HBO is launching a stand-alone streaming media service in 2015

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4thWEB curated content from The Washington Post
By Cecilia Kang (see full article)

HBO is set to launch a stand-alone online streaming media service in 2015 that will not require a cable or satellite subscription. (Reuters)

HBO will launch a streaming media service in 2015 that doesn’t require consumers to have a cable or satellite subscription, the company said Wednesday, in a move that could roil the television industry and pave the way for vastly more choices for consumers.

With HBO’s announcement, television fans have been given one more reason to drop their expensive cable subscriptions, a growing trend in recent years as viewers have enjoyed more choices online through streaming media services like Netflix, YouTube and Hulu.

Up to now, many households have decided to continue paying for cable since they value live sports on ESPN and wildly popular shows on HBO, such as “Game of Thrones”– all content they can only get through a cable box.

But HBO’s move could change that calculus.

“This is an enormous breakthrough; consumers will be able to get to pick what they want and they will finally have content companies selling directly to them,” said Gene Kimmelman, president public interest group Public Knowledge, which has fought for regulations that would force the unbundling of cable television channels for consumers. “The question is, ‘Who is next’? That’s trickier because this speaks to the power of HBO’s brand to be able to break from the cable bundle.”

HBO chief executive Richard Plepler, who announced the plan in an investor meeting held by parent company Time Warner, did not say how much the streaming media service would cost or what content it would offer exactly. He said starting next year, the service will be available to U.S. subscribers and to consumers in two other countries before expanding to its entire international footprint.

Plepler was careful to describe the streaming media service as complementary to cable, rather than something aimed at busting the industry’s business model. He said HBO is targeting the 10 million homes in the U.S. that have high-speed Internet but don’t subscribe to cable or satellite television already.

“It’s time to remove the barriers to those that want HBO,” Plepler said.

The way things works now, cable firms and HBO have enjoyed a highly profitable and close relationship. HBO charges cable firms hefty fees for the right to carry their programming; cable companies in turn charge consumers additional money–say, $10 or $20 per month–to add HBO to their selection of cable channels. The linchpin of this arrangement: HBO agreeing to offer its content exclusively to cable companies.

But in recent years, HBO has grown impatient with its cable partners, saying many have not done a good job of marketing the premium channel. Plepler said “hundreds of millions of dollars” have been left on the table through untapped distribution rights and poor marketing for new subscribers. And studies show younger viewers — particularly millennials — are choosing online video subscription services over cable TV.

In May, Amazon and HBO announced a deal in which Amazon Prime members could watch a slew of HBO shows, films and miniseries–mostly past seasons of old shows like “The Sopranos.” When asked by an analyst if the plan will hurt HBO’s cable business, Plepler said: “I don’t think this is either or,” adding that 85 percent of Netflix’s users also subscribe to cable or satellite television. He said the HBO online service would be offered in partnership with Internet service providers, who are also their cable partners.

The announcement Wednesday is a striking reversal for parent company Time Warner, whose chief executive Jeff Bewkes in 2010 famously dismissed the threat of Netflix, equating it to “The Albanian army” or a “200-pound chimp.”

But with an online streaming media service, HBO is taking a page directly from Netflix and will soon compete head-to-head with the rival streaming service. HBO has 30 million subscribers in the United States; Netflix has about 37 million.

Netflix has modeled itself after HBO with its mix of exclusive award-winning original shows like “House of Cards” and movies. “We have to become more like HBO before they become like us,” Netflix CEO Reed Hastings said in an interview last summer, referencing a favorite saying of the company’s chief content officer, Ted Sarandos.

With HBO stripped away from the cable bundle, Netflix loses one of its advantages over its rival. The company, which reported Wednesday that it added fewer subscribers than anticipated, saw its shares tank about 25 percent in after-market trading.

As much money as HBO makes from cable companies–the company made $4.9 billion in revenues last year, mostly from fees paid by cable firms–the future of watching television is clearly online. According to a report by Comscore this week, four out of ten online users subscribe to a service like Netflix or Amazon Instant Video.

“I find it hard to believe that HBO is going to offer something that will make [cable companies] angry,” said Deana Myers, an analyst for research firm SNL Kagan. She said the key will be how much the online streaming media service is priced.

streaming media service

The big question is how much HBO charges for the online service. If the company sets the price too low, many consumers will drop their cable subscriptions and eat into the firm’s profits from that business. But set it too high, and viewers used to the roughly $10 per month charged by Netflix and Hulu Plus will balk.

The availability of more online content will provide more choices for consumers. But it won’t necessarily reduce costs. Cobble together HBO, Netflix, MLB.tv and a few more services and being an online-only viewer adds up.

