The Bulletin Edition 13

From The Desk of

I almost forgot that it was CES last week, the world's largest technology trade show that normally takes place in-person in Las Vegas but was demoted this year to that of exhausting Zoom calls and webinars due to the pandemic. However, my forgetfulness didn’t cost me anything monetary, unlike this poor chap who apparently can’t remember the password to his bitcoin wallet that contains $240 million inside and he only has two attempts left before it permanently locks forever.

I’m not sure how you can transfer the excitement and sparkle of CES if you are on Zoom all the time. I think those who say “in-person conferences are dead” seem to miss the need for real events to return because then all we attendees are in the same time zone. I am very close to registering for the online NATPE event however, I am realizing that contacts and clients in Europe or Asia will be sending me Zoom meeting requests for 10 pm at night or 4 am in the morning. Bring back physical events I say and I would rather suffer the jet lag or the proposed new sanitary logistics of flying.

This week has flown by so fast and for a good number of days, I didn’t have time to see what was going on in the industry at all, so it has been quite the catchup to push this issue out. On a good note, there has been some tweaking and new additions to this website. “Notes” is a new section that provides you with more behind-the-scenes insights into the makings of The Bulletin, along with some further planned pieces on productivity and other diversions. Yesterday I published a short post looking back over the first 3 months of this publication.

If you are already a registered subscriber of The Bulletin, you can sign up to receive Notes as an add-on, using the form below or you can send me an email and I will add you automatically to the mailing list. All future subscribers to The Bulletin will receive both issues. The Bulletin will remain the Sunday publication and Notes will be published on Wednesday. I am also working on moving each issue within an email as opposed to sending you all a link to to the new edition. There have been some comments as to why readers have to click on the link however the challenge of including embedded videos in these posts is that they are tricky to then include in the email format, so if anyone has some tips, please let me know.

As ever, thank you all for your support and words of encouragement and I wish you all the success for your coming week [C]

The Weekly Dispatch

CES

The consumer electronics show ran online last week with many differences in not only the set up but also the technology and products presented in the showcases. The theme of the show, from what I noticed in the media, was either “stay at home” or “keep your distance,” giving way to many new and of course, sometimes weird, gadgets and services to respond to the last 11 months of the pandemic.

Some of the key highlights were:

Kids: Homeschooling apps and platforms, healthy living and wellness such as meditation or mindfulness apps. VR/AR devices, while still in early-stage growth, 2021 is predicted to see an uptick in immersive experiences. Money management for kids: allowance and budgeting apps.
Streaming: No surprise here. The news came out that the avg U.S. household now subscribes to 4 paid streaming services and Disney took just 5 months to reach the same subscriber numbers that it took Netflix to reach in 7 years. As the older demographic also adopt streaming, the whole unbundling of the traditional TV market will continue to unravel well into 2021.
Wearables: From fitness devices to advanced facemask technologies, any and all things related to personal devices that connect with health or entertainment platforms and fitness gear were in the top discussions.
Gaming, large displays and audio tech for the home: Continuing the “at home” trend, new gaming laptops, 8K displays and new audio devices and software for in-home recording studios were hot topics.

Netflix puts its foot down

With financial results time just around the corner and with many of us interested to see where the growth will come from this time (especially after the price hikes) Netflix announced this week a large slate of programming for 2021 to firmly put a foot down to establish itself as the streaming service that subscribers will want to keep paying for. Stating that they will be “releasing a new movie every single week of 2021,” IGN covers in full the programming content coming to the platform for the year ahead.

Univision launches Prende TV

Univision has announced plans to launch a new ad-supported streaming service called PrendeTV, aimed exclusively at the U.S. Hispanic market. The broadcaster plans on launching the new service in Q1 of this year will at present be the only streaming service created exclusively for the U.S. Hispanic audience. All programmes will be in Spanish and will consist of 3030 channels and 10,000 hours of VOD programming from global content partners. Shows will include movies, global television series, comedy, sports and documentaries. Subscribers will be able to watch the content via the Prende website but also on mobile and connected TV apps.

Discussed

As mentioned in last week's issue, the previous Focus section will soon be re-launched as a new format and will be unveiled shortly. Discussed covers a few notable topics that came up this week during my interactions on social media and in communication with colleagues that I think are worthy of sharing. Hopefully, they will get you thinking and additional contribution to the topics are always welcome so please get in touch.

