Parks: SVOD Accounts for 86% of Consumer Online Movie, TV Spending

New research from Parks Associates finds that subscriptions, formerly representing just over half of total online video spending in 2012, now account for nearly 86% of all internet spending on TV and movies.

The Dallas-based research follows analysis of market trends and profiles of OTT video service providers in the U.S. and Canada, including Netflix, HBO, YouTube, and Amazon as well as new services Disney+, HBO Max, and Frndly TV.

“The new services launching over the next several months are taking different approaches as they enter a crowded OTT market,” said Brett Sappington, senior research director and principal analyst. “While the U.S. market is important for Disney, the company will ultimately measure the success of its Disney+ service on a global scale.”

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Sappington believes AT&T sees its formerly branded DirecTV Now (now AT&T TV) service as the evolution of its core pay-TV business rather than as an extension of its vMVPD efforts.

The Frndly TV is a niche play Sappington says is targeting a specific group of consumers with a low price and family-friendly content.

Parks says the new services, including Apple TV+, will drive consumers to increase spending on internet video and maximize the proportion of spending on subscriptions. The increasing number of new services will also test consumers’ tolerance for adding new accounts to their monthly expenditures.

“The amount of money consumers spend per month will spike, at least in the short term, as new services such as Disney+ and Apple TV+ become available. Tradeoff decisions will come later,” Sappington said. “To keep consumers spending at this higher level, services will have to consistently deliver volumes of compelling content within an engaging user experience.”

HBO Max Gets ‘The Big Bang Theory’ Catalog

A day after Netflix secured streaming rights to “Seinfeld” from Hulu, HBO Max is reportedly obtaining exclusive domestic rights to former CBS sitcom “The Big Bang Theory” for upwards of $1 billion for five years.

While CBS has its own SVOD service, CBS All Access, “Big Bang Theory” is produced and distributed by Warner Bros. Television, which is owned by HBO parent WarnerMedia (and AT&T).

HBO Max continues to spend big for its pending service launch, including inking director J.J. Abrams and his Bad Robot production company for original movies and episodic content for a reported $500 million.

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The service previously shelled out $425 million for the rights to “Friends” from Netflix. NBC Universal spent $500 million acquiring “The Office” catalog — also from Netflix.

“We’re thrilled that HBO Max will be the exclusive streaming home for this comedy juggernaut when we launch in the spring of 2020,” Robert Greenblatt, chairman of WarnerMedia’s entertainment and direct-to-consumer divisions, told The Hollywood Reporterwhich broke the story. “This show has been a hit virtually around the globe, it’s one of the biggest shows on broadcast television of the last decade, and the fact that we get to bring it to a streaming platform for the first time in the U.S. is a coup for our new offering.”

New SVOD Players Targeting Specific Audiences

With several new high-profile streaming video services about to launch, appealing to select audiences appears to be the initial strategy competing against Netflix, Amazon Prime Video and Hulu, according to new data from Ampere Analysis.

The London-based research firm Sept. 17 in a profile of six new services — Disney+, Viacom’s BET+, WarnerMedia’s HBO Max, NBC Universal’s Peacock streaming service, Apple TV+ and short-form start-up Quibi — found that content strategies going forward is largely based on their media parents.

Some services will rely on original fare (notably Apple), while others will offer catalog content and third-party licensed programming.

Ampere says Disney+ will focus on family fare with 61 original series and titles, in addition to select catalog. The service is focusing on TV and movies, with TV spin-off The Phineas & Ferb Movie, and a live-action remake of The Lady and the Tramp. Over one-third of its original content is unscripted.

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With most of its mobile-centric content about 10 minutes or less in length, Quibi can compete with Disney+ in terms of number of titles, according to Ampere. The platform is entirely reliant on the success of its original titles as its short-form nature means there’s no back catalog and no acquisition targets.

The start-up has the highest proportion of unscripted content of the six players at 40% and is targeting it at a youth-skewing audience.

Apple TV+ is focusing on big-budget, big name flagship scripted series, such as “The Morning Show” featuring Jennifer Aniston and Reese Witherspoon. Indeed, about 87% of content is scripted.

Buoyed by strong catalog, Ampere expects WarnerMedia’s HBO Max to be led by premium scripted content, although it recently announced its first two unscripted original commissions.

