Weekly Digest from the West
Jean-Baptiste Piron
Cultural Attaché I Attaché culturel I Québec Office Los Angeles
-Can Katzenberg’s NewTV crack the code for mobile video where others have failed? Why is the mobile-first streaming video landscape a graveyard populated by some of the biggest brands in tech, media and advertising? Hollywood mastermind Jeffrey Katzenberg thinks he has the answer and will throw hundreds of millions of dollars at content creators to prove it. But figuring out what mobile viewers want could take more than that alone. The exponential growth of mobile video consumption — which represents about 60% of all online video — has made it an irresistible market for creators, platforms and advertisers, albeit one that no company has been able to master so far. Samsung, Comcast, Spotify, Vimeo and more recently Verizon and Vivendi are among the major players that have entered and quickly exited the field. Despite the red flags, investors have lined up to support NewTV, the new streaming mobile venture from WndrCo, a holding company co-founded by former Disney and Dreamworks heavyweight Jeffrey Katzenberg. In early August, Katzenberg and NewTV CEO Meg Whitman, the former CEO of HP and eBay, announced that the venture had secured $1 billion in funding. Investors include the parent companies of the "Big Six" film studios — Disney, 21st Century Fox, NBCUniversal, Sony Pictures Entertainment, Viacom and WarnerMedia — along with Chinese internet giant Alibaba. Time will tell if the combination of Hollywood moxie and big tech know-how will help NewTV succeed. Investors clearly believe there's money to be made in mobile-first video streaming platforms. But for NewTV to succeed where others have failed, it’ll have to figure out the short-form video format, walking a line that puts it between social streaming services like Facebook Watch and video platforms like Netflix.
-Jeff Bezos is going to create schools where ‘the child is the customer’: A year after asking for suggestions on philanthropy, Amazon founder Jeff Bezos is unveiling his first projects. The highlight will be the creation of a network for nonprofit preschools that are to be built in low-income communities and accept students at no charge. Bezos also intends to fund existing nonprofits that help homeless families by providing access to housing and food. Both initiatives will be overseen by something he’s calling the Bezos Day One Fund, which he’s committing $2 billion toward. Each of the initiatives will have a specific group behind it: the Day 1 Families Fund and the Day 1 Academies Fund. The Families Fund will issue grants on a yearly basis to organizations doing “needle-moving work.” The Academies Fund will be in charge of launching and operating a network of schools entirely on its own. Bezos says they’ll be “high-quality” Montessori-inspired schools that offer “full scholarship,” seemingly to all students.
https://www.theverge.com/2018/9/13/17855358/jeff-bezos-day-one-fund-nonprofit-preschool-amazon
-Streaming startup Caffeine perks up with $100 million from Fox to make Twitch shudder: 21st Century Fox has invested $100 million in Caffeine, a live-streaming social startup that focuses on gaming and entertainment. Fox’s investment bolsters Caffeine’s previously reported funding of $46 million from investors Andreessen Horowitz and Greylock Partners. Caffeine also announced a deal with Live Nation to include live concerts on its platform later this year. Caffeine, which was created by two former Apple execs and launched earlier this year, aims to nudge its way into a space already dominated by Twitch and YouTube by touting what they believe to be a simpler interface and a creator-first mentality. The former checks out, with the platform’s built-in tools to make live-streaming gameplay easier than having to download third-party software. The latter just seems like the Pollyanna-ish viewpoint every social platform likes to espouse. What’s really worth keeping an eye on is the partnership with Live Nation.
-The new DC Universe streaming service is a nostalgic trip for fans — even without original shows yet: DC’s new streaming service doesn’t have any new shows yet — but that shouldn’t stop you from having a good time with it. During a beta version tryout, DC Universe revealed itself to be a fun, nostalgic digital experience. The service is a one-stop-shop for the live-action and animated TV series and movies that DC has produced over the years — and even DC’s comic books (more on that later). You can watch episodes of Lynda Carter’s 70s “Wonder Woman” television series and Christopher Reeve’s iconic “Superman” movies. If you enjoy John Wesley Shipp’s supporting role on the CW’s “The Flash” you can watch the ’90s CBS series of the same name, back when Shipp starred as the Scarlet Speedster and muscle suits seemingly had no limits. No ’90s superhero television stream would be complete without ABC’s “Lois and Clark: The New Adventures of Superman,” starring Dean Cain and Teri Hatcher. DC Universe has all four seasons (87 episodes) of the campy and romantic series. Perhaps DC Universe’s strongest offering, at least for now, is the animated section. It features a wide variety of DC’s underrated straight-to-home-video movies, including the spectacular “Green Lantern: First Flight” from 2009, which makes you wonder how they could have gotten the live-action movie so wrong with this film as an animated template. The crown jewel of DC animation, “Batman: The Animated Series,” is there, as well, although the beta version had only the first two seasons. That makes sense, since Warner Bros. Animation is preparing to release the entire series in high definition on Blu-ray for the first time on Oct. 30.
