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Television Businesses Entertainment

Cord-Cutting Pushed To 'Tipping Point' as Video Streaming Grows (bloomberg.com) 78

Posted by msmash from the tussle-continues dept.
The media ecosystem is undergoing a massive change as streaming video looks to extend its recent dominance over traditional distribution, according to research firm MoffettNathanson, which wrote that a large minority of cable consumers could cut their subscriptions in coming years. From a report: "The video market is in full disruption and this year could be the cord cutting tipping point," analyst Michael Nathanson wrote to clients. "Media companies will need to master a whole new suite of skill sets to win going forward," with content creation, user interfaces and "churn mitigation strategies" among the factors that could determine the next generation of winners in the market. Consumers have been abandoning traditional media bundles for years, instead looking to services like Netflix or Walt Disney's recently launched Disney+ service, which has signed up more than 10 million subscribers since launching in November. Streaming services have made in-roads into a number of major categories of video entertainment, including TV shows and movies. In a measure of how big streaming has become, Wells Fargo Securities wrote that between November 17-23, "The Mandalorian," a series from Disney+ set in the "Star Wars" universe, was the "most in-demand show in OTT and overall on a linear+OTT basis." OTT stands for "over the top" content, which bypasses cable boxes. Linear TV airs at set times, as opposed to being on-demand, as with streaming.
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Cord-Cutting Pushed To 'Tipping Point' as Video Streaming Grows More

Cord-Cutting Pushed To 'Tipping Point' as Video Streaming Grows

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  • What's going to happen to advertisements (Score:5, Interesting)

    by rsilvergun ( 571051 ) on Monday December 02, 2019 @04:37PM (#59478082)
    So magazines are basically dead and now TV is next. Web based adverts don't work well. Advertising is still a multi-billion dollar industry and I doubt those folks are going to go quiet into the good night.

    My guess Disney will buy up everything and then once they've got a monopoly they'll start throwing adverts on their streaming service, turning it all back into TV. With the complete lack of anti-trust law enforcement that could work.

    • Re: (Score:1)

      by Anonymous Coward
      Viewing ads will earn you "ad credits" that can be redeemed to view content at a future time. You can view the ads any time you like and your account balance will increase. The system will use the camera on your device to ensure that you are in fact in front of the screen during the advertisement and that your eyes are on the screen as well. You will probably need to watch somewhere around 4 ads to earn enough credit for an hour show.

    • > Web based adverts don't work well.

      110 billion dollars in Google's 2018 advertising revenues says you're wrong. Or rather, as you pointed out, "it's a multi-billion dollar industry", where the winner already has the majority share.

      So yeah, of course Disney, Netflix will slap on ads, just as Youtube already do. The question is, will it still be possible to pay to opt out, or will it go the way TV works today, where you pay for the cable package AND still have to watch ads.

      • Re:What's going to happen to advertisements (Score:5, Interesting)

        by _xeno_ ( 155264 ) on Monday December 02, 2019 @05:40PM (#59478290) Homepage Journal

        110 billion dollars in Google's 2018 advertising revenues says you're wrong.

        "It makes a lot of money" doesn't equal "it works well." Homeopathic "medicine" is a fairly large industry, and it involves selling people sugar pills.

        The problem is that web advertising has an easily measured metric (click-through rates) that correlates to something that they actually want to measure (how much business the ad generated), allowing Google and others to optimize for the metric without actually optimizing for what customers really want. It's a well known, but little discussed issue: a lot of the systems used for targeting ads are effectively over-targeting ads, so that instead of bringing in new business, they're only getting clicks from people who were already interested.

        Online ads are currently in a kind of "bubble" phase. They're new, and a lot of people just sort of assume they work. After all, they have metrics showing click-through rates. But people are starting to realize that high click-through rates don't mean anything if you're just targeting people who already knew about the product and wanted it anyway.

        The few times people have done real A/B tests - where they advertised online in one area but not in another - they've found that the online ads did nothing. It's known that advertising works, but it's entirely possible that the overly targeted online ads of today simply do not work. And it's not just because of ad blockers.

        • that high click-through rates don't mean anything if you're just targeting people who already knew about the product and wanted it anyway.

          Like those little personalized spates of online ads I see for products I have searched for and already bought, or for products I searched for and decided not to buy?

      • Re: (Score:2)

        by Kjella ( 173770 )

        So yeah, of course Disney, Netflix will slap on ads, just as Youtube already do. The question is, will it still be possible to pay to opt out, or will it go the way TV works today, where you pay for the cable package AND still have to watch ads.

