Lionsgate April 14 said it has formed a multiyear partnership with RocketJump Studios for the creation of movie, television and digital content across multiple channels, including YouTube.
The deal affords Lionsgate access to RocketJump’s upcoming slate of digital content, in-house talent and significant fan base, while enabling RocketJump to utilize Lionsgate’s global marketing prowess.
RocketJump, which creates short-form videos, currently oversees the effects-laden “Video Game High School” Web series — now in its third season. The company claims its properties on YouTube and RocketJump.com have attracted 6.8 million subscribers and nearly a billion views across all platforms.
“This partnership unites two entrepreneurial companies with similar cultures and a shared commitment to build new models for creating and delivering content to the next generation of audiences,” Lionsgate CEO Jon Feltheimer said in a statement.
Since acquiring Summit Entertainment and "The Twilight Saga" film franchise, Lionsgate has doubled down on the teen demo through "The Hunger Games" and "Divergent" franchises. In addition, the mini-major has operates the BeFit fitness channel on YouTube, as well creating original series, “Orange Is the New Black” and “Deadbeat,” for Netflix and Hulu Plus, respectively.
“RocketJump is a bold and innovative platform that expands the breadth and diversity of content we bring to our audiences and extends our storytelling abilities in exciting new directions,” Feltheimer said.
As expected, BSkyB’s planned digital movie store will include DVD (no Blu-ray) as backup to electronic sellthrough purchases.
When launched, the satellite TV operator’s “Buy & Keep” service will offer about 200 titles — most on street date — from 20th Century Fox, Universal Pictures and Warner Bros., among others. The Sky Store currently has about 1,400 titles available for transactional VOD rental.
Titles, which include The Hobbit: The Desolation of Smaug, Turbo, Life of Pi and The Wolverine, will range in price from £13.99 ($23.27) for new releases to £7.99 ($13.30) for catalog.
Sky is the largest commercial pay-TV operator in the United Kingdom, with more than 10 million subscribers. While digital distribution of entertainment is growing in the U.K., consumer adoption and confidence with digital remains low. Including a DVD delivered in the mail with electronic purchases is seen as insurance, according to Nicola Bamford, Sky Store director.
“This hybrid [disc/digital] model is really important,” Bamford told a media event. “Sometimes it’s very easy to think about London and Netflix and all of our streaming services and go, ‘DVDs – why?’ We’ve done a huge amount of consumer research … and time and time again our customers go, ‘Great, I get it, I like the immediacy’ but they also like that peace of mind of having that original DVD as an insurance policy.”
Packaged media generated about £1.4 billion ($859 million) in revenue in the U.K. in 2013 — easily dwarfing EST and subscription streaming.
Ian Lewis, content acquisitions director at Sky Store, said Sky subscribers are huge consumers of entertainment, including representing 50% of all packaged media purchases in the U.K.
“Sky Store’s buy-and-keep proposition really gives our customers the ability to widen their choice in terms of not just what films they want but how and when they watch those films. It also gives an opportunity to bring films into Sky homes even closer to the theatrical releases,” Lewis said.
When Google and Viacom announced they’d come to a legal resolution of their 7-year-old, $1 billion copyright infringement lawsuit, it was more than an end to the respective legal teams’ billable hours.
Google-owned YouTube, which was at the center of the suit, during the course of the litigation expedited development of Content ID, a software program capable of automatically flagging videos suspected of harboring pirated content. That was no small task considering YouTube regularly tops all online video platforms — including more than 159 million unique viewers watching 13.4 billion videos last December, according to comScore.
Specifically, Content ID scans YouTube’s voluminous video archives against a database of more than 25,000 copyright infringement references determined by qualified content holders. The social video platform claims that more than 5,000 content holders use the software.
Unique to the software is the ability of content holders to embed ads on pirated material and generate viewership statistics, or block viewing in select countries and regions.
“When Content ID identifies a match between your video and a file in this database, it applies the policy chosen by the content owner,” YouTube said on the software’s user page.
This type of self-regulated security was at the heart of U.S. District Court Judge Louis Stanton’s 2010 decision, which said safe harbor provisions of the Digital Millennium Copyright Act protected YouTube against user-generated pirated videos. Stanton granted Google’s motion to dismiss the case, pointing out that YouTube worked to remove infringing material “swiftly” once those video clips were discovered.
Indeed, when Viacom confronted YouTube with a mass take-down notice on Feb. 2, 2007 (the date of the lawsuit), of more than 100,000 video clips from properties such as Paramount Pictures, MTV, Nickelodeon and Comedy Central, it did so in 24 hours.
“The present case shows that the DMCA notification regime works efficiently: when … by the next business day YouTube had removed virtually all of them,” Stanton wrote in his ruling.
Viacom appealed the ruling, and the case dragged on.
Interestingly, the House Judiciary Committee March 13 held a hearing to explore whether revisions are needed for “Section 512 of Title 17,” also known as the “Safe Harbor” provision, or DMCA, which was enacted in 1998 — an eternity ago in the digital age.
