Netflix Heads South

Netflix may be losing access to Starz content but that isn’t waylaying the company’s plans to forage further afield for potential customers. With North America already sewn up, it’s now moving southwards in an effort to continue its surge onwards and upwards.

It was only the middle of July that Netflix announced this move into Latin America, Mexico, and the Caribbean, but six weeks on and the service is already being rolled out to the 43 countries and territories in that geographic locale.

Brazil is first, with the likes of Argentina, Uruguay, Chile, Columbia, and Mexico gaining access in the coming days. The price in each country differs, but is consistently between $7 and $10. U.S. customers now pay $7.99 for the streaming-only service.

Content Is Key

As Netflix expands internationally, content becomes an issue. It isn’t as though the world is a one size fits all empire whereby everyone watches the same content, so each territory is getting its own specialized set of content partners and genres.

Rochelle King, Netflix VP of User Experience and Design, said in a post on The Netflix Blog:

“Over the last few months, our team has spent countless hours in the region learning as much as we can about how Latin Americans think about, and enjoy, movies and TV shows. We’ve licensed thousands and thousands of hours of feature films, classic favorites, gripping telenovelas, documentaries and kids shows we know you’ll enjoy.”

Content is key, both in the U.S. and beyond. And as Netflix expands it’s going to find it harder to retain the partnerships it has been able to build to this point. Most partners will likely demand a massive amount of cash to keep the deals intact. Perhaps by expanding, Netflix is lessening the risk of being held at gunpoint by increasingly-antsy content providers.

Conclusions

The question now is where Netflix will head next. As a U.K. resident I’m hoping Europe is next on the agenda, as has already been rumored for the beginning of 2012. But Hulu tried and failed to establish a European base of operations and eventually headed to Japan instead. So I won’t hold my breath just yet.

Netflix Loses Starz

The month of September started badly for Netflix, as Starz Entertainment announced it was walking away from negotiations to renew its contract with the former DVD-by-mail company which sees its future wholly in streaming content to customers via the Internet.

The two companies were discussing a new deal to replace the current one which ends in February 2012. But in order to “protect the premium nature” of its brand Starz has decided to walk away from any potential deal and take its football (in this case a back catalog of movies) with it.

That can only mean one thing got in the way of a deal being forged: money. Which, as we know, makes the world go round. But it’s not as if Netflix wasn’t willing to pay Starz a hefty wedge of cash for its content.

Starz Loses Its Head

According to The L.A. Times, Netflix offered Starz a whopping $300 million-per-year to renew the existing contract. That is more than 10-times the amount the company has been paying since the deal was first struck in 2008.

Two things which have happened in that time are important to note: Netflix has grown in popularity, gaining subscribers every quarter; and it has added more and more content in that time. The former made Starz demand more money, the latter gave Netflix the confidence not to cave to its demands.

Netflix CEO Reed Hastings has stated that Starz represents around 8 percent of content viewed at the present time, and will likely hit around 5 percent by the time the deal concludes. Which means other content the company is currently pursuing will be able to fill the void left when Starz moves on.

Everyone Loses

The sad thing is that everybody loses here. Netflix loses a content partner, Starz loses a potential $300 million of annual revenue, and Netflix subscribers lose the opportunity to watch that content quickly and easily. And all because of greed.

[Via PR Newswire]

Socialcam Startup

In the spring of 2011 Justin.tv launched a mobile sharing app that was designed to do for video what Instagram has done for photos. That being allowing smartphone users to share them with others across a range of platforms, social networks, and websites easily.

In the six months since the app made its debut it has become a major player in the market alongside the likes of BlipSnip, Viddy, and Vlix. So much so that Socialcam is being spun off from Justin.tv to be its own, independent entity housed in Founders Den in San Francisco.

Justin.tv co-founder and current CEO will be going with it and taking a small band of select engineers with him. Justin.tv will retain a stake in the new company, with additional funding and backers now being actively sought.