        Well unlike broadcast it's easy to have multiple service levels, I have the feeling losing all the people who'll rage quit over ads would lead to a brutal dip in the stock performance that would hurt all the executive bonuses. So even if it would make sense in the long run I very much doubt the totally ad free level will disappear, they might create hybrid subscriptions and drive the no-ad price higher directed at upper middle class and rich people but I don't see it going away. Besides I don't think they w

      • just that they don't work. They may work for branding, e.g. you can throw a Cola or fast food joint's logo at people and they'll get an imprint. But for targeted, directed adverts they're way, way, _way_ less effective than print or TV.

        And to put that in perspective video game magazines didn't go tits up because people weren't buying them, the advertisers pulled their ads because they figured out (thanks to modern data analytics) that they didn't work all that well. Those analytics are still out there,

      • Re: (Score:1)

        by rtb61 ( 674572 )

        You are fucking nuts. The streamers got where they are specifically because no ads. Youtube I skip the ads, flick the video off and on, till it turns up add free. So no ads for streamers except for free streamers and they are fucked because too many ads and unwatchable. Seriously, try to force ads on mean and you'll get abuse in return and instantly dropped service. The same trollish nonsense you are stuck with ads, they will be tatooed on your fucking eyeballs, NO, fuck your ads and show me a fucking ad an

    • If people were shown ads for things they are actually likely to want/need/buy, they might be more likely to watch the ads instead of flipping channels or otherwise trying to skip them...

      I would watch more ads (and probably spend more money) if I was shown ads for things I might actually want and might actually buy instead of ads for crap I would never buy and can't use like life insurance (I have no-one who would be the beneficiary of such insurance), retirement living (I am not old enough to live in a reti

      • Don't count yourself out of those markets...

        life insurance (I have no-one who would be the beneficiary of such insurance)

        A small life insurance policy helps cover funeral costs. Alternatively, it can be used as collateral and enable you to get loans you otherwise couldn't qualify for.

        retirement living (I am not old enough to live in a retirement village),

        While they may be estranged or deceased in your case, two parents are a biological requirement. YOU may not be moving into one in the next 2-5 decades, but being a recognized name is worth it if you start having that conversation with your mom.

        cars (I have no license and no ability to drive a car)

        Not today. You may move somewhere that lacks a good mass tra

      • Comment removed based on user account deletion

        • Exactly, this time of year especially, over half my online purchases are for items purchased for other people. That's why my "targeted ads" for the first three months of next year always include "product suggestions" for women and children I don't live with, and I invariably receive email list spam for hobbies and activities I don't have any interest in personally.

          I thought "deep learning AI" I was supposed to fix those problems.

      • Comment removed based on user account deletion

    • Re: (Score:2)

      by spun ( 1352 )

      I'm going to need a source and clarification on that "web based adverts don't work well" claim. Don't "work well" how? And compared to what? And who, besides yourself, is making this claim?

      • On the other hand, you've got the world's biggest and most successful advertising company making claims that you need their products and services and they work.

        Think about it.

    • Comment removed based on user account deletion
    • It's a common practice, offer a lucrative service, get rid of competition, start to alter the service agreement. It happened with cable (heard the beginning was no commercial interruptions - since it was payed for), the same is now with e.g. Amazon Prime - always greets you with an ad now.

    • My guess Disney will buy up everything and then once they've got a monopoly they'll start throwing adverts on their streaming service, turning it all back into TV. With the complete lack of anti-trust law enforcement that could work.

      That's not Disney's style...

      They'll buy everything up, then start tweaking the characters to maximize their merchandising potential. Everyone wants a Cuddle-Me-Baby-Yoda for Christmas...

    • No doubt. As it is now every other YouTube video I watch has an ad that I can't skip for the first 5 seconds.
      Next year it'll be 10 seconds. A year or two after that, no skipping will be allowed.
      Netflix and Hulu will follow suit.
      When I watch television, 9 times out of 10 if I flip channels, I land on a commercial, not the program. It's getting to where they're all just commercial channels that feature "program breaks".
      Eventually, even people being paid to have advertisements tattoo'd on a visible part of

    • We'll have to wait and see how long before Netflix starts advertising.

      Just ban the visual diarrhea of (commercial) advertising already.

      The world would be a far better place without any commercial advertising, visual eye sores and audio ear sores this crap brings.

  • People are getting rid of cable TV and going 100% streaming via internet CABLE connection. That's not cord cutting.

    • Re: (Score:2)

      by crow ( 16139 )

      In a few years, you can switch to StarLink and drop the cord.

