Advanced Advertising Summit panel “The Local View” looked at TV stations and cable operators reaping revenue on their digital and over-the-top platforms. Local advertising on linear TV is in a good spot, the panelists said, and OTT adds to the take. 

“What we like to focus on is the tremendous broad reach of broadcast,” said Christopher Martinez, Hearst Television OTT director of sales. “Linear and OTT working together has revitalized the need for local.”

Also: More Coverage from the 10th Anniversary NYC TV Week

Jon Lafayette, business editor of B+C Multichannel News, moderated the panel. 

Jim Loughran, senior VP of convergent video partnerships at Viamedia, acknowledged the cord-cutting issue and said, “broadcast and cable have huge reach and it’s not going away.“ Adding OTT to the local mix, he added, “makes the reach excellent.”

Kristin Wnuk, director of local sales at Roku, mentioned the measurability of OTT. “CTV and OTT absolutely gives clients the opportunity to extend their reach,” she said. “It also gives clients the opportunity to measure differently.”

Carol Hinnant, Comscore chief revenue officer, said there are “too many siloes” in terms of measuring viewing on the various platforms. “That is definitely the challenge,” she said.

Loughran mentioned how some clients don’t understand the value of some of the advanced measurements available to them, including cross-platform attribution. “People are very comfortable with doing things the way they’ve been doing them for a long time,” he said, adding that it’s on the salespeople to tell the story well.

Hinnant agreed. “That’s the key word, educating,” she said, “The desire to have better metrics is there.”

Wnuk said most everyone in television is trying to bridge the gap between linear and digital. “We are at a time when not all ad impressions are created equally,” she added.

When Lafayette asked about hot ad categories, the panelists mentioned the chip shortage continuing to slow down auto sales, but said other categories have bumped up. Loughran mentioned COVID testing and vaccine centers, cannabis, sports gambling and solar energy ramping up spending. “You have things that didn’t exist before,” he said.

Political spending, the panelists noted, remains red hot around our divided nation. “Political’s very strong. It’s gonna be very strong until they change the rules,” said Loughran. 

Despite reports of its demise, local television looks to stay hot, the panelists agreed. “Is local dead?” Wnuk asked. “It’s absolutely not.” 

NYC TV Week continues on Tuesday with the Next TV Summit and on Wednesday with the Hispanic TV Summit. ■

Firstlight Media said Tuesday that it will rebrand under the Quickplay name, about two years after the company purchased the cloud-agnostic OTT platform company from AT&T. 

Toronto-based Firstlight partnered with Highland Capital in March 2020 to purchase AT&T’s Quickplay for an undisclosed sum. Firstlight founder and CEO Andre Christensen had earlier  served as Quickplay’s chief operating officer and head of product development for AT&T.  

In a press release, the company said it expects to leverage its new moniker as it makes the rounds at the IBC 2022 show in Amsterdam next month, where it plans to preview new tools that can help accelerate OTT’s shift to platforms like:

“As we’ve extended our leadership in cloud-native streaming, it’s become clear to the market that the platform we’ve created is truly differentiated from anything that has come before it,” Quickplay co-founder and CEO Andre Christensen said in a press release. “Just as it did more than a decade ago, Quickplay today is making huge technology leaps that are enabling operators to capture leadership positions in an increasingly crowded streaming environment.”

Success in TV advertising has always been built on quality and premium experiences. The complexity of the rapidly digitizing marketplace might have drowned out certain quality-centric conversations in recent years, but it never changed that fundamental ground truth. Now those conversations are more important than ever. 

After years of divergence and fragmentation in the TV space — across streaming, over-the-top, connected TV, you name it — we’ve reached an important inflection point as it relates to the kinds of conversations happening on the media-buying front. While TV buys remain multifaceted and nuanced, many of the familiar dichotomies within the space — between linear and digital, between branding and addressability — are falling away. In their place, we’re seeing conversations converge around one factor: quality.

It's a welcome shift within the industry, one that’s long in coming and essential to the continued advancement of the TV space. Let’s take a deeper look at how we got here and why quality and premium experiences will lead us where we need to go now. 

 A Shift in Tone and Focus

When it comes to buying eyeballs, there are a lot of ways for advertisers to get tonnage these days, and on the cheap. But what’s become particularly apparent in the TV space is that not all impressions are created equal. As the TV and video landscape has fragmented, so has the value associated with reaching viewers across the many varied platforms, channels and devices on which they consume content. 

Simply put: People participating in a premium TV experience tend to be more engaged and vested in their programming than those who are giving fleeting attention to the latest cat video. Advertisers understand this, and they are increasingly looking to ensure their media spends prioritize the former over the latter. 

More specifically, what we’re seeing more these days is a number of savvy advertisers looking for extensions of their standard TV buys into streaming and OTT inventory — but not just any streaming or OTT inventory. They want to ensure their linear extensions are geared toward network inventory where the value and experience are just as premium as they’ve come to expect from their linear placements. They want exclusive, quality inventory, and they want white-glove service. But at the same time, they want to create a cross-platform experience and to wrap sophisticated conversion data and analytics around it. 

The conversations surrounding these cross-platform buys are a far cry from the volume-based transactions happening in the programmatic TV space today. And that’s because control of fragmented TV budgets is yet again shifting. 

Talking to Empowered TV Buyers 

When streaming and OTT advertising opportunities came into being, the media-buying landscape split. For years, linear and streaming advertising were handled by separate teams, the latter of which tended to fall in the camp of the digital buying teams. Now, a lot of that is changing. Traditional TV buyers are now increasingly bringing linear extensions under their purview, and they’re being empowered to extend their relentless insistence on quality inventory and premium experiences into new areas. 

This shift makes sense. After all, if content is appearing on that big screen in the living room, does it really matter which kind of pipes it is flowing through? Also, by bringing these buys together under the same buyer’s purview, we’re seeing a much more unified approach to measurement when it comes to campaign impact. 

Part of the reason TV inventory fragmented across buying teams in the first place was because of the vastly different measurement mechanisms that emerged in the early days of streaming and OTT. The new inventory was digital, with a digital language surrounding it, and so it made sense that responsibility for these buys slid toward the teams most familiar with the language. But here again, we’re seeing a shift.

As the TV industry pivots toward a more unifying language inclusive of impressions — versus less extensible concepts like gross ratings points (GRPs) — TV buyers are becoming sophisticated in their understanding of audience addressability and how best to target both their linear and streaming spending for maximum effect. They’re asking more nuanced questions than ever, and it’s paying off when it comes to a renewed emphasis on quality and premium experiences.

Today’s empowered TV buyers are leveraging their deep expertise from decades of linear buys and up-leveling their results through the transparency, measurability and added reach of streaming and OTT — and it’s really just the beginning. As the systems and partnerships that support the vast TV landscape continue to unify and connect more dots on the back end, advertisers will continue to extend the power of their creative and messaging across new audiences and platforms alike.

In this reimagined TV landscape, quality and premium experiences will reign supreme. Just as they always have. ▪️

Since Netflix reported weak first-quarter 2022 subscriber additions in April, there has been an onslaught of punditry about the demise of streaming which runs counter to many of our numbers and forecasts. We estimate 89 million U.S. paid streaming subscriptions were added in 2021 and forecast 80 million additions in 2022, and 50 million in 2024, all highly robust.

For the most part, streaming is a replacement for TV subscriptions, as well as for box office, packaged sales and rentals. With 6 million to 7 million U.S. TV subscriber losses per year — double the annual losses of a half-decade ago — TV is the gift that keeps giving for the streaming business. Between cord-cutters, cord-nevers and those who still subscribe to traditional TV, the penetration rate of households that pay for streaming is higher than it ever was for television.

At its apex in 2016, U.S. TV access and advertising was a $181 billion business, versus $158 billion in 2021. Based on our forecasts, it will tally $140 billion in 2024 and $105 billion in 2027. That’s not a pretty growth picture.

Meanwhile, U.S. streaming access revenue grew 37% to $39.4 billion in 2021, and we forecast revenue of $51 billion in 2022 and $69 billion in 2024. At its current run rate, streaming access revenue will be over $91 billion in 2027 and, when combined with TV programmers’ streaming advertising revenue, would be larger than the legacy TV business.

Assuming TV subscribers continue to decline at 6 million to 7 million per year, TV access providers will be effectively disintermediated by their programming suppliers. Hence within a decade, traditional TV will no longer exist and streaming will be the only show, game or movie in town.

Programming and now streaming behemoths The Walt Disney Co., NBCUniversal, Paramount Global and Warner Bros. Discovery are all seeing impressive streaming subscriber gains but at the cost of lackluster TV advertising and programming sales revenue growth. At the same time, they’re being constrained by Amazon, Apple, Google and Netflix, which together represent almost half of U.S. streaming access revenue.

Further, these major programmers will not reach, based on their own forecasts, streaming profitability until 2024-2025, as content spend has grown exponentially to keep up with Amazon, Apple and Netflix.

Programmers’ profitability predicament has been punished by Wall Street with stocks down on average over 40% year over year, not that Amazon or Netflix have fared any better. Further, Netflix was cash flow positive for the first time in 2020, but not in 2021, and we assume on a standalone basis Amazon and Apple’s streaming businesses are not profitable. 

Consumer Benefit, Provider Pain

Thus far, the only real beneficiary of streaming has been the consumer, who between paid and advertising-supported streaming can now assemble programming at lower cost than a TV subscription. Given the lack of stickiness of most streaming offers, consumers can also easily sign up and then churn off subscriptions. Streaming has also ushered in a massive rise and diversity of programming.

How much streamers raise prices, add advertising or limit free viewing going forward remains to be seen.

That streaming is only going to become more pervasive and end TV as we know it does not mean streaming is a great business for most.

All numbers in this article are from Convergence’s annual Couch Potato report series. 

Convergence Research Group estimated that over-the-top revenue in the U.S. rose 37% in 2021 to $39.4 billion and is expected to nearly double to $69 billion by 2024, as subscriber additions, about 80 million this year, should level off to 50 million by 2024. 

According to its just-released report -- The Battle for the American Couch Potato, which analyzed more than 75  OTT services (and over 50 providers) including Netflix, Disney Plus, Hulu, Amazon Prime Video and Warner Bros. Discovery -- Convergence said it expected U.S. OTT revenue to rise about 30% to $51 billion in 2022. 

At the same time, revenue and subscribers for traditional linear TV will continue their steady decline. Convergence said U.S. cable, satellite and telco TV access revenue fell 4% in 2021 to $91 billion, and should drop another 6% to $85.5 in billion in 2022, with further slippage in 2023 and 2024. Total U.S. TV subscribers dipped by 6.5 million in 2021, about the same as 2020, according to Convergence. That number should pick up to a loss of 7 million subscribers in 2022 and 7.2 million in 2024. 

The percentage of cord cutter/never households also should increase. Convergence estimated that  47% of U.S. households did not have a TV subscription with a cable, satellite or telco TV provider in 2021, rising to 53% in 2022 and 64% by 2024. 

Broadband customer growth is continuing to slow -- Convergence estimated that about 3.7 million high-speed internet subscribers were added in 2021, down  from 5.1 million in 2020, while revenue grew 10% to $79.6 billion. The researcher predicts that total broadband subscriber additions will tick up to 4.3 million (with a 7% revenue boost) as telco and fixed wireless additions improve, offsetting any sluggishness on the cable side.■

Over-the-top (OTT) video represents one of the fastest-growing advertising opportunities in the global marketplace right now. This growth is apropos, given the opportunities that OTT offers for enhanced targeting capabilities and contextually relevant ad placement, which in turn deliver a better viewer experience. However, OTT and connected TV (CTV) come with their fair share of challenges, as outlined in our recent report on global digital advertising trends, and there are multiple areas where today’s broadcasters are leaving money on the table. 

Let’s take a look at three key areas where broadcasters are missing out financially when it comes to their OTT inventory, as well as how they can pivot to ensure they’re achieving the greatest possible return on this growing opportunity. 

Sending Bid Requests Per Slot

As with other forms of digital advertising, OTT inventory purchasing is driven by bid requests, which are essentially lines of code that tell advertisers what they need to know to decide if they’d like to purchase a given piece of OTT inventory. When it comes to bid requests for OTT inventory, broadcasters can send individual bid requests per slot, or they can send per-pod bid requests. 

A pod, in OTT-speak, is simply a commercial break that contains multiple slots, and per-pod bidding lets marketers see the entire ad pod and the slots within it, versus just the individual slots. Right now, most of the industry is operating under a per-slot model. However, per-pod bidding is emerging as a growing opportunity, and it offers a number of benefits — including greater monetization on the broadcaster side. 

With per-pod bidding through certain platforms, broadcasters maintain unprecedented control over their OTT inventory, including the ability to determine individual floor prices for each slot and pod. With this more granular control, broadcasters can maximize the value of each slot. In fact, on our own platform, we’ve found that effective costs per thousand impressions (eCPMs) for podded inventory tend to be more than triple those of non-podded inventory.

Paying for a Third-Party SSAI Vendor

One of the biggest challenges with OTT and CTV is that, like other forms of digital advertising, it can be highly susceptible to ad fraud. That’s because of the extra layers of technology required to enable a dynamic ad buying process that can maximize the value of OTT’s targeting and attribution capabilities.  

In OTT, the fraud risk comes into play when broadcasters use a third-party SSAI (server-side ad insertion) service that sits between the broadcaster and the ad server. Here’s the thing: If broadcasters leverage a platform that handles SSAI in-house, they can not only eliminate the risk of fraud, but also the fees associated with a third-party vendor. 

By leveraging a platform with in-house SSAI, also known as dynamic ad insertion (DAI), broadcasters can also deliver a better experience to users, as in-house SSAI can deliver ads with less latency. Across the board, these benefits provide a better financial outcome for broadcasters — directly through cost savings and fraud reduction, and indirectly through better viewer experiences. 

Failing to Make Omnichannel Connections

Finally, let’s talk omnichannel. To date, a lot of the efforts in OTT and CTV advertising have been happening in a siloed fashion, as is often the case when it comes to building, enhancing and experimenting with new channels. But, as we see with every emerging opportunity, the greatest value can only be realized when individual channels are integrated into the larger advertising picture. In other words, advertisers want to know what role OTT and CTV are playing in their larger marketing strategies when it comes to boosting awareness and, importantly, sales—and they expect broadcasters to be enabling this type of cross-channel understanding.  

For broadcasters looking to maximize the value of their OTT inventory, an all-in-one platform enables them to monetize inventory across different channels and devices. By rolling OTT and CTV in as a part of a single omnichannel platform, broadcasters can get (and provide) better data and insights into how content and its associated advertising is performing wherever it’s consumed. This helps broadcasters make more-informed decisions and better optimize their pricing, offerings and advertising opportunities for marketers. 

OTT monetization for broadcasters is going to evolve and grow in the coming years, but that doesn’t mean broadcasters need to play the waiting game when it comes to ensuring they’re making the most of this emerging channel today. By addressing the above three common missed opportunities, broadcasters can ensure the money they were previously leaving on the table is ending up where it belongs — in their pockets. ■

Streaming content providers are telling the FCC it would be unwise and unworkable for Congress to expand the broadband subsidy base to include over-the-top video and others in the vague "Big Tech" basket and essentially impossible for the FCC to administer.

Currently, Universal Service Fund subsidies are levied on telecom services, not broadband, but with traditional phone service waning, that contribution base is withering as well, leading some to suggest that online behemoths be brought into the subsidy fold. Since those telecom subsidies are passed on to subs on monthly bills, levying them on streamers would almost certainly raise the OTT video price to consumers, though that was not the tack the Motion Picture Association was emphasizing in its comments on the FCC's inquiry into how to keep the USF fund sustainable.

In comments on the FCC's upcoming report on the future of USF, MPA counted the ways in which getting Congress to expand contributions to broadband content providers including streamers was a nonstarter, saying  that would "(1) exceed the Commission’s authority, (2) be inadvisable as a matter of policy, and (3) present significant implementation issues that would render such an approach unworkable."

Also: Network Affiliates Push FCC for OTT Must Carry

They told the FCC that the contribution problem can't be fixed by making streamers and other online services -- MPA suggests those would include online advertising, cloud services, online marketplaces -- subject to USF fees.

MPA represents Netflix Studios, LLC, Sony Pictures Entertainment Inc., Paramount Pictures Corporation, Universal City Studios LLC, Walt Disney Studios Motion Pictures, and Warner Bros. Entertainment Inc. OR put another way, a veritable Who's Who of streaming content players -- Netflix, Disney Plus, Hulu, ESPN Plus, Peacock, Paramount Plus, Crunchyroll, HBO Max.

They told the FCC that suggestions that streamers "disproportionately" get the benefits of broadband deployment while paying nothing to support broadband nets is false.

For one thing, they argued, they have been investing billions to develop programing that is highly valued by consumers and broadband buildouts allow those users to get even more value from their broadband service dollar. Then there are the investments in content delivery networks (CDNs) to help alleviate traffic issues and in versatile video encoding and variable bit rates to make data transfers more efficient.

They also say that from a policy perspective, targeting specific uses of broadband, say streaming rather than telehealth of IoT applications, does not make sense because it could hinder or favor a particular use.

Even if the FCC were to recommend that Congress expand the USF contribution base to include online services, it would create a host of intractable administrative problems, on which it elaborated:

"[O]nline services do not require Commission licenses to operate, there is no effective cap on the number of providers in the marketplace, and that number is always changing," MPA said. "Online platforms, including streaming services, social media networks, advertising platforms, and online marketplaces, are continually entering and exiting the market, creating a situation in which the Commission would be unable to properly determine which firms must pay contributions. USF
cannot be assessed on such a dynamic set of services in any way that is 'specific [and] predictable.' Moreover, the diversity of online business models and services makes 'equitable and nondiscriminatory' USF contributions impossible to structure, administer, or enforce."

As edge providers have moved more into Washington's regulatory sites, there have been various efforts to bring over-the-top video into the FCC's ambit, including pushes to define over-the-top video providers as MVPDs and subject them to program access and carriage requirements, as the FCC once proposed under then FCC chairman Tom Wheeler, and to put them under the FCC's must-carry regime as well.

ISPs have also argued that the Netflix's of the world were pushing for middle-mile net neutrality to avoid paying for the upgrades needed to handle the increased traffic load their OTT services generate. ■

Cincinnati Bell, doing business as Altafiber, has filed a retransmission consent complaint against Cox Media/Apollo's WHIO-TV, the CBS affiliate in Dayton, Ohio, and the top station in the market, for allegedly failing to negotiate in good faith, as FCC rules require, by trying to charge a fee for over-the-top video streamers as well as traditional cable subs.

Cincinnati Bell says that would constitute a "crippling" fee.

The telco, which is trying to launch a fiber to the premises (FTTP) video service combining cable and broadband, says its issue is that the station won't grant retrans rights unless it gets a per-sub fee from most non-cable as well as cable subs, even though the former are not getting retransmitted TV station signals. "Imposing retransmission consent fees on broadband subscribers, to whom no retransmission is made, would not only increase the cost of broadband service but it has the immediate impact of foreclosing competition," it says.

