Month: July 2020

Free Movie Screenings Brought To Consumers Safely At Home

Posted on by Mike Vorhaus

Originally Posted on Forbes

We are now in the very heart of the summer movie extravaganza – at least that would have been true in past summers. But now, across America movie theatres are closed, openings are being pushed back and films are languishing unreleased or pushed out of the in-theatre queue to be released digitally. The Covid-19 pandemic has almost entirely shut down the film industry worldwide.

Despite the massive economic and safety challenges for movie makers and for film attenders, Screen Engine/ASI, a growing movie, TV, digital and entertainment research and strategy company based in Los Angeles, has announced the launch of a new digital, Internet-based product providing a promotional marketing tool for film, TV and video production companies in the era of a stay-at-home society.

Traditionally, movie companies have used “test” screenings and “buzz” screenings to assure the quality of the movies and to create excitement around the upcoming launch of the movies, particularly in key markets. Now, of course, the studios have lost their access to the movie theatres where traditionally hundreds of thousands of consumers have gathered annually to watch movies free for testing or marketing purposes.

Screen Engine/ASI has released the “Virtual Screening Room” so movie and TV studios can still host “word-of-mouth screenings” and create buzz for upcoming movies, but safely and remotely in movie fans’ homes.

Running these promotional screenings online, vs. inside the confines of a theatre, however, raises worries about security, particularly the pirating or copying of films before they are released. The Virtual Screening Room has been designed to provide security safeguards against such problems, according to Screen Engine/ASI.

Andrew Ly, founder of ticktBox, which was bought by Screen Engine/ASI last year said in an interview with The Hollywood Reporter, “We’ve built a one of a kind cross promotional and marketing platform for studios to run their promotional screenings all within one suite in response to the social changes resulting from the virus outbreak, while eliminating the health concerns of attendees being physically present.” Ly said the new product from Screen Engine/ASI will be used by a number of studios to aid their film marketing, including a premium video-on-demand title coming out later this summer.

TicktBox’s parent company Screen Engine, is one of Hollywood’s leading research and data firms, and is backed by the prominent NYC-based private equity firm, The Wicks Group. Screen Engine has been hiring numerous big names from the TV and movie industries to drive their expansion, including the hiring of Bruce Friend, as Chief Product and Innovation Officerlast year, who has lead numerous research companies, as well as being the executive in charge of research at a number of big studios. Screen Engine also quietly hired the former head of TV station research and consulting at Magid Associates, Steve Ridge, to expand Screen Engine’s work with TV stations. A source who asked to remain anonymous, said that the appointment will be formally announced in the weeks ahead, along with key new clients.

Kevin Goetz, Founder and CEO, Screen Engine/ASI, in an exclusive interview with me, said that he has been building a firm “with the best minds and connections in the industry.” He went to say. “I am thrilled to lead the launch of our groundbreaking virtual, word-of-mouth geographic targeting for entertainment marketing. Our goal is to work with clients and their agencies to optimize their marketing spend by ensuring they are targeting and reaching audiences that are most likely to drive positive word-of-mouth, and in turn, realize full market potential for entertainment IP. In the next few months, our new market targeting solution will expand to allow clients to build customized targets for specific genres and franchises.”

William Shatner, one of the great icon pop culture figures of our time, from Star Trek to pitching Internet company, Priceline, once said, “I love to go to a movie, get a Diet Coke and a barrel of popcorn.” We will be waiting to see if the movie industry can send us all popcorn (buttered or not as you please) alongside our digital content.

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The New Advertising Zeitgeist—Google’s US Ad Revenue To Decline

Posted on by Mike Vorhaus

Originally Posted on Forbes

As the second half of the calendar year begins, many on Wall Street and Madison Avenue are wondering where advertising revenues will net out for the first half of the year and what the second half of 2020 will be like for the advertising market.

EMarketer recently predicted that in 2020 Google’s US advertising revenue will decline by just over 5% by end of the year. This is the first time, according to eMarketer, since 2008, that Google’s US digital ad revenue will decline. EMarketer had estimated that US ad revenues would grow about 13% before the Covid advertising recession hit. Google’s US market share for search advertising is projected to go down from 61.3% to 58.5% in 2020. Google makes up a huge portion of the total revenue of Alphabet, its parent company. Emarketer predicts that total advertising revenue in the US for 2020 will be $134.7 billion – an increase just under 2%.

These Covid-related headwinds for Google come along at the same time as Facebook is dealing with a boycott of Facebook advertising by numerous companies. Nonetheless, eMarketer still forecasts a small increase for Facebook’s advertising revenue in 2020. Amazon, who has been on a tear in selling advertising, is projected to have in 2020, an increase of 23.5% over their US advertising revenue last year, despite the Covid pandemic.