    • Re:How do you get the stream if the cord is cut? (Score:5, Informative)

      by MikeDataLink ( 536925 ) on Monday December 02, 2019 @04:57PM (#59478142) Homepage Journal

      People are getting rid of cable TV and going 100% streaming via internet CABLE connection. That's not cord cutting.

      Yes. It's a saying. Like "kick the bucket." Old words that have new meanings. It used to mean cutting the Cable-TV cord for over the air antenna service. It has since morphed to mean cutting subscription TV service from your local carrier - even if you still get Internet service from them.

      Gay used to mean happy... now it means something entirely different.

    • I ran across someone else who thought the same way as you. They thought "cord-cutting" meant using a cell connection for everything.

      It never meant that. It was always "drop cable TV service in favor of Internet streaming".

      But the big problem here is that cable companies will do everything in their power to make sure that never happens. The only thing that can prevent that is vertical separation of industry.

      • It never meant that. It was always "drop cable TV service in favor of Internet streaming".

        Actually, it just means dropping traditional, paid TV services, which also includes satellite TV. There's no requirement to subscribe to any internet streaming service, and the term was already in common use before such things even existed.

    • Re: (Score:3)

      by spun ( 1352 )

      Don't be pedantic. The phrase does not refer to a literal cord. You, me and everyone else knows exactly what it means: people are canceling cable TV subscriptions.

      The phrase also does not refer to literal cutting of anything, in case you were going to go full pedant and claim that "cord cutting" refers only to the physical cutting of a physical cord.

      • Re: (Score:2)

        by k6mfw ( 1182893 )

        "cord cutting" refers only to the physical cutting of a physical cord.

        Yes, you can cut that coax cable going to your home and not be able to watch cable TV. But Comcast will still send you the $120 monthly bill.

        However, cancelling cable TV and then subscribing to internet from the SAME company can be much cheaper. But for how long till Comcast figured they have a monopoly on high speed internet exception of AT&T (which both probably charge the same price) where eventually that line will cost $120 per month?

    • I hate that stupid phrase. Who comes up with this stuff?

    • The cable companies won't be hurt. But the entire tv broadcast model that had existed since the 1950s is on the way out. Streaming services are the answer, but will they generate enough to produce the level of new content? And just as importantly how exactly will the streaming content producers sell advertising time? It's difficult to see how a streaming subscription is going to generate that level of revenue.

    • This is true. But if you're just using your cable company as an ISP, they are simply a common carrier and there is nothing that differentiates them from any other ISP. Since there is no value added by their content line-up over anyone else, you're more likely to jump ship and be more price sensitive. Also, they're losing out on ad revenues.
  • Not until it actually saves anyone any money. to get all that I want to see or watch, I have to sign up for 3 or 4 services. So where are the savings, though I do like to watch when I want to watch rather than at the broadcast schedule.

    • If you try to replicate everything you have in an expensive cable package you probably won't save money. They way to save money is get an antenna and a DVR for over the air broadcast stations. Then have 1 or maybe 2 streaming services at a time and binge watch what you want. Then switch to another and cycle through the different services. By the time you are through them all the first one should have released some new stuff you want to watch

      • That is my tactic exactly minus the DVR but plus Plex. OTA I have ABC, CBS, NBC, PBD, FOX, and about a dozen other almost worthy independent outlets. I stream Netflix, Amazon (came with prime), and just added Hulu yesterday because they had a Cyber Monday deal at $1.99/mo for a year.

    • So where are the savings

      Well you could pick which media you want to consume when you want it. Have HBO for maybe a month or two, then ditch them. Switch over to Netflix, have them for about a month, then ditch them. Hop over to Hulu, watch what you want there and then ditch them. You don't have to have all the services running all at the same time if you don't want to. Much like you don't have to have all the lights on in your house, if you don't want to. I mean you can if you want, if that's your cup of tea, but it'll get m

    • well binge and switch will always be valid (least until streaming services start slapping contracts etc... to counter it). Spend a month catching up on the hulu shows you care about... cancel, get netflix, binge a month cancel and get amazon prime etc.... admitted it throws you back into a schedule, but more a schedule of months rather than hours of the day.

    • Re: (Score:1)

      by bob4u2c ( 73467 )
      Sling just ran a free Showtime preview with about 5 "different" channels. Many moons ago on cable you were forced to watch whatever was broadcast scheduled, but the preview included a huge catalog of movies and shows you could watch anytime. Now two odd things that struck me. The first was that these channels still had a broadcast stream just like cable, but I thought why would I bother when I can start the movie any time I wanted, why jump into a movie half way? The second odd thing, all 5 channels had

  • The Shtity Part... (Score:5, Insightful)

    by skam240 ( 789197 ) on Monday December 02, 2019 @04:55PM (#59478136)

    The shitty part here is that all of us who fled unreasonable cable fees are now being approached by so many providers for content that the piracy rate will only go up. Mark my words, the twenty-tens were a golden era for entertainment. With every asshole out there trying to charge for their own streaming service media will only become increasingly crappy.

