Pay-TV Research Pioneer Paul Kagan Dies

Paul Kagan, whose Carmel. Calif.-based cable TV research firm, Paul Kagan & Associates, morphed into one of the industry’s top analysis companies, has died at the age of 82. Kagan’s family, in an online obituary, announced his passing on Aug. 23 of kidney failure.

Kagan devised ways to value pay-TV operators and media companies beyond their profit-and-loss statements. His company at one time published 38 newsletters and held myriad industry confabs annually. In 2000, Kagan sold his firm to Primedia, launching PK Worldwide Media. MCG Capital subsequently acquired the company, renaming it Kagan Research LLC. It was later sold to SNL Financial and renamed Kagan, a unit of S&P Global Market Intelligence. Kagan was named to The Cable Center Hall of Fame in 2011.

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Report: OTT Revenue to Grow to $44.2 Billion in 2022

Convergence Research estimates U.S. OTT access revenue grew 35% to $22 billion in 2019 and forecasts 29% growth to $28.5 billion for 2020 and $44.2 billion for 2022.

That’s based on 77 OTT services (more than 50 providers) led by Netflix, Hulu and Amazon analyzed in its 2020 Couch Potato Reports. The forecast assumes the coronavirus will not be as major a disruptive force beyond 2020.

Given the accelerating decline in TV subscribers, revenue, and the ongoing programming cost and TV access price increases, TV advertising revenue has also started to decline, according to Convergence. The firm estimates 2019 U.S. cable, satellite, telco TV access revenue declined 3% to $100.4 billion and forecasts a decline of 6% to $94.8 billion in 2020 and higher percentage declines in 2021 and 2022.

Convergence estimates 2019 saw a decline of 6.36 million U.S. TV subscribers, 2018 a decline of 4.03 million, and forecasts a decline of 7.1 million TV subs in 2020. U.S. TV subscribers declined by more than 7% in 2019 and more than 4% in 2018, according to Convergence, which forecasts a 9% decline in 2020 and higher percentage declines in 2021 and 2022.

As of the end of 2019, the firm estimates more than 36% of U.S. households did not have a TV subscription with a cable, satellite or telco TV access provider, up from 31% at the end of 2018. Convergence forecasts 42% at the end of 2020 and 54% at the end of 2022.

The firm estimates 2019 saw more than 7.2 million U.S. cord-cutter/never household additions.

From the end of 2019 to the end of 2025, Convergence sees a decline of more than 50% of U.S. TV subscribers, more than 40% of annual TV access revenue, while cord-cutter/never households and OTT access revenue more than double, with OTT access revenue surpassing 2025 TV access revenue.

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The firm estimates 2.74 million U.S. residential broadband subscribers were added in 2019 and revenue grew 8% to $66.7 billion. It forecasts additions will moderate in 2020 and that 2022 residential broadband access revenue will almost be on par with 2022 TV access revenue. Residential broadband subs surpassed TV subs in 2017.

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Cable continues to add the lion’s share of residential broadband subs (telco has lost residential broadband subs every year since 2015). AT&T, CenturyLink and Frontier were responsible for the majority of 2019 telco broadband losses, and Convergence forecasts they will contribute the majority of losses in 2020 as well.

“With programmers having jumped in with both feet, and Apple, DAZN, and Quibi joining Netflix and Amazon’s spending parade, the OTT arms race has truly begun,” reads the report. “We believe Netflix no longer has the same flexibility to raise pricing as frequently as it has in the past. Alternatively, Amazon and Apple have the luxury of expensing OTT programming as an additional operating cost to their core businesses. Amazon has clearly demonstrated its programming commitment to OTT. It remains to be seen if Apple is willing to endure the long-term spending campaign required to become a key OTT player.”

“The Battle for the American Couch Potato: OTT and TV” and “The Battle for the American Couch Potato: Bundling, TV, Internet, Telephone, Wireless” samples, summary and contents can be found here.

