Netflix

Facebook Lasso app lead Brady Voss leaves for Netflix right after launch

Posted by | Apps, Brady Voss, Facebook, Mobile, Netflix, Personnel, Social, Talent, TC, tiktok, Video | No Comments

Facebook Lasso has a steep uphill climb ahead as it hopes to chase the musical video app it cloned, China’s TikTok (which merged with Musically). Lasso lets you overlay popular songs on 15-second clips of you lip syncing, dancing or just being silly — kind of like Vine with a soundtrack. It’s off to a slow start since launching Friday, having failed to reach the overall app download charts as it falls from No. 169 to No. 217 on the U.S. iOS Photo and Video App chart, according to App Annie. Sensor Tower estimates Lasso has been downloaded fewer than 10,000 times across both iOS and Android.

Forme Facebook Lead Product Designer Brady Voss

And now one of the Lasso team’s bosses, Brady Voss, is leaving Facebook for a job at Netflix. He’d spent five years as a lead product designer at Facebook working on standalone apps like Hello and major feature launches like Watch, Live, 360 video and the social network’s smart TV app. He previously designed products for TiVo and Microsoft’s Xbox.

“After five life-changing years at Facebook, my last day will be this Friday, 11/16,” Voss wrote on Facebook. “Following our launch of our new app, Lasso, a project I’ve been working on for a while now, the timing works well to explore what’s coming next…. As for what’s next? I have accepted a position at Netflix in Los Gatos, California.” A Facebook spokesperson responded that “Yes, I can confirm that Brady is leaving Facebook.”

Voss added some color about joining Facebook, noting, “There was actually a discussion about whether or not I’d be a great culture fit because I wore a tie to my interviews–which is funny because we don’t believe dressing like that is what enables people to bring their best everyday. Thankfully, they saw past the common clichés–because suits and ties are not me.” As for Facebook’s troubles, he wrote that “I was even there for the big freak out moments along the way–we’ll keep them unnamed 🙃”, which could refer to his work on Facebook Live that spawned big problems with real-time broadcasts of violence and self-harm.

While it’s reasonable for anyone to want a change of pace after five years, especially after the brutal year Facebook’s had in the press, his departure just a week after Lasso’s launch doesn’t inspire a ton of confidence in the app’s trajectory. It might have been a sensible stopping point haven gotten the app out the door, but you’d also think that if Lasso had a real shot at popularity, he’d have wanted to stick around to oversee that growth.

Lasso’s first rodeo

TechCrunch first broke the news last month that Lasso was in development, citing Voss as one of the team’s heads. But in the meantime, the world’s highest valued private startup ByteDance managed to push its TikTok app past Instagram, Snapchat and YouTube on the download charts. It’s now at No. 5 on the U.S. iOS overall charts and No. 1 in Photo and Video. Facebook seems to have shooed Lasso out a little prematurely before losing more ground, given it lacks many of the augmented reality features and filters found in Instagram, Snapchat and TikTok .

Facebook Lasso

TechCrunch asked the company for some more details about the Lasso roadmap. A spokesperson told me that Facebook will be evolving Lasso and adding new features with time, and may test a feature for uploading videos instead of being restricted to shooting them in-app right now. Voss’ departure post includes a “Made With Lasso” video featuring an augmented reality effect with him conjuring Facebook Like thumbs-ups out of his hand. [Update: He tells me he added this in AfterEffects, but it shows that Facebookers think AR should be part of Lasso.]

As for monetization, Facebook tells me there are no plans to show ads right now. Typically, Facebook tries to build products to have hundreds of millions of users before it potentially endangers growth by layering in revenue generators. I asked if users might be able to pay their favorite video creators with tips, and the company says that while that’s not currently available, it hopes to explore ways to allow creators to earn money in the future. Instagram said the same thing about IGTV when it launched in June, and we still haven’t heard anything on that front. Facebook likely won’t be able to lure creators to new platforms with smaller audiences than their main channels unless it’s going to let them earn money there.

If Facebook is truly serious about challenging TikTok, it may need to build closer ties between Lasso and Instagram. Facebook left its previous standalone video apps like Slingshot and Poke out to dry, eventually shuttering them after providing little cross-promotion. Given the teen audience Lasso craves is already on Instagram, it will be fascinating to see if former VP of News Feed Adam Mosseri, who’s now running Instagram, will insert some links to Lasso. A Facebook spokesperson says that Facebook may investigate promoting Lasso on its other apps down the line.

And one final concern regarding Lasso is that Facebook isn’t doing much to prevent underage kids below 13 from getting on the app. Tweens flocked to Musically, leading to some worrisome content. Ten-year-old girls in revealing clothing singing along to the scandalous lyrics of pop songs frequently populated the Musically leaderboard. That prompted me to question Musically CEO Alex Zhu onstage at TechCrunch Disrupt London 2015 about whether his app violated the Child Online Privacy Protection Act (COPPA) that prohibits online services from collecting photos or videos of kids under 13. He denied wrongdoing with flimsy excuses, claiming parents were always aware of what kids were doing, and stormed out of the backstage area after our talk.

So I asked Facebook how it would prevent such issues on Lasso, where all content is public and adults can follow children. A spokesperson told me that you need a Facebook or Instagram account to sign up for Lasso, and those services require people to be 13 older. But “require” isn’t exactly the right word. It asks people to state they’re of age, but doesn’t do anything to confirm that. Lasso does have a report button for flagging inappropriate content, and the company claims to be taking privacy and safety seriously.

But if the tech giants are going to build apps purposefully designed for young audiences, asking for kids to merely promise they’re old enough to join may not be sufficient.

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Live streaming studio, Culture Genesis, launches its first show, the quiz-based Trivia Mob

Posted by | Apple, Culture Genesis, executive, Gaming, HQ Trivia, Jeopardy, live streaming, Los Angeles, mlb, Netflix, player, qi, TC, United States | No Comments

A new generation of entrepreneurs is emerging to refashion the Los Angeles studio system for the digital age, forming companies that combine live-streamed video, podcasts and the newfound social media celebrities to craft entertainment for a new breed of consumer.