Considered a non-partisan issue, judiciary chairman Rep. Bob Goodlatte (R-Va.), in opening remarks, said the DMCA enables copyright owners to quickly remove infringing online content, while also allowing good-faith online services to operate without risk of liability for the actions of their users.
Specifically, Goodlatte challenged why copyright owners must be burdened sending voluminous amounts of notices seeking removal of infringing content, followed by an almost immediate reappearance of the same infringing content. He said possible legality of the notices and their impact upon legal doctrines such as fair use and the First Amendment; and increased instances of “outright fraudulent notices” sent with little risk of penalties, represent issues to be addressed.
“Section 512 was the product of balancing a number of interests to resolve various issues to improve the copyright system for all,” Goodlatte said. “As the committee conducts its review of our copyright system, we should keep this consensus model in mind while examining challenges and potential solutions.”
Congressman Jerrold Nadler (D-N.Y.) March 19 told the Association of American Publishers he doubted revisions to the DMCA would occur this year.
Nadler, who is a ranking member on the Congressional Subcommittee on Courts, Intellectual Property and the Internet, addressed publishing concerns surrounding the rights of e-book holders to resell copies in perpetuity. Physical book (and packaged-media) owners have the right to resell items under the First Sale Doctrine. Nadler agreed the current notice and take-down provision isn’t efficient in a rapidly evolving digital world. But changes in Congress don’t happen overnight.
“I don’t think we’re going to do major legislation this year — maybe next year,” he said.
Meanwhile, YouTube in 2012 launched a separate stealth “super flagger” program aimed at identifying hate speech and pornography, among other “community guidelines” in uploaded video content. Potentially offensive material (including terrorist propaganda) is determined by about 200 groups (including government organizations) and individuals specifically contracted by YouTube, according to a Wall Street Journal story on the program.
Viacom properties now regularly stream content on YouTube in exchange for marketing, advertising and incremental revenue opportunities. Years ago, however, such cooperation was a pipe dream, as subscription streaming, electronic sellthrough and transactional VOD were in their infancies. Fear of YouTube becoming the Napster of pirated video content in part prompted Viacom to serve Google with litigation.
“This settlement reflects the growing collaborative dialogue between our two companies on important opportunities, and we look forward to working more closely together,” Viacom and Google said in a joint statement on the settlement.
BSkyB’s pending launch of an electronic sellthrough store reportedly will include packaged media as backup to digital purchases.
The satellite operator’s Sky Store, slated to go live April 1, would include a DVD copy of movies and TV shows purchased electronically, according to Cue Entertainment, which cited sources familiar with the situation.
Cinram would replicate the discs on demand and ship to consumers, a business it currently fulfills for 20th Century Fox Home Entertainment, Universal Pictures UK’s Play.com and e-commerce retailer Argos.co.uk.
The presence of packaged media indicates the Sky Store, at least initially, would not offer UltraViolet functionality — the cloud-based digital locker.
Sky Store director Nicola Bamford and Sky Movies director Ian Lewis will host a media event in London to discuss details of the launch. The launch is hoped to have the same effect Comcast’s digital sellthrough platform bow had last November in the United States. — quickly setting EST records for Universal’s Despicable Me 2 in 2013 and Lionsgate’s The Hunger Games: Catching Fire this year.
“We are really excited about a company the size of Sky coming into the digital market. It is really good at what it does in terms of the way it promotes its business. It can only grow the market as it takes the EST offering to our audience in a simpler fashion through the set-top box,” said John Stanley, managing director, Warner Home Entertainment U.K. and Ireland.
The Sky Store represents the first significant EST competitor to U.K. market leader iTunes. While digital sellthrough of movies and TV shows is in its infancy in the U.S., it is virtually unknown to British consumers.
Indeed, sales of (discounted) packaged media still dominate U.K. home entertainment, with DVD and Blu-ray Disc accounting for £1.4 billion ($840 million) in revenue in 2013.
Including packaged media with a digital purchase could help transition Sky's 10 million subscribers to the concept of EST.
“Anything that makes a service available via one button on the remote is likely to have an impact on physical, but you also could argue that it might attract lapsed buyers of physical or those who can no longer visit Blockbuster,” an unnamed home entertainment executive told Cue.
Amazon has issued select press invites to an April 2 event in New York from Peter Larsen, VP, Kindle, that promises “an update on our video business,” without elaborating.
The summons is typical of the guarded e-commerce behemoth, which has a history of releasing scant — but suggestive — hints online and letting the media ratchet up the speculation.
Indeed, media reports suggest Amazon will announce details of a set-top video device that would focus on gaming, music and video — aiming to take on Apple TV, Rook and Google Chromecast. The trio reportedly have sold nearly a combined 23 million streaming media units.
The device would include access to Amazon Prime Instant Video and Amazon Instant Video, the service’s digital content store.
Amazon’s push comes as Google reportedly is working on an Android-based set-top, and Apple and Comcast are partnering for rebooted Apple TV that would operate on Comcast’s X1 broadband network.
