Will Dish Network Challenge Netflix by Streaming Blockbuster Films?

  • Dish is expected to introduce a streaming movie service under its Blockbuster brand next month. The move will introduce a competitor to Netflix and coincide with that company’s recently announced price increase.
  • When Dish acquired Blockbuster’s assets in April for $320 million, it received content rights that it has sought to beef up through discussions with the studios.
  • “This ought to begin changing the way investors think about Dish,” said Ryan Vineyard, an analyst at RBC Capital Markets. “It goes from being an old-school pay-TV company to launching what could be a really high-growth business.”
  • Dish currently ranks as the second largest U.S. satellite-TV provider behind DirecTV.

Will Dissolution of the Netflix-Starz Relationship Impact Video Biz?

  • Netflix walked away from another deal with Starz after that company insisted on a tiered-pricing model similar to what they would get with a cable channel. Netflix did not want to tamper with the simplicity of its monthly fee model.
  • Netflix had reportedly offered Starz more than $300 million per year to renew their agreement.
  • With the demise of the Starz deal, Netflix customers may feel that they are paying more and getting less. Still, Netflix counters that their Starz content accounts for only 5-6 percent of domestic viewing.
  • Netflix will be challenged by competitors like Hulu, Amazon, Apple and Microsoft XBox Live. Moreover, cable companies are increasingly offering similar access to video through TV Anywhere services.
  • Starz may either sell its content to a Netflix competitor or try and create its own streaming brand like HBO.

Yahoo Hopes to Increase Net Traffic with More Original Programming

  • Yahoo will introduce a new lineup of original programming beginning in early October, reports Variety.
  • The eight short-form series will feature appearances from actors including Morgan Spurlock, Niecy Nash and Judy Greer.
  • Erin McPherson, VP and head of video at Yahoo, indicates this is the first phase in a planned increase for 2012 regarding originals hoping to “yield even bigger names, longer programs and maybe even scripted fare.”
  • “While Yahoo isn’t about to overtake Fox or CBS as those nets launch their fall schedules, the company will mix some traditional TV programming tactics with its own new-media savvy,” suggests the article.
  • Yahoo reportedly leveraged user metrics to determine what types of shows would sell and has plans to redesign its video platform to be more like Netflix and YouTube.
  • According to Variety: “Of the 47.3 million video streams Yahoo generated in July, its original series alone garnered 27 million — more than the 24.4 million Hulu scored in its entirety that month.”

Judge Enters His Own OVD Condition with Comcast-NBCU Final Judgment

  • Consent from the U.S. Department of Justice for the Comcast-NBCUniversal merger has been approved, but with a new condition.
  • Comcast purchased 51 percent of NBCUniversal from General Electric in January, creating a $30 billion business that includes broadcast, cable networks, movie studios and theme parks.
  • At that time, the Department of Justice said Comcast could acquire NBCUniversal only if it ceded control of Hulu and made stand-alone broadband service available at $49.95 per month for three years, but the settlement still required final approval.
  • Last week, Judge Richard Leon delivered final approval, but stipulated that the federal government would monitor whether rival online video services, such as Hulu or Netflix, demand arbitration to license content from Comcast-NBCU for the next two years.
  • The ability of rivals to obtain programming was one of the key concerns of the DOJ and the FCC during reviews of the merger.
  • “Since neither the Court nor the parties has a crystal ball to forecast how this Final Judgment, along with its arbitration mechanisms, will actually function … I believe that certain additional steps are necessary,” Leon said in a court order.

Do American TV Viewers Prefer Streaming Over Transactional VOD?

  • Online video subscribers of Netflix and Amazon Prime paid almost $50 on average for video subscriptions during a recent six-month period.
  • According to new research from Parks Associates, subscribers spent less than half of that amount on a la carte video purchases.
  • The number of movie and TV show downloads declined 56 percent from 2009 to 2010, and movie rental downloads decreased 70 percent.
  • “Based on the reported usage of video download services by U.S. survey respondents in Q4, consumer spending on a la carte video during a six-month period ranged from $12 to $26,” reports Home Media Magazine. “Comparable spending on video services subscriptions during that same period reached at least $48 per household.”
  • “The all-you-can-eat-style subscription approach taken by Netflix has proven successful in the U.S. market,” Parks said in its report. “It has helped to drive up consumption — and spending — for online video.”
  • Netflix ended the most recent fiscal quarter with more than 25 million subscribers in North America.