And even though HBO’s announcement weakens the hand of the cable industry, firms like Comcast still enjoy a huge advantage: exclusive live sports.

As a result, consumers like Avi Greenberger won’t stop paying for the monthly streaming media service. The 25-year-old Brooklyn resident subscribes to HBO, sports channels and online services such as Hulu Plus. “I hate double paying for both cable and online services,” Greenberger said. “But with the Rangers on MSG and the Yankees on Yes Network, it’s hard to give up on cable.”

Will there be football and basketball streaming online for people who don’t pay for cable or satellite? Not anytime soon.

This month, ESPN and TNT inked deals to retain rights to show NBA games through the 2024-25 season. And the National Football League and ESPN have a deal to keep “Monday Night Football” on the sports network through 2021.

Vine is Blowing Up for Brands – Why?

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Vine Blowing Up for BrandsVine is the latest social video marketing platform and it’s taking off like wildfire. CNET reports Vine has 40 million users. And this is even after Instagram decided to copy Vine’s short video concept and use it on its social photo site. Twitter hit the nail perfectly with its six-second, looped videos. And brands are climbing on board to take advantage of their own efforts. And courting prominent Vine users to create videos featuring their brands.

Vine – Six Seconds of the Right Stuff

WebProNews reports Twitter users are just as likely to watch Vine videos as they are YouTube. The short videos match perfectly with the short message platform that Twitter provides. And brands need to learn how to show a concise, visually compelling method to catch attention. There are a variety of industries taking advantage of Vine. Although those that can be condensed into a short visual medium are doing the best. Examples include Urban Outfitter’s clothing selection. As well as Next’s furniture and the “Wolverine” movie. Stop motion is also a commonly used technique to fit more into a single clip.

Going Viral with Vine

You have only a few seconds to catch your customer’s attention. Vine’s six-second limit makes you work within a strict framework. You literally only get those few seconds to figure out how to attract the customer. And keep them watching and get your brand message across.

Humor is always one of your best bets for getting your Vine video to go viral. For example, Dove created a Vine video that shows people bowling with their soap and bath gel products. That’s a cute and clever way to show off their products. If your marketing message isn’t conductive to humor, try using visually distinctive techniques. And don’t forget to take advantage of the endless looping in Vine.

Also, don’t forget the appropriate hashtags. Since you do want to reach as much of your target audience as possible. Lowes has a particularly good Vine account. According to Adverblog, they utilize hashtags very effectively. The home improvement store uses brand specific and general tags, such as #Lowesfixinsix and #Howto. Vine videos are simple to share on other social networks. So don’t skimp on spreading them around and leveraging your existing audience.

Bring in the Vine Experts

Vine has only been out for seven months. But that’s more than enough time for some users to truly figure out what makes Vine tick. Some of these users are brands you can draw inspiration from. And some are budding Vine celebrities who are enjoying their Internet fame. The top Vine users include Jethro Ames. He produces household and how-to videos. Also, Khoa makes his videos out of construction paper. Also, Meagan Cignoli plays up the celebrity angle by posting behind the scenes fashion model Vines. Some of them are also more than happy to take money in exchange for creating custom Vine videos for your business. And promoting it to their entire social network. If you don’t want to go through trial-and-error to figure out exactly what you’re doing on Vine, this is one of the best ways to spend your marketing dollars.

Vine – Great for Slow Internet

YouTube has certainly generated plenty of brand awareness and money for businesses. But there’s one area it has a hard time penetrating. Rural areas of the United States suffer from limited Internet access. Those areas aren’t able to easily watch YouTube videos and other high-bandwidth content without the help of satellite Internet services. The Vine format is fast and quick-loading, whether you have a satellite Internet service such as Hughesnet.com or not. Essentially, Vine provides a similar marketing experience to YouTube without cutting off this massive user demographic.

The Social Media Revolution Will Not Be Televised But it Will be on Your SmartPhone

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Social MediaSocial media, social media, social media: it seems like social media is all anyone ever talks about anymore when it comes to online marketing, or even marketing in general. These days, it’s practically more common to hear spokespeople say, “Visit us on Facebook at ____” than it is to hear them say “Visit us online at ____” or “Call for a free catalog”. With so many people talking about social media and clamoring to be in the front seat of the social media bandwagon, it’s hard to sort out exactly how social media has already affected businesses, and what changes might be expected for the future.