Two of those startup founders, longtime Apple executive Cedric Rogers and former developer for VEVO and MLB digital Shaun Newsum, are now pulling the curtains back on the first fruit of their production studio, Culture Genesis, with the launch of TriviaMob — a new quiz show targeting urban audiences.

The two creators envision their company as a combination of 106 & Park and Jeopardy with questions aimed at cultural references for the Highsnobiety and Complex set.

TriviaMob banner

TriviaMob players can win up to $10,000 in cash by competing individually or as part of a group (or “mob”) to win collective prizes by tuning in and competing to shows that stream every Sunday. Each player has 10 seconds to answer 10 questions around art, music, science and history. Players that answer all of the questions correctly will get a share of the $10,000 prize and participants who opt to be part of the “mob” can earn points for sponsored prizes.

For its foray into live-streamed appointment entertainment, Culture Genesis has tapped Melvin Gregg, the influencer and star of Netflix’s American Vandal series along with a host of… well… hosts, including former Miss USA contestant, Brittany Lucio; DJ Damage, the co-host of Sean “P. Diddy” Combs’ flagship show, REVOLT Live; Jessica Flores; and TV host and comedic actress Dariany Santana.

Backed initially by Los Angeles-based accelerator MuckerLab and Betaworks’ latest LiveCamp program, the two founders see Culture Genesis as tapping into the twin trends of gaming and mobile technology adoption in young African American and Latinx communities. The founders cite statistics indicating that 73 percent of African Americans and 72 percent of Latinx consumers over 13 years old identify as gamers.

“We’re building software for an urban, multicultural audience that continues to lead and influence culture — not just in the U.S. but around the world,” said Rogers, in a statement. “We see this influence growing in Hollywood but it’s not happening fast enough in Silicon valley. We want to accelerate this shift.”

The business model mimics that of HQ Trivia, the once-popular quiz show whose success has waned even as it scored massive gains in venture fundraising — valuing the company at a reported $100 million.

But the founders of Culture Genesis see their first product as fundamentally different from HQ. “People want to see things for them by them,” says Rogers. “From our perspective HQ meant nothing to our audience.”

Newsum, the company’s chief technology officer, goes even further. “I think HQ was a prime example of our thesis. HQ from a multicultural perspective — that didn’t appeal to our audience. Part of what we’re doing with Cultural Genesis is bringing that urban understanding.”

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Netflix’s hackathon produces a way to navigate its iOS app with ARKit and Face ID

Posted by | Apps, augmented reality, face id, hackathon, Mobile, Netflix | No Comments

Netflix’s internal hackathons have consistently produced fun and often silly hacks, from that “Netflixtendo” hack a few years ago that let you run Netflix on the original NES to the more recent “audiobook mode” that turned Netflix series into old-school radio shows by way of Audio Descriptions. This year’s hackathon doesn’t disappoint either, with new hacks that are both as goofy and interesting as in years past, including an AR and Face ID-powered hack that lets you navigate Netflix with just your eyes, another designed for “Sharknado” fans and more.

“Jump to Shark” lets viewers skip right to the good parts of the so-bad-it’s-good “Sharknado,” so they can watch the bloody action sequences with sharks, instead of having to sit through the movie’s actual plot. It’s pretty great, as the video shows.

The AR hack, Eye Nav, is fairly impressive, too.

The hack uses Apple’s ARKit and the technology that enables Face ID for tracking eye position and facial expressions. It tracks your eye position to move a pointer around the screen, then measures the time spent on the same area to trigger a “tap.”

If you want to dismiss a screen, you can just stick your tongue out.

While the resulting hack is definitely fun, there are also implications for accessibility use cases in the future.

The hack was produced in 24 hours, so it may not be stable enough for real-world use, but it’s definitely an interesting idea.

A third hack doesn’t involve Netflix, but rather the productivity software Slack, used by Netflix employees.

“LunchBot” connects co-workers who are too busy to go to lunch, by inviting them to eat lunch together — virtually, while in a Slack chat. The app also checks everyone’s calendars to make sure they’re free.

Other hacks this year included those for product improvements, enhancements to its internal tools and some that were just for fun. A few of these were showcased in its Hackday 2018 video, such as a map for locating studio production resources, an “easy login” system and a version of Animoji using Netflix characters.

But the larger goal of Netflix’s hackathon, as you can probably tell, isn’t necessarily about creating features that will later be productized (although, c’mon…Jump to Shark!), but they sometimes serve as inspiration for features further down the road, the company says.

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Consumers spent $329M on the top 10 subscription video apps last quarter

Posted by | Apple, Apps, Google, Media, Mobile, Netflix, sensor tower, subscriptions | No Comments

Last year, the top subscription video apps like Netflix and Hulu raked in a combined $781 million, and that trend is showing no sign of slowing down in 2018. In the third quarter of 2018, U.S. consumers spent an estimated $329 million in the top 10 subscription video-on-demand apps across the App Store and Google Play — a figure that’s up 15 percent from the $285 million spent in Q1.

The data is the latest in a new report from app intelligence firm Sensor Tower, which has been following the growth of subscription video apps for some time. Last year, for example, it found that Netflix’s app topped the charts in terms of revenue, when compared with all the other non-game apps on the market.

Netflix hasn’t fallen from its top-ranked position, the new data shows. In fact, it’s continuing to grow.

The app pulled in an estimated $132 million in consumer spending across the app stores in Q3, which is up 78 percent from the $74 million spent in the third quarter of 2017.

However, Hulu is now growing faster, the report found. It saw subscription revenue jump 86 percent to $39 million, up from $21 million a year ago.

It seems some consumers may have made the move to Hulu thanks to the extra cash they had on hand, thanks to dropping their HBO subscription.