Flipboard Hopes to Integrate Video with its Social Media Magazine

  • Palo Alto-based Flipboard plans to add film and TV to its social media magazine platform. Flipboard is currently available only on the iPad, but an iPhone version is expected to launch in a few weeks.
  • Reuters reports that the company “hopes to cut deals with studios to carry movies and episodes of TV shows, getting into territory staked out by Netflix, Hulu and Facebook.”
  • Mike McCue, chairman and chief executive of Flipboard, explained he will begin the video project at the end of this year and also hopes to sell electronic books.
  • Flipboard’s service takes a cut of the revenue from advertising. “We’re trying to create the largest company possible,” said Danny Rimer, general partner at Index Ventures, a Flipboard investor. Reuters points out: “Rimer believes display advertising revenue’s migration online is ‘a very big opportunity.'”

Hollywood Suite: Will New Canadian VOD Service Compete with Netflix?

  • Hollywood Suite is a new video-on-demand service with plans to launch in Canada this November.
  • Available via cable, the Internet and satellite TV, the service will offer 450 titles per month in HD from MGM, Warner Bros. and others.
  • The Toronto-based platform will also feature independent action, romance and relationship films.
  • According to Home Media Magazine: “Movie titles, subscription fees and rental programs, which are expected to rival rates charged by Netflix, will be announced closer to launch date, according to industry veteran Jay Switzer, co-founder of Hollywood Suite.”
  • “These channels are designed to meet the strong audience demand for movies across all platforms and support Canada’s television service providers,” Switzer said.

Pay TV Subs Continue to Decline: Consumers Turn to Web

  • As the monthly costs for pay TV have risen from $11.97 in 1986 to $49.70 this year, consumers are looking for inexpensive Web alternatives like Netflix and Amazon.com.
  • Three of the past five quarters have seen an overall decline in pay TV subscriptions, according to SNL Kagan.
  • “Barclays Capital analyst James Ratcliffe predicts that as young people who now rely on Internet-TV alternatives age, penetration of pay TV among occupied homes gradually will decline,” explains The Wall Street Journal. “He sees it dropping to 79 percent by 2018 from 89.5 percent now, although he predicts the pay TV industry won’t lose subscribers in an absolute sense until 2016.”

Miramax is the Latest to Offer Facebook Movie Rental App

  • Miramax is following in the footsteps of Warner Bros., Paramount and Universal by making its films available on Facebook.
  • The Miramax eXperience will initially offer 20 titles in the U.S. and 10 each in Great Britain and Turkey (available films include “Good Will Hunting,” “Spy Kids,” “Chicago” and “Cold Mountain”).
  • Movies will be made available for 30 Facebook credits (equivalent to $3) and can be viewed on Facebook, the iPad and Google TV.
  • Miramax hopes to build its reach to 150 million+ Facebook friends in the next 18 months.
  • “The iTunes-like nature of Miramax’s Facebook movie rentals (i.e. per-movie charge, rather than a subscription fee) could prove very effective,” reports Social Times. “A lot of online movie watchers aren’t ready to commit to a subscription service like Netflix or Hulu Plus. Renting a single movie from Facebook may be more their style, and a $3 movie rental sounds like a pretty good deal, if you ask me.”

Marc Andreessen Believes Software Is Eating the World (A Good Thing)

  • “In an upbeat and highly insightful essay on technology and innovation, pioneer Marc Andreessen outlines the ‘dramatic and broad technological shift in which software companies are poised to take over large swathes of the economy…'” comments ETCentric staffer Bob Lambert with this submission.
  • Andreessen notes HP’s announcement that it is “exploring jettisoning its struggling PC business in favor of investing more heavily in software” and Google’s plans to “buy up the cellphone handset maker Motorola Mobility” as recent surprises in the tech world, yet also examples of what makes the pioneer “optimistic about the future growth of the American and world economies.”
  • Andreessen suggests that Apple and Google are undervalued and we should avoid using the term “bubble” when analyzing the value of technologies. He writes: “…too much of the debate is still around financial valuation, as opposed to the underlying intrinsic value of the best of Silicon Valley’s new companies.”
  • “Over the next 10 years, I expect many more industries to be disrupted by software, with new world-beating Silicon Valley companies doing the disruption in more cases than not,” Andreessen adds.
  • Andreessen’s essay offers a compelling take on the direction of the tech industry, its place in world economies and some of the challenges that lie ahead. He notes interesting examples including Amazon, Netflix, Pixar, Pandora, Skype and others.
  • “Instead of constantly questioning their valuations, let’s seek to understand how the new generation of technology companies are doing what they do, what the broader consequences are for businesses and the economy and what we can collectively do to expand the number of innovative new software companies created in the U.S. and around the world,” he concludes. “That’s the big opportunity. I know where I’m putting my money.”