Almost one in five human beings on the planet who have access to the internet have a Facebook account. Meanwhile, there are 65 million Twitter posts each day, and 2 billion YouTube video views per day (Source: ReadWriteWeb.com). However, what does all of this mean for the way we conduct business? Furthermore, how will social media continue to evolve in 2011? Here are a few ideas about the changing face of social media, and what it means for both marketing professionals and the bottom line of businesses everywhere.

As a culture, we have experienced several profound shifts in the way we receive and process information about our world. The first shift was from word-of-mouth gossip to slightly more reliable newspapers, an era that lasted until television took hold and men like Walter Cronkite helped us to watch and interpret the news of the day. In the last several years, the shift has clearly been away from television and towards the internet. TV news is scrambling to hold onto its piece of the pie by offering online video, blogs, Facebook pages, and ongoing Twitter conversations. However, the next step is from the computer to the smart phone.

At the moment, only 21% of mobile phone users own smart phones, but this will change in 2011. According to the Nielsen blog, the US market will have more smart phones than feature phones by the end of the year (Source: CyberJournalist.net).

Social Media and the Smart Phone revolution: other facts marketers should know

1. According to its forecast, IDC says the number of downloaded mobile apps is expected to increase from 10.9 billion worldwide in 2010 to more than 76.9 billion in 2014. In addition, worldwide mobile apps revenues will experience similar growth, surpassing $35 billion in 2014.
2. Email access is declining for computers, but rising for iPhones
3. Close to 40% of Facebook users access the social network through their phone (Source: Facebook.com).
4. 200 mobile operators in 60 countries are deploying and promoting Facebook mobile products (Source: Facebook.com).

To join in the rush to integrate Social Media with Smart Phones, businesses need to do three things

1. Make sure that their existing social media is mobile-friendly.
2. Test web and video content on mobile devices.
3. Successfully communicate to their customers what available apps and other mobile goodies they have available, and make it readily accessible.

Broadcast Yourself via Social Media

[4thwebvids video=”Pblj3JHF-Jo” embeddedHeight=”295″ embeddedWidth=”480″ autoplay=”false”]

YouTube’s longtime slogan, “broadcast yourself”, will be more relevant than ever as online videos multiply like overactive rabbits. Video content online has taken off in the last two to three years, but in 2011 expect it to get even bigger. October 2010 alone saw 5.4 billion video views worldwide, including 2 billion views on Facebook. (Source: ComScore.com).

Businesses forget about YouTube as a social media outlet at their own peril. Just as companies that were painfully behind the times in the early 2000s claimed they didn’t need a website, companies today will fall behind the times if they don’t have a YouTube channel, or some other way of promoting video content and integrating it across multiple online marketing channels.

Facts about online video every Social Media marketer should know

1. Nearly half of business executives age 40 and under report utilizing video to help them make decisions about vendors – this number will only increase as 20 somethings and 30 somethings climb the corporate ladder (Source: eMarketer.com).
2. 90% of videos watched online are watched on YouTube (Source: SocialMediaB2B.com).
3. The average consumer watches 182 online videos every month (Source: DigitalBuzzBlog.com).

What does this mean for businesses? If they don’t have video on their website now, they will by the end of 2011, unless they want to look like a dinosaur.

The World Will Be Different in 2011, But the Same

As Mark Zuckerberg told Time in his Person of the Year interview, humans “parse data” via the algorithm of relationships. That is the key fact, he says, that has made the social networking revolution possible. People don’t want an internet full of strangers; they want the internet to feel as cozy and safe as their living room.

Zuckerberg sees the future of Facebook as an entity that is more and more woven into the very fabric of the internet. If he’s right, one day online users might surf to a site like CNN.com, and instead of seeing comments on news stories by strangers, comments by their Facebook friends might pop to the top of the list.

As the Person of the Year honor and recent Golden Globes for The Social Network clearly demonstrate, Zuckerberg’s way of approaching the internet have struck a chord with the citizens of the digital world. Social media has fundamentally changed the way we think about everything – from how we keep in touch with grandma to how we buy new shoes – but what hasn’t changed is why social media is so popular. Ultimately, it is Zuckerberg’s insight that we “parse” the world through our relationships with others that is the golden goose laying the golden eggs of social media marketing.

Businesses that want to succeed with social media marketing in 2011 must always remember this basic fact: fancy Facebook landing pages, high-quality videos, and constant Twitter updates are not what their customers are looking for. What they are looking for is a way to connect, a way to interact, a way to feel like they “know” the people they are buying from. In other words, businesses would do well to keep in mind that the first, most important word in “social media marketing” is still, and always will be, “social”.

