Weekly Digest from the West
Jean-Baptiste Piron
Cultural Attaché I Attaché culturel I Québec Office Los Angeles
-The 16 power players leading the rise of free ad-supported streaming services in 2019: https://www.businessinsider.com/power-player-execs-of-free-ad-supported-streaming-video-avod-2019-9
-The war for the world’s eyeballs will end in tears: Tech and media giants are going to war, pouring billions into competing streaming services. Apple and Disney are both about to enter the market, taking on established players such as Netflix and Amazon. Next year will see even more new entrants. In the clamour and confusion, viewers may rue the day their traditional television and cable packages were “unbundled”. The spending is immense. Apple has committed more than $6bn for original content, including movies and series such as The Morning Show, starring Jennifer Aniston, Reese Witherspoon and Steve Carell. In this expensive pivot to video, the iPhone maker is racing to catch up with Netflix, which already spends $15bn a year on content, including the $500m it just dropped on Seinfeld, a 30-year-old sitcom. Some investors are already concerned. Netflix has been playing this game for 12 years and secured an impressive slice of the world’s population — but still fails to generate positive free cash flow. Now the market leader is losing some of its best content, as new rivals such as Disney hoard it for their own services. Meanwhile, Apple can afford to outspend anyone and undercut them on price; the Apple TV Plus service is only $4.99 a month. Everyone has the potential to lose lots of money. The most obvious investor backlash in the sector is at AT&T, where Elliott Management has taken a stake in the venerable telecoms group and told it to stop wasting money on deals in a vain effort to rejuvenate itself. Included in AT&T’s $80bn takeover of TimeWarner last year was HBO, which is, inevitably, launching its own new streaming service next year. But even the sceptics might not be worrying enough. The danger is not only that the competing efforts cancel each other out. It is that younger audiences have zero interest in the stars from the 1990s, whom executives are so keen to sign up. Many younger viewers barely care about premium content at all. Instead they are fixated on short clips of home-made material consumed on the likes of YouTube, Snapchat and TikTok. Netflix boasts 152m subscribers. On YouTube a single personality, PewDiePie, has 101m subscribers for his cheap and controversial content. Some think this is a passing fad. Even Evan Spiegel, chief executive of Snap, a beneficiary of the boom in user-generated content, is betting on its decline. He said this week that “some of the content that people are consuming today on social media may actually be less interesting than more premium content going forward”. But he also thought we would all be wearing computerised glasses by now. Equally short-sighted is Twitter, which acquired Vine, an early leader in short user-generated videos, in 2012. As then-chief financial officer Anthony Noto put it with breathless enthusiasm: “It’s a great experience . . . It really hits a younger demographic. And we couldn’t be more happy to have that brand, that asset and that user experience in video.”
https://www.ft.com/content/24be6faa-dae2-11e9-8f9b-77216ebe1f17
-For Interactive OTT Ads to Come to Fruition, We Need a Solid Underlying Framework: Over-the-top (OTT) advertising offers marketers a chance to rewrite how television advertising works. And therein lies the industry’s greatest opportunity — and its biggest challenge. For starters, most agree that the rapid emergence of ad-supported OTT offers media companies and brands a much desired clean slate when it comes to ad formats. After all, why would you want to run the same old 30-second spots, and the same unwieldy ad loads in a medium that is increasingly on demand, right? If anything, as streaming continues to surge, consumer tolerance for interruptive ads continues to plummet. A generation raised on Netflix may be able to handle some ads, but they hardly have the stomach for 20-plus minutes of non-skippable breaks in a given hour. So, OTT advertising needs to be more respectful of peoples’ time, while taking into account their need for control. Leading OTT purveyors like Hulu inherently grasp this. The company has been a leader in testing new advertising units, such as ad pods that let users choose what brands they want to hear from, to “pause ads” and longer binge ads. Plus, Hulu counts down how many seconds are left during each commercial break, and caps each break at 90 seconds. Others in OTT are experimenting as well. Media companies like NBCUniversal are rolling out interactive ads in OTT. Networks like Fox are running very short ad pods. And Netflix, too, sees the value in interactive content, with last year’s “Bandersnatch,” choose-your-own adventure experience for Black Mirror. This is all great, right? Well…The problem is that advertisers historically always say they want “unique and custom” solutions, but they often don’t want to take the time and energy and money to follow through. It can be costly to create creative for these new, mostly untested formats. And while media companies can tout their “proprietary” ad placements — they also want ads they can sell in big numbers to everybody. And that’s why the 30 works. Every form of media needs standards. The industry saw this same dynamic play out a decade or so ago as web video came to prominence. Everyone screamed for customized ads made for the medium, plus some “interactive” video ads. But they ended up with 30s and 15s, for years.
