Roku buys Dataxu for 150 Million: The Strive to Become the Top OTT Platform Through DSP

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Image by: Getty Images, Roku, DataXu

Over-the-top media services (OTT) are a growing form of media consumption platforms that offer users the ability to stream media directly over the internet. OTT media service giants such as Amazon Fire TV and Roku have competed to be the top platform for years in a growing world of streaming consumption.

Roku recently has shocked the industry buying the DSP, Dataxu, a marketing company that helps media professionals use data to improve their advertising. Dataxu goes off their company mission which is “Our software empowers you to connect with real people across all channels, including TV, capturing consumers’ attention when and where it matters most” (Dataxu)

The deal between the merger consisted of a 150 million in cash/stock deal. Roku intends with this deal to be able to use the data/marketing company to better be able to compete with other major OTT platforms like Amazon Fire TV who currently claims north of 34 million users. Roku has around 30.5 million users as of the summer of 2019, but one key feature has set Amazon Fire TV and Roku apart. Amazon currently has its own Demand-side platform (DSP) which is a system that allows buyers of digital advertising inventory to manage “multiple ad exchange and data exchange accounts through one interface” (Wikipedia).

As Amazon Fire TV has begun to allow video publishers to sell advertising through their own DSP, Roku hopes to use their newly acquired DSP, Dataxu, as a media-planning tool to help optimize their business outcomes since the software provides marketers with an automated self bidding, and self-serve platform for managing advertising campaigns.

Roku will not only now be able to compete more strongly with other OTT media services with Dataxu as as Demand-side platform to help them drive their number of users, but also receive profit from Dataxu’s current users all over the world.

Acquisitions such as these put an emphasis on the idea of media convergence as well as the importance of media companies to be innovative and involved in marketing/advertising technology, an area in which most of these giants make their revenue off of. Instead of integrating their own Demand-side platform like Amazon, Roku raised the stakes of the game by buying one to not only help their growing media service platform, but increase company profit/share in the technology realm significantly.


Sources:

https://www.mediapost.com/publications/article/342311/roku-buys-dsp-dataxu-for-150-million-in-cashstoc.html

https://www.adweek.com/programmatic/streaming-service-roku-acquires-dataxu-150-million/

 

 

Shonda Rhimes Moves to Digital

Shonda Rhimes, the producer known for her ABC dramas series Grey’s Anatomy, Scandal, and How To Get Away With Murder stepped into the streaming world back in 2017 when she signed a deal with Netflix to produce a minimum of eight new shows. Her latest step was into the world of podcast, her production company, Shondaland, and iHeart Radio recently announced their new partnership. Within the new deal, Shonda Rhimes will produce more than a dozen new podcasts through her talented ways of storytelling that has gained her a tremendous follow of viewers and listeners. Shonda Rhimes’s division of the iHeart Podcast Network will be called Shondaland Audio. Shonda Rhimes has had a taste of the podcast life in the past with her podcast called Katie’s Crib which discusses motherhood and that show will now be apart of the iHeart Podcast Division with her future podcasts.

“Just beginning our digital journey” – Shonda Rhimes

This move to podcasts and deal with iHeart seems like the right move for Shonda Rhimes; iHeart Radio has been ranked #2 on the podcast measurement firm Podtrac with 268 shows downloaded 147 million times. With Shonda’s storytelling talent, it seems that she will be able to grab the attention of listeners and viewers on this platform. The president of iHeart Podcast Network, Conan Byrne, believes that Shondaland Audio will attract “an engage, smart female audience” and established major brands will want to advertise on her podcast for the best results.

iHeart can predict this audience because women tend to love to see women win and this is no different.