The only subscription video app that saw revenue decline in Q3 was HBO NOW, which took in $41 million in the quarter, down 40 percent from the $68 million in Q3 2017. But notably absent this quarter was the network’s biggest draw, “Game of Thrones,” which had been airing at this time last year. A drop was expected.

The top-grossing chart of these subscription video apps for Q3 2018 looks very similar to last year’s in terms of the apps included, and sometimes, even their rankings.

But two services made moves, the report says.

YouTube TV jumped from $3 million in the year-ago quarter to $16 million in Q3 on Apple’s App Store, thanks to its expanded market penetration and consumer adoption. And ESPN Live Sports, which added in-app subscriptions in Q2, grossed $4.6 million in the third quarter, up 119 percent from Q2.

Even CBS is doing well, despite the fact that not everyone loves the new “Star Trek.”

Still, it appears CBS made a good move by betting on fans’ devotion to the franchise, as U.S. consumers spent $6 million in the app in Q3 2018, up 50 percent from the $4 million spent in Q3 2017.

The report’s data includes subscription revenues only, not refunds or in-app advertising revenues, Sensor Tower notes.

The broad increases in consumer spending on these video apps is yet another example of the significant and growing subscription business — much of which is taking place on mobile. Subscriptions accounted for $10.6 billion in consumer spend on the App Store in 2017, and are poised to grow to $75.7 billion by 2022, an earlier report found.

However, the top subscription apps aren’t all video apps. Others that consistently rank highly in the U.S. include Tinder, Spotify and Pandora, for example. Currently, the top-grossing chart for the App Store includes a number of non-games, like Netflix (No. 1), YouTube (No. 2), Tinder (No. 3), Pandora (No. 4), Hulu (No. 7), and Bumble (No. 8).

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Gjemeni puts your couch in a box

Posted by | design, furniture, Gadgets, H&M, ikea, Netflix, Smart phones, TC, WeWork | No Comments

Gjemeni, pronounced Gemini, is a new furniture-on-demand service from founder Sean Pathiratne. The company offers decidedly tech-forward furniture that comes in a single box and can be assembled by anyone in a few minutes.

Pathiratne sees his company as a fashionable and agile furniture company that brings stylish stuff to your living room in the vein of Zara or H&M.

“We can create and deliver on trends through our technology-led global supply chain with the agility and speed of ‘fast fashion.’ We are ‘fast furniture,’” said Pathiratne.

“I live and work in Silicon Valley. I spend a lot of time in WeWork and other co-working places, in the offices of start-ups, and with tech friends,” said Pathiratne . “I observed how millennials live and work. They are a restless bunch physically – which mirrors their restlessness overall. They don’t like the status quo in business or with the objects in their lives. They are constantly shifting and fidgeting on their sofas. They just couldn’t find the right positions. After all, today we are checking our smart phones one minute, leaning back and contemplating the world another minute.”

The result? A plugged-in couch for the plugged-in generation.

“So the implications were obvious: create a multi-position couch for our multi-tasking world. A couch that meets people where they are, rather than the other way around. And also make sure that the next- gen couch had connectivity for the generation that is always plugged in,” he said.

The Gjemeni flagship is a convertible couch that turns from stark seating system into a lie-flat futon. Both sides of the couch have power and USB ports and it has three resting positions.

The company also sells a chair and an ottoman. Each product, from the $999 couch to the $299 leg rest, comes in a massive box that opens to reveal the furniture and a set of legs. To build the stuff you simply snap the legs into the holes on the bottom and flip the couch upright.

I tested one of the couches and can report that it would make a great startup-office seat. The styling, the firmness, and the clever charging ports mean that you can easily make your visitors feel powered-up and comfortable. As a home couch, however, I would recommend trying before you buy. First, at 6.5 feet long, there isn’t much room on the couch for more than two people let alone a small family. Further, the two reclining options are not conducive to many traditional couch activities except, perhaps, for the aftermath of Netflix and chill. The two sides of the back of the couch move from upright to reclined. When upright it is set at almost at 90 degrees – a TV lounging nightmare – and when slightly reclined you fall into a napping position. There is no “just right” with this couch for the home user.

That said this is furniture and your experience may differ. The company offers a 60-day money back guarantee as long as you keep the massive box and at $999 it makes perfect sense to take a flyer on this one. In fact, that’s the point. Like other furniture services, Gjemeni plans to disrupt the visit to Ikea or the furniture store. Because setup is so simple there is little harm in giving it a go and sending it back if you don’t like the size, the firmness, or the fit.

After all, said Pathiratne, the company is all about self-awareness.

“We are built to harness technology in pursuit of wellness. Gjemeni meets our ergonomic needs to relieve pressure on the back and spine, and to adjust so that we can take a power nap (we all know how important sleep is to wellness) or simply meditate and ground ourselves,” said Pathiratne.

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Live streams of karate and niche sports are terrifying major sports leagues

Posted by | Endeavor, Entertainment, espn, esports, Facebook Live, Gaming, Hulu, Media, mlb, NBA, Netflix, nfl, Sports, streaming TV, Twitch, ufc, Video, YouTube Live | No Comments

Of the 100 most-watched live telecasts in the US in 2005, 14 were sporting events; in 2015, sporting events comprised 93 of the top 100 telecasts. That shift occurred because TV shows are shifting to online or on-demand viewing, and live broadcasts of the biggest sports are the main thing TV networks have left to draw in live audiences. But the need to keep those sports on TV and off streaming services is only accelerating the rate at which young people are tuning into other sports leagues instead.

The rapid adoption of subscription video streaming services like Netflix and Hulu and of social live streams on Facebook, YouTube, and Twitch is enabling massive growth by sports leagues that you won’t normally see on TV. In the streaming era, more sports – and new types of sports like esports – keep thriving while interest in traditional pro leagues like the NFL and MLB declines.