The telco says it has been trying to secure retrans rights since 2019.

According to Cincinnati Bell, "Cox confirmed that even if such a subscriber merely streamed YouTube videos or purchased a Netflix subscription, it demands payment of retransmission consent fees despite the absence of any retransmission by Altafiber."

The telco points out that WHIO has not asked for similar fees from other cable/broadband operators in the market, and while it concedes Cox could be testing the waters for doing so in the future, why it is doing so is not the point, but the effect of doing so, which is to hinder competition, is an exercise of market power that runs afoul of the good faith standard.

Cincinnati Bell says that without rights to the top station in the market, it will have to scale back or scrap construction of its planned FTTP system to 135,000 homes in the Dayton DMA. That means not offering choice in cable and high-speed broadband to a community with a median income of only $32,540, where 30% live in poverty and almost half the population are people of color, just the sort of community that needs choice. Charter is the cable/broadband provider the telco would be going up against in the market.

"Both Congress and the Commission have repeatedly asserted the need for ubiquitous availability of affordable ultra-high-speed broadband service," Cincinnati Bell says in its complaint. "This is exactly what Altafiber seeks to accomplish with its plan to invest hundreds of millions of dollars in Dayton, only to be derailed by an extortion demand."

Cincinnati Bell has asked the FCC order that Cox:

1. "Cannot require, directly or indirectly, payment of retransmission consent fees related to subscribers who do not purchase cable television service from Altafiber;

2. "Cannot mandate or restrict Altafiber’s fee or billing structure or disclosures for cable service so long as Altafiber does not disclose to subscribers the amount paid toCox for retransmission consent;

c. "Engage in good faith negotiations with Altafiber to attempt to resolve remaining open issues; and

d. "Cox is prohibited from engaging in any effort to circumvent the effect of the order, including, but not limited to, engaging in retaliatory pricing of its retransmission consent fees."

A Cox Media spokesperson had not returned a request for comment at press time.

Retrans complaints have generally been dismissed for failing to show the negotiations were not in good faith, or dropped after the parties involved reach an agreement and publicly bury the hatchet.

But last July, the FCC upheld a record $10 million fine against Sinclair-managed stations. ■

You got your double dippers. And then you've got your "service hoppers." 

You know who you are. You signed up for an OTT service. You canceled your subscription ... and then signed up again!

Churn for subscription OTT services, which ebbed a bit in the pandemic, is back, according to Parks Associates, reaching around 50% industrywide in the third quarter of last year. (Churn is the amount of subscribers cancelling the service in a given period represented as a percentage of the overall subscriber base.)

In fact, according to Parks, 36% of OTT households -- 32 million households in all -- are defined as "service hoppers." These are "OTT subscribers who switched between services and resubscribed to services multiple times in the previous 12 months," according to the research company. 

The challenge, Parks Associates says, is to identify these customers via data so that streaming companies don't chase these unprofitable customers "in vain." 

Promoting its latest OTT-themed report, Data-Based Decision Making for Video Services, Parks abstracted loosely related -- but nonetheless interesting -- er, data points. 

> 80% of U.S. broadband households subscribe to at least one OTT service. 

> 57% of U.S. households still subscribe to a traditional pay TV service. 

> Only 29% of U.S. households subscribe to an OTT service directly via the provider's website. This is down from 41% in just one year, Parks said. 

"Given the enhanced value of subscriber data, some content providers are seeking to re-establish control over their viewers — and the data about them — by not offering subscriptions via aggregators," Parks said. "In 2021, a substantial group of OTT households subscribed to an OTT service via Amazon Prime Video Channels, but that percentage could drop in the future, as HBO and HBO Max were removed from Amazon Prime Video Channels in September. Likewise, Disney Plus is not available through major aggregators, and NBC recently announced it is moving many of its shows exclusively to Peacock and away from Hulu." ■  

DMR said it reached an agreement with Microsoft’s Xbox to launch six of DMR’s over-the-top channels as VOD apps on Xbox One and Xbox Series X/S consoles.

The six channels are Cinehouse, Retrocrush, AsianCrush, Cororo, KMTV and Midnight Pulp.

The Xbox launch continues distribution momentum for DMR, whose channels recently have also been added on platforms including Peacock, LG Channels, Vizio SmartCast, Redbox, and The Roku Channel.

“DMR’s new agreement with Microsoft is an exciting new benchmark for our company. Our six channels are joining a very select group of entertainment apps on the service which includes Netflix, Disney Plus, Apple TV, YouTube and Hulu,” said DMR CEO David Chu. “This marks our first launch on one of the leading global gaming platforms and Xbox has been the most requested outlet for these channels by our loyal fan base”

Each of the DMR channels are available on Xbox for free with advertising, or as an ad-free premium channel for as low as a $4.99/month per channel subscription. 

The DMR channels have picked up distribution on other platforms. 

RetroCrush launched its free linear channel in the U.S. on Peacock, LG Channels, Vizio SmartCast and Redbox. Also a RetroCrush-branded programming block is launching on Pluto TV.

Midnight Pulp launched a free linear channel on Vizio Smartcast and a VOD app on Vizio Smart TVs.

Cocoro also launched a free linear channel on Vizio SmartCast and KMTV launched its VOD app on Vizio Smart TVs.

DMR also launched Retrocrush, Midnight Pulp and AsianCrush channels in Canada on The Roku Channel.

This year DMR launched a dedicated social video division that is approaching a reach of 20 million across YouTube and Facebook alone, and continued to distribute anime and other titles from its vast library to its streaming platform partners. ■

As executive VP of digital platforms at Charter Communications, Jodi Robinson is the go-to digital chieftain at the cable company, leading its video product management, customer self-service platforms, internal design agency and its data platforms organization. 

A graduate of Stanford University, Robinson joined Charter in 2014 as senior VP. She has led its digital platforms organization since 2019 and its user experience design and development organization since joining the company. Prior to Charter, Robinson was VP of Internet & Interactive Technology at Starz, where she played a big role in developing TV Everywhere apps and digital products for the programmer and was responsible for all online, digital and consumer-facing technology and video solutions. Before joining Starz, she held a number of roles of software development and architecture roles at Level 3 Communications and Sun Microsystems. In short, she knows her stuff.

Robinson took the time out recently to answer a few questions about Charter’s digital strategy and its Spectrum TV App from Multichannel News senior content producer – finance, Mike Farrell. Here’s an edited transcript. 

MCN: Obviously, consumers are accessing video and other services differently today than even just a few years ago. What is Charter doing to make that experience better?

Jodi Robinson: The video business is changing and we are innovating accordingly, reaching our customers wherever and whenever they want. We are largely able to accomplish this through the growth and expanded capabilities of the Spectrum TV App. It is robust and heavily used by our customers, making it the most-viewed streaming app in the country on an hours-per-household basis. It’s also currently the highest-rated pay TV streaming app in the US; we’re quite proud of the strides we’ve made to better serve our customers on this front.

While the app is growing and performing well, we also continue to enhance the traditional video experience. Spectrum Guide is now offered to virtually all new customers across our footprint. Within Spectrum Guide, and keeping with our theme of choice, we now offer Netflix, HBO Max and YouTube, and have plans to add more apps in the near future.

Another way we are enabling customer choice is through the Spectrum Access app, which we launched last year. It is a free app, available to all users in the U.S. that enables playback of audio description and closed captioning directly from a user’s personal device. This product is unique to Charter and exemplifies our commitment to creating products that work for all customers.

We also launched the Spectrum News App last year, which provides local news feeds from all the Spectrum News networks, original content produced specifically for the app, and curated content from partner news organizations.

MCN: What do you see as the most important aspect of your digital strategy? What’s the most difficult part of that?

JR: In order to succeed, we need to continuously adapt to meet the expectations of our customers, be as accessible as possible and stay ahead of trends in the industry. This means we must stay nimble and be prepared at all times to meet the needs of our customers. A big part of that strategy today is in the way we are delivering connectivity — as a converged and integrated service that includes mobile and broadband. Delivering ubiquitous connectivity allows our customers to work and learn on the go while also maintaining access to entertainment services like the Spectrum TV App. As customers expect more digital access, Spectrum will always be there to ensure consistent and reliable access is available — no matter the task.

MCN: You have the Spectrum app, Comcast has the Xfinity app, other distributors have their own app. What makes your app different? Or is it?

JR: High-quality streaming is our north star and our investment in performance is what sets us apart. The app works really well and that’s a testament to the way we operate the platform as well as the way we invest in innovation — continually raising the bar by bringing new features to the platform, while ensuring we do not risk the overall quality of performance.

MCN: Are more customers accessing service via the Spectrum app today than ever? Any estimates as to how many? How many do you think it will be in the next few years? 

JR: The Spectrum TV App is definitely more popular than ever. As of the end of Q3, we’re seeing more than 11 million active customer devices accessing the service every month and are pleased to report that the Spectrum TV App is the most-viewed streaming app in the country on an hours-per household basis. The adoption of the platform has been accelerating and we expect that trend to continue.

Also: Roku Yanks Charter Spectrum App in Carriage Dispute Switcheroo

MCN: It’s not just video that customers are accessing through the Spectrum app, but also customer service and account management. Is that the future? Are you gearing up for the day when most of your customer interaction is through apps? Is this making those operations more efficient?

JR: Yes, we are seeing operational efficiencies and satisfaction gains from customers who choose to engage digitally. Call centers and field technicians will always be central to how we serve our customers, but we are seeing a natural movement to digital engagement, including increased use of chat, the My Spectrum app and our website. All indications are this trend will continue to grow organically — and rapidly.

Charter’s approach is to serve our customers where they want, when they want, and how they want. Our customer service, field and network operations teams all work to provide options for our customers that make it easier for them to interact with us. Digital applications are a growing part of that strategy and investments in the My Spectrum app and Spectrum websites enable our customers to engage in new ways.

Our efforts in this space are part of a much bigger strategy to improve the customer experience. We have made network enhancements to reduce service disruptions, streamlined installation processes with most services now being self-installed, proactively communicated with customers through text and email to keep them aware of their services and account changes, and given customers the ability to track their techs in real-time for appointments.

We’re proud of the engagement and growth within our digital channels, but we are most proud of the way in which we have turned service into a personalized product for all customers.

MCN: Do you see a day soon when the Spectrum TV app replaces the need for a set-top at all? Is this going to take a few years as people switch out their home TV sets for smart TVs, or do you expect it to happen sooner?

JR: We continue to see a demand for the traditional video experience on a set-top box, especially as we add capabilities to the Spectrum TV experience like the introduction of streaming apps incorporated into that platform. We launched HBO Max and YouTube this year in addition to Netflix which has already been deployed to our traditional platform. That being said, traditional customers are relying more heavily on the Spectrum TV App within their house and while on the go using mobile devices. We like the fact that Spectrum customers get to choose which platform works best for their lifestyle.

MCN: The Spectrum TV app is available on Apple TV, Chromecast, Xbox One, Samsung Smart TVs and now Roku. What deals are left to do?

JR: Don’t forget mobile! The Spectrum TV App has a loyal following of Android and iOS mobile customers watching the game or catching up on their favorite series while on the go. We also support Chromecast and AirPlay streaming from mobile to connected-TV devices.

To answer the question, though, we’re always working to get the Spectrum TV App on the platforms our customers find the most value in. We have an open dialogue with most streaming device manufacturers and look forward to supporting additional devices in the near future.

MCN: Is this where you see the business going? If consumers don’t have a smart TV, they probably have an Apple TV device or something similar. Is the day coming when Roku Channels or Amazon Channels will be the primary sales vehicle for video, or do you see this as primarily a complement?

JR: It’s too early to make that type of prediction. As content continues to fragment into a variety of services, the role of the aggregator remains a moving target. I’d argue that the streaming services available today have made it more complicated for the average video subscriber to understand where to find the content they want. Users spend a lot of time browsing and searching — it might even be more accurate to say customers have to research where to find their shows and what it will cost them to watch. From monthly streaming subscriptions to free ad-supported content and now ad-free tiers, live and on-demand content with different access rules and the persistent confusion of ‘which app is the game on tonight’ questions, it’s a jungle out there. Our goal for the Spectrum TV experience, both within the traditional set top box and via the Spectrum TV App, is to enable seamless, aggregated access to high-quality video content.

I think we’ve done a good job reducing the noise for customers so they can maximize their time enjoying their video subscription.

Also: Women in Technology: Making Their Mark 

MCN: You did a Roku deal recently, after not being on that service for about 10 months. How important are outlets like Roku and Amazon to the overall mix?

JR: When it comes to our video products, we think enabling access through streaming devices is an important value-add to our growing customer segment. Enabling the Spectrum TV App on devices like Roku is something we will continue to do, so long as the technology requirements and platform agreement terms make sense for our business.

MCN: With every programmer having its own app, and many doing their own direct-to-consumer offerings, how close are we to the day where cable operators no longer offer traditional programming packages or authenticated streaming options, but just access to apps? Is that the next evolutionary step for the video space — broadcast begat cable which begat satellite which begat on demand which begat streaming, etc., etc. Is the ultimate goal to have cable apps like the Spectrum TV App be the vehicle where consumers can buy broadband service and packages of programming apps based on genres from the cable company, or even individually for a slight premium?

JR: It’s difficult to predict what is going to happen. One thing we all agree on is that there is more demand for high-quality video content than ever before. That demand is driving new consumption and behavior patterns for customers who want more control over their subscriptions, from the channels included in their packages to the way they sign up for service.

Charter is responding in the form of more flexible packaging including lower-priced video offerings like Choice, Stream and Essentials, all of which are available without a set-top box and through online digital purchase.

More broadly, though, I think we’ve got a long way to go before we’ve arrived at the ideal customer experience for purchasing and consuming streaming video. It seems clear that aggregation solutions and bundled pricing options will evolve, enabling more customer choice, forcing technology solutions that simplify the customer experience, and further increasing demand. ■

Media buyer Magna Global forecasts that total U.S long-form video ad revenue will rise 7% in 2022 after a 6% gain in 2021 to $65.6 billion.

For long-form video in 2022, Magna sees the biggest gains coming in AVOD, OTT and CTV revenue at 29%. Growth in 2021 was 26% in 2021 and accounted for a 2% share of the overall ad spending.

National broadcast and cable are expected to decline 5% in 2022 with local TV growing 13%, including political and Olympic spending. Without those cyclical events, local video revenue is seen declining 3%.

 Also: Magna Sees U.S. Long-Form Video Ad Revenue Rising 4% in 2022 

Short form video is seen rising 27% in 2022 after a 47% increase to $16.3 billion in 2021.

All U.S. media ad revenues are expected to be up 13%, with digital up 17%. That follows a 24% rebound to $284.3 billion in 2021, according to Magna.

 Also: U.S. TV Ad Spending To Rise By 4% in 2022, Zenith Forecasts

Global ad revenues are expected to grow 12% in 2022, with TV up 3.4% and digital up 16%. 

“The global ad market recovered above and beyond the economic recovery in 2021. Mature linear ad formats recovered to 90% of the pre-COVID level, just as the economy did. Digital ad formats, by contrast, grew much faster than expected, driven by multiple organic growth factors, e-commerce boom being the most significant,” said Vincent Létang, executive VP, global market research at Magna. 

“Traditional, brand- and privacy-safe media remain crucial to building consumer brands, as shown by the strong demand boosting TV costs in 2021, but marketers are increasingly diversifying into digital formats to reach hard-to-reach audiences, improve ROI  and connect more seamlessly to e-commerce. This once-in-a-lifetime planet alignment of growth factors led to the unprecedented market  growth we experienced in 2021,” Létang said. ■

The Federal Communications Commission is getting video streamers, multichannel video programming distributors (MVPDs) and others together to talk about the state of closed captioning for online programming.

It has scheduled a Dec. 2 forum with a keynote address from Sen. Ed Markey (D-Mass.), a longtime advocate for greater communications accessibility as author of the Twenty-First Century Communications and Video Accessibility Act of 2010 (CVAA).

The 1 p.m.-3:45 p.m. event is co-hosted by the FCC‘s Media Bureau and Consumer and Governmental Affairs Bureau. It will feature two panels of speakers, including streamers academics, consumers advocates and cable operators.

Also: Keeping Closed Captioning Ahead of the Curve

“Consumers currently access video programming from providers that range from traditional entities, such as broadcasters and multichannel video programming distributors (MVPDs), to a growing number of online streaming service providers, including those that operate social media platforms,” said the bureaus of the need for the event. ”The Video Programming Accessibility Forum – Online Closed Captioning will explore the state of closed captioning availability for online video programming and discuss ways to enhance accessibility, including the Commission’s authority to adopt new rules. The Forum also will explore current and prospective best practices and other existing or possible voluntary efforts that could enhance the availability of closed captioning online.”

Back in April, the FCC officially sought input on what changes it might need to make to video accessibility rules given that some of the requirements may have been "overtaken by new technologies."

Disability advocates have argued that one of the technologies the rules fail to capture is over-the-top video.

The FCC‘s rules implement the CVAA and apply closed captioning and audio description requirements to a boatload of communications technologies in addition to TV, including advanced communications services like interconnected and non-interconnected voice-over-internet protocol (VoIP), electronic messaging, interoperable video conferencing and browsing the net on smart phones.

Those advocates want the FCC to seriously consider how to apply captioning and audio description mandates to video streamers. ■

Acting FCC chair Jessica Rosenworcel said Thursday (Nov. 18) that her planned refresh of the record on independent content providers' access to distribution platforms will need to include over-the-top video.

Rosenworcel weighed in on the issue at her post monthly meeting press conference in response to a query from Next TV.

Rosenworcel had agreed to the lookback after she was queried during her nomination hearing in the Senate Commerce Committee this week by Sen. Amy Klobuchar (D-Minn.), who has heard from independents about the difficulties of negotiating carriage with distribution platforms.

Also: Rosenworcel Pledges to Re-Examine Video Programming

The FCC opened a Notice of Inquiry on the subject back in 2015 under then chair Tom Wheeler, but it was shuttered without taking any action despite reports that Wheeler was working on independent program access rules.

Asked what issues, if any, she had and whether the proliferation of OTT outlets for content somewhat mitigated her concerns, she did not go into specifics but did say she was committed to opening a new proceeding on the issue.

Also: Amazon to FCC: Many OTTs Don't Want Program-Access Rights

"The FCC had a proceeding on this some years ago and the docket was closed by my predecessor," she said.

Once it is re-opened, she signaled, OTT will get its fair share of the FCC's attention. "I think that moving ahead in this environment would require us to open a new proceeding and also ask questions that reflect the moment we're in," Rosenworcel said. "As you just described where watching is not just a function of linear programing but for many households it is also using new streaming services."

Some have argued that more streaming services means more places for independent programming to find shelf space. And while in 2015 OTT was not considered a platform on par with traditional distribution channels, that has clearly changed in the past decade. But others say that the 800 pound gorillas of traditional distribution have simply been mirrored online by the Netflixes, Amazon Primes and Paramount Plusses of the world. ■

Network-affiliated TV stations are again pushing the Federal Communications Commission to bring some over-the-top video providers under the retransmission consent regime so they will have to negotiate directly with TV stations for carriage.