Web Marketing Video Trends for 2011

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Web Marketing Trends in Video

Of all the changes in the ever-shifting landscape of web marketing, perhaps one of the most influential has been the increasing ease of viewing video content.

web marketing video trends

From local news stations to moms with a camcorder, video content is now ubiquitous on the web. Take these recent statistics:

• 62% of B2B marketers user video content as a part of their web marketing and social media marketing campaigns (Source: below)
• Almost half of small businesses intend to increase online video in their 2011 web marketing budgets (Source: below)
• 65% of C-level executives have visited a vendor’s website after viewing a video, and 42% made a purchase as a result of viewing a web video (Source: below)

It’s not only overall viewership of online video that’s on the rise; accessing this content via mobile devices is also skyrocketing as smart phones become pervasive. In fact, mobile video delivery company ByteMobile predicts that 60% of mobile network traffic for 2011 will be video content (Source: below).

Together, the increased use and viewership of online video, combined with the increased use of mobile devices to view these videos, is an advertising revolution in the making. Who will the winners in this new advertising environment be? Here are some thoughts.

Video Ad Interactivity

Chris Young, the CEO of Digital Broadcasting group, puts it this way:
With video channels like YouTube offering the viewer the ability to skip over advertisements on certain videos, marketers need to have some sort of added value to the content they’re distributing. You can’t just beat a consumer over the head with your static video ad and expect them to take action. In 2011, advertisers will have to be just as focused on content creation as today’s leading online publishers (Source: below).

In other words, with so much user-driven content and emphasis on interactivity in the online world today, static video ads will gradually come to be seen as old-school and irrelevant – the online equivalent of the local used car salesman showing up on a cable TV ad in a gorilla costume. Just as they do in front of their television sets, expect viewers to increasingly roll their eyes and change the channel on static video ads.

Interactive YouTube ads are new, but by the end of 2011 they’ll start to become standard. Marketers who take advantage of the trend while it’s still intriguing for viewers will be rewarded with much more leverage out of their ads.

Humorous Ads Still Rule Viral Video

The mere words “snakes on a plane” were enough to ignite a viral video bonanza back in 2006. Why? Because it was funny! Parodies, fan-created videos, allusions in television, and even video games came out of the viral buzz just because everyone found those four words to be so amusing.

Fast forward to 2010, when the Old Spice online videos with “The Man Your Man Could Smell Like” theme earned more than 25 million views. The brilliant team at Wieden + Kennedy made additional spots that were video responses to YouTube and Twitter comments using the same popular look/feel. This move by Wieden + Kennedy opened up a whole new paradigm of what was possible with viral video ads. Once again, the key to their success was smart humor.

Even amongst non-commercial viral videos, humor rules. The homemade “Charlie bit my finger – again!” features a little boy sticking his finger in his baby brother’s mouth. The 56 second video has already earned almost 3 million views. Earning 78 million views is the bizarre “Potter Puppet Pals: The Mysterious Ticking Noise”, which features hand puppets made to look like characters from Harry Potter merely repeating their names in a sing-song manner. It’s strange, but it’s funny – funny enough to be one of the most popular YouTube videos of all time.

Has the point been made? Interactivity is great, but humor still trumps all in viral videos, no matter where it’s viewed.

Bite-Sized Videos Work Best

A B2B marketer might be seriously tempted to create a twenty-minute video featuring all his product’s best benefits, but he should resist this temptation. Both brand-oriented videos and home videos that go viral tend to share the common characteristic of being four minutes or less.

Case in point: one viral video, in which a dog pulls a little girl forward and dumps her into the pavement, is three seconds long, proving that three seconds of good content is worth much more than twelve minutes of bad content. Moreover, which is a viewer more likely to watch through to completion – the three second video, or the twelve minute video?

This is not to say that all longer videos should be avoided. After all, a particularly funny set of YouTube video reviews of the Star Wars prequel movies have earned millions of views, and each of them are more than ten minutes in length. The main point here is that online users most often consume both text and video in bite-sized chunks.

Part of the reason people like to watch short videos may be the overall decrease in human attention span in the age of the internet, but there are practical reasons, as well. First there is the issue of processor speed. Online video is smoother than ever, but people with slow computers or mobile devices still experience choppiness or viewing interruptions, which is often made worse with longer videos. When such a viewer anticipates difficulty watching an online video, they are much more likely to watch a short video than a long video.

The second issue is the where and the how viewers are watching. Viewing a viral brand video at work is much easier to justify when the video is three minutes long versus twelve minutes long. Likewise, the initial phase of an executive beginning the process of product and/or vendor research, which might include viewing videos, will likely include reviewing a number of different marketing messages. Such an executive will probably be more likely to slow down and watch a two minute introductory video at the beginning of such a process than to take the time to watch a twenty minute video. They might watch the twenty minute video later, but probably only after the two minute video compelled them to do so. Watching on a mobile device on the run, too, makes short videos preferable over long ones.

