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Walmart Educating Consumers on How to “Cut the Cord”

Phillip Dampier September 14, 2016 Competition, Consumer News, Online Video 3 Comments

walmartWalmart is recommending customers consider cutting off cable television for good with a step-by-step guide advocating an end to high-priced bills for hundreds of channels you’ll never watch:

When you sign up for cable, you are sold on the possibly hundreds of channels you will have access to, but how many do you actually watch? Most people find that they have, at most, a couple dozen channels that carry all of their favorite shows, while the rest are just filler. Unfortunately, whether you watch them or not, you’re still paying for all of those extra channels. Part of the tremendous savings (an average of $80 a month) in cutting the cord is moving to services that offer a smaller set of channels representing only what you want to watch. Not only do you just have the channels that you actually want, but streaming services are far more convenient, since they’re geared towards on-demand delivery of content. You watch what you want when you want. Most are month-to-month, meaning you can switch it up anytime rather than being stuck in a long-term contract.

The guide gives Walmart the obvious opportunity of selling customers on new televisions and equipment to enhance their streaming experience, and they don’t forget to mention how to hook up an antenna they just happen to sell to get local stations back on your cable-less television.

Walmart also uses its “cord-cutting” guide to upsell customers on VUDU, an often-forgotten pay-per-view streaming service Walmart just happens to own.

Hulu’s Money Blowout: Analyst Predicts Forthcoming Live TV Service Will Lose Real $$$

huluTM_355Hulu’s still-to-be-announced live TV streaming service designed to give subscribers an alternative to bloated and expensive cable-TV packages will lose “real money” if it is priced at around $40.

BTIG Reseach analyst Brandon Ross’ research note to investors (reported by Fierce Cable) claims Hulu faces big expenses to include sports and CBS programming — the one network that isn’t a part-owner of Hulu — into its forthcoming package of live and on-demand programming. With most sources claiming Hulu intends to price the service starting at prices as low as $35-40 a month for a slimmed down package of cable television and over-the-air stations viewable on one device and $50 a month for those wanting to watch on multiple devices, Ross predicts the service will rapidly run into the red because of programming costs.

Hulu’s live streaming service could be a real game changer for online cable TV alternatives, because it is expected to contain a robust assortment of popular cable networks and regional sports channels that could appeal to a wider marketplace than even slimmer packages from Sling TV.

Video margins are dropping, which means smaller operators have less to invest in broadband.

Video margins are dropping as programming costs continue to grow. Cable operators are turning to broadband to make up the difference, but virtual providers like Hulu don’t have that option.

“The ramifications of success could have an effect that goes far beyond just Hulu’s partners, from [competing cable TV providers] to cable networks to Netflix. A failed Hulu virtual [cable-TV provider] could dispel the idea of widespread competition for incumbent bundles from virtual bundled competitors,” Ross wrote in his research note. “We are skeptical that the Hulu bundle will meaningfully impact the [cable-TV] landscape from a subscriber standpoint. We simply wonder whether the price/value will be strong enough to attract customers at ~$40, with much less content than the current larger bundles.”

Ross predicted Hulu will bundle several expensive sports networks, as indicated in surveys Hulu sent to potential customers. Those surveys suggested Hulu’s service will include a variety of Regional Sports Networks from Hulu’s owners, which include Fox and Comcast-NBC. One potential exclusion is Madison Square Garden Network (MSG), a potential omission that concerned MSGN investors enough to drive the share price down after a significant spike in mid-August.

The issue of MSG could open an interesting new front in the war on cable television pricing. MSG’s viewership is focused in New York, New Jersey and Connecticut and one of the largest cable providers in the region is cost-conscious Altice USA, which took over Cablevision. Ross states MSG Network’s addition on the Hulu lineup could give Altice more leverage to force better contract renewal terms.

“For instance, Altice could theoretically tell those that want MSGN to switch their video provider to Hulu, while staying on Altice for broadband,” Ross wrote. “We do not believe this would be an ideal approach for either party, but it is possible.”

CBS Considers Ad-Free All Access

Phillip Dampier August 11, 2016 Consumer News, Online Video 2 Comments

cbs all accessCBS may have discovered consumers don’t like to pay $5.99 for the company’s streaming service only to be inundated with just as many commercials as an over-the-air viewer encounters without having to pay a penny.

“We’re toying with the idea of a commercial free option and how we might roll that out to consumers,” Marc DeBevoise, president of CBS Interactive said Wednesday at the Television Critics Association summer press tour, reports Variety.

The monthly fee includes live streaming of the local CBS affiliate in some markets and a library of content — both old and new — owned or licensed by CBS. While some of the older shows are shown with few commercials, current season shows often contain a full commercial load. That appears to be turning viewers off, and the service is growing more slowly than its competitors.