That push came in comments to the FCC on the agency‘s latest quadrennial review of media ownership regulation.

They tried to get the FCC back in 2020, under former chairman Ajit Pai, to revive the proceeding, also citing the rise of OTT, but to no avail. The idea was originally proposed by then-FCC chairman Tom Wheeler, a Democrat, in 2014.

In asking the FCC to retain the rule against common ownership of two or more of the major national TV networks, the affiliate associations of the Big Four — ABC, CBS, NBC and Fox — said that it was necessary in part to keep the networks from exercising even more power over affiliation agreements.

Citing those networks launch of OTT direct-to-consumer platforms including Paramount Plus, NBCUniversal‘s Peacock and Disney Plus, the affiliates said the balance of power continues to shift to the networks.

“With every expansion of the networks’ reach within the video programming universe, and every platform geared toward direct distribution of their programming to viewers without a role for local affiliates, the power of the national networks grows, while affiliates‘ leverage vis-à-vis their network ‘partners’ diminishes in tandem,” they told the commission.

That power would grow even greater, they said, if networks were allowed to consolidate before negotiating affiliation agreements.

One way to try and tilt the balance back toward local stations, the affiliates suggested, would be for the FCC to follow through on its 2014 proceeding considering whether internet-based distribution should be classified as a multichannel video programming distributor (MVPD) for the purposes of retransmission consent negotiations between TV stations and national distributors.

They pointed out that in that proceeding, the FCC posited: “The ability of networks to achieve online distribution of network programming in a local market, without the need for local affiliates to consent, may give networks some additional leverage in the network affiliate relationship that did not exist in the pre-online video world.”

The affiliates said the FCC has proved prescient since OTT remains outside the retransmission consent regime and online video platforms are not required to negotiate directly with TV stations. Instead, the stations said, the Big Four have cut them out, negotiating with OTTs for their full network lineups and the associated affiliate signals, then presenting those deals to the stations on a “take it or leave it” basis.

“In cutting local stations out of the negotiations for the distribution of their news
and other programming, the networks dictate the value of both subscription (retransmission) and advertising revenues for local stations’ programming,” the affiliates said.

Already Miffed Over DTC

Affiliates have been unhappy for a while over direct-to-consumer OTT deals for network programming, particularly ones that dilute the audience for their local advertising.

They made that point again, in even starker and broader terms: “[T]he network-controlled process results in advertising funds being extracted from local markets and placed into network coffers, local retransmission consent revenues being materially diminished and shifted for the profit of the national networks and their vast cable portfolios, and, in the case of independent non-network affiliated local stations, virtually no distribution.”

They say that unless the FCC brings virtual MVPDs under the MVPD retransmission consent rules, it will perpetuate a market failure that adversely impacts local stations.

The idea behind Wheeler’s 2014 notice of proposed rulemaking (NPRM) was to give over-the top providers offering an online service that mimics a linear cable offering the same FCC-enforced access to vertically integrated programming. Wheeler was trying to promote new video competition to traditional cable, but eventually backed off the item after there was pushback, and an order was never voted on.

The 2014 item would define an OTT that delivers a linear stream of programming as an MVPD. That means those OVDs would have access to content through the FCC‘s program access rules, but also have to negotiate retransmission consent with broadcasters. It would not apply to IP-delivered versions of a cable operators traditional service, to which program access rules already apply.

Exactly which OTTs should be defined as MVPDs and what other obligations or rights might apply beyond that access — such as public, education and government (PEG) channel mandates or exclusivity — were all teed up in the many questions posed in the NPRM.

If the FCC votes to approve the NPRM, it would reverse a tentative, bureau-level conclusion in the program-access complaint involving Sky Angel, a Christian content-focused MVPD. That decision held that having a facilities-based transmission path was necessary to be an MVPD — something cable operators argued was necessary. The FCC tentatively concluded that an MVPD has to have control of both the content and the transmission path — copper, fiber or satellite signals — to be delivering a channel, and that an over-the-top distributor lacks that path since it is not using a facilities-based channel.

Not surprisingly, the networks disagree, and use the OTT platforms that their own online platforms compete against as their justification for preserving the rule.

In a joint filing, NBC, CBS and Fox (ABC did not joint the comments), said flatly that a basic review of the current marketplace leads to the "inevitable" conclusion that the dual network ban is not necessary now or in the future. "Netflix, Apple, HBO, YouTube, and Amazon are just a few of the ever growing list of providers producing and distributing content that competes alongside that of the four broadcast networks saddled with the Dual Network Rule," they told the FCC.

The networks also cited the siphoning of ads from their networks to digital platforms like Google and Facebook.

They also said that even absent the dual network rule, there would still have to be a fact-specific FCC (public interest) review of any proposed combination of broadcast networks.

Music licensing group ASCAP is going platform-agnostic in recognition of the rise of streaming video services and to make sure its musical members are benefitting from the powerhouse over-the-top programming that appears to be supplanting traditional video options as the go-to entertainment medium.

With its board's unanimous approval in a Sept. 22 vote, ASCAP is renaming and expanding its TV Premium Plan to tap into the success of programming offered by Netflix, Hulu, Amazon Prime Video, Apple TV Plus, Disney Plus, HBO Max and others.

The newly rechristened Audio-Visual Premium Plan, with expanded eligibility for premium payment, is meant to insure that the composers, songwriter and publishers it represents are eligible for bonus payments for the top streamed shows and movies on OTT services just as they already are for top cable and broadcast shows.

Citing the rise in cord-cutters and a growing cohort of cord-nevers who are migrating from traditional TV to streaming services for general entertainment content, ASCAP says it is well positioned to handle that evolution. That includes making sure its members can tap the growing revenue from OTT, which has seen compound annual growth of 30% over the past half-decade.

In a related announcement, ASCAP said it is adding top shows on Univision and UniMás to its premium payment program to reflect the rise in Spanish-language programming.

“As OTT services are rapidly scaling their businesses by providing subscribers with high-value offerings at price points that are disruptive to traditional TV economics," ASCAP CEO Elizabeth Matthews said. “ASCAP is expanding its premium plan structure to ensure that our composers have the ability to earn a viable living from top-streamed shows. This protects the economic value of their music in AV OTT programming by creating incentives to retain their future backend public performance royalties in their own deal making with production companies and streaming services.”

ASCAP handles performance royalties for more than 825,000 members and licenses for more than 16 million copyrighted works.

Hearst Television has launched Hearst Audience Marketplace, which provides marketers with data to target advertising on connected TV, over-the-top and programmatic display and video platforms.

The Audience Marketplace is the newest addition to Hearst Anyscreen, the targeted advertising platform the company launched in 2018. Hearst projects that its Anyscreen revenue will grow more than 40% in 2021.

"Our clients increasingly look to us for a range of solutions that can include the unparalleled mass-audience reach of broadcast television and the latest in audience-targeting technology,” said Jordan Wertlieb, Hearst Television president. “With Hearst Audience Marketplace we’re able to deliver on their needs with consistently brand-safe premium inventory.”

Using the Audience marketplace, advertisers can target viewers based on classic audiences, built using demographic, behavioral and lifestyle characteristics; or Hearst Audience Personas, a collection of profiles based on consumer interests, perchance history and online and offline behavior; or custom-created audiences.

Also Read: Gerry McGavick Promoted to Director of Sales at Hearst TV

Hearst Anyscreen combines preferred access to Hearst-owned programming, including the Very Local, Hearst’s new over-the-top offering, with an array of leading delivery and analytics partners and direct-to-publisher alliances.

“Marketers want data-driven solutions that support their efforts to reach current and prospective customers,” added Jonathan Sumber, Hearst Television VP of digital sales. “This requires expertise around what is effective, what is privacy-compliant, and what enables it all to work at any scale. Hearst Audience Marketplace is designed to enable any business, from the smallest local shop to the largest multinational, to benefit easily from sophisticated targeting tools without having to become data experts.”

The world of streaming is fragmented and complicated. It’s hard to keep track of all the providers and ways of accessing OTT.  It turns out it is also hard for consumers to keep track of their streaming subscription costs. We found that most consumers are underestimating their monthly expenditure on subscription services by 35%.

We asked 1,000 consumers to estimate the amount they spent on streaming services each month, then calculated their actual costs based on the services they then reported paying for. The average estimated spend was about $49, while the average calculated expenditure each month was $66. 

Everyone’s Undercounting

For both estimated and calculated payments, the average spend was about $15 higher than the median spend. This indicates that some people pay a lot for streaming services, pushing up the average. Slicing into the data, we can see that two groups in particular pushed up the averages — those with high wealth and parents. Both groups tended to far underestimate their spend, with high-wealth groups spending an estimated $60 monthly and parents $56. For both groups, calculated spends were over $85 per month.

While parents and wealthier consumers are paying a lot more than they think, on average, all groups of consumers are miscalculating their monthly expenditure on streaming services.  There is one exception, though — seniors are the one group spending less than they think they are, with a monthly bill $14 less than their estimated spend of $48. Why would seniors think their streaming content costs more than it does? They also tend to have a cable subscription.  The premium price of a cable bundle and use of smart TV remotes may cause seniors to lump all services into one number in their heads. 

Across all consumers, clear patterns emerge for SVOD penetration and subscriptions. Which services are adding up to that average of $66 per month? Netflix is the clear dominant SVOD; three out of four people had watched it in the last 30 days. Amazon Prime was the second most popular SVOD and growing the fastest in penetration over the past year. From a total viewer perspective, Hulu rounded out third place in reach. However, the vast majority of Hulu’s viewers were reachable by ads, either in the Live TV service or VOD with ads. In fact, only 10% of Hulu’s viewers were not reachable by ads, confirming the scale advantage many advertisers are seeing on Hulu. 

Apple TV Plus had the smallest reach of any subscription-only streaming service, with just 11% of our respondents paying for it. Like many Apple products, we also saw a coastal geographic skew of Apple TV Plus, especially New England and California. HBO Max followed this same geographic pattern, but had almost three times as much reach as Apple TV Plus. 

Parents are strong SVOD users, but are more or less willing to watch ads depending on how old their children are. Households with kids under 8 were the most likely to watch SVODs. Households with older children were slightly more likely to watch ad-supported content types. 

Parents Avoid Ads

Like avoiding a street when the ice cream man arrives, we know parents might be sensitive to exposing small children to ads. However, teenagers may be a factor in adoption of newer free media sources, driving penetration numbers up in those households. 

For some groups of viewers, we can see there is low price sensitivity to streaming subscriptions.  For parents, the value of ad-free content seems established, and we can expect services to move from new additions to necessities. Seniors may be anchored by the premium price sticker on cable and be less sensitive to bundled services. As marketers, we know consumers will always pay for choice if they can afford it, as we’ve seen with higher wealth households seeing the value in access to all streaming content.

For other groups of viewers, we can expect that the piling on of services will add up to some serious price shock and increased interest in cheaper ad-supported alternatives. Younger, single-person and lower income households will take the time to hunt for deals and alternatives. 

The price anchor is untethered for both price-sensitive and more tolerant streaming viewers. As the industry figures out consumers’ tolerance for subscription fees, it’s important to consider that most consumers haven’t yet decided on their price tolerance, either. 

A coalition of diversity groups has asked Congress to pass HR 5056, the MVPD Tax Credit Program, which would give a tax credit to MVPDs and their over-the-top streaming counterparts for carrying diverse, including minority targeted, independent programming.

The bill was introduced by Rep. Yvette Clarke (D-N.Y.).

In a letter to House leadership, the groups, which included the Multicultural Media, Telecom & Internet Council and the National Urban League, "implored" them to pass the bill, which they said would help level the playing field for indies in the pay TV business, including on OTT platforms, such as You Tube TV, Hulu, and Sling.

Also Read: Starks: Broadcast Ownership Report Still Shows Diversity Deficit

Specifically, Clarke's bill provides that:

"For each qualifying carriage agreement with eligible independent programmers, an MVPD will be eligible for a tax credit equal to 1) the lesser of the net license fees paid or incurred by the MVPD or 2) the product of $0.10 multiplied by the number of subscribers per month receiving the independent programming provided under such agreement. 

"Programming credits will not exceed the product of $0.10 multiplied by 3 times the average number of an eligible distributor’s subscribers in a given taxable year. Tax credits received under this Act cannot also be claimed as a tax deduction."

ABC has released the trailer for the eighth installment of its One America streamed news series.

That comes just in time to kick off Hispanic Heritage Month (which is actually Hispanic Heritage 30 days, starting Sept. 15 and ending Oct. 15).

Our America: Todos Unidos, a weeklong special, streams Sept. 15 on the web sites of ABC's eight owned TV stations and will also be available on ABC's almost three dozen connected TV apps on Fire TV, Android TV, Apple TV, Roku, and Hulu.

"From actors and activists to business owners who are keeping traditions alive, the hourlong news special shines a light on diverse voices from the Hispanic community honoring their heritage, celebrating their culture and expressing their identity," ABC said.

The series was helmed by the ABC-owned stations' Race and Culture Content EPs Mariel Myers, Porsha Grant and Nzinga Blake.

Sinclair Broadcast Group is looking to expand its free, ad-supported website and app that lets viewers check in with local TV newscasts from 275 stations across the country, to see how wildfires are being tackled in Oregon, if rains have let up in Western Massachusetts or how new voting-access laws are being covered in Texas. 

NewsON has been around since 2015, originally owned by several station groups that contributed broadcast feeds to the service but, since 2017, wholly owned by Sinclair Broadcast Group, which had joined the consortium in 2016. 

Sinclair this month took note of several upgrades to the service, including a new (since February) web-based version of the service on NewsON.us and better search and display functions on the over-the-top channel, which is available on Roku devices, Amazon Fire TV, Apple TV, and iOS and Android mobile devices. 

Also Read: Ripley Says Bally Sports Net DTC Offering Will Be 'Lean-Forward' Experience

Sinclair officials said the service has been growing in terms of viewing and revenue. Without giving out specific numbers, Sinclair said for the first six months of this year, NewsON’s viewing minutes are running over 30% ahead of where they were in the six months pre-COVID (March 2020), average sessions per user (per month) are up over 10% in that span and revenue run rates are up over 50%. Sinclair offers advertisers options to geo-locate their spots or have them retransmitted as they air on the stations.

Some other figures: NewsON has news content from more than 275 stations owned by 15 station groups, with the biggest absence from the affiliates being Nexstar, which was in the consortium but left after Sinclair took it over. (ABC owned and operated stations also left, in 2020.) Live and on-demand local newscasts on NewsON come from more than 165 local markets covering more than 75% of the U.S. population, according to Sinclair.

Upgrades to the viewer experience put in place since this spring reported by Sinclair include:

--Improved discovery of breaking news, so that when a local story gaining national attention occurs, a dynamic breaking news banner at the top of the screen alerts viewers to stations with coverage of the event.

--Additional market imagery, with each market represented in the app now identified with a featured image for the designated market area. 

--Simplified access to stations marked as favorites (see screenshot), allowing viewers to easily access news outside of their own market. 

Scott Ehrlich, senior VP of growth networks and content at Sinclair, said “the idea of having the broadcast news industry working together to deliver to consumers a national offering of local broadcast news is something we’ve always thought was important. And as OTT has developed over the last few years and as it’s gotten more important to have a local presence as part of an OTT strategy, NewsON has really kind of come into its own.”

Also read: Local TV Connects Amid Crises (Cover Story)

News viewing clearly grew in the last couple of years with interest in the presidential election, with protests over the George Floyd murder and with the COVID pandemic. “It put particular focus on local broadcast news, because local broadcast news was the feet on the street telling those stories, the stories in Seattle, the stories in Portland, the stories across the country,” Ehrlich said. “And as a result the business has continued to grow and we’re investing more and we’re expanding in all those kinds of things” that were outlined in Sinclair’s news release about the NewsON upgrades. 

Like other OTT services, NewsON wants to keep adding platforms to keep growing and building on its gains, Ehrlich said, with talks ongoing with platform providers and with other station groups. 

Sinclair Broadcast Group chief Chris Ripley denied reports that its planned direct-to-consumer RSN service would be priced at $23 per month, but declined to reveal how much the company will charge for the service, according to an interview the CEO had with the Baltimore Business Journal.

Baltimore Business Journal reporter Holden Wilen corralled Ripley briefly during a celebration for Sinclair’s entry into the Fortune 500 on June 21. Wilen asked Ripley about the $23 price point.

"That number is inaccurate and I can’t comment on what the ultimate pricing will be," Ripley said, according to the publication.

That denial also comes on the heels of Sinclair’s 8-K filing with the Securities and Exchange Commission that offered more details -- but no pricing information -- on the proposed DTC service.  

According to the Business Journal report, Ripley said Sinclair is conducting market research to determine a “fair price” for the DTC service, but his reluctance to offer any guidance as to the ultimate price of the service could speak volumes. Is he saying the reported price is too low or too high? 

Ripley and Sinclair have been keeping any information concerning the pricing of the service close to the vest. At the JP Morgan Telecom, Media & Communications conference in late May, Ripley would only say that there would be a “substantial difference” between pricing for the DTC service and  what the RSNs charge traditional distributors. 

According to Kagan, a unit of S&P Global Market Intelligence, the average RSN charges about $3.53 per subscriber per month. The Sinclair RSNs -- which are branded as Bally Sports Networks -- charge distributors between $7.52 and $2.42 per subscriber per month, Kagan said.

Earlier this month the New York Post reported that Sinclair was trying to raise $250 million for the DTC service, which would be launched in 2022 at a price of about $23 per month.  

Media outlets quickly spread the news, with some in markets like Minneapolis and Fort Worth, Texas, where Sinclair has an RSN presence, expressing varied opinions about the cost.

Also Read: Why Sinclair’s $250 Million Sports Streaming Swing Could Deliver a Walk-Off Defeat of Pay TV 

In a March podcast with the Minneapolis Star-Tribune, The Streamable co-founder Jason Gurwin estimated that Sinclair would have to charge as much as $40 per month for the standalone service, less if there is a heavy sports betting component. 

“So if they need to charge the consumer $40 a month in order to break even on rights fees, I could imagine a world where they're like 'Hey, if you are gambling $100 a month through our service, we'll give you the RSNs for free.' But obviously online sports betting is not legal yet in Minnesota," Gurwin said in the podcast.

Sinclair filed documents with the Securities and Exchange Commission on Tuesday that showed in part its plans for the DTC service. While it did not include pricing, it did say that the company expected to have about 4.4 million subscribers to the service within 5 years  that would generate about $1.025 billion in revenue. At that rate, ARPU for the service works out to be about $26 per month, but that could also include advertising revenue. 

Other sports pundits have estimated that Sinclair would have to charge between $25 and $30 per month for the standalone streaming service. And they have said that the company’s goal of attracting 4.4 million customers for the DTC service was surprisingly low.