-Traditional pay-TV still dominates live sports: As the autumn sport season begins in the US, research has revealed that cable, satellite and IPTV still play crucial roles in live sports distribution – and fans don’t want to pay more for different viewing experiences. According to CSG’s Digital Future Report: Sports Streaming Edition, the majority (71%) of global consumers watch live sports through cable subscriptions, with digital channels like streaming or mobile trailing at 18% and 11% respectively. They prefer to enjoy the game at home (69%) compared to bars/restaurants (14%) or stadiums (8%). Fans are also committed to the experience: Nearly two-thirds (59%) of fans will watch the full game, regardless of how long it may go. However, some sports have seen declining viewership via traditional channels, including the NFL. And while next-generation viewing options familiar from the streaming world should in theory offer new engagement opportunities and monetisation upside for what has been a static business for decades – think less intrusive ads, multi-game or split screen access, access to personalised content and extras such as stats or virtual-reality camera angles – most consumers aren’t interested upgrading their packages to receive them. When asked what types of services they would be willing to pay more for, 64% of respondents say that they would not pay extra for any of these features. Of those that would pay extra, less intrusive advertising was the most popular choice at 18.5%.
-Starz Passes 3 Million Streaming Subscriptions In U.S.: Starz has passed 3 million subscribers in the U.S. on its stand-alone streaming app, Lionsgate CEO Jon Feltheimer confirmed this morning during the company’s annual shareholder meeting in Toronto. That figure, which is up about 1 million from a year ago at this time, does not include more than one million subscribers across international platforms and through partners. With the $9-a-month service rolling out overseas and boosted by partnerships with Amazon and Hulu, Starz chief Chris Albrecht said last month it could soon be “right there” with rival HBO Now, which has about 8 million global subscribers. “At Starz, we spent the year continuing to invest in content for African-American, Latinx, female and LGBTQ audiences,” Feltheimer told shareholders, according to a transcript provided to Deadline by the company. He name-checked shows such as Vida, Sweetbitter, Outlander, American Gods and Power. “The result is that demand for Starz content is greater than ever, driving growth in traditional, over-the-top, and international subscribers.” Feltheimer hit on efforts in the film and television production divisions, asserting that 90% of the company’s films turned a profit in fiscal 2018. Lionsgate also has 60 TV shows in production in 12 global territories, he said, making the company “a prolific intellectual property machine.”
https://deadline.com/2018/09/starz-passes-3-million-streaming-subscriptions-in-u-s-1202462200/
-AT&T CEO Compares HBO to Tiffany, Netflix to Walmart: Netflix is like the Walmart of subscription video — while HBO is Tiffany & Co., according to Randall Stephenson, AT&T’s chairman and CEO. Stephenson also said AT&T is looking to launch a new direct-to-consumer model for WarnerMedia (the former Time Warner), built around the Warner Bros. content library and including content from HBO and Turner Sports. The company plans to reveal more details of the new direct-to-consumer streaming plans in the fourth quarter of 2018, he said, speaking at the Goldman Sachs Communacopia conference in New York City. The new direct-to-consumer business initiative for WarnerMedia, led by CEO John Stankey, will “bring all the assets AT&T to bear,” said Stephenson. The AT&T boss suggested that HBO is the crown jewel in the WarnerMedia portfolio — literally, likening the premium programmer to the Tiffany luxury jewelry and goods retailer. “HBO is a very unique brand,” Stephenson said. “I mean what I said, it is the Tiffany’s of media and entertainment.” Observers immediately pointed out that Walmart, with $486 billion in revenue last year, is 100 times more massive than the high-end Tiffany & Co., which reported $4.2 billion in sales for 2017. Meanwhile, Walmart itself is working up plans to launch a subscription VOD service.
https://variety.com/2018/biz/news/att-ceo-randall-stephenson-hbo-tiffany-netflix-walmart-1202937987/
-Netflix ‘could lose a quarter of subscribers if it introduces ads’: Netflix could lose a significant amount of subscribers if it introduces adverts during its programming. Hub Entertainment Research questioned 1,612 US TV consumers from ages 16 to 74 who watch at least an hour of TV per week and have broadband at home. Their report found that almost 25 per cent of respondents said they would stop using the streaming service if it began running ads during Netflix content. Netflix currently has 130 million subscribers worldwide. Asked if they would still use Netflix if it reduced the price of a monthly subscription to $3 a month as part of including ads on the service, 16 per cent of those surveyed said they would still cancel their Netflix subscription. Half of the respondents said they would probably stay with the service under the hypothetical scenario, and 25 per cent said they definitely would keep it.
