What’s Charlie Ergen’s strategy this week?
Satellite TV billionaire Charlie Ergen isn’t a regular on Dish Network’s analyst conference calls these days especially
since he stepped down in May as chief executive (which he still chairs). But when he makes an appearance, nearly as rare these days as one of those biennial dividends it pays, it’s worth a listen.
After losing more subscribers than expected in the third quarter Dish executives pointed to larger rival DirecTV’s hugely successful NFL football Sunday Ticket giveaway as the primary source of competition.
Ergen’s surprise appearance on the call allowed analysts to pivot away from the dreary operational numbers and discuss his vision of the pay-TV space. In May he had described Dish’s hodge podge of investments in wireless broadband and content as the “Seinfeld Strategy”. In other words, it’ll all make sense in the end. We hope for investors’ sake that’s right.
Ergen’s view on competition:
- I think from a macro point of view, clearly DirecTV’s results showed there’s still a big business out there for satellite television on a standalone basis and the rest of the industry absent the phone companies really was negative, so I think there’s still business out there. Satellite is still the most efficient way to deliver video. We’re just not getting our fair share of it yet, but having said that, the other macro trend is we’re continuing to use more consumers are consuming more bits and bites of zeros and wants, could be data, video, it could be voice, so I think that strategically, we believe we have to be in something other than a standalone video business as a Company and we’re in the transition of being able to do that.
That’s going to take some time and it’s unclear whether that’s going to be a smart business decision or not but we think that the way that the zeros and ones come together are going to be beyond just video and you’re going to need to be beyond fixed video to the home, so that’s a path that we’re on strategically and we think that’s going to pay dividends for us long term.
Ergen’s views on rising programming costs:
Tech wrap: Blockbuster 2.0 – now streaming movies
There’s a new video streaming service on the block and it comes courtesy of an old, familiar name – Blockbuster. Blockbuster unveiled the video streaming service to subscribers of satellite provider Dish Network, which now owns Blockbuster, in a move to better compete against video rental giant Netflix and to lure customers from rival cable and satellite TV providers. Non-Dish subscribers will have to wait until Blockbuster launches a broader online streaming plan later this year, the company’s president told Reuters.
Called Blockbuster Movie Pass, the subscription service will start at $10 a month and includes DVD rentals by mail and at the company’s more than 1,500 stores. The service will offer up a selection of more than 3,000 movies streamed to televisions and 4,000 movies streamed to computers. The mail and store rentals include video games. Mail plus streaming with Netflix starts at about $16 a month. Will Blockbuster’s service be enough to threaten Netflix? Not a chance, argues CNET’s Roger Cheng. “Essentially, it’s a souped up Dish package,” writes Cheng. ” We were looking for something radically different from Dish, but we got an incremental new service plan instead.”
Amazon’s long-awaited tablet could be on its way soon. At least that’s the speculation that began floating around tech circles on Friday after the company announced plans to hold a press conference next Wednesday. Amazon declined to provide further details, but analysts were confident that the world’s largest Internet retailer will introduce its long-awaited tablet computer this year to expand in mobile commerce and sell more digital goods and services.
In other Amazon news, the company won another round in the patent fight over its “one-click” purchasing system as an appeals court ruled on Friday that it did not infringe technology patented by Cordance Corp. Separately, a peace treaty between California’s government and Amazon became official on Friday with Governor Jerry Brown’s signature on legislation striking a compromise between the two sides on taxing online sales.
Groupon’s chief operating officer is leaving to join Google five months after joining the company, and ahead of a highly-anticipated initial public offering. Groupon said on its official blog on Friday that Margo Georgiadis was leaving the daily deals company to take a job as President of Google’s Americas business.
Brace yourselves: (former?) video titan takes aim at Netflix
By Lisa Richwine
It’s getting crowded in Netflix-land.
The field of players battling for customers in the fast-growing online video market may soon get another big-name entrant: Blockbuster, reinventing itself under new owners Dish after a disastrous run, looks ready to launch its long-awaited move into instant video streaming next week, another shot at grabbing customers frustrated with Netflix.
Blockbuster, a unit of Dish Networks, set a press conference for next Friday in San Francisco coyly named “A Stream Come True,” where it promises to unveil “the most comprehensive home entertainment package ever.”
CEO Joe Clayton and Blockbuster President Michael Kelly will appear at the event.
