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Netflix's streaming content license fees are projected to increase at least $500 million this year from $180 million in 2010 - more than wiping out much-ballyhooed savings from reduced disc postage and distribution costs, an analyst said. Michael Pachter, with Wedbush Securities in Los Angeles, said the exponential rise in Netflix's license fees revolve around recent benchmark content deals completed with pay-TV channel Epix and The Walt Disney Co. He estimates Netflix will pay Epix $190 million annually during five years for repurposed movies from Epix co-owners MGM, Lionsgate and Paramount - available 90 days after initial broadcast. Pachter expects Netflix to shell out $150 million to $200 million annually for a renewed deal with Starz Entertainment - with the current $30 million per year agreement set to expire in this fall. The analyst believes Netflix will pay on average more than $107 million per year per studio for repurposed movies from Walt Disney Studios Home Entertainment, 20th Century Fox Home Entertainment, Universal Studios Home Entertainment, Warner Home Video and Sony Pictures Home Entertainment. He says Netflix will pay even more for TV content, with separate studio deals ranging from $100 million to $200 million per year. Pachter says Netflix will realize about $200 million in reduced postal fees after 2012.
Philips is moving its loss-making TV business to a 30/70 joint venture with Hong-Kong based monitor maker TPV and has the option to sell out. The Dutch group has struggled to compete against players like Samsung and LG Electronics. Van Houten, a restructuring expert who took over as CEO this month, said on Monday he is assessing the profitability of Philips' 400 or so business areas, a hint that further divestments could be on the cards. "We are not yet firing on all cylinders...There's much unlocked potential in Philips," Van Houten told Reuters Insider. Philips' shares opened lower on the news, but then recovered to trade up 0.9 percent at 10:29 a.m.. Philips has 3,600 employees at the business, all of whom will be transferred to TPV. It did not give a value for the deal, saying it would receive a deferred payment from TPV. Philips showed its first television to the Dutch public in 1928 -- a bulky box-like contraption that was a far cry from its current sleek, flatscreen models. But Philips, once a global leader in TVs, can no longer compete with lower-cost rivals. The unit, which makes up less than 10 percent of group sales, has become a thorn in the firm's side, having notched up losses of almost a billion euros since the beginning of 2007. Van Houten said the joint venture "will enable a return to profitability for the television business, and an increased portfolio focus for Philips in health and well-being."
Wal-Mart Stores Inc. (WMT), the world's biggest retailer, plans to cut back on space for electronics as sales in that category have declined, contributing to the company's two-year U.S. sales slump. The company, which is based in Bentonville, Arkansas, will reduce the floor space devoted to items like flat-screen televisions and give some of that space to apparel, according to Rosalind Brewer, who runs the Wal-Mart East division. Brewer spoke at a retail conference in Atlanta today. The reduction is a reversal of Wal-Mart's 2009 move to allocate 21 percent more floor space to entertainment gadgets and comes after electronics contributed to a 1.8 percent decline in sales at U.S. stores open at least a year in the fourth quarter, its seventh consecutive drop. "It's something Wal-Mart has needed to do for a year," said Craig Johnson, president of Customer Growth Partners, a New Canaan, Connecticut-based consulting firm, in an interview. "You don't need as much space in that area with products shrinking and purchases going online, and electronics has narrow profit margins. Floor space is a scarce commodity."
To perform the test, all you need is one piece of string that measures about the length of your arm. Tie a knot in the middle, and then a knot two to four inches from each end. Hold the string up to your nose with the closest knot about two inches away from your nose. Make sure your finger isn't obscuring your line of sight. Now you're ready to go. First, check to see how many knots you see as you look at the knot in the center. You should see only one. If you see two, you may have double vision, or diplopia, and should consult your optometrist. Next, check to see how many strings you see as you focus on the center knot. You should see two, crossing at the knot in the middle. If you don't see two strings, you don't see 3-D. I found that the strings kept popping in and out, so I definitely have issues with 3-D perception. If you see two strings, the next step is to determine where the strings cross. If they cross at the center knot, your eyes probably work well together and you can see 3-D. If they cross in front of the center knot, your eyes are pointing in too much and you have "convergence excess." And if the strings cross in back of the center knot, your eyes aren't pointing in enough and you have "convergence insufficiency."