With under five originals, Ampere expects NBC Universal’s service to be mainly catalog-focused. It has commissioned a third season of high school comedy “A.P Bio,” previously cancelled at linear network NBC. To date all announced content is scripted.

Viacom’s BET+ has less than five originals to its name to date, and so will also rely on its existing catalog rather than original content. Another similarity with NBC is that all announced content is scripted.

“Disney+ is focused particularly on family content, with nothing higher than a 13-years age rating, with more-mature content left to the bundle-able platforms Hulu and ESPN+,” analyst Fred Black said in a statement.

“Mobile-only short-form strategy is designed to target teenagers and young adults in the 16-40 years age bracket, while BET+ will be hoping to target the same African American audience as the successful linear equivalent. WarnerMedia, having decided to use the HBO brand name, will similarly be aiming to convert some of that linear audience to streaming subscribers.”

The research firm says three of the six new services have announced unscripted content. Disney+ and Apple TV+ have a strong focus on documentaries. Disney+ has named National Geographic a core brand and has also announced science history series, “The World According to Jeff Goldblum.”

Apple TV+ documentaries include dinosaur-themed “Prehistoric Planet.” In contrast, Quibi’s unscripted slate includes 10 reality titles, including motoring challenge show, “Elba vs. Block.” The player is the only new service to offer daily news and current affairs via partnerships with NBC and BBC.

Ampere’s analysis of upcoming originals found that 66% of content originates from its existing source material, such as movie brands and literary adaptions, which is more than any of the other three studio-backed services.

About 47% of Apple TV+ and 43% of HBO Max’s commissions are original concepts. Both players have turned to literary adaptions to build prestige, scripted content.

For instance, at Apple TV+ there’s Stephen King’s “Lisey’s Story,” and at HBO Max, there’s Alissa Nutting’s sci-fi drama “Made for Love.” In complete contrast, only 2c4% of Quibi’s commissioning is originals based on source material. They include four literary adaptations and three movie remakes, among them “How to Lose a Guy in 10 Days.” NBC has yet to commission any original concepts.

More than 27% of scripted commissions across the six new services are sci-fi and fantasy, followed by crime & thrillers at 21%.

These genres have proved particularly successful for Netflix and Amazon, so it’s not surprising these new competitors have prioritized the genres, says Ampere.

HBO Max has Gremlins spin-off “Secrets of the Mogwai,” while Apple is combining sci-fi and crime with drama. For Disney+, children and family content will dominate alongside sci-fi and fantasy.

Disney+ originals are being used to drive early subscriber growth, leveraging well-known brands such as Marvel superhero titles “Loki” and “The Falcon and the Winter Soldier” and “Toy Story” spin-off “Lamp Life.”

Meanwhile, 43% of HBO Max titles feature a female lead. HBO Max is the only platform where female-led content is the most prominent category.

Disney+’s focus on spin-offs and reboots from older titles has left it with a more male-centric set of commissions, with 39% of titles with lead characters featuring a male lead.

Mixed gender group casts are however common at Disney+ (23%), as well among Apple TV+ (29%) and HBO Max (33%) commissions.

This compares to Quibi, where titles with protagonist groups account for only 4% of commissions. With episodes roughly 10 minutes long, titles by necessity tend to focus more on a specific male or female protagonist.

“Across the six platforms the two most popular genres for commissioners have been sci-fi and fantasy and crime and thrillers, showing a willingness from the new players to take on Amazon and Netflix’s original content head-to-head,” Black said.

BBC Boss: TV Facing ‘Second Wave of Disruption’

First came Netflix, Amazon Prime Video and Hulu — the three subscription streaming video-on-demand service upending the traditional pay-TV ecosystem and business model.

The SVOD challengers resulted in media companies rolling out standalone online TV platforms such as Dish Networks’ Sling TV and AT&T’s former DirecTV Now (now AT&T TV), among others.

Later this week, Tony Hall, CEO of the venerable BBC, is slated to give a speech at the Royal Television Society confab in Cambridge outlining what he perceives is a second “American invasion” featuring new-edition SVOD services.

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Indeed, pending U.S. services coming to the U.K. include Disney+, HBO Max, Hulu and Apple TV+, among others.

