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dmendyk
dmendyk
7/21/2016 10:10:56 AM
User Rank
Platinum
Digital dilemma
Adi -- It sounds like video content providers are running into the same problem that non-video content providers for the most part still haven't solved -- how to turn a decent profit on the stuff that everyone seems to want but is less than willing to pay for. Digital ads bring in pennies on the dollar compared with last-generation print and broadcast ads. That's been the case for two decades. Meanwhile, users are mightily resistant to paying for content subscriptions that don't represent a perceived significant bargain.

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Adi
Adi
7/21/2016 11:07:57 AM
User Rank
Author
Re: Digital dilemma
@Dennis - I think that's exactly it. Its been the big challenge for all forms of media. The good old days where you had a powerful brand and could just rely on advertising to pay the bills are well behind us. In a million channel universe consumer eyeballs are scattered, and now everyone is scrabbling to grab as many as they can --and monetize them somehow. If you can manage to get a monthly cheque out of your viewers, then you're doing pretty well. But for many, I think it might have to be a mix of 2-3 different models specially as time goes on.

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jbtombes
jbtombes
7/21/2016 1:56:32 PM
User Rank
Platinum
Re: Digital dilemma
@Adi - How's Crackle doing? The Art of More was a good watch, even with ads. Toplined by Dennis Quaid, who plays a real-estate mogul who tries to bully his way into politics. Real star plays an Iraq war vet who somehow gets into the art auction world. On another note: Would you consider low-end niche market video that shares rev with Google ad-supported?

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Adi
Adi
7/22/2016 5:23:31 AM
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Author
Re: Digital dilemma
@jbtombes - Crackle's doing OK, I think. Don't have a sense of their financials or a detailed understanding of their current business state, but they're launching new shows that seem to be getting attention. And they just picked up an Emmy nomination. And yes, I would describe video services using Ad Sense or similar as ad-supported. But would concede that in many cases the revenue might not be enough to actually "support" the service entirely. 

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faryl
faryl
7/24/2016 8:54:42 PM
User Rank
Platinum
Re: Digital dilemma
I think that's where Amazon can have a strong foothold. They already have deep pockets since they're so diversified - plus the immense value of owing AWS. For those cutting the cord, Amazon has the season pass or pay-per-episode model for current network television content, the content included in Prime's VOD, plus the income from video "rental" and/or purchases. Hulu & Netflix's content is limited to whatever each has licensed for their "all-you-can-eat" subscriptions; iTunes has season passes & movies, but (unless it's changed since I last used it) not much "free" content.

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afwriter
afwriter
7/21/2016 10:42:12 AM
User Rank
Platinum
Advertising
I know that Netflix tested comercials in some areas.  I personally would not be opposed to having to watch a 15 second comercial before an entire movie it if helped to keep the costs down. 

Does anyone know if Netflix or Amazon have any product placement deals worked out for their original programming?

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Adi
Adi
7/21/2016 11:10:58 AM
User Rank
Author
Re: Advertising
@afwriter - There was some press around House of Cards product placements a while back. I think Anheuser-Busch gave them free beer initially (!!), but there's actual monetized deals in place. I think samsung maybe, and a couple of others. Fairly limited though -- they are careful not to make it too obvious. 

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dmendyk
dmendyk
7/21/2016 11:30:52 AM
User Rank
Platinum
Re: Advertising
Free Budweiser -- or as it's called this summer, America -- probably isn't enough to keep Kevin Spacey et al engaged. But that's where video may be heading -- pennies on the dollar as far as content value goes. Audience aggregation will continue to be the key differentiator for content companies. But the value of video content is facing the potential for a sharp and painful decline.

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Adi
Adi
7/21/2016 11:37:15 AM
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Author
Re: Advertising
America??!! Really? I thought that was Jeb Bush's gun.

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dmendyk
dmendyk
7/21/2016 11:39:28 AM
User Rank
Platinum
Re: Advertising
http://www.usatoday.com/story/money/nation-now/2016/05/10/budweiser-renames-cans-beer-america-anheuser-busch/84176886/

The good news is, they spelled it right.