The entertainment industry is expanding: I have always looked outside of the traditional entertainment sphere of music, film and television and beyond into other industries to see how trends in those could affect trends in entertainment. Service and consumer industries such as transport, travel and hospitality as well as healthcare and wellness or home improvement all are now playing a much larger role in how we interact with mobile devices, TV screens, smart speakers and smart home devices. The rise of home fitness is powering demand for large screen TVs (that have replaced the gym mirrors) and wearables, both of which then encompasses music, health statistics and interaction with the TV (note to my predictions in edition 11) Fitness companies like Peloton are becoming new revenue streams for music labels and platforms like Roblox and Fortnite are new distribution platforms for movies and live concerts. Many sectors of traditional entertainment will bounce back, as many of these trends have been pandemic accelerated, however one thing is for sure, the entertainment industry will never look the same as it did in February 2020.

Go big or go small?: In the very first issue of The Bulletin I wrote about Revolut, a British financial company and consumer banking solution that had announced that their banking app will now come with a built-in “digital subscription management” tool that will allows users to see all their micro-subscriptions (such as Netflix, Prime, Dropbox, e-newspapers etc) all in one place and then budget and trim if need be. This week, news came out that streaming services will now have to inform the subscriber before a free trial ends or a subscription is about to expire so that the subscriber has a chance to decide if they wish to cancel. The state of California already has this requirement (ARL - automatic renewal law) and now the state of New York will also be adopting the law. This means streaming platforms like Netflix and Disney+ will have to clearly inform the subscriber and receive their consent that they wish to renew their subscription or that they wish to convert a free trial into a paid subscription. I do think this was a long time coming and even during the same week, someone found out that Netflix had been charging them a monthly for their physical DVD subscription service (yes it still exists) for the past 13 years even though he had never used it. Subscription management will be the next big thing for streaming services and all personal digital subscriptions, which will pose interesting strategies for tackling churn if subscribers can easily unsubscribe at the touch of a button or sign back up again as they wish. We may see streaming services moving towards longer packages but with a discount instead of the monthly fee. For instance instead of $10 a month, when the avg lifetime value of your subscriber is $60 (i.e they typically churn out after 6 months) the service offers a 12-month package for a one-time fee, but for $60, meaning the streaming service benefits from guaranteeing at least the avg. lifetime value based on user churn, yet the subscriber thinks they are getting a great deal. This could get quite interesting.

The home TV is back: It wasn’t that long ago when the family television set was destined to disappear into the basement, gathering dust while we all sat on our iPads each watching something completely different while still sat next to each other (that does happen if you have teenagers) Now the big TV is back and not just for movies due to cinemas being shuttered. With the price of connected TVs dropping all the time (a trend for Roku TVs and other embedded TV platforms where they can cope with small or zero (or even loss) margins on the TV hardware just to get their OS into your home) the television is once again becoming the centrepiece of the family home. Gaming, home fitness, working from home, schooling from home (see last week's issue on the BBC providing TV-based curriculum) has seen a large increase in TV upgrades. The other attraction is that now you don’t need to rent a U-Haul truck to pick up your new 80-inch 4K TV from the electronics store at the mall. Amazon delivers it to your home for free!

Not everyone is bothered by ads: There were a few heated discussions this week regarding FAST channels and AVOD services on the topic of “the ad situation on streaming is just going back to what it was like on cable TV and streaming is one of the reasons people are leaving cable TV and now it’s all ads again!” There seemed to be an opinion that ad-supported models are just a fad and that the viewer will eventually want ad-free options. I do agree, but not for this same reason.
Firstly, ad-supported models should be used as an upsell to a paid service of the same channel. The ad-supported service could carry one episode of a show or older catalogue content as a hook to get the viewer to upgrade to the full ad-free service. Running an ad-supported model as a standalone service will prove to be a tough model to keep running in the future.
Secondly, we have an entirely new generation of TV viewers now, who are used to more ads being served to them than ever before on mobile apps, YouTube and social media. Research came out this week that 75% of younger consumers are spending increasingly more time on ad-supported and lesser-known (and free) platforms. These are not the same TV watchers that used to have to put up with five minutes of Oprah and then 15 minutes of ads, as many of them never had cable in the first place. I do not believe in the consumer's mind there is anything wrong with ads, however, in order for the ad-supported model to be sustainable, there has to be paid options.

Is casual gaming the next big play on OTT?: Word sneaked out this week that LG announced a partnership with Google to bring Stadia to its latest smart TVs in the second half of this year. LG will be the first TV manufacturer (outside Google TV) to come with Stadia gameplay support. While many other TV manufacturers are pushing their prices down to drive up adoption of new connected TVs, LG wants to see growth in the high-end TV marketplace where users can play Stadia games such as Cyberpunk, Assassin’s Creed and Watch Dogs with just the Stadia controller and no additional hardware of game downloads needed. With gaming consoles increasing in price (and rarity in the case of the PS5) it will be very interesting to see how far native gaming platforms can reach on TV hardware itself.

