut project ever since I heard about it last October. The premise: let fans pick their favorite 15-second scenes from the original Star Wars: A New Hope movie and re-film it—fan film style—and then stitch together everyone’s scenes to recreate the movie. Sound ambitious? It was. Sound awesome? It is.And now it’s finished. Oh, and it just won an Interactive Fiction Emmy over the weekend.I’ve written a couple />Read more..

Online Video Advertising Turning Into A Feeding Frenzy?

Internet Success Hub — Thu, 26 Aug 2010 14:08:34 +0000

I hate the terminology we associate with things. Words like epic, frenzy, legen….dary (thanks Barney Stinson) and unbelievable, phrases like iPhone-killer, the best ever and simply perfect. They all make me groan in disgust and I blame the sensationalist media in America for it all. The latest overly hyped phrase was used in reference to online video advertising heading for a ‘feeding frenzy,’ can you hear me groaning? But wait, perhaps we really are heading for this proverbial feeding frenzy. We all know money has been pouring into the industry for the past couple years. Everyone’s bottom line seems to be picking up and with a rebounding economy those recently shrinking marketing budgets are going to start ballooning again. Where will that money go? Yeah, most… />Read more..

Tremor Media Announces HTML5 Support For Video Ads

Internet Success Hub — Thu, 26 Aug 2010 14:08:32 +0000

Tremor Media announced they’re going to begin offering HTML5 support for their video ads, mainly focusing on the iPad and then other mobile platforms. Considering that they reach about 19% of the US population and show around 450 Million ads a month, it’s a smart move.They are not the first video ad network to implement HTML5, nor will they be the last as many people begin to see some value in offering video ads to the iPs. That’s not to say that there aren’t ads available, Apple’s own ad solution is coming soon as well.Tremor’s iPad support will leave their HTML5 initiative and then they will focus on other platforms like the iPhone, Android, etc. The HTMl5 support will be offered via the Acudeo platform from Tremor… />Read more..