Amazon, through its Lab 126 subsidiary in Sunnyvale, Calif., has been working on the Android-based sub-$300 retail device for some time. The lab is responsible for developing Amazon’s Kindle tablet.
In December, Amazon hosted an invitation-only developer happy hour in Boston to discuss a new product that it claimed “would be even bigger than Kindle.”
During GameStop’s March 27 fiscal call, CEO Paul Raines hinted — without expounding — at pending developments in the digital gaming industry involving third-party distribution.
British cable operator Virgin Media is in discussions with Amazon to include direct access to the e-commerce behemoth’s Prime Instant Video subscription streaming service, CEO Tom Mockridge told a London media event.
While the talks are preliminary, Mockridge envisions including a link to Amazon Prime via Virgin’s TiVo set-top boxes — a strategy it currently employs with Netflix and Spotify music service.
“We are open to Amazon Prime Instant Video and we have talked to them,” Mockridge said March 20 at the Broadcasting Press Guild event. “It’s a recent rebrand for them so they’re working out their position on this.”
The CEO was referring to Amazon’s decision to rename LoveFilm Instant to Amazon Prime.
Last year, Liberty Global (former Starz LLC parent) agreed to acquire Virgin Media and its 5 million subscribers for $16 billion. About 2 million of those subs use TiVo boxes.
While Netflix has about 2 million subscribers in the United Kingdom and Ireland, according to IHS, most Virgin Media subs linking to Netflix via TiVo boxes already subscribe to the SVOD pioneer.
Netflix CEO Reed Hastings has publicly expressed interest in partnering with U.S. cable, satellite and telcom operators as a means of expanding brand awareness while helping MVPDs retain subscribers. Thus far, he’s had no takers.
Mockridge said Virgin’s strategy is to emulate satellite TV operator BSkyB by offering a one-stop programming shop for subscribers, including sports. Sky’s Now TV broadband service offers electronic sellthrough and rental of new release movies, in addition to streaming TV shows and sports.
“We’re the only supplier that really has the capacity you need,” Mockridge told The Guardian. "We have talked to [Amazon and] we are certainly open to it, [but] it takes two to tango.”
British Sky Broadcasting Group, the satellite TV operator in the United Kingdom, is readying an electronic movie sellthrough option for its Sky Store transactional VOD platform, CFO Andrew Griffith said at a media event.
The “buy and keep” option (which hasn’t disclosed pricing) mirrors Comcast’s recent launch of a digital movie store in the United States — the first for a cable operator. Sky’s digital storefront aims to target pay-TV subscribers who typically opt for packaged media when seeking to own new-release movies. Sky Store heretofore only rented new-release and catalog movies.
While sales of DVD and Blu-ray Disc movies in the U.K. are declining, packaged media still dominates home entertainment spending — at about £1.4 billion ($848 million) in 2013, according to IHS. Revenue from digital sales and subscription streaming increased 40% to £621 million ($376 million). The uptick helped the British home entertainment industry realize its first annual revenue gain in five years.
"Having made a strong start in rentals, we think we can go one step further and actually start offering customers the opportunity to purchase movies from us and keep them forever," Griffith told attendees March 18 at The Guardian Changing Media Summit in London. "We think we are extremely well-positioned to enter the market and take share."
Indeed, Sky, which has more than 10 million pay-TV subscribers — 38% of the U.K. market — is also upgrading its interactive menu guide to help subscribers find movies and purchase them.
"It's a big market to go after. If you are going to target a big chunk of a £1.4 billion [disc] marketplace, then we'd expect it to be a material opportunity,” Griffith said.
Add Sony to the growing list of companies greenlighting original episodic content for distribution via proprietary over-the-top video channels.
While Sony Pictures Television is no stranger to creating original content for third parties (“Breaking Bad” for AMC, “The Blacklist for NBC), including Netflix (“House of Cards”), parent Sony Corp. now wants the unit to produce original programming for its PlayStation video game console.
First up is “Powers,” a supernatural detective drama originally developed into a pilot for FX in 2011 starring Jason Patric. The reboot reportedly will be recast going forward.
The move comes as Sony Pictures is upping emphasis on scripted TV programming and downsizing more-costly theatrical productions such as The Amazing Spider-Man 2, which bows May 2. The studio is in the midst of layoffs, including more than 200 employees at its Culver City, Calif. headquarters.
When completed, “Powers” will be available for streaming through the PlayStation Network, which includes more than 30 million PS3 consoles. Sony will distribute the show separately internationally and at retail — a strategy it followed with “Cards,” which included a packaged-media boxed set.
The initiative is separate from a plan by Sony to rollout an OTT video service similar to Netflix, Hulu Plus and Amazon Prime Instant Video.
"It's about having a broad range of broadcast content to replicate the live TV experience," Andrew House, CEO of Sony Computer Entertainment, told The Wall Street Journal.
Indeed, rival Microsoft is launching original scripted programming for the Xbox platform this year, Nancy Tellem, president of Xbox Entertainment Studios, recently said at a media event.
