Author: Todd

Two tales of sports domination

As television continues to splinter, with more entrants into the fray on a regular basis (see YouTube TV), what is becoming clear is the struggle of broadcast networks to maintain a hold on their traditional audiences. And the power of popular sports to attract viewers that will sit through advertising is almost unquestionable. There are two recent articles in Ad Age that echo this sentiment.

First, in this article about the IPO of Snapchat (aka, Snap) makes clear that their dependence on sports programming is a paramount concern. The revenue stream depends almost solely on advertisers, and Snapchat has devised a way to make it a preferred source for watching sports.

“In many ways, the NFL is the quintessential example of Snapchat’s dream of becoming the next TV — top media partners producing original content and selling that to advertisers in upfront multimillion-dollar deals.”

For broadcasters, the news just keeps getting worse. As this other article mentions, every traditional broadcast network has seen a decline in viewership, with the sole exception of Fox. And in their case, this is revealed:

“Pull sports out of the mix and Fox’s ratings struggles become even more self-evident.”

So, what does all this mean? It’s not entirely surprising, and with digital platforms like Twitter and Facebook, as well as mobile providers like Verizon, all trying to get a piece of the sports action, it is no wonder that Disney stock is suffering mainly due to ESPN, which must now face higher license fees for sports because of the competitive bidding.

The real winners continue to be the owners, and I expect the players will also get a taste. The question becomes, what sport will emerge as demand for programming grows? UFC? Drone racing? Spelling bees? One can only speculate…

Where is this all heading?

I’ve been watching with deep interest the progress of various video platforms as they emerge and develop, from YouTube and Netflix to Twitter and DirecTV Now. Here’s a brief rundown of a few of them from eMarketer that should give you an appreciation for the current state of flux, as well as the huge potential for coming disruption in the marketplace.

It seems that first we had simple websites that provided a platform, notably YouTube and Vimeo. Then we saw the TV Everywhere approach from HBO Now, as well as non-cable providers like Netflix, Hulu and Amazon. There’s a move to applications that can provide video content, from sports leagues to Twitter and Facebook. But it is such a tangled web that there is no clear indication as to where it will all shake out.

I suspect that a combination of advertising strength with high-demand content will drive this initially. Those platforms with which advertisers are comfortable (YouTube, Facebook, etc.), and content that is both timely and popular (primarily sports), will be the leaders in the transition that is currently underway. This is a chapter that is very much being written, and companies will rise and fall depending on their ability to forecast and anticipate the trends. But this much continues to be clear: Those who control the rights to this content (sports, awards) will control much of the destiny, and those who must pay for licensing  those rights will face increased price pressure in the coming days (witness ESPN’s effect on Disney stock).

Discuss…

That didn’t take long…

emerge JPEG logo - from Sulmonetti

As I mentioned in my most recent post, the merging of entertainment with devices really signaled the arrival of the digital era, epitomized by the iPod and iPhone. Now, this article just landed, detailing how Sony and the Playstation have been working on getting back into the streaming media mix.

As Variety reports, HBO Now will now be available on the Playstation. I’d be very interested to hear more about the financial arrangement behind this, but if you’re going to be in the console game, you’re going to need content.

This is what e-merge is all about!

When I first devised the concept of e-merge Media (back in 2003!), my thought was that the landscape of entertainment would be forever changed by the adoption of digital media. We see it on our mobile devices everyday, and now there is increasing convergence of media devices with entertainment. Apple was the first with its wildly popular merging of iTunes with the iPod and, eventually, iPhone.

Today, we are seeing Amazon, initially a online retailer, using music again to promote a tech device. In this case, its Echo. It already has experience with the Kindle and ebooks, but this now puts it squarely in competition with Apple, Spotify and Pandora. But this poses a larger question…

Will it become necessary for device makers to create (or own) the content it provides? Microsoft tried it with the Xbox, and Sony tried it with the Playstation, but each has had varying degrees of success, and the outlook is still hazy.

I will be watching very carefully to see what happens with Verizon and Yahoo! I will also see what develops with AT&T and DirecTV. Now that Netflix is enjoying success with its original programming, and previous suppliers becoming reluctant to sell to a direct competitor, will the it become a takeover target for a television manufacturer or wireless provider?

I am very excited about the prospects of this merging of entertainment with technology… and I humbly (or not) say that i saw it coming way back in 2003.

All hail e-merge Media!