Blockbuster has already tried to lure Netflix customers — upset by a recent price increase — to its subscription rental service, which currently offers DVDs by mail and in stores.
Adding streaming could better position Blockbuster to pull customers away from Netflix, the popular movie and television show rental service that helped push Blockbuster from a dominant chain of video stores into bankruptcy.
another opinion piece with the same recycled info. Yawn. Netflix is still the only good streaming service and is by far the best value.
Tech wrap: Google impresses investors
Google shares soared in after-hours trade as the company’s second-quarter revenue zoomed past Wall Street expectations. The Internet giant’s net revenue, which excludes fees paid to partner websites, jumped 36 percent to $6.92 billion in the second quarter. That’s not all investors had to cheer, though. Growth in a range of businesses from mobile to online video helped the company ring up a strong quarterly profit that also exceeded investor expectations. “Google should be viewed as a growth company again this quarter,” Stifel Nicolaus analyst Jordan Rohan told Reuters. “The combination of mobile search, Android, ad exchange, YouTube, and the core search businesses, they’re all doing well. Google is no longer a one-trick pony.”
The pool of underwriters working on Groupon’s upcoming initial public offering just got a lot bigger. The online daily deals website has added 11 new underwriters, including JPMorgan, Allen & Co, Bank of America Merrill Lynch, Barclays Capital, Citigroup, Deutsche Bank Securities, William Blair & Co, Citadel Securities, Loop Capital Markets, RBC Capital Markets and the Williams Capital Group, according to an updated regulatory filing. They join Morgan Stanley, Goldman Sachs and Credit Suisse, who were the lead underwriters named in the earlier filing.
Blockbuster unveiled a new promotion on Thursday aimed at scooping up Netflix subscribers who are unhappy about new price increases the company announced this week to its streaming-and-DVD plan. Blockbuster, which is owned by Dish Network, offered Netflix customers who switched to one of Blockbuster’s “total access” plans a 30-day free trial. Netflix has tried to deflect the rage from its subscribers. “We knew there would be some people who would be upset,” a company spokesman told the International Business Times recently. “To most people, it’s a latte or two.”
Is Research in Motion working on a Web TV device? Boy Genius Report picks up on a post over at BlackBerry fan site NerdBerry.net that claims the company will launch the media player this fall. Codenamed “BlackBerry Cyclone”, the device is rumored to be similar to Apple’s TV box and will enable users to stream media from sites such as Neflix and YouTube directly to their television.
Tech wrap: YouTube changing the channel?
YouTube is working on a major site overhaul to organize its content around “channels” as it positions itself for the rise of Internet-connected TVs that allow people to watch online video in their living rooms, writes the WSJ’s Jessica Vascellaro and Amir Efrati. Changes to the homepage will highlight sets of channels around topics such as arts and sports and approximately 20 “premium channels” will feature 5 to 10 hours of professionally-produced original programming a week, according to a Vascellaro/Efrati source.
Dish Network won Blockbuster in a bankruptcy auction for $320 million, further broadening its business beyond satellite TV and setting up a possible showdown with Netflix. The deal covers “substantially all” of the rental chain’s business, and likely gives Dish the rights Blockbuster had to stream movies over the Internet, the Blockbuster brand name and customer lists.
A Deutsche Bank estimate that 100,000 Motorola XOOM units were sold over its first two months means the tablet was a flop, writes Business Insider’s Jay Yarow. For comparison, Apple sold 300,000 iPads on the first week weekend it was available. BetaNews’s Joe Wilcox calls the XOOM a surprising success, noting that the tablet came to market with “huge handicaps, all of which make comparisons to iPad 2 unrealistic”. Wilcox says higher pricing has been the main deterrent to buying a XOOM.
Google removed the streaming music app Grooveshark from the Android Market, over concerns it was facilitating music piracy, writes The Next Web’s Matt Brian. Unlike services Spotify and Rhapsody, music is added to Grooveshark by users.
Microsoft and Toyota unveiled a plan to work together on bringing Internet-connected services to Toyota’s cars. Toyota is planning to set up a network based on Microsoft’s Azure “cloud computing” platform by 2015, which would allow customers across the world access to Toyota’s digital services.
Analog chips are back in fashion after Texas Instruments hatched a $6.5 billion deal to buy National Semiconductor Corp as it looks to cement its place in the mobile computing explosion, writes Noel Randewich. Analog chips — which manage power, among other things, in everything from tablets to refrigerators — look set to gain a new investor following as the industry’s growth prospects are reassessed.
