Of Course It Is

I have said this for years, cord cutting will not reduce costs for people seeking content around the country.  This is just the latest recognition of the fact that the content producers control pricing and they will not deeply discount their products because you get it through the Internet or through a cable.  One caveat...this does not take into account ala carte.  This is a simple apples to apples comparison of like packages.

CORD-CUTTING NO BARGAIN

Wall Street Journal

personal technology writer Geoffrey A. Fowler is clearly a fan of cord-cutting—at least in theory. "But after reviewing pretty much every available Internet TV service, streaming box and smart TV, I’ve yet to find a replacement that covers all the TV bases while costing less," he wrote in a detailed analysis piece.

First off, Fowler says you have to have a fast Internet connection to make video streaming viable. And, for most people, the best deal comes from an MVPD, which is also pushing its TV service. He notes that cord-cutters have to give up a lot of live TV, although more is becoming available from OTT services. To replace cable most people will have to subscribe to multiple streaming services—which is complicated. And for all that effort, he notes, the cord-cutter may not save any money. 

Cheating

Sorry for the distance between posts, just got back from a week long vacation.  I wanted to post this becasue I am always reading the smug comments on social media about people who don't pay for content and accuse anyone who does of being chumps.  They are, simply put, stealing.


‘CORD CHEATING’ WORSE THAN THOUGHT
According to new research from

The Diffusion Group (TDG), more than 20% of adult broadband users who stream video from an online subscription service are "cord cheaters"—consumers who access these services using the account name and password of someone that does not reside in their household. "While it is widely acknowledged that ‘cord cheating’ is occurring, few comprehend how widespread the behavior has become," said Michael Greeson, TDG Founder and Director of Research.

According to a TDG’s latest research, a sizable segment of online subscription video viewers live in households that are not paying to enjoy on-demand access to movies, TV programs, and a host of other high-value video content. Content providers are losing substantial revenue by not enforcing more restrictive authentication procedures.

Importantly, the rate of "cord cheating" varies dramatically among OTT SVOD services. For example, 20% of

Netflix streamers are guilty of using non-resident credentials, compared with only 10% of Amazon Prime streamers. Even Dish Network’s new Sling TV service is not immune to this behavior, with an astounding 26% of viewers reporting that they use the credentials of someone living outside their home.

"This behavior reflects the unfortunate mindset among
many of today’s media users that it’s perfectly acceptable to ‘share’ digital media—whether files or service access— among friends and family," notes Greeson.

And in other news.....

JANUARY: CABLE BETTER THAN BROADCAST

Writing on the company blog,

Standard Media Index (SMI) Chief Commercial Officer James Fennessy says that digital spending jumped 30% in January, while TV got off to a slow start for the year. SMI calculates that digital now commands 27% of all national ad spend—up dramatically from only 19% share just two years ago. "A key driver of this growth is digital video, which has emerged as the fastest-expanding segment of the digital market, thanks to leading networks making more of their inventory available to consumers through their digital platforms," he said. Fennessey added that the trend is only set to accelerate as media owners focus on tapping into new audiences and the advertisers trying to reach them.

SMI’s figures show upfront spend

down in the mid-single digit range from this time last year, and while the scatter market is relatively strong, it is not yet making up for those lost upfront dollars. In January, the scatter market grew a healthy 39%, an upswing that helped the cable sector deliver 5% growth from the same period last year. The gain was primarily driven by ESPN, which grew 29% year-on-year, thanks to the ratings bonanza they experienced for the first ever college football playoffs. The biggest spender in scatter was the automotive sector, with advertisers spending over four times more than they did in January last year. Other key categories driving the scatter market were toys and telecommunications, both more than tripling their advertising spend.

On the broadcast TV front, things have not been too rosy. Overall, the sector fell 6% from the same period last year. Hispanic broadcasters bucked this trend, with Telemundo performing strongly and Univision also posting a solid increase on its 2014 numbers.

Broadcast drags down numbers, but cable strong!

JANUARY AD SPENDING UP, CABLE LEADS TV
The U.S. ad market kicked off the year strong, with Standard Media Index (SMI) reporting overall spending up 5% in January, compared to a year ago. That was despite some key categories, such as automotive and consumer packaged goods (CPG), pulling back on ad buying.  While the total market grew, television ad revenues remained relatively weak and fell 1% in January as a result of the soft upfront market and lackluster ratings. Spend was dramatically reduced in automotive (-6%) and CPG (-5%)— traditionally big TV advertiser categories—which also contributed to the soft TV spending.  While overall TV was down slightly in January, SMI’s latest data shows that cable was relatively strong, with the sector delivering 5% growth. Leading the charge was ESPN, whose record-breaking broadcast of the first-ever college football playoffs saw its ad revenues jump 29%.