Ch-ch-ch-ch-Changes

Seibel is being replaced as CEO of Justin.tv by CTO Emmet Shear, who is charged with pushing TwitchTV (a live streaming video games portal launched in June) onto even greater things than it has already achieved.

I can only imagine TwitchTV will eventually be spun off into its own company as well. After all, 8 million viewers watching 1 billion minutes of video every month would suggest there’s a future for this endeavor. Which leaves me to question whether the original Justin.tv is being hung out to dry?

So What About Justin.tv?

Justin.tv is one of a number of live streaming video companies which offer people the chance to effectively broadcast online as if they owned their own TV station. But it’s a market that seems to have reached a certain point and remained there, slowly flatlining.

While it’s still a popular destination, there is clearly some effort by the Justin.tv execs to move into other territories rather than risk losing momentum to the point at which they do a Joost. Because no one wants that kind of memorial.

[Via TechCrunch]

Amazon Bidding For Hulu?

Hulu is up for sale, although most people don’t understand why its owners, Walt Disney, News Corp, NBC Universal, and Providence Equity Partners, want to sell what has so far been a successful venture and one that stands on the cusp of greatness as the online video sector grows ever larger.

Some companies, such as Microsoft, have fallen out of the running, but the likes of Google, Yahoo, and DirecTV are still in. Also rumored are Apple and a new contender in the form of online retailer Amazon.

Amazon stands to gain a lot from acquiring Hulu. It would add content to its Prime subscription service and be a great selling feature were the company to release an Android tablet designed to compete with the Apple iPad in the near future. Which is pretty much guaranteed at this point.

Whoever grabs Hulu looks set to pay somewhere in the region of $1 billion to $2 billion. Which is a huge sum of money, granted, but still doesn’t justify the sale in the first place. And it isn’t just laymen such as myself who think so.

Why Sell???

BTIG analyst Richard Greenfield has argued the case for its current owners to hold on to Hulu and questioned why they are even considering selling at such an early stage. In a recent blog post [via The Hollywood Reporter] he argues:

“We find it very hard to fathom why any media company would want to give up ownership of such a unique asset at such an early stage of growth. Hulu appears to be the perfect weapon for networks/content creators to embrace so they can grow revenues and profits, even if the current multichannel ecosystem becomes unglued over the next decade.”

“Media companies should be going out of their way to retain ownership of Hulu and allow it to flourish. The bigger Hulu gets, the more dollars it can pay content creators on an annual basis. While that may be true if it is owned by a third-party as well, being invested in Hulu and sacrificing near-term profits for long-term value creation appears far too compelling.”

It does appear as though the current owners are seeking short-term gains while completely missing the opportunity Hulu offers them in the long-term.

News Corp. has actually indicated it may retain its stake in the company, but the others all seem to want to get out while the going is good. Which makes no sense whatsoever for a growing entity such as Hulu.

Conclusions

I’ve struggled to understand why the current owners of Hulu would want to sell at this stage, but they seem intent on doing so for whatever fatuous reason. Their loss is going to someone else’s gain, and I wouldn’t bet against Amazon emerging victorious in this colossal auction.

Content ID System

YouTube was absolutely awash with pirated movies and TV shows at one point, very early in its life. This is the reason various companies, most-notably Viacom, sued YouTube for a fortune. But Google voraciously cleaned YouTube up, and most media companies are now on board.

The Content ID system, which automatically detects the presence of copyrighted content when its digital fingerprint is provided, has helped immensely. But it’s not perfect, and some piracy is still occurring on the world’s most-popular online video destination.

Pirated Movies On YouTube

It has been claimed that at least 25 movies, including recent releases such as Cars 2 and Fast 5, were available to watch on YouTube in their entirety until the end of last week. Now, probably not, as the issue has been brought to YouTube’s attention and the site is no doubt doing all it can to rectify the situation.

How long these videos had been up is anyone’s guess, but 500,000 views for some suggests more than just a few hours. These weren’t great copies, however, instead having been recorded from a DVD or cammed from within a cinema. Which would indicate an amateur effort to say the least.