Cord-Cutting: Record Numbers in Cancelled Pay TV Subscriptions

  • The six largest cable and satellite TV providers lost 580,000 customers in the second quarter. This marks the largest such decline in U.S. history.
  • The number of pay TV subscribers has declined in three of the past five quarters.
  • “Rising prices for pay TV, coupled with growing availability of lower-cost alternatives, add to a toxic mix at a time when disposable income isn’t growing,” explains Sanford C. Bernstein analyst Craig Moffett. “For younger demographics, where in many cohorts unemployment is north of 30 percent, and especially for those with limited or no interest in sports, the pay TV equation is almost inarguably getting less attractive.”
  • Netflix and Hulu provide lower cost options. Competition from AT&T and Verizon is also having an effect.
  • Providers are struggling to deal with the trend. Dish, for example, is re-positioning itself away from lower income customers. Instead, the company plans to focus on more expensive offerings to increase average revenue per user.

Home Entertainment Spending Seems to Have Stabilized in Q2

  • An increasing number of viewers are turning to rental programs for movies and TV shows, according to a report from Digital Entertainment Group.
  • DEG also reports that consumer spending on home entertainment has stabilized with an unexpected recovery to the disc-based business in the second quarter.
  • The report concludes that consumers spent $4.2 billion on transactional video services — disc rental, streaming and VOD — during the first half of 2011. These figures mark an 11 percent increase over the same period last year.
  • The report also mentions a 16 percent drop in disc purchases, with combined Blu-ray and DVD sales falling to $1.8 billion in the second quarter. However, rental — including streaming and VOD — was up 11.16 percent. (Blu-ray sales increased 10 percent, while demand for DVD declined.)
  • Netflix rose 45.7 percent in the first six months of this year, while kiosk rental (mostly Redbox) rose 39.8 percent.
  • The Hollywood Reporter adds: “Spending on Blu-ray Discs was up a solid 10 percent in the first half. DEG estimates that the number of U.S. households with at least one Blu-ray Disc playback device rose 16 percent in the first six months of 2011 to bring total household penetration to more than 31.6 million, making the format one of the fastest-growing new technologies in the home entertainment industry.”

Elite Premium TVs Merge the Best of Pioneer and Sharp

  • The new Elite brand of premium LCD TVs is the result of a collaboration between Pioneer and Sharp.
  • Two LED-based LCD models (60- and 70-inch) are 3D, THX certified, claim a refresh rate of greater than 240Hz and feature full-array backlighting instead of edge lighting. They also feature online services such as CinemaNow, Netflix, VUDU and YouTube.
  • Elite TVs include a yellow sub pixel with the standard red/blue/green, that when added together, creates more than 8 million dots on the screen.
  • “But the feature that the company is most hyping is something called Intelligent Variable Contrast,” reports Electronic House. “Found only on the new Elite TVs, it automatically controls both the brightness and backlight to enhance color depth, brilliance and detail in dark areas.”
  • The 3D Elites will ship with active shutter glasses — MSRP of $5,999 for the 60-inch model and $8,499 for the 70-inch.

New Philips HDTVs Will Access Cloud Games and Set-Top Functions

  • Philips announced it will be including streaming set-top and gaming functions in some of its new HDTV sets.
  • The Philips 4000 and 5000 series, which use the CloudTV platform of ActiveVideo Networks, can access cloud-based games streamed as MPEG files.
  • Both lines will include Philips MediaConnect, that enables wirelessly connecting the TV and PC.
  • Other features include NetTV (offering services such as Netflix, VUDU, Facebook, Film Fresh, Pandora and Twitter), V-tuner Internet radio and built-in Wi-Fi support.
  • The 4000 series features six screen sizes, ranging from 19 to 55 inches, while the 5000 series adds another 10 screens, from 40 to 55 inches.

Warner Bros. Rolls Out Flixster Collections Video Service this Week

  • Time Warner CEO Jeff Bewkes announced the availability of Flixster Collections, a social movie portal that went into public beta this week.
  • The service, a revamped version of the Flixster product acquired earlier this year, encourages users to share what they’ve watched with friends.
  • If there’s something you want to see, for example, Flixster directs you back to Amazon, iTunes, Hulu and Netflix (as well as your hard drive, if you let it). There are also links for theatrical films, including reviews, trailers and ticketing services.
  • “You can also imagine how this will tie in to Ultraviolet, the cloud/locker system for video that Warner and a big coalition of movie studios and tech companies (except for Apple and Amazon) are pushing,” writes Peter Kafka in All Things D.
  • So far, Flixster Collections is available for PCs and Macs, but no mobile app yet.