PlayStation Network already offers transactional VOD and digital sellthrough access to proprietary and third-party new-release movies, including Oscar-nominated American Hustle and The Wolf of Wall Street — the latter ahead of its March 25 retail street date.
"It is part of a broad range of services and content already offered on PlayStation," House said.
Google and Viacom March 18 announced they have come to a legal resolution of their 7-year-old $1 billion lawsuit alleging copyright infringement at the former’s YouTube video platform, among other issues.
Terms of the settlement were not disclosed.
“This settlement reflects the growing collaborative dialogue between our two companies on important opportunities, and we look forward to working more closely together,” the companies said in a joint statement.
Indeed, Viacom properties such as Paramount Pictures, MTV and Comedy Central regularly stream content on YouTube in exchange for marketing, advertising and incremental revenue opportunities.
Years ago, such cooperation was a pipe dream, as subscription streaming, electronic sellthrough and transactional VOD were in their infancies. Fear of YouTube becoming the Napster of pirated video content in part prompted Viacom to serve Google with a mass take-down notice on Feb. 2, 2007, ordering it remove 100,000 videos clips (largely user-generated] it said were illegally streamed on YouTube.
Four years ago, a U.S. District Court judge dismissed Viacom’s suit, saying safe harbor provisions of the Digital Millennium Copyright Act (DMCA) protected the social media website. Judge Louis Stanton granted Google’s motion to dismiss the case, pointing out that YouTube worked to remove infringing material “swiftly” once those video clips were discovered.
“The present case shows that the DCMA notification regime works efficiently: when … by the next business day [Feb. 3] YouTube had removed virtually all of them,” Stanton wrote in his ruling.
Viacom appealed the ruling.
The much-awaited March 14 release of the Veronica Mars movie left some fans of the former eponymous TV show it was based on in the dark and upset.
The film adaptation, which features most of the original cast, including lead Kristen Bell, was funded by more than 91,000 backers who pledged a record $5.7 million in 30 days a year ago through a Kickstarter.com campaign launched by "Mars" creator Rob Thomas.
Backers in North America, New Zealand, the United Kingdom and Ireland pledging at least $35 were promised a Digital HD version of the Mars movie, while supporters contributing $50 were also promised a Blu-ray Disc/DVD packaged media combo available later this year. Those digital versions were made available as UltraViolet copies redeemable through Flixster.com, though playable on other UV platforms.
Flixster is owned by Warner Bros., which also distributed Mars in about 290 theaters in select markets. The movie generated an estimated $2 million ticket sales, according to BoxOfficeMojo.com.
Problems arose online when Kickstarter backers — not familiar with UltraViolet — found themselves limited to accessing Mars on Flixster, required to register an UltraViolet account, and then unable to stream the movie.
Consumers purchasing or renting Mars (from $5.99 to $16) at iTunes or Amazon Instant Video, which are not UV compatible, in addition to UV-capable Vudu and CinemaNow, among other services, experienced fewer problems.
“My first and last time using Flixster or Ultraviolet,” Jennifer Gottried fumed on the Mars Kickstarter page.
“I am very disappointed with the so-called digital download,” James Stith wrote. “It should not require a dozen extra steps and another annoying program to watch. Nor should it involve a ‘cloud.’ Total Fail.”
“I want my money back for the digital download that I CAN’T DOWNLOAD!,” added Jeff.
There were also happy crowdsourcing fans of Mars.
"Loved it! Great work Rob, Kristen, and team! I would say I'm happy to get closure, but I'm hoping this isn't the end! Thanks for a great film. Happy to have been a part of this," wrote Evan Rook.
Indeed, RottenTomatoes.com gave Mars a 76% approval rating from critics; 97% by users.
Creator Thomas, in an online statement, apologized for the snafus, but reiterated that digital access to Mars for Kickstarter backers had always been earmarked for Flixster.
“I also know that many of you use iTunes, Amazon or other platforms, and would prefer to claim your digital copies on your favorite service, so we hoped we'd also be able to arrange for more options,” Thomas wrote. “Unfortunately, it just wasn't possible. In the end, Flixster was the best option for getting the digital movie reward out to all of you, worldwide, at the same time.”
Warner said it would issue refunds to Kickstarter backers who bought the movie elsewhere.
"We are, of course, working diligently to ensure that all the Veronica Mars backers have a great experience," a studio representative said in a statement.
Studios are pushing electronic sellthrough of movies, and for good reason. Consumers aren’t rushing to rent movies from their pay-TV service — a trend that has held steady for years, according to a new survey from Digitalsmiths, which is owned by TiVo.
Nearly 73% of 3,140 of consumer respondents (18+ years of age) surveyed in North America in the fourth quarter last year said they have never rented a movie from their cable, satellite or telecommunications provider. Meanwhile, 12.5% said they rent one movie a month; 8.4% rent less than one, and 6.1% said they rent more than two titles.