An authentic tale of success in Hollywood

 

emerge JPEG logo - from Sulmonetti

“Don’t Breathe” from director Fede Alvarez scored big at the box office this past weekend, surpassing all others to debut at #1. And while I haven’t see the film (yet), I thought the trailer was pretty compelling, and its success came as no real surprise.

What I didn’t realize was the lineage of its director and co-writer, Fede Alvarez. I had actually seen his early work years before when this YouTube video was garnering a lot of buzz, for what amounted to five minutes of cool special effects and terrific directing. I’ve seen some promising artists create interesting work online before (most notably, “405 The Movie,”) but Fede actually had a lot of luck to match his talent, leading him to Sam Raimi and his first Hollywood film, the remake of “Evil Dead.”

The story is told best in this interview with John Horn from public radio’s KPCC, and it is fairly detailed in how it all happened. The reason why this stood out for me was it seems that, too often, we hear success stories that omit huge steps in how a project came to prominence. In particular, I reference this article from The Los Angeles Times a few years back about how “Grand Torino” got made. It was this passage that frustrated the hell out of me:

“Schenk managed to get the script to two younger producers, Jenette Kahn and Adam Richman, who optioned the story with their own money. Schenk says everyone they took the script to passed. They finally got the script to Gerber, a veteran producer and one-time Warner Bros. production chief who had worked on a number of Eastwood films. Gerber gave the script to Eastwood, who read it and simply said, “I’m doing it.”

Having been an agent for years, I know that this really gives short shrift to the process, and I felt that this particular series of events warranted much greater attention, for the sake of aspiring screenwriters everywhere, if nothing else.

Anyway, I had to write about Fede’s path to critical and financial success in Hollywood because I still harbor frustration over that LA Times article from 2008. I guess I’m still learning to just let things go. And in the end, as difficult as it is to make it in this business, you can’t succeed if you don’t try, and it helps to have a lot of luck – perhaps more so than talent…

Enjoy!

 

Is this the beginning of the end of programming middleman?

It seems that, with every passing day, the importance of traditional content distributors is on the wane. Nowhere is this more stark than the plight of sports programming. As the stock price of Disney continues to fight the inexorable gravity of ESPN’s fate, these kind of comments are exhibit A for the future of not just sports, but all content on the internet:

“The NFL is constantly looking to serve our fans premium NFL content where and how they want to see it,” said Hans Schroeder, senior VP, media strategy, business development, & sales for the NFL.

With the emphasis  now on OTT distribution and mobile devices, the status of ESPN and DirecTV’s NFL package are being seen as bloat. In the past, broadcast networks and cable stations were essential links to the public, today’s growing number of alternatives make these programming middlemen unnecessary. As stated in this article, the leagues can now turn to multiple distributors, such as PlayStation Vue:

“PlayStation Vue offers more than 100 live TV channels. It has deals with programmers including AMC, CBS, Discovery, Disney, Fox, NBCUniversal, Scripps Networks, Turner Broadcasting and Viacom.”

So, instead of set-top boxes turning to ESPN for sports, they can turn to the leagues themselves and eliminate the middlemen (and its accompanying fees) to provide the same experience with added savings. And I would think that it won’t be long before Warner Brothers Television, Alcon Entertainment, and the other myriad scripted content providers completely bypass the networks and just license their wares directly to OTT services, or other online streaming companies.

The shake-and-bake state of the media landscape…

Increasingly, the means of digital content distribution are being revised, altered and shuffled. As this article reports, cable providers are facing reductions in subscribers, and the outlook is not good. So what does this indicate?

It seems that, with every passing day, there is another video platform, phone app, or HDMI plug-in device that promise to wean you off of the exorbitant cable fees that you pay every month. First, it was telecoms, then it was Netflix, Hulu and Amazon, then it was the Roku stick and Chromecast. We are seeing a rapid fragmentation of how we receive video content, and that bodes ill for the traditional distributors.

A few things have transpired recently that hammer this point home. AT&T acquiring DirecTV, ESPN being a drag on Disney stock, Netflix and others producing more original content, and Twitter getting into a content deal with the NBA. This doesn’t even take into consideration the growing popularity of live-streaming, altered-reality gaming, and real virtual reality. As old-timers like myself become less important to the subscriber bases of legacy providers, and advertisers scramble to reach the youth demographic, money and eyeballs will migrate to new means of content delivery.

This is just the end of the beginning, if that. Things are moving very fast in this segment of the media, and a new, transformational technology is likely just around the corner. For now, I’ll go back to my DirecTV and watch some reruns…

One look at the future of digital media… on the sports page!