Also Read: Ripley Says Bally Sports Net DTC Offering Will Be a Lean-Forward Experience 

Sinclair has estimated previously that the standalone service would tap into as many as 30 million homes within the networks’ service territory that don’t subscribe to a pay TV service. Add that to the 52 million subscribers to its traditional pay TV offering, and the potential universe for the DTC service looks large. 

Sinclair bought the RSNs in 2019 for about $9.6 billion from The Walt Disney Co., placing the networks in a separate subsidiary called Diamond Sports Group. Diamond has been trying to restructure about $8 billion in debt associated with the purchase for months.  

Sports consultant Lee Berke, president and CEO of LHB Sports, Entertainment & Media, said RSNs across the country are grappling with ways to make up for the rapidly declining linear pay TV customer base, which is shrinking at a 6% to 7% annual clip as consumers increasingly cut the cord. Sinclair is faced with the added obstacle of restructuring its debt, meaning it has yet another party to sign off on its plans -- its bondholders. 

“You need viewers, you need distributors and you need the bondholders to all enthusiastically support this,” Berke said. “So far it seems like there is limited support from all three.”

According to the SEC filing, Sinclair has proposed restructuring Diamond Sports Group’s $8 billion in debt by asking for an additional $1.1 billion in cash from bondholders in exchange for higher interest rates, but that it had not been able to reach an agreement. News of that failure sent the DSG bonds below 66 cents on the dollar for the first time since November, according to The Wall Street Journal. 

The bondholder proposal seems similar to one floated back in April that was outlined in greater detail by Wells Fargo media analyst Steven Cahall. 

“This is not just a Sinclair problem, it’s an NBC problem, it’s an AT&T problem, it’s everybody in the RSN marketplace,” Berke said. “But it sure seems like you’re going to have to come up with something that is more aggressive to get a buy-in from all three parties. The sort of buy-in you need to move things forward.”

Ripley said on Sinclair’s Q1 earnings conference call in May that it has “cleared the path” with distributors regarding the DTC offering, but a Sports Business Journal report claims that at least two major distributors say they have not held “meaningful contact” with the broadcaster and are “in the dark” concerning the direct-to-consumer plans for the RSNs. 

Those same distributors said they would consider dropping Sinclair’s RSNs from their pay TV lineups if they launched a standalone DTC version of the networks, encouraged by Dish Network, which dropped the linear RSNs in 2019. 

In the SEC filing, Sinclair estimated that the linear RSNs would generate about between $3.07 billion and $3.249 billion in revenue in 2021, but that appeared to include Dish subscribers. Dish is set to renew its retransmission-consent agreement with DSG parent Sinclair's broadcast TV stations in August, at which time the RSN agreement could also be renewed.

Sinclair Broadcast Group CEO Chris Ripley said that the gamification aspect of its planned over-the-top regional sports networks offering slated for next year will provide users with more of a lean-in, video game-like experience rather than just another vehicle to watch live games. 

Sinclair has said its Bally Sports Networks RSNs will launch a direct-to-consumer version in 2022 (Bally Sports Plus) for all 19 of its channels. While Ripley did not address reports that the company was trying to raise $250 million for the launch -- and that the DTC version would be priced at about $23 per month -- he did offer some slightly new insights to the product.

At S&P Global Market Intelligence’s virtual Kagan Media Summit Thursday, Ripley said that the DTC service will be more than just delivering games to subscribers. 

“This is really about giving people a whole metaverse around sports, for them to interact with fans that have self-selected teams they like, and giving them opportunities to engage in different types of content, like short form editorial to highlights and then gamification,” Ripley said in a pre-recorded conversation with Kagan senior research analyst Justin Nielson. “When you think about bringing a sport fan who would have historically watched on linear channels, bringing them into a digital environment where you know their name, you know their payment information, you know their preferences, it opens up a whole plethora of opportunities in which you can increase engagement and you can increase revenue opportunities.”

While there has been some speculation that the DTC version of Bally Sports could offer out-of-market games to subscribers, Ripley said that is not the case, at least for now. 

“The core rights that this enterprise will start with, those are limited to the regions the RSNs operate in,” Ripley said, adding that there is still a significant opportunity there. Sinclair has said within its existing footprint of 70 million homes there are about 35 million homes that don’t get live sports. 

“That means that over half of households are not getting their local sports product,” Ripley said. “We think that within that opportunity set there is a significant amount of fans who will  now be able to engage with us.” 

Gamification has been cited as potentially one of the more lucrative aspects of a DTC sports channel -- some research estimates it could be worth as much as $10 billion to $20 billion annually over the next several years. But Ripley said the goal on that end is to give users, particularly younger users, a more interactive experience. He added that Sinclair is working on a new experience with Bally that would allow viewers to watch and play at the same time.

“Currently it’s a passive experience,” Ripley said of watching sports. “In all of our research the younger generation is looking for that video game-like experience, a lean-forward experience, where they are able to interact, to play a game within the game. That’s the goal of the [Bally’s] partnership, to be that cornerstone at least as it relates to the for-money version of gamification, to build out a new sports viewing experience.”

The idea of a standalone streaming sports service on the surface seems like a no-brainer. If sports is often the most-watched programming on linear TV, why wouldn’t a DTC service be equally popular with consumers? But there are a mountain of factors that could affect a streaming RSN product, starting with pricing. While reports have said that Sinclair is targeting a $23 monthly price point for the service, others have said it will probably be closer to $30 per month. But even at the lower price, it’s still a difficult sell.  

Adding to the pressure is that while RSNs currently receive fees from pay TV distributors for all of their subscribers, regardless of whether they watch or want the programming, that won’t be the case with a DTC service. The prevailing wisdom is that about 30% of traditional pay TV subscribers watch sports, but it can be lower. Earlier this week, Altice USA chief financial officer Michael Grau said at the Credit Suisse virtual Communications Conference that about 15% of its nearly 3 million video customers "are reasonably or heavily engaged in watching regional sports networks.”  

Also Read: NBCU Eyes Peacock for RSN Future 

Sinclair is one of the largest TV station owners in the country with about 186 properties in 87 markets; and is the largest individual owner of RSNs, with 19 properties and minority interests in two more --YES Network and Marquee Sports Network. At the Kagan conference, Ripley said that he expects consolidation to continue in both industries and that Sinclair will be a participant.

“We’re always interested in figuring out a way to consolidate the marketplace, both on the TV side and the RSN side,” Ripley said. “The TV side is entirely too small in the world of big tech and big media and it’s really outdated regulations that keep it that way. Consolidating the industry is a commercial inevitability both on the broadcast side and then on the RSN side, it’s also a commercial inevitability there that consolidation will be effected. Being about half the industry there, we will play a major role in that.” 

The E.W. Scripps Co. said it has launched the Florida 24 Network, a new statewide news service available over-the-top in every market in the state.

The station will feature reporting from Scripps TV stations in the market. Scripps has stations in Miami, Tampa, West Palm Beach, Tallahassee and Fort Myers.

“Scripps is committed to serving both long-time Florida residents and newcomers with the authentic and hyperlocal journalism we know is essential to people’s lives,” said Scripps Local Media president Brian Lawlor. “The launch of the Florida 24 Network is the evolution of our long-time commitment to our Florida audiences and advertisers. We know our local business partners are eager to reach TV consumers via OTT.”

The Florida 24 Network will be available everywhere in the state in linear form and on-demand via its OTT app on streaming platforms, including Roku, Amazon Fire TV, Apple TV and Android TV and via all Scripps Florida stations’ streaming apps. 

Also Read: Local Now Gets Additional News Programming from Scripps Stations

The network will be led by news director Nicole Wolfe, based at Scripps’ WSFL-TV in Miami, and senior director of digital Matt Borek, based at Scripps’ WFTS-TV, Tampa. 

It will cover politics, tourism, wildlife, beaches, lifestyle and agriculture. Meteorologists from each market will have frequent weather reports, with a focus on storms during hurricane season.

The network will also feature regular updates from Katie LaGrone, Scripps’ statewide investigative reporter and Forrest Saunders, Florida State Capitol reporter in Tallahassee. 

Also Read: E.W. Scripps Plans to Take Over the Air Nets Over the Top

“The pandemic has taught us a lot about the ways in which our newsrooms are able to collaborate to produce high-quality news and information in a remote environment,” said Lawlor. “The Florida 24 Network captures those learnings with the same commitment to essential journalism for which Florida residents have known Scripps for many years.”

The National Association of Broadcasters and the network affiliate broadcaster associations are giving the FCC a lot to think about when it comes to whether to extend emergency alert requirements to over-the-top video services.

In comments filed last month, NAB said for a number of reasons streamers weren't equipped to deliver the alerts. Network affiliates suggested in their own comments this week that, if that were the case, there was a ready solution. All those streamers need to do is carry local TV station signals on their streaming services, which they are pushing the FCC to mandate.

"[T]he Four Affiliates Associations urge the Commission to note in its forthcoming report to Congress that Internet-based streaming services can and should be required to carry local broadcast signals in every market, to ensure that EAS information and other emergency warnings reach all viewers in every market across the country," the affiliates said. 

And, taking a page from the satellite-TV carriage requirement, they argue if the streamers carry one such stream, they can and should carry them all.

In reply comments on the FCC's inquiry for a report back to Congress into whether streamers should be delivering alerts, given the rise in popularity of streaming services like those co-owned with ABC (Disney Plus), CBS (Paramount Plus) and NBC (Peacock), the affiliate associations representing ABC, CBS, NBC and Fox said that sounded about right to them.

As the networks move their programming to online platforms, affiliated stations are concerned about being cut out of the equation or their network programming losing ad dollars and viewers to the online versions.

Also Read: Disney Finishes Upfront with 40% of Ad Dollars Going to Streaming

In reply comments this week on the FCC's inquiry about whether or not streamers should be delivering alerts, given the rise in popularity of streaming services like those co-owned with ABC (Disney Plus), CBS (Paramount Plus) and NBC (Peacock), the affiliate associations representing ABC, CBS, NBC and Fox said it sounded about right to them that streaming services should provide alerts by carrying local stations.

"The Four Affiliates Associations recognize that, in order to best fulfill the public informational and safety purposes underlying the EAS, alerts must be made available not only to those viewers watching the over-the-air streams of television broadcasters in their local communities (or via local broadcasters’ streams on traditional multichannel video programming distributors), but also those who primarily or exclusively rely on streaming or other Internet-based distribution services to access video programming," the affiliates told the FCC Monday (June 14). "Unless and until EAS obligations are extended to Internet-based programming distribution platforms, those platforms’ viewer/subscribers are at risk of missing the essential emergency information made available by local television broadcasters," the affiliates said. 

As a result, they urged the FCC to tell Congress that streaming services should be required to deliver alerts. 

They point out that "some commenters," including streaming services, have objected to the EAS obligation, saying it can't be done or that it is "duplicative, unnecessary, and [would] likely lead to viewer exhaustion.”

But while the stations cite AT&T and the Motion Picture Association (whose members include the studios behind Disney Plus, Hulu, ESPN Plus, Peacock, Paramount Plus and HBO Max) for making arguments against the streaming mandate, those "others" also included NAB, which argued that the technological challenges make it "extremely burdensome, and likely infeasible, to update the EAS system to enable alerts to consumers provided through the internet, including through streaming devices." (Later, NCTA also said it thought streamers should not be required to carry EAS messages, because existing media do the job adequately.)

NAB said its position was that the FCC should not require streamers to provide their own alerts, but a spokesperson told NextTV the association had taken no position about reaching streaming audiences by requiring those services to carry local TV signals. NAB's position was based on the feasibility, or lack of it, of streaming services doing their own alerts and stopped short of taking the affiliates' next step of mandating the broadcast solution, the spokesperson said.

The affiliates said that streaming services' arguments against compliance "defy common sense and ignore the importance of ensuring that all television viewers are alerted in times of emergency."

As to infeasibility, "streaming services are not ill-equipped to distribute EAS information, and no wholesale reconfiguration of Internet-based programming distribution technology would be needed to guarantee that appropriately targeted EAS information reaches viewers via streaming platforms," the network-affiliated stations told the FCC.

They said that streaming services can carry the live feeds of broadcasters in the communities the streamers serve. "This has previously been accomplished within the contexts of cable and satellite. It can work just fine with streaming services as well."  

They point out that some streaming platforms have been able -- even eager -- to negotiate broadcast station carriage, suggesting that the refusal by others to include live, local programming "is a choice, not an insurmountable obstacle — technological or otherwise."

Also Read: Streamers Say They Shouldn't Have to Relay Emergency Alerts

The companies behind the top streaming services agreed with the FCC that delivering potentially life-saving emergency alert information to the public is of "paramount importance," but they argued their OTT services should not be required to participate in that system, saying it would not appreciably increase the number of people who get such alerts but would appreciably increase the burden on streamers if they were required to deliver them.

This is not the way all these pointy headed OTT studies we’ve published ad nauseam over the last decade-plus are supposed to work!

A new Leichtman Research Group (LRG) study said the percentage of U.S. TV households connecting their TV to the internet to watch video has gone down this year, narrowly at least, to 39% from 40% in the pandemic 2020. 

“Use of connected TV devices leveled off over the past year after being pulled forward due to the coronavirus pandemic last year,” said Bruce Leichtman, principal analyst for LRG.

Indeed, 2020’s level was a significant bump from the 31% of homes in 2019 found by LRG to watch video via a connected TV gadget, the 19% reported in 2016 and the 3% reported in 2011.

Other data in LRG’s Connected TVs 2021 report seem to maintain the status quo in terms of the industry's upward trajectory.

The report said that 82% of U.S. TV homes have at least one internet-connected TV device, such as a Roku box or streaming-enabled gaming console, vs. 80% in 2020, 74% in 2019, 65% in 2016 and 30% in 2011.

LRG also said that 60% of adults watch video via a connected TV device at least weekly, compared to 59% in 2020, 52% in 2019, 40% in 2016, and 10% in 2011.

Gray Television is pushing the FCC to classify over-the-top video providers as MVPDs so they will have to negotiate carriage with stations.

That is according to a presentation to FCC commissioner Nathan Simington and his media advisor, Adam Cassady, by Gray counsel and former FCC commissioner Robert McDowell.

Gray is tying that and request for other regulatory changes to the value of local journalism.

In a presentation to Simington and Cassady, according to an FCC document, McDowell said that because of "quirks" in copyright law and FCC regs, OTT services like Hulu and YouTube TV don't have to negotiate retransmission consent with individual stations.

Also Read: Affiliates Ask FCC to Revive OTT-Regulating Item

Instead, he said, ABC, CBS, Fox and NBC negotiate the agreements then offer them to stations at what he calls rates often "far lower than the stations receive for traditional MVPD retransmission consent."

That, said McDowell and Gray, is a "regulatory distortion" that "artificially reduces
station resources that otherwise would be directed to local news production."

McDowell pointed out that the FCC has a proceeding pending since 2014--when then chairman Tom Wheeler teed it up as a way to promote OTT competition to traditional video--to "correct" the problem by classifying linear
OTTs as MVPDs when it comes to retransmission consent.

Linear OTTs provide day and date lineups of content channels similar to cable and satellite operators. Wheeler wanted to make sure those OTTs got nondiscriminatory access to programming affiliated with competing cable and satellite distributors.

Last year, and under previous FCC chairman Ajit Pai, the network affiliate associations collectively asked the FCC to reopen the issue, pointing out that OTTs were beyond the reach of retrans and program access rules.

While it had Simington's ear, Gray also called for excluding local news from the FCC rule that if a station providers more than 15% of programming to another, the FCC treats the two as co-owned and thus subject to limits on duopolies. "Excluding local news from this limitation would incentivize stronger stations to supply local news programming to weaker stations and increase the amount of local news content aired in the market," McDowell told them. 

The threat of further direct-to-consumer content consolidation shouldn’t worry traditional pay TV distributors, Altice USA CEO Dexter Goei said at an industry conference Tuesday, because it will help MVPDs weed out what has been an albatross around the industry’s collective neck for years -- unprofitable video customers.  

Analysts expect that other content companies could follow Discovery and WarnerMedia’s attempt to create a streaming video behemoth, but Goei, speaking at the JP Morgan Technology, Media & Communications conference, said that could be an economic boon for traditional distributors. 

With pay TV subscriber rolls steadily eroding over the years, it is evident that consumers are already moving toward an over-the-top, direct-to-consumer model. As content providers look to get larger and gain more streaming scale, Goei said it could allow traditional MVPDs to focus more on highly profitable broadband service, and weed out low-margin video subscribers.

Also Read: Discovery/WarnerMedia Combo Could Have Biggest Initial Impact on Linear Nets 

“Larger players with a full package of offerings on the direct-to-consumer side is good for our business because it focuses our customers on --  instead of 6-7-8 different choices --  on something a lot smaller that in many respects replaces a video consumer that is less and less valuable to us,” Goei said. “And it allows us to focus primarily on our broadband product, allows us to be a partner for content on a direct-to-consumer basis as opposed to a partner on a linear basis and I think will dramatically improve the economic trends of our business from a cash flow standpoint.”

Goei added that the increased focus on DTC offerings could be an advantage for distributors come carriage renewal time, as the equation shifts toward the DTC model. He added that all of Altice USA’s programming partners have some kind of DTC offering.  

“For us, you want a consumer to be a long-term video subscriber that’s a profitable subscriber, [and] you don't want a video subscriber that’s under three years,” Goei said. “Those [under three-year subs] are the ones that are shifting toward the direct-to-consumer offerings and that's good for us. It’s beneficial to our economics. It makes our priorities very clear, in terms of where we focus our capital allocation and our efforts.”

And that means that distributors are going to look hard at DTC offerings when negotiating future carriage deals. 

“We are going to revisit every equation,” Goei said. “... I think we are going to go through, I would call the next two or three years where you will probably see a big transformation in the MVPD world as to how we partner with our content providers. Because it's not sustainable to continue to see price increases every year with viewership falling.”

At a time when more ad dollars are shifting from traditional TV to digital video, research company Standard Media Index has developed a new metric that enables buyers and brands to better compare the costs of network and cable to over-the-top.

The new metric is effective cost per thousand viewers--eCPM. Brands buy television based on estimates of how many viewers they expect their commercials to reach. Sometimes campaigns exceed those forecasts, sometimes they fall short and, if there’s a guarantee, the brand gets makegood ads to cover the shortfall.

Read Also: Standard Media Index Names Dave Dembrowski VP Sales

Digital ads are sold based on impressions, and commercials stop being served exactly when the contracts number of impressions have been delivered.

To calculate its new metric, SMI takes its detailed TV unit pricing data and ratings from Nielsen to see how many viewers a campaign actually reached to calculate the real cost per thousand or eCPM. 

The buyers and sellers both can use eCPM to compare the cost of broadcast and digital within their campaigns.

“TV has always been a challenge because we haven’t been able to compare digital CPMs to TV’s gross ratings points," SMI president Ben Tatta told Broadcasting+Cable. "In the case of TV it’s really important to find an apples to apples way to understand the effective rate for a show, a network, a daypart.”

He said unless you have the kind of pricing data SMI gets from the buying agencies, including whether ads are bought in the upfront or in scatter or are paid or makegood units, getting accurate numbers is difficult.

