1. Comcast Partners With Amazon
Comcast dropped another bombshell on the industry last week, announcing that it would be partnering with Amazon to integrate Amazon Prime into its X1 set top box. Comcast already has Netflix integration on X1.
Why It Matters
This deal has allegedly been baking for some time and one of the more interesting aspects is that Amazon will be continue to sell subscriptions to other OTT channels (including Showtime) via its Amazon Channels product. So while Comcast customers can subscribe to Netflix via Comcast, paying for everything on a single bill, they’ll need to sign up for Amazon via the Amazon site.
The piece to watch here is whether Comcast is passing on viewership data to Amazon and whether that’s a two-way street—if Amazon, upon receiving said data, repays the favor by passing data about those users’ purchasing habits back to Comcast for better ad targeting by Comcast and (maybe) NBCU.
A year ago, we would have thought this quite likely, but with today’s spotlight on privacy issues it’s far from a slam dunk.
The deal is also notable because once again Comcast is doing something every MVPD should be doing, long before any of them are actually doing it. Most OTT viewing is additive, e.g., users get it in addition to, rather than instead of, some sort of pay TV service, and so making it easy for customers to stay on the same device when they’re watching Netflix and Amazon creates more stickiness for Comcast, along with a strong possibility that someone will go from Netflix to NBC to Discovery in the course of an evening, given that they don’t need to leave the X1 interface to do so, thus making Comcast a better home for all those networks.
On a related note, we’ve been wondering when Comcast is going to launch its own vMVPD, which would allow it to reach customers beyond its broadband footprint—and we’re thinking that the appearance of an X1 app for Roku is a sign that Comcast is about to do just that.
They’d be pretty foolish not to, given how well regarded X1 is and how none of their potential competitors have Netflix or Amazon integration.
But MVPDs and logic are not always on the best of terms, so we’ll see.
The other interesting piece here is that Amazon gets to keep its Channels product and is thus able to continue selling subscriptions that Comcast would otherwise have sold and make a commission on (e.g., Showtime.) Our gut is that Comcast did the math and figured the amount they’d make having Amazon on board was greater than the amount they’d lose by not being able to sell Showtime and so the deal was struck.
What You Need To Do About It
If you’re an MVPD, you’ll want to emulate Comcast. Stop seeing Netflix and Amazon as your mortal enemy—they’re additive not replacements for your service—and remember the old adage about keeping your friends close and your enemies closer. Plus your subscribers will be very happy and they might start thinking of you as less evil.
If you’re keeping score, watch to see if and when Comcast launches X1 as a vMVPD and if any of the other MVPDs go down that path. Altice and Verizon have said they are open to partnering with vMVPDs, but it seems curious they would not build out their own services.
FuboTV is an obvious choice, especially for acquisition, as they are an independent startup. Sony Playstation Vue is ripe for the picking as well, given that Sony seems to have abandoned the platform. And there’s always YouTube TV, though we’re not sure if anyone would want to let the Google fox into their henhouse.
2. Hulu Is Working With ComScore On CrossScreen Measurement
As more and more TV viewing becomes non-linear, shows, and the ads that appear on them, are being watched on a variety of devices. Someone may start off in their living room watching with the family, but then finish up on their iPad or Fire tablet in bed at night. That’s lead to confusion around cross-screen viewing measurement, something new comScore CEO Bryan Wiener discovered when he took over earlier this year and began surveying customers about their pain points. The result is the new Campaign Ratings tool, which will measure viewing across multiple platforms, looking to deduplicate results and identify individual users. ABC, CBS, Fox, CW and Freeform, as well as some NBCU, Turner and Viacom networks will be part of the beta, which will begin this fall.
Why It Matters
Hulu, which is working with comScore to power the new tool, sees 78% of its viewing happening on TV sets, 9% on desktops and 13% on mobile. So it’s important for them (and everyone else in the industry) to be able to accurately track viewers on digital and on TV and then get deduplicated results—all too often viewers were being counted twice because TV and digital were siloed and there was no way to see which viewers were on both lists.
The ultimate goal here is for networks to be able to offer cross-screen buys to advertisers, to say “here, we can get you this same viewer on TV and on mobile and on desktop, all on the same high quality programming that’s free of traditional digital’s brand safety issues and fraud issues and bot issues—and you can be sure you’re not going to be charged for the same viewer twice.”
That’s huge and it’s good to see comScore in the race—they are going to be competing with Nielsen’ DAR product on this and one of the main complaints about Nielsen is that their complete dominance in the space prevented them from reacting as quickly as they should have to the massive changes in viewing habits, so competition will be to everyone’s benefit.
At present, comScore is getting its data from set top boxes (the Rentrak business it acquired) and from its core digital business. It would be great to see them add in ACR data (you can read our TV[R]EV report about ACR here) in order to round out that mix.
What You Need To Do About It
If you’re a network, and you’re not on the beta test list, you should try and get in on the next round—cross screen is where everything is heading and you want to be a part of it.
If you’re an advertiser, you want to keep a close eye on comScore’s Campaign Ratings and Nielsen’s DAR and use them to plan cross screen buys. Television is still the best way to put high production value commercials in a brand safe environment that feels big and important. Throw in the ability to target consumers watching on various devices and the (upcoming) ability to use data to target them more specifically (addressable) and you’ve got a win all around.