OTT is where the growth is

The central narrative in the global film/TV industry right now is the response of incumbent companies to the growing dominance of Netflix, Amazon, and other streaming (aka “OTT” or over-the-top) services. The incumbents are merging to consolidate ownership of must-have shows onto a smaller number of new OTT services that will each be stronger.

The majority of American households have a Netflix subscription (i.e. access to one of Netflix’s 56M US accounts), another 20M have a Hulu subscription, the number of OTT-only households has tripled in 5 years, and 50% of US internet users use a subscription OTT service at least weekly. Almost one-third (29%) of Americans say they watch more streaming TV than linear TV, and among those age 18-29 it’s 54% (with 29% having cut the cord on linear TV entirely). People, especially young people, want to watch shows on their own time and on any device, and they get more value from a few $8-40 per month subscription platforms than a $100+ per month cable bill.

Meanwhile, social live-streaming platforms that got their start enabling people to either vlog or watch video gaming are expanding to all sorts of live broadcasting: Twitch averaged 1 million viewers at any given point of day in January, and there were 3.5 billion broadcasts over Facebook Live in the first two years after it launched (with 2 billion users viewing at least one).

We’ve hit the pivot point where media is streaming-first. Netflix is now the leading studio in Hollywood, spending $13 billion this year on content. Linear TV viewing is declining: every major cable network (except NBC Sports) has declining viewership and aging viewers. Between 2007 and 2017, the median age of primetime viewers on ABC, CBS, NBC, and Fox went up 8-11 years and are all in the 50s or 60s.

Major pro sporting events are the last bastion of TV networks because the dominant brands are, for the most part, only available live on TV. Beyond those, the only content getting large audiences to tune in simultaneously are a couple Hollywood awards shows and premieres or finales of a couple hit shows (Big Bang Theory and NCIS).

The exclusive broadcast rights to those live sports events – particularly the NFL, NBA, MLB, and top NCAA basketball and football games – are the last defense for major broadcast networks. They are the reason for younger Americans to not cut the cord. ESPN makes $7.6 billion per year in carriage fees from cable companies paying for the right to carry the main ESPN channel (the other ESPN channels add another $1 billion); that number is increasing even as ESPN’s viewership is declining.

Disney (ESPN’s owner) and other leading broadcasters don’t want to let people watch major sporting events online instead (at least not easily or cheaply) because doing so would pull the rug out from under their traditional revenue stream and OTT revenue (subscription + ads) won’t make up for it quickly enough. This problem is only exacerbated by the fact that TV networks are paying record sums for exclusive broadcast rights to top sports leagues out of fear that losing them to a rival could be a nail in their coffin.

This strategy is delaying, not stopping the shift in consumption habits. More and more young people are tuning out (or never tuning in) to the major pro sports on TV, and the median age of their audiences shows that: 64 for the PGA Tour, 58 for NASCAR, 57 for MLB, 52 for NCAA football and men’s basketball, and 50 for the NFL…and all are getting older. (Cable news networks, the other holdouts who are still doing well on live TV face the same situation: the average age of Fox News, MSNBC, and CNN viewers is now 65, 65, and 61 respectively.)

The major pro sports staying on linear TV has expanded the market opening for new sports to fill the open space with young people who mainly consume content online. In fact, a growing marketplace of different sports leagues (including esports) developing their own fanbases is an inevitability of the shift to OTT video as it lowers the barrier to entry to near-zero and let’s geographically dispersed fans unify in one place.

1. Lower barrier to entry for distribution

Lawn bowling is no longer your grandfather’s sports league. Mint Images/Getty Images

Niche sports leagues – or frankly, even big sports leagues that just aren’t at the scale of professional football, baseball, basketball, and hockey – have always had a hard time getting coverage on television. But you can produce and distribute video for an online audience more cheaply than for a television audience.

In fact with Facebook Live and Twitch, you can stream live video for free, and you can share clips across every social channel to attract interest. To launch your own OTT service or partner with an existing one, you don’t need to start with a massive audience from the beginning and you don’t need millions of dollars from sponsors just to break even.

Having signed over 150 new deals this year alone for its 20+ sports verticals (which will stream 2,500 live events in 2018), Austin-based FloSports has established itself as the go-to OTT partner for sports leagues with an established, passionate following that aren’t massive enough to garner regular ESPN-level coverage.

From rugby, track & field, and wrestling to bowling, competitive marching band, and ballroom dance, millions of Americans have participated in these activities in their youth and through clubs as adults but rarely see them on television. In fact, the rare instances when such sports are on TV – like their national championships – the league is usually paying large sums (potentially hundreds of thousands of dollars) for that airtime rather than getting paid by the broadcasters.

FloSports gives a home to the superfans of its partner leagues, with full coverage of the sport and commentary meant for real fans. It produces events in the manner best fit to highlight the action and turns superfans – who generally pay a subscription – into evangelists who recruit friends. There are numerous sports that have millions of participants yet no active, high-quality event coverage; those are underserved markets.

By tapping into this, FloSports properties (like FloWrestling, FloTrack, etc.) have gained hundreds of thousands of subscribers and created a surge of interest in teams like Oklahoma State’s wrestling team, which saw an 144% increase in live stream viewing and 68% growth in event attendance after joining FloWrestling (leading to them to set an all-time attendance record in the university’s basketball arena of 14,059 people). In the first half of 2018, FloSports’ various Instagram accounts collectively received 307M video views, more than the collective accounts of Fox Sports or of all NFL teams (and NFL Network).

2. Going global right away.

Johanne Defay of France at a World Surf League event. Mark Ralston/AFP/Getty Images

The top pro sports leagues have geographically concentrated fan-bases that fit the geographic restrictions of TV broadcasters, which end at a country’s border. Online streaming empowers sports that have large fan bases who aren’t geographically concentrated to aggregate in the digital sphere with enough eyeballs (and paying subscriptions) to drive engagement with the sport’s content through the roof.