Netflix’s Final Calm Before The Storm

http://Netflix won’t ‘shy away from taking bold swings’ as streaming competition heats up – The Verge https://apple.news/A8w2FJP6DQG-d4Z5LedK5ZA

Netflix has been the top dog in the streaming industry for the past couple of years, and there was no sign of slowing down. The company now has over 158 million subscribers worldwide. During the second quarter Netflix’s revenue and subscriber count was increasing slower than usual. The company then turns around and brings in 6.8 million subscribers and $5.2 billion in revenue over the past 3 months alone. Both of those numbers are higher than they were at this time last year. The increase in subscribers has a lot to do with the recent release of Stranger Things. Stranger Things is an Netflix original, that is now on its 3rd season. The show has had great success since its initial season, and the 3rd season was watched by 64 million accounts in the first 4 weeks.

The next time Netflix receives its report earnings there will be 2 more media powerhouses now in the market. Disney, and Apple are releasing their own streaming services. Personally I would be more concerned with Disney rather than Apple. Based on the movies, and TV shows that is in Disney’s arsenal it could shake up the game. I would imagine that Apple will have a good amount of syndicated media, and test out some original content. HBO Max, and NBCUniversal are 2 other streaming services that are entering the market in 2020. The CEO of Netflix Reed Hastings isn’t really concerned about the new entrants in the market. He stated, ” While the new competitors have some great titles (especially catalog titles) none have the variety, diversity, and quality of new original programming that we are producing around the world”. Netflix isn’t slowing down, and they are still taking bold swings to increase business.

’Stranger Things’ have helped Netflix stay on top

As the competition for streaming platforms continues to grow, Netflix is having to defend its popularity amount audiences. According to the New York Times, Netflix loss 126,000 domestic subscribers earlier this year. However, Netflix was able to get those subscribers back according to the article. Author Edmund Lee explained, ”The third-quarter results benefited from Netflix’s best-known series, ’Stranger Things, ’ which introduced its hugely anticipated third season over the Fourth of July weekend. The series drew 64 million households in the first four weeks it was available, the company said.”

This was a big comeback for the company and not only helped them draw in more viewers but helped line Netflix’s pockets. Netflix’s stock jumped more than 8% in after-hours trading last week. In addition, the company also reported a large jump in profit from $665 million to $5.2 billion in revenue. This rise in profit follows the addition of 6.8 million new customers this quarter, with 520,000 of them in the United States. Netflix has big plans and big movies to help them beat the soon-to-come streaming platform competitors, Disney and Apple. Both of which plan to release their streaming platforms in November. As of now, Netflix is the nation’s largest digital television network, with over 158 million customers around the world, including 60 million in the United States.

Disney+ Launches a long list of Movies and TV Shows

Disney seems to know what its doing when it comes to this new streaming idea…

https://www.cnn.com/2019/10/15/entertainment/disney-tv-shows/index.html

Disney+ just released a whole bunch of content that they are going to be providing for their audiences. They announced their list on Twitter, posting a thread of all of the great and nostalgic movies/shows that they know people will die to see.

Disney+ will for sure have many deals once it is released in November, their goal is to wow customers and I believe that they have already done so. They shared at least 500 classic Disney movies and old shows like Hannah Montana and The Suite Life of Zack and Cody. They also include Marvel movies and newer movies like the remake of High School Musical. There are a lot of content that is loved by many people, which is exactly what they know and share with absolute pride.

There are also movies that bring me back to elementary school such as Cow Belles and The Shaggy Dog, which are mentioned in the article featured. Although I most likely won’t by a subscription to Disney+, I am pretty excited that the old shows are coming back in some way!

It is very smart for Disney to post their list of content that will appear on Disney+ on Twitter. I feel like that is the best place to post about it since many of the young adults who grew up with Disney channel are the most active people on Twitter.

Roku Is Growing

As of Tuesday, October 15, 2019, Roku has jumped 10% since announcing to the public that the Apple TV is now going to be available on their service. Roku is a streaming service that comes with equipment that is similar to the Apple and Amazon. Some are asking the question, how does the Apple app work on the Roku platform? Roku and Apple have made the arrangements for Roku users to access the Apple TV app by logging in with their Apple ID and passwords and once Apple TV+ launches, Roku users will also be able to subscribe to that as well.