Amazon Working With Cable Group to Incorporate Fire TV

Amazon announced it is working with the National Cable Television Cooperative (NCTC) to enable the trade group’s distribution members to deliver Fire TV streaming media players directly to their customers. Amazon claims Fire TV has surpassed more than 40 million active users.

As the cable industry continues to lose subscribers to alternative distgribution channels, including over-the-top video, it is working with OTT players such as Amazon to meld OTT technology with linear TV.

Fire TV, of course, enables users to access Amazon and third-party Internet-based apps through the television.

NCTC has over 750 members, including independent cable and telecommunication operators, delivering service to 16 million broadband and 8 million video customers in the aggregate.

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The cable agreement coincides with Amazon’s expansion of the Fire TV Edition program, designed to give more opportunities for developers, operators, device makers and manufacturers across multiple categories, including automotive, smart TVs, soundbars and streaming media players.

With this expanded Fire TV Edition, the e-commerce giant said it would be easier for device makers to integrate Fire TV into their products, with new tools and services for each category that will enable companies to bring tailored entertainment experiences and great content to their customers.

“At CES 2017, we announced the first Fire TV Edition smart TV,” Marc Whitten, VP of Amazon Fire TV, said in a statement. “Now, just three years later, Fire TV Edition has grown into a worldwide program, which will include more than 150 Fire TV Edition models across more than 10 countries by the end of the year.”

In 2018, Amazon and Best Buy announced an initiative to bring Fire TV Edition TVs to customers in the United States and Canada, and to date, they have sold millions of Insignia and Toshiba Fire TV Edition smart TVs.

“Over the past year, Best Buy has sold millions of Fire TV Edition smart TVs on BestBuy.com, in our stores and as a third-party seller on Amazon.com. We’ve enjoyed working with the Amazon team to bring these high-quality TVs and the incredible Fire TV experience to our customers,” said Luke Motschenbacher,VP of merchandising at Best Buy.

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Following the success of Fire TV Edition smart TVs with Best Buy, Amazon announced plans to expand internationally, bringing the next generation of Fire TV Edition devices to customers in the United Kingdom, Germany, Austria, Ireland and India.

In 2019, more than 50 Fire TV Edition smart TVs and soundbars have launched from global brands like Grundig, JVC, Onida and Anker and retailers like Best Buy, Currys PC World and Media Markt Saturn (coming 2020).

Amazon will continue its international expansion with more brands launching Fire TV Edition smart TVs in the United States, Canada, India, United Kingdom, Ireland, Germany, Austria, Italy, Spain and Mexico in the coming year.

Fire TV Edition for Soundbars

This past September, Amazon and Anker Innovations announced the Nebula Soundbar–Fire TV Edition, the first Fire TV Edition soundbar featuring an all-in-one home cinema experience with expansive video streaming and stunning sound.

The TCL Alto 8+ Soundbar–Fire TV Edition is now available on Amazon in the United States and Canada. Customers of amazon.co.uk, amazon.de, amazon.fr, amazon.it and amazon.es can sign up to be notified when the TCL TS8011 Soundbar–Fire TV Edition is available on Amazon.

Both soundbars are designed to support premium acoustic performance, with carefully tuned speaker drivers and support for Dolby Digital Plus producing clear, dynamic and immersive sound.

Amazon now works with a growing number of device manufacturers including Anker, Polk Audio and Tonly on soundbar solutions. Later this year, Fire TV Edition soundbars will offer new features, including Dolby Atmos support, compatible device control, HDMI switching and far-field voice control, along with partner customizations.

Fire TV Edition for Auto

Building on the success of Fire TV Edition smart TVs and soundbars, Amazon is expanding the program to automakers, partnering with BMW and Fiat Chrysler Automobiles (FCA).