Since being acquired in 2015 and renamed World Surf League, the governing body of professional surfing has developed a large global following – with 6.5M Facebook fans and 2.9M Instagram followers – through the launch of live streams and on-demand video on its website and mobile app, plus partnering with third-parties like Bleacher Report’s OTT service B/R Live. Only 20-25% of WSL’s viewers are in the US but since its competitions are streamed direct-to-consumer online, they were able to reach surfers around the world right away. After seeing WSL’s Facebook Live streams garner over 14M viewers in 2017, Facebook paid up to become the exclusive live-stream provider for WSL competitions for two years, beginning this past March.

3. Immediate data on audience engagement.

As with all offline-to-online shifts, OTT video streaming captures dramatically more data on audience demographics and engagement than television does, and it does it in real-time. This makes it easier for emerging sports leagues to partner with advertisers and show immediate ROI on their sponsorships, plus it informs their understanding of how to produce their particular type of sporting event for maximum audience engagement.

Karate Combat is a year-old league that builds off the existing base of karate participants and fans around the world (numbering in the tens of millions) with a new competition format specifically intended for OTT. The league allows full-contact fighting and sets the match in a pit (rather than a traditional fighting ring) for better camera angles. It also replaces the traditional focus on having a big in-person audience (which is expensive) and instead sets the fights in exotic locations (like the fight this coming Thursday night on top of the World Trade Center).

Like many emerging sports leagues, Karate Combat is vertically integrated: the league organizing the competitions is also the one producing and streaming the event coverage over its website, mobile apps, and social channels. This not only means it captures the content-related revenue from subscribers, advertisers, and numerous OTT distribution partners, but it sees every data point about fans’ viewing behavior and their interaction with various dashboards (like biometrics on each fighter) so they can optimize both online and offline aspects of the production.

4. Online means interactive

Jujitsu fighting is now an OTT service. South_agency/Getty Images

Online viewing creates the opportunity for functionality you can’t achieve with linear TV: interactive displays overlayed on or next to live video. Viewers can pull up and click through real-time stats, change camera views, or switch overlays (think the the yellow first-down line in NFL broadcasts or coloring around a hockey puck to help you track it on the ice). Ultimately, a more interactive experience means a more social and more entertaining experience (and the sort of deep engagement advertisers value too).

FloSports’ ju-jitsu live streams (FloGrappling) give subscribers multiple live cameras each covering simultaneous matches on different mats so they can click between them. This is a more personalized experience than passively watching one broadcast on TV and it gets that subscriber actively engaged, with their behavior providing valuable data points for FloSports and their deeper interaction likely more compelling to event sponsors.

The display might also highlight live comments from friends or friends-of-friends in order to draw viewers into a more social experience. Discussion of a specific live stream with others watching it has been a central feature for Twitch and Facebook Live and enables the league or team streaming the event to directly engage with fans around the world.

An exception to the OTT-first strategy may be in sports that are entirely new and have zero existing base of participants or fans. Karate, surfing, and video-gaming all have millions of passionate participants around the world, going back decades. A new league like the 3-year-old Drone Racing League (DRL), which has raised $21M in venture capital to develop the sport of competitive drone racing, has to artificially stimulate the development of a fanbase if it doesn’t want to wait years for grassroots competitions to create a critical mass of fans even for a niche OTT service. It’s unsurprising then that DRL has focused on striking TV deals with ESPN, Sky Sports, ProSiebenSat.1, and others to thrust it in front of large audiences from the start, like a new game show hoping its format will entice enough people to take interest.

Power is in the hands of the league owners

Ari Emanuel, chief executive officer of William Morris Endeavor Entertainment. Jonathan Alcorn/Bloomberg via Getty Images

The best position to be in right now is the owner of a sports league that’s rapidly growing in popularity. The competition for audience by both traditional media companies and tech platforms leaves a long list of distribution partners eager for must-have, exclusive content – especially content like sports events that fans want to want live together – and willing to pay up.

Moreover, vertical integration to control your fans’ content viewing experience and own your relationship with them has never been easier. There are direct subscriptions, advertisers, event sponsors, event tickets, a portfolio of possible OTT distribution deals, and merchandising. The potential revenue streams a league can develop are only more numerous when you add in launching a fantasy sports league – like World Surf League has done – and the recent nationwide legalization of sports betting in the US.

Endeavor, the parent company of Hollywood’s powerful WME-IMG talent agency, seems to have recognized this and is an early mover in the space. It bought two sports leagues that have relied on TV deals and event attendance revenue – UFC for $4B and the smaller but rapidly growing Professional Bull Riders for $100M – and, since they each own their content, launched direct-to-consumer subscription platforms (UFC Fight Pass and PBR Ridepass) for super-fans and cord-cutters. (Endeavor also paid $250M to acquire Neulion, the technology company whose infrastructure powers the OTT services of the UFC, PBR, World Surf League, and dozens of others.)

There’s opportunity for new streaming platforms focused on being the media partner for these emerging sports leagues. Inevitably, the opportunity for bundling will consolidate many of the niche subscriptions onto a small number of leading sports OTT platforms, and that’s a powerful market position for those platforms.

What is unclear is if they can defend themselves as the incumbent media and tech companies come around to this phenomenon and commit billions toward capturing the market. The leading sports broadcasting companies all have OTT offerings and want to make them as compelling to potential subscribers as possible even if they exclude content from the biggest pro sports. A larger company that can afford to spend huge sums on exclusive sports streaming rights (like Disney with ESPN/ABC, Comcast with NBC/Sky Sports, CBS with CBS Sports Network, or Discovery with Eurosport) might opt to buy a company like FloSports as part of their deep dive into the space or they might just aim to outbid them when a league’s contract comes up for renewal.

The hope for an independent OTT platform devoted to emerging sports leagues is they get big enough, fast enough that they can afford to keep winning the rights to emerging leagues as those leagues grow and offers from competitors bid prices up. These dedicated OTT services will likely have to secure long-term – think ten years – streaming rights deals or acquire control of some popular new sports leagues outright to hold their own.

