The Bulletin Edition 7
From The Desk of
With the U.S. heading into Thanksgiving last week, my emails started to drop off around Tuesday and industry and business news had slowed to an occasional drip by Wednesday evening. After the last few months of non-stop announcements, financial results, product launches (and fails) this weeks edition of The Bulletin has given me some time to pause, to think about 2021 and what lies ahead in the media and entertainment world we live and work in.
Having taken a zero-tolerance approach to spam and marketing emails this year (thanks to a small investment to use Hey for all my email) I nearly forgot about Black Friday until one email managed to sneak through to my “imbox” and I happily signed up for a years subscription to the SVOD documentary service Curiousity Stream for the princely sum of $11.95. It was certainly a calmer transaction than waiting in line outside a big box store to then be trampled underfoot in the mad scramble. Despite recent price rises from Netflix, Spotify and many other services (including broadband providers like Comcast) there has been no shortage of streaming platforms eager to snap up as many subscribers as possible. Many of my friends in the U.S. swapped their usual Thanksgiving family gatherings around a large turkey, with a subscription to a new streaming service or a live stream of a concert, both of which they may not have done before. Thanksgiving photos shared on social media were of zoom calls or one, or two, sets of feet in front of the TV rather than 30 faces all crammed into a selfie at a festively adorned table. The New York Times even highlighted this week about how Americans are rethinking their holiday activities into something more quiet and comforting.
Despite most of this year being one of online shopping (including groceries), I did venture into the city with my daughter to visit the new Uniqlo location that had recently opened. We lined up for 30 minutes before the store opened (by then there were over 200 people in the queue) had a forehead temperature check and then wandered through the aisles in almost bewilderment. With online shopping, I know exactly what I am looking for and then just click on that category, add to cart and I’m done. Yesterday was like going back to the “old world” of in-person shopping where the entire website was thrown at me in the space of 30 seconds. Shoppers all around were complaining about the lineups, complaining about the waiting time to pay, complaining about how long it takes to return items previously purchased instore, complaining about lack of sizes. It was only 3 weeks ago that I ordered items from Uniqlo’s website and then returned some of them in a pre-paid FedEx envelope and that was it. Now, in-person shopping seems like such a bizarre and archaic activity that I would rather keep pre-pandemic (aside from my local independent retailers of course)
In closing this section of The Bulletin, it was extremely sad to read the news yesterday announcing the tragic death of Tony Hsieh, who is widely known to have revolutionized not only shoe e-commerce as CEO of Zappos but also is considered to be one of the pioneers of the entire e-commerce era. Hsieh believed that online customers should feel safe and secure when purchasing items and was the first to introduce free “no-hassle” returns and an unrivalled level of customer service. His book “Delivery Happiness” was the very first e-book I bought on my Kindle when it was first published more than ten years ago and is still one of my top timeless business books to read. The New York Times published his obituary yesterday.
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
You have to be everywhere
As covered in last weeks edition of The Bulletin, many local or national cable TV companies are finding the road ahead of them a tricky journey to navigate when the main competition, such as Netflix, Disney, Amazon and Roku are scaling up and rolling out on a global basis. The target audience for any entertainment company is now the world.
This week some of the final pieces of the distribution puzzle were almost put in place with whispers of HBO Max finally coming to Amazon devices after a long standoff and AMC arriving on Roku devices. Roku stock reached record highs this week after the announcement (it has doubled in 2020) and many think Roku will continue to rise as a dominant player in the platform market. Interestingly enough, Roku is still very much unknown in the UK and Europe, where Amazon Fire TV is the main contender. With the Amazon and HBO deal now in place, it’s just down to Roku and HBO to replicate the deal. Discovery also announced this week that they will be rolling out their own streaming service worldwide. Gone are the days of channels on one platform or service. If you are a platform or a channel you need to be on every single device out there in the marketplace including connected TV platforms. The only part that will remain exclusive is the content on your service, either original programming or localized programming for each of the territories you are targeting.
The future is clear, the consumer is not going to want to have to juggle multiple streaming platforms or remotes. They will want to access all their channels and services from one convenient supplier and that will be either Amazon, Roku or Apple. Sky in the UK now offers its TV service complete with Netflix and other streaming services usually associated to OTT platforms all in one customer environment, however, will the rest of the global pay-TV industry pick up the oars, or have they all missed the boat? Only time will tell.