It was not so rosy for broadcast TV, which saw year-over-year ad revenues fall 6% in January, in large part due to the soft performance of prime time and the move of the Grammy Awards on CBS from January to February this year. Overall, primetime ad spend dropped 15% compared to January last year.

While the Big 4 were down, Hispanic networks, Telemundo and Univision, showed significant double digit increases The scatter market grew 39% year-on-year, however it wasn’t enough to counteract the fallout from the disappointing upfront market, in which upfront dollars dropped 6% for the month

Here's the funny thing about ad buying

TNT
won primetime in the week of February 9-15. In Adults 18-49 it was followed by AMC, TBS, USA Network and Discovery. In prime viewers TNT was followed by Disney Channel, Fox News Channel, AMC and Discovery. For total day the winner was Disney, followed by Adult Swim, Nickelodeon, FNC and TNT.

TNT doesn't have a splashy trending show on social media, no darling of the critics, but it just keeps chugging along winning pretty much week after week.  One of the things I always stress to clients is frequency over time.  TNT knows this and builds a stable of steady performers, not that they aren't looking for a breakout hit, they just don't need one.
Broadcast nets are always looking for some kind of tent pole show they can build on, but the fragmented model of content viewing has pretty much made that impossible to do,

Slow and steady wins the race!

Looks like AMC has another hit.

After debuting on February 8 as the biggest series premiere in cable history among adults 18-49 based on

Nielsen live/same day ratings, AMC says Better Call Saul is now confirmed as the #1 series premiere in cable history among adults 18-49 and adults 25-54 in live+3 ratings, which include three days of time-shifted viewing. The series’ two-night premiere on February 8 and 9 delivered a combined total of 15.6 million viewers, 9.7 million adults 18-49 and 9.1 million adults 25-54 (live+3). The viewership records were set by just the first half of the two-night premiere, the February 8 telecast, which delivered 9.8 million viewers, 6.1 million adults 18-49 and 5.7 million adults 25-54.

After watching a couple episodes I think BCS has nowhere to go but up. 

The Internet

The Comcast/Time Warner merger has accelerated a fight that has been brewing for quite some time, that of Net Neutrality and who ‘owns’ the internet.  Do the people who laid the wires own it?  Do the people who develop the content own it?   Does anyone own it?

That’s the position the government is trying to take.  The internet is a public utility.  Now the funny thing here is that most people already feel ISPs are monopolies and turning them into public utilities will codify that fear, yet they cheer the fact that the government is turning them into public utilities.

Second funny thing, google ‘antiquated electrical grid’ and see what pops up.  Hundreds and hundreds of articles, studies, and opinions on how the grid is not serviceable for the future and how susceptible it is to failure.  Do you really want to take one the greatest inventions since the wheel and put it into a noncompetitive environment?  How fast will speeds go up when regulations sets the requirements?

Third funny thing.  Most people use the fact that there is paid peering to claim that the ISPs make it harder for small companies to innovate.  In fact, the opposite is true.  Netflix and YouTube account for half the bandwidth usage in the US.  Half.  So does that leave room for the ‘little guy’?  If they use half, figure in Amazon, Hulu, HBOGO, and all the other streaming services which will pop up over the next 12-24 months.  Now how is the ‘little guy’ faring?  The theory is that if ISPs can charge peering to the large corporations, then they can use the profit to expand their bandwidth.  I know, I know, they won’t do that, but that is probably the most effective space for government regulation, which is how much must be dedicated to plant improvement from the peering charges. 

The internet is not a fragile hothouse flower, but a robust weed growing any place it can find the least litte bit of traction.  So be careful what you wish for.

That one thing

Remember in City Slickers when Curly kept telling Billy Crystal about the One thing.  The One Thing was something he had to find for himself and build some sort of Tao around.
Aflac has found  their One Thing which they are spreading in their largest most integrated campaign ever.  Same day pay.  So they are using faster payment processing as their One Thing.

We have always had this in advertising.  We just called it something different, we called it the 'Because' or the unique selling proposition.  In other words, why should someone do business with you.  What unique product or service do you offer that no one else can.

I see lots for creative that has everything but the kitchen sink in them to try to attract a customer.  You've seen it too.  The billboard that has so much writing on it you just glaze of by the time you cruise past at 65.  The radio commercial with the comically fast read because if too much copy.

When you think of advertising you business, remember; what is the ONE THING that I do better than any of my competitors?  What is my because?

Curly would appreciate it.

More Sports

So a couple of questions; if I buy an ad, then it's not seen till 7 days later, do I have to pay less?

Also, sports just keep popping up as nealry bullet proof.