With hands-free access to Alexa, touch screen interface and offline playback capabilities, parents and kids alike can enjoy the living room TV experience in the car and watch a wide variety of content and the latest shows from the most popular video services worldwide and shows recorded with Fire TV Recast or saved locally on-device.

Content can be streamed using a vehicle’s Wi-Fi or LTE connection, a mobile hotspot or any other WAN-enabled device.

“Adding Fire TV to future BMW vehicles represents a big step in bringing the best of streamed entertainment to our products. With Amazon’s approach, and with the help of Garmin, we are able to innovate and create a unique and special experience for BMW cars, providing the consistency of content and customer experience that Fire TV provides in the home. We look forward to working closely with Amazon to bring Fire TV to future vehicles,” said Fathi El-Dwaik, VP, User Interaction, Business Line My Car and Business Line My Life, BMW Group.

Fire TV Edition for Operators

Fire TV is also enabling television and telecommunication operators to quickly bring Fire TV Edition devices to their customers in a more customized and cost-effective way.

After successfully introducing Fire TV partnerships with Tata Sky in India and Verizon in the United States, Fire TV is now expanding the device offerings available to operators, allowing them to choose the best solution that fits their customer and business needs as well as providing merchandising opportunities in the Fire TV Edition customer experience.

The Fire TV Edition for Operators is available today in North America, Europe, India and Japan.

Fire TV Edition — Certified Solutions Providers

Fire TV is enabling partners across a variety of industries and categories to work with certified solutions providers to rapidly bring the latest Fire TV Edition devices to customers. Amazon currently works with a growing number of TV manufacturers who produce Fire TV Edition smart TVs. Vestel, Arcelik, Compal, TPV and others can now build Fire TV Edition smart TVs for their customers with manufacturing and assembly capabilities around the world.

Amazon announced that Skyworth is the latest global ODM with turnkey solutions for smart TVs. These turnkey solutions enable Skyworth and other ODMs to work with the world’s leading TV brands to bring high-quality, differentiated, cost-effective 4K and FHD smart TVs to customers.

Starting in India, brands can choose from a selection of manufacturers with various industrial design and price options to bring an entire lineup of smart TVs to customers.

The turnkey ODM solution offered in collaboration with Amazon includes out-of-the-box reference designs, schematics and boards designed with CVTE, a leading LCD TV mainboard provider for feature-rich 4K and FHD smart TVs; self-service tools and software customizations, such as settings SDK for custom picture and audio settings; and customized industrial design and hardware options.

“We are excited to build a scalable, worldwide smart TV program with Fire TV Edition,” said Tony Wang, CEO of Skyworth TV Business Division. “ODMs & OEMs can offer customers the choice of a top-rated smart TV software experience along with the speed, value and high-quality hardware that they always expect from Skyworth.”

Finally, for auto partners, Amazon is working with system integrators VOXX Automotive and Garmin to deliver solutions and services that can significantly accelerate the development cycle for automakers.

“By working with Amazon to enable Fire TV for in-vehicle entertainment, we have been able to create a reference implementation that automotive OEMs can build into their vehicle programs and bring all of the rich entertainment of Fire TV into automotive grade installations,” said Ed Mas, President, VOXX Automotive, a division of VOXX International Corp.

 

Cable Trade Groups Drop ‘Cable’ Name

In an over-the-top video era driven by Netflix & Co., pay-TV can seem dated, while cable is downright old-school.

That prompted the American Cable Association to become the latest trade group move away from its legacy medium in favor of embracing rapidly-changing technology with the far-less constricting “communications” moniker.

“It’s all about the communications and connections our members provide,” Matthew Polka, CEO of the newly named American Communications Association, said in a statement.

Notably, ACA’s 700 members largely deliver cable TV to about 8 million subscribers nationwide. But with changing consumer habits toward home entertainment, many of the providers also offer high-speed Internet to remain competitive.