“You can do the math for your own inventory, but we can provide that benchmarking capability,” Tatta said. That allows publishers to compare their rates to competitors,’ and for buyers to maximize the efficiency of their campaigns.

Tatta said the SMI is working with Nielsen to determine eCPMs for campaigns based on traditional demographic groups, such as women 18 to 49. It is working with another measurement company to determine the eCPMs of campaigns aimed at advanced audience segments, such as likely car buyers.

“This is all part of our new pricing intelligence suite, that include both digital CPMs, as well as linear eCPMs.

With linear ratings falling, eCPMs for traditional TV are often higher than the CPMs based on pre-campaign estimates.

For example, SMI said the eCPM for adults 18 to 49 in an NFL game is $108. A broadcast primetime show is $93 and tier one cable prime entertainment carries an eCPM of $42.

Tatta said the new eCPM metric can be using for planning and optimizing campaigns.

Though using eCPMs make TV appear more expensive relative to digital video, digital video prices are also high and there are many dayparts and networks where buyers can buy TV without a premium to digital.

“You’d be surprised. On TV, eCPMs really vary by daypart and if you move off prime, it’s really efficient,” Tatta said. Using eCPMs can help identify bargains.

“One of the first myths to bust is that TV is a lot more expensive,” he said.

Eventually both traditional TV and will be bought on an impression-based currency.

“We do think that it will evolve to an impression-based currency on TV. Over time, I think that’s inevitable,” Tatta said.

Comcast said Wednesday that streaming video from apps like HBO Max, Paramount Plus and others accounted for 71% of all downstream traffic on its Xfinity X1,  Flex and Xfinity Stream platforms in 2020, an increase of 70% over the prior year.

In a blog post May 5, Comcast said streaming saw the largest viewing gains on Xfinity platforms in 2020, fueled by the launch of more than 70 streaming services during the year, including HBO Max, its own Peacock and CBS All Access/Paramount Plus. According to Comcast, OTT viewing rose 73% year-over-year on X1 and Flex. 

In addition, 78% of its X1 customers accessed OTT apps each month, up from 68% in the prior year. Of those subscribers, nearly 80% are using more than two apps each month. 

While Comcast is just one company, it is the largest multichannel video programming distributor (MVPD) in the country with 19.4 million video subscribers and 31 million broadband customers. As Comcast and other operators shift the focus of the business toward broadband, streaming and direct-to-consumer services have become increasingly important, evidenced by its own moves into the sector.

Comcast launched Peacock nationally on July 15, and has grown to about 42 million signups at last count. Others DTC services like Disney Plus and HBO Max and Paramount Plus, have 94.9 million, 44.2 million customers, respectively.  

Engagement is also growing. Comcast said that across its entire entertainment portfolio, including X1, Flex and Stream, customers are watching about three hours more per week than they were before the pandemic started. 

Also Read: The Less Discussed Data Points of TVs New Reality 

Viewing was split pretty evenly between ad-supported content and ad-free content, with ad-supported apps like Flex (free to broadband-only customers) and Peacock Premium (free to X1 subscribers). Comcast said that ad-supported content accounted for more than 50% of viewing on Flex, with Peacock, NBCUniversal's Xumo, ViacomCBS' Pluto and Fox's Tubi among the other most-viewed apps on the platform.  

Also Read: Time Spent Streaming Grew 44% in 4th Quarter: Conviva 

Still, Comcast insisted that doesn’t mean that linear TV is dead, especially for sports. Despite the spike in streaming viewing, Comcast said that it saw an increase in traditional linear TV viewing during the year. And they added that data is showing that streaming viewers “value the lean-back experience” of linear. As an example, Comcast pointed to the live guide on Flex, which brings in traditional channels from Peacock, Xumo and Pluto into an integrated guide, is the second most-viewed feature on Flex behind the home screen.

Also Read: JD Power: New Streaming Services Chip Away at Netflix Dominance 

“As we look forward to the rest of 2021, we’re going to continue evolving these three important pillars of our entertainment platforms to meet our customers where they are with the content and features they desire,” Comcast said in the blog post.

Coming off an April 20 virtual upfront for the Bloomberg Quicktake OTT network, touting new shows and additional distribution channels, Bloomberg chief growth officer and global head of strategic partnerships M. Scott Havens said the nascent service has moved well beyond a pandemic-hampered start last November.

Quicktake was supposed to launch in June, but it was tough enough to get going in November, with the pandemic limitations on studio staffing. Basically, the service launched with a few shows and reran them a lot.

Also Read: Bloomberg Launches Streaming News Net for Younger Adults 

“What you saw at the upfront was phase two, which is notable-personality-driven shows,” Havens said. The new slate includes shows featuring NBA star Chris Paul, fashion expert Imran Amed and entrepreneur and marketer Scott Galloway, along with homegrown Bloomberg TV anchor talent.

“I’m working on several more right now, in contract negotiations,” Havens said of the celebrity or influencer-centered shows, which he said can help a network get attention. 

“We’re also kind of rethinking the news product and what does our audience want at what time,” he said. “There’s a lot of excellent brainstorming going on to bring forward something slightly different from what you see today.”

“But we’re getting good audiences,” he said. “There’s a thirst for it.”

Quicktake is a streaming news channel that evolved out of TikTok, a short-segment news service that was initially hosted on Twitter and then spread to other social platforms. It was renamed Quicktake on social media before the OTT channel launched and after the more famous, similarly monikered TikTok came on the scene.

Quicktake's programming is aimed at 25-to-45-year-olds — “modern leaders,“ Havens calls them — with short segments on business and politics and features on technology, innovation, sports, culture, climate change and personal finance, riffing off the news but not focused on stock prices or interest rates the way Bloomberg TV and its OTT version, Bloomberg TV Plus are. It's a decidedly younger audience than Bloomberg TV or Bloomberg TV Plus draws. Following somewhat in the mold of Cheddar (Havens acknowledged it as an early influence), Quicktake seeks a path apart from CNBC, Fox Business and Bloomberg TV and also away from CNN or sports channels or long-form documentaries, Havens said.

The new programs, including one by Bloomberg anchor Francine Lacqua, demonstrate continued investment in content by the parent company. And the live channel currently has 7.4 million average monthly viewers and the on-demand videos have averaged 56 million monthly viewers between December 2020 and February 2021, according to Bloomberg.

YouTube Is Biggest Funnel

YouTube delivers the biggest audience for Quicktake, Havens said. “We’ve found tremendous success there” both in live streaming and on-demand views. Samsung TV Plus also ranks as a big source, he said. Bloomberg TV Plus got in early as a partner with Samsung, he said, and Samsung has become a major OTT platform. 

Quicktake is continually adding distribution partners, the most recent being Amazon’s news app on Fire TV, Fire Tablet and Alexa screen devices, VIZIO SmartCast TVs and the car-top screens on Lyft vehicles. The broader list of outlets includes the Bloomberg App on Apple TV, Roku, Android TV, Samsung Smart TV and Amazon Fire TV as well as on Samsung TV Plus, The Roku Channel, Rakuten TV, Tubi, Haystack News, Local Now, DistroTV, STIRR and News Player Plus.

The aim is to be as omnipresent as possible on a global scale, Havens, who came to Bloomberg in 2015 after stints at Time Inc., Atlantic Media and Conde Nast, said. “We assume everyone has a slightly different media diet, so we’re going to make sure that we’re everywhere you are.”

By year’s end, he said, “I will feel comfortable that we’re pretty much everywhere that you need to be” in the U.S. He said he is still talking to “one of the big Google-owned platforms” but otherwise has gotten Quicktake onto the necessary outlets, either now or in contract to join.

While some multi-pronged media companies have run into conflicts seeking carriage for new OTT services, Havens said Bloomberg has avoided them by being “open-minded and flexible on how we build this brand out and how we build this revenue model.” Some platforms want to retrain the whole advertising inventory, he said, some are not as forthcoming with data as a media partner might like. But at this stage, “we want to be more engaged with everybody than picking and choosing if we don’t get what we want.”

That might change if the Bloomberg properties gain more leverage over time, he said. “Quicktake in two years will have tens of millions of viewers and the power to walk away from platforms, if they don’t want to change their terms,” he said.

New Shows at the Upfront

At the upfront, Bloomberg talked up recent shows whose titles show the territory Quicktake is staking claims on: Next Jobs, Business of Sports, Behind the Design, Future of Work, System Shock and Moonshot, among them.

Chris Paul’s new show, co-produced with the Phoenix Suns star’s company and slated for this fall, is How I Got Here, a weekly one-on-one interview series with guests including entertainers, musicians, athletes and politicians.

The Business of Fashion (working title), featuring Imran Amed and also coming this fall, will use the prism of fashion to explore culture, human rights, sustainability and business topics. 

The Prof G Show, featuring NYU Stern professor and author Scott Galloway, will see Galloway on a weekly basis tear into the taxonomy of the tech business with insights, commentary and humor, Bloomberg said. It's slated to start this summer.

Coming this spring is Morning, Noon and Night, featuring Bloomberg anchors Francine Lacqua in London, Kurumi Mori in Tokyo and Jennifer Zabasajja in New York, is a global discussion of the top stories of the day and how business, politics and culture are reshaping the competitive landscape, the programmer said.

Advantages for Advertisers

Upfronts are aimed at advertisers, and Havens said Quicktake has been growing its ad business after starting out with some charter sponsors including AT&T. “We’re selling more one-off campaigns and features and series sponsorships. We’ve sort of been layering it in post-launch.”

Among the testimonials to Quicktake at the upfront was one from AT&T. “It is both social in nature [and] it’s an OTT platform. It’s finding different ways in which you can tell a holistic story in really different, entertaining kinds of content,” Megan Matlock, AVP of media strategy at AT&T, said in a recorded segment. “It allows us to really hone in and tell our own stories, and align it to really relevant content that our audience is craving and really engaging with.”

Havens pointed out that the audience is growing and attractive, and dollars have been flowing to OTT for reasons other than just the rise in viewership. “Essentially, this is better TV advertising, if the scale does show up. It’s more addressable, you’ve got more data to work with, you can do frequency capping and all kinds of stuff that you weren’t able to do with traditional TV.”

Quicktake is going to keep growing and expanding its programming, Havens said, and finding the best ways to tell stories, through analysis, headlines or big takes. 

There’s a lot going on at Cinedigm, which, through a recent series of acquisitions, has built itself into a clean, mean streaming machine.

Cinedigm has plans to expand its footprint with new channels. Some of those may be built around iconic pop celebrities (think Elvis Presley or Marilyn Monroe) with estates that want to leverage their brands with linear or on-demand channels. Cinedigm is also looking to build networks around some of the best-known sports leagues and teams. 

With viewers cutting the cord and the opportunities for subscriber fees melting away, Cinedigm wants to be the catalyst for taking lower-tier cable networks over the top.  

In March, Cinedigm said it reached 23.8 million viewers, up 208% from last year. It streamed 423 million minutes, up 305%, Total subscribers to its streaming services topped 640,000, up 574%.

“We’re really well-positioned for growth now both organically and through our acquisition strategy,” chairman and CEO Chris McGurk said. 

Beyond streaming, Cinedigm is eying live experiences, virtual screenings and podcasts, and it has 10,000 digital comics in its library.

Cinedigm is also going to jump into the hot market for non-fungible tokens. NFTs are units of data stored on a digital ledger, called a blockchain, which certifies those assets to be unique and (unlike, say, bitcoin) not interchangeable. 

“If we’re not in the NFT business, which we think is a big, big business with our team of engineers and our digital expertise, there’s something wrong with us,” McGurk said. “We have an enormous amount of collectible content,” he said, pointing to 10,000 digital comics and a library of tens of thousands of films and TV episodes. 

Cinedigm will use the NFTs to build a loyalty program for its subscription business, he said.

A Digital First-Mover

Cinedigm has been in the middle of the digitization of the entertainment industry since it was founded 21 years ago, originally converting movie theaters from film to digital projection. 

“The challenge for the company was, how do you take the digital technology and expertise that was in the company’s DNA and its relationships and convert that into a growth business?” said McGurk, who became CEO in 2011. Netflix and Hulu had already launched, and Cinedigm started to turn itself from a digital home-entertainment company into a streaming company through a series of acquisitions that brought it technology and content. It started streaming in 2015. It also sold off most of its non-streaming assets.

“We make money off the streaming ecosystem in more ways than anybody,” McGurk said. Cinedigm’s channels are a mix of subscription, ad-supported VOD and free ad-supported linear television (FAST) channels. They bring in both advertising and subscription revenues.

On top of that, Cinedigm has a large library of digital rights to movies that it sells to Amazon, Netflix and everyone else. “That business is going great guns,” McGurk said. 

Cinedigm also sells its streaming technology, called MatchPoint. ‘“It really gives us a leg up on everybody else,” he said. 

In one of its recent deals, Cinedigm bought out Foundation TV, its partner in developing MatchPoint. “We wanted to control all that IP and be able to direct the effort to take everything to another level on a global basis,” McGurk said.

In 2017, Bison Capital Holding Co. China bought an 80% stake in Cinedigm. Earlier this year, it announced that Chinese investors now own less than 20% of the company. Being Chinese-owned would have subjected Cinedigm to more stringent regulation, making its acquisition strategy more difficult to execute, McGurk said. 

The deal also left Cinedigm with a stronger balance sheet and less debt, he said.

In its fiscal third-quarter ending in December, Cinedigm lost $9.7 million on revenues of $10 million. At this point, McGurk said, the company has streamlined its operation and is investing in growth, rather than prioritizing positive cash flow.

Worldwide Ambitions

Cinedigm is becoming a “clean, mean, streaming machine with global dreams,” The Benchmark Co. equity research analyst Daniel Kurnos said in a report issued in February. 

A year ago, Kurnos said, Cinedigm was majority owned by Chinese investors and had a tiny streaming business. “Cinedigm has completely flipped the script, featuring a strong net cash (nearly recourse debt-free) balance sheet, a much cleaner ownership structure and posting fiscal third-quarter results which significantly exceed expectations,” he said.

“All this leaves Cinedigm, in our view, with a stronger negotiating position to continue and potentially accelerate their streaming acquisition roll-up strategy, which has already paid dividends in the fourth quarter,” Kurnos added. “Layer in a rapidly growing international linear opportunity and a long-awaited EBITDA [earnings before interest, taxes, depreciation and amortization] pivot, and it feels like the party is just getting started.”

Cinedigm has been building distribution for its roughly 17 streaming channels. Unlike Netflix or The Walt Disney Co., Cinedigm’s channels are more niche. “We believe we are completely complementary to the big general-entertainment channels,” Cinedigm chief strategy officer Erick Opeka said. 

The company calls them “enthusiast channels” for fans of documentary, indie films, horror movies, documentaries and anime.  While Netflix makes a few thousand horror movies available, that’s just a fraction of the 125,000 that have been made. 

“If you love horror, you want to be super-served with curation and deep, deep libraries,” Opeka said. “The major services are a mile wide and an inch deep, but we're going to go very deep.”

Reopening Screambox

Speaking of horror, Cinedigm will be relaunching Screambox, which it acquired in February. It is also putting together a bigger and better Fandor, a subscription service it bought in January. Other recent acquisitions include The Film Detective and the Films Around the World library.

Cinedigm’s Chinese connections paid off in April, when the company launched a new streaming channel with Fantawild, a large Chinese theme-park operator and a major animation company there. The channel launched on sets made by Chinese manufacturer TCL, FreeCast and Klowd TV.

The latest film in Fantawild’s Boonie Bears franchise, Boonie Bears: The Wild Life, which grossed $90 million at the box office in China, will be released by Cinedigm for digital purchase and rental before landing on the new linear channel.

Cinedigm is starting to dip its toe into putting original shows on its platforms, Opeka said. The company announced last month that the thriller The Island from ZDF Enterprises will debut exclusively on Screambox. 

Cinedigm plans to continue adding exclusively licensed international productions and getting involved in co-productions. “We’re probably going to ramp that business up,” Opeka said. “We have five or six other potential opportunities on that front.” 

The Bob Ross Channel, which has become Cinedigm’s most successful offering, might get some original programming. The company is talking to the estate of the iconic longtime host of PBS’s The Joy of Painting about new shows that could be produced at low cost, Opeka said. 

Although niche, Opeka thinks the type of channels Cinedigm is building can become substantial. 

“They could end up having tens of millions of subscribers globally, or dozens of monthly viewers, in an ad-supported environment,” he said. “And these are things that transcend borders.”

He pointed to the success of niche services like Crunchyroll and BritBox. “Those are really nice businesses,” he said. Crunchyroll is in the process of being sold by AT&T to Sony’s Funimation for $1.2 billion. AT&T regarded Crunchyroll as a distraction. 

“If billion-dollar businesses are a distraction, we want to be in the distraction business,” Opeka said.

Growing Concern

With its growth, Cinedigm has been hiring at a time when many companies in the entertainment business have been cutting thousands of staffers loose. 

“We're gonna double the size of our workforce by 2022,” McGurk said. “So we're able to bring a lot of new talented people into the company now to help take the company to another level because we’re growing by leaps and bounds.”

The growth will continue if cord-cutting continues, or as Opeka expects, accelerates.

Opeka said the best things on traditional pay TV — even sports — are moving to streaming as the big media companies cherry-pick their assets to feed their new direct-to-consumer businesses.

While many predict pay TV will bottom out with 50 million to 60 million subscribers, “I think it’s more like 35 million to 40 million and I’m obviously bullish on streaming,” Opeka said.

Streaming might even be the answer for cable channels desperately trying to hold onto their subscriber fees. Opeka said Cinedigm can reimagine cable channels with strong brands as FAST networks.

“You look at the bottom tier of the cable universe and there are hundreds of channels globally that will eventually lose their carriage fee-based deals and they're going to have to make a choice,” he said. “Either they adapt to the new FAST and on-demand and subscription environment, or they shut down.”

Media buyers are more optimistic in 2021, but they said they're looking to spend less upfront and more programmatically, according to a study by the IAB.

The IAB said that optimism among buyers has increased in just the past five month when its last survey was taken. In the new survey 21% were very confident and 40% were confident. Just 11% of buyers said they were not confident. 

The buyers also said that their media budgets were being reviewed less frequently, which could indicate some consistency in the market.

The IAB, which represents online media companies, said buyers expect digital video, including over-the-top and connected TV to have the highest share of media budgets at 20%. That compares to 18% for linear broadcast and cable TV.

The buyers said they liked digital videos wide audience, young consumers and influences fan bases.

While buying CTV, more money is moving programmatically, and less in the traditional upfronts. The survey found that 54% of buyers said they’ll allocate more money to programmatic. When it comes to the upfront 37% said they’ll be allocating fewer dollars and 31% said they’ll spend less in the TV scatter market.

Among linear TV buyers 37% said they allocate less of their budgets to the traditional upfront and 37% also said they’d allocate less to the TV scatter market.

