Black viewers have always been at the forefront of new media consumption, and the emerging free ad-supported streaming television (FAST) environment is no exception. 

As more Black viewers tune into FAST channels, though, industry observers are concerned the platform won’t keep up with an increasing demand for content that reflects the images and stories of that audience segment across all platforms. That’s because big media companies are gobbling up bandwidth by launching multiple channels based on their owned-and-operated networks and popular shows. A perception holds that independently-owned multicultural programmers might get stuck on the outside looking in.

Much as Black viewers have traditionally consumed more content on linear and streaming platforms than the total viewing audience — Black viewers watched TV an averaged of 44.32 hours a week compared to 32.18 hours for the general population during Q2 2023, according to Nielsen — but they’re also more likely to watch content from FAST services than viewers overall. Some 52% of Black viewers tune into a FAST service every month, compared to 45% of total market users, according to the 2023 Horowitz Research study “FOCUS Black: State of Media, Entertainment & Tech: Viewing Behaviors.”

Only subscription video-on-demand services like Netflix and Hulu topped FAST usage among Black consumers, Horowitz reported.

“Black viewers are among the most valuable for media brands because historically they are much more likely to spend more time with media and entertainment,” Horowitz Research executive VP of insights and strategy Adrianna Waterston said. “We’re seeing a continued pattern of how valuable Black consumers are to this space. That continues to be true even in this new ecosystem that now includes FAST.”

The survey of 643 Black TV viewers 18 years and older, conducted last February, also reports that older and younger Black adults use FAST platforms almost equally. Fifty-one percent of Black adults 18-34 viewed a FAST channel at least once a month, compared to 59% of adults 25-54 and 48% of adults older than 50. Comparatively, 88% of Black adults 18-34 used a streaming service, compared to only 65% of adults over 50.

The uniqueness of FAST channels, which offer a myriad of programming choices, similar to SVOD, but provide the lean-back viewing experience of traditional cable or broadcast TV, is quickly capturing the attention of African Americans. 

“Television has always been about being live and ad-supported, but when streaming came it changed behaviors,” Waterston said. “But at the end of the day, we forget that television isn’t supposed to be work. It’s supposed to be entertainment, and people are getting very frustrated with the cost of streaming services.”

With streamers such as Netflix continuing to raise monthly subscription fees, the relatively inexpensive cost of accessing FAST content — free, aside from the price of a smart TV and a high-speed internet connection — makes such services appealing to Black viewers, observers said.

“You can get many FAST channels and [streaming content] apps without having to have a cable subscription,” Douglas Holloway, a cable-industry veteran and longtime senior executive at NBCUniversal, said. “In this recessionary time, you can get a relatively inexpensive smart TV with, in most cases, hundreds of FAST channels already embedded in the operating system of those sets.”

Paramount senior VP, global streaming research and insights Christian Kurz also said Pluto TV’s lean-back viewing experience — synonymous with traditional linear TV — appeals to Black audiences. “What we’re seeing is that for the Black audience, the comfort and ease of watching television is more important than for everyone else,” he said. “You don’t need to register, you don’t need to pick any show and it’s very easy to navigate.”

Pluto TV and Tubi are the two FAST services Black viewers watch most, with use within the demographic overindexing against the general market, according to Horowitz’s survey. The two services succeed by effectively curating content targeted to Black audiences, Waterston said.

Kurz pointed to the programming offered by Paramount-owned Pluto TV, with channels featuring familiar and entertaining content such as classic Black-focused movies and TV shows and branded channels from such cable networks as BET, Bounce and Aspire TV.  

“We believe that our overall content mix is absolutely leaning into that familiar nature and into that easy viewing and positive content that Black audiences are looking for and craving,” Kurz said. “We are trying to engage with audiences of all forms, shapes and sizes, and this audience is certainly one that we’ve been working on.”  

Even as FAST services grow in popularity among Black audiences, there’s still a paucity of services targeted specifically to the demographic. FAST channels targeted to Black audiences make up just 2% of all such channels in the U.S. at a time when Blacks represent 14% of the U.S. population, according to Ebony TV, a FAST channel venture between Ebony Media Group and Lionsgate that launched this past October and is available on Fox Corp.-owned Tubi. 

Other independent Black-targeted entertainment brands, such as Revolt TV and TV One, are also featured on Tubi’s live FAST TV lineup. TV One’s move into the FAST space in 2023 with the launch of its Crime & Justice channel reaches the target audience where they are. 

“We have some franchises that are extremely popular with the TV One audience, and luckily, we’re now at a point where we can make that available to people who are outside the pay ecosystem without cannibalizing the [linear] business,” Rori Peters, senior VP of content distribution & marketing at TV One & Cleo TV, said. 

Shelf-Space Worries 

As media companies turn to FAST channels to generate additional streaming revenue from their existing linear networks and shows, Horowitz’s Waterston is concerned that bandwidth issues will eventually shut independent, multicultural content out of the platform. 

“I think the strategy that media brands are using to try to use FAST to drive engagement with their premium services is a smart one because then at least you’re keeping the viewers in your ecosystem,” Waterston said. “What remains to be seen is whether the FAST space will have room for independent, new emerging media companies trying to make a name for themselves and build an audience, or whether they’re going to get edged out by the big media conglomerates that have discovered this space.”