Still, with software enabling people to download videos from YouTube, this could have helped hundreds of thousands of individuals to avoid paying to see a film.

Conclusions

I’m not convinced this is a new issue, as has been suggested. Instead, I suspect this has been happening since YouTube disabled the video length upload limits for trusted users. From that point on any one of these people could upload a pirated movie to YouTube, as long as they were willing to risk being banned from the site.

Still, regardless of how long this has been happening, the fact remains that it has shown up some issues with Google’s Content ID system. It clearly isn’t a foolproof way of ensuring copyrighted material doesn’t make its way onto the site.

[Via PC Magazine]

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Google+ Hangouts

Google+ is the search giant’s latest foray into the world of social networking. And it’s already doing a lot better than their other attempts to enter the territory currently dominated by Facebook and Twitter.

One of the core features of Google+, and the reason Facebook fought hard for Skype integration itself, is Hangouts. This is group video chat with up to 10 people able to share a video chat together about anything and everything. Or more likely, nothing whatsoever.

Google+ Hangouts has had some YouTube integration from the beginning, but it has just been improved a great deal.

YouTube Video Integration

Now, as well as being able to launch videos within a chat and launch a live stream within a chat too, YouTube videos on the site are labeled with a Google+ Hangout button. This appears under the Share option, alongside Facebook, Twitter, Embed, and Email.

This may not seem like much but it could get people using Google+ in a big way. And many social networks suffer from a lack of maintained interest, with boredom quickly setting in if new features and activities aren’t provided on a regular basis. This could help prevent that from happening on Google+.

The big question for me is if social video viewing is something most people want to do?

Conclusions

I watch a lot of YouTube videos, partly for work, partly for entertainment. I also share the best one with friends and family occasionally. But do I want to sit and watch them with a group of people in a video chat, most of whom I barely know? The answer is a categorical no. I could, however, be in the minority.

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Amazon Instant Video Library

Amazon has recently penned deals with CBS and NBC which has helped push its digital video content beyond the 100,000 titles milestone for the first time. Unfortunately most of these titles are limited to Amazon Instant Video rather than Amazon Prime.

TechCrunch suggested this meant Netflix needed to Watch Out!, but at the moment Netflix is perfectly fine, thank you very much. The future may well see this situation change, however, which is likely why Netflix is expanding internationally and shoring up its U.S. business before Amazon has a chance to “flip the switch.”

Comparing Apples and Oranges

Some people seem to have got it into their heads, directly on the back of this announcement, that Amazon Instant Video is now beginning to rival Netflix, and that the latter should be looking over its shoulder for the competition about the stick a knife in between its shoulder blades. But this is nonsense.

Amazon Instant Video is an à la carte service whereby customers purchase individual titles for streaming. Which is more in line with what Apple offers on iTunes. Netflix, on the other hand, offers an all-you-can-eat service called Watch Instantly for a set monthly subscription. So we’re comparing apples and oranges here.

Amazon does have a similar service, Amazon Prime, which costs $79-a-year and includes other benefits. But there are only around 9,000 titles included in the Amazon Prime video library, which compares unfavorably to the tens of thousands Netflix offers.

Conclusions

Amazon can rightly be proud of the range of video content it now offers its customers. Amazon Instant Video is good competition to the behemoth that is Apple iTunes. But it’s no Netflix, and isn’t even trying to be.

However, were Amazon or Apple to decide they did want to beat Netflix by offering a cheaper all-you-can-eat service then they may be able to do so. After all, they now have the content in place and the lines of communication with those who own the content open.

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Netflix’ Streaming Future

Netflix has made it clear that its future is one where streaming reigns supreme. DVDs are dead, folks, so get over it. Delivering movies and television shows over the Web to a range of devices is faster, cheaper, and more compatible with a rapid international expansion.

If the company is heading down this route, and it most certainly is, then it has to make its ‘Watch Instantly’ service the best it can possibly be. And that means catering to every group of people and every member of the family. Including the youngest members. After all, the children are our future, as someone once sang.