Indeed, transactional VOD revenue increased less than 2.5% to $551 million in the fourth quarter, according to DEG: The Digital Entertainment Group.
At the height of packaged-media sellthrough, studios — spearheaded by Warner Bros. — began offering transactional VOD access to new releases day-and-date with their packaged-media launch.
“It is a safe assumption that there has not been significant growth in VOD rentals. Pay-TV providers have invested heavily in their VOD efforts in recent years with little evidence of revenue growth,” Digitalsmiths said in their Q4 Digital Trends report.
On the bright side, more than 48% of respondents said it is easier to find a title to rent on their pay-TV operator’s platform. More than 24% said it is not easy to find a title they want to rent.
Digitalsmiths said more than 45% of respondents are using a subscription streaming service such as Hulu or Netflix, which is slightly down from the third quarter. More than 57% are spending between $6 and $11 per month on these services. Netflix is the market leader (39%), with Amazon Prime Instant Video (11.6%) and Hulu (7.7%) being a distant second and third, respectively.
For the first time, Redbox Instant generated 2.6% market penetration, followed by Blockbuster On Demand at 1.6%.
Respondents cited convenience (59.2%), cheaper price (50.1%), ability to watch complete seasons of select TV shows (38.5%), superior selection (35.6%), search functionality (29.6%) and access via portable devices (21.4%) for using SVOD or iVOD services.
Another 29% of respondents said they use rental services such as Redbox kiosks (17.3%), Amazon Instant Video (8.5%) or iTunes (6.4%), spending between $3 and $11 a month on these services. Others include YouTube (Google Play) at 1.5%, Vudu (1.4%), and CinemaNow at 0.7%.
Lionsgate March 11 said The Hunger Games: Catching Fire sold an estimated 3.9 million DVD and Blu-ray Disc units in its first weekend of North American release (launched March 7), and had the biggest digital launch in the mini-major’s history, with opening weekend digital sales increasing nearly 40% over the first "Hunger Games" film.
The digital performance was driven by No. 1 openings on all major digital platforms, including iTunes, Xbox, Amazon, Vudu, Comcast Xfinity, Verizon FiOS, Google Play and Sony Entertainment Network, among others.
Higher-margin Blu-ray titles surged to 50% of all packaged-media sales of Catching Fire in its opening weekend compared with 35% of packaged-media sales of the first "Hunger Games" film.
Santa Monica, Calif.-based Lionsgate opened Catching Fire on nearly 20 digital platforms, including six that have launched since the home entertainment debut of the first "Hunger Games" film in 2012.
“This is a monster opening and a tremendous result for the second film in a franchise, underscoring the enormous momentum of the 'Hunger Games' films,” Ron Schwartz, president and GM of home entertainment sales and distribution, said in a statement. “With strong increases in digital revenue and Blu-ray accounting for 50% of packaged-media sales, the opening weekend performance … is a testament to the strength of the franchise.”
Catching Fire grossed $424 million at the North American theatrical box office, the 10th highest-grossing domestic release of all time, marking the first time that the first two installments of a franchise grossed more than $400 million at the domestic box office. The next two "Hunger Games" films, The Hunger Games: Mockingjay — Part 1 and Part 2, will be released Nov. 21, 2014, and Nov. 20, 2015, respectively.
Netflix’s burgeoning broadband traffic upended existing peering balances to the point that Verizon Communications advocates the subscription streaming pioneer pay it a transit fee for smoother access, CFO Fran Shammo told an investor group.
Speaking March 10 at the Deutsche Bank Media, Internet and Telecom confab in Palm Beach, Fla., Shammo said that when peering points were established among ISP networks, it was agreed that no financial payments would exchange hands so long as the traffic delivered between them was mutually beneficial.
Then along came Netflix, which has in recent years created a broadband sigalert of sorts. The SVOD pioneer routinely accounts for about a third of all broadband traffic during primetime hours — easily dwarfing distant runner-up YouTube, according to Sandvine.
“They never contemplated someone dumping as much volume into the peering point as, say, a Netflix. So what happens is you become out of balance,” Shammo said.
The CFO said Netflix’s broadband traffic demands have caused Verizon, as well as other major ISPs, issues — manifested in curtailed download speeds. As a result, Verizon, Comcast, and others have told Netflix that improving download speeds to its subscribers requires paying for direct access via their networks.
Comcast and Netflix recently agreed to a landmark transit agreement — a pact Verizon and AT&T, among others, hope to emulate.
“I think that is where the [ISP] industry will end up,” Shammo said, adding that a deal with Netflix would be forthcoming.
Separately, the CFO said Verizon has put in place a fully functional over-the-top video platform capable of offering SVOD, broadcast TV and electronic sellthrough — much of it made possible following the acquisition of Intel’s pay-TV platform.
Shammo said Verizon’s joint venture with Outerwall for Redbox Instant (melding SVOD with disc rentals) has highlighted subscription streaming’s benefits and challenges. The CFO said Verizon FiOS is now the fifth-largest “cable” operator in the country, with access to another 100 million eyeballs on wireless devices.
