Week In Review: Is Amazon Going To Be Your On-Demand MVPD?

Originally published at TVREV.com on December 4, 2015

We’re back from Thanksgiving and things are picking up this week. The biggest news came from Amazon and we’ll discuss that along with some interesting insights from Videonuze SHIFT and the TV of Tomorrow Show in New York City.

Amazon AggregatesThat’s been the news story on everyone’s lips this week as Lucas Shaw over at Bloomberg broke the story that the giant e-tailer was planning on aggregating other video services (movies and TV) and selling them via it’s successful Amazon Prime offering.

Prime, which, in addition to access to movies and shows like Transparent, gives subscribers free two-day shipping, looks like it is about to become a non-linear MVPD, offering a range of VOD content to subscribers, but no live TV.

Why That MattersWe’ve been predicting that the MVPDs will soon step up to the plate and start selling streaming/OTT services along with their traditional pay-TV packages, thus making cord cutting a non-issue. So long as you get your broadband connection through them, the MVPDs won’t much mind what kind of pay-TV services you choose.

So Amazon’s decision to aggregate all the other streaming services isn’t that much of a surprise and makes good business sense.

The issue for consumers will be who you want to pay. You’ve got to pay Charter or FIOS or Comcast for broadband service no matter what. So then the question becomes do you pay them for broadband plus Amazon Prime and let Amazon handle your on-demand subscriptions. Or do you let Comcast take care of all your OTT bundling and maybe even throw in some live sports and/or news channels for you.

Why That Really MattersData. Data is the gold of the internet era, and in the above scenarios, it’s either going to be the MVPDs or Amazon who collects that data. Which one is better is a trickier call for content owners. On the one hand, they don’t want the Comcasts of the world owning data about their viewers that can then be used against them in carriage fee negotiations. On the other hand, they don’t want Amazon owning that data either, if they’re going to use it to create their own original programming that competes with the networks’ own shows. Sort of a classic devil-you-know versus devil-you-don’t scenario.

What You Should Do About ItAt this point, the best course of action it to watch and see how this plays out, or, more accurately, to see if it even does play out: it’s quite possible that Amazon won’t be able to put the deals together, or that the deals they put together won’t be anything consumers get excited about. While Amazon Prime has been very successful (it’s estimated that around 40 million people subscribe in the US), that’s not because of it’s TV interface, which leaves a lot to be desired. So any product they come out with is not going to be an automatic slam dunk.

Notes From SHIFT, the VideoNuze Conference

AdTech Is Still Anyone’s Game: If there was one thing everyone at Videonuze’s SHIFT conference seemed to agree on, it was that things needed to change, that the current practice of buying TV advertising by day part was outdated and that the industry needed to implement a way to enable “audience parting” so that advertisers could reach specific audiences. How, when and where that would happen was the part everyone seemed uncertain about.

A few themes that kept turning up were the need for creative that matched the new reality where viewers might be binge watching on a big screen TV late at night or watching on a phone while standing in line at the bank. There was also much talk about Nielsen’s new TAM system, and how there technically were more accurate ways to measure viewership (e.g. MVPD set top box data) but no one had any strong ideas on how to get all the relevant parties to agree to use them.

What You Should Do About It:If your ad salespeople aren’t busy looking for ways to make audience parting happen, kick them in the shins. Hard. This is the future and whoever gets to that future first is going to have a big first mover advantage. Keep your eyes on what everyone else is doing though too—like most industries, there is lots of lemming-like behavior, so if something seems to be taking off, run, don’t walk.

Notes from the TV of Tomorrow ShowPeriscope Stars Are Real: One of the most interesting panels featured the stars of Periscope and YouNow, a four-year old platform that’s been pushing Meerkat out of the way. The stars ranged from a social media expert to an artist, a 17 year-old musician and a sports reporter. They’ve all amassed thousands of followers and the artist and the musician are already making money off of it.

What You Should Do About It:The next time your digital team comes to talk to you about live streaming, listen to them. It’s going to be huge.

Advertising’s Not Dead. At Least Not Yet: Another panel featured TVREVers Jesse Redniss and Alan Wolk and discussed the potential death of advertising in a post-Netflix world. Panelists pondered the surprisingly lackluster adoption rate of Hulu’s ad-free option and the pros and cons of branded content and native advertising. Interactive plays from TruX and Innovid were dissected and the always outspoken Ashley Swartz reminded the audience that it was all about business goals, anyway. The verdict: advertising will become more targeted, but it’s not going anywhere soon.

What You Should Do About It:Breathe a sigh of relief. And then start looking into audience parting and why fewer commercials may be a better thing for everyone involved.