1. Comcast Down, Hulu Live TV and YouTube TV Up

Comcast’s last quarter numbers are in and even with the super snazzy X1 interface, they lost 186K subs for the year and 38K for Q4. Meanwhile, CNBC is reporting that an “unnamed source” has told them that Hulu Live TV now has 450K subscribers and YouTube TV has 300K. Both services were launched this past spring.

Why It Matters

Because vMVPDs are the future of television.

We’ve been telling you this for a while though you don’t need to be a rocket scientist or even a TV analyst to understand why.

Initially marketed as stripped down “skinny bundles”, vMVPDs seem to have found a sweet spot as mesomorphs instead, with somewhere between 80 and 100 channels at a price point somewhere around $40 with some possible extra costs going towards add-ons like cloud DVR and HBO.

What that gets you is pretty much every channel you’ve ever heard of and then some. (There are of course still some lapses, such as the lack of CBS on Sling, but those should be temporary rather than permanent lapses.) 

But wait, there’s more!

For your $40 a month, you also get something that actually looks like TV Everywhere, that mythical beast the MVPDs have been promising since the dawn of the decade. So that when you start a show on a vMVPD on your big screen living room TV and then retire to your bedroom, you can hit pause and then resume watching on your iPad just as soon as you’ve finished brushing your teeth and getting your pillows in place.

That speaks to the whole “Kmart service for Nordstrom prices” thing we’ve been banging on about—that one of pay TV’s big problems is that the antiquated interfaces and user experiences seem pretty Kmart, while the $100+ monthly bills seem pretty Nordstrom—and that disconnect plays a very large part in why people are currently so dissatisfied with set top box based pay TV.

vMVPDs, OTOH, have no such interface problems and actually seem quite fairly priced for what the viewer is getting. Which is why we predict that over the next three to five years they will become the rule, rather than the exception. And that MVPDs, almost all of whom have plans to roll out vMVPDs sometime this year, will begin offering them to their platinum-level set top box customers as a form of TV Everywhere.

One final note: for a while, everyone was all about Comcast and their super snazzy X1 interface as the great white hope. And while Comcast did manage to buck the trend in 2016, adding pay TV subs while everyone else was losing them, and generally making  the whole #ComcastSucks thing yesterday’s news, even a super snazzy interface can’t hold off market forces forever. That said, Comcast’s vMVPD is rolling out this year and they definitely seem to understand the value of a good interface. So don't count them out just yet.

What You Need To Do About It

If you’re a network or network group, you need to get over yourself and strike deals with all the vMVPDs. You’re only biting off your nose to spite your face if you don’t, since this is how people are going to be watching TV down the road. Or to be more blunt: those 2 million people who subscribe to Sling? They don’t all subscribe to CBS All Access or use antennas to pull it in. Something to think about.

If you’re an MVPD, you want to really amp up your vMVPD strategy and marketing plan, and pay extra attention to your interface and user experience, because all those potential subscribers certainly will.

If you’re an advertiser, you want to be all over the advanced advertising units that vMVPDs will allow you to run, everything from addressable units to interactive ones.

Oh, and read Dave Morgan’s piece about why TV advertising is still more effective than digital and why it just needs to find a better may to get that message out.

 

2. Another Specious Study, This Time About Facebook Watch

I’ve gone off before on the number of “studies”  I see that seem to be the media industry’s equivalent of #FakeNews. Either they’re based on a sample of 15 people or there’s something off with their assumptions (e.g., signing up for DirecTV Now is not  “cutting the cord”—you’re still paying AT&T for the ability to watch almost 100 channels of pay TV.)

Why It Matters

Which is why a recent study about Facebook Watch jumped out at me this week when my friend Phil Ranta posted it on LinkedIn. (Phil was skeptical as well.) The study claimed that back in December, back before Facebook started to market Watch in any appreciable fashion, that 40% of all U.S. Facebook users were already watching shows on Watch weekly and 24% were already watching Watch daily.

Yeah … no.

Something is off there. Maybe it’s that they only interviewed 1400 people. Maybe those 1400 people didn’t get that not every video on Facebook was a Facebook Watch video. Hard to say. But I find it really, really, really, really, really, really hard to believe that many people were watching Facebook Watch back in December. As in it would be far easier for me to believe that 40% of all U.S. Facebook users thought that Facebook Watch was Zuckerberg’s answer to the Apple Watch. (That’s not even a joke, it’s something several non-industry types, of varying ages, have actually asked me when I queried them about Facebook Watch.)

What You Need To Do About It

Everyone in the industry, advertisers and the trade press in particular, needs to start questioning all of these reports, making sure that the math is right, that the assumptions are correct, that the sample size is adequate. If a digital publisher wants to call a three-second glance a “view”, then call them out on it, provide an apples-to-apples comparison (e.g., Fox’s famous “the World Series had 12 billion ‘views’” quote.)

It’s easy to get people to click on a “that just can’t be!” headline. Or a “that confirms all of my pre-existing biases!” one.

We can do better.