Another looming issue in the development of diverse FAST channels is access to bandwidth. Former NBCU executive Holloway runs a pair of ad-supported streamers in UKW Media and Urbn-TV.  

“Ultimately it comes down to bandwidth allocation and the cost of developing a FAST channel, which is fairly expensive,” Holloway said. 

While Pluto’s Kurz acknowledges that there is an “upper limit” of live, linear content that the distributor is keeping an eye on, it is still being aggressive in launching content that will bring in a broad cross-section of viewers.

“We’re always on the lookout for the right opportunities to broaden the appeal of the overall service,” he said. “It’s not just all content, but it’s about content that we also think is going to work for our viewers.” 

Consulting firm Magid offered predictions for the entertainment industry, and streaming in particular, in 2024. It predicted increased churn among the major streamers as FAST channels proliferate and the monthly price for a subscription to a premium streaming network goes up. 

“Players large and small will experience turbulent churn seas ahead unless they develop strategies to manage churn with precision,” Magid said. 

Magid shared its findings in an online presentation December 11. The firm broke subscribers into six different groups. The group known as Hypers are a high-churn, high-income segment that accounts for almost one-third of new subscribers on average in any given month. While they often split from an existing service, they are also “hitmakers, social amplifiers and organic marketers that carry more services (six) than the average home (3.3),” Magid said. 

The rise of ad-supported video-on-demand (AVOD) services will prompt subscription video players to “concentrate their investments on what AVOD doesn’t do as well — forcing a shift in strategy.” AVOD excels in news, kids programming, family programming and reality content, Magid said, and so SVODs will have to do a better job delivering and marketing premium content. 

“The result will be SVODs that look and feel more akin to the HBO of old, turning to, for example, expensive dramas and movies off-net in their first run outside of theatrical and sports rights, as a way of differentiating their service when it comes to quality content,” Magid said. 

Tony Cardinale, Magid senior VP, data and science, global media and entertainment, said the SVOD players, paradoxically, will spend less on programming. “They’ll find ways to do it more efficiently,” he said. 

Magid also sees a rise in the bundling of channels. “Consumers will be recreating the bundle that they had via cable 15 years ago but with a different assortment of assets, tied together synergistically through creative partnerships,” the firm said, calling for networks to be open-minded about partnering with rivals. 

“Those who have been competitive in the past will have to put their emotions aside and play nice in the sandbox by partnering strategically,“ Magid said. “Ultimately, services will have to marry each other in order to stabilize their businesses and establish a sustainable business model.”  

One subscription and one access point will make life easier for consumers. 

Magid also predicted that sharper marketing in the streaming universe will rule in the new year. “In 2024, there will be a move towards precision marketing as messaging to the right audience about the right shows will be key to streaming success,” the consultancy said. “Marketers’ decisions around spend, especially when it comes to hidden gems, will take on new importance as streamers attempt to identify who's watching and why and work to attract brand advocates who will tout the value of their service.”

A new overview report on U.S. streaming (OTT) and pay TV trends highlights continued but slowing growth in streaming revenue, in an analysis of 50-plus providers (80 services) led by Netflix, Disney (including Hulu), Warner Bros. Discovery and Amazon. 

Convergence Research puts out yearly reports called The Battle for the American Couch Potato (here's our look at last year's highlights). This report said  programmers and independents will continue to essentially split U.S. OTT access (subscriber) revenue. In 2022, U.S. OTT access revenue grew 26% to $49.6 billion, with a forecast of 21% growth in 2023 and a 13% bump in 2025. 

Programmers, though, are facing more competition for views and profits and also balancing their pay-TV and streaming businesses along with advertising and theatrical distribution concerns. Growth will be slower in terms of household penetration, subscriptions per household and net OTT subscriptions, at a rate from 2023 to 2025 that's half of the growth from 2020 to 2022. Streamers have been tweaking the subscription offerings in response (and currently are running some deep discounts).

In terms of subscriber growth of streamer accounts, the 2022 estimated growth of 57 million (down from 90 million in 2021) should slow to 45 million added in 2023, 37 million in 2024 and 31 million in 2025, Convergence said. Analyst Brahm Eiley said in an email: "Turbulence for the Networks/Studios is only going to increase going forward as they see less revenue from traditional TV advertising and programming sales and less incremental OTT subscriber additions. Hence there will be continuing pressure on the Networks/Studios to raise streaming subscription prices, add more advertising and keep costs (programming and headcount) contained.”

On the pay TV side of things, Convergence estimated 2022 U.S. cable, satellite and telco TV access revenue declined 6% to $85.8 billion in 2022 and said a 9% decline is in the cards for 2023 (though with average revenue per unit growth of 3%) and a 13% dip will occur in 2025. 

In 2022, the report said, U.S. pay TV subscribers declined by 7.37 million (11%) in 2022 and another dip of 8.44 million (14%) is foreseen for 2023. A 16% decline is projected for 2025. As of year-end 2022, almost 70 million U.S. households (over 53% of households) did not have a TV subscription via cable, satellite or telco. Traditional TV access is well into becoming a niche product, Eiley said. 