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dcawrey
dcawrey
7/25/2016 3:20:01 PM
User Rank
Platinum
Re: Advertising
Sling TV is one that is using both subscription and an ad-based model. I think it is working well for them – they keep adding channels. And the price is low, when compared with a regular cable package. The service is a hybrid between streaming, OTT and regular broadcast. It's a pretty good idea. 

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jbtombes
jbtombes
7/21/2016 1:44:12 PM
User Rank
Platinum
Re: Advertising
@afwriter - Netflix did some work with trailers but Hastings has been adamant about 'no ads.' Amazon has experimented on Prime - but that's what Amazon does, kick things around first. Adi seems correct about Hulu being a hybrid. 

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afwriter
afwriter
7/22/2016 10:39:09 PM
User Rank
Platinum
Re: Advertising
I just saw at Target tonight that they are selling Orange is the New Black on BluRay, so that is one way that Netflix is making money outside of subscriptions.

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elizabethv
elizabethv
7/23/2016 8:58:46 AM
User Rank
Platinum
Re: Advertising
@afwriter - actually putting their original programming on DVD is kind of genius. People who have a subscription have no need for the DVD's (unless they want access away from an internet connection) but others, who refuse to pay for a subscription, but are curious enough to watch the show, will likely be interested in watching in this format. It increases Netflix viewership (indirectly) while catering to a different demographic.

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clrmoney
clrmoney
7/21/2016 11:26:59 AM
User Rank
Platinum
Ott Video Business Model
I'm not sure but I think that have a lot of suscriber would dram more people to your business model or you can come up with another marketing idea for OTT Video.

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elizabethv
elizabethv
7/22/2016 9:56:10 AM
User Rank
Platinum
OTT
To be honest, I'm not much of a fan of Hulu. I've actually considered getting rid of it over the last few months. The only reason we hang on to it is because we have completely cut the cord, and while we do have an antenna, we have zero ability to watch current television on the main networks when the shows actually air. Which means for shows we love, like Modern Family and the Goldbergs, the only option for watching them is Hulu. Though, I do love CBS for having their own streaming service for their shows, and that it is absolutely free of charge. That way I get my Big Bang fix whenever I need it. But I think it's ridiculous that I fork out $8 a month and I'm still subjected to commercials. Such is life I suppose.

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faryl
faryl
7/24/2016 8:59:43 PM
User Rank
Platinum
Re: OTT
Hulu didn't really do a good job of framing what people were buying with the Hulu Plus subscription; people expected more content, but Hulu was really providing licensing to access content across more platforms.

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elizabethv
elizabethv
7/30/2016 10:01:25 AM
User Rank
Platinum
Re: OTT
I'm honestly not sure what Hulu is very good at. Or why people bother with Hulu Plus, other than, like you mentioned, they believed they would gain access to more content.

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faryl
faryl
7/31/2016 10:59:35 AM
User Rank
Platinum
Re: OTT
I don't have cable, so I like Hulu for current shows or full series of other shows. Their movie collection is actually pretty good too. Hulu Plus (which I think is just "Hulu" now?) is the only way to watch Hulu on a roku or Apple TV, which is important to me as a cord cutter. And the upgraded, commercial free Hulu version is worth every extra penny to me to not have to listen to the same 2 commercials every 6 minutes. :) That said, it's probably redundant for someone who already has cable and a DVR. (My mom just uses it when she's on vacation)

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dlr5288
dlr5288
7/31/2016 9:06:23 PM
User Rank
Platinum
Re: OTT
I was considering getting Hulu, but I already have Netflix and cable so I didn't know if it was worth it. I'm happy to hear that you like it so much! I just might have to get it now..

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elizabethv
elizabethv
7/31/2016 11:57:39 PM
User Rank
Platinum
Re: OTT
@faryl - It's interesting to see different perspectives. (And actually why there's value in different OTT services.) I'm a cord cutter too, but I don't have a Roku or Apple TV, so I don't have to rely on Hulu Plus, and I'm still on the original programming package with the constant commercials. Which is fine, their annoying no matter what, but I'm great at tuning them out. I've tried to find movies I want to watch on Hulu, but rarely come up successful. For me, it's Amazon all the way (and occasionally Netflix.) But to each their own. :-) 

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