Estrella Media Hires Ex-Sony Crackle Executive René Santaella

Estrella Media, a Spanish-language media company operating branded network and digital media platforms across U.S. Hispanic markets, Oct. 13 announced the appointment of industry veteran René Santaella as EVP of digital and streaming media.

Santaella, who was SVP, head of ad sales and operations at Sony Pictures Television Digital Networks, will be tasked with leading the digital transformation of Estrella Media, including building operations and generating new revenue initiatives. At Sony, Santaella helped build ad-supported VOD service Sony Crackle, which was subsequently rebranded Crackle Plus by new owner, Chicken Soup for the Soul Entertainment.

Rene Santaella

In that capacity, Santaella also managed ad sales, operations and strategic initiatives and led the creation of a premium video network for advertisers targeting “connected gamers,” which included PlayStation Store, Funimation, Pluto TV and Crackle. Before Sony, Santaella was director of ad sales marketing for Disney Interactive, leading digital and cross-platform advertising and integrated marketing solutions across the company.

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“René has an amazing track record in working with some of the world’s largest media brands and transforming their businesses into digital leaders,” Estrella Media CEO Peter Markham said in a statement. “We could not be more pleased to have him plot the course of our continued transformation into a Hispanic digital leader across all platforms.”

 

Ad-Supported VOD Revenue to Reach $56 Billion by 2024, Driven by U.S.

Ad-supported video-on-demand, the free streaming video alternative to subscription VOD, continues to gain momentum.

New data from Digital TV Research projects AVOD revenue will more than double between 2018 and 2024 topping $56 billion across 138 countries — including notably in the United States. Online TV and video advertising has been considerably boosted in recent years by the rapid growth in mobile advertising, according to DTR.

While AVOD penetration in the Asia Pacific region is well-established, topping $10.73 billion in 2018 with 49% of the global marketshare, the rest of the world is catching up. Despite more than doubling to $25.14 billion by 2024, Asia Pacific’s marketshare will fall to 45%.

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From the $34.42 billion additional revenue to be generated between 2018 and 2024, Asia Pacific will contribute $14.41 billion and North America $14.20 billion. All of the other regions will at least double their totals.

“China is the largest AVOD country — commanding 36% of the 2018 global total, with $7.78 billion,” Simon Murray, principal analyst at Digital TV Research, said in a statement. “Most OTT viewing in China is on mobile phones to AVOD-supported platforms. China will still generate 29% of the global total by 2024 with $16.60 billion.”

Murray said the U.S. will become the AVOD leader by 2023.

Indeed, several large platform domestic launches (i.e. NBC Universal, Sony Crackle) are expected in the near future, in addition to San Francisco-based Tubi TV, which bowed in 2014 with more than 9,000 movies and television shows, Amazon’s IMDb TV (formerly IMDb Freedive) and The Roku Channel, among others.

“The U.S. will more than triple its AVOD revenue total between 2018 and 2024 to $19.23 billion — or 34% of the global total,” Murray said.

Roku CEO: We Are the No. 1 Smart TV Operating System in the U.S.

Roku said 33% of all Internet-connected “smart” televisions sold domestically in the first quarter (ended March 31) featured its branded operating system. That’s up from 25% of all TVs sold in 2018.

“In less than five years, the Roku TV has gone from a disruptive idea to the market leader,” founder/CEO Anthony Wood said on the fiscal call. “We have taken the leads from Samsung and are now the number one smart TV OS in the country.”

Anthony Wood

Wood attributed Roku’s transition from streaming media device manufacturer to ad-supported VOD distributor to ongoing consumer moves away from linear TV toward over-the-top video — and the CE industry’s sluggish efforts to develop “homegrown” software OS platforms in televisions.

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“We really think in almost all cases those [OS] solutions are probably uncompetitive and that we will just continue to see gains and share of licensed OS [platforms],” Wood said. “So there is a lot of room to grow. It’s a big opportunity.”

Meanwhile, Roku continues to drive an expanding AVOD market through its branded Roku channel. The AVOD market gained momentum following Viacom’s acquisition of Pluto TV, Comcast’s planned launch of AVOD distribution, Shout! Factory’s Shout TV, Sony Crackle and San Francisco-based Tubi, among others.