“Even though our industry and technology are changing so rapidly fueled by our members’ broadband deployments, what’s most important for our members and their customers is the ability to communicate freely and connect in their homes and businesses in countless new ways,” Polka said. “With this name change, we’re recognizing that communication is the priority, not the medium.”

ACA’s name change comes three years after the National Cable & Telecommunications Association (NCTA) renamed itself the NCTA — The Internet & Television Association. “Just as our industry is witnessing an exciting transformation driven by technology and connectivity, NCTA’s brand must reflect the vibrancy and diversity of our members,” CEO Michael Powell said at the time.

While both trade group continue to lobby hard for cable distributors, they are loath to admit as much publicly. In feed, the NCTA’s annual “The Cable Show” was rebranded to “INTX: The Internet & Television Expo.”

Powell said the group’s mission to drive the industry forward remains unchanged.

“But, we’re no longer simply a provider of one-way video programming,” he said.

 

Season Four of ‘Better Call Saul’ Coming to Disc May 7 From Sony

Season four of “Better Call Saul” will land on Blu-ray and DVD May 7 from Sony Pictures Home Entertainment.

In the critically acclaimed show’s fourth season, the death of Jimmy McGill’s brother catalyzes his transformation into the bigger-than-life legal legend Saul Goodman.  Now, Jimmy steps into the criminal world, putting his future as a lawyer — and his relationship with Kim Wexler — in deep jeopardy.

Bob Odenkirk (TV’s “Breaking Bad”) stars as McGill, Jonathan Banks (TV’s “Breaking Bad”) as Mike Ehrmantraut, Rhea Seehorn (TV’s “Franklin & Bash”) as Wexler, Patrick Fabian (The Last Exorcism) as Howard Hamlin, Michael Mando (TV’s “Orphan Black”) as Nacho Varga, and Giancarlo Esposito (TV’s “Breaking Bad”) as Gus Fring.

The disc sets contain all 10 episodes and includes cast and crew audio commentaries on every episode, a gag reel, and the featurette “Slippin’ Kimmy,” which explores the complex character Kim Wexler, whose personal and professional triumphs are threatened by the temptation to cut corners. Also included are ten Madrigal Security Training Videos with Mike Ehrmantraut and the short film “No Picnic” featuring fan-favorite characters The Kettlemans. Blu-ray exclusive content includes seven deleted scenes, three storyboard scene comparisons, a directorial walk-through, and two featurettes: “Flashing Forward, Looking Back,” which highlights the show’s use of non-linear storytelling to explore the many layers of Jimmy’s transformation, and “Constructing the Superlab,” which takes an in-depth look at the process of building Gus Fring’s Superlab both on and off-screen.

Fourth Season of ‘Ballers’ Due on Digital from HBO Nov. 5

Ballers: The Complete Fourth Season, featuring Dwayne Johnson, will be available for digital download Nov. 5 from HBO Home Entertainment.

In the fourth season of the series exploring the glamorous and often cutthroat world of pro football, Spencer (Johnson) and Joe Krutel (Rob Corddry) expand their empire in Los Angeles. Meanwhile, Ricky (John David Washington) eyes a comeback.

Guest stars include Russell Brand, Tony Hawk, Joy Bryant and Ernie Hudson.

Third Season of HBO’s ‘Insecure’ Available on Digital Oct. 29

The latest season of HBO’s Emmy- and Golden Globe-nominated comedy series “Insecure” will be available for digital download Oct. 29.

Insecure: The Complete Third Season follows creator, writer and star Issa Rae as Issa, and her best friend Molly (Yvonne Orji) as they tackle work woes, relationship escapades and awkward moments. In the third season, Issa attempts to navigate complicated relationships while on the work front she begins to question her role at the nonprofit We Got Y’all. Meanwhile, Molly (Yvonne Orji) sets boundaries in order to concentrate on her dream job at a black-owned law firm, which she risks sabotaging with her insecurities and hang-ups.