“It has taught us a lot about what it's going to take to become [an] over-the-top [player]. There are a lot of barriers still out there that have to be broken down and obviously the [main] one is the content rights,” he said. “We are preparing ourselves for whatever happens in that ecosystem, we will be able to take advantage of it.”
Dish Networks March 5 announced its Dish Anywhere app, which allows subscribers to watch live and recorded programming on connected and non-connected devices, is now available on Amazon’s Kindle Fire HDX tablet. The app was previously available only on Android and iOS devices.
The satellite TV operator continues to push technology trends as a means of attracting and retaining bundled channel subscribers in an era of subscription streaming.
Through the Dish Anywhere app, Hopper with Sling DVR owners can view live, recorded and VOD content at home or remotely from their smartphones and tablets when connected to either Wi-Fi or a 3G/4G connection.
Additionally, the app gives users the ability to view program guides, set recordings and manage their DVRs. The app also allows users to transfer recorded content from the Hopper to their mobile devices when an Internet connection is not available.
"By offering Dish Anywhere to this new group of tablet owners, we continue to show that we are dedicated to the expanding mobile market by allowing our customers to watch everything, anywhere no matter what mobile device they are using,” Jimshade Chaudhari, director of product management at Dish, said in a statement.
Comcast Feb. 11 announced it signed a distribution agreement with Warner Bros. enabling the cable operator’s Xfinity TV subscribers to purchase and access movies and TV shows on any connected device — often weeks ahead of the packaged-media release.
Cable’s first digital content store is selling Gravity, which earned 10 Academy Award nominations, including Best Actress (Sandra Bullock), Best Director and Best Picture. Other Warner titles becoming available for purchase include: 42, Argo, The Great Gatsby, The Hobbit: An Unexpected Journey, The Lord of the Rings Trilogy, Man of Steel, Pacific Rim, Prisoners, We’re the Millers, The Conjuring, The Following, Getaway, The Hangover Part III and "Veronica Mars."
"Comcast is an excellent partner and its Xfinity TV digital storefront is a terrific outlet for Warner Bros.’ great slate of films and TV shows," Jim Wuthrich, president of the Americas, Warner Bros. Home Entertainment, said in a statement. "We’re very pleased to see Comcast move into digital sales and we look forward to helping them further expand their digital store."
Launched last November with movies from Lionsgate, 20th Century Fox Home Entertainment and Universal Pictures Home Entertainment, the Xfinity On Demand digital store became the first pay-television provider in the country to sell Digital HD (electronic sellthrough) content for download and streaming. The platform quickly became a go-to destination for Digital HD, including becoming the nation’s top-selling outlet for the digital edition of Despicable Me 2 through the Thanksgiving weekend, according to Universal Pictures.
Xfinity On Demand reportedly controls about 15% of the Digital HD market. Digital purchases topped $1.2 billion in revenue in 2013, according to DEG: The Digital Entertainment Group.
“Our Xfinity On Demand platform provides customers with the most current content, where and when they want it, and the incredible success of our digital store and cloud-based digital locker will only continue to grow as we expand the platform,” Michael Schreiber, SVP of content acquisition at Comcast, said in a statement.
Rentrak Corp. Feb. 6 said it is exploring strategic options for its legacy pay-per-transaction (PPT) packaged-media rental business, including selling the division, CEO Bill Livek told analysts during the fiscal call.
The Portland, Ore.-based data tracking company’s PPT business enables independent video rental stores to acquire greater copy depth on select studio new releases by charging on a per-transaction basis. Rentrak, which bases its name on the PPT business, said it expects to generate 7% to 10% revenue growth in home entertainment in the current fiscal year.
Lively said the decision to spin-off the PPT business reflects Rentrak’s increased move toward digital data tracking businesses, coupled with the fact PPT’s largest store-based client — Blockbuster — has ceased operations. PPT’s third-quarter revenue growth was due in part to Warner Home Video’s decision to offer greater selection of new releases on street date to video stores — a move that upped content availability 30%, according to Livek.
“We will not be reporting any revenue from Blockbuster as of Feb. 1,” he said. “Our management team has done a fantastic job of turning our PPT business around this fiscal year. At the same time, given the secular trends in this business … we are actively pursuing strategic options for the PPT business. We believe this business provides significant value for brick-and mortar video stores and we are confident in our ability to find the right option for our home video customers.”
PPT generated $13.1 million in third-quarter (ended Dec. 31) — up 17% from revenue of $11.2 million during the previous-year period. Operating income for the PPT business was $2.1 million compared to net income of $1.5 million a year ago.
CFO David Chemerow said any sale of the PPT business would not include the direct revenue sharing (DRS) business, which he described as a “high margin” segment that measures data collected on all PPT transactions.
Chemerow said he expects PPT revenue to range from $43 million to $46 million in the current fiscal year. That revenue will drop upwards of 25% in the next fiscal year with the loss of Blockbuster and ongoing shrinkage in the home video store footprint, according to the CFO.