With Content at the epicenter and Google TV experience of backlash from major studios – Google will built resouces in addition to negotiation with content owners and studios to counter the content challenge.
Western Digital enters crowded digital living room with new device
This holiday season, technology companies are singing a familiar refrain: “Everybody gather around the TV.” With Apple Inc and Google Inc already rolling out their devices to plug into the home television, the connected living room just got more crowded, as hard drive maker Western Digital Corp has updated its television media player just in time to compete with the likes of Apple TV and Google TV for the almighty holiday shopping dollar.
Western Digital’s latest offering, the WD TV Live Hub at a price point of $199, is an update to the Lake Forest, California-based company’s last media player. A key difference is this one comes with a 1 terabyte hard drive built-in, while the previous version had to be connected to an external hard drive for stored movies, music and photos. Western Digital also upgraded the interface on the device and gave it a wireless keyboard made it compatible with wireless keyboards, which users can wield from the couch. Like the previous version of WD TV, this device has Internet connectivity. It can stream movies from Netflix, download films from Blockbuster, access a user’s Facebook page and more.
While Apple TV is priced lower at $99, that device is mostly geared toward streaming rented TV shows and movies over the Web, whereas Western Digital is taking a bet that users will want to download movies and TV shows, not just stream them. Hence that 1 terabyte of storage.
“While the whole industry is zagging toward streaming, we still think the hard drive has a place,” said Dale Pistilli, vice president of marketing for Western Digital, at an event at a studio loft in Hollywood, California, to unveil the device on Tuesday night.
On another front, while Google TV is geared toward making almost the entire Web search-able and playable on a user’s TV, WD TV Live Hub does not go that far — even though it does come with a keyboard. That search function makes U.S. broadcasters nervous out of a fear that users will migrate toward Web content and away from the shows that make up the meat and potatoes of the usual cable TV diet. Three of the biggest broadcasters have blocked their shows from Google TV. Western Digital is not seeking to rattle the cages of Hollywood with its WD TV Live Hub, and with its ability to store large amounts of downloaded movies (up to 120 hours of high definition video and 1,500 hours of video in standard definition) that users would pay for, the device is arguably more friendly to Hollywood than Google TV.
From a price perspective, WD TV Live Hub is cheaper than Google TV. Sony Corp this month unveiled a line of Google-enhanced sets that cost between $600 and $1,400. Sony also unveiled a Google-enabled set-top box that costs $400.
Wired magazine took a lukewarm view of Western Digital’s last offering, the WD TV Live Plus, faulting it in a review for having a “chunky remote that recalls the sophistication of your finer motel television set clicker” and adding that “video quality was hit-and-miss” for movies streamed over the Web.
Wow! My Blockbuster is closed
The fate of the Blockbuster movie rental chain really hit home this weekend when I saw a “for rent” sign on what was once a busy location. That particular shop — on a high-traffic Westchester, NY strip, across the street from a always-busy mall — was once a bustling spot, particularly on weekends. The economy is rough, of course, but I would have bet it would outlive its smaller neighbors.
Nope. The mom-and-pop pet supply store a few doors down, which is spitting distance from a mega-PetSmart and PetGoods? Still open. The baseball card memorabilia/comic book shop? Open AND buying stuff.
Sure, Blockbuster, which is facing tough competition from Netflix and Redbox, has said it planned to close up to 1,560 stores by the end of this year. And I — a Netflix member and cable on-demand user — can’t remember the last time I was actually in that store. Maybe its my fault.
Nah. Even the the movie studies and cable companies want to eat Blockbusters lunch. And these are no shortage of Blockbuster gripe stories (http://www.ihateblockbuster.com/).
But I’ll tell you one thing, it will be interesting to see if Blockbuster CEO Jim Keyes can turn aroung the death spiral talk surrounding the company. He’s laid out some interesting and optimistic ideas and plans for the stores. His vision is for stores that serve as a content hub. The problem is the number of folks who still see Blockbuster as it is portrayed in this 1990′s ad:
Perhaps Keyes he can work magic on those stores. That is, the ones that are still open.
Blockbuster gets kicked when it’s down by cable companies
It’s a tough time to be a video rental store owner wherever you are, but it’s especially tough if you’re Blockbuster Inc and have 6,500 stores to manage, thousands of employees, expensive debt repayments and a sinking share price.