TIVO OWNERS ARE HEAVY TIME-SHIFTERS
Looking at Nielsen data, TiVo says it seems like the 173 million U.S. DVR users are hardly using the devices at all. According the ratings company’s latest Q3 data, DVR users are, on average, watching just 10% of their TV time-delayed. The average TV viewer watched 141 hours 19 minutes of live television a month in Q3 versus just 14 hours and 20 minutes of time-shifted TV. Compared to the average DVR user, though, TiVo owners are really committed to time-shifted viewing, although even TiVo users still mostly watch sports live. And when they do watch a game later they tend not to skip the ads.

According to TiVo’s

State of TV Report Q3 2014, at least a third of TV watched by its DVR subscribers is time-shifted. 44% of broadcast television and 32% of cable television is watched after the initial broadcast. As well, primetime shows are watched time-shifted much more than daytime programs. For example, ABC primetime is watched 53% to the time delayed, while daytime is watched 63% live.

The data also shows that moving to count ads for a full 7 days after initial broadcast (so called C7 ratings) could be very important for certain genres. For example, 10% of the audience for the

CBS show Under the Dome watch in the period from 4 to 7 days after the initial broadcast. Other shows, like Extant and So You Think You Can Dance, see similar patterns, with 9% of the audience watching in the period between 4 and 7 days after broadcast.

TiVo also provides some confirmation that
sports are worth a premium for advertisers. The genre appears to be relatively immune to the allure of ad-skipping. 79% of primetime sports events are viewed live, versus just 29% of drama. Given this data, it’s not surprising that ESPN is one of the least time-shifted cable channels. 80% of people view the channel live during primetime, and 78% at other times. And for those that do watch time-shifted TV, commercial retention is also much better for sports than drama: 70% versus 33%.

Sports! Sports! Sports!

WHY AMERICANS WATCH SPORTS ON TV

Super Bowl Sunday is just a few days away, Americans are getting ready for the ultimate annual shared experience of sports television viewing. For many, though, watching TV sports is more than an occasional thing. When the Harris Poll asked Americans who enjoy watching sports what it is they actually enjoy about the experience, the largest percentage (63%) confirmed that they enjoy watching because of the skill involved. Over half also enjoy the rivalry between teams (57%), teamwork (55%), athleticism (54%), and strategy (51%). Around two out of five sports viewers like to use watching sports as an opportunity for showing team pride (41%), as well as enjoying the social aspect of watching with friends (38%). Meanwhile, roughly three in ten sports viewers enjoy watching sports for reasons such as the family tradition of watching (31%), speed of play (31%), and the camaraderie with other fans (28%). Certain aspects of sports viewership also resonate with some demographics more than with others.
Millennials viewers are more likely than their counterparts in any other generation to appreciate the social aspect of watching with friends (50% vs. 39% Gen Xers, 32% Baby
Boomers, & 20% Matures). Viewers living the in the eastern and western regions of America are more likely than those in the Midwest and South to favor watching sports for the athleticism (60% & 59% vs. 49% each respectively). In addition, the two reasons for watching that appeal more to female viewers than their male counterparts are the social aspects of watching with friends (42% vs. 35%) and the family tradition of watching (37% vs. 26%).

Happy New Year!

Let's look at the trend that will come to define video consumtion this year and for years to come.

ONLINE BOOSTS TV CONTENT VIEWING

People are watching more and more video content online. Also, they’re watching more and more ads—and increasingly they’re watching those ads in TV programming. The data supporting those conclusions are in the

Video Monetization Report Q3 2014 from FreeWheel, the digital ad platform now owned by Comcast. "Wherever you look in digital video, there is overwhelming evidence that it is rapidly maturing and growing into its long-awaited role in the future of television," the report concludes.

Online video may have started with :45 clips of cute kittens, but devices have improved and broadband delivery has improved, so people are now watching longer-form programming on digital devices. Ad views within long-form (20 minutes or more) and live programming rose 41% year-over-year, outpacing the 33%

growth in short-form (five minutes or less) videos. Ad views within live programming shot up 214% YOY, with 82% of live viewing attributed to sports.

In Q3 FreeWheel says authenticated viewing—

TV Everywhere—was up 368% YOY. The quarterly study also found that 64% of authenticated viewing by people using their MVPD paid subscription credentials was on a desktop or laptop computer screen, 22% using an OTT device and 7% each for smartphones and tablets.

A year ago only 14% of long-form and live monetization came from behind an authentication wall, FreeWheel noted. That shot up to 46% in Q3 of 2014. MVPD subscribers are increasingly making use of being able to access their pay TV content on digital devices. Yes, TV Everywhere is taking off.

FreeWheel also found that 56% of authenticated ad viewing in the past quarter involved live programming. Must-have live programming is described in the report as the hook for programmers to "capture and train" TV Everywhere viewers. Once introduced to authenticated viewing they can explore the rich libraries of on-demand programming, which accounted for 44% in Q3.