Then Again...
TDG's Weekly News Wrap & Commentary
|
|
Consumer Reports
releases new research on hidden fees in telecom & cable bills
Précis –
Telecommunications providers “are the worst offender when it comes to charging unexpected or hidden fees” – that is, what they advertise as a monthly price versus what consumers end up paying are vastly different: a 24% surcharge on top of the advertised price. According to CR’s extrapolations, company-imposed fees amount to $37 of the average cable bill of $156, which, in turn, amounts to $28 billion per year in hidden fees.
Download
the report for free.
TDG – For those that have followed MPVDs for even a few years, this is not breaking news. MVPDs have long failed to accurately describe the actual costs of services in their advertising and, according to CR
, it seems to be getting worse. This explains in part why telecom providers generally rank highest on the list of companies that consumers love to hate. But without legal action, either by state/federal authorities or large class action lawsuits, this is unlikely to change. Expect the lack of transparency to continue, and streaming competitors to further leverage this as a differentiator.
|
|
Amazon & Disney face off on ad revenue sharing
Precis –
Amazon wants greater control of ads
shown on Disney apps, but Disney continues to resist. If this is not resolved, not only would Disney+ not appear on Fire TV, but all Disney apps could be removed.
TDG – Fire TV is not currently on the list of supported devices for Disney+, but it could be removed from supporting ALL Disney apps if the two do not come to an amicable agreement. Keep in mind that Fire TV ranks second behind Roku as the largest distributor of streaming TV apps, so this scuffle could have serious consequences for both companies.This especially the case for Disney, which needs the Disney+ service on all popular platforms when it launches in November. However, Disney’s apps are very popular with streamers, and demand for forthcoming Disney+ appears to be substantial, meaning if Amazon doesn’t bend a bit it could be left out of the biggest SVOD app rollout since Netflix. As we’ve said before, the battles between tech platforms and content studios is much like the retrans disrupts between pay-TV operators and creators: these are ultimately resolved, but only after consumers are put through the wringer.
|
|
Behind-the-curve: “Comcast and other ISPs will eventually bundle broadband and streaming video”
Precis – According to
Barclays
, with the arrival of Disney+, HBO Max, Peacock, and other new SVOD services, broadband operators will begin bundling high-speed data services with specific fee-based apps.
TDG – Under what rock have these folks been hiding for the last five years? A bit of history will prove useful. TDG recommended a decade ago that MSOs spend the money to develop proprietary IP-based platforms in order to fend off OTT competitors and own the broadband gateway to the TV. Comcast did just that, investing heavily in the X1 platform. Launched in 2012 and largely misunderstood by analysts, within a few years the platform’s value was undeniable, so much so that other cable operators licensed X1 for their own systems. With the X1 in place, Comcast was the first to embrace Netflix, making it a feature of the X1 app store. At that point, the writing was on the wall. No longer able to dismiss the impact of Netflix and SVOD services, Comcast would bring third-party streaming into the pay-TV ecosystem.
Add to this Comcast's (correct) response to the emerging threat of Pay-TV 3.0 “operators” like Prime Channels and hardware OEMs bundling fee-based apps - i.e., dropping the monthly fee from its Flex service and providing a slightly-watered-down version of X1 (including 4K support and a voice-enabled remote) for free to its broadband-only subscribers. In other words, if the future of TV streaming is in fact Pay-TV 3.0 bundles, Comcast is fully equipped to step into this ring and own it, disrupting or even eliminating the need for third-party streaming devices.
Free Flex will prove difficult for any rational Xfinity broadband-only subscribers to reject, and thus a compelling reason to stay within the branded service ecosystem. As a long-time X1 app store user, I can say without equivocation that each time Comcast adds another service to its app store, it further reduces my use of third-party platforms. As noted last week, Roku and its ilk have taken notice
,
as have their investors
.
For many, this is news. For TDG subscribers, however, this was all but inevitable.
|
|
YouTube TV finally arrives on Amazon Fire TV
Precis – After years of hand wringing, vMVPD provider YouTube TV is
now available
on all Fire TV devices, including smart TVs, boxes, and sticks.
TDG – Negotiations between tech-media are much like those between operators and networks when it comes to retrans, except tech-media firms often (1) own both hardware and services (Fire TV & Prime Video, or YouTube/YouTube TV and Chromecast, for example), meaning your partners are more often than not direct competitors in another vertical, and (2) both partners have very deep pockets and can wait for years, not weeks, to settle. Such are the market conditions in the age of quantum media.
|
|
Tivo introducing Edge DVR, free video streaming service, and a Pay-TV 3.0 marketplace
Precis – Earlier this week,
Tivo introduced
its new Edge DVR and TiVo+, a free ad-support streaming service. Edge features 4K, Dolby Vision HDR, Dolby Atmos (immersive audio), and can either be ordered to support legacy pay-TV service or OTA via an exterior antenna. It also includes 2TB of digital storage.
TDG – The DVR is not inexpensive, with the OTA-enabled Edge costing $350, plus a $7/month service charge. The cable-TV version costs $400, with a $15/month service plan. For those that know TiVo, however, this is to be expected. What is most notable about the new platform is its inclusion of a TiVo-branded AVOD service, TiVo+ (how original). The service was developed in partnership with Xumo, the AVOD provider whose apps are featured on most popular streaming platforms. This sets the stage for TiVo to become a Pay-TV 3.0 operator, at least through its retail devices.
Tivo is simultaneously
testing dynamically-assigned pre-roll ads
for DVR recordings, which is a bit odd given that the company’s reputation was largely built on its ad-skipping capabilities. Users can skip the pre-roll ads if they wish, but then why bother introducing them in the first place—especially if doing so offends your loyal users, which it certainly will? Because Tivo sees advertising as a key part of its future. Unfortunately, their users pay a monthly fee largely because of Tivo's ad-skipping features. Thus, the new emphasis on ad revenue runs contrary to the company’s long-standing ethos. That being said, Tivo was in the red last year, and with the company set to split into two separate entities (one focused on hardware/features/service, the other on licensing IP), leaders are eying a future very different from the company’s past.
|
|
Recent & Upcoming Reports
|
|
Last Chance to join the latest TDG Multi-Client Research
Project!
Demand & Consequences: Assessing Demand for New SVOD Services, App Fatigue, and Toggling
.
For more information about project sponsorship,
|
|
Cogitations
“What experience and history teaches us is that people and governments have never learned anything from history, or acted on principles deduced from it.”
Georg Wilhelm Friedrich Hegel
|
|
|
|
|
|
|