These are just a few of the video marketing trends to expect in 2011. In all, the next three or four years should prove to be exciting ones for both online video viewers and producers alike as online videos continue to evolve.

Sources:
MarketingSherpa.com
Ad-ology Research
Forbes Insights
Business Wire
ReelSEO

Reading Websites Online? That’s so 2007: The Rise of Online Video

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Who has time to read anymore now that Online Video is so pervasive? According to Forbes Insights, not many people do have time to read. A recent survey showed that the majority of business people in America:

Online Video

  1. Watched more Online Video in 2010 than 2009
  2. Prefer to watch Online Video on a web page before reading the text
  3. Are trending toward preferring Online Video over text even for reviewing business information

In addition, the survey also showed that roughly 75% watch work-related Online Video once per week or more on business websites, while more than 50% of business people watched work-related Online Video at least once per week on YouTube. A surprising 26% of American executives watch Online Video content for work purposes every single day on business websites, and 18% of executives watch similar content on YouTube every day.

Why Online Video is becoming more important for businesses and products

Here’s a pop quiz for you: do you remember the original Oregon Trail computer game? Millions of men and women in their late twenties and early thirties – men and women whose careers are just beginning to take off – do. They remember watching their oxen plod along on the green-and-black Apple IIe monitors in their school’s brand new computer lab, while trying to save little Jimmy from cholera, and hunting that 987 pound buffalo with arrow keys and a space bar.

If all of this sounds very strange to you, you probably didn’t grow up in the 1980s, when Oregon Trail was one of the only decent educational computer games that kids could play.

The kids who were ten years old in 1986 are 34 now, and they are natives to the digital landscape, hardly able to remember a time without computers. They’ve owned cell phones since they were in college, and “Amazon” is a “look-for-it-there-first” store, not a river or a jungle. They do their Christmas shopping online, and now that they have their own office at work and their own work-provided Blackberry, they navigate through the digital world for professional purposes as easily as they once navigated rivers on Oregon Trail.

Oregon Trail Game

The same Forbes Insights survey found that online video is effective in encouraging all executives to visit a vendor’s website, contact a vendor for more information, or make a business-related purchase, but among young executives, the numbers are even higher. Consider these statistics:

  1. 45% of executives 40 and under reported calling a vendor after watching an Online Video, but only 22% of executives 50 and older made such a call after seeing a video
  2. 43% of execs 40 and under called a vendor after seeing a B2B Online Video ad; only 17% of execs 50 and older did
  3. 46% of execs 40 and under called a vendor after seeing a B2B Online Video ad on YouTube; only 11% of execs did

The reasons why B2B Online Video is important and getting more important is obvious

Many of those kids who used to play Oregon Trail are now iPhone-wielding decision makers who are far more likely to find new information online than in a trade journal. In six more years, that original batch of Oregon Trail-playing ten year-olds will be forty, just reaching the peak of their business careers and their family lives. The thirty-four year olds below them – those who are twenty-six today – will be even less likely to remember a time when work included clunky things like Rolodexes and the Yellow Pages. They will have been more likely to have used Wikipedia to research a college paper, and YouTube was around when they were still in high school.

In other words, if the 34 year-olds of today are already using B2B Online Video to make purchasing decisions for their companies, by the time those in their mid-twenties reach the upper echelons of their respective companies, using Online Video to make a purchase decision will simply be standard practice.

Online Video – An Essential Part of a Social Media Campaign

Normally, when people talk about “social media” and “social media marketing”, their thoughts turn towards Facebook, Twitter, LinkedIn, and perhaps Digg or Technocrati. However, YouTube is one of the largest social media outlets there is, and smart B2B businesses know it. In fact, YouTube is the world’s second largest search engine, right behind its parent company, Google. Neither Yahoo! nor Bing come even close to the number of searches performed each day, and over 90% of Online Video is watched on YouTube (Source: SocialMediaB2B.com).

Smart B2B marketers are starting their own YouTube channels and incorporating Online Vdeo onto their websites and Facebook pages. They’re learning how to get better organic search results for their Online Videos, and they’re drawing customers into their products not with words, but with images and Online Vdeo. Just as websites became a standard part of reaching new business customers in the last decade, online video is sure to become another standard addition to every business’ overall marketing strategy.

Reading Websites Online? That’s so 2007: The Rise of Online Video – Another article on Online Video from 4thWeb.