“We are excited about the increased investment and focus by major media companies on bringing free content over-the-top,” said Scott Rosenberg, GM, platform business. “When they do this, they ultimately accelerate the consumer move into OTT and expand the economic pie for all of us. We share in their success.”

Indeed, Roku said user accounts increased 40% to 29.1 million from 20.8 million last year. Consumer streaming hours increased 74% to 8.9 billion hours compared to 5.1 billion hours in the previous-year period.

“The most exciting thing about the Viacom/Pluto tie-up is the fact that Viacom is taking content that was previously only available through pay-TV subscriptions and making it available free through AVOD services,” he said. “That not only will that drive viewing on the platform, I think it will also help accelerate the shift of ad dollars over to streaming.”

Sony Crackle Merges with Chicken Soup for New AVOD Service

Sony Pictures Television March 28 announced it has merged its Sony Crackle AVOD service with Chicken Soup for the Soul Entertainment Inc., a media company producing content for all screens, to form a new AVOD joint venture branded, “Crackle Plus.”

Under the agreement, CSS Entertainment will own the majority interest in the joint venture. Additionally, SPT will receive 4 million five-year warrants to purchase Class A common stock of CSS Entertainment at various prices.

The addition of the Crackle assets is expected to more than double CSS Entertainment’s overall revenue and add meaningful pre-tax earnings.

Eric Berger, chief digital officer at Sony Pictures Television, will reportedly depart the company upon closure of the deal.

Eric Berger

Sony and Chicken Soup will each contribute certain assets with plans to combine their 10 million viewers and content expertise. SPT’s contributions feature Crackle’s U.S. assets, including the Crackle brand, monthly active users and ad rep business.

SPT and the joint venture will also enter into a license agreement for rights to TV series and movies from the Sony Pictures Entertainment library. In addition, New Media Services, a subsidiary of Sony Electronics Inc., will provide the technology back-end services for Crackle Plus.

Ownership of Crackle’s original content library will be retained by SPT but be made available for licensing to the joint venture. CSS Entertainment plans to include six owned and operated AVOD networks (Popcornflix, Truli, Popcornflix Kids, Popcornflix Comedy, Frightpix, and Espanolflix) and SVOD platform Pivotshare.

Crackle Plus is expected to have more than 38,500 hours of programming, 90 content partnerships; 1.3 billion minutes streamed per month, and an offering of more than 100 networks, both ad-supported and subscription-based, including networks owned by Crackle Plus and third-party networks distributed via Pivotshare.

“Crackle is a valuable asset and we feel confident it will thrive and grow in this new environment with CSS Entertainment,” said Mike Hopkins, chairman of SPT, in a statement. “We were drawn to CSS Entertainment as our partner in this venture because of its aggressive, entrepreneurial approach.

Tubi TV AVOD Service to Spend $100+ Million on Content in 2019

Tubi TV, the advertising-based video-on-demand service, Jan. 30 announced plans to spend more than $100 million on content in 2019.

The San Francisco-based service currently features a library of more than 12,000 movies and television series from more than 200 content partners, including most major studios.

Launched in 2014, Tubi said viewership increased 430% in 2018 compared to 2017, with December generating nearly as much content streamed as all of 2017.

The company said it turned a profit in the fourth quarter, ended Dec. 31, 2018, with revenue up more than 180% in 2018. More than 1,000 advertisers ran spots on Tubi, including consumer products and automotive advertisers reaching audiences via ads on movies and TV shows.

Late last year, Tubi became the third streaming service to be made available on Comcast’s X1 platform — behind Netflix and YouTube. The service plans to launch beyond the U.S. and Canada, with the first territories expected to be announced this quarter.

“In 2018, Tubi saw tremendous growth as consumers, fatigued by SVOD subscriptions and services, sought alternative entertainment choices,” CEO Farhad Massoudi said in a statement. “We will continue to use profits to make bigger bets on content, enhance the viewing experience, and continue to press ahead into new grounds in what is our core advantage: technology and data.”

 

Sony Shuttering Crackle Latin America

Sony Pictures Television is shutting down Crackle Latin America, the subscription streaming video service launched in 2016. The service with 400,000 subscribers – across 17 countries – will cease operations on April 30.

Sony has operated Crackle as an ad-supported service in the United States since 2012, and recently upped original content offerings such as crime drama “The Oath.”

