1. vMVPDs Are Getting Even More Real

We’ve been big fans of vMVPDs since their inception as they solve so many of TVs issues. They’re available on every device known to man, their interfaces don’t look like they were designed in 1997, and they allow for a wide range of interactive ad units. What’s not to love?

Why It Matters

While vMVPDs were initially billed as “skinny bundles” with the notion they’d be bare bones solutions, their sweet spot seems to be something we’ve been calling “mesomorph bundles” or packages of around 80 to 100 channels selling for around $40-$60/month, depending on whether the user has added cloud DVR or HBO. With some notable exceptions (e.g., Sling doesn’t have a deal with CBS), those 80 to 100 channels include pretty much every channel the viewer has ever heard of, and then some. There are considerable cost savings to vMVPDs (no monthly set top box rental fees) and rather than have to switch between multiple interfaces and multiple devices, you can stick with single device, which often means a single remote control as well.

Probably the best feature of vMVPDs is that they offer the TV Everywhere experience that the industry has not been able to offer, the lack of which very much plays into the whole notion of “Nordstrom prices for Kmart service” that plagues pay TV—for over $100/month, viewers expect to get the same functionality from their MVPD that they do from Netflix, Amazon and Hulu.  vMVPDs deliver on that promise, which greatly improves the overall viewing experience along with customer satisfaction.

As we noted in an article earlier this week, vMVPD viewership is growing rapidly and will continue to grow rapidly over the next few years. Most everyone in the greater ecosystem is starting to realize that initial hesitations around coverage and carriage deals—some of which was technical, some of which was just game playing—doesn’t make any sense. Which is why it was reassuring to see that YouTube TV is finally launching on Roku this week.

Roku is the leading connected device manufacturer, and its lead over Chromecast, Amazon Fire TV and (especially) Apple TV is growing even wider. Since people often purchase a connected device prior to deciding to shift to a vMVPD, the fact that YouTube was not available on Roku likely pushed a number of people towards one of YouTube’s competitors, and so their new Roku app will help level the playing field.

Similarly, we learned that Charter has been quietly pushing out its own vMVPD, Spectrum Watch, and while there are no official numbers out on the number of takers, the company is reporting it gained 2,000 video subscribers this quarter, and sources tell us that number is largely due to Charter counting Watch subs, so there’s definitely been some uptake. They’ve been keeping the release quiet, as it appears to only be available to Spectrum broadband subscribers, so we’ll have a more fully baked opinion of it if and when it goes national.

Because they’re able to to offer double play deals with broadband, we’re feeling good about vMVPDs tied to broadband providers overall, as well as Hulu Live TV because of their Comcast connection, the fact that they’re owned by four major networks and because including the Hulu service makes it a great deal (if you’re a fan of the Hulu service, that is.) 

Final note, (and at the risk of sounding like a broken record) someone who moves from a traditional set top box-based MVPD service to a vMVPD is doing something called “cord shifting.” They are not “cutting the cord” as they are still paying someone (often the same MVPD as before) for the right to watch pay TV. All that’s changing is the delivery method. And the price.

What You Need To Do About It

If you’re an MVPD, continue to promote your vMVPD, start working on one if you don’t have one, and figure out how to keep your profits stable as monthly fees go down and you lose recurring revenue from things like set top box rental.

If you’re a network, remember you’re only hurting yourself by not playing the vMVPD game. As with traditional TV, you want to be on as many systems as possible and in front of as many eyeballs as possible.

If you’re an advertiser, figure out how to take advantage of the advanced advertising and targeting techniques you can find on vMVPDs and try and make sure that ad loads are identical on vMVPDs and MVPDs so we can stop seeing those “advertisement in progress” cards when you haven’t been able to secure digital rights.

2. A National 5G Network?

There have been a number of reports this week (since denied) that President Trump (or someone in his administration) has been considering having the federal government develop its own 5G broadband network.

Why It Matters

A government run 5G network would provide free video-capable internet to everyone, increasing the reach of television and other video-based media. It would also put an end to fears about net neutrality, since a non-profit system would (it seems) not be in a position to charge extra for “fast lane” service or otherwise discriminate between content providers.

While we think that a national 5G system would actually be a great thing for the U.S., as it would give us broadband everywhere, thus increasing innovation and helping to lower the “broadband gap” between our poorer citizens and everyone else, it seems unlikely to happen. Regardless of who is in power, our government isn’t tech savvy enough to actually launch something like this without someone behind the scenes driving it hard and wrangling the necessary votes. Plus, as with many things government-run, it is likely to better in theory than in practice.

What You Need To Do About It

If you’re the hero who can actually make a viable national 5G plan happen, now is the time to step up to the plate.

Otherwise, your best bet is to continue to figure out what you plan to do about the upcoming rollout of 5G broadband from publicly held companies and how it might affect you and your business.