    The scariest part for me currently is Disney's dominance. I won't say that I'm not vaguely entertained by their tripe but I thoroughly agree with Scorsese in that these movies aren't proper cinema. They watch like movies created by committee to maximize appeal among international audiences. There's no art there.

    • Re:The Shtity Part... (Score:5, Insightful)

      by rogoshen1 ( 2922505 ) on Monday December 02, 2019 @05:24PM (#59478220)

      And god forbid they say anything the chinese government doesn't like...

      But yes, exactly. Netflix was great because they were the only game in town for a long while. Most of the content people wanted to watch (from many different providers) was all lumped together in one easy to binge source, with a pretty low price. and it was good.

      The content makers saw this, and became jealous. By trying to carve out their own little fiefdom; they will wind up ruining what made people subscribe to netflix in the first place: everything in one location, without commercials.

      Aggressively minimizing "Money left on the table" is about the most damaging idea in the history of business. But maybe that's their plan; maintain the status quo through sabotage.

      • Netflix was great because they were the only game in town for a long while. Most of the content people wanted to watch (from many different providers) was all lumped together in one easy to binge source, with a pretty low price. and it was good.

        IIRC is was Gabe Newell who is commonly quoted for saying that internet piracy is not a content problem but a service problem. I very much feel like we are approaching those times again.

        Either to avoid advertisers, increasing fees or to get a more convenient library of content; people will once again look to your friendly neighborhood pirate. As the major of platforms will be beyond the price people are willing to pay or be too reprehensible to support financially (Looking at you Disney).

      • But yes, exactly. Netflix was great because they were the only game in town for a long while. Most of the content people wanted to watch (from many different providers) was all lumped together in one easy to binge source, with a pretty low price. and it was good.

        The content makers saw this, and became jealous. By trying to carve out their own little fiefdom; they will wind up ruining what made people subscribe to netflix in the first place: everything in one location, without commercials.

        My current process for a movie/series I want to watch: Check Netflix, check Hulu, check Amazon Prime. If all three are a no, check TPB. Because TPB ALWAYS has it.

    • Re: (Score:1)

      by AmiMoJo ( 196126 )

      The Mandalorian is okay, not amazing. Most of the really great TV from the past couple of decades has been a bit much for Disney's sensibilities. They aren't going to become HBO or the BBC or Netflix so I'm just not sure they can produce enough content to keep adults interested.

      • Re: (Score:1)

        by AmiMoJo ( 196126 )

        Hmm, -1 troll for not liking the Mandalorian. Looks like the toxic fan community has decided it's going to defend that show.

      • Re: (Score:2)

        by skam240 ( 789197 )

        Yeah, the Mandalorian really is just "okay".

        They aren't going to become HBO or the BBC or Netflix so I'm just not sure they can produce enough content to keep adults interested.

        Have you seen their movie's attendance numbers? They are apparently doing a very good job of entertaining a significant percentage of adults.

    • It doesn't matter if there are many providers seeking a fee for content, when you can pay a small fee tone and watch what you want for a month, then move on to another...

      The only reason the Mandalorian is pirated so heavily is that for some insane reason it's not available in every region on Earth from the outset.

      • Re: (Score:2)

        by skam240 ( 789197 )

        Me, personally being able to platform jump is irrelevant to this conversation. I am not at all complaining about personal cost to me.

        Most people continuously maintain 2 or 3 streaming accounts, most people have no patience for platform jumping. The more streaming services that are available the more watered down every players percentage of the total pie will be. This will effect their cash flow which then effects their ability to make new, quality content.

        That, plus Disney's streaming service with it's huge

      • Re: (Score:2)

        by skam240 ( 789197 )

        BTW, I've seen you post about platform jumping probably a half dozen times in the last year or so. You haven't stumbled onto something no one else has thought of. Most people just don't like to be bothered with constantly connecting to a service, binge watching, then disconnecting. Most people enjoy a continual connection to watch at their leisure. It's great you've optimized your costs in terms of streaming but most of us don't care about the minimal monthly fee most of them cost and really don't want to b

  • "It'd be great if we could make them pay for every video they watch, but you know what would be even better? To make them pay for every video regardless of whether or not they actually watch it. Then it doesn't matter whether the videos produced are any good or not, what matters is that they're low-risk investment vehicles. Regardless of their quality, people will pay because they're paying regardless of whether or not they watch it or enjoy it. In this manner, economics can debase an entire civilization's

  • Hey why TF not, Adult Swim goes for the long game, with imports from Korea, etc. And in the sweet spot of weekend midnight will be the show that we missed: MST3K (where we all can participate!)