Broadband continues to grow in subscribers (3.2 million) and revenue (6.5% to $84.8 billion) in the U.S. in 2022, the report said. Higher subscriber additions are forecast for 2023 and slightly lower revenue growth. Cable continues to maintain the lions’ share of residential broadband subscribers but cable’s annual share of net additions has fallen precipitously, a trendline projected to continue through 2025 due primarily to T-Mobile and Verizon. [Fixed wireless access accounted for 95% of home broadband growth in Q1 of 2023, Next TV has reported.]

Sales of global smart TVs, weakened as the supply of LCD panels has been hit hard by pandemic-related supply issues, should rise by nearly 2% this year, according to Kagan, a media research unit of S&P Global Market Intelligence.

The return of LCD supplies, coupled with increases in residential broadband penetration which Kagan claims has opened the addressable smart TV market, should add to growth.

In a research note, Kagan said global smart TV shipments should rise 1.9% by the end of this year to 153 million units. The researcher forecasts that compound annual growth rates (CAGR) for smart TVs should increase to 2.3% from 2021 to 2026.

Also: Inflation Pushes 2022 Streaming Device Shipments Down, Kagan Says

“Despite a weak first quarter for global smart TV shipments, declining panel prices and the coming World Cup in November 2022 are expected to overcome the negative effects of inflation to spark consumer demand by the end of 2022,” Kagan said in its report, adding that while supply issues remain for some LCD panel components, the overall supply for TV displays is improving.

Cable operators and their hybrid-fiber coax (HFC) internet access approach will continue to be the dominant fixed broadband delivery system with a 65% share of the residential market in 2027, predicts analytics firm GlobalData.

Cable’s position will be helped by all that government subsidy money in programs like the Broadband Equity, Access, and Deployment (BEAD) effort overseen by the National Telecommunications & Information Administration, which has more than $40 billion in broadband subsidies to give out. Then there are the Federal Communications Commission’s Universal Service Fund billions and the COVID-19-related money that agency is overseeing.

In its latest report, United States Fixed Communications Forecast, GlobalData also predicts the residential broadband market will grow from $84.5 billion in 2022 to over $102 billion in 2027, but not with much help from satellite broadband efforts like Elon Musk’s Starlink.

While cable operators will lose some market share over that span due to competition from telco fiber overbuilds, GlobalData predicts cable will hang on to the prime position due to improved HFC.

Fixed wireless is a growing success story, the company said, but it is still expected to represent less than 10% of the market by 2027.

As for the low-earth-orbit satellite fixed wireless services from Starlink and OneWeb, GlobalData predicts they will hardly make a dent in the market at less than 1% share in 2027. ▪️

The penetration of streaming in U.S. households has expanded to 80% in the first quarter from 79% in the fourth quarter of last year, according to a new report from MoffettNathanson analyst Michael Nathanson.

A year ago, in the first quarter of 2021, streaming penetration was 74%, according to data Nathanson uses from a monthly survey by HarrisX.

Nathanson said the growth in penetration came because of increases in subscriptions to newer, smaller services like Peacock and Paramount Plus, while OG streamers like Netflix, Hulu, Disney Plus and Amazon Prime Video were relatively flat as a group.

In the quarter those established services appeared to step down the increase in new episodes of original programming. By contrast, newer services are ramping up with new series on Paramount Plus and the Olympics and Super Bowl on Peacock. 

Peacock’s penetration was up 235 basis points quarter over quarter. Paramount Plus’s penetration increased 350 basis points quarter over quarter, while HBO Max was up 185 basis points.

Discovery Plus’s growth wasn’t exceptional, but its subscribers’ daily usage was a month the highest in the industry, trailing only Netflix and Hulu. 

The increase in streaming penetration came from consumers who don’t have a pay TV subscription. Penetration in homes that do have a pay TV subscription was flat.

Nathanson said the shift to streaming will continue to be a problem for legacy media.

“We see a problem brewing in the data,” Nathanson said. “When asked why consumers cut the cord and moved to streaming, the issue of ‘Pay TV being too expensive’ may be quickly bypassed by the rationale that ‘all the shows I currently watch are on streaming.‘ 

“As more linear network owners (e.g., Disney, Comcast, Paramount and now Warner Bros. Discovery) shift more and more original content to their streaming services they are potentially creating a ‘tragedy of the commons’ moment when all these individual actions end up collectively damaging a common good — in this case, the linear TV bundle,” he said. ■

Telecom broadband operators said the idea that Europe’s tougher broadband privacy regulations translate to a better consumer experience — and that the United States should follow that model — is a myth, and the European Union could actually go to school on the U.S. pro-investment strategy.

According to a new report, US vs EU Broadband Trends (2012-2020), the U.S. continues to top Europe in broadband adoption, deployment, investment and competition.

The report was prepared for USTelecom by business analytics firm BPI-Telcodata.

Acording to the report, U.S. consumers can now choose among twice as many facilities-based competitors as their EU counterparts.In rural areas, it‘s more than seven times that of Europe.

The report also said the U.S. leads in both deployment and adoption of high-speed broadband, defined as speeds of at least 30 Megabits per second to 100 Mbps downstream.

The U.S. lead in adoption is likely driven in part by the fact that prices are stable and even declining despite rising costs for most essential goods, the report said.