The top item media buyer said they were investing in was first party data. Spending on first party data is expected to rise 26% in 2021. Buyers are also investing 23% more on measurement KPIs and 23% more on shoppable ads

The survey found that 64% of buyers were using a self-service platform for buying digital video. 

More people were consuming content on over-the top platforms than on traditional TV by the end of last, according to a new multinational report from programmatic company MiQ.

The COVID-19 pandemic boosted usage of both traditional TV last year in the U.S. and five other countries, with a spike happening between March and May, the report said. In that period, nearly 100% of viewers watched some traditional TV. Around 90% were watching over the top at that point.

Usage dipped until turning upwards again in July. By November, nearly 100% of of people were content on OTT platforms and about 95% were using traditional TV, according to MiQ.

“Content consumption on OTT platforms has grown 19% among people aged 18-34, the traditional OTT loyalists. But it’s grown even more strongly among people aged 35 and older (21%), many of whom are likely to be new to OTT,” the report said. 

MiQ said the growth in OTT ad inventory was less a boon for marketers than a mix back. 

In the early stage of the pandemic, which viewers were locked down at home, there was a decline in the viewability of ads.

Since then, viewability has improved to above pre-pandemic levels, MiQ said.

Video completions have also recovered from a slump in March-April 2020 and are up 3.8% year-on-year with consumer responses to video ads being more pronounced in the U.S., Canada and the U.K.

“In short, it’s taken a while for the increase in online activity to start paying dividends for marketers, but the data is starting to suggest that the year in lockdown has made consumers more receptive to online advertising, particularly in the more mature programmatic markets like the US, Canada and the UK,” the report said.

MiQ's data comes from digital devices as well as viewing information from connected TVs. It compared its data with results of a survey of global customers conducted by Sapio Research to identify changes in consumer considerations.

Netflix doesn’t have commercials. Subscribers have always liked that and made Netflix the No. 1 streaming service. HBO never had ads. It’s not TV, it’s HBO, after all. Or at least it wasn’t.

In June, AT&T’s WarnerMedia unit will launch a version of the subscription video-on-demand service HBO Max that will have commercials. Around the same time, ViacomCBS will be launching an ad-supported tier of its Paramount Plus SVOD service. Those follow on the heels of launches of the Discovery Plus SVOD offering in January and Comcast’s Peacock last year, both of which give subscribers the option to watch commercials or pay more and avoid them.

Those media companies will be spending big to get consumers to sign up — maybe you saw their Super Bowl ads — and pushing hard to get advertisers to sign on during the upcoming upfront.

Dawn of a New Era?

“This year is going to be the year,” Geoffrey Calabrese, chief investment officer for Omnicom Media Group, said. “This upfront is going to really set up the future of everything. You’re going to see a pretty substantial shift” in ad dollars moving from linear TV to streaming. “It’s just a fascinating time to be in the business.”

This SVOD formula of streaming technology, direct-to-consumer relationships and advertising addresses some of the TV industry’s biggest recent problems. Over-the-top programmers such as Netflix or Amazon Prime Video (which don’t run ads) have been driving consumers to cut the cord, depriving networks of subscriber revenue and reducing the number of eyeballs they have to sell to advertisers. And as audiences get smaller, it is harder for marketers to reach consumers and commercials get more expensive on a cost-per-consumer basis.

“Traditional linear TV is experiencing such a significant decline in viewership that available inventory is falling in a pretty meaningful way,” said Brian Wieser, global president, business intelligence at agency GroupM. “You’ve got some problems if you’re an advertiser.” 

But adding commercials might not be an easy fix for media companies. Netflix, Amazon, Apple TV Plus and Disney Plus are likely to remain commercial-free. “If the dominant players have no ads, it’s going to be hard to be competitive if you have more than a light ad load,” Wieser said.

More Ads, Lower Prices

Viewers also have a problem paying for the growing number of streaming services that are springing up. Subscription prices can be lower — if a viewer is willing to watch commercials.

“Advertising, when executed thoughtfully and elegantly, is a powerful way to lower prices for everyone,” WarnerMedia CEO Jason Kilar said in laying out plans for an ad-supported version of HBO Max that will launch in June.

The ad-supported version (which WarnerMedia hasn’t disclosed pricing for yet) won’t offer Warner Bros. movies at the same time as they are in theaters, a key feature of the premium SVOD service, and it won’t have commercials added to HBO original shows.

“I also believe that marketers are going to be delighted, thanks in part to the safe, addressable, premium environment unlike any service out there,” Kilar said. “The pre-launch response from marketers certainly suggests that they agree with these statements, given that we already have $80 million in upfront commitments.”

Kilar knows a bit about streaming services and ads from the days when he launched Hulu. Hulu, which is now controlled by The Walt Disney Co., has an ad-free version and its ad-supported version is the leader and model in the connected-TV space with its targeting capabilities and innovative ad formats. Hulu has said in the past that about 70% of subscribers to the SVOD service choose the lower- cost version that has ads.

Hulu and the other streaming services will be a massive part of this year’s upfront pitches — although some question how much inventory they’ll have to sell.

“They will 100% be a part of the upfront conversation and a larger part of that conversation each year from here on out,” David Campanelli, chief investment officer at Horizon Media, said.

“I would say it’s their No. 1 priority,” Omnicom’s Calabrese said. “It’s going to be a big push in the upfront, absolutely.”

The ad-supported versions of HBO Max and the rest could be a solution to the loss of reach that TV networks and their sponsors have been experiencing. It’s been hard to get firm numbers of subscribers to some services from salespeople, but Calabrese expects to get good data once campaigns start to run.

HBO Max is promising a maximum of four minutes per hour of ads, Calabrese said, and is offering premium content, unique ad experiences and a safe environment when parts of the streaming world can be like the Wild West.

Paramount Plus and the others are making the same sort of pitch. “There are different flavors, but there is a lot of similarity,” Calabrese said. “I think a lot of people are drafting off the success that Hulu’s having in the space.”

Hulu is The Walt Disney Co.’s ad-supported entertainment SVOD, paired with ad-free Disney Plus.

“All of the streamers have really done a nice job of presenting what their capabilities are and what we can expect,” Calabrese said. “The more they build scale and the more sophisticated their addressability gets, the more effective they’re going to be.”

The streamers also expect advertisers to pay top dollar for the lack of clutter, precise targeting and better data about campaign performance. “That’s my job, to make sure it’s not a premium price,” Calabrese said.

Much of this new streaming video will be sold programmatically. So far, some streamers are getting prices equivalent to those seen in the upfront and scatter market, said Scott Schiller, global chief commercial officer of Engine, a global, full-service media and marketing services company.

“It’s better for the marketer that they will eventually be able to target very specific audiences in the genres they want,” Schiller said. But, as when cable was new, the streaming services are getting 40% of the audience but only 5% of media spend.

Comcast’s NBCUniversal unit introduced Peacock last year with a free, ad-supported tier; a premium tier ($4.99) that has more content, including sports programming; and an ad-free option for $9.99.

“We created Peacock with the marketer and the consumer at the heart of what we’re doing,” Laura Molen, president of advertising sales and partnerships at NBCU, said. “It’s the best of premium content combined with our technical prowess.”

Peacock launched with a group of sponsors, each of which was promised a share of Peacock’s audience. They included State Farm, Target and Unilever.

Molen said that 77% of Peacock viewers said they liked the low amount of ads on Peacock, a 10% higher score than other streaming services, and 76%  said Peacock did a good job showing them a variety of ads, rather than the same ones over and over.

But NBCU hasn’t disclosed how many people are choosing the ad-supported version of Peacock and which version generates more revenue. Peacock also has sports content. 

Ads on Peacock can be unique. State Farm worked with the creators of The Office on a spot that showed someone throwing a stapler through a window and invited viewers to send “Jake from State Farm” their own funny home-office stories. 

But for 2020, Peacock generated just $118 million in revenue and lost $914 million, according to a Comcast financial filing.

More recently, NBCU opened Peacock ad sales to additional clients. And last month, it said inventory on Peacock would be sold programmatically and included in NBCU’s cross-platform planning systems. 

“We’re in the market now talking to advertisers about Peacock in the upfront and we’ve been really getting great feedback, great interest in Peacock,” Molen said.

NBCU’s last official announcement was that Peacock had generated 35 million signups. Molen said Peacock has been growing and that it’s pacing to have the same kind of mass reach for key demographic groups such as adults 18-49 as broadcast prime — and is being priced that way.

“Peacock is really the most premium of all things that we have right now,” she said. “It’s really up there in terms of prime, Olympics, NFL, our most premium products.” 

ViacomCBS had launch partners for Paramount Plus when the streaming service debuted in March, even though the $4.99 a month ad-supported version won’t be here until June. (The $5.99 version of CBS All Access is still available.) Those sponsors included heavyweights like General Motors, Procter & Gamble and Expedia. A co-branded spot promoted GM’s electric vehicles.

Those sponsorship deals end in June and ViacomCBS is looking to renew those and get new advertisers to sign up, said David Lawenda, executive VP, digital sales and strategy at Viacom­CBS. There are active conversations and some advertisers have already signed up for the second half of 2021, Lawenda said.

ViacomCBS’s High EyeQ Play

Paramount Plus is being sold in scatter and in the upcoming upfront auction as the anchor product of ViacomCBS EyeQ, the company’s consolidated digital content advertising offering. EyeQ’s video inventory provides massive reach with 60 million full-episode viewers per month, with 80% of viewing taking place on TV screens. And 45% of that reach is incremental to linear TV, Lawenda said, because many EyeQ and Paramount Plus viewers are cord-cutters and cord-nevers.

EyeQ Video can be bought based on traditional age and gender demos or on advanced target segments. Inventory can be bought directly, via programmatic guarantee or through a private marketplace. “We’re giving advertisers a lot of choice here,” he said.

EyeQ Video also has “content pillars” that match up with linear programming, such as primetime replacement, with inventory in the most-premium shows including the Paramount Plus originals. There are pillars that mirror the company’s cable programming and sports.

“Clients and agencies know they have to move a significant amount of investment to streaming video,” Lawenda said. “Otherwise they’re going to be facing significant year-over-year rates of change [in price]. You don’t get any closer to television that ViacomCBS EyeQ.” 

In the upfront, EyeQ will be a big part of the conversation at ViacomCBS, as a supplement to broadcast and cable. “Any ratings point that we’re losing in broadcast and cable can be made up through EyeQ and we’ve made it easy for clients to transact," he said. "You can be certain at this year’s upfront that EyeQ is an extension and complement to everything we are doing in broadcast and cable.” 

If clients want to buy a full rotation of digital inventory and don’t insist on particular programs, networks or dayparts, “we can make that very efficient, more efficient than broadcast.” But if a client wants just EyeQ Prime, the price is comparable to broadcast prime, he said. 

Discovery Plus was launched in January in two versions, one without ads for $6.99 a month and one with ads for $4.99. The ads sold out in the first quarter, said Jon Steinlauf, president of ad revenue at Discovery. “We’re running at full capacity,”
he said.

Discovery shows are produced with four breaks per hour. On Discovery Plus, each of those breaks is one-minute long, with a countdown clock to let viewers know when the show will return.

Some of the ads were sold in the upfront market, even though a firm launch date wasn’t announced until December. Some sold in scatter. Programmatic sales are taking Discovery Plus to sellout, the company said.

Impressions sold through demand-­side platforms have gone for higher cost per thousand (CPM) rates with more targeting, Steinlauf said. Those advertisers are likely looking at the cost per incremental reach point. 

Streaming is changing the way Steinlauf, a longtime sales executive for Scripps Networks such as HGTV and Food Network and now for Discovery, looks at TV. Instead of waiting for overnight cable ratings, he can check a dashboard at 7 a.m. to see what Discovery Plus subscribers watched and how they watched it.

Targeting Binge-Watchers

One surprise is how binge-worthy some of Discovery’s shows are, like House Hunters,  Deadliest Catch and Gold Rush, he said. Discovery is working on its own version of a binge-watching ad that will let viewers know that, thanks to a sponsor, they can watch the fourth episode commercial free.

Older shows from networks like Animal Planet and Science are getting new life via streaming, he added.

The future of the TV business is having  a really smart algorithm that figures out what people like to watch and helps them find it, Steinlauf said. “The algorithm is the key to this business because I think it will make the experience so much more responsive for the consumer.” 

Discovery learned that, and other lessons, from its authenticated Go app, which launched about five years ago. In addition to curating content, Discovery had to develop programmatic technology and relationships. Lessons learned, the Go apps have been the fastest-growing part of Discovery’s ad business.

Discovery has also found that ads on its Go apps generate CPMs that are twice that earned by cable networks. Discovery Plus, which reaches beyond cable subscribers, is getting triple cable’s CPMs.

Steinlauf noted that the streaming ad business is different from the traditional TV business. Much of it operates on impressions among people age 2 and up, instead of ratings in a demo. Delivery is measured by ad servers at FreeWheel, instead of Nielsen, and impression guarantees and frequency limits can be managed in flight. And when the agreed-to number of impressions is reached, the ad stops running. No more underdelivery or overdelivery.

And that brings us back to the upfront. It’s generally accepted in the market that the supply of impressions in linear channels will be tight, forcing advertisers to buy digital video.

But Steinlauf says no one knows how much premium digital video supply there will be.  All of these new streaming services have launched, but they’re still working to add and keep subscribers. And all of them have really low ad loads, he notes.

“With six to 12 months’ worth of data in between upfronts, who’s got the confidence that their app is going to grow subscribers and grow hours watched?” he asked.

“We’re not swimming in supply here. My personal opinion is that digital video is going to be tight and that’s going to cause an even tighter upfront marketplace.” 

After much fanfare, ViacomCBS has launched Paramount Plus, its direct-to-consumer streaming service.

Paramount Plus may be the last of the big Plusses the industry sees for a while. Most of the other media companies have already dived into the streaming stream and the competition to scale up to the levels of Netflix and Disney will be intense.

From a distribution standpoint, Paramount Plus got off to a solid start, with a presence on the big streamers, including Roku and Amazon Fire TV. Comcast has it also. Unlike Disney Plus, HBO Max and Discovery Plus, Paramount Plus did not have a mobile partner offering it free to ramp up its launch.

The initial version of Paramount Plus, a bulked-up, rebranded version of CBS All Access, costs $9.99 a month and is ad-free, except for the live feed of CBS. A more ad-supported version, costing $4.99, is expected in June. It will not have the live CBS feed.

Subscribers will be able to watch more than 30,000 episodes and a large number of films from ViacomCBS’s brands, as well as live news and sports.

The SpongeBob Movie: Sponge on the Run is available at launch along with Kamp Koral: SpongeBob’s Under Years. Paramount Plus also has its own, updated versions of shows ranging from 60 Minutes to The Real World. 

With the Paramount name on the door, the service will also be offering films from Paramount including A Quiet Place Part 2 and Mission Impossible 7 just 45 days after their theatrical release.

ViacomCBS told analysts it expects to increase its number of global streaming subscribers to 65 million to 70 million by 2024 from the current 30 million. It also expects streaming revenue to grow to $7 billion annually.

“Competitive pressures for the top spots in consumers’ video-subscription preferences only keep becoming more intense, and the path to profitability or the ultimate margin profile for ViacomCBS’s services remain unclear to us,” RBC Capital markets analyst Kutgun Maral said.

A majority of pay TV subs want the ability to stream TV shows and movies to be part of their pay video service.

That is according to a new survey of consumer perceptions of Pay TV services conducted by Parks Associates.

"In late 2019, the market reached the crossover point where the same percentage of US broadband households subscribed to an OTT service as subscribed to a pay-TV service, and now OTT adoption outpaces pay TV by double digits," said Parks Associates senior researcher Kristen Hanich.

The good news is that OTT and traditional pay TV is not currently an either/or proposition since the vast majority of video subscribers (79%) have both a Pay TV and OTT subscription. But Hanich said providers need to come up with new business models or risk losing those video subs.

That is because while online video has grown, cord-cutting has too. "Pay-TV providers must keep offering their most valuable content, which includes live sporting and cultural events," said Hanich. "Additionally, they must offer access to streaming, target new service to their interested customers, and perhaps be willing to take a hit on pricing until this chaotic market stabilizes."

Among the new services the survey found could be value-added are video calls on the TV (43% said they were interested), controlling smart home devices through the TV (40% were interested), and playing on the TV with a cloud gaming service (34%).

According to Parks, the data was based primarily on an online survey of 10,000 heads-of-broadband households polled in third-quarter 2020. 

The Multichannel Landscape

Total multichannel television households, including virtual multichannel video programming distributors (vMVPDs), will fall to only 61.2 million in 2025, according to projections from Magna. Virtual MVPDs will see a modest uptick to 12.4 million by 2025, while cable subs will drop from 45.7 million in 2021 to 34.9 million in 2025. 

Viewer Watch 2021: More Streaming, More Uncertainty | Digital Diversity Key to Streaming Success | Beyond Cord-Cutting: Reinventing Multichannel TV | Looking Ahead to Post-Pandemic Tech | Streaming Platforms Are Doing It Live

The Multichannel Business

Subscription TV revenue, which peaked at $101.1 billion in 2015, will fall to $81.3 billion in 2021 and further fall to $76.9 billion in 2024, PwC predicts. The sub losses will also hurt multichannel advertising, which is projected to grow from $24.6 billion in 2021 to $26.2 billion in 2024.

The Advertising Landscape

Digital advertising will be more than four times larger than TV advertising by 2025, when spend on digital will hit $205.8 billion, versus $44.1 billion for TV. Digital video, meanwhile, will rise  from $17.1 billion in 2020 to $26.7 billion in 2025. 

The Content Game

Electronic delivery of home video content continues to grow, hitting $26.2 billion in 2024 for rentals and $6.1 billion for the sell-through sector, according to PwC, while gaming and eSports will top $37.1 billion by 2024.

The Broadband Landscape

Revenue from fixed broadband, which has been a bright spot for cable operators in recent years, will continue to grow, hitting $70 billion in 2024, according to PwC. And the amount of data flowing over broadband networks will continue to skyrocket, from 239.7 trillion Megabytes in 2020 to 391.3 trillion MB in 2024, with much of that — about 331.6 trillion MB — consisting of video.

The OTT Landscape

Subscription video-on-demand revenues will rise to $24.5 billion by 2024, while total revenue from over-the-top sales and subscriptions will hit $30.9 billion in 2024, according to PwC.

The Emerging Platform Landscape

Consumers report that about 46% of their weekly viewing time is now spent watching subscription VOD, live-streaming or ad-supported VOD services, per survey data from Magid. Only 23% of viewers ages 13-17 say watching shows in real time on broadcast or cable is their preferred way to view video. 

The Multichannel, Multi-Device Landscape

African-Americans are more likely to have a multichannel subscription than consumers overall, but consumers in that demographic also subscribe to streaming services at higher rates, according to Horowitz Research.

The Cord-Cutting Landscape

In 2011, less than 2% of all pay subscribers told Magid researchers they planned to get rid of their pay TV subscription. Today, that figure stands at 9.1% while Horowitz Research reported that more than half of households (58%) subscribe to an SVOD service and a vMVPD.