Yesterday Blockbuster warned for the first time that it may need to file for bankruptcy protection and its auditors at Pricewaterhouse raised doubts about its ability to continue as a going concern.
It doesn’t get any worse than that right? No, it does.
According to a story we spotted today from Hollywood Reporter, movie studios and cable companies are joining forces for a $30 million advertising campaign over the coming months to promote awareness of movies available on cable’s video on demand services.
From Hollywood Reporter:
The Movies on Demand initiative comes as on-demand film rentals have hit new highs as viewing habits are changing, and studios are increasingly looking to capitalize on their high margins amid a more mature DVD market.
The TV, print and online ad campaign runs under the theme “The Video Store Just Moved In” and highlights how easy it is for digital cable subscribers to view movies at home with a simple click of their remote. It also includes a dedicated website at CableVideoStore.com and a Movies on Demand logo.
I worked for a locally owned video rental store (6 locations) in 2008. It’s numbers each month were hand over fist higher than 2007. I still stop in occasionally, and my former manager assures me that buisness is still going up.
Perhaps it’s just blockbuster that sucks?
from Summit Notebook:
Redbox: Paving the way for “G.I. Joe” rentals
You thought that maybe that giant Redbox machine in your local food mart, offering $1 DVDs, was simply a low-cost way to share a movie night with the family.
Its REALLY a (nearly) free pass for guys to grab testosterone-rich, leave-your-brain-at-the-door, man-cinema, where stuff blows up reaaal gooood.
You know: "Predator" or "Conan the Destroyer." Or something else starring Govenor Arnold. Redbox President Mitch Lowe said the low price allows people to explore their taste universe...
"What is misunderstood is that that dollar price point gets you to watch movies and rent movies that you never would have thought of renting before."
... and reap the fringe benefit...
"I've seen examples of wives approving renting, I think, "G.I. Joe: The Rise of Cobra" just because it's just a buck, where as if it was Blockbuster, they would say "you are not going to spend three dollars on that movie I'm never going to watch."
The flip side: Don't be surprised, guys, if you develop an (ahem) "urge" to sample Jane Austen's " "Sense and Sensibility" or the "Sisterhood of the Travelling Pants."
Netflix CEO Reed Hastings on Xbox, Youtube, iPhone
We caught up with Netflix CEO Reed Hastings at the movie rental company’s event where it awarded a $1 million prize after a contest aimed at improving the accuracy of movie recommendations. He spoke about his hopes of working with Apple on the iPhone, the possibility that YouTube will beef up its movie service, and the future of the DVD.
Reuters: What will Netflix subscribers gain from the improvements in the recommendation system?
Hastings: It’s doubling the quality of our movie recommendation and that helps our subscribers get more enjoyment from movies. Because more often they love the movie they watch. More often the movies recommended will will turn out to be movies that you love. If you watch a couple of movies and don’t like many, you start to watch (sports and other programming). If every movie is incredible, you start to watch more.
Reuters: Netflix video streams on Microsoft’s Xbox Live system. What about the PS3 and Wii? Hastings: Eventually we want to be on all the game consoles, all the Blu-ray players, all the Internet TVs. So we are working in parallel with all of those efforts. Currently our Xbox deal is exclusive and we haven’t characterized it more than that.
Reuters: Any plans to work in partnership with Apple and the iPhone? Hastings: it’s something that’s likely to come over time. But nothing in the short term. (With) movie watching, we are not focused on mobile yet, but (instead) on the TV, on Blu-ray and on the video game consoles. We will get to mobile eventually, including the iPhone.
Reuters: What of Youtube’s potential movie service? Hastings: I think there will be a lot of competition in this market: Hulu, Apple, Amazon, Youtube, Blockbuster. Internet video is a huge opportunity. And there will be a lot of people engaged, and that is going to be great for the consumer. All of us are going to innovate and compete with each other and provide more and more value to the consumer.
Putting Netflix on a Wii is a great idea, it’s the best selling console in the nation and it’s very family centered and oriented. Obviously going from playing Wii Fit to watching a movie on the same family console is a great marketing strategy. Nintendo even does promotional stuff, like this online one I’ve found for a FREE Wii. Check out the link for more info on how to get it.
http://www.gamesncs.com/rd_p?p=192108&t= 9528&a=13190-wii&gift=3679