Like online distribution triggered an explosion of digital publishing brands and social influencers for every imaginable niche, the rise of high-quality live streaming and subscription OTT services will allow a lot more sports leagues to build an audience and revenue base substantial enough to thrive. There’s more variety for consumers and resources than ever for those with a rapidly growing league to attract fans worldwide.

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Old media giants turn to VC for their next act

Posted by | 21st century fox, Activision Blizzard, Axel Springer, bertelsmann, Entertainment, epic games, Gaming, Hearst, Media, Naspers, Netflix, Sky, Tencent, Venture Capital, WndrCo | No Comments

The Web 1.0 and Web 2.0 eras weren’t kind to the world’s largest media conglomerates, throwing their business models into question, creating whole new categories of content consumption, and bringing online competition to subscription and ad pricing. Many of the media giants from the 1990s and early 2000s remain market leaders with multi-billion dollar valuations, however, and have become active investors in startups as a tactic to help themselves evolve.

Of the traditional media companies that have committed to corporate venturing, there are two distinct strategies: those whose investing seems to be about replacing the historic classifieds section of newspapers and diversifying into a range of consumer-facing marketplaces, and those whose investing is concentrated on capturing an early glimpse (and early equity stake) in startups reshaping media.

Replacing Classifieds, Investing in Marketplaces

Mathias Doepfner, CEO of Axel Springer. The company’s startup accelerator is one of the most active in Europe. (Photo by Michele Tantussi/Getty Images)

Given the first crisis newspaper groups faced from tech startups in the 1990s and early 2000s was the rise of online classifieds sites (like Craigslist) and transactional marketplaces (like eBay and Amazon), the disruption of their lucrative classified ads revenue stream drove their attention to e-commerce.

Aside from Hearst, the major US newspaper and magazine chains – like Gannett, News Corp, Meredith Corp / Time Inc, and Digital First Media – haven’t made many investments in startups. Perhaps the financial straits of most US newspaper companies have left little cash for VC investments that won’t pay off for years in the future.

But in Northern and Central Europe, where news readership and even print publishing remain healthy by comparison, the leading media groups have been aggressively investing in marketplace and e-commerce startups across the continent over the last decade.

Europe’s leading publisher, Axel Springer has made itself an established player in the European startup scene. Axel Springer’s Digital Ventures team has backed marketplaces from Caroobi (for cars) to Airbnb, and their Berlin-based accelerator (run in partnership with Plug & Play) has invested in over 100 young startups, like digital bank N26, boat rental marketplace Zizoo, and influencer-brand marketplace blogfoster. In a move more strategic to its business, the 15,000-employee group made a large investment in augmented reality unicorn Magic Leap this past February as well, forming a partnership to leverage its content IP in the process.

Meanwhile, Norway’s Schibsted, Sweden’s Bonnier, and Germany’s Hubert Burda Media (best know to many in tech for their annual DLD conference in Munich) and Holtzbrinck Publishing are each globally active, multi-billion dollar publishers who operate active early- or growth-stage VC portfolios composed mainly of e-commerce brands and marketplaces.

The most iconic corporate venture investment by a newspaper conglomerate (or any company for that matter) is without question the $32M check written into 3-year-old Chinese social web startup Tencent in 2001 by the South African publishing group Naspers (founded in 1915). Tencent, now valued around $400B, is Asia’s largest and most powerful digital media company and Naspers’ 31% stake was worth roughly $175B in March 2018 when it sold $10B in shares.

As a result, Naspers has transformed into a holding company that incubates, acquires, and invests in online marketplace businesses around the globe (though it still maintains a relatively small publishing unit).

The challenge for traditional media companies investing in startups beyond the realm of media is that even if wildly successful, those investments neither give them a distinct advantage in media itself nor make their business model like that of a tech company by way of osmosis. These investments can be flashy distractions to make management and shareholders call the company innovative while it fails to actually re-envision its core operations. Investing in Airbnb or BaubleBar doesn’t address the key challenges or opportunities a traditional publishing group faces.

Therefore the best case scenario in this strategy seems to be that these companies find enough financial success that they just transition out of the content game and become holding companies for other types of consumer-facing brands the way Naspers has. But even then the path seems uncertain: despite all its other activities, Naspers’ market cap is less than the value of its Tencent shares…it’s not clear that the best case scenario necessarily transforms the core organization.

Investing in the Next Generation of Media

Thomas Rabe, CEO of German media group Bertelsmann. Bertelsmann is unique in treating startup investments as a dedicated division of the conglomerate. (TOBIAS SCHWARZ/AFP/Getty Images)

The other track for “old media” giants has been to focus on venture capital as a means to uncover the future of the media business so the old guard can learn from the new generation of media entrepreneurs and react to market changes sooner than competitors. Intriguingly, it is consistent that the conglomerates who have taken this strategy are ones whose operations in television, radio, data, and telecom outweigh any involvement in newspapers.

Bertelsmann, Hearst, and 21st Century Fox have been the most aggressive corporate venture investors in startups working to shape the future of media, whether it be through streaming video services, crowdsourced storytelling platforms, or augmented reality.

With annual revenue over €17B, Bertelsmann is one of the largest media companies in the world, spanning television production and broadcasting (RTL Group), book publishing (Penguin Random House), newspapers, magazine publishing (Grüner + Jahr), and education. Unlike of media companies though, it treats venture investments in media startups as a key division of its company rather than as a side project.

The company’s core Bertelsmann Digital Media Investments (BDMI) invests across the US and Europe in companies like Audible, Mic, The Athletic, and Wondery (and in funds like Greycroft and SV Angel) but there are also the 3 regionally-focused funds investing in China, India, and Brazil plus the education-focused University Ventures fund it anchors in NYC. Collectively, Bertelsmann teams made 40 new startup investments in 2017 and generated €141M in venture returns, according to their 2017 Annual Report.