Jay Ellis (Lawrence), Y’lan Noel (Daniel), Natasha Rothwell (Kelli), Amanda Seales (Tiffany) and Lisa Joyce (Frieda) also return.

Comcast Shareholders Nix Lobbying Transparency

Comcast shareholders June 11 voted against a proposal that would have called for greater disclosure of funding spent by the media company on industry lobbying.

Comcast spent more than $29 million in 2016 and 2017 on federal lobbying activities — fourth highest among U.S. companies, according to shareholder Kate Monahan. Speaking at Comcast’s annual shareholder meeting, Monahan claimed the company fails to reveal how much is spent lobbying at the state and local level.

She called on shareholders to approve her proposal requesting the board disclose all funds spent on lobbying. Monahan also called on Comcast to exit the American Legislative Exchange Council, a non-profit she claimed works against clean energy adoption.

“Investors have no idea how much the company is spending overall and yet the company could easily and inexpensively disclose this information,” Monahan said.

Shareholders, not surprisingly, rejected the proposal, according to preliminary vote tallies.

CEO Brian Roberts, after reiterating company highlights in fiscal year, reminded shareholders that anyone fortunate to buy a lot Comcast stock 46 years ago would be very rich today.

“If you had bought 1,000 shares of our stock with my dad at $7 a share in 1972, you would now have $10 million versus nearly $700,000 if you’ve invested in the S&P 500,” Roberts said.

HBO’s ‘Silicon Valley: Season 5’ Available for Digital Download June 11

Silicon Valley: Season 5, will be available for digital download June 11 from HBO Home Entertainment.

The latest release in the Emmy Award-winning series includes eight, 30-minute episodes and explores new dynamics for the core cast. Pied Piper on an upswing as the platform’s new peer-to-peer internet platform is garnering buzz and looking poised to make a splash. However, leadership challenges, new faces in a new office, and the looming rivalry with Hooli CEO Gavin Belson threaten to shake Richard Hendricks’ confidence.

In addition to Emmy-nominee Thomas Middleditch as Richard Hendricks (Joshy,Godzilla King of Monsters), the cast includes Zach Woods as Jared (“The Office,” The Post), Kumail Nanjiani as Dinesh (The Big Sick), Martin Starr as Gilfoyle (“Freaks and Geeks,” “Party Down”), Josh Brener as ‘Big Head’(“Maron,” “Highly Gifted”), Amanda Crew as Monica Hall (Table 19, American Murderer), Matt Ross as Gavin Belson (“Big Love,” “American Horror Story”), Jimmy O. Yang as Jian Yang (upcoming Crazy Rich Asians) and Suzanne Cryer as Laurie Bream (The Fosters).

Research: U.S. Pay-TV Affordability Has Dropped Since 2000

Consumers who complain about their cable bill may have good reason.

Multichannel video affordability in the United States has plummeted since the turn of the millennium, squeezing the penetration rate, particularly among the more economically vulnerable households, according to new data from Kagan, S&P Global Market Intelligence.

Since 2000, there has been a 74% increase in the inflation-adjusted pay-TV bill while incomes have stagnated, according to the research.

The estimated nominal average monthly multichannel revenue per subscriber across the cable, DBS and telco platforms rose at a 5.5% CAGR between 2000 and 2017. Kagan calculated U.S. multichannel purchasing power based on 2017 inflation-adjusted annual multichannel average revenue per user, or ARPU, and average income figures. The affordability calculation dropped from a 10 in 2000 to a 6 in 2017.

Multichannel offerings have evolved a great deal since 2000, including a greater number of networks and advanced services such as video on demand, DVR services and improved user interfaces, with the vast majority of the packages delivered to subscribers digitally and in HD, but consumers’ ability to pay the price for that improvement didn’t grow much.

“The eroding legacy multichannel affordability partly explains the popularity of over-the-top services such as Netflix Inc. and Amazon.com Inc.’s Prime Video,” according to Kagan.