Category

Video

People watch more video on tablets than desktop

By | Advertising, Mobile, Video | 2 Comments

I was going through my unread saves on Instapaper today and  came to this interesting chart in a Techcrunch post from earlier this month.  It shows people stay watching videos much longer on tablets and mobile than they do on desktops. Maybe not surprising in theory – but look at the extent of the difference – people are twice as likely to watch to one quarter or three quarters of the way through.

The first implication is that as tablets and mobiles continue to improve and take time and attention away from desktops and laptops video views will continue to soar.  This is good news for over-the-top TV plays and the mobile advertising ecosystem.

The second implication is that other apps and services will likely see the similar boosts in mobile usage.  Services that are ‘built for mobile from the ground up’ have been in vogue now (see Jim Breyer’s comments in this series of interviews on Techcrunch), and this tells us why.

Other interesting data in the Techcrunch post is that video plays on connected TVs tripled in Q3 and that the Android-iOS split of mobile video plays is approximately equal.

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Netflix now available on 200 devices and thinking about a post API strategy

By | Video | 2 Comments

Netflix’s movie and TV streaming service is now available on over 200 different devices – mostly TVs, Blue-ray players and games consoles.  I think there is a lesson here for media distribution businesses in the digital age – Netflix has been hugely successful in large part because they have made it dead easy for customers to access their content, and that means being available on devices they already own.

Most devices access the service via Netflix’s API, and the second lesson is that having a good, flexible and evolvoing/improving API is key to making it easy and attractive for device manufacturers to embed your service (probably second only to having a fantastic service in the first place).

In the video below Mike Hart, Netflix’s Director of Engineering talks about how they launched and developed their API and a lot of the thinking behind it.  At the end he starts talking about HTML5, and how their service is now available on the iPhone and some games devices as an HTML5 app, which allows them to AB test, monitor usage and iterate to improve the service in ways that simply aren’t possible over the API. 

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Netflix launches $7.99 unlimited online service, spends more online than offline

By | IPTV, TV, Video | No Comments

Netflix is at what might be looked back on as a watershed moment in the company’s history.  On Monday they announced a $7.99 all you can eat download service for movies and television and according to the New York Times they are expecting that the cost of streaming movies will pass the cost of shipping DVDs for the first time this holiday season.

Of perhaps equal significance at the industry level, for the first time cable television subscriptions have fallen for two quarters in a row.  Welcome to over the top television.

On the back of this the stock market has sent Netflix’s shares up fourfold since January, and the company is now valued at $10bn.

The studios are now (of course) waking up to the power of streaming video and want in on the action, either via charging Netflix more for their content or by launching their own services.

Here in Europe the market is a little way behind, but we are catching up, and as of earlier this month movies from our portfolio company Lovefilm is now on the PS3.

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Music artists are making more money than ever

By | Music, Video | 2 Comments

image This chart (originally in the UK Times and I found it on Hypebot) shows two things.  Firstly, and unsurprisingly, recorded music revenues are shrinking both for labels and artists, and revenues from live performances are rising.  Secondly, and this is the surprising bit, for artists the growth in income from live music is outstripping the decline in revenues from recorded music, meaning that they are actually better off, at least since 2004.

The one question about this data, as discussed in this hypebot piece, is whether the top artists are taking nearly all the live revenues and all the other artists aren’t moving forward at all.  My intuition is that the market for live music is growing for all types of artists.

This is another example of a story we have seen elsewhere on the internet of middlemen getting cut out of a market leaving other participants better off even as the market shrinks over all.  In the music industry record labels are the middlemen.  If we think about TV and film, the equivalent middleman companies are traditional broadcasters and maybe the Hollywood studios.  I wonder if in a few years we will see a chart similar to this one with their revenues declining.

Of course live performances won’t compensate for lost programme/movie sales in the same way for TV and film as it has for the music industry.  Instead I suspect the industry will find new blends of advertising, pay per view, and subscription models which allow the more efficient channelling of cash from viewers to producers.

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What TV can learn from the move to digital music

By | Music, TV, Video | 7 Comments

Last week I wrote that the latest online video stats show that longform content is doing well, and in response Alan Patrick pointed me to a presentation on his blog entitled The Future of Online Video – Emerging Hypotheses which contained the following chart:

It is a great presentation overall (if you like this brief version Alan tells me the longer version will go on sale soon) and I was particularly struck by chart above and the way it sets out the logical sequence of events.  Looking at the history of the music industry I think you can see a similar pattern of development – but perhaps five years ahead.

Later in the presentation that this slide is drawn from Alan characterises the current situation in TV as “old order being crushed by the free economics of the pirate services”.  That was the situation in music maybe 5-8 years ago, and more recently the pirates have been crushed in a pincer movement between legal pressure on the one side (with the closure of Napster in July 2001 probably marking the beginning of the end) and the increasing availability of what Alan would characterise as legal new order services on the other side.

The last twelve months has seen a slew of ‘new order’ music services achieving some decent success – in no particular order I would list Spotify, We7, Nokia Comes With Music, Imeem and Myspace, and then there is of course iTunes which last week broke definitively with the old order by announcing they would now stock DRM free tracks from all four major labels.

Timing is everything in venture capital and startupland.  The key to success is setting up your business in time to be ready to ride the wave of growth in your chosen industry. 

So I like this chart for what it tells us about how we should time investment into the online video space.  And remember being too early is often as bad as being too late.