A digital strategy must now be first
As we head towards the end of this unusual year, the entertainment industry has been waiting in the sidelines for something, anything, to happen that will shed some light on the future of the business. Movie production has been put on hold as cinema’s remain closed. Budgets have been paused, ad spending has bumped up and down, in-person entertainment experiences are closed (such as Disney Parks) and no one is sure how long all of this will remain on hold. Movie studios are waiting for the cinema industry and the cinema industry is waiting to see if the movie studios forge ahead with direct to consumer premium VOD and cut them out. As I read this week “it’s like waiting to see who blinks first.”
This week there have been many discussions in the industry about a digital-first strategy and finally accepting that “waiting it out” isn’t a good business model during a global pandemic. Channel 4 in the UK unveiled such an approach this week, putting into detail the four key pillars of their “Future4” model. A very interesting read indeed.
The Focus
Is this the end of the cinema era?
The first time I went to a cinema I was 8 years old and when I look back at that experience compared to today, the only part that has changed is back then the movie stopped halfway through and the nice lady came down to the front with the box lit up with ice cream tubs with wooden spoons hidden under the lids. Aside from that, the entire cinema business model hasn’t evolved or shifted at all. Yes the seats are more comfortable, the food is more varied (and expensive) and you can book tickets online but how the cinema fits into the lifecycle of film and the relationship with the film studios hasn’t changed since the cinema experience was invented. The movie studio finances the production and the cinema takes the largest share of the box office revenues without contributing anything to the making of the film. Their value is the number of seats in each theatre and the real estate they own (which is mostly anchored to malls and other entertainment complexes)
Fast forward 9 months and with most cinema’s still closed and even the ones that are open have reluctant audiences who are wary of returning, what does the future hold for the cinema industry now that some studios are looking towards releasing movies direct to streaming platforms or premium VOD? Disney has seen huge success on its own streaming service partly due to pulling some of its planned cinema releases out of the traditional distribution path and put that straight on their own platform. I strongly believe that children’s movies are perhaps the only genre that can work out of a cinema environment, simply because of the nature of families wanting to be together, safely, at home and the general cost comparison of taking the entire family to a physical cinema. I believe paying $30 to watch the latest Disney or children’s movie as a premium VOD offering compared to $120 in tickets and concessions at the cinema will actually increase the revenues for studios, especially as the cinema takes around 60% of the box office revenues.
At the same time, big-budget movies have always been made for the big screen. They are written, directed and produced to be watched in cinemas. They are not made to be watched on a small television set in consumer living rooms. The cinema still is a huge draw for viewers of the big blockbusters and I know many of us would not want a future with no cinema experience as much as we have enjoyed streaming to our heart’s content over the past 9 months. The cinema experience cannot be replicated on a streaming service. So either it has to change or hopefully, the industry can wait things out until it is safe to eat popcorn and lounge in a squeaky seat again for two hours.
In closing this piece, Emma Jones, writing for the BBC covers the future of cinema in this insightful piece and how the cinema sector in countries that are handling the pandemic better, could provide more of an insight to the future of the iconic big screen experience.
On Point
678 million - estimated number of global paying SVOD subscribers by 2025 (Digital TV Research)
20% - global percentage of all mobile game downloads this year that were from India (Sensor Tower)
70 million - number of tracks hosted on the YouTube streaming music service (YouTube)
61% - percentage of US broadband households that subscribe to two or more OTT services as of 3Q 2020, up from 48% the previous year (Parks Associates)
13.5 billion - number of smart home devices in active use by 2025, compared with an expected 7.4 billion at year-end 2020 (Juniper Research)
90% - percentage of U.S. households with children living at home that subscribe to more than one OTT service (Hub Entertainment)
9 years - the duration of your life that you will spend on your mobile device (Whistleout)
12% - percentage of workers in emerging economies (India, Mexico, China) who can work from home with the same level of productivity as at the workplace (McKinsey)
47% - percentage of total music streaming user penetration of YouTube, compared to Spotify’s 29% (Midia)
1 million - number of paying SVOD subscribers on the Hallmark Channel service (Crown Media)
Diversion
I think I might still be registered as a Hertz Gold member somewhere in their database, although I haven’t used their service for the last 10 years. In a previous life of weekly commuting to either New York or Los Angeles, Hertz was always there to guide me through picking up the keys and then wondering what speedy set of wheels waited for me in the “client zone.” Had I been upgraded? Would I notice any dings on the car when the Hertz employee made me walk-the-walk around the car while they held “that” clipboard? Did I need the GPS for an additional fee of $35 a day, or would my Blackberry with a tiny screen provide up to the second map instructions?