That was a theme among Republicans at an FCC oversight hearing, where numerous legislators said the price had been going down, countering the Biden administration‘s argument that broadband prices are too high and that that is the reason that price needs to be part of the definition of broadband availability.

But rather than needing to emulate Europe, USTelecom president and CEO Jonathan Spalter suggested the U.S. regulatory model — one that prizes “vigorous private investment” — “is a lesson for the world in spurring investment, advancing competition and accelerating broadband’s many benefits to people everywhere.” ■

A new report from Accenture said consumers are complaining about streaming getting to be more like cable and, ironically, that cable operators are among the potential aggregators that could solve some of the issues facing the industry.

According to Accenture’s survey, consumers feel they’re paying a lot for content they never watch and they’re not interested in — something they used to say about cable. When consumers were asked what percentage of content provided by five major streaming services is relevant to them, no service topped 40%.

“That’s not far off from what we found consumers thought about the content they paid for from their cable providers a few years ago,” Accenture said in its report, titled Streaming’s Next Act.

The survey also found what Accenture called “a widening price-value mismatch in streaming.” The survey found that 63% of consumers say the entertainment subscriptions they want are too expensive. At the same time, 62% expected streaming entertainment would be cheaper because of Netflix’s once-low price. Now, they find, watching video is just as expensive as it’s always been.

Consumers don’t see things getting better, with 70% of those survey saying they expect streaming services to continue to raise prices.

Accenture points to three core issues consumers complain about that it says are eroding the consumer streaming experience.

Consumers gripe about frustrating “rabbit holes” in streaming services — inefficient, increasingly expensive bundles and scattered algorithms that make it hard to find programming they want to watch and that turn a pleasant evening in front of the tube into an expensive, unwieldy experience.

Navigation Frustrations

In its global survey, Accenture found that 60% of consumers said they consider navigating between different streaming services to find content “a little” to “very frustrating.” Half of those surveyed said they spend more than six minutes trying to find something to watch.

The more services a consumer sues, the more frustrated they get, with 65% of those with four or more services saying they’re frustrated, compared to 60% who use just one.

That makes search engines that search across multiple services attractive to 58% of those surveyed. 

The growing expense of streaming is also a problem, with 33% of consumers saying they will “somewhat” or “greatly” decrease their spending on subscriptions and one-time purchase in the next 12 months.

Just 34% of consumers said they were interested in adding new services, according to the survey.

Accenture also found that streaming service algorithms are working with incomplete viewing data, resulting in recommendations that can be wildly off base. 

Most consumers said they’d like their viewing profiles to work across services and that they would be OK with services knowing more about them in order to make recommendations more relevant.

Consumer suggestions for improving recommendations included letting them choose the genre they want to watch, basing recommendations on the popularity of content, their mood or what friends and family are watching.

Accenture suggests that streaming needs a smart aggregator that works across multiple platforms and gives consumers more control over the content they watch.

The media industry is aware of these issues, Accenture said. In its Technology Vision 2021 research, 77% of media executives said their companies need to dramatically re-engineer the experiences that bring technology and people together in a way that puts people first.

Accenture’s prescriptions involve finding apps and data-sharing agreements that work across streaming services and act as a single platform that enables viewers to watch what they want regardless of who is providing it. The system should also personalize navigation, curating the experience for each user.

Who will take on the role of aggregator? Accenture said it could be the subscription video-on-demand services, of course, or connected-TV device makers, internet on-ramps, consumer apps or even cable operators.

Compared to the numerous streaming services today, the number of successful aggregators will be small.

“Platform economics — and the simple challenges of discovery — likely will rapidly push the world toward a small number of aggregators that can achieve outsized financials through economies of scope and scale leverage,” Accenture said. ”The numbers will only work for business models that can extract attractive rents from partner apps, subscriber fees and premium CPMs while amortizing largely fixed operating costs across a bigger and bigger base.”

Seeing a Need to Bundle Up

Accenture expects mini-bundles to form in the short term. In the longer term, it will be tough for any streaming service to survive without being part of a major bundle.

So will the streaming business look like the cable business? 

“Perhaps, but it only achieves endgame equilibrium if the aggregators deliver on the promises of choice, personalization, and convenience,” Accenture said. 

“As aggregators battle to own the ‘Time Spent’ of consumers, we can expect future evolutions to aspire to be the on-ramps for any form of digital consumer experience. In fact, as Time Spent comes to include the limitless possibilities of the metaverse, aggregators, if trusted, can be enablers and caretakers of digital identity, entitlements, security, currency, and more. Indeed, the battle to be the home of a consumer’s streaming experience may, in fact, be just the first skirmish in the broader battle to be the home of a consumer’s every experience,” Accenture said.

Accenture surveyed 6,000 consumers in North America, South America, Europe, South Africa and Asia Pacific. ■

 MoffettNathanson LLC, the equities research firm founded by long-time media analysts Craig Moffett and Michael Nathanson, is in talks to be bought out by SVB Leerink, a unit of investment firm SVB Financial Group, according to a Bloomberg News report. The deal is said to be in the very early stages of development and could unravel.  

Moffett, a former media analyst at Bernstein Research, formed Moffett Research in May 2013,  and less than two months later added former Nomura Securities and Bernstein colleague Michael Nathanson to the masthead. The firm quickly established a reputation for insightful analysis in the media, communications and internet sectors and in 2018 expanded into the payments and processing space led by former Bernstein analyst and MoffettNathanson partner Lisa Ellis.