https://www.broadcastingcable.com/blog/interactive-ott-ads-need-solid-underlying-framework
-Roku Shares Plunge Again as Competitors Loom: Shares of streaming-media firm Roku, already under pressure ahead of the launch of Apple TV+ and Disney+, plunged 19 percent after an analyst initiated coverage of the stock with a ? sell" recommendation and $60 price target, while it ended trading Friday at $108.02. In a Friday note, Pivotal Research Anyalyst Jeffrey Wlodarczak says his problem with Roku is that Comcast is giving some of its subscribers an Xfinity Flex box, an encroachment on Roku's business that could be copied by others and drive the price of OTT devices to zero. At the top if his note, the analyst asks: ? Is Roku Broku?" ? Everyone has realized the living room is too important and the big boys (led by Comcast) with massive leverage are likely to make Roku growth much more difficult," Wlodarczak says in his note. Wlodarczak praises Roku management for succeeding against competitors like Amazon, Apple, Google and Facebook, all of which sell devices for turning television sets into Internet streamers, but once the cable companies play hardball by giving such equipment and services away for free in order to keep consumers from cutting their cords, it will make Roku’s high-growth valuation seem absurd. The company's market cap at the end of trading Friday was $13 billion on the backs of 31 million households that generate about $3 per month in revenue for Roku, says Wlodarczak. The stock had been up 460 percent in just 10 months, but it has been diving since Sept. 2, down 36 percent since that day. If the cablers become aggregators of over-the-top services, essentially what Roku already is, it would not only generate profit for them, but also give them ? enormous leverage in content renegotiations," says Wlodarczak.
https://www.hollywoodreporter.com/news/roku-shares-plunge-again-as-competitors-loom-1241482
-Apple TV+ Ads Ruled the Emmys. Here’s What That Means for the Service’s Strategy: Apple TV+ is surely already looking ahead to next year’s Emmys, when its first slate of original programming will be in contention for awards. But the tech giant’s incipient streaming service, launching Nov. 1, made its presence very much known during this year's ceremony, peppering commercial breaks with brief and resolutely polished polished teaser spots for original offerings like Truth Be Told and Servant. The former, a true-crime thriller starring Aaron Paul and Octavia Spencer, centers on a podcaster who reopens her investigation into a murder after new evidence emerges that casts doubt on the conviction her original narrative helped to secure. And the latter, from M. Night Shyamalan, is billed as a TV mystery-box extension of his trademark, twist-heavy approach to storytelling. Apple's spots were consistent in emphasizing the company's focus on prestige storytelling; the crop of shows, toplined by award-winning actors and polished to a premium-cable sheen, suggested that Apple TV+ will aim to rival HBO more than Netflix. Their placement during the Emmys, furthermore, could be read as a statement of intention, a watch-this-space promise to premiere series to compete directly against the most Emmy-awarded content creators. Marketing during the Emmys—a unique kind of TV event watched by content distributors, industry professionals, and general audiences—is a no-brainer for TV entrants invested in making a creative as well as commercial splash with their original offerings.