The search and discovery opportunity for long form video

By | TV, Video | 19 Comments

Last week I wrote about the success that long form content is enjoying online and posited that as this market starts to go mainstream there will be a requirement for new search and discovery tools. 

I have always thought that future search and discovery services will take one of two forms – a centralised portal where content is both discovered for and searched, e.g. everything ends up on Hulu – or a TV vertical search service. 

Contrary to many observers my hunch is that the latter is the more likely, and reading today about CBS Trying to Out-Hulu Hulu with TV.com and the complexity of Viacom’s online presence strengthens that feeling.  The following is an excerpt from the NewTeeVee CBS/Hulu post :

TV.com has a leg up on Hulu when it comes to CBS content, because TV.com already has Hulu content and Hulu has no reciprocal deal for CBS shows. But let’s not get too lost in those details. Parsing out which site has full episodes of which shows is an all-too complicated task for viewers and reviewers alike (see, for instance, our recent run-down of Viacom’s shows’ availability online). Networks and studios give different sites different deals — they have different selections of shows, different amounts of the most recent episodes, sometimes just clips instead of full episodes…yuck.

Moreover, I suspect the mess will get more complicated as more TV becomes available online and all of the major content owners try and muscle in on the action.  The only way through that complexity will be some kind of vertical search facility. 

Vertical search in TV will look different to other verticals because of the importance of social data in deciding what we want to watch.  On top of the core functionality of being able to search by the name of the programme I want to watch I am also likely to want to know what my friends have been watching and what my favourite pundits are recommending.  All of these need to work across content from different producers.

Online video stats – long form content is doing well

By | Content, Google, IPTV, TV, Video | 10 Comments

Novermber 2008 data just out from Comscore and reported by NewTeeVee and Broadstuff, amongst others, shows that in the US online video consumption was up 34% from Nov 07-Nov 08 at 12.7bn video views.  The number of unique viewers grew at only 6% to 98m – roughly flat as a percentage of the US internet population.  The November Comscore 2007 data is here.

To my mind these are decent, but not fantastic growth figures (although Google’s increase in market share from 31% to 40% by share of videos is impressive).

More interesting is that hidden in these stats is evidednce that consumption of long form content is starting to grow quickly.  The following leapt out for me:

  • Hulu came from nowhere in November 2007 to sixth in the rankings in November 2008
  • The length of the average video rose from to 2.8 to 3.1 minutes
  • It looks like Hulu drove most of the increase as the average length of their videos was 11.9 minutes

As long form professionally produced video starts to go mainstream other ancillliary opportunities will open up – most notably around search and discovery.

Regulator rules that Kangaroo will restrict competition

By | IPTV, PCTV, Video | No Comments

Tim Bradshaw has a good article in the FT today describing the regulators ruling that Project Kangaroo as currently envisaged will restrict competition in the provision of TV online in the UK.

The issue is that ITV, Channel 4 and Channel 5, the owners of the Kangaroo joint venture, control too much of the UKs television production and allowing them to collaborate on distribution would make it too difficult for other online video services to compete.

Read the FT article for the details of how it works and proposed ways through this impasse, but the interesting thing for me is that this ruling should help people break from the old broadcast paradigm.  Kangaroo is in many ways trying to recreate the old world when search and discovery was limited to flicking through the channels or buying a newspaper.

The potential of the internet is to offer radically new forms of search and discovery – starting with a simple search box that allows you to search by programme name through to socially driven recommendations and editors playlists.  I think this ruling will help get us there.

Strategy decay in the film industry

By | Casual Games, Consumer Internet, Video | 9 Comments

At the Library House Mediatech conference yesterday there was a presentation from a company called Slingshot Studios which could be described as a ‘Film2.0 business’.

They described how Hollywood has chased up film budgets to an average of $70m on production and a further $50m for distribution by focusing on the very limited strategy of having big stars and getting great reviews.  I’m sure these are drivers of film success, but to what extent I’m not sure – other harder to control variables like quality of plot and dialogue might turn out to be more important. 

It is a common strategic error to focus on the levers of a business that are easy to control and ignore the ones that are more difficult, even if they would have more impact.

The Slingshot guys also made the point that Gen Y’ers care less about stars and reviews than the rest of us, so the market is moving against the Hollywood strategy.

I buy all of this, and see the periodic huge success of low budget movies like My Big Fat Greek Wedding as evidence.

Slingshot describes itself as ‘an all-digital, British film company that is dedicated to making good films, differently’.  They have released six films, with seven more in the works.  I’m not sure what the budgets are, but given they are VC rather than hedge fund backed I’d be surprised if they were more than a small fraction of the Hollywood averages.

This trend towards bigger budgets based on more of the same across a couple of key dimensions has parallels in the game industry where console manufacturers have chased up budgets to similar levels by focusing on better and better graphics and ever more intricate and involved game play.  This created a large opening for casual games which had much simpler game play, less sophisticated graphics and were much cheaper.  Maybe something similar will happen in the film industry.

From LibraryHouse Mediatech presentation by startup Slingshot.

Average Hollywood film costs $70m to produce and a further $50m

Recognise themselves in the films not caring about stars or reviews

Film industry has been chasing its budgets up in pursuit of always doing better with an established formula – stars, often special effects etc.  Just like hardcore games – opportunity is for equivalent casual games

Slingshot movies are cheap and focus on what research shows works