Video streaming service Hulu has reportedly been up for sale for a while now, and according to Noah Kravitz of Read Write Web, the company has a number of suitors:
At least seven suitors are said to be vying for Hulu, which went back on the auction block after previous attempts at a sale and initial public offering both failed. A deal would hinge as much on terms as sheer dollar value, as the length of Hulu’s content licenses - and what control the site’s trio of owners have over content available to subscribers - will be part of any negotiations. Hulu’s days of exclusive rights to popular television content could be drawing to a close as networks see the financial benefit in licensing online rights to multiple players including Amazon, Netflix and YouTube/Google.
The current price for Hulu is rumored to be north of $1 billion, with players Yahoo! and DirectTV reportedly in the lead.
As people are increasingly wanting to consume their entertainment at any time and in any way, content creators are experimenting with ways to deliver it. At paidContent, Laura Hazard Owen writes about an unexpected issue one content provider is facing since taking their product online:
The original idea behind soap operas was that daily episodes would keep viewers hooked and advertisers happy. But few people have time to devote to mid-day TV any more, and as TV viewing shifts online, the model is changing.
It’s been just two and a half weeks weeks since popular soap operas One Life to Live and All My Children were reborn as online-only shows — but production company Prospect Park has already decided to cut back on the number of new episodes released online each week. The change in schedule, the company claims, is due to the fact that viewers are “binge-watching” instead of watching one episode a day, and this makes it too hard for them to keep up.
According to Steven Musil of CNet, YouTube may be getting into the paid subscription game:
YouTube reportedly could launch its paid subscription service for some of its specialist video channels as early as this week.
The a la carte service, which could involve as many as 50 video channels, would allow single channel subscriptions for as little as $1.99 a month, people familiar with the plan tell The Financial Times. YouTube confirmed to CNET in February that it was developing such a service but did not indicate when it would be ready for subscribers.
A paid content platform could give the Google-owned video site another revenue stream while allowing channel operators to finance different content production, such as TV shows and movies, a source said.
Speaking of streaming video, Stuff sat down with Ted Sarandos, Chief Content Officer for Netflix, to talk about the current state of video on demand. During the conversation, Sarandos talks about combatting online piracy:
[W]hen we launch in a territory the Bittorrent traffic drops as the Netflix traffic grows. So I think people do want a great experience and they want access – people are mostly honest. The best way to combat piracy isn’t legislatively or criminally but by giving good options. One of the side effects of growth of content is an expectation to have access to it. You can’t use the internet as a marketing vehicle and then not as a delivery vehicle.
6 billion — yes, billion — which is the number of hours of video YouTube users watch each and every month. From the YouTube blog:
We recently announced that YouTube hit an incredible milestone of 1 billion unique monthly visitors, connecting 15 percent of the planet to the videos they love. And those global fan communities are watching more than 6 billion hours of video each month on YouTube; almost an hour a month for every person on Earth and 50 percent more this year than last.
Via Janko Roettgers of paidContent, streaming service Hulu hit some big numbers during the first quarter of this year:
Hulu now has more than four million paying users subscribing to its Hulu Plus service, and the number of subscribers has doubled since last year. The service also streamed more than one billion videos in the first quarter of 2013, which is another record for Hulu.
Speaking of streaming video, Brad Stone at Bloomberg has the scoop on another big tech player making a big play to get in on the action:
Amazon is making e-readers and tablets and will likely soon introduce a smartphone. As it works to build all types of connected devices, that leaves a natural next step: a television set-top box. The e-commerce giant is planning to introduce a device this fall dedicated to streaming video over the Internet and into its customers’ living rooms, according to three people familiar with the project who aren’t authorized to discuss it.
Amazon’s entry will be just another example of how streaming is the future of TV. All the more reason for more investment in the infrastructure to handle the coming flood of data.
Streaming video is already big and it’s getting bigger. Case in point: The Huffington Post highlights new numbers from BTIG Research:
BTIG Research’s Richard Greenfield crunched the numbers using facts from previous statements from Hastings and came to the conclusion that subscribers are spending more than 87 minutes a day on Netflix streaming. “Netflix is now likely the most watched cable network, essentially in-line with the Disney Channel,” Greenfield said.
According to BTIG, Hasting’s 4 billion number is a global comment, but the majority of streaming subscribers are in the US. Greenfield guessed there were 28 million Netflix Instant stream users in the first quarter of 2014.
According to Netflix, customers have streamed over 4 billion hours worth of content so far. Which just goes to show that consumer habits are shifting dramatically. All the more reason to get the transition to all-IP networks underway.
Via Sue Marek of Fierce Wireless comes a staggering number from Verizon:
Video accounts for 50 percent of Verizon Wireless’ network traffic today and by 2017 the carrier estimates video will make up two-thirds of all traffic over the network. Speaking at the National Association of Broadcasters conference here yesterday, Verizon Communications CEO Lowell McAdam said that the company’s investment in its LTE network is what is making the delivery of that video possible. “With 3G you have video clips but there is buffering. With 4G you can stream video,” he said.
A big shift in TV consumption may be afoot, as Jason Del Rey of Ad Agereports a heavy hitter in the online video space may be launching a pay service:
YouTube is prepping to launch paid subscriptions for individual channels on its video platform in its latest attempt to lure content producers, eyeballs, and advertiser dollars away from traditional TV, according to multiple people familiar with the plans.
