Showing posts with label SVOD. Show all posts
Showing posts with label SVOD. Show all posts

Wednesday, May 8, 2013

Google, Yahoo Interest in Pay TV?

News reports suggest that YouTube (owned by Google) is getting ready to charge for access to some of its specialty channels, and Yahoo has been in contact with Hulu about a possible bid to buy the premium video service.

Hulu has been on and off the market for the last few years.  When its owners first tried to auction off the service, deals fell through when networks wouldn't commit to continuing to license their content to Hulu.  This dropped the value of the service significantly, well below what the owners sought, so Hulu was pulled off the market.  A few months back, the network owners once again said they'd be open to selling the service, a number of groups expressed interest (including Amazon). 
  Yahoo has been seeking entry into the subscription video on demand (SVOD) market recently.  It had a deal in place to purchase a majority stake in Dailymotion (a video streaming service owned by France Telecom) - until the French government vetoed the idea of foreign majority ownership.  Reports have Yahoo's CEO Marissa Mayer, making initial contact with Hulu execs; but any talks are still in the early stages.  Yahoo's, and Mayer's, interest in online video was evident at a recent Wired conference:
“I think video is really important … video is something that we’re all innately designed and born to experience, everyone is born being able to watch and to hear,” she said. “Video is just this amazing format.”
 YouTube is already the biggest player in online video, but as a free hosting and streaming service.  What's new is a story in the Financial Times that states the service is ready to implement a pay wall for select specialty channels - possibly within a few weeks.  The official YouTube response to the story was that there was "nothing to announce" at this time - well short of a denial.  What YouTube insiders told the FT reporters was that YouTube was
“looking into creating a subscription platform that could bring even more great content to YouTube for our users to enjoy and provide our creators with another vehicle to generate revenue from their content, beyond the rental and ad-supported models we offer.”
  What that suggests is that the service is exploring, and probably already developing, a subscription / pay wall system that could be applied to specific channels/content providers.  The system might help some high-demand YouTube specialty channels with revenues, but it's more likely that YouTube wants the system in place to help attract new premium content channels such as movie studios and sports leagues.  In other words, those content creators that are now licensing content to various SVOD operators, and are thinking about cutting out the middleman and marketing direct to viewers.
  YouTube was quick to calm fears, promising that the vast bulk of user-generated videos would remain free.

I see these as reflecting the growing awareness of the importance of online video and licensing in the expanding TV viewing marketplace, and moves to help online  services position themselves to take advantage of that corner of the market as it expands.

Sources -  Yahoo's Mayer Has Met With Hulu Execs in a Preliminary Look-See at Premium Video Unit,  AllThingsD
Would Consumers Pay For YouTube Channels?,  VidBlog

Tuesday, May 7, 2013

Off Net to Online - Starting the Revolution

A couple of recent items in support of Friday's post on TV shows moving off broadcast networks.

Soaps - Last week saw another first, as two historic soaps renewed  their story lines online, after being cancelled by their broadcast networks.  New episodes of All My Children and One Life to Live are now being produced by Prospect Park's The Online Network, and are available on Hulu, HuluPlus, and iTunes.  Each of the shows is returning with much of its cast and creative talent intact, familiar sets (although those needed to be rebuilt in their new studio digs), and continuing many long-term storylines.  And they're maintaining their high production values.
(As) far as soap operas go, the new “AMC” and “OLTL” look like the real deal: handsomely executed television series that just happened to be produced for online viewing.
  There are some significant differences - new episodes run 30 minutes, and come out only four times a week.  Moving off broadcast has also freed the shows from the strictures of FCC "indecency" regulations, allowing them to embrace the greater latitude that cable and pay cable programs are exploiting.
Right out of the box, the kids are running around without clothes on during “AMC,” and cursing up a storm on “OLTL.” (On “OLTL,” s-bombs are dropping over Llanview like ducks from the sky during hunting season.)
Commentators suggest that the new shows are once again skating along the cutting edge of soaps, perhaps seeking to entice younger viewers who have grown up watching the less-regulated content of cable and Internet, while maintaining the familiar characters and plots that might just entice older fans and viewers online. 

Production Model -  Talking about Amazon's new political comedy series Alpha House on a cable talk show with producers Jonathan Alter and Garry Trudeau, advertising mogul and TV commentator Donny Deutsch let it slip -
“You guys are on the front line of a revolution,” Deutsch said.
The subscription video-on-demand (SVOD) model embraced by Netflix, Hulu, and Amazon (among others) could have a huge impact on the future of original content creation and distribution - not only as a new (and booming) revenue source, but in large part because it's a different business/production model.
“It feels a little bit like those folks in the early '50s at the beginning of the era of television or in the early '80s at the beginning of cable TV,” Alter said. “Online TV is coming. It’s coming really fast and it’s going to be great for viewers.”
 The historic TV program business model emphasized general-interest programs for the casual viewer (and advertisers), and high-overhead, heavily unionized, and increasingly expensive studio production. (On a per-episode basis, a half-hour sitcom can cost $1-3 million; an hour drama $2-5 million; a two-hour TV movie $7-15 million). It's a high-cost but potentially high-reward strategy.
  In contrast, the business model for SVOD emphasizes niche programming for the dedicated viewer - the kind of viewer who will pay for access to the show, and devote a weekend to watching a full season of shows, and come back again and again and again.  In other words, the engaged, dedicated, fan.  In addition, SVOD distributors (like many cable networks) are not tied to the Hollywood studio model for production, and can take advantage of declining costs of digital production and less costly locations.  As Trudeau said during the talk show -
"But now there is this perception that content can be made anywhere. Obviously, the provider has to have deep enough pockets, but TV shows are now seen as kind of the new novel. Anyone can make it. As long as it’s of a certain quality, people will go find it.”
  An emerging advantage for niche programming is the potential to use crowd-sourcing for initial funding and testing.  Amazon's testing that approach with some of its candidates for new original movies and series - with pilots airing on Amazon Instant Video to gather viewer feedback and response.  Then using that feedback to tweak content and select which go into full production
"That form of implicit feedback is as useful, or more useful sometimes, than the explicit feedback," (head of Amazon Studios Roy) Price said. "This told us something about the marketability of these ideas."
Amazon Studios recently turned "Blackburn Burrow," a movie script by screenwriter Jay Levy, into a digital comic to get more consumer input.
Between the lower costs of digital production and distribution and the higher value placed on programs by dedicated and/or engaged viewers, the threshold for success online (and on cable networks) is much lower than it is for the Big Four broadcast networks. And it doesn't hurt that niche audiences can attract premium rates for targeted markets.

  The TV program market is changing, evolving, and expanding.  Digital innovation is having a significant impact on program production costs and removing barriers to entry; digital distribution is opening new markets and revenue sources; and advertisers are taking advantage of niche programming and targeted audiences.

   Vive la Revolution!

Sources -  Are Online Versions Of 'All My Children' & 'One Life to Live' TV Game-Changers,  TV Board
Netflix, Amazon Could Impact Original Content Ecosystem, TVBlog
Crowdsourcing goes to Hollywood as Amazon makes movies,  Reuters