Buying MoffettNathanson would be a departure for SVB Leerink, which has focused on the healthcare industry in the past. But the firm has been expanding its horizons lately, hiring nine former UBS Group investment bankers in May to populate its newly former technology investment banking group. 

Moffett declined to comment. SVB did not immediately respond to a request for comment.

Smart TV owners have higher-than-average incomes and spend more on subscription VOD, but also watch ad-supported streaming programming.

A study conducted by Vizio and Magid found that 55% of U.S. smart TV owners — age 18-64 — watch ad-supported video-on-demand (AVOD) programming weekly. Only 39% of viewers who use cheaper devices watch AVOD programming.

Free ad-supported television channels are watched by 53% of smart TV owners, compared to 43% of nonowners.

The smart TV owners also spend $64 a month on SVOD subscriptions, more than the $46 non-smart TV owners spend.

Vizio and Magid said the findings make AVOD a good way to reach those higher-income smart TV households.

“These viewers have chosen streaming as their entertainment format of choice, and the smart connected TV as their medium to do so,” the report said. ”They’re not at all resistant to ads even when they have paid options that would allow them to avoid ads completely. In fact, they’re highly receptive to ad supported content, given the right circumstances.”

The report also notes that AVOD technology enables better ad targeting.

“As AVOD services deliver more relevant ads, viewers find them less intrusive and are therefore more likely to accept them,” the report said.

Magid conducted a quantitative online survey of over 1,600 U.S. streaming TV users aged 18-64, supported by a two-day online community qualitative study of both smart TV and peripheral owners.

No wonder legislators appear laser-focused on the power of social media these days. Use of social media giants Twitter and Facebook by politicians increased dramatically in 2020, according to a new Pew Research Center study of how Congress used both to engage with the public during and after the 2020 election, compared with 2016.

The analysis found that between Sept. 8 and Dec. 8, 2016, legislators had 207,009 posts on Facebook and Twitter combined, but that jumped to 315,818 such posts between Sept. 3 and Dec. 3, 2020.

Also Read: Pew: Sizable Portions of U.S. Use Social Media for News

Not surprisingly, Donald Trump was much on the minds, or at least in the feeds, of Democrats. In 2016, "Trump" was the second most common term used by Democrats and in 2020 it was the single most common word mentioned. By contrast, neither Hillary Clinton nor Joe Biden were among even the 10 most common terms for Republicans in 2016 and 2020, respectively.

Other takeaways from the analysis:

In terms of audience engagement, Democrats in 2016 received the largest increase when mentioning the possible election of Trump, while in 2020 Republicans received the biggest boost when saying that every legal vote should be counted or referencing Joe Biden's son, Hunter. For Democrats, “President-elect Trump” got the biggest engagement bump, followed by his strategist, “Steve Bannon.”

So-called link polarization is on the rise. The number of links to popular domains shared exclusively by members of one party or the other increased from 20 in 2016 to 31 in 2020.

Legislators are citing fewer outside links in their posts, driven by a sharp decline in Republicans linking to outside sources, down from 36% in 2016 to only 22% in 2020.

The Pew analysis is based on every Facebook post and tweet created by every voting member of the House and Senate, including official, campaign and personal accounts. That came to almost 166,000 Facebook posts from 698 members of Congress (a total of 1,408 Facebook accounts), and more than 357,000 tweets from 669 members of Congress (a total of 1,438 Twitter accounts).

Offering survey data as to which devices North American consumers are using to access popular OTT services, TiVo’s latest quarterly Video Trends Report indicates that combined, Roku and Amazon Fire TV streaming boxes, dongles and sticks account for around 30% of streaming usage.

TiVo’s first-quarter survey of 4,367 adult consumers in the U.S. and Canada is obscured by methodology — the company counts “smart TVs” as a separate device category from Roku and Fire TV accessories. And since Roku powers many smart TVs sold in the U.S., the picture gets a little blurry.

Further complicating things, TiVo breaks down consumer groups between “pay TV subscribers” and “broadband-only subscribers.” But some insight can be gleaned nonetheless.

Notably, smart TVs are used by around 30% of North American consumers to access OTT video. Among smart TVS, Samsung’s Wizen is the top operating system, powering 50.1% of devices. Google’s Android TV ranks second in the smart TV OS category, powering 14.1% of sets, followed by Roku (13%), LG’s WebOS (2%).

Mobile devices powered by Apple’s iOS and Google’s Android software are used for 16.3% of streaming usage, TiVo said. Gaming consoles (12.8%) and Apple TV devices (11%) are also popular choices.

For more stories like this, visit nexttv.com. 

Notably, Android TV doesn’t rank in the top five just yet. But that could change soon, with TiVo now marketing an Android TV-based OTT dongle, and Google set to release its own Android TV dongle, was well.

The usage data has relevance, given that WarnerMedia just launched its HBO Max streaming service without access to Roku and Fire TV. NBCUniversal’s Peacock is launching nationally July 15, and it hasn’t locked in device support for those operating systems, either. 

Media agency Dentsu Aegis Network said it will be using data from TVIsion as part of its Attention Economy initiative, which aims to compare attention across all media channels to improve the impact of advertising.