DeBevoise told attendees CBS will try limiting the ad load on debuting original content that will be available exclusively through CBS All Access in the United States. A new version of “Big Brother” is the first new series, expected to start this fall. “Star Trek: Discovery” and a spinoff of “The Good Wife” will follow in 2017. CBS plans to cut ads by 25% for those shows, leaving paying streaming viewers with about 12 minutes of ads to watch per hour.

To draw attention to the streaming service, CBS will air the pilot episode of “Star Trek: Discovery” on the broadcast network, but episodes after that will be exclusively available online.

CBS is planning to introduce other streaming-exclusive series through All Access with four new shows for 2017 and more beyond that.

CBS wouldn’t say how much it might charge for ad-free viewing.

Hulu Ending Free Streaming; Yahoo Will Pick Up Where Hulu Quit

Phillip Dampier August 8, 2016 Competition, Consumer News, Online Video 1 Comment

huluTM_355Ad supported free streaming of current TV shows and movies on Hulu will come to an end over the next several weeks as it converts to an all-paid subscription service.

For the last few years, Hulu has progressed towards a goal of creating an online streaming alternative to cable television that is owned and operated by content creators, cutting out the middlemen — traditional distributors like cable, phone, and satellite companies.

When it launched in 2007, Hulu offered a central website for television shows from three of the four major networks – ABC/Disney, NBCUniversal, and 21st Century Fox all offered full-length shows and clips on Hulu. (CBS has always preferred to showcase its own content in-house or through very restrictive contracts with third-party distributors.)

Hulu began with a limited commercial load, but has gotten progressively more ad-heavy over the last nine years. Most of Hulu’s free content has been limited to a maximum of the five most recent episodes of a current show, each appearing about a week after it originally airs. Those looking to view Hulu on a variety of wireless devices have been required to subscribe to a subscription tier since 2010, dubbed Hulu Plus. Subscribers still saw commercials, but also received access to more content viewable on more devices.

plans

Hulu’s growth has always been stunted by its marketing — charging a subscription fee and continuing to show 15-20 minutes of ads each viewing hour. In 2015, Hulu began offering customers an ad-free option for $11.99 a month, as much as $3 more than Netflix. But Hulu began adding new customers willing to pay their price to avoid commercials.

In the last two years, Hulu’s content library has grown substantially, and relying on viewers watching free content has become less important to a service with 12 million paying subscribers.

“For the past couple years, we’ve been focused on building a subscription service that provides the deepest, most personalized content experience possible to our viewers,” said Ben Smith, Hulu senior vp and head of experience. “As we have continued to enhance that offering with new originals, exclusive acquisitions, and movies, the free service became very limited and no longer aligned with the Hulu experience or content strategy.”

It has gotten so limited that new site visitors have trouble even finding the remaining free content.

Hulu is also preparing to launch a $40/month cable-TV replacement service sometime next year that will offer dozens of live cable channels bundled with Hulu’s on-demand content. The service could become a significant threat to traditional cable TV and promote more cord-cutting.

Hulu's free content is moving to Yahoo View

Hulu’s free content is moving to Yahoo View

Hulu has shown no interest in slowing down. In fact, in response to increasing competition for content, last week Hulu agreed to sell a 10% interest in itself to Time Warner (Entertainment) in a deal worth $583 million. That deal assures Time Warner-owned channels (TNT, CNN, Turner Classic Movies, TBS, etc.) will be on Hulu’s cable-TV service next year. Hulu is expected to spend that money on licensing more content for subscribers.

Current free Hulu viewers need not worry about the change in Hulu’s status. Visitors will be offered free trials of Hulu’s premium options and Yahoo has agreed to adopt Hulu’s player and its existing free ad-supported library of TV shows, movies and clips for its Yahoo View service, which launched this morning.

Netflix on Your Comcast Set-Top Box Will Count Against Your Usage Allowance

Phillip Dampier July 26, 2016 Comcast/Xfinity, Consumer News, Data Caps, Online Video, Public Policy & Gov't Comments Off on Netflix on Your Comcast Set-Top Box Will Count Against Your Usage Allowance

Comcast-LogoLater this year, Comcast customers will be able to watch Netflix content with the cable company’s X1 set-top box.

At the time the deal was first announced, there was no word whether Comcast would apply its usage caps on Netflix usage, but Ars Technica reports Comcast will, in fact, count Netflix content you watch with an X1 against your monthly internet usage allowance.

“All data that flows over the public internet (which includes Netflix) counts toward a customer’s monthly data usage,” a Comcast spokesperson said.

Comcast has been gradually imposing its 1TB cap in an increasing number of service areas, where customers face paying an extra $50 a month for an unlimited plan or up to $200 a month in overlimit penalties for exceeding that allowance.

As of now, only Comcast’s own Stream TV is exempt from Comcast’s usage caps. Comcast claims its streaming service doesn’t qualify for its usage caps because it uses Comcast’s own internal network, not the public internet, to reach customers.

 

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