As broadcasters and television networks try to figure out their Internet strategy, the TV content that actually is online is generating quite a pretty penny. Online TV brought in $1.6 billion last year, up 34% from 2009, according to a data analysis by IHS. The largest contributor to that growth was a 65% rise in Internet TV advertising, which reached $719 million in 2010. That's surprising, since Big Media has often beenreluctant to throw its content online, thinking it would jeopardize their lucrative deals with cable providers. And the number of online television streams with ads rose by a measly 10% last year. But some analysts say that the big players in online TV are actually making out pretty well. "Even in this conflicted market, revenue was up, thanks to the proactive attitude of a handful of players, including Hulu and the CW Television Network, which have managed to expand revenue even as consumption growth has leveled out," said Dan Cryan, head broadband media analyst at IHS.
YouTube has started its new service "YouTube Live" to offer live streaming videos of concerts, sports and interviews to users. Consumers can use the new service, launched online at youtube.com/live, to watch shows or events streamed by the Google-owned operation's partners, who will be able to access the YouTube Live streaming platform to begin broadcasting content. The launch started with a "Digitour" performance by YouTube musicians. It is not the first time the online video company is showing live videos. The new Live platform would make live-streaming a standard practice. The company said that the new service is intended to be a platform for its partners to show live content to users. YouTube product manager Joshua Siegel and product marketing manager Christopher Hamilton said in a blog, "The goal is to provide thousands of partners with the capability to live stream from their channels in the months ahead."
Hulu is doing well if you ask Jason Kilar, the CEO, who reported the Q1 stats for the online video service in a blog post on Monday. From the sounds of the post everything is unicorns and cotton candy over there in the rose-colored world of Huludise. Lots of good stats to show how healthy the company is and illustrate the jump up from the $263M they did last year which could spell I…P…O… Kilar stated the company is, "on pace to approach half a billion dollars in revenue in 2011." He also cited a 90% revenue growth in Q1 year-over-year. That's some pretty stiff growth. Considering how the company has been bouncing around on the comScore Top Ten video properties lists it's good to see they're on the up and up in the revenue department. They grew some 50% in regards to the number of advertisers they served. A stat I am frankly not all that impressed with. They do load up on ads already so I don't want them to think that's the continued way to go. No ads for Hulu Plus is going to be key to their continued success I think because they will continue to push ads on the subscribers to the point where people stop paying, and why wouldn't they when they can possibly get a lot of that Plus content that has ads for free elsewhere.
Toshiba just unveiled a new line of 3D panel televisions that will – for the first time – be available outside of Japan. And here's the real kicker: They're promising that at least one of these models will be completely glasses-free. You hear that, 3D fans? Nothing weighing down your face. Just good ol', unencumbered TV watching plus an extra dimension. Details at this point are scant, but Toshiba didn't shy from talking up their other projects, notably a new line of Regza VL passive 3D TVs. Each one is said to come standard with four ReaID 3D glasses, and will be available in 42- and 47-inch sizes. No word on pricing yet. In Japan, 12- and 20-inch glasses-free 3D TVs are already available. The catch is they can only be watched from nine very specific angles, which--let's face it--is far from ideal, especially at such tiny sizes. But if Toshiba lives up to its promise and delivers a full-sized 3D TV the entire family can enjoy sans shades (they're saying April 2012, so cross your fingers), it may change the game enough to give 3D a fighting chance.
Dish Network Corp. said Wednesday that it won the auction for Blockbuster Inc. with a bid valued at $228 million in cash. As of Tuesday, the satellite TV company, billionaire investor Carl Icahn and a group of debt holders were the three remaining bidders for the Dallas movie-rental chain, which filed for Chapter 11 bankruptcy protection in September. Dish's bid was for $320 million, but the value decreases to $228 million after adjusting for available cash and inventory. "Blockbuster will complement our existing video offerings while presenting cross-marketing and service extension opportunities for Dish Network," said Tom Cullen, executive vice president of sales, marketing and programming for Dish Network, in a statement. Blockbuster is already a shadow of its former self. When the chain filed for bankruptcy protection, it was down to 3,000 stores, less than a third of the peak of 9,100 in 2004. There are about 2,400 currently open with plans to close about 700 more by mid-April. Blockbuster used to dominate the U.S. movie rental business. But it lost money for years as that business declined because customers shifted to Netflix Inc., video on demand and DVD rental kiosks. Dish, based in Englewood, Colo., expects to close the deal during the second quarter. The transaction needs bankruptcy court approval.