Dentsu’s agencies will utilize some aspects of TVision’s data, in parallel with proprietary insights tools, to plan TV/OTT campaigns based on attention metrics for the first time. 

“In a constantly evolving media landscape, attention is fast becoming an extremely valuable commodity,” said Clive Record, head of global partnerships for Dentsu. “Being able to properly measure it and to understand the value of platforms relative to their impact will be critical in driving effective campaigns for our clients. That is the goal of the Attention Economy, and our partnership with TVision will help us achieve that.”

Additionally, TVision will be a key partner as Dentsu Aegis Network creates its own attention model and metrics, incorporating data from partners measuring attention across additional devices. 

“As an industry we know that advertising works when people pay attention to it, and Dentsu’s Attention Economy initiative illustrates their clear understanding of this fact. We are pleased to partner with them on this initiative, and to help Dentsu utilize our data to create campaigns that deliver more value for their clients,” said Luke McGuinness, president of TVision.

TVision measures how people really watch TV and indexes how much attention viewers pay to programming and commercials. Marketers and media sellers access TVision’s TV engagement metrics via its data-as-a-service platform.

The streaming wars are on! An accelerated level of intensity is now in play as new and established players jockey for their share of subscribers. For now, consumers are continuing to subscribe to additional OTT services, paying on average $76 per month for video content. As new entrants come on board, though, PwC’s analysis shows consumers will start making choices about which services to keep after the initial promotional offers end.

While market share is available for the taking — the OTT video market is expected to double in size globally between 2019 and 2023 — services that don’t offer exactly what consumers are seeking will fall behind.

How do media companies set themselves up for success in the months and years to come? In this hyper-competitive landscape, viewer experience matters most. To deliver that optimal viewer experience, invest in content that engages consumers and boosts growth while leveraging emerging technologies like artificial intelligence (AI).

Content Is Key

Licensed content has powered streaming services in recent months, especially new entrants seeking to entice potential subscribers. Many services have demonstrated a willingness to pay hefty prices to obtain the rights to popular content with an existing base of loyal viewers.

In fact, PwC research found that 56% of consumers define a good user experience as having easy access to favorite shows. New streaming entrants seeking to gain subscribers will need to combine popular content that consumers already love with nostalgic shows they want to revisit.

However, licensed programming is not the only path to a competitive edge. Original content is just as important, according to PwC’s analysis. Consumers have already told us they want a seemingly endless library of TV shows and movies. Given the limited pool of licensed programming available, original content becomes paramount.

As the cost of licensed content continues to escalate, original programming offers streaming providers a more hands-on approach to building out and diversifying content libraries. It also offers complete control of the format, whether it’s shorter, more bite-sized content that audiences are showing an increased appetite for, or mobile-first content such as vertically shot videos. With original programming, the opportunities for creativity are boundless.

As we continue to analyze viewer preferences over the years, one finding remains constant: content rules. For streaming providers, that means long-term success will hinge on sussing out the optimal balance between original programming and licensed content.

In our hyper-personalized age, consumers want easily accessible content tailored to their specific preferences. Streaming services that leverage AI to recommend personalized content based on consumers’ viewing history are already a step ahead.

In fact, some 20% of consumers told us their streaming services are better at finding content for them to watch than they are themselves. While that is encouraging, it does offer room for improvement with the 80% majority. Meanwhile, one-third of consumers said finding content on streaming platforms needs to be easier.

Certainly, as in all industries, AI will improve with time. Consumers are impatient, though. They expect algorithms that are predictive — not reactive — to allow for positive viewing experiences. And they expect those improvements now.

Streaming services need to invest in the technology to make AI more effective now, rather than waiting for the technology to catch up. The services that perfect the ability to anticipate and recommend personalized content to viewers will stay above the fray while others fall behind.

According to PwC’s annual AI analysis, integration features prominently among the top three data-related challenges:

• Integrating data from across the organization (45%).
• Integrating AI and analytics systems (45%).
• Integrating AI with IoT and other tech systems (43%).

For the improved viewer experience that consumers are demanding, data integration will be job one.

Outside of AI, expect the continued global rollout of 5G to provide new opportunities to reach mobile viewers. Ensuring a service’s infrastructure can handle the increased demands of 5G networks will become essential, especially in the entertainment and media landscape that this new technology promises to transform.

Forward-looking streaming services are well-advised to prioritize emerging technologies as a strategic investment that differentiates them, rather than as an operational cost to be minimized. To attract new customers while retaining the existing subscriber base, bold long-term vision is vital.

A Game Plan for Victory

The streaming wars are complex, presenting media companies with equal parts opportunity and challenge. To win requires bold vision, artful navigation and a relentless focus on consumer needs.

Consumers have been very clear. They want world-class content combined with a superior viewing experience.

By optimizing investment in content — the right mix of licensed and original programming — and capitalizing on emerging technologies, media companies can chart a course for success.

Mark McCaffrey is U.S. technology, media and telecom leader at PwC.

Bernstein analyst Peter Supino launched coverage of seven cable, telco and satellite companies Wednesday with a positive outlook, adding that cable operators should enjoy mid-single digit revenue growth even as video customers decline.