    Disney disrupted? Not really. We' re looking at all you corporations out to make them beau coup dinerosimply because we decided to cut the cord.

  • Most of the article surprises me not.

    I'm on the edge of my seat wondering about sports streaming. I pay for Sling TV specifically so I can watch the San Jose Sharks hockey team. At $25/month, it's the cheapest option I'm happy with. It's still not the product I'd prefer but it's not bad.

    I'm quite curious which pro sports league will be the first to decide they want to set up their own streaming service and what the terms will be when they negotiate a contract with the networks ("you can broadcast the games

  • There is an alternative (Score:5, Interesting)

    by doubledown00 ( 2767069 ) on Monday December 02, 2019 @06:00PM (#59478336)

    Although no one will ever do it. The solution is compulsory content licensing like what they do with the radio. All content is available to all services on demand at set rates. If you're on Netflix and want a Marvel movie, no problem. Disney licenses the viewing to Netflix behind the scenes. The viewing can be a pay per view cost or it can be bundled into the user's monthly contract with Netflix.

    There is no technical reason this couldn't be done. The problem is the Federal government would have to step in and mandate it......which the content companies as now will never let happen.

    • Although no one will ever do it. The solution is compulsory content licensing like what they do with the radio. All content is available to all services on demand at set rates. If you're on Netflix and want a Marvel movie, no problem. Disney licenses the viewing to Netflix behind the scenes. The viewing can be a pay per view cost or it can be bundled into the user's monthly contract with Netflix.

      There is no technical reason this couldn't be done. The problem is the Federal government would have to step in and mandate it......which the content companies as now will never let happen.

      Technically, US copyright law - as it currently exists - prevents this sort of thing through an interesting violation of the US Bill of Rights.

      The dual rights to ethical practice of law and ethical government can both be asserted under the 9th Amendment as rights 'retained by the people', and under the 10th Amendment as rights 'reserved to the people'. Even the appearance of conflict of interest must be avoided when alternatives exist.

      The current system of complex bundling depends on the long term control

  • If I'm paying $12/mo for some streaming service, no flipping way I'm paying $45+/mo for some shitty local network broadcast with 18 min per hour of commercials.

    • What are you referring to? I get more than a dozen OTA channels for free. But yea, a good third of that is commercials.
  • Just dropping by to remind everyone that free OTA broadcast TV is still a thing. All you need is either an indoor or outdoor antenna ($20 best buy). Going forward, the next OTA digital protocol will be arriving soon and will begin broadcasting in 4K. There will be other improvements as well...
  • The internet is a big place, and locals broadcasting is always free. Cable companies may become a thing of the past in the next 10 years.
  • One problem is that there are many streaming services with various exclusives. If you were to subscribe to enough of them, you may as well be paying a $100/mo cable/dish bill.

    The Streaming businesses will need to find ways to "bundle" for a low price or else lose their exclusives to piracy.
  • as a part of the service.
    Buy into the traditional big movie and series package and get "Apple, Netflix and Amazon" in with the per month deal.

  • How profitable can you be when your customers subscribe for a month or two, watch the exclusives they want, then drop your your service for a tear or two while they move to the next service and do the same there, lather, rinse, repeat?

  • The only reason I have Amazon Prime Video is because there is more to it then just video. Kindle Books, Free Shipping, and Video.

    Other then that, I don't pay for any streaming service or cable contract. I might have to still see Commercials, but I am not paying for the shows I watch. Shoot, here in Cleveland. There is over 40 channels you can watch just over the air. You don't have internet? Just buy a T.V. and antenna, and you have a number of things you can watch.
  • Streaming is dead. Why? Because content sucks. The only interesting content is being banned, and the only content being promoted is endless pablum and repetitive garbage like Katy Perry, trite Netflix movies, and the same old Disney junk.

    • This is false. You seem to have confused "interesting to you" with "interesting". These are in fact not synonyms. The life or death of streaming is only infinitesimally related to whether the content is interesting to you.

      You'll need a lot more than just to opinion if you want to justify a claim that all content that is interesting to anyone is being banned. There is virtually no content that is interesting to 100% of people, and there likely never in history has been. But there is absolutely content on Net

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