https://fortune.com/2019/09/23/apple-tv-plus-commercials-emmys-streaming-strategy/
-Check Out the 13 Original Movies Coming to Netflix in October: Your only plan for October may be watching Hocus Pocus on repeat until Nov. 1, but when you see the new original movies Netflix has to offer this month, you may just have to revisit that plan. Along with a totally stacked comedy starring Eddie Murphy, a Breaking Bad movie sequel, and a highly anticipated crime flick starring Meryl Streep, Antonio Banderas, and Gary Oldman, among others, Netflix is delivering several new thrillers and chillers that are just waiting to give us nightmares. We dare you to check out these new originals coming to Netflix in October and tell us you’re not excited.
https://www.popsugar.com/entertainment/new-netflix-original-movies-october-2019-46645820
-Amazon creates a huge alliance to demand voice assistant compatibility: A day ahead of its annual fall hardware event, Amazon is making a big partnership announcement: it has created the Voice Interoperability Initiative, which is sort of a statement of intent from over 30 different companies that they will strive to ensure devices will work with multiple digital assistants at the same time. For example, you could talk to either Alexa or Cortana on the same smart speaker simply by saying the appropriate wake word. “As much as people would like the headline that there’s going to be one voice assistant that rules them all, we don’t agree,” says Amazon’s SVP of devices and services Dave Limp. “This isn’t a sporting event. There’s not going to be one winner.” Limp argues that if there will always be multiple voice assistants, they should work better together. A wide array of companies that build both software and hardware for voice assistants have signed on to the initiative. I’m just going to quote Amazon’s press release directly to give you some of the companies on the list because it’s clear Amazon is going for some shock and awe here, especially since the list includes a few major players. I’ve bolded some notable ones: More than 30 companies are supporting the effort, including global brands like Amazon, Baidu, BMW, Bose, Cerence, ecobee, Harman, Logitech, Microsoft, Salesforce, Sonos, Sound United, Sony Audio Group, Spotify and Tencent; telecommunications operators like Free, Orange, SFR and Verizon; hardware solutions providers like Amlogic, InnoMedia, Intel, MediaTek, NXP Semiconductors, Qualcomm Technologies, Inc., SGW Global and Tonly; and systems integrators like CommScope, DiscVision, Libre, Linkplay, MyBox, Sagemcom, StreamUnlimited and Sugr. he companies that are on board seem pretty chuffed, if the quotes they provided for Amazon’s press release are any indication. Intel said its 10th Gen chips will work with “multiple assistants this year,” and Qualcomm said its chipsets are capable of doing multiple wake words already. If you read between the lines of this statement from Andrew Shuman, CVP Cortana at Microsoft, you’ll find the gentlest possible nod to how Google and Apple have made their platforms unfriendly to third-party assistants: “We expect the initiative to help us expand this vision to even more companies and foster a balanced ecosystem that empowers companies to create and make their assistants available, on all platforms.” (Emphasis mine.)
-Discovery to Launch Food Network Kitchen Subscription-Streaming Service, With Amazon’s Assistance: Discovery has whipped up its most ambitious U.S. subscription-streaming concoction to date — Food Network Kitchen, which the company promises will be as useful to home cooks as it is entertaining. Set to launch in October, Food Network Kitchen will offer a lineup of 25 weekly live, interactive cooking shows — including some led by celeb chefs Bobby Flay, Rachael Ray, Giada De Laurentiis and Guy Fieri — as well as over 800 on-demand instructional videos, 80,000 recipes, culinary-related original programming and select shows from Food Network’s library. The service, to be priced starting at $6.99 per month, is built for utility: It will let subscribers order ingredients for specific recipes from online-grocery services (and eventually cooking supplies) and in 2020 will add a 24-hour culinary helpline for subscribers to get tips and tricks from live experts. In addition, Discovery inked a three-year pact to integrate Food Network Kitchen with Amazon’s Alexa voice assistant, to provide hands-free navigation while subscribers are prepping their dishes. Alexa is the exclusive voice service for Food Network Kitchen under the deal. “We think we can set a new bar in the direct-to-consumer world that goes beyond entertainment,” said Peter Faricy, CEO of Discovery’s Direct-to-Consumer business unit. “We’re going to stress the joy and fun — and also the practicalness — of this.” Discovery engaged with Amazon to stitch Food Network Kitchen into the ecommerce giant’s full suite of consumer-electronics products including Alexa, Amazon Echo Show, Fire tablets, Fire TV and Fire TV Edition Smart TVs. The service also will be available for iOS and Android mobile devices at launch, coming to additional platforms and devices in 2020 including Roku and Apple TV.