Keith Le Goy, president of worldwide TV distribution and Sony Pictures Home Entertainment, announced the move in a memo to staff, which was obtained by Hollywood trades.

“After much consideration, we have decided that Crackle Latin America is not sustainable in the present highly competitive local environment,” wrote Le Goy. “Crackle Latin America is not sustainable in the present highly competitive local environment.”

Sony shuttered Crackle Canada last June.

The move is another shot across the bow for smaller SVOD services attempting to challenge Netflix, Amazon Prime Video and Hulu.

“OTT/direct-to-consumer remains an incredibly important area for our evolving industry, and we will persist in exploring other opportunities in the space,” wrote Le Goy. “The decision to close Crackle Latin America is unrelated to the U.S. Crackle business, which is operated independently as an AVOD service. We continue to explore potential strategic partnerships for Crackle in the U.S. and will share more information when possible.” 

 

 

 

 

 

News Analysis: AVOD Just Got Real

The biggest news during last week’s CES occurred hundreds of miles away in Los Angeles.

Amazon’s IMDb.com movie industry website confirmed previous rumors and nixed executive denials with the launch of a branded ad-supported video streaming platform.

IMDb Freedive enables customers to watch TV shows, including “Fringe,” “Heroes,” “The Bachelor” and “Without a Trace,” as well as movies, such as Awakenings, Foxcatcher, Memento, Monster, Run Lola Run, The Illusionist, The Last Samurai and True Romance, without purchasing a subscription, according to Media Play News’ Stephanie Prange.

The launch is significant. Heretofore, AVOD was a distant stepchild to SVOD — the latter spearheaded by Netflix, Amazon Prime Video and Hulu. With a media landscape littered with SVOD and subscription-based online TV, ad-supported platforms offer an economical (i.e. free) alternative.

To be sure, Sony Crackle and Shout! TV have offered ad-supported content without subscription largely to niche audiences for some time. The Roku Channel upped the format by tapping into a user base of more than 27 million Roku subscribers — users who registered to the platform for access to third-party platforms such as Netflix.

The channel, which features catalog TV shows and movies, is now among Roku’s Top 5 accessed platforms. Roku recently licensed the platform to Samsung’s Internet-connected TVs.

“Strong active account growth and accelerating streaming hours point to consumers’ growing enthusiasm for [free] streaming,” said Roku CEO Anthony Wood.

Freedive takes AVOD to another level.

Long before there was Google, IMDb.com was the go-to source for actors, TV shows, movies and behind-the-scenes information. Through October, the platform had about 5.3 million titles (including episodes) and 9.3 million personalities in its database, as well as 83 million registered users. Subscription-based IMDb Pro is considered a must-have database for the business-side of Hollywood.

“Once you’ve signed up for Netflix and Amazon and Hulu, you’re more than $30 deep,” Colin Petrie-Norris, CEO of Xumo, an-ad-supported live TV/on-demand platform, told Digiday.com. “Price-sensitive consumers are seeing [free video streaming services] as viable alternatives or complements to paid services — that’s probably the biggest factor.”

Los Angeles-based Pluto TV launched in 2013 featuring about 100 channels via an ad-supported app that operates on 14 platforms, including Apple TV, Android TV, Amazon Fire TV, Chromecast, Roku and PlayStation consoles.

Last August, Irvine, Calif.-based Vizio rolled out WatchFree, a proprietary ad-supported streaming video platform that partnered with Pluto TV featuring action movies, black cinema, news channels, NBC News, MSNBC, Fox Sports and related fare.

NBC Universal plans to roll out an ad-supported streaming video service in 2020. The media company Jan. 14 re-organized its management structure to accommodate the future streaming service.

Bonnie Hammer, who was named chairman of direct-to-consumer and digital enterprises, will also oversee NBCU stakes in digital media outlets, including Vox, Snap and BuzzFeed.

The ad-supported service will be available at no cost to NBC Universal’s pay-TV subscribers in the U.S. and major international markets. Comcast Cable and Sky will provide the service to their 52 million subscribers. An ad-free version will also be available for a fee.

Additionally, non-pay TV customers can purchase a subscription to the service. Consistent with the company’s long-standing strategy to distribute its content broadly, NBC Universal will continue to license content to other studios and platforms, while retaining rights to certain titles for its new service.

