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Disney CEO Suddenly Discovers There Are Too Many Ads on TV; Cutting Ad Load on ABC, ESPN

Phillip Dampier February 15, 2017 Consumer News, Online Video 2 Comments

“I think that in general, there is probably too much commercial interruption in television,” Disney CEO Bob Iger told investors on the company’s first-quarter earnings call.

As some commercial networks cut “hour-long” TV shows to as little as 39 minutes, viewers have taken notice and are tuning out.

TV advertising loads — how many ad breaks and for how long — have been increasing since the 1950s, leaving viewers with less and less of their favorite shows. Networks have gotten creative over the years finding new spaces for advertising content by compressing opening titles and closing credits, telling producers to plan for shorter shows, using product placement to showcase brands and products inside shows, and editing or compressing older programs that can no longer fit in their allotted time slots.

The idea of reducing advertising is a recent phenomena, but one being taken seriously by networks that have watched ad revenue and ratings slip, as viewers learn to bypass or avoid advertising, or watch something else.

Iger promised an unspecified reduction in advertising on Disney-owned ABC and ESPN. It is uncertain if that will result in a slight decline of a minute per hour or something more dramatic. Time Warner, Inc., began opting for the latter in 2015, cutting ad time on certain shows on its TruTV network by half. Viacom and 21st Century Fox followed with experimental ad reductions of their own that same year.

Reducing advertising does not necessarily mean revenue reduction. Earlier experiments raised ad rates to compensate for the reduced number of commercials. Advertisers were reportedly pleased by the experiments because shorter ad breaks encouraged viewers to avoid channel surfing, giving higher exposure to advertising messages.

Comcast Launching New XFINITY Stream App to Access 200+ Channels, DVR In/Out of Home

Phillip Dampier February 14, 2017 Comcast/Xfinity, Consumer News, Online Video No Comments

Comcast today announced it is launching a new streaming television app for XFINITY TV customers allowing access to more than 200 live channels and DVR recordings on-the-go at no extra charge.

XFINITY Stream works with phones, tablets, and laptops in or out of the home, and will replace the XFINITY TV app when released for iOS and Android devices on Feb. 28.

The app will expand the ability of Comcast customers to watch their television lineup and DVR recordings anywhere there is a broadband connection. Many cable companies do not allow customers to watch DVR-recorded shows on portable devices and only have a small selection of cable channels available for viewing outside of the home.

“With the XFINITY Stream app, we are giving customers access to the best content in and out of the home with a growing list of advanced features and capabilities that make the mobile experience nearly identical to the cable experience they enjoy at home,” said Matt Strauss, executive vice president and general manager of Comcast Cable’s video and entertainment services.

Among the improvements claimed by Comcast:

  • availability of a Spanish language guide
  • X1-like experience
  • favorite channel filtering
  • 50 Music Choice music channels
  • Common Sense Media reviews and ratings
  • 40,000 on demand movies and TV shows
  • full access to your XFINITY DVR and its recordings
  • ability to download “thousands” of shows for offline viewing

Customers who have already installed the latest version of the XFINITY TV app on their devices need not do anything. The app will transition through an app update on Feb 28.

The Return of the Verizon Wireless Unlimited Data Plan Provokes Wall Street Anxiety

The days of wine and roses from wireless data profits may be at risk, according to some Wall Street analysts, after Verizon Wireless on Monday brought back an unlimited data plan it vowed was dead for good in 2011.

The “Cadillac” wireless network reintroduced unlimited data, phone, and texting this week at prices that vary according to the number of lines on your account:

  • $80 a month for one line
  • $70 a line for two lines
  • $54 a line for three lines
  • $45 a line for four lines

Verizon Wireless last enrolled customers in its old unlimited data plan in 2011, and a dwindling number of customers remain grandfathered on that plan, which began increasing in price last year and has since been restricted to no more than 200GB of “unlimited” usage in a month.

Verizon’s new unlimited data plan is a response to pressure from increasing competition, especially from T-Mobile and Sprint. All of Verizon’s national competitors have unlimited data plans with varying restrictions, and Verizon’s lack of one is likely to have cost it new customer signups last year. The company only managed to add 2.3 million postpaid customers in 2016, down from 4.5 million signed up in 2015.