“Our industry is about to enter a second wave of disruption,” Hall said in prepared comments. “The first was about the rise of Netflix, Amazon and Spotify — market shapers that fundamentally changed audience behavior, often at the cost of huge losses or massive cross-subsidy.

“The second wave will see a range of new entrants entering an already crowded market,” he said.

The BBC is fighting back by licensing original content, “Love Island,” “Gavin & Stacey,” “Gentleman Jack” (available in the U.S. on HBO) and “Broadchurch” on Britbox, the SVOD service co-launched in the U.S. and now the United Kingdom with ITV.

“We’re not Netflix, we’re not Spotify. We’re not Apple News. We’re so much more than all of them put together,” Hall said.

Indeed, BBC was one of the first broadcasters to launch a branded streaming media devices — BBC iPlayer and BBC Sounds — to capture changing consumer habits.

“In the space of a year, iPlayer’s reach to young audiences is up by a third,” Hall said. “There is really promising growth right across the piece. And that’s before we roll out our full plans for extended availability and exclusive content.”

Sofia Chang and Rich Warren Tapped to Lead WarnerMedia Distribution

Sofia Chang and Rich Warren have been named to lead WarnerMedia Sales and International’s distribution business.

Both will take the role of president of WarnerMedia Distribution, and will oversee distribution for all Turner channels, HBO, Cinemax and HBO Max and will report to Gerhard Zeiler, chief revenue officer of WarnerMedia, and president of WarnerMedia International Networks.

Chang held the previous post of EVP of global digital distribution for HBO, and Warren was president, Turner content distribution.

Chang has held several positions in the company since joining HBO in 2000. She has led the transactional digital and physical distribution of HBO and Cinemax programs worldwide and since 2015, she has been responsible for distributing HBO and Cinemax subscription services on all digital platforms.

Warren has been at the company for 19 years and has led Turner’s distribution team, where he was responsible for the company’s multiplatform distribution of linear networks, digital brands and on-demand content, affiliate marketing, business development, strategic planning and business affairs.

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“Bringing together the distribution business is a further example of how WarnerMedia will be collaborating and working as one company,” according to a studio press release. “As the company looks to meet the challenges of the industry head on, this new structure does that.”

“We will have two hugely experienced leaders who know our business inside out,” said Zeiler in a statement. “Over the last few months I have worked closely with both; Sofia’s experience and success in driving HBO’s digital subscriptions has been of great value as I have looked to understand the U.S. HBO business in greater depth and detail, and Rich has brought his strategic skills to the table as we have sought this way forward. Working together both will provide the strategy and direction needed to enable future growth.”

Disney Renting Pinewood Studios in Buckinghamshire, U.K.

Ramping up for the November launch of Disney+, the Walt Disney Co. on Sept. 8 announced it has inked a 10-year rental agreement with London-based Pinewood Studios, which has production facilities around the world, including Atlanta.

With Disney banking much of its media distribution future on over-the-top video, the company borrowed a page from SVOD pioneer Netflix, which in July announced plans to create a production hub at Pinewood’s Shepperton studios for original shows.

Under its new deal with Pinewood, which launched in 1936, Disney will take all the stages, backlots and other production accommodation at the Buckinghamshire location in the United Kingdom.

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Emily Blunt in Disney’s ‘Mary Poppins Returns’

“It’s wonderful to have Disney here at Pinewood,” Paul Golding, chairman of Pinewood Group Limited, said in a statement. “They’ve been making great films with us for many years and the fact they want to shoot so many more here is testimony not only to the quality of the teams and infrastructure at Pinewood, but also to the British film industry as a whole.”

Indeed, Disney has used Pinewood previously to make Mary Poppins Returns, starring Emily Blunt, Star Wars: The Last Jedi, and Marvel’s Guardians of the Galaxy.

With the pending rollout of Disney+ streaming service, Apple’s branded Apple TV+ and WarnerMedia’s HBO Max, Britain is a hotbed for film and TV show productions, including actors, for American media companies.

Revenue by the nation’s independent TV producers grew 10% to a record £3 billion ($3.7 billion) in 2018 thanks to a surge in commissions from overseas streaming services, according to the industry body Pact.