While all of the major programmers are touting their commitment to streaming and pouring billions of dollars into developing new content for those services, they are hardly abandoning the pay TV industry. 

“I’d say the challenge for us and everyone else continues to be how to reach and engage with consumers across a bunch of different options,” including direct-to-consumer and traditional pay TV, noted Disney Platform Distribution president Justin Connolly. “We still have, and we expect to continue to have, really strong relationships with a host of third parties in the multichannel environment, and we will continue to invest in those relationships because there are consumers who want those services.”

Rick Cordella, executive VP and chief revenue officer at NBCUniversal’s Peacock, expressed similar sentiments. “I think Peacock is positioned to be complementary to the pay TV ecosystem,” he said. “We are not hoping to pull people out of that bundle, we are hoping to add to what people are already consuming from the streaming standpoint.”

A key question is how quickly the traditional pay TV universe will decline.
“If you look ahead 10 years, I think everyone, including the big cable operators, would probably predict that there will be more direct to consumer,” explained Andy Forssell, executive VP and general manager of WarnerMedia Direct-to-Consumer. “But nobody knows at what rate. So for us it involves a little bit of a balance and a recognition that consumers are going to decide. Given the trends in multichannel subscriber homes the last couple of years, you would assume that world would drop a little but there are tens of millions of those customers and they are really important to us.” 

Ian Olgeirson, research director at Kagan, the media research unit of S&P Global Market Intelligence, noted that in 2020 “we saw an acceleration of defections from traditional multichannel service and for the most part those are doing to streaming services,” though the losses were much less severe in the third quarter of 2020.  

Kagan data shows that in the first nine months of 2020, traditional multichannel TV subscribers declined by more than 5.6 million, down  6.8%, compared to a drop of 4.9 million subscribers, or 5.5%, in the first three quarters of 2019 and a drop of 3.1%, or about 2.9 million subscribers, in 2018.

Consumer Centric

To thrive in this rapidly shifting landscape, researchers stressed that companies will have to better understand consumer trends and rethink some of the old debates over streaming that no longer reflect the realities of the video business.

“We talk about cord-cutting as a central issue, but it is really bigger than that,” Adriana Waterston, senior VP of insights and strategy at Horowitz Research, said. “It is really about the ongoing value of multichannel services.” 

The lines between over-the-top video and pay TV are rapidly blurring, she said, with traditional cable operators adding SVOD services and streaming platforms like Roku offering live linear channels.

“What is going to be the actual value of a multichannel subscription when really all of the major media brands, with a handful of exceptions, can be accessed direct-to-consumer?” she asked. “What does that mean for the premise, the whole business model of multichannel TV?”

Meanwhile, many programmers are crafting streaming strategies that look far beyond their old focus on cord-cutters. “I think people are now recognizing that streaming is just TV and placing less emphasis on just the mindset of the cord-cutter,” Newsy chief of staff Tony Brown said. “Cord-cutting isn’t about a single particular mindset. In many ways it is a ubiquitous swath of the audience.”

Added NBC News Group executive VP of digital Chris Berend: “We’ve reached a state where streaming is no longer a niche experience and the connected consumer is no longer young first adopters. You are getting parents and grandparents using these apps.”

Old debates about cord-cutting can also obscure real consumer trends and changes in the business of multichannel TV. “Subscriber net losses are as much about provider strategy as they are about consumer behavior,” stressed Bruce Leichtman, president and principal analyst at Leichtman Research Group. 

“Over the past two years, AT&T has lost a significant number of pay TV subs,” Leichtman said of the DirecTV parent. “Over the last year, AT&T has accounted for 72% of all pay TV net losses. That wasn’t purely because consumers said, ‘I hate my satellite dish.’ There was not a dramatic increase in disconnects, but there was a slowdown in connects, because AT&T had a change in strategy and marketing” and was not heavily promoting the services.

Virtual Rebound?

Rethinking trends in the pay TV industry is also important because various operators and sectors have responded differently to consumer demands for new packages and content, producing notably different results. 

The top pay TV operators serving about 95% of the market lost about 120,000 net video subscribers in the third quarter of 2020, Leichtman noted, far fewer than the 945,000 lost in the third quarter of 2019. Virtual multichannel video programming distributors (vMVPDs), such as Sling TV or YouTube TV, “had the best third quarter they’ve ever had and the whole pay TV industry the best quarter since 2018,” he said. 

Consumers had embraced vMVPDs because they were generally less expensive and offered more flexible video packages. But growth slowed in 2019 as vMVPDs raised prices and saw subscriber declines in the first half of 2020 as live sports disappeared from the air.  

David Gandler, co-founder and CEO of FuboTV, noted that “in the first quarter pundits were saying it was all over for virtual MVPDs, but then in the third quarter there was clearly pent up demand for sports” and subscriptions dramatically increased with the return of live sports. 

“I think that vMVPDs will continue to take share, not only subscriber share from the traditional services, but I think they also start to take significant amount of time share in the video ecosystem and their share will be dramatically higher in 2021 than it was in 2020,” Gandler said, adding that FuboTV subscribers now spend about 120 hours a month on the platform. 

I Want My OTT

While operators continue to offer large traditional video packages, they’ve also embraced the idea of creating a variety of new products that include OTT content. 

“Do we want to start teaming up [with] more OTT providers?” Altice USA CEO Dexter Goei said during the company’s Q1 2020 earnings call, reflecting widespread industry sentiment. “Absolutely. We are in all those discussions as you may expect.”

“The video business is changing and we are innovating accordingly,” added Jodi Robinson, senior VP of digital platforms at Charter Communications. As part of that effort, Charter has developed lower-cost packages “targeted primarily at customers that are not currently purchasing our traditional video product,” she said. “Going forward, we will offer even more tailored programming packages.” 

Cox Communications senior VP of marketing operations Kristine Faulkner stressed the importance of rethinking video packages and offering consumers more choices.

“We are focused on hitting two primary segments,” she said. “Those are the more traditional sports enthusiasts who want it all and those who are really looking for a better search and discovery experience for their streaming services.”

All of this is part of a sea change in the way operators are thinking about their business, TiVo VP of product Chris Thun said. 

“Several years back, I’d get into religious debates with operators about whether it was really good for operators to combine OTT with linear or should the operator content be in a walled garden,” Thun said. “That phase is gone. I’m never in those debates any more. Everyone has accepted the idea.” 

Operators are also looking at video packages as a way to keep broadband customers, which have become the bedrock of their business. “They are saying we have a growing segment that isn’t taking video from us and are broadband-only customers,” Thun said. “That is actually their most profitable segment, and to make it more profitable they want to reduce churn.” 

This also opens up some opportunities for smaller niche programmers who can attract loyal audiences. “People are looking for brands they value and trust where they can go for news and entertainment,” said Patrice Courtaban, chief operating officer of TV5Monde USA, adding that the premium French-language channel saw reduced churn in 2020, increased viewing and more use of the authenticated TV  everywhere app.  “That is where we can help operators reduce churn.”

The explosion of content, though, creates problems for consumers and high levels of churn in the streaming world. “We still see high levels of churn,” Andrew Hare, senior VP of digital research and strategy at Magid, said. “About one in five say they sign up for an SVOD to watch a show and that they intend to cancel after they binge through it. The premiums have always had churn issues, but I think there is now a churn mindset in streaming.”

Churn Busters

To reduce churn and retain customers, pay TV operators and streaming services should try to improve the consumer experience, said Devin Emery, chief product officer and executive VP of content strategy at CuriosityStream. “Making it easier to find content is extremely important to consumers,” he said, adding that “we think our strength is becoming the best portal for factual content.”

In general, it’s important to be customer-focused. “One problem the traditional MVPDs have is the poor consumer perceptions they have gotten over the years,” Horowitz’s Waterston said. “Today, the product offering may better conform to what consumers want but the brand perceptions are still there. Nothing is really going to change until they deal with those perceptions and the very real problems they have with customers today.”

 With 2020 mercifully winding down and a virtualized version of CES about to ramp up, it’s a good time to look at the gadgets and software platforms that will matter most in the year ahead.

At this time last year, Multichannel News predicted relevance for 5G-capable smartphones and WiFi 6-compatible home network gateways, and of course, the obvious ramped-up competition for subscription streaming, all of which became manifest over the past 12 months. 

If we were truly prescient, we might have devoted a paragraph or two to remote conferencing software. But hindsight is 20/20.

So what will the big technology topics be this year? Here are five we think we’ll be covering quite a bit. 

The ‘Platform Wars’ will only intensify: We heard a lot about the so-called streaming wars in 2020, and how the inclusion of Disney Plus, Apple TV Plus, Peacock and HBO Max were going to put competitive pressure on Netflix. 

It soon became apparent that the race for platform supremacy was just as intense, with all of the relevant subscription VOD, AVOD and vMVPD combatants relying on Roku, Amazon, Google, Apple and other over-the-top gatekeepers to reach their consumers. 

ALSO READ: Discovery Plus to Explore Challenging SVOD Biz with Lofty 70 Million Subscriber Goal

The competition among the streaming gatekeepers will only heat up in 2021. Roku has seen its market capitalization double in recent months to surpass $40 billion, and it’s now making more money selling advertising than hardware, Roku can now afford to turn its OTT gadgets into loss leaders at retail, selling them on the ultra-cheap (below $20) and further proliferating its leadership position in the connected-TV device world.

Hot on Roku’s heels, touting a similarly robust 40 million active users worldwide, Amazon will continue to integrate its Fire TV OS into almost every home control and automation device it sells, while also peddling inexpensive OTT gadgets such as HDMI streaming sticks.

The wild card will be the emergence of Google and its Android TV/Google TV OS. Google plans on investing heavily in 2021 to join Roku and Amazon at the table of serious global OTT device platform operators. 

“What makes Google such a dangerous entrant into the TV OS/device space is that they do not need to make money (at least today) on taking a cut of connected TV ad inventory or a share of new SVOD subscriptions,” LightShed Ventures general partner Rich Greenfield said in a recent analyst note. 

More OTT ‘carriage’ disputes:  With their growing clout, and decreased neutrality in terms of what gets streamed on their platforms, Roku and Amazon will certainly be involved in more distribution skirmishes in 2021.

Roku added HBO Max just last week, while Amazon Fire TV still doesn’t offer NBCU’s Peacock. Roku also just made the Spectrum TV app unavailable to its users, as it is still negotiating a new distribution deal with Charter Communications. 

Notably, Discovery didn’t specifically say it had deals with Roku, the No. 1 OTT platform, or No. 2 Amazon when it announced its new Discovery Plus SVOD Platform.  And with CBS All Access just as entrenched in the channels business of Roku and Amazon as HBO ever was, what are the chances that ViacomCBS will launch the broadened Paramount Plus with ubiquitous app support?

Expect big, surprising new smart TV partnerships: If you think gateway operators like Roku and Google wield a lot of power now, just wait until one of them reaches what Liberty Media chairman John Malone recently said is the magic number of subscribers to truly control the market — around 100 million active users. 

The key to achieving that benchmark is tie-ups with smart-TV makers. Roku, for example, emerged as the No. 1 OTT ecosystem in the U.S. thanks mainly to its highly successful marriage to China’s TCL, whose cheap 4KTVs have sold like gangbusters in the U.S. since 2017. Roku is now working with TCL to establish similar smart TV beachheads in Europe, but TCL is seeing other tech companies, evidence by a recent U.S. Android TV deal.

And there will be plenty of big smart-TV announcements in 2021. 

Comcast, for example, is looking to get its X1 platform into the smart-TV game with a potential collaboration with Walmart. And TiVo plans to leverage the established smart TV OEM business of its new parent company, Xperi, to put its Stream TV platform into sets starting in the latter half of 2021. 

4K/UHD will become ubiquitous:  Amid all the movement among platforms and service providers, emerging next-generation playback formats, such as 4K/UHD, HDR, Dolby Vision and Dolby Atmos will become more standard. 

ALSO READ: HBO Max Gets WarnerMedia’s Entire 2021 Film Slate Day and Date

Lost in all the hubbub about WarnerMedia releasing its entire 2021 theatrical slate day-and-date on HBO Max: All 17 of those movies will include each of the aforementioned technology features. 

To keep up, ops will invest in broadband: Controlling around 70% of the U.S. wireline internet service provider business entering 2020, cable operators were largely ready when the pandemic suddenly spiked broadband usage, with the amount of digital video sent over the internet — vocational and recreational — vastly increasing. 

Operators, who’d spent billions on DOCIS 3.1 upgrades, largely implemented tweaks and node splits that were part of the technology they already owned, and they kept up with demand. 

Analysts expect these companies to circle back to earlier planned broadband infrastructure upgrades in 2021, transitioning networks to software virtualization and distributed access architecture (DAA). Dell’Oro Group predicts that global spending on broadband access equipment will rebound by around 5% in 2021. 

The FCC has granted Cox and Comcast petitions for "effective competition" determinations in a number of Massachusetts counties, citing over-the-top service AT&T Now as the effective competitor.

In October 2019, the FCC made its first determination that over-the-top streaming video service was a competitor to cable systems in local markets, granting an effective competition petition from Charter in Massachusetts also citing AT&T Now (formerly DirecTV Now). 

Also Read: FCC Says OTT is Effective Competition

A finding of effective competition lifts basic-cable price regulation, which has now been eliminated in all but a handful of systems thanks to the ubiquity of satellite service. Cable operators deemed subject to effective competition also do not have to provide broadcast TV signals on the basic tier, though they still do.

Comcast and Cox then followed suit with their own petitions, citing the Charter precedent.

"Comcast and Cox, however, have reasonably demonstrated that AT&T TV NOW can and does reach consumers in the Franchise Areas either with their affiliated broadband Internet access service or that of a competitor," the Media Bureau said in granting the petitions.

The Charter decision did not stop the State of Massachusetts from opposing the Cox and Comcast petitions.

Classifying as 'effective competition' a non-facilities-based video service like AT&T TV Now, which requires the broadband facilities of a third party like Cox to get its video to its customers, would undermine the commission’s policy goal of encouraging facilities-based investment and limiting regulation of the internet," the state argued.

Following that logic Disney Plus and Netflix and others would not meet the definition of video service competition to traditional cable, even though they are clearly pulling eyeballs away from both day-and-date and VOD cable content.

Netflix certainly doesn't see it that way. In a 10-K filing it said its competition includes MVPDs, and points out that it has more than 167 million paid subscribers.

While the FCC prefers facilities-based competition, it does not exclude non-facilities-based competitors from the regulatory conversation in other areas. For example, it approved the T-Mobile-Sprint deal in part because Dish gets to run the companies' spun-off prepaid wireless business, which still requires Dish to use the Sprint and T-Mobile facilities, as part of the effort to create a competitor to the merged wireless providers.

To avoid a return to basic cable regulations, cable operators are looking to establish the precedent that OTT video maintains the effective competition status of almost all systems today, and do so now, as cord-cutting continues to cut into subscriber counts for traditional competitors and as over-the-top becomes the video delivery system of choice for former satellite customers.

Cable companies fear that if the subscriber counts for DirecTV or Dish Network go south, local franchise authorities could cite that as a reason they were no longer subject to effective competition and reinstate basic rate regulations.

The item raises the issue of just how the FCC should define OTT services beyond effective competition, and the specter of subjecting them to the same regulatory regime, such as program-access and program-carriage rules.

A global coalition for the protection of online content has gotten a crystal clear ruling from a U.S. district court against an unauthorized streamer.

The Alliance for Creativity and Entertainment (ACE), whose members include the major legal content producers and streamers, from Amazon, AMC Networks and Apple TV to Viacom, Walt Disney Productions, and Warner Bros., said it has secured a permanent injunction against Crystal Clear Media (CCM).

ACE is chaired by Charles Rivkin, who heads the Motion Picture Association (MPA).

According to a copy of the injunctions, the operators of CCM agreed to comply with the injunction as well as to a $40 million judgment for damages. Each party will pay their own attorneys fees.

“Crystal Clear Media’s massive, leveraged piracy operation posed a direct threat to the legitimate streaming market that people are depending on today more than ever,” said Karyn Temple, MPA senior executive VP and global general counsel. “Illegal online piracy hurts ACE members and strains an already challenged delivery system. It threatens jobs, destabilizes the economics that promote creativity and keep streaming affordable, and puts consumers at increased risk of malware, which is often used for identity and financial theft and other nefarious schemes.”

The suit was filed in August 2020.

The competition among OTTs has gotten heated in 2020, with new services like Peacock and HBO Max launching, as well as economic stresses caused by the coronavirus pandemic. Providers are all searching for ways to gain an edge, and while great content is essential, producing new shows has become more difficult than ever with lockdowns across the world. That’s why many services are concentrating more on their products, designing highly strategic roadmaps to ensure a better offering than competitors— to acquire and retain as many viewers as possible. That’s led to a certain debate among OTT decisionmakers: should we prioritize our CTV or mobile platform?

Many providers feel CTV takes precedence, because they believe that their consumers only want to watch long-form content on the big screen. What consumers actually want is to be able to watch at any moment, on the screen of most convenience. CTV is certainly critical, especially for ad-supported businesses trying to lure buyers away from cable TV. But mobile is also playing a critical role that cannot be neglected, with a growing audience, use cases that are key to viewer satisfaction, and a role as the platform more and more consumers are using to create accounts with new services. The OTT services that neglect mobile are missing a huge opportunity, and giving a gift to YouTube, which already enjoys incredible success with its mobile video app.

Measuring success on CTV vs. mobile

Research shows that in many markets CTV’s account for more viewing hours of streaming video then other platforms. Yet a recent NPAW report shows that there are more plays (or sessions) happening on smartphones and tablets. Those sessions are, on average, shorter than CTV sessions, and session length is important. But, it's only one of many metrics. Reach and frequency are also valid ways to measure OTT success, and mobile exceeds CTV on both counts.  

Even though a smaller fraction of time spent viewing OTT video is on mobile, a higher percentage of the times viewers hit play are on a mobile device. This is significant because some of the most frustrating viewing issues happen when you press the play button on a mobile device: startup delays, buffering, poor quality. So even when less time is spent in the app, there are a high number of mobile touchpoints with viewers—and a high number of opportunities to have their perception of your service undermined.

You might think that more time is spent with CTV than phones and tablets because mobile viewers are on the go and only want to watch short content, but that’s not the case. According to YouTube data, 3 in 4 adults watch YouTube on mobile while at home. Shorter mobile sessions are likely caused by poor experiences. Even at home, mobile video is more fraught with issues due to poor connectivity, which leads to higher rates of stream abandonment. In fact, poor video experiences can reduce view time by 30%. So it’s likely that improving the performance of mobile OTT videos would mean those mobile viewers at home and on the go would keep watching longer.

Why YouTube gets mobile video right

YouTube seems to understand this potential to engage mobile viewers. In fact, 59% of viewing time on the service happens on mobile (Conviva). While historically, the platform has been known for short-form user-generated content, these days the most popular content on YouTube comes from professional producers. As a result, the average video length is growing, and popular creators now regularly put out content between 20 and 60 minutes long. This is, of course, because of the site’s ad-based model. The longer you spend watching a creator’s new video, the more ads you’ll see, and the more money they’ll make.