CEO McAdam swore unlimited data was dead at Verizon

Causing the most irritation is T-Mobile, which near-constantly nips at Verizon’s heels with innovative and disruptive plans designed to challenge Verizon’s business model. BTIG Research analyst Walter Piecyk noted Verizon’s claims it does not need to respond to T-Mobile’s marketing harassment just don’t ring true any longer.

“Verizon has a long history of rebuffing T-Mobile’s competitive moves as non-economic or unlikely to have an impact on the industry for more than a quarter or two, only to later replicate the offer,” Piecyk said. “That was true for phone payment plans, ETF payments for switchers, overage etc. We can now add unlimited to that list. How long will it be until Verizon offers pricing that includes taxes? Despite those delayed competitive responses, T-Mobile has maintained industry leading growth while Verizon’s has declined.”

Piecyk believes Verizon Wireless rushed their unlimited data plan into the marketplace and its introduction seemed not well planned.

“We asked Verizon what has changed to explain such an abrupt reversal, but have yet to receive a response,” Piecyk said. “They had recently been running an advertisement promoting the 5GB rate plan that argued why customers do not need unlimited. The rate plan remains, but it is not clear if the advertisement will. The launch of unlimited seemed rushed, coming a week after the exposure they could have secured with a Super Bowl advertisement. The ad run last night during the Grammy’s did not appear to have taken much to produce.”

Verizon Wireless executives have argued for years customers don’t need unlimited data plans and Verizon would no longer offer one:

  • With unlimited, it’s the physics that breaks it. If you allow unlimited usage, you just run out of gas. — Lowell McAdam, Verizon CEO (September, 2013)
  • At this point, we are not going to entertain unlimited. Promotions come and go. We can’t react to everything in the marketplace.” — Fran Shammo, former Verizon CFO (January, 2016)
  • “I’ve been pretty public saying the unlimited model does not work in an LTE environment. Unlimited is a very short-term game in the LTE market. Eventually unlimited is going to go away because you have to generate cash to reinvest.” — Fran Shammo, former Verizon CFO (March, 2016)
  • Unlimited data plans were “not something we feel the need to do.” — Matthew Ellis, Verizon CFO (January, 2017)

Shammo: Unlimited doesn’t work on LTE networks.

The impact of not having an unlimited data plan appears to have convinced Verizon to change its mind, and that comes as no surprise to Roger Entner of Recon Analytics.

“In three to five years, unlimited plans will come back,” Entner predicted in 2011. He claimed back then wireless carriers were initially unsure how to predict data usage growth on their networks and placing limits on usage gave carriers more predictable upgrade schedules. But after several years of data, Entner said carriers can now better predict the amount of data an average subscriber will use in a month, giving them confidence to remove the caps.

Verizon Wireless’ unlimited plan includes several fine print limitations that provide additional network protection for Verizon and manage any surprise usage:

  • Unlimited use is only provided on Verizon’s 4G LTE network. Limits may apply to customers using older 3G networks, which are less efficient managing traffic;
  • Unlimited not available to Machine-to-Machine Services;
  • Customers with unlimited data plans may find their traffic deprioritized on congested cell sites after 22GB of data consumption during a billing cycle. This speed throttle can reduce network speeds to near-dial up in some circumstances, at least until site congestion eases;
  • Mobile hotspot tethering on this unlimited plan is limited to 10GB per month on Verizon’s 4G LTE network. Additional usage will be provided at 3G speeds. This is designed to discourage customers from using Verizon Wireless as a home broadband replacement;
  • Verizon’s ultimate 200GB monthly limit is also presumably still in place. If you exceed it on Verizon’s legacy unlimited data plan, you were told to shift to a tiered data plan or had your account closed.

Piecyk thinks Verizon’s unlimited data plan may have been rushed out.

Although consumers clamoring for an unlimited data plan from Verizon are happy, Wall Street is not. Analysts are generally opposed to Verizon’s return to unlimited, with many suggesting it is clear evidence the days of high profits and predictable revenue growth are over. That is especially bad news for AT&T and Verizon Wireless, where investors expect predictable and aggressive returns. Verizon has already warned investors it expects revenue and profits to be flat this year.

Jeffrey Kvaal with Instinet believes Verizon’s traditionally robust network coverage is no longer an advantage as competitors catch up and unlimited data is the final nail in the coffin for wireless revenue growth. That means only one thing to Kvaal, AT&T and Verizon must pursue growth outside of the wireless industry. Verizon, in particular, is facing investor expectations it will do something bold in 2017, such as making a large acquisition like a major cable operator.