The investment arm of Hearst, one of America’s largest publishers with $10.8B in 2017 revenue, has likewise been a major backer of BuzzFeed, Pandora, Hootesuite, and Roku not to mention Chinese language app LingoChamp, live entertainment brand Drone Racing League, VR capture startup 8i, and dozens of other media-related startups. Hearst’s ownership in these ventures makes strategic sense: they provide market insights relevant to the core businesses, offer immediate partnership opportunities, and would be strategic acquisition targets that evolve the company’s position in a changing market.

21st Century Fox and Sky Plc (in which 21st Century Fox owns a 39% stake and is trying to acquire outright) have both made a whole slate of startup investments across the media sector in the last few years. In addition to its $100M investment in live-streaming platform Caffeine (announced on September 5) and similarly massive investment in WndrCo’s NewTV venture led by Meg Whitman, Fox has invested repeatedly in sports-centric OTT service fuboTV, hit newsletter brand TheSkimm, VR studio WITHIN, and fantasy sports app Draftkings with Sky often co-investing or building meaningful stakes in international startups like iflix (a leading streaming video service in Southeast Asia and the Middle East).

Since traditional media giants own extensive intellectual property of hit shows, films, and often exclusive rights to popular live events – not to mention established distribution channels to tens or hundreds of millions of people – there are immediate partnerships that can be signed to benefit both a startup and the incumbent. The incumbents often re-invest repeatedly to build their ownership and deepen the alignment between the companies, which rarely happens when media companies invest in marketplace startups.

Tencent’s always-be-evolving model

The new crop of digital media giants that includes Netflix, Snap, VICE, and BuzzFeed aren’t doing much if any strategic investing. Instead they’re keeping focused on growth of their core product offering. The notable exception is China’s Tencent.

In addition to dominating China’s booming messaging app sector with WeChat and QQ, owning 75% market share of music streaming in China, and being the world’s leading games publisher through its own studios (Riot Games, Supercell, etc.) and its minority stakes in Activision Blizzard, Epic Games, and others, Tencent has taken a strategy of investing often and early in promising digital media startups…and it has its tentacles in everything.

Based on Crunchbase data, Tencent has done over 300 investments in startups. It is likely the most active venture investor in China, where most of its portfolio is concentrated, but also backs Western media startups like SoundHound, Wattpad, Spotify, Smule, and Wonder Workshop.

Tencent can give distribution to these upstarts through its vast portfolio of digital properties and it can keep tabs on what new content formats or business models are gaining traction. It operates from a mindset of perpetually evolving, and trying to snatch up startups whose products could be key assets in the future of content creation, distribution, or monetization. This approach is one both old media giants and the next gen of unicorn media startups should consider.

The pace of innovation is moving so fast, and so many new doors are opening up – from subscription streaming and esports to voice interfaces and augmented reality – that corporate venture as a core strategy can unlock opportunities for the organization to evolve early, before it ends up being categorized as “old media”.

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Netflix is falling off a cliff

Posted by | Apps, Comcast, Disney, Mobile, Netflix | No Comments

Netflix didn’t add as many subscribers as expected by a bunch of people on Wall Street who, on a quarterly basis, govern whether or not it’ll be more valuable than Comcast — and that is probably a bad thing, as it’s one of the primary indicators of its future potential for said finance folk.

While it’s still adding subscribers (a lot of them), it fell below the forecasts it set for itself during the second quarter. That’s shaved off more than $10 billion in its market capitalization this afternoon. This comes amid a spending spree by the company, which is looking to create a ton of original content in order to attract a wider audience and lock them into that Netflix ecosystem. That could include shows like GLOWJessica Jones3% or even feature films. But it’s still a tricky situation because it needs to be able to convert shows from that kind of crazy spend schedule into actual subscribers.

Here’s the main chart for its subscription growth.:

So it’s basically down across the board compared to what it set for itself. And here’s the stock chart:

CEOs and executives will normally say they’re focused on delivering long-term value to shareholders, or some variation of that wording, but Netflix is a company that’s been on an absolute tear over the course of the past year. It’s more than doubled in value, overtaking said previously mentioned cable company and signaling that it, too, could be a media consumption empire that will take a decade to unseat like its predecessor. (Though, to be sure, Comcast is going to bundle in Netflix, so this whole situation is kind of weird.)

Of course, all of this is certainly not great for the company. The obvious case is that Netflix has to attract a good amount of talent, and that means offering generous compensation packages — which can include a lot of stock as part of it. But Netflix is also a company that looks to raise a lot of debt to fund the aforementioned spending spree in order to pick up additional subscribers. That’s going to require some assurance that it’ll be a pretty valuable company in the future (and still around, of course), so it may make those negotiations a little more difficult.

Everything else was pretty much in-line, but in the end, it’s that subscriber number that didn’t go as well as planned.

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India’s Times Internet buys popular video app MX Player for $140M to get into streaming

Posted by | Android, Apps, Asia, digital media, funding, Fundings & Exits, india, Media, mx, mx player, Netflix, reliance jio, Satyan Gajwani, smartphone, TC, Times Group, Times Internet, video hosting, world wide web, YouTube | No Comments

Times Internet, the digital arm of Indian media firm Times Group, is getting into the digital content space, but not in the way you might think.

The company’s previous venture — an OTT called BoxTV.com — shut down in 2016 after an underwhelming four-year period. Now it is taking a radically different strategy by buying video playback app MX Player for Rs 1,000 crore, or around $140 million. The company didn’t disclose its stake but said it is a majority percentage.

The service originates from Korea but it has become hugely popular in India as a way to play media files, for example from an SD card, on a mobile device. It is a huge hit India, where the app claims 175 million monthly users — while the country accounts for 350 million of its 500 million downloads.