Apple’s stock hasn’t changed much, and they aren’t the only one excited about this new deal. Roku’s general manager, Scott Rosenberg says “With the Apple TV app coming to Roku, our customers will enjoy an even broader range of exciting entertainment, including the highly anticipated Apple TV+ service”. This new deal is something that Roku enjoy and experience by having a vary of entertainment choices on their devices.

This deal is great accomplishment for Roku especially because they are a platform that is constantly competing with Apple and Amazon. It’s honestly a win-win for both Roku and Apple, because Roku gets to satisfy their customers and Apple gets more consumers to experience their products.

Consumer Video Streaming Spending Expected To Skyrocket

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Image: Apple Website

It’s the time in streaming that everyone has been waiting for. Four of the world’s largest media companies will release their own major premium video streaming service (Apple TV +, Disney +, HBO Max, and NBC Peacock). As cord cutting progresses and consumer markets move towards paying for media through streaming services, major players in the industry have recognized this shift and made moves towards innovation.

Consumer video streaming spending is forecasted to continue its rapid growth into the next year rising from 14.1 billion to an astonishing 22 billion. This 25% growth rate is one of the largest spending increases seen by media companies in history. The Consumer Technology Association believes this year will be the sharpest increase in consumer video streaming spending as new platforms are released, which will eventually lead to a steady level-off in the next coming years.

In addition to consumer subscription spending, researchers also predict the sales of popular smart TV’s will also see a significant 4% increase in sales to around 29 million. Though many have a positive outlook on smart TV’s, the increase in sales is significantly lower then streaming platform spending due to the fact that not all smart TV app software includes the large selection roster of channels that platforms like Hulu, Netflix, and Disney + have.

Another interesting area in streaming that media analysts are anticipating to see in the next coming year is growth in “free ad-supported” video streaming from popular companies such as Tubi, Pluto TV, and Xumo. Though not as profitable as their competing counterparts, many are interested to see how these companies will fair in this industry shift.

Many are calling this enormous growth phase in how consumers receive and choose their media one of the most influential events in media history. What is interesting to see is the amount of selections and control these companies are giving to its customers and the level of satisfaction they will seek from these platforms. A large question that still lingers going forward as these new platforms such as Disney + and Apple TV + unveil their services is how hard will it be to access specific content without these paid subscriptions?

For example, if an individual desires to watch popular TV shows such as “It’s Always Sunny in Philadelphia” which is a production by FX Network (a television unit of the Walt Disney Company), will the famous series only be available through a subscription to Disney +? These kind of questions are what could potentially be make or break for the streaming industry and will place a heavy focus on the strategy and marketing of these media giants software moving forward.


Sources:

https://www.mediapost.com/publications/article/341734/consumer-video-streaming-spending-to-see-sharp-24.html

 

A.I. Music Making Black Mirror Come True

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Article: https://www.digitaltrends.com/cool-tech/auxuman-ai-album/

Image: https://rateyourmusic.com/artist/auxuman

This article comes from Digital Trends and is written by Luke Dormehl. The focus of the article is A.I. musicians and their popularity. It isn’t about vocaloids or computer-generated personalities, it’s about computers, A.I. personalities, creating music. Auxuman is the name of this A.I. personality and September 27th, the A.I. released its first album and promises to create a full-length album every month. Computer engines create the words, melodies, and voices and creates lyrics through poems and expressions it learned online. Dormehl quotes, “Yona and her Auxuman friends are, in a sense, a reflection of human life on the internet. Expression on each song comes from stories we have told, ideas we have generated, and opinions we have shared” (Dormehl 2019). One of the reasons Auxuman was created was not to fulfill people’s need to always have new content, but rather to speed up the process of creating new genres. This article discussed how new music has a tendency to sound the same because humans stick to what is successful, they don’t want to create new genres because they like the current ones. This is why Auxuman is so different. It can create brand new types of genres and its feelings won’t be hurt if a song does poorly.