But it adds a new perspective to YouTube’s mobile success. The days of 30-second cat videos are long gone, so length cannot solely account for it. It may be in part because YouTube’s audience trends younger, and younger viewers are watching more video on their phones. However, there’s another explanation: YouTube consistently updates and improves its iOS and Android apps, adding new features and improving the user interface, which has resulted in a fantastic mobile platform.

Other OTTs may not have this same level of success on mobile, but that’s not because their viewers don’t care about mobile. Some may even take Quibi’s epic failure as an indication that viewers overall don’t care. Yet there are plenty of explanations that could explain Quibi’s demise (it’s content was almost universally panned by critics, for example).

Instead, those OTTs that ignore mobile because they don’t get as much mobile viewership are creating a self-fulfilling prophecy: if an OTT doesn’t invest in a great mobile experience, it’s users won’t be as likely to choose them when they’re watching on mobile. Even though they may not consider YouTube a direct competitor, OTTs that don’t prioritize mobile are essentially conceding their share of mobile screen time to YouTube.

Viewers are watching your content on many devices on any given day and at too many companies, mobile has taken a backseat to CTV. Mobile is not only a popular way to watch, it’s also the front door to your service: more people are signing up for services on their mobile device before ever logging in on their CTV. Plus, mobile has higher reach, with 85% of viewers watching on a smartphone in Q1 2020 (compared to 49% who watched on other internet connected devices, according to Nielsen). To both gain and retain an engaged audience, and keep your ground in the streaming wars, it’s important to have a strategy that takes a cross-platform approach and ensures a great experience on any screen your viewers watch.

Penthera is a global software company that develops and deploys products to help OTT providers improve the mobile video experience and drive business results.

Gamut, the advanced advertising company acquired by Apollo Global Management when it bought Cox Media Group, said it will use iSpot.tv to measure TV ad campaigns.

Gamut said it will use iSpot's cross-platform TV data, which unifies both traditional and over-the top viewing, to document the incremental reach of the local OTT campaigns Gamut sells. 

As OTT and connected TV usage has increased during the pandemic, advertisers have been looking to reach streaming viewers, but have been demanding better measurement of campaigns, including data about whether streaming ads are reaching viewers who have cut the cord or aren't watching traditional TV.

With iSpot, Gamut can target and reach qualified local OTT audiences, which generate website visits, foot traffic, brand lift and co-viewing at scale for clients.

"Marketers today have many options with regards to how they spend their ad dollars. As OTT continues to grow at an incredible pace, we are now able to provide our advertisers with the data that they need to measure the true incremental reach of their OTT campaigns,” said Soo Jin Oh, co-COO at Gamut.

Gamut started selling local OTT campaigns three years ago when few were in the field. It created Gamut Total by making deals with premium video providers that give it priority access to inventory not typically available to programmatic buyers.

Though Gamut is related to Cox Media Group, it sells local campaigns in all 210 markets, not just those where CMG owns stations.

Oh said the iSpot data will help Gamut distinguish itself from other OTT companies.

“We chose iSpot because we play in the local space and a lot of competing solutions using ACR technology were built for national. A lot of them don’t have the scale to do small markets,” she said. 

“Unified measurement in and of itself is super innovative,” said Stuart Schwartzapfel, senior VP, media partnerships at iSpot.TV. “We’re doing this at great scale and we’re doing it in a very precise manner that meets the needs of Gamut’s regional and local advertisers.”

Having better data will help marketers decide how much money they ought to be spending on OTT. It will also help track and reduce the frequency with which viewers see some individual ads, improving the consumer experience.

“Data is only powerful if it’s actionable,” Oh added. With some data companies, a report costs five figures and isn’t delivered until after a campaign has run. “When you’re working with iSpot, it’s real time,” she said. The data is part of the Gamut dashboard as value added.

The local OTT is also a good fit for political advertisers and this is going to be a record setting year for campaign spending. “Political is a big business. We’re fortunate to be seeing that right now,” said Oh.

Gamut is integrating the iSpot data into its tech stack and the dashboard clients use to monitor tier campaigns. “We’re already integrated with MediaOcean, Strata, HudsonMX. Prisma is coming up soon,” she said, ticking off the major buying platforms.

“We want to make buying Gamut a very easy process,” Oh said. “That’s the key when you’re playing in the local space, which can be cumbersome."

Gamut also wants to add more outcome data to its platform.

Finally it wants to take the data it has already accumulated and make it ready to be used by artificial intelligence and machine learning to predict consumer behavior.

How much content is too much content? Research shows that the average U.S. adult takes 7.4 minutes to make a selection on over-the-top services. According to further research, the average U.S. household has three streaming services and 70% of survey respondents agreed that they often struggle to figure out what to watch next. So, it’s not so surprising that 21% of all viewers decide to give up and not watch anything at all. 

How can providers put an end to endless scrolling and provide accurate recommendations that put relevant content in front of viewers, so all they have to do is press play? It has to be a two-way street.

While OTT providers can make greater strides to using accurate metadata to give the algorithm and recommendation engine the best information to work with, viewers also need to reconsider how much they’re willing to share with providers in order to get the accurate recommendations they’re looking for. 

There was a time when U.S. viewers had very limited TV channels to choose from: the “Big Three,” CBS, NBC and ABC, dominated broadcasting and decisions on what to watch came from the radio, newspapers or magazines. From this, viewers were given the ability to record programs, first on a VCR and subsequently a DVR, and then watch them at any time, creating far more choice.

Navigating Peak Content

This vast library of content that suddenly became available quickly presented another challenge: How could this new volume of choice be made easier for viewers to navigate? It was clearly time for operators to address this, but with so much content to present on either a TV screen or a mobile device, this was no easy task. 

One way to solve this was through introducing algorithms that, when based on a set of rules, could determine which content to present to viewers. For example, if one viewer had watched a film with a certain actor, the algorithm could determine that they might also like other films or TV shows featuring that actor. However, this is not a sophisticated or accurate method of recommending content. 

These algorithms have the ability to increase their accuracy by adding more rules, but this model still makes a lot of assumptions. In fact, in 2009 Netflix awarded a $1 million prize to a developer team for an algorithm that increased the accuracy of the company's recommendation engine by just 10%. Technology has moved along a lot in 11 years, but the challenge remains the same. 

Furthermore, this only gets more complex when subscription credentials are shared between family or friends. One-third of U.S. subscribers admit sharing their streaming service subscriptions with one to two other people, and more than a quarter of subscribers with three to four people. 

While a recommendation engine can form patterns between content watched at certain times of day — for example, cartoons between 4 p.m. and 6 p.m. — when the lines get blurred and cartoons are watched at different times of the day, and suddenly cooking shows are watched at 4 p.m., there is only a degree of intelligence that the engine can refer to. 

These algorithms and rules have little potential to create the experience viewers crave without rich metadata behind them. The deeper and richer that metadata can be, the more chance the recommendation engine will have of finding a piece of content that the user will want to watch. However, to surface a sufficient recommendation, users also have to be willing to give a little something back.

It’s predicted that by 2023, there will be 257 million U.S. social media users. In this current age, consumers share everything about themselves on social media. But when it comes to sharing data or information with a TV provider, data capture suddenly becomes out of the question. A 2019 survey of U.S. consumers showed found respondents are less likely to share personal data than they were the year before. 

Yet these are the same consumers that seek these personalized recommendations. If consumers want to be able to discover content more easily, they must be prepared to share personal information with their TV provider. It’s a two-way street; the provider needs to be able to use viewing history to suggest new programs or films line with a viewer’s tastes. But in order to do this, the operator needs to be able to convince the viewer that they will get a better experience as a result.

A Time-Consuming Chore

There is only so much content that can be presented on a TV or mobile screen, and if that content isn’t what the user is looking for, then searching behind the scenes for something more relevant can be a very long process. 

When a program possibility is found and if the short trailer isn’t enough, the viewer could then commit to as much as an hour spent finding out if they like the program or film. That’s a big ask. By giving the user more of a snapshot of what they’re about to watch, or creating shorter form content like recently launched Quibi, users can spend less time scrolling and more time watching content to decide if it’s a good fit. 

There are multiple ways to fix the content discovery conundrum, but one thing will make a big difference: confidence. 

Confidence must come from the viewers that the operators are doing their best to give them accurate recommendations and they must trust they are using their data in the right way. Operators must have confidence in the quality of the metadata behind the algorithms to ensure that quality recommendations will be given as a result. λ

BAMTech Media, the technology services and video streaming operation spun out of MLBAM, quietly launched a corporate web site last week as the company pushes toward a bigger deal with The Walt Disney Company that will center on an array of new direct-to-consumer OTT offerings.

BamTECH also has its own logo, as well as presences on a set of social media channels – Twitter (@bamtechmedia), Facebook and LinkedIn.

Dan Rayburn, EVP of StreamingMedia.com and a principal analyst at Frost & Sullivan, caught wind of the web site launch last week:

BAMTECH Media launches their new website: https://t.co/WRxIyDZYh9  Disney deal still working through closing. pic.twitter.com/SrQwmLVzbH

— Dan Rayburn (@DanRayburn) September 21, 2017

The presence on the web comes as Disney looks to pay $1.58 billion for an additional 42% stake in BAMTech, following an earlier deal that netted Disney a 33% stake in the OTT specialist, which is now led by CEO Michael Paull.

RELATED: Feds OK Disney’s BAMTech Buy

The BAMTech site offers the typical kind of details and background one would expect, while also listing some stats that speak to the scalability of its platform, noting that in 2016 the company streamed 50,000-plus live events and 100,000-plus hours of content. It also touts having the capacity for more than 450 live simultaneous events, underpinned by TOCs in New York, San Francisco and Amsterdam and datacenters on six continents.

And BAMTech is looking to grow rapidly, based on its dozens of open positions, including several broadcast infrastructure engineering slots, director/VP of business development and content acquisition, Android and Apple platforms engineers, director or eSports marketing, VP of growth/user acquisition, Minor League Baseball Cutter (part-time), senior product manager of Ad Tech, and UX/product designer, to name but just a few.

Cinedigm said it is working with Party Crashers Media to launch a progressive news channel that will be distributed over the top and be ad supported.

The Party Crashers Channel is expected to launch after the election in the first quarter of 2021. Cinedigm will distribute the channel on 60 of its partners, including Vizio, Samsung, Xumo and Fox--owned Tubi.

Party Crashers Media is led by Sue-ling Braun and Jamie McGurk.

“The enormous group of ‘cord-cutters’ and ‘cord-nevers’ in the under-50 demographic does not see their needs met by cable news and legacy media,” they said. “They are seeking alternative, independent media but there has been no real centralized forum in which to discuss these issues from a progressive viewpoint. The Party Crashers Channel will provide that outlet. We will be the go-to location for those bringing new ideas and new solutions to today’s issues. Progressives, particularly GenZ and Millennials, are united in their vision of a more humane and egalitarian world and we will showcase that sensibility in our programming and across our channel.”

Programming on the channel will include The Sanders Institute, The Majority Report (featuring Sam Seder), The Benjamin Dixon Show The Nomiki Show (with Nomiki Konst), The Humanist Report (Mike Figueredo), David Doel’s The Rational National, TBTV (from Tim Black), Status Coup starring (Jordan Chariton & Jenn Dize), and The Katie Halper Show.

After it launches the Party Crashers Channel plans to produce a select slate of original programming. including a flagship daily news panel featuring diverse hosts and guests from across the political spectrum, edgy late-night talk and comedy, as well as a slate of lifestyle, pop culture and entertainment series.

Braun is an independent filmmaker and creative director with clientele including artists, political organizations, candidates, and major brands. She held creative leadership roles at MTV/ VH1, Upworthy and BuzzFeed.

McGurk, current Co-Chair of Courage California (formerly Courage Campaign, an online community with over one million members), has worked at the intersection of politics and media from the start of her career at Benton & Bowles Advertising and later through her companies Off Balance Productions and SeaChange Communications, as well as OTX Research

“Both Sue-Ling Braun and Jamie McGurk are lifelong political activists with a deep commitment to making the world a better place,” said Tony Huidor, general manager of Cinedigm Digital Networks. “We are thrilled to bring The Party Crashers Channel to a political arena in dire need of a fresh, independent political perspective.”

Newsmax Media, which had argued that Charter had jumped the procedural gun in seeking to have two of its Time Warner Cable merger conditions sunset early, went beyond procedure last week to tell the FCC the early sunset would hurt his business. 

That is according to a conversation between Newsmax CEO Chris Ruddy and FCC commissioner Jessica Rosenworcel, according to an ex parte filing. Ruddy's focus was again the alleged procedural deficiency. 

Related: Newsmax Says FCC Jumped Gun on Charter Petition 

Charter in June asked the FCC to terminate the seven-year ”no data caps or usage-based pricing“ condition as well as the interconnection condition on its 2016 deal to acquire Time Warner Cable and Bright House Networks. They want the conditions to sunset on May 18, 2021, two years early — in light of the ”dramatic“ changes in the online video marketplace.  

When it imposed the conditions, the FCC said they were to ensure Charter could not “hamper or prevent its current and future online video rivals from expanding, becoming more competitive, or starting up in the first place.” Charter suggests those rivals hardly need protection from the company given that its rival internet-service providers have not had similar conditions and the OTT marketplace has flourished. 

"Mr. Ruddy explained that Newsmax relies on an over-the top-streaming video feed of Newsmax TV to reach Charter subscribers whom it does not reach via traditional linear video packaging," the filing recounted. "As a result, sunsetting the data cap and interconnection conditions will harm Newsmax’s ability to reach viewers and provide Charter with enhanced gatekeeping power." 

Ruddy also said Charter should not have been allowed to introduce new economic info in its reply comments saying that was new material that should have been part of the initial petition. He said the public should get to comment on that new economic declaration. 

We've reached the inflection point with OTT adoption and things are likely to get even wackier in television buying. Forecasting for traditional television will have close to no accuracy this fall given the change in viewership behavior and programming challenges. There will be a huge opportunity in the scatter market for the savvy buyer. 

As advertisers continue to scramble with media spend in the face of the pandemic, I’ll spare you the “unprecedented times” bit and cut right to the chase: we are living in downright wild times for media buying. Current events have accelerated the adoption of OTT viewership and brought it to equal footing with linear television viewing in record time. According to our data, linear TV saw a significant increase in late March, since leveling off, while OTT spiked twice as much in the same period and remains at a 15% increase as we dive into summer. 

Only a few months ago, media agencies saw this share shift as a fairly distant future state. Many had just started thinking about how to organize and reposition for this type of change in audience behavior. Cut to summer 2020 and this radical change has taken full effect -- whether agencies, publishers or advertisers were ready for it or not. 

While many things are still unclear, one thing is apparent: the most reliable and impactful reach medium we have ever seen in television is moving to OTT environments, where ad load is relatively restricted compared to traditional linear television. It’s also clear that this is happening faster than we, as an industry, are prepared for. It’s a lot to digest, but it’s not all doom and gloom. Let’s explore what this means for the industry and how forward-looking teams can actually take advantage. 

Guarantees based on audience are the future

Media companies and publishers that can offer guaranteed audiences on OTT will win share of wallet. What’s the value of a guarantee in 2020? Close to nothing in linear given how much the TV schedule can change on a dime. Take live events and sports for example, we’re already seeing there are no promises in the comeback of sports as the MLB season, and other leagues, get off to a rocky start. Smart advertisers should already be looking to OTT live, OTT AVOD and digital online video (OLV) as their guaranteed reach channel. Leveraging linear will come in as a way to drive additional reach performance via cost-effective CPMs. Guarantees based on audiences make more sense in digital and OTT where there is sustained viewership behavior and the flexibility to deliver ads where the viewers are. 

Focus on cross-screen is key 

We’re already seeing OTT CPM rates exceed effective CPM rates on linear. According to our data, average linear CPMs are down 17% from last summer. Because we have hit this inflection point earlier than the industry was prepared for, there is a huge opportunity for advertisers who have already embraced cross-screen capabilities, along with aligning their agency teams accordingly. These teams are likely to outperform all others this fall as scatter buying in linear becomes the most effective way to gain reach and performance for campaign delivery. While we have historically looked to digital for incremental reach, this fall, we’ll be looking to linear for that same objective. Upfront guarantees have become more rare and viewership behavior, or in buying terms, “ratings points,” will be unpredictable. For the moment, there is no incentive to buy on a linear guarantee unless the rates drop significantly -- which may actually already be happening.  

Opportunity comes to those who wait

Scatter buying on linear will inevitably be where all the action is. Advertisers and media agencies that have turned to solutions like OpenAP will benefit in the wild west that awaits as the summer days dwindle. The ability for advertisers to execute scatter buys without the typical negotiation time frames for linear will be vital to taking advertising dollars off the table for broadcast publishers. Broadcasters that have engaged or invested early in technology to do this are in a great position. The supply side is definitely faced with opportunity, but resource constraints are something to consider as automation in linear is lacking. This fall will be a time when flexibility and automation are most vital to linear buys, a change in the industry that players need to adapt to in order to survive.

I’ll say it again, it is not all doom and gloom. For teams that embrace the future, these coming months could mean a lot of new opportunity and success in their strategies and investments. There’s no turning back now, though, TV viewership will likely never look as it once did -- which is admittedly both exciting and a bit scary. Question is, are you ready?

VideoAmp is a software and data platform that specializes in the measurement and optimization of media investments across linear TV, OTT, digital and walled gardens.

After falling from peak levels in March when people started staying home to slow the spread of the coronavirus, time spent with over-the-top video bounced back in July, according to Adobe.

While video starts are still down 2% (following an 11% dip in June), time spent is back up to March levels, rising 28%.

Adobe said the drop in video start indicates that after months of searching for something to watch, there is less content surfing and fewer viewers who are new to streaming.

Video completion trends are better. Completion rates began a steady decline in early 2019, as consumers were flush with a growing array of services and original content. By the start of the year, completion rates were still down. Adobe said rates began to go up in April and that has continued into July, when they were up 11% from a year ago.

“In a single sitting, 63% of consumers say that they always/often finish a piece of video content from start to finish," Adobe said. 

Since the COVID-19 shelter-in-place orders, mobile use has been growing for shopping applications, but video consumption of non user generated content is not growing on mobile. In fact, in July use of mobile was down 10% and usage on desktops was down 18% while OTT video rose 116%.

Looking at video time spent paints a similar story. OTT is the primary growth driver, with significant peaks in months like April. 

Time spent on mobile has been in decline for the last three months (May-July). And desktop has not been a growth driver either. 

Consumers find they have too many streaming options, and it is becoming overwhelming, Adobe found. 

In a survey of over 1,000 people: 40% felt there were too many apps and services to stream video, and that it was difficult to manage (29% did not agree; 31% were neutral). 60% reported having 1 to 3 services, while 35% had between 4 to 7. Around 6% had more than 8. 

Since March, 54% reported not purchasing any new subscriptions or services.