Report: Euro Broadcasters Must Up Content Spend to Compete Against American OTT Video

With Disney, Apple and WarnerMedia all launching subscription video-on-demand services by the end of the year and into 2020, most platforms have European distribution strategies similar to Netflix and Amazon Prime Video.

That looming reality is putting pressure on local and regional pay-tv operators to match or at least up original content spending to retain and lure subscribers.

New data from Deutsche Bank found, for example, that German broadcaster RTL would have to significantly increase its €300 million ($330 million) annual original content spending to remain competitive.

ProSieben, ITV, TF1/M6 and the Spanish broadcasters have all reportedly pledged modest increases in original content spending.

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A shot in the dark considering Apple reportedly is budgeting $6 billion for original content, while Netflix has pledged a $2.5 billion uptick on — largely — original movies.

Deutsche Bank contends RTL would have to increase original content spending to at least €400 million ($440 million).

“They will also need to raise spend or see a further acceleration in the decline of their core linear advertising revenues,” Deutsche Bank wrote in a note.

The bank noted that while RTL added a respectable 200,000 SVOD subs in the first half of 2019, about half of its 1.2 million subs are in Holland where its €7.99 ($8.79) pricing looks vulnerable against Disney+ pricing announced pricing of $7.99.

“Even the TV Now offer in Germany from RTL at a lower price of €4.99 ($5.49) looks vulnerable versus with 3-year Disney+ subscriptions being offered at $3.92 per month,” read the note.

Deutsche Bank said Disney content spending of $4 billion [annually) within the platform’s first three years looms large over RTL’s incremental content spend of €100 million and ITV’s £30 million ($36.5 million).

Analyst: Apple Expected to Top Netflix in Original Content Spend

With Apple rolling out its upgraded Apple TV+ in November, the cash-rich tech giant is reportedly set to beginning spending big dollars on original content.

New data from Ampere Analysis contends Apple will spend more than $6 billion on original content for its new subscription streaming video service — six times what it has spent in previous years, according to The Financial Times.

Apple has announced 36 original titles for the new service, an uptick in content spending that ranks it among Disney/Fox, NBC Universal/Comcast/Sky and Viacom/CBS.

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Notably, Apple’s burgeoning spending is expected to top Netflix’s $2.4 billion original content spend in 2019, according to Ampere.

“Apple’s significant increase in content expenditure highlights its commitment to the streaming video space, and its willingness to go head-to-head with the industry’s biggest spenders,” analyst Daniel Gadher wrote in a note.

Gadher believes Apple’s content spending underscore’s the company’s strategy to emulate Netflix, Amazon Prime Video and Hulu’s programming platforms.

With Disney+, HBO Max, NBC Universal’s unnamed service, and Jeffrey Katzenberg-led Quibi all entering the market, Gadher contends “high value” exclusive content will become key.

Disney has said it would spend about $1 billion on Disney+ original content, increasing to $2.5 billion by 2022. It has announced 43 original titles for the service.

Ampere expects Disney will spend $5 billion on original Disney programming plus the additional original spend from its acquired Fox assets.

Quibi, the mobile-only streaming platform concentrating on short-form video has committed $1.1 billion in original content in its first year. It has commissioned 44 new titles.

“The ability of the platforms to produce quality and differentiated content will be integral to success in a market where Netflix, Amazon and Hulu are already entrenched,” Gadher wrote.

HBO Now Unveils September Slate

HBO Max may be coming, but in the meantime there’s HBO Now, WarnerMedia’s four-year-old subscription streaming video service with more than 5 million subs.

The SVOD in September rolls out a new slate of movies, including Warner Bros.’ Isn’t It Romantic, starring Rebel Wilson and Liam Hemsworth, The Lego Movie 2: The Second Part, Universal Pictures Home Entertainment’s  Mary Queen of Scots with Margot Robbie and Saorise Ronan, Welcome to Marwen, and teen thriller Truth or Dare.

This fall also kicks off the third seasons of drama “The Deuce” and anthology series “Room 104,” as well as a new episode of “The Shop: Uninterrupted.”

HBO Documentary Films commemorates the tragic events of September 11, 2001 with the debut of two documentaries, In the Shadow of the Towers: Stuyvesant High on 9/11 and the children’s show, What Happened on September 11.