On a related note, Nancy Hass of GQsat down with Netflix CEO Reed Hastings and learned about the company’s new foray into original content. Choice quote:
“The goal,” [Netflix chief content officer Ted Sarandos] says, “is to become HBO faster than HBO can become us.”
To Netflix, its Open Connect content delivery network program is an all-around win: By caching frequently accessed (and high bit rate) video in ISPs’ data centers, Netflix saves money on CDN costs; ISPs can cut upstream bandwidth utilization; and end users get a better streaming experience.
Netflix argues that this just makes the Internet better for everyone, and doesn’t cost ISPs a dime since Netflix is footing the bill to install the CDN caches anywhere the providers want.
But some ISPs are chafing at Netflix’s offer. Time Warner Cable has gone on record to complain that it’s unfair for Netflix to hold back “super HD” and 3D content unless a broadband provider plays ball and opens its doors for Netflix’s servers.
Spangler argues Netflix’s actions are anti-competitive, since the company is essentially demanding ISPs cut them a special deal. It also restricts content from certain consumers. As Fred Campbell of the Communications Liberty and Innovation Project (or CLIP), writes:
With its “Open Connect” model, Netflix is withholding content from the customers of ISPs that decline to accede to its demands. Though the details of its demands are unknown, it appears Netflix is requiring that ISPs “peer” with them or pay for the installation of Netflix equipment inside their networks as well as the ongoing costs of operating that equipment.
Like Spangler, Campbell also sees this as a move to reduce competition in the market, especially given Netflix’s increased clout through a recent deal it cut with major content providers:
Netflix recently announced a new multi-year licensing agreement that makes it the “exclusive American subscription TV service for first run live-action and animated features from the Walt Disney Studios.” In addition to Disney-branded content (e.g., The Lion King), the deal includes content produced by Pixar (e.g., Brave), Lucasfilm (e.g., Star Wars), and Marvel (e.g., The Avengers). Netflix also announced a multi-year deal with Turner Broadcasting and Warner Bros. that includes the Cartoon Network and exclusive distribution rights to TNT’s television series Dallas. As an analyst recently told Ars Technica, “These movies, if you’ve got young kids—you’ve got to have Netflix.”
Barring some sort of advanced technological breakthrough — say, content beamed directly into our heads — streaming video is the future of entertainment. That makes this latest maneuver by Netflix worth paying attention to. As Campbell points out:
Unfortunately, most consumers won’t realize that Netflix is trying to impose its costs on all Internet consumers to gain an anticompetitive price advantage against its over-the-top competitors.
At CNet, Don Reisinger highlights a new report showing the effect streaming video service Netflix has on America’s Internet traffic:
Netflix users are turning into the biggest data hogs in North America, a new report suggests.
The report from Sandvine, a company that sells Internet traffic-management systems, finds that Netflix use accounts for 33 percent of all downstream traffic in North America during the peak hours between 9 p.m. and 12 a.m. By contrast, Amazon and Hulu only account for 1.8 percent and 1.4 percent of downstream traffic, respectively.
Via Janki Roettgers of GigaOm comes some startling new information about how people viewed the recently concluded Olympic games:
The average [Comcast] Xfinity customer who viewed live streams of the the games online authenticated 2.4 devices. It’s worth noting that this is in addition to millions of TV screens used to watch the London games; those 2.4 devices are just mobile phones, tablets and PCs. In other words: Millions of people used not one or two, but three to four screens to watch the Olympics!
Roettgers goes on to compile other stats, such as 1/3 of the BBC’s online coverage was watched on mobile phones; 60% of visits to the official website of the games were from smartphones; and close to 500 million people in China watched the games online.
More proof that we’re truly turning into a mobile world.
Jake Coyle of the Associated Press (via The Huffington Post) highlights a new report from Pew that finds streaming service YouTube is graduating from goofy videos to a source for news:
[Pew’s report] found that while viewership for TV news still easily outpaces those consuming news on YouTube, the video-sharing site is a growing digital environment where professional journalism mingles with citizen content.
“There’s a new form of video journalism on this platform,” said Amy Mitchell, deputy director of the Pew Research Center’s Project for Excellence in Journalism. “It’s a form in which the relationship between news organizations and citizens is more dynamic and more multiverse than we’ve seen in most other platforms before.”
A new report from Sandvine looks at the effect video and real-time entertainment traffic is having on America’s mobile networks — and hammers home the need for both more spectrum and ongoing investment in wireless networks. Some highlights:
• YouTube is the largest source of mobile video traffic in every region examined, accounting for as much as 25% of network data and no less than 12%
• In North America, video and audio streaming make up more than half of mobile data traffic, led by YouTube, Pandora and Netflix
• Audio and video streaming will exceed 60% of North America’s mobile data by late 2014
• Click-to-cloud smartphone photo back-up and synchronization will emerge as a significant source of traffic worldwide: the phenomena of the continuous cloud/client connection
• In conjunction with the report, Sandvine released this short video on YouTube. Check it out.
Beginning a few years ago, every game of the NCAA Men’s Basketball Tournament — also known as March Madness — has been streamed online. Last year alone, 13.7 million hours of streaming games were watched. And with more and more people embracing online video each day, this year’s total number of hours is expected to be even bigger.
The question we had was, How much bigger? So we decided to crunch some numbers and come up with a prediction for total hours of streaming during this year’s tournament. The total we came up with: a whopping 17,786,648 hours, or the equivalent of nearly nine million movies. Will we be right on the money? Probably not. But it will be fun to find out.
You can follow our progress throughout the tournament, and view our methodology, here. Enjoy March Madness!
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