I found this article to be interesting because it was a subject that black mirror touched in June of 2019 in the episode called Rachel, Jack and Ashley Too. The premise of the episode was a popstar falls into a coma and her manager created a new album from the singer’s subconscious and used A.I. to create a holographic recreation of the singer and to generate new music and recreate the singer’s voice. This idea of A.I. personalities creating music is very interesting because it takes out the human part in music. As mentioned above, the computers learn from poetry and what they learn from human expression online. A.Is. have been used before to try and create a realistic computer that one can talk to. The outcome of those were that the internet is very hateful and these A.Is become very harsh and adapt the speech patterns of whoever talks to it the most. I listened to one of the songs from Auxuman’s first album and it was bizarre. The A.I. didn’t sing, it talked with a hum at the end and the lyrics didn’t make much sense. From their song “One” the beginning lyrics were, “I never felt alone, you never said a word. I fell from my throne, you didn’t want me there”. Coming from a computer, those lyrics are a bit chilling. This concept is very interesting and new genres can come from these A.I. personalities, but how would it feel to say the next best genre was created by a computer? Having The Beatles known as a group that shaped the genre of their time, what does it mean when the next “voice of a generation” is an artificial intelligent personality?

Locast, a non- profit streaming services sues BIG media companies

Disney’s ABC, CBS, Comcast’s NBCUniversal and Fox were all countersued by a non-profit streaming service called Locast. You might be wondering: why?

According to a CNN article by Kerry Flynn, Locast sued these companies because they violated code of conduct and illegally worked together to grow the strength of their market. Why might Locast be angry and involved? Locast has the right to be raged because they stream content from these media companies on their provided service.

The issue took a war turn when the companies Locast wanted to countersue joined together to accuse Locast of copyright violations. To give more context about Locast, they are a free app to users and they are available in thirteen cities, including major ones like New York. They stream from bigger companies for people who don’t really rely on a antenna.

After being accused of copyright allegations, Locast denied it stating that they are a non-profit company. The article specifically states that, “Goodfriend launched Locast in January 2018 within a non-profit entity, which argues that the company has the legal right to rebroadcast local stations without being accused of copyright notice from networks” (Flynn, 2019).

There have been many times where a streaming service has gone against a network. This topic is interesting because it seemed pretty childish to me. If the non-profit called out big companies on an issue, why would they turn around and also point the finger at Locast? Locast streams their content, giving them a wider audience. Just because it is a non-profit and they are supported differently, doesn’t mean they wouldn’t be affected.

Source: https://www.cnn.com/2019/09/27/media/locast-streaming-lawsuit/index.html

45% Might Cancel Netflix If Favorite TV Network Shows Depart

A recent study based on Netflix subscribers found that almost half of Netflix’s subscribers would consider canceling their subscription if networks pulled their content. Networks like NBC, Fox and AMC have content on Netflix that draws a pretty big audience, and some people may even use Netflix strictly for those programs.  Programs like “Friends”, and “The Office” are fan favorites on the app, and NBC could make a lot more money if they streamed “The Office” strictly  on their own services. Other media companies like Marvel have started to take down their content from Netflix for when they release their own streaming service.  We are in a time where every big media company and TV network is starting to come out with their own streaming service to house their content.  There is a big shift from cable to streaming, and the networks are trying to make the most out the opportunity with their top watched content right now on services like Netflix, Hulu, Amazon Prime. 

            Netflix started to make some noise in the industry with their original content like Bird Box and Black Mirror.  Netflix has a lot of great in depth  documentaries on a lot of different topics. That is not the majority of their income, so it is going to be interesting to see how they will adapt if the networks follow through with pulling their content. Will they shift their focus, or will they just put more money and time into their original content. 45% is a very high number of subscribers and if those talks are semi serious I would be concerned if I was Netflix. I would be putting a lot of time into think about how we will adapt if those reports become reality.