Being an almost-native Los Angeleno, I have adopted the Los Angeles Clippers as my hometown NBA team (sorry, Lakers). But in this LA Times article from the sports section of the newspaper, I was genuinely surprised to read about their negotiations and plans for airing/streaming their games in upcoming seasons. Their contract with Fox Sports has come to an end, and the new landscape of mobile viewing, digital streaming, and augmented screens have made it potentially much more complicated than in days past.

You really should read the article closely for mention of these considerations, but here is an excerpt which exemplifies the nature of what is involved:

Another possibility would be video streaming the game and the analytical data individually. A third alternative would be integrating the data onto the screen as part of the game feed.

What is conspicuously absent is any mention of virtual reality, which in light of recent acquisitions and investments, lead me to believe will be coming sooner than most expect. And if Time Warner’s awful experience with exclusive deals for both the Dodgers and the Lakers is any indication, I would expect all parties to be very sensitive about unnecessarily restricting viewership.

Finally, the quote I found particularly intriguing is this:

The content for the streaming feed would be produced independent of Fox through a third party.

It’s been my opinion that it was just a matter of time before the professional sports leagues and their owners realized that their share of the advertising revenue would increase substantially if they could provide it without the aid of a middle man. With companies like Facebook and Twitter providing live streaming, the necessity of a Fox or Time Warner falls to the wayside. Granted, at this late stage before the start of the 2016-17 season, it probably doesn’t make sense, but it is most certainly on the horizon.

In fact, the bigger question is whether the leagues themselves, or the owners individually, will become the producers and distributors of games and data. This explains much of the recent stock woes of Disney, which owns ESPN. Stay tuned.

Programmatic Advertising – what exactly is it, and how does it work?

If you spend any time in the marketing world, you have undoubtedly encountered the phrase “programmatic advertising” and – if you’re like me – scratched your head and pretended to know what it is. In an effort to educate my comrades-in-arms, I present to you a fairly thorough – if a bit dense – article on what it is and how it works.

You may have read about the ongoing battle between publishers and ad blockers. Since subscriptions are still a qualified success, and only in specific circumstances, digital advertising will continue to be an important part of any marketers toolkit.

“Although subscription video on demand (SVOD) and transactional video on demand (TVOD) have been successful, ad-supported content isn’t going away anytime soon, no matter the viewing device.”

In essence, it is an automated way for advertisers to identify potential customers based on their publicly available demographics and past buying behavior to target appropriate ads. The potential market is too big and the amount of work to reach them is too complex.

“In the ideal programmatic transaction, a user clicks on a website, and her internet address and browsing history are packaged and whisked off to an auction site. On behalf of advertisers, software scrutinizes her profile (or an anonymized version of it) and determines whether to bid for the right to place an ad next to the media she is about to view. If you’re looking for affluent women between 30 and 35 who own houses and dogs in a specific ZIP code in Dallas, you may hit a premium price. If you take a broader view—say, all viewers between 30 and 35—your pricing may go down, and the supply of viewers could go up substantially.”

This just scratches the surface, and you will need to be a bit patient in reading the article, but you may find that it gives you just enough understanding that you won’t feel left out when it comes to discussions of programmatic ad buying.

Good luck!

The trouble with advertising in the digital age

I was reading this article in the LA Times about how Hulu is integrating product placement into their programming, and then noticed an ad in the sidebar that was most certainly a function of a condition I have. I don’t talk about it, but have spent some time researching it on the web.

This got me thinking about something I’m sure we have all encountered. If you search for anything, you can bet that ads corresponding to your search will pepper every page that you see henceforth. Have toe fungus? You will see dozens of ads for Jublia and the like. Need a bathroom remodel? Every home improvement store and website will inhabit your web life for days to come.

Granted, there is a desperate effort to find ways to make money on the internet. Music succeeded (if you want to call it that) by licensing to legitimate sites like iTunes and Spotify. But ad blocking software is wrecking havoc on the publishing industry, and the DVR is proving problematic for networks (hence, the article mentioned above). It is also lifting the value of live, must-see programs, especially in sports. Just witness the deals that the NFL and NBA have signed recently.

Advertising is a necessary aspect of free programming, but we are very much in a transitional period where the blunt instrument of banner ads will continue to haunt us in our travels from webpage to webpage, until someone can figure out a way to do it better.

Any takers?