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Meanwhile,  Mean Girls, Deadpool 2, Rampage, Splice and Breaking In depart the SVOD at the end of the month.

Theatrical Premieres:
Nancy Drew and the Hidden Staircase, 2019 (9/1)
Truth or Dare, 2018 (9/4)
Mary Queen of Scots, 2018 (9/7)
Welcome to Marwen, 2018 (9/14)
They Shall Not Grow Old, 2018 (9/17)
The Lego Movie 2: The Second Part, 2019 (9/21)
Isn’t It Romantic, 2019 (9/28)
Original Programming:
The Shop: Uninterrupted (9/3)
In the Shadow of the Towers: Stuyvesant High on 9/11 (9/11)
What Happened on September 11 (9/11)

Original Programming:
“The Shop: Uninterrupted” (9/3)
“In the Shadow of the Towers: Stuyvesant High on 9/11” (9/11)
“What Happened on September 11” (9/11)
Season Premieres:
“The Deuce, Season 3” Premiere (9/9)
“Room 104, Season 3” Premiere (9/13)

Season Finale:
“Hard Knocks: Training Camp with the Oakland Raiders, Season Finale” (9/3)
“A Black Lady Sketch Show, Season 1 Finale” (9/6)

Estrenos:
Ruta Viva, 2018 (9/1)
El Amor Menos Pensado (AKA An Unexpected Love), 2018 (9/6)
Más Sabe el Diablo por Viejo, 2018 (9/13)
Septimo (AKA 7th Floor), 2018 (9/20)
Perseguida (AKA Persecuted), 2018 (9/27)

Starting September 1:
127 Hours, 2010
Alfie, 2004
Anacondas: The Hunt for the Blood Orchid, 2004
Anastasia, 1997
Boys and Girls, 2000
Cabin Fever (Director’s Cut), 2003
Cabin Fever 2: Spring Fever (Extended Version), 2019
Catfish, 2010
The Darkest Hour, 2011
Frantic, 1988
Hail, Caesar!, 2016
How to Lose a Guy in 10 Days, 2003
The Hurt Locker, 2009
I Love You Phillip Morris, 2010
Jem and the Holograms, 2015
The Killing Fields, 1984
Love Actually, 2003
Out of Sight, 1998
Resident Evil: Apocalypse, 2004
Robocop (Director’s Cut), 1987
Robocop 2, 1990
Robocop 3, 1993
The Rundown, 2003
The Spongebob Squarepants Movie, 2004
Thirteen Days, 2000
United 93, 2006
The Wizard, 1989

Ending September 5:
The Water Diviner, 2015

Ending September 22:
The Green Inferno, 2015

Ending September 25:
Suffragette, 2015

Ending September 27:
Just Wright, 2010

 

HBO Max, BBC Partner for New Original Comedy Series

WarnerMedia’s pending subscription streaming video service HBO Max has partnered with BBC Three for new London-based comedy series “Starstruck.”

The six-part show is written, created by and starring 2018 Edinburgh Comedy Award winner Rose Matafeo.

The show, which will also be broadcast in the U.K., follows twentysomething Rose (Matafeo), a millennial juggling two dead-end jobs and navigating the awkward morning-after when she discovers the complications of accidentally sleeping with a movie star.

Rose Matafeo

“The BBC have been so supportive of this project from the get-go and to be able to get this show in front of American audiences at the same time via HBO Max is truly exciting,” Matafeo said in a statement. “I’m thrilled we get to make it, otherwise it would’ve technically just been a creepy fan fiction script that I submitted to the national broadcaster.”

“The minute we were introduced to Rose and ‘Starstruck,’ we knew we had something special,” said Sarah Aubrey, head of original content, HBO Max. “She is exactly the type of original, culture-forward creator we are excited to be working with at HBO Max and we are looking forward to a long partnership.”

Aubrey, along with other Max executives, is profiled in the “2019 Women in Home Entertainment” issue of Media Play News.

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Matafeo won “Best Comedy Show” for her solo show “Horndog,” which has enjoyed sell-out performances around the world, including the New Zealand International Comedy Festival and a Barry Award nominated run at the Melbourne Comedy Festival.