Evercore ISI’s Vijay Jayant believes unlimited data is bad news for all carriers from the perspective of investors looking for revenue growth.  Jayant told investors in the short term, unlimited data may help Verizon’s revenue because the plans are expensive, but in the long run Verizon is sacrificing the revenue potential of monetizing growing data usage in return for a high-priced, flat rate option. That guarantees “customers won’t see their bills rise, even as their usage does,” Jayant said.

Some analysts point out Verizon’s unlimited data plan is expensive, limiting its potential attractiveness to customers considering jumping to another carrier. While Verizon charges between $80-180 (for one to four devices), AT&T charges between $100-180 for unlimited plan customers, who must also sign up with DirecTV to get an unlimited data plan. T-Mobile charges between $70-160 and Sprint charges between $60-160. The cheapest is T-Mobile, because its plans are all-taxes/fees inclusive. All four carriers have soft limits after which customers may be exposed to a speed throttle. AT&T can temporarily throttle users at 22GB, Sprint can throttle above 23GB and T-Mobile after 28GB.

The Wall Street Journal discusses Verizon’s unlimited data plan and its caveats. (4:55)

Comcast Obliterates Viewership of Its Own NBC Station in Boston

Phillip Dampier February 9, 2017 Comcast/Xfinity, Consumer News 2 Comments

Comcast’s effort to run its own NBC affiliate in Boston from an over-the-air station in New Hampshire appears to have initially backfired, causing the ratings to hit rock bottom with fewer than 10,000 viewers aged 25-54 watching the station’s 6pm local newscast.

In its first month as an NBC station, WBTS-TV’s local newscasts scored in the ratings about as well as an infomercial, coming in last place for most of its newscasts in all the ratings demographics that count with advertisers. NBC Boston’s 5pm local newscast averaged only 5,555 viewers aged 25-54. Its 6pm local news only attracted 9,340. In contrast, NBC’s former home in Boston – WHDH, managed to bring in 26,791 and 30,999 viewers for its two evening newscasts. Despite that, the NBC affiliation loss still hurt WHDH, which dropped to second place in the Boston market for some of its newscasts.

But a ratings collapse hurt WBTS even more, considering most locals watch the station over Comcast Cable and don’t have trouble finding NBC on the cable dial. Cord-cutters have to contend with challenging reception, especially in areas south of Boston. In response to viewer complaints, Comcast’s David Cohen said the cable company temporarily bought a digital subchannel on WMFP-TV, the full power Boston affiliate of preacher Jimmy Swaggart’s Sonlife Broadcasting Network.

Comcast’s long-term solution to solving its reception problems in Boston? Cohen told Sen. Ed Markey (D-Mass.) the cable company would eventually buy another full-power TV station in or around Boston.

Charter Spectrum Raising Broadband Prices $5; $64.99/Mo for Entry-Level 60Mbps Plan

Customers in Florida and Texas received this notice with his latest cable bill. (Image courtesy: Nucleartx)

The “consumer benefits” of Charter Communications’ acquisition of Time Warner Cable and Bright House Networks just keep on coming as the company has begun hiking the cost of its broadband plans by $5 a month:

Important Billing Update: At Spectrum, we continue to enhance our services, offer more of the best entertainment choices and deliver the best value. We are committed to offering you products and services we are sure you will enjoy.

Effective with your next billing statement, pricing will be adjusted for:

  • Internet Service from $59.99 to $64.99.

If you are currently on a discounted rate, you will not realize an increase until the end of your promotional period.

The rate increase means Charter/Spectrum’s nationally available, entry-level broadband plan will now cost customers $64.99 a month. The company is also hiking rates on its Ultra tier (300Mbps in former Time Warner Cable Maxx markets, 100Mbps in most other markets) by $5 to $104.99.

Customers signed up to Spectrum’s base 60Mbps internet plan may be able to threaten their way to a lower price by contacting customer service and informing them you plan to switch to Earthlink, which is offering lower-speed plans as low as $29.99 a month for six months. Charter Spectrum has given many complaining customers a 12-month retention plan priced at $39.99 or $44.95 a month for 60Mbps.

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