Supino initiated coverage of Charter Communications (Outperform, $541 price target); Altice USA (Outperform, $38); T-Mobile (Outperforms, $103), Comcast (Market Perform, $50), Verizon (Market Perform, $63), AT&T (Market Perform, $36), and Dish Network (Under Perform, $29).

Supino noted in his detailed 84-page report that while Dish Network and the telcos have their own pressures to deal with, cable appears to be well positioned, based on strong broadband performance and prospects for commercial and mobile growth.

“With margins and [free cash flow] likely to improve and video less important to financial results, cable stocks enjoy multiple valuation tailwinds that offset the weight of the sector's high penetration levels,” Supino wrote.

He added that with capital expenditures expected to continue to decline, cash flow growth should be in the high-single digit percentages for cable operators.

The analyst introduced four investment themes to value the sector:

• Focus on pricing: Although the market is increasingly saturated, Supino believes there are sustainable opportunities in pricing and industry structure.
• Margins will be “stronger for longer” – Increased scale will continue to drive margins.
• Fiber is the key – As data demands grow and 5G continues to be hampered by siting and backhaul needs, “dense fiber networks are precious.”
• Video subscriber declines aren’t worth the worry: Supino believes that video losses “obscure otherwise rapid and durable cash flow growth.”

Cable stocks have been on a tear this year -- the sector was up about 50% for the first nine months of 2019 -- and are expected to continue on that pace. Supino appears to be equally optimistic -- his 12-month price targets on Charter, Altice, and Comcast represent a 10% to 30% premium of their closing prices on Oct. 15 

Nearly 20% of consumers subscribe to both a traditional and virtual MVPD service, according to a new Horowitz Research study.

Horowitz’s State of Viewing and Streaming reported that 15% of viewers defined by the research firm as “Mega-Omnivores” view content through traditional live television, DVR, on demand, streaming and live streaming, and are more likely to get that content through both a traditional cable subscription and digital services such as DirecTV Now, YouTube TV and Sling TV. On a weekly basis, this group — younger, male-skewing, high income — streams 54% of the time, according to the report.

The online survey of more than 1,600 viewers also reported that traditional television viewers remain the biggest group, with 35% of “5 O’Clock Diners” watching live TV through traditional multichannel video programming distributors or antennas. These viewers tend to be older, have less income and are less likely to have children in the home, said Horowitz.

“Omnivores” — viewers who only subscribe to an MVPD but occasionally stream content through services such as Netflix and Hulu — comprise 30% of TV content viewers.

“With more options than ever for accessing on-demand and live TV content, consumers have the freedom to build a customized viewing experience based on what they want to watch and how they want to watch it,” said Adriana Waterston, Horowitz senior vice president of insights and strategy.

Among the study’s other findings, 12% of TV content viewers (Content Paleos) stream all of their content, but don’t subscribe to a vMVPD; 6% (Flexitarian Lites) stream most of their content but have an antenna to watch live TV; and 3% (Flexitarians) stream all of their content and also subscribe to a vMVPD.

Various Errors (42%), web application attacks (29%) and cyberespionage (13%) top the list of data breach causes for organizations — public and private — that deal with “the creation, transmission and storing of information,” including of TV shows and movies.

That’s according to Verizon Communications’s 2019 Data Breach Investigations Report a review of data from 41,686 security incidents* and 2,013 data breaches** from 73 different sources. The goal, the report said, was to provide perspectives on threats “organizations like yours face.”

Verizon’s review found that a third of those threats (actually 34%) were internal, including misuse by authorized users and errors.

In the interests of better cyber-hygiene — have you scrubbed behind your virtual ears? — The Wire presents some of Verizon’s key takeaways:

1. Aiming for the top. C-suite execs are being increasingly targeted, with incidents rising from single digits in the previous report to dozens in the latest.
2. Threatening cloud. As companies transfer data to the cloud, stolen credentials are the method of choice for hacking those remote email servers.
3. Sorry, right number. Web-based payment card number theft is on its way to exceeding those from physical terminals, which may be a case of chip-and-pin card technology better protecting physical transactions.
4. Your money or your online life. Ransomware accounts for about a quarter of all malware-related incidents.
5. HR breathes easier. Attacks on human resources personnel have decreased, correlating with the virtual disappearance (pun intended) of W-2 tax form scams from the survey.
6. Not-so-smartphones. Mobile users are more susceptible to click on test phishing e-mails, in part because of the user interface.

* Incident: A security event that compromises the integrity, confidentiality or availability of an information asset.

** Breach: An incident that results in the confirmed disclosure — not just potential exposure — of data to an unauthorized party.

U.S. operators of over-the-top services will generate nearly $28.8 billion in subscription and advertising revenue this year, up about 26% from 2017, according to a new report from Digital TV Research.

Not surprisingly, much of that revenue growth will come from Netflix, which is forecast to grow revenue from around $11.7 billion in 2017 to about $15.8 billion this year.

Related: Netflix Misses Sub Target by 1M; Stock Slides

By 2023, Digital TV Research projects that U.S. OTT revenue will reach $47.8 billion.

Globally, the research company forecasts OTT revenue to grow by 30% to $69 billion in 2018, spiking to $129 billion by 2023.

Subscription video on demand services including Netflix, Hulu and Amazon Prime Video will see their total global revenue increase from $44 billion in 2017 to $69 billion by 2023, the research firm also predicted. 