This week’s Diversion is a long one but a good one. Renting a car right from exiting the airport used to be a write of passage for any high-flying business person, although now the only memories of this era for me seem to be the famous scene from the film “Planes, Trains and Automobiles.”
Productivity
I joked with colleagues this week that sometimes it feels as though you neatly write out your daily to-dos over your morning coffee and then as soon as you open up your inbox, you may as well set fire to your to-do list. With all manner of task planners, to-do apps, the humble pen and paper, bullet journals, shared work hubs, project management systems and post-it notes, how did this all start? Where did the idea of a “to-do” list even come from and why do we even need them. Why can’t we just remember everything?
Lidia Dishman, writing for Fast Company, explores the humble origins of the to-do list and how over centuries, even the most famous philosophers, thinkers and artists had their own methods to put pen to paper and feel the accomplishment of crossing off tasks.
One To Read
2020 has been a hard year for reading books, especially from the non-fiction shelves. As mentioned before in previous editions of The Bulletin, books seem to end up in a grey zone of being relevant or completely out of date. A few weeks ago, my mailbox was stuffed full with a copy of “Collateral Damage: Britain, America and Europe in the Age of Trump” and now it seems as though I can’t quite fit it in my weekly-reading priority list.
“Culture Map” was another re-read this week, simply because it is not only such a great book but even in this new world of video meetings vs in-person meetings, the need to understand cross-culture communication is greater than ever, particularly as now there is no excuse to take your business or product global. The pandemic may have changed most areas of our daily lives but the one thing it has not changed is how we all communicate, behave and interact based on our nationalities, ethnicities and social and economic backgrounds.
Erin Meyer dives deep into areas such as “low context and direct negative feedback” listing countries and cultures that fit into a quadrant based on whether they are known to be direct in communication or indirect which can lead to one party feeling as though the other is blunt or rude when in fact it is more a cultural trait than a personality trait. With such an understanding of how countries around the world fit into this quadrant, it has certainly helped me to understand and be more aware of how to conduct business and personal relationships with friends, colleagues and customers around the world.
Not only is “The Culture Map” this weeks recommended read but I would put this book in my top 5 most essential reads for anyone who works in a global environment.
Visual Insight
Image credit: The Visual Capitalist
And Finally
The Reverse Migration
This week there has been continued development in vaccine trials around the world and we are now at the point where governments and health organizations are putting dates and plans to COVID-19 vaccination strategies. Not only has a vaccine never been created in such a short period of time but never before in human history has there been such a logistical challenge in administering the vaccine to a global population of 7.8 billion people.
The general consensus is that any vaccine (depending on its suitability to the candidate and the geographical region) will be administered to candidates working in the health care field and those on a risk level basis, especially those over a certain age and those of any age with vulnerable conditions such as blood, bone or lung cancer.
But then what happens when we move into vaccinating the wider population? We will start reaching a point where half have been vaccinated and half have not. Will we be adhering to social distancing and lockdown regulations until everyone has been vaccinated and what about those who do not want to be vaccinated? With some airlines and public event sectors saying they will require a vaccination certificate for consumers to fly or attend, this will certainly create a moral and ethical dilemma aside from the obvious logistical challenges.
When vaccinations are being rolled out to the wider population there will be many workers who will be eager to come back to the office but may not want co-workers who have not been vaccinated to be in the same space on a daily basis. How will companies monitor this employee divide? There is no doubt that the work from home situation has proven that there can be a place for hybrid working but the reality remains that the best business usually happens face to face and many large corporations have already stated their intention to bring everyone back to the office, even if on a part-time basis, once a vaccine is available.
The sub-headline “Get ready for the reverse migration” in this article from Inc. Magazine startled me somewhat, only because we have been living with social distance and the new concept of being apart from other people for almost a year now, with office buildings empty around the globe. It is one thing to think about moving your workforce out of the office and we have just about managed to work through that, now we have to think about how to and when to start bringing everyone back.
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.