“This would result in PPT revenue in the 2015 fiscal year in the range of $33 million to $35 million,” Chemerow said, which includes the elimination of Blockbuster. Operating income would range from $2 million to $3 million.
“Although we have not made a decision on the PPT business, if we do decide to sell it before the end of our fourth quarter (March 31), we believe will be able to treat that business as a discontinued operation [on the books].”
Meanwhile, Rentrak’s “advanced media and information” business, which tracks TV ratings, box office tallies, transactional VOD and electronic sellthrough, saw revenue increase 35% to $18.5 million from $13.7 million in revenue during the previous-year period.
Rentrak narrowed the quarterly loss to $366,000 from $1.8 million last year. Revenue grew 27% to $31.6 million from $24.9 million a year ago.
With the Sochi Winter Olympics slated to begin Feb. 7, NBC is offering viewers 30 minutes of free TV Everywhere access to the two-week long event. Viewers must first download the free NBCOlympics.com app or NBC LiveExtra app to access the content.
TV Everywhere is the multichannel video program distributors' antidote to over-the-top video (such as Netflix) by offering authenticated viewers on-demand access to repurposed content.
NBC plans to make the Winter Games the most technology-savvy event in history with more than 1,000 hours of coverage planned live and on demand across myriad platforms, including mobile phones and tablets.
During the Sochi Olympics, and for the first time in the history of the Winter Games, all competition across all 15 sports, including each medal-winning performance in all 98 events, will be streamed live on NBCOlympics.com and the NBC Sports Live Extra app. The site will also feature exclusive content, real-time results, medal standings, event highlights and analysis, athlete interviews and profiles, and rewinds of all event coverage.
Viewers at first will be able to access Olympic coverage on portable devices free before being prompted to verify subscription to a MVPD operator. On subsequent days, viewers will be prompted to verify subscriptions after five minutes. Verification includes entering a user name and password provided by their MVPD.
NBC is using Ryan Seacrest in an instructional video explaining how the apps work.
"We've tried to make it as easy as possible for the average person," Ron Lamprecht, EVP of digital distribution for NBC Universal, said in a statement.
During the 2012 London Summer Olympics, NBC said almost 10 million portable devices were registered to access content on demand.
“With improved tools, including the multi-day temp pass and more providers offering in-home verification, our goal is for temporary pass to really drive usage and adoption of TV Everywhere in a way that hasn’t ever been done before," Rick Cordella, NBC Sports' SVP for digital distribution, said in a statement.
You On Demand, a New York-based Chinese multiplatform video distribution service, Jan. 30 said it has signed an expanded license deal with Disney Media Distribution.
Under the agreement, You On Demand will make available Disney catalog titles such as Alice in Wonderland and the "Pirates of the Caribbean" movies, as well as Marvel titles, through its subscription streaming service. In addition, new releases such as Thor: The Dark World and Saving Mr. Banks will be available via transactional VOD.
Disney in recent years has upped its profile in China, including involving the communist country’s expansive film industry in Marvel’s Iron-Man 3. Walt Disney, which is building a theme park in Shanghai, last October said it would also open the world’s largest Disney-themed store (53,000 square feet) in nearby Lujiazui.
“This partnership marks the next step in You On Demand's commitment to provide rich and diverse content to customers anytime and anywhere on a wide variety of platforms, including mobile, digital cable, IPTV, over-the-top and online,” Shane McMahon, chairman of You On Demand, said in a statement.
McMahon’s father, Vince, owns and operates World Wresting Entertainment.
With Disney, You On Demand aims to expand its mobile distribution presence in China. In the recently announced distribution agreement with Huawei, You On Demand will add Disney titles via its newly launched mobile app, You Cinema. The App currently comes preloaded on Huawei Mate smartphones. Huawei is the third largest global smartphone manufacturer.
Since overtaking the U.S. last year in shipment volume, China's smartphone market is now the world's largest. Shipments are projected to grow 25% in 2014 to 450 million units from approximately 360 million in 2013, according to market research firm IDC.
The global installed base of TV-centric connected devices surpassed 1 billion units in 2013 and will exceed 2 billion by 2017, driven by smart TVs, IP-enabled STBs, game consoles, Blu-ray Disc players and low cost digital media adapters, according to the latest research from Futuresource Consulting.
TV sales account for 70% of traditional audio visual consumer electronics market value, and smart features and connectivity are the latest in a stream of innovations to sustain the industry, drive replacement demand and encourage consumers to upgrade to the next big thing.
“Forty-four percent of the 225 million TVs shipped worldwide in 2013 offered smart features, and consumers now increasingly expect these enhancements on mid-range as well as high end models,” Jack Wetherill, senior market analyst with Futuresource said in a statement. “By 2017, over 80% of all TV sets sold worldwide will be enabled for online connectivity and smart features. As a result, apps are also an opportunity for manufacturers to differentiate with unique features and content.”