Advertising-based video on demand services (AVOD) like YouTube, meanwhile, will see total global revenue increase by 36% from 2017-2023 to $47 billion.

Television is immersed in the modern, multiplatform age. But when it comes to the way people discover new shows, a decidely old-school method still rules the day, according to a new study from Viacom.

The primary means by which people find about new shows is through friends and family in person, according to research unveiled Thursday by Viacom executive vice president, chief research officer Colleen Fahey Rush at the Next TV Summit & Expo San Francisco.

Fahey Rush, who was joined on stage for the keynote Q&A by Multichannel News editor-in-chief and moderator Mark Robichaux, said that 90% of study respondents indicated they find out about their next must-see program via word of mouth.

TV promos - another old fashioned way as Fahey Rush put it — came in as the No. 2 way people discover new shows with 85% of respondents citing this methodology as how they find new programs. 

The findings are part of a larger Viacom study titled “Getting With the Program,” which was conducted to find out how people watch TV.

“There’s never been a better time to be a fan,” said Fahey Rush, who joined the company in 1996, explaining later in her presentation that viewers have more ways to watch than ever and they will continue to combine how they consume.

But with all this technology she doesn’t see traditional modalities to watch will go away.

“I think it’s [cable] going to last a long, long time,” she said.

Despite threats from over-the-top services like Netflix, Amazon and increased use of web video and mobile alternatives, the big four TV network brands are top-of-mind and continue to stay relevant for TV viewers, according to the latest edition of the Must Keep TV Report from the Toronto-based Solutions Research Group.

The proportion of Americans who would include at least one of the big four networks on their "must keep" list if they had to keep a small bundle was up 3 points from a low of 75% last year to 78% this year, SRG said in a release. The high water mark for this metric was 83% when SRG first started tracking in 2007. The seventh edition of the independent tracking survey is based on interviews with 1,400 American consumers aged 12-plus in early April 2014.

While the networks showed collective brand strength overall, the research found that the millennial generation continue to be less likely to want to include one of the big four in their top channels list – 68% did so in 2014, the same level as 2013, although much lower than the peak of 81% in 2007.

Top brand trends from the 2014 research include:

ABC retains the top “must keep TV” channel title in America for the total audience (aged 12-plus), followed very closely by CBS. NBC beat Fox to land at #3 for the first time since 2008.

ESPN is again the top cable brand American TV viewers can’t do without, coming in at #5 overall and as the top cable brand. Discovery, History, HBO, TNT and PBS round out the 2014 Top 10 TV brands.

Discovery regained its title as the leading non-sports cable brand in the country after losing it to History last year.

And...

FX was the leading momentum brand of the year, up six spots to #14, from #20 for full audience and as well jumping 5 spots among adults 18-49 from #17 to #12.

CW also gained, jumping to #16 from #21 overall.

AMC also was up 1 spot from last year and an impressive 16 spots since 2012. It was ranked as the #14 "must keep" brand for adults 18-49 this year, compared to a #30 ranking just two years ago.

CBS was number one among men 18-49 for the third year in a row and ESPN was the top cable brand by a wide margin in this demo.

SRG said it was notable that all major sports brands all did well this year, not just ESPN: ESPN2, NBCSN and Fox Sports 1 all trended up in rankings (up 6 spots from last year on average) compared to last year.

Top cable brands for women 25-54 were: Discovery, Disney, Bravo, HBO and the Food Network. HBO made it to the top 10 for the first time since 2009 in SRG tracking of this demo. Lifetime exited the Top 10 for women 25-54 for the first time since 2007.

Among African-Americans, cable brands which showed strong positive momentum include HBO, TNT, FX, Bravo, Disney, VH1 and AMC. HBO was the top cable brand among Latinos.

While consumers’ relationship with TV brands continues to be strong, American consumers do not have as many actual TV sets in the house as they once used to. Only 50% had 3 or more TVs in the home in this year’s research, compared to 56% last year, 61% in 2011 and 65% in 2007, when Must Keep TV was fielded for the first time.

SRG data also directionally suggests that TV brands that offer scripted dramas are seeing stronger consumer interest, particularly if they have strong archives of past episodes of their series available, or if past seasons are available on Netflix or on VOD for people to catch on and catch up with (not to mention availability via torrents). Before, people found character-intensive drama series more difficult to “drop in” on. They couldn’t follow the story, didn’t know the characters and only had time to keep up with only a few first-run series on a regular basis. The combination of greater availability of archives of show content online, including Netflix, and more comfort with the intimacy and flexibility of small screen Internet enabled devices, make immersion easier.

For brands that offer reality programming, social media has been a booster especially if they keep the shows relevant and part of the conversation using online video libraries, social media and re-packaging their stars and content on the web and social media to give fans edited highlights and a more intimate look at the reality characters they love.

The 2014 research is based on online interviews with 1,400 American consumers 12+ conducted in early April 2014 – the sample captures and represents all major population segments. Respondents are shown a list of 73 leading network/cable brands and are asked to identify which ones would be on their ‘must keep TV’ list if they had to choose a limited number. Sample design is balanced by geography, gender and ethnicity, including African-American and English-speaking Hispanics according to known universe parameters.