Market research firm Infonetics Research earlier this month released its fourth quarter 2010 (4Q10) Cable, Satellite, IPTV, and OTT Set-Top Boxes and Subscribers market share and forecast report, now led by analyst Teresa Mastrangelo. ALYST NOTE "In the fourth quarter of 2010, we witnessed the dramatic growth of over-the-top services, as service providers and equipment vendors hit the 'sweet spot' for pricing. However, these services continue to complement pay TV rather than replace it. On a global basis, demand for set-top boxes continues to increase as more countries transition from analog to digital and more operators offer enhanced services such as high definition and DVR. We also are seeing increasing demand for hybrid set-top boxes, which leverage the existing broadcast infrastructure, but utilize the broadband connection to incorporate OTT content and increase interactivity and on-demand services," notes Teresa Mastrangelo, directing analyst for video (cable, satellite, IPTV video) at Infonetics Research.
Best Buy is rebalancing its channel strategy to address market share gains by online retailers, including Amazon.com. In the process, the company is dramatically expanding its online-only assortment, is promising to price those products aggressively, and has begun shrinking the footprint of some of its big-box stores as they come off lease. The chain has also not ruled out the possibility of closing some of its larger locations outright. In a fourth-quarter earnings call last month, co-Americas president Mike Vitelli said Best Buy will offer "very aggressive" pricing on a much broader online-only assortment to improve its price perception with customers. The move is designed to help counter mobile price-comparison technologies, which can put in-store stock at a disadvantage because price checks don't reflect value-added promotions like extended financing, loyalty program discounts and bundled offers, he said. The low web pricing will be achieved through a combination of supplier fulfillment, two-step distribution and Best Buy-owned inventory, he said. Still, CEO Brian Dunn stressed the importance of maintaining a brick-and-mortar presence to differentiate Best Buy from online-only competitors. Stores allow in-person consultations, provide a convenient pickup option for ecommerce orders, and will give the company a competitive advantage should tax policy favoring e-tail-only merchants change.
After selling its streaming media players primarily online for the last three years, Roku will now start selling its set-top boxes in Best Buy stores. This is Roku's largest retail partnership; it also sells its models through smaller chains BJ's Wholesale Club, Fry's Electronics and RadioShack. The deal demonstrates the growing interest among consumers in bridging online video and TV, and perhaps down the road, cutting their cable cords. Roku XD player will start appearing in Best Buy stores nationwide and on the retailer's website. The player has a list price of $79.99. In a statement, Anthony Wood, Roku's founder and CEO, claims that the company has already sold one million boxes via online retailers.
The so-called celestial jukebox that digital-music dreamers talked about in the 1990s looks a little closer. Early Tuesday morning, Amazon launched a Web-based music service that lets you listen to your songs from Internet-connected computers and Android smartphones. Called Cloud Player, it lets Amazon's "Cloud Drive" servers take the place of a computer's hard drive or a phone's flash storage--provided either device has a sufficiently fast connection to the Internet and a user whose Amazon account includes a valid U.S. billing address. The Seattle retailer provides 5 gigabytes of storage for free; buying an MP3 album from its store upgrades that quota to 20 GB. You can sync new Amazon purchases to your Cloud Drive automatically. But you can also upload other songs from a Mac or Windows computer using Amazon's MP3 Uploader. Contrary to what that name suggests, it will also upload AAC files bought from iTunes, provided they're not older purchases locked with the "digital-rights-management" system Apple retired in April of 2009.
XpanD 3D began licensing today a new active-shutter 3D standard developed with Panasonic, called M-3DI, that is intended to bring about compatibility among 3DTVs, computers, home projectors and cinema projection. XpanD chief strategy officer Ami Dror told TWICE the first licensor of the M-3DI standard is founding partner Panasonic, soon to be joined by other founding partners including Changhong, Funai, Hisense, Hitachi, Mitsubishi, Philips, Sanyo, Seiko Epson, Sim2 and Viewsonic. "The idea is to allow you as a user to buy a pair of glasses for a Philips TV, for example, and take them to an XpanD cinema, or use them to watch 3D on a friend's Panasonic TV, etc." said Dror. The standard uses two-way technology to allow communication between glasses and components. Once a user puts the glasses on, the glasses will recognize which brand and model component the user is viewing and will allow the user to adjust certain parameters, such as rate of transition time and dark time, to address user issues such as ghosting and brightness. The parameters can be adjusted using a PC or through an XpanD app on a handheld device.
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The network is the foundation on which modern entertainment, security, control and automation systems are built. The new Epic series of routers from Luxul are designed to help integration professionals build that foundation and deliver a great customer experience. The router is a critical piece of every network-connecting a local network to the Internet, controlling traffic and providing security. With the release of its new Epic series, Luxul has redefined the router, adding capabilities that make it far more than just a traditional router. In addition to being high-performing commercial grade routers, the Epic series offers a platform for optimizing the user experience in smart homes, workplaces, retail establishments and more. This experience is delivered through Luxul and third-party applications running on the Epic platform.