https://www.tvtechnology.com/news/netflix-could-lose-a-quarter-of-subscribers-if-it-introduces-ads
-Forget the new iPhones: Apple’s best product is now privacy: When my friends come to me asking which smartphone or laptop they should buy, I almost always recommend an Apple product–the latest iPhone or MacBook. I recommend these products not just because they are Apple’s best, but because as someone who covers technology for a living, I believe that for most people, Apple offers better products and solutions than its competitors. Yes, Apple’s products are more expensive than many, “but you get what you pay for,” I frequently explain. In the case of iPhones, they generally have the fastest smartphone processors on the market, sport arguably the best industrial design, and have the most refined and stable operating system. I attribute similar qualities to Apple’s MacBooks, although my recommendation for those also include the line, “you’ll pay a little more up front, but they’ll last you twice as long as a PC laptop.” Of course, this week Apple introduced its newest iPhones, the iPhone XS, XS Max, and XR. Once again, journalists, analysts, and armchair Apple pundits have taken to social media to state that the new iPhones are Apple’s best products ever. Yet I no longer think this is a true statement. I now believe the best product Apple offers is intangible, yet far more valuable than a flagship smartphone. The best product Apple has–and the single biggest reason that consumers should choose an Apple device over competing devices–is privacy. In 2018, no issue is more important than user privacy–or the lack of it. We’re tracked by private industry on an unprecedented scale, with major corporations having so much data about us–much of it gleaned without our knowledge–that they can tell when a teenager is pregnant (and inform the teen’s father) or even predict your future actions based on decisions you haven’t made yet. If you want to be part of this world, designed by advertisers and tech giants, you must relinquish your right to privacy. In other words, we live in a commercial surveillance state.
https://www.fastcompany.com/90236195/forget-the-new-iphones-apples-best-product-is-now-privacy
-The second blockchain bubble is now complete — what’s next? The last few months haven’t been easy for crypto investors. Following the dizzying highs of crypto trading late last year, which saw Bitcoin reach a peak of $19,276 and a market cap of $323 billion and Ether reach $1,152 with a market cap of more than $112 billion, prices have crashed. Today, Bitcoin trades at around $6,500, and Ether at $204. Their combined market caps have shed about $300 billion in value. That’s basically five Bernie Madoffs worth of losses. The situation has put crypto investors in quite the bind. As one indicative example, The Wall Street Journal profiled wunderkind crypto investor Olaf Carlson-Wee, who founded Polychain Capital. The fund, which has seen dizzying growth over the past few years turning a few thousand dollars into tens of millions in returns, has lost about 40 percent of its $800 million in capital through investment losses and investor withdrawals. It’s clear the second blockchain bubble is now complete (the first was the run-up in Bitcoin prices in 2013). The question is: What’s next for blockchain? To me, several veins of research and development around blockchain remain deeply exciting, if we have the patience to see them through. They are:
? Identity: I’ve written about projects like Element and Learning Machines before. There are incredible challenges around how to offer portable and secure identities to every human on earth, to say nothing of every animal and physical object. Blockchain seems like technology that might be able to help here, if we are able to figure how to connect the digital world to the analog one. Facebook was once considered to be the identity layer of the internet — a claim that it has failed to live up to. Blockchain may ultimately arrive to complete that mission.
? Decentralized web: I was fortunate to catch up with Jutta Steiner of Parity Technologies last week at TechCrunch Disrupt and also host her at our event in Zug this past July. She and others like Gavin Wood have done a lot of work to start thinking through how chains can interact, as well as how to rebuild our modern web infrastructure in a decentralized way. Their ideas — like everything in this new world — are very early and inchoate, but they are inspiring in their potential. While centralized servers have huge performance advantages over decentralized technologies today, there’s no reason why that gap has to be permanent. Web3 and other projects could lead the way to pushing this model forward.
? Security Tokens: Can blockchain technologies help us build a safer, more efficient financial system? I am reminded of the piece by Matt Levine of Bloomberg on the shareholder votes to take Dell private and the massive level of indirection and complication it illuminated when it comes to ownership in our modern economy. Security tokens could provide a means to manage that complexity in a much more fluid way, particularly in a world where sharing is increasingly the norm around fixed assets (autos and Uber, homes and Airbnb, etc.)
https://techcrunch.com/2018/09/13/the-second-blockchain-bubble-is-now-complete-whats-next/