https://variety.com/2019/digital/news/food-network-kitchen-streaming-discovery-1203348667/
-Apple TV Plus, Disney Plus Will Enter Europe Playing Catch-Up to Netflix, Amazon: Apple TV Plus and Disney Plus are the next global streaming services slated to roll into Europe, joining Netflix and Amazon Prime Video in some of the world’s most lucrative markets. But along with the opportunities come local programming and investment obligations that the new players — including upcoming services Peacock and HBO Max — may struggle to meet. Chief among these is a requirement that their catalogs offer at least 30% European content by the end of 2020. It’s still unclear how that 30% will be assessed — according to number of hours or number of titles — but officials are expected to clarify the issue by the end of this year. “It’s going to be a challenge for the European Commission to come up with a fair system for the quota,” says Ed Border of London-based consultancy Ampere Analysis. Counting either by titles or hours could be open to abuse. Regardless, Netflix and Amazon Prime Video have a head start. The two streaming giants have known about the quota for more than a year and are close to achieving it, according to Ampere. Netflix and Amazon average about 5,000 and 3,000 titles, respectively, in European markets (except in the U.K., where the numbers are significantly higher). Going by number of titles, European works account for 20%-30% of the two platforms’ offerings in the biggest markets, thanks to a mix of acquisitions and original productions in countries such as the U.K., France, Germany, Italy and Spain. Disney Plus and Apple TV Plus won’t have nearly as much content at launch, but meeting the 30% threshold is likely to take a while. (Reps for the two companies did not respond to requests for comment.) Ampere estimates that Apple TV Plus will bow in Europe with 38 titles, including movies and seasons of TV series, only 6.2% of which are from Europe. Disney Plus is expected to launch with about 982 titles, 4.7% of which are from Europe. Apple TV will rely on original content to make up the shortfall, industry sources say. “Unlike Netflix and Amazon, which have been doing a lot of acquisitions to bulk up their libraries, Apple TV’s strategy in Europe looks as if it will be to focus on making a select amount of original films and series with big stars and creatives attached,” says Tim Westcott of IHS Markit. “If they take all the rights, they can roll out the titles globally instead of acquiring shows for specific markets.” European titles in negotiation to join Apple TV’s pipeline include “Faceless,” a thriller produced by France’s Leonis and Britain’s Artists Studio and co-written by Virginie Brac (“Spiral”), and an English-language period series also produced between Britain and France. Apple also has an animated show in development with Gaumont. Disney Plus’ approximately 1,000 titles are expected to include 25 original series and 10 original films during the first year, notably “The Mandalorian” and the reboot of “Lady and the Tramp.” Disney is likely to make some acquisitions in Europe to fill the quota but will also be banking on originals. The company is looking to hire a programming director for Disney Plus Europe and Africa, according to a recent job ad posted on LinkedIn.
