[opendtv] Re: B&C: Analyst: Video’s Future Is Omni-Channel Content
- From: Craig Birkmaier <brewmastercraig@xxxxxxxxxx>
- To: opendtv@xxxxxxxxxxxxx
- Date: Sat, 24 Sep 2016 08:26:45 -0400
On Sep 24, 2016, at 12:24 AM, Manfredi, Albert E
<albert.e.manfredi@xxxxxxxxxx> wrote:
You missed it, Craig, going back to your old saw. This shows that in spite of
a lack of a companion "linear stream," and in spite of a supposedly much
lower cents per viewer per hour figure, the SVOD content is STILL generating
more revenues than the dropped MVPD programs lost.
Great news for the content congloms, as this revenue goes straight to their
bottom lines. What YOU are missing is that this shift is causing consumers to
spend even more for pay TV.
There is no net loss. The ad supported linear TV services have seen a small
decline that is more than made up for by the large increase in subscription
revenues for the SVOD services.
So what happens if people continue to pay for both Bert?
What if live linear remains fairly stable, with small YOY advertising rate
increases, and people pay more to add a SVOD service?
shows that many people don't need that linear stream at all, and that
popularity of these programs trumps any old rules about cents per viewer per
hour. With less, they still manage to make more.
It says nothing of the sort. It says that people now have more choice in terms
of what they watch at any given time. If there is a live linear show they like
they will still use the MVPD service. If they want to watch an old TV series,
or one of the new original shows on Netflix they have that option now as well.
This is not the zero sum game that exists in your head. We are NOT moving to a
new TV delivery system where everything is consumed on demand. At best, we may
be moving to a system where everything is streamed, with a mix of live ad
supported streams, ad supported VOD streams, and ad free SVOD streams.
MVPD subscriptions are not level. They are declining. The more these legacy
channels demand, the more subscribers they are losing. And people flock to
sites with no linear streams. Plus, don’t forget, people continue to
subscribe to bundles they hardly use. Which magnifies the point about old
rules of thumb being obsolete.
Sorry, but the stats do not support this view. Live linear viewing still
dominates. Cord cutting is slowing, and in some cases reversing. What we will
see over the next few years is significant subscriber churn, as people choose
to drop the local MVPD bundles and move to one of multiple VMVPD services that
are better tailored o their needs (and cheaper).
I ignored that? You aren't paying attention, Craig. Read again what I just
wrote, since you missed it the first time around.
Yes, ignored that. You failed to mention the reality that revenues from the
SVOD services are a small fraction of what the content congloms make from the
live linear streams. Instead you tried to tell us they are making more from
SVOD. As I explained, this is money coming in over the transom.
More than made up. It's safe to assume that when people drop a legacy bundle,
they are taking up the online on demand alternative(s).
Really. It's not possible that they are just choosing to watch less TV?
And what if they cannot afford the MVPD bundle OR Broadband?
And sure, some will keep both, but the trend lines are not that way.
Wrong. More than 50% of U.S. Homes now subscribe to both. MVPD service still
reaches 83% of U.S. homes and SVOD services like Netflix, HBO Now etc all are
still growing.
The trend lines are decline in linear, decline in MVPD bundles, FLAT use of
PVRs for time shifting, and INCREASE in online streaming. The live linear
channel is simply not what people are chasing after, EVEN IF the old rules of
thumb might have said they are.
Hem please explain why more than 80% of the hours people spend watching TV are
live linear rather than streaming...
I repeat, since you missed it: don't get hung up on old formulas for what
makes more money. Those are formulas from years and decades gone by.
Correct. As always we are seeing revenue shifts as viewers are offered more
choice and viewing options. This started with VHS rentals in the '80s.
The growth of TV Everywhere is adding to the confusion,
That growth is among the generally declining legacy MVPD subscribers. It does
make the point that people want to use multiple non-legacy-TV appliances, and
I suspect that it also reinforces the point that MVPD subscribers are getting
away from the linear streams. I think TVE is used mostly for on demand
viewing.
It is a significant enhancement to the value if the MVPD bundles, and may be a
factor in the slowing rate of cord cutting. It's not just a case of wanting to
use non-legacy-TV appliances, although the ability to access content while
mobile or away from home is very important. We watch more hours of TV
Everywhere on our big screen (via Apple TV) than we do when away from home.
Some of this is viewing library programming on demand, and some is live streams
that may not be available in our market. ESPN now streams many college football
games that are regional feeds.
The adjacency referred to here is the use of more than one device
simultaneously, and leveraging the opportunity. It is someone with
the TV turned on to a live linear stream who is using a mobile
device at the same time.
And I'm saying, she is trying desperately to hold on to old notions. That
"adjacency" with the linear stream is something that the industry keeps
wanting to believe, but it isn't so.
Bull. There are all kinds of reports about the use of social media in
conjunction with viewing live programming. The networks are setting up all
opportunities for people to tweet questions/reactions related to programming,
and Facebook is heavily used by friends while watching shows...these social
interactions are also responsible for time shifted viewing when someone tells
friends to watch a specific show or episode.
People drop the linear stream and go in such numbers to the online
alternative that, in spite of lower cents per head per hour, and in spite of
momentum keeping the faithful subscribed to old schemes, the online
alternative is raking in bigger revenues than what the legacy model is losing.
No Bert. You are twisting facts again.
Yes, the revenues from SVOD have more than made up for revenue losses due to
cord cutting. But they are nowhere close to the revenues derived from the
broadcast networks and the live linear streams delivered by the MVPDs.
This says more about the stability of the pay TV business than any real
decline. It's just a reflection of the marketplace options available today. In
the end the American public will continue to spend as much or more for TV than
they do today.
So this should give you a clue of how popular the online alternatives must
be. (Also, you do know that you can watch an online stream with one device,
while doing something else with a different IP device, right? You don’t need
a ,inear stream for that, Craig. Old notions.)
What's your point. Whether the big screen is being fed from the legacy MVPD
pipe or broadband is irrelevant. You are still doing something on a second
device. Or maybe you just have a video window open on your PC at work, while
designing some new communication gadget for the Navy.
Not very insightful or surprising. People may well bail out completely,
rather than go to skinny legacy bundles.
That's not what she said. She said most people will continue to buy the larger
MVPD bundles. She said NOTHING about people bailing from MVPD service.
What she did say is that large bundles will continue to be popular - both MVPD
bundles and SVOD bundles.
And the fact that Netflix also aggregates is almost a banality. We have
covered this a ton of times. Unless you pay per episode, any OTT site
aggregates content, Craig. And it doesn't even hint that legacy subscriptions
continue to decline.
Paying per episode is also very popular. Since we dropped Netflix we have been
buying more movies from iTunes. The popularity of Netflix lies in part on the
depth of the old library shows available, and in part on new original content;
the lack of ads is another MAJOR factor. This is analogous to HBO Now, which
has depth in motion pictures, and many popular original shows.
And then you go on repeating your usual mantra, which ignores all the trend
lines and ignores even what new info this article provided.
I just ignore your imaginary trend lines Bert...
Regards
Craig
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