According to the consulting firm, three years ago, less than 30% of people who owned a Smart TV actually connected it to the Internet. This trend has now risen to 68%, with the U.S. leading at a 79% connection rate. Retailers input suggests consumers are attracted to smart features like gesture control and facial recognition, which may be harnessed for networked applications longer term.
“As fixed and mobile broadband both continue to evolve in speed and capacity, alternative service-level infrastructures are being created to reach the huge base of IP devices with on-demand and simulcast content at quality close to, or matching, that of broadcast,” Wetherill said. “Both TV-centric and mobile multimedia IP devices will drive growth in online content distribution, but it is clear that consumers like the personal nature of second screen, and tablets will elevate multiplatform consumption to a whole new level.”
However, despite the rise of over-the-top video and connected devices, the set-top box market remains robust, sustained by a new generation of devices that integrate DVR functionality with broadcast, cable and IP networks to provide easier time-shifting, content searches, navigation and on-demand access to content.
Set-top shipments remain high — 220 million units in 2013, dominated by pay-TV providers who are upgrading to integrate IP services with broadcast content and on-demand functionality via advanced user interfaces.
Game consoles continue to be the most popular TV-centric media player, with both Microsoft and Sony building entertainment content and service partnerships to add value for their networked users. With the recent release of Xbox One and PlayStation 4, games consoles are high volume — 31 million units worldwide in 2013 — and moving into a new cycle, though the overall market is expected to gradually contract from 2015 onwards, according to Futuresource.
“In parallel with all this, ownership of personal multimedia devices has soared from 2.8 billion in 2013, on track to reach 4.4 billion by 2017 as tablets and smartphones become ubiquitous and supplant PCs as alternative viewing platforms,” Wetherill said.
Bitcoin — the peer-to-peer payment system and digital currency — is slowly gaining acceptance among consumers of home entertainment, according to a new report.
A PricewaterhouseCoopers survey found that 38% of 1,000 respondents said they would be interested in using Bitcoin for downloading or streaming TV shows or movies, and 39% said they would be interested in using it for buying movie or sporting event tickets. Another 26% would use the currency for pay-TV services.
Entertainment companies are experimenting with content sales using digital currency. Social gaming company Zynga is accepting Bitcoin in some cases, and the NBA’s Sacramento Kings became the first pro sports team to accept the online currency.
Ben McConnell, managing director of PwC, said studios and distributors could familiarize themselves with Bitcoin as currency on specific releases — both at the theater or at retail.
“They should start thinking about experimenting using Bitcoin in different uses for specific shows, or events for point-of-sale applications,” McConnell said. “Companies could use Bitcoin and compare usage rates with traditional payment systems — especially shows [or products] that have a high technology-leaning audience.”
Shrinking the Cost of Buying a Movie
In 2012, there were 26.2 billion credit card transactions in the United States, spearheaded by Visa, which generated $6.9 trillion in sales volume, according to PwC. American Express charges the highest transaction fee (3.1%), followed by PayPal at 2.9%; Visa, Mastercard and Discover are at 2.7%, among others.
These “swipe” fees, among others, are attached to any packaged media, digital or theatrical transaction when using a credit card.
There were $140 billion in credit card fees (excluding interest) generated by banks and processing firms in 2012. Bitcoin could shrink those fees because it charges no transaction fee; opting instead for $30 monthly subscription fee.
More importantly, digital currency doesn’t require a buyer giving up personal information such as a pin, passcode or social security number to complete a transaction. A Bitcoin transaction entails using a Bitcoin address (which comprises a secret code and assigned mathematical formula) to prove it came from the buyer.
Since a Bitcoin address is anonymous, third parties cannot determine who it belongs to — only that the required funds exist to complete a transaction. All sales are final and there are no chargebacks to businesses.
McConnell said retailers and content holders could benefit using Bitcoin when selling high-volume unit products associated with a special release product or movie.
“Bitcoin could be beneficial to any company in the business of delivering content [over the Internet],” he said.
When Netflix rolled out service in Latin America, it quickly faced challenges from a consumer base unaccustomed to using credit cards over the Internet, among other issues. McConnell said digital currency could simplify the process across international borders.
“Any company that is interested in expanding its global footprint, Bitcoint can be a very natural way to test transaction payment systems in local currencies where credit cards transactions are challenged,” he said.
Steep Learning Curve
PwC points out that while some digital currencies have come and gone (Linden Dollars and QQ coins), Bitcoin has gotten bigger since its introduction in 2009, with the U.S. Department of Justice calling it a legal means of exchange in November.
There were 55,000 Bitcoin transactions per day in 2013, compared with 100 in 2009, according to the report. More than 1,000 brick-and-mortar stores are accepting it, along with 10,000-plus online merchants, including Overstock.com.
That said, the survey found that only 42% of respondents understood how Bitcoin actually works, and only 4% said they were “very interested” in using it. Nearly half said they had either no interest or little interest in using it.
“Despite its advantages, Bitcoin has several hurdles before it becomes mainstream, including an infrastructure of consumer-friendly services, faster transaction processing, on-board lawmakers and a more aware and trusting public,” PwC wrote in the report.