Children are often as geeky or even more geeky than their parents these days. After all, they’ve grown up in the Internet age, afforded the luxury of instant information other generations could only dream of. So Netflix would do well to look after them…

‘Just For Kids’ UI

That is exactly what the company has now done, debuting ‘Just For Kids’. This is a section made specially for children, with all the content they will love and that parents will be happy to let them watch collated into one category.

Rather than being organized by title, the content is organized by characters, as that is how kids recognize the shows they love and watch over and over again.

‘Just For Kids’ is friendly for all kids aged 12 and under, and it is going to be rolled out on all Netflix connected devices over time. For now it is only available on PC and Mac in the U.S. and Canada.

Conclusions

There are some commenters on the blog post suggesting that rather than making a separate section for kids that Netflix just improves the parental controls so that it’s less convoluted to restrict and release content on a regular basis.

That is clearly an issue that needs looking at, but ‘Just For Kids’ is a good start, introducing the youngest members of the family to the joy of online video at an early age.

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Movieclips

I first covered Movieclips almost two years ago when it first launched in the U.S. with a healthy 12,000 clips. There were a few issues, such as a clunky user interface and slow loading-times, but ultimately the site showed a lot of promise.

Much has happened since then. First off, the number of clips has risen to 20,000. The site has also been improved beyond reproach and the ways and means of searching for the clip you want to see via the added meta-data have been expanded.

Unfortunately Disney is still not on board, which means Movieclips is still missing content from one of the major studios. Still, six out of seven isn’t bad. There’s also the little matter of a new round of funding worth $7 million and some even bigger news…

Movieclips On YouTube

Movieclips has landed a partnership deal with YouTube which brings its content to the Google-owned site. The hope is to provide for movies what Vevo does for music videos and Machinima does for gaming videos.

Movieclips now has an official page on YouTube and also features on the site’s Movies page. The clips are seen as an enticement to people to rent full films. Kind of like a try before you buy deal.

Movieclips has plans to expand from this point forward, both in terms of the number of clips available, and the range of content. We’re talking trailers, interviews with movie stars, and behind-the-scenes footage being added for good measure.

Conclusions

This deal is good for all parties. Movieclips gets exposure most companies would kill for, YouTube gets a premium new content-provider, and the movie studios get to control the clips being uploaded on the Web. And all three make money from sharing the revenue from adverts.

Oh, and we, as movie lovers, get to see high quality clips of the most memorable scenes from our favorite films for free. What’s not to love?

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Original Web Programming

There is an intriguing trend emerging whereby Internet companies are no longer merely buying up content that has already aired on television but also producing and/or financing their own original programming to air exclusively on one service.

In March Netflix announced it had won the bid (against the likes of HBO and AMC) for House of Cards, a new drama serial starring Kevin Spacey and directed by David Fincher. And now Hulu has joined the ranks, although its series isn’t either as highbrow or expensive to make as House of Cards.

A Day In The Life

Hulu is producing a new six-part series called A Day In The Life, which will see documentary filmmaker Morgan Spurlock (Super Size Me, 30 Days) spending 24 hours with various “fascinating people.”

The first episode features Virgin boss and billionaire Richard Branson, with future episodes seeing appearances by Will.i.am, Russell Peters, and Girl Talk (no, me neither). The series begins on Aug 17.

Spurlock said:

“As a filmmaker, I am always looking for new and exciting ways to reach an audience and to tell stories. When the opportunity to create an original doc series with Hulu presented itself, I jumped at the chance.”

The company has suggested this won’t be a one-off, with Charlotte Koh of the original content development team stating this is part of a “new Hulu initiative designed to support creatively and financially the work of independent storytellers like Spurlock.”

Hulu is currently up for sale, of course, so it seems a little strange that it has chosen now to get into the original production game.

Conclusions

Morgan Spurlock definitely has an audience and one which is likely to be switched-on enough to use Hulu. So it would seem to be a no-brainer for the company to fund his work and get original programming as compensation.

Could this be the start of a huge trend? One which will see the power of the traditional networks and studios somewhat dampened?

[Via AFP]