From here, Times Internet plans to introduce a streaming content service to MX Player users which Karan Bedi, MX Player CEO, expects to go live before August. The plan is to introduce at least 20 original shows and more 50,000 content across multiple local languages in India during the first year. The duo said the lion’s share of that investment money would go into developing content.

Bedi, a long-time media executive who took the job at MX Player eight months ago, said the service will be freemium and very much targeted at the idea of providing an alternative to television in India. He added that the deal had been in negotiation for the past year, which validates a January report from The Ken which first broke news of acquisition.

There are plenty of video streaming services in India. Beyond Netflix and Amazon Prime, Hotstar (from Rupert Murdoch-owned Star India) is making waves alongside Jio TV from Reliance Jio, but data from App Annie suggests MX Player is way out ahead. The analytics firm pegs MX Player at nearly 50 million daily users, as of June, well ahead of Hotstar (14.1 million), JioTV (7.4 million) and others.

Both Bedi and Times Internet MD Satyan Gajwani explained to TechCrunch in an interview that a big focus is differentiation and building a digital channel for India’s young since the average viewer demographics for MX player are hugely different to Indian TV audiences. Some 80 percent of the app’s users are aged under 35 (70 percent is aged under 25), while the gender balance is skewed more towards men.

“A lot of people aren’t happy with Indian TV,” Bedi said. “There are a lot is soaps and it is not focused on young people. [The MX PLayer audience] is exactly the opposite of the Indian tv demographic.”

That not only plays into growing a place for ‘millennial’ content, but it also means the streaming service may find success with advertisers if it can offer a gateway to young Indians. Beyond audience, there’s also flexibility. Gajwani explained further that unlike traditional TV and even YouTube, the Times Internet-MX Player service will offer different options for advertisers who “work with content creators to create stuff, sponsor a show, or find various different ways to reach scale.”

“India has a $6 billion TV ad market and we think this could unlock some of the money going to TV,” he said.

Times Internet MD Satyan Gajwani

“This audience on here is genuinely different, [rather than cord-cuttters] they’re almost cord-nevers,” Bedi added. “This is a big new audience that’s never been tapped by broadcasters.”

The idea is to gently introduce programming that is accessible to a large audience in India, who might not be open to paying, and then test other revenue models later.

“Further down the line, we might include subscriptions to scale,” Gajwani added. “Subscription is growing but it’s much much smaller today, what excites us is the idea we’ll have 100 million people streaming a show.”

MX Player might not be well known, but scale is one thing it certainly has in spades. The company just crossed 500 million downloads on Android, but Bedi pointed out that many are not counted because they are side-loaded, which doesn’t register with the Google Play Store.

All told, he said, the app picks up 1.2 million downloads per day with around 350,000 coming from the official Android app store, he said. Bedi said that, among other things, the app is typically distributed by smartphone vendors in tier-two and three Indian cities to help phone buyers get the essential apps for their device right away.

The question now is whether Times Internet can leverage that organic growth to build another business on top of the basic demand for video playback. This is certainly a unique approach.

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Anker Mars II projector promises solid summer fun

Posted by | Amazon, Android, AV, Bluetooth, bluetooth speaker, chromecast, computing, DLP, Gadgets, HDMI, Netflix, smartphones, TC, wi-fi | No Comments

Anker, a popular if battery and cable company, recently announced the Mars II projector under its Nebula brand. The company, which primarily sells via Amazon, is expanding out of batteries and cables and is now creating audio and other portable AV gear. This compact, battery-powered DLP projector is their latest creation and it has found a place of honor at our family barbecues.

The projector is actually an Android 7.1 device stuffed into a case about as big as a Bluetooth speaker. A physical lens cap slides down and turns on the system and you control everything from he included remote or the buttons on the top of the device. You can also download an app that mimics a mouse and keyboard for choosing videos and information entry. It projects at a maximum of 300 lumens and projects at 720p. You can also connect an HDMI device like a game console or stick in a USB drive full of videos to view on the fly.

Again, the real benefit here is the ability to stream from various apps. I have YouTube, Netflix, Plex, and other apps installed and you can install almost any other Android app you can imagine. It has speakers built in and you can cast to it via Miracast but you cannot insert a Chromecast.

If all you want to do is throw up a little Santa Clarita Diet or Ice Age on a sheet in the back yard, this thing is perfect. Because the brightness is fairly low you need solid twilight or a partially dark room to get a good picture. However, the picture is good enough and it would also make a great presentation device for a closed, dark conference room. Because of its small size and battery life – four hours on a charge – it makes for a great alternative to a full-sized projector or even a standard TV.

At $539 the Mars II is priced on par with other 720p projectors. The primary use case – connecting a computer or console via HDMI – works quite well but streaming user experience is a bit of a mixed bag. Because Anker didn’t modify the Android installation much further than adding a few default apps, some apps require a mouse to use and others can be controlled via the arrow keys on the remote or body of the device. This means that some apps – like Plex, for example – let you pick a video via the arrow keys but require you to press the “mouse” button to begin simulating a mouse cursor on the screen. It’s a bit frustrating, especially in poor lighting conditions.

One of the interesting features is the automatic focus system. Instead of fiddling with a knob or slider, you simply point this at a surface and the system projects a bullseye focus ring until the picture is in focus. The focus changes any time you move the device and sometimes it gets caught up if the screen or projector are moving. However in most cases it works perfectly fine.

Like most portable projectors you aren’t buying the Mars II to watch 4K video in 5.1 surround sound. You buy it to offer an alternative to sitting on the couch and watching a movie. That means this is great for on-the-road business presentations, campouts, outdoor movie viewing, and sleepovers. It is cheap and portable enough to be almost disposable and it’s not as heavy and hot as other, larger devices. In short, it can go anywhere, show anything, and works really well. Anker also makes the Mars, a more expensive 1080p device, but this one works just fine for about $400 less – a big drop in just about a year of brisk sales. It’s nice to see a good, low-cost manufacturer dabble in the world of complex consumer electronics and come up with a product that is truly useful and fun.

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