On Point

158% - the estimated percentage increase of U.S box office sales in 2021 (although one to note, they have plummeted 85% since March 2020) (Wedbush Securities)

$1.22 - monthly subscription cost for the new Amazon Prime mobile-only plan in India (Amazon)

18.1% - estimated percentage growth of wearable technology sales in 2021 (Gartner)

52 million - number of subscribers NBCUniversal’s Peacock streaming services aims to have by 2024, with revenues of $1.96 billion (Macquarie)

47% - the percentage of Netflix’s workforce that were women in 2020, showing much-needed gains in representation for women and minorities. This also represents at the leadership level as well (Netflix)

80.6% - the percentage of the UK’s music consumption that happened by way of online streaming in 2020 (BPI)

$112 billion - estimated global spend on streaming services in 2021, up 11% on 2020 (CTA)

27% - the percentage of U.S. households that plan to cut the cord by the end of 2021 (YouGov)

50 inches - the size of the new Roku 4K connected TV now available in Brazil through a hardware partnership with Philco (Roku)

Productivity

I only found out about Google Primer this week and am surprised that it doesn’t seem to have been marketed much by Google or the media. With so many online course hubs, tutorials, webinars, how-to’s and all other manner of resources for learning, Primer is similar however, there is one very attractive difference. All the tutorials on Primer are only 5 minutes long. Perfect to learn about coding or SEO, launching your brand online, business development or marketing, all while you’re waiting for the kettle to boil or perhaps brushing your teeth.

One To Read

I had to almost pull out the library ladder to find my copy of this weeks One to Read. First published in 2018 (I think I was on the pre-order waitlist) it has been gathering dust for a while so please excuse the dog-eared appearance.

Tien Tzuo’s book “Subscribed” is a good read and I do recommend that the contents will be very useful to any reader who is interested in the subscription economy, however, I re-read it this week to see how it stands in the current climate some two years after it was initially published and especially when all manner of subscription services have taken off across all industries and sectors.

The first 12 chapters and 158 pages provide some very informative insights into the history of subscriptions and the end of “ownership” but then when we get to the exciting part of how to build and grow a subscription service, the author jumps straight into “so you’ve come up with your great subscription idea and are ready to launch” and then there is only half a page on churn, two pages on upsells and cross-sells and one page ongoing international and then a few more pages on pricing and then that’s it. You’ve reached the final appendix. Perhaps a revised version is in order?

Diversion

This interesting video popped up in my feeds this week as a sneak preview into the future of how online grocery shopping picking and packing will be serviced by robots. As I started to watch the video, I suddenly realized that this warehouse is, or should I say was, located in the small town in England where I was born, went to school and spent some of my youth. The warehouse burnt down in 2019, taking all the robots with it. Still, I can only imagine that robots are back to life in many other warehouse locations around the world, fulfilling orders while we work from home.

Visual Insight

And Finally

Portugal shows broadband infrastructure cracks

With the surge of online schooling and lockdowns fuelling all other manner of bandwidth-hogging devices and streaming services, it seems as though Portugal’s broadband infrastructure is starting to crumble to the point where the government is introducing new decrees in the coming weeks that could affect the access speed of platforms such as Netflix, YouTube and Disney+.

This Emergency Order states that operators can proceed with “other network and traffic management measures, such as blocking, slowing down, altering, restricting or degrading content, in relation to specific applications or services or specific categories”.

The art of sound

Towards the end of 2019, I read an article on Quartz (sadly now behind a paywall) discussing how headphones are changing music because the output devices for sound have shifted from live performance to gramophones, to radio, through mono to stereo and then to home audio systems and now headphones. The article mentioned that music in the eighties and nineties was more about the big sound, with strong vocals (think Whitney Houston) that had a full, bold sound when played on home audio systems, whereas now the tone of music in some popular genres is quiet and more subtle, hence the name “whisper pop,” that could be more suited to the close proximity of headphone listening. Regardless of how technology is changing and how we listen to music and how music is created, this video from the Wall Street Journal gives a unique and fascinating insight into the craft of the audiophile and how, for many, music really is about just finding the perfect sound.

This concludes this week’s edition of The Bulletin. If you would like further details on anything mentioned or have questions or suggestions that you would like to discuss on email or to schedule a call, please drop me a note.

Cheers and thank you for your support and I wish you all the success for your coming week.