https://variety.com/2019/tv/news/apple-tv-plus-disney-plus-netflix-amazon-europe-1203349806/
-Why Sony and Marvel sharing Spider-Man could be a win for everybody: Those cheers you just heard? That was the sound of millions of Spider-Man fans celebrating the news that Marvel Comics’ beloved web-slinger is likely to get at least one more movie set within the Marvel Cinematic Universe. Sony Pictures and Disney’s Marvel Studios are reportedly near an agreement to team up for another film featuring Tom Holland as Spider-Man that will unfold in Marvel’s interconnected movie-verse. The news arrives mere weeks after a highly publicized split between the studios that would have ripped Spider-Man out of the MCU — his home since the franchise was rebooted and Holland took over the role — for the foreseeable future. But now Spider-Man is, reportedly, back in the mix in the MCU — and if the two studios play it smart, it could make the web-slinger bigger than ever. In the report detailing the studios’ move back to the bargaining table, Marvel Studios President Kevin Feige — the producer on Spider-Man’s MCU films and architect of the cinematic universe — hinted at the character’s unique, universe-hopping potential. “[Spider-Man] happens to be the only hero with the superpower to cross cinematic universes, so as Sony continues to develop their own Spidey-verse, you never know what surprises the future might hold,” teased Feige. That one sentence offers a lot to unpack for anyone familiar with Spider-Man’s current big-screen environment. While Marvel has a well-established (but still rapidly expanding) cinematic universe, Sony has also been hard at work laying the foundation for its own interconnected Spider-verse (not to be confused with the animated movie of the same name). Last year’s Venom managed to be a box-office hit despite poor reviews, and a sequel to that film is on the way. The studio also has a film based on the vampire antihero Morbius in the works with Jared Leto cast in the lead role, along with projects in development based on a long list of supporting characters from Spider-Man’s corner of the Marvel Comics universe, including Kraven the Hunter, Madame Web, Black Cat, and the villainous team known as the Sinister Six. That’s all in addition to the concepts introduced in the studio’s aforementioned Oscar-winning animated feature Spider-Man: Into the Spider-Verse, which had various Spider-themed heroes from different universes teaming up for an adventure. Given Sony’s desire to establish its own superhero universe, it’s not difficult to see how another movie set in the MCU could benefit both studios — and tie up some of the messy loose ends Spider-Man’s sudden exit from the MCU would have created.
-Former ESPN Chief Skipper on the Future of Cable Sports and Role of Streaming: ESPN’s former chief John Skipper, now running a global streaming service focused on sports, remains bullish on the future of national cable services like those run by his former employer. But he is pessimistic about regional sports channels, those broadcasting local baseball and other sports, which he says face a “fierce battle” to stay in cable bundles in the future. Getting dropped would drastically reduce their revenue. He argues that regional sports channels—such as the Fox channels recently acquired by Sinclair Broadcast Group for $9.6 billion—would be ideal to operate as streaming services. That might explain why Amazon invested in one such channel, the Yes network. But his view highlights the challenges facing traditional TV networks as the industry shifts to more of a streaming approach.
-Facebook says it will build AR glasses and map the world: Facebook has confirmed (yet again) that it’s building augmented reality glasses, and it announced a project called “Live Maps” that will create 3D maps of the world. At the Oculus Connect developer conference today, Facebook augmented and virtual reality head Andrew Bosworth said the company had “a few” prototypes of AR glasses, although he didn’t offer details about them. Facebook also described Live Maps in aspirational terms. According to a video, it will produce “multi-layer representations of the world” using crowdsourced data, traditional maps, and footage captured through phones and augmented reality glasses. The video shows familiar potential uses — like getting notifications projected in thin air, identifying objects with labels, or even projecting a holographic avatar to hang out with real people. It’s not totally clear how (or if) Facebook would protect privacy while collecting all of this data. After all, Google’s Street View system, which also captured data about the physical world, raised troubling legal questions. We’ve seen companies like Magic Leap, Microsoft, and Google offer similar ideas, and Facebook has promoted phone-based augmented reality with its Spark AR system. Facebook has also mentioned several times that it’s building AR glasses, and last week, rumors circulated that it’s partnering with Ray-Ban maker Luxottica on one of multiple codenamed prototypes. Oculus Connect is just getting started, so it’s possible we’ll hear more about Live Maps later at the conference.
https://www.theverge.com/2019/9/25/20883706/facebook-ar-glasses-prototypes-live-maps-announce-oc6