“Our new service will be different than those presently in the market and it will be built on the company’s strengths, with NBC Universal’s great content and the technology expertise, broad scale and the wide distribution of Comcast Cable and Sky,” said Steve Burke, CEO, NBC Universal.

Michael Pachter, analyst with Wedbush Securities in Los Angeles, doubts AVOD will threaten Netflix & Co. anytime soon. He considers the formats largely supplemental to SVOD.

“I’m sure that there are people who can’t afford Netflix who will watch, and there are a handful of subscribers who will defect from Netflix, but most subscribers appreciate the unique content available only on Netflix and will remain subscribers so long as there is fresh original content,” he said.

Amazon Quashes Ad-Supported Video Streaming Service Rumor

Amazon Oct. 25 nixed media reports the ecommerce behemoth planned to launch a free streaming video service under its IMDb.com brand and accessible via the Amazon Fire TV streaming device.

“We have no plans to build an ad-supported Prime Video offering for free at this time,” Dave Fildes, head of investor relations, said on the fiscal call.

First reported earlier this month by CNBC, the over-the-top service reportedly would have offered catalog movies and TV shows – with advertisers getting access – for the first time to proprietary user data.

With Amazon spending $5 billion on original content for its Prime Video platform this year, and user data a coveted proprietary asset, the likelihood of an in-house competing video streaming service seemed farfetched.

Then again, ad-supported video streaming is the backbone of The Roku Channel, Hulu’s entry-level subscription plan, Sony Crackle and Shout! Factory TV, among others.

 

Vudu Inks Deal for MGM Original Programming

Walmart-owned Vudu.com reportedly signed a deal with MGM Studios for original content to be made available on the transactional VOD platform’s ad-supported “Movies on Us” service.

The deal includes exclusive North American access to original episodic series based on MGM intellectual property.

“We feel it will be a great source of family-friendly, advertiser-friendly content – which won’t be viewable anywhere else,” Scott Blanksteen, Vudu’s VP of product and ad-supported VOD, told Variety, which first reported the deal.

While media reports have suggested Walmart is dipping its toes into subscription video-on-demand distribution, Blanksteen said the MGM deal is not about SVOD, but rather ad-supported OTT video.

“I wouldn’t rule that out for the future, but there are no concrete plans or discussions for that now,” he said.

Launched in 2016, “Movies on Us” features a catalog of more than 7,000 catalog TV shows and movies free (with a Vudu account) to stream with commercials. Content providers include Paramount Pictures, Warner Bros., Lionsgate, MGM and Anchor Bay Entertainment.

The platform mirrors a growing number of ad-supported OTT video services such as The Roku Channel, Shout! Factory TV and Sony Crackle.

Vudu, which offers more than 180,000 studio movies to buy and rent, is also testing targeted advertising and direct-to-consumer ecommerce.

With Walmart actively promoting ecommerce in an attempt to better compete with Amazon, Vudu is testing direct shopping links as well as product information requests.

“Walmart tends to be a crawl-walk-run company,” Blanksteen said. “We feel like we are driving in the direction of building a great, on-demand network.”

Amazon’s IMDb.com Launching Ad-Supported Streaming Video Service

Taking a page from Roku and Hulu, Amazon reportedly plans to launch a free streaming video service under its IMDb.com brand and accessible via the Amazon Fire TV streaming device.

The service, which could be launched as early as this week, would offer catalog movies and TV shows – with advertisers getting access – for the first time – to proprietary user data, according to CNBC.com, which cited multiple sources familiar with the situation.

The IMDb service would be separate from Amazon Prime Video and enable Amazon to expand its digital advertising market penetration – currently around 4%, according to eMarketer.com. The marketing service said Facebook and Google have a combined 57% market share in digital advertising.

Ad-supported video streaming is the backbone of The Roku Channel, Hulu’s entry-level subscription plan, Sony Crackle and Shout! Factory TV, among others.

The Roku Channel launched in 2017, is now the fifth-most popular service on the Roku platform, according to the Los Gatos, Calif.-based tech company, which helped Netflix bow a branded streaming media device in 2008.

“Our users are looking for great free content, and with the launch of The Roku Channel we are making it easy for them to find it,” said Rob Holmes, VP of programming at Roku.

Needham & Co. analyst Laura Martin in August valued The Roku Channel at around $1 billion – about 20% of Roku’s market cap.