All of these media companies will have to deal with the constant shifting of the sands in the Internet

advertising landscape. Will Snapchat become a bigger player in the advertising arena? Will TikTok’s US advertising revenue grow at scale enough so that they too

become a bigger player in the advertising marketplace? Will the AVOD (Advertiser-supported, free, video on demand) digital video services eat into TV advertising marketing dollars? Who knows what the next “new thing” will be that will attract consumers’ and their eyeballs? Overtime, it is clear that ad dollars follow consumers’ eyeballs. We will know the actual revenue results for Alphabet and Google when Alphabet reports its second quarter earnings on July 23.

As Mike Kelly, former CEO of The Weather Channel and a long-time executive in the advertising and media world, said to me in an interview, “It is almost inevitable, that as competition increases from all comers, that Google will revert back to something closer to their ‘fair share’ of the ad market. After all these years, search is still their dominant product. As consumer intent and discovery (and attention) shifts to other platforms, so will the advertising dollars.” 

On the other hand, another major business model of the Internet – ecommerce – is likely to have a very strong year of growth. Ecommerce is poised to grow 18.0% following a 14.9% gain in 2019 according to eMarketer.

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Tencent Moves Into Video Streaming In Malaysia And Launches A Twitch Competitor In The U.S.

Posted on by Mike Vorhaus

Originally Posted on Forbes

Tencent, the huge Chinese-based, worldwide gaming (Riot, Supercell) and messenger/social media (WeChat) digital company has undertaken new initiatives in the important, growing area of digital video.

Tencent recently announced their purchase of a Malaysian video streaming platform, iflix’s content, technology, and resources. It was also revealed very recently by Bloomberg that Tencent has launched trovo.live in the U.S. the beta “testing” stage, which is very common with digital products. When you checkout trovo it is very similar to Twitch, the livestreaming video, esports and multiplayer games-oriented, video streaming service bought by Amazon in 2014 for reportedly just short of $1 billion.

Tencent also recently paid $263M for a controlling stake in Huya, the Twitch of China. Further demonstrating Tencent’s commitment to digital video, Tencent owns a video subscription service, Tencent Video, with over 110 million subscribers in China.  

In regard to the Malaysian video streaming acquisition, James Mitchell, the Senior Executive Vice President and Chief Strategy Officer of Tencent said in an email interview with me, “Tencent has purchased iflix’s content, technology and resources. This is in line with our strategy to expand our international streaming platform, WeTV, across Southeast Asia and to provide our users with international, local and original high-quality content in a wide range of genres and languages.” 

Mitchell went on to say, “We are committed to invest in the growth of the OTT industry in the

Southeast Asia region. The growing adoption of mobile devices has resulted in increased internet users and their access to OTT content. SEA’s OTT market shows a robust trend where the region is experiencing an explosion of viewership. The purchase comprises a strong local network across emerging markets in Southeast Asia (not only Malaysia) with a wide and compelling selection of video content such as TV shows, movies and local originals, to stream or download, on any Internet-connected device. Through the purchase, WeTV, will further extend our presence in the video streaming industry across Southeast Asia, to reach a broader audience base within the region and to better serve our users with better viewing experience.”

It should be noted that both China’s huge video streaming service, iQIYI IQ -2.1%and Netflix operate in Southeast Asia. Even more interesting are the rumors that Tencent was very recently looking to buy a large piece of iQIYI, which was originally spun out of Baidu BIDU -2.4% (the giant search engine of China) Baidu still owns a majority of iQIYI’s stock.

Malaysia is an important country, particularly in Southeast Asia. Malaysia is the 45th largest country in the world and has the 25th highest GDP. Overall population across Southeast Asia exceeds 650 million people. The countries in Southeast Asia are growing in Internet and smartphone penetration rapidly which is providing many business opportunities in the media and technology areas in that region.

None of the reports of the deal gave a value for the iflix transaction. Reportedly iflix was valued at $1 billion in 2019 when they were considering an IPO in Australia. Variety reported that the Tencent/iflix deal was only several tens of millions in US dollars which reflects the problems that iflix has been encountering in terms of financing and in terms of tough competition.

In real estate it is often said valuation is based on “location, location, location”, Tencent seems to believe that their continued spectacular success will be based on “video, video, video.”

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Disneyland Delays Date To Reopen

Posted on by Mike Vorhaus

Originally Posted on Forbes

Disneyland Resort in Anaheim, CA, the original Disney theme park, opened in 1955. It has been closed four times in its lifetime, – after the assassination of President John F. Kennedy in 1963, in 1994 Disneyland closed because of the big Northridge quake, after the 9/11 terrorist attacks, and most recently due to the Covid-19 pandemic.

Disneyland initially closed the park in Southern California on March 14 and had indicated that it would stay closed indefinitely at that time. Later Disney announced that the Disneyland Resort in Anaheim would reopen July 17.

Today The Walt Disney Company released a statement saying that it would delay announcing its reopening until sometime after July 4. The Disney statement said, in part, “The State of California has now indicated that it will not issue theme park reopening guidelines until sometime after July 4. Given the time required for us to bring thousands of cast members back to work and restart our business, we have no choice but to delay the reopening of our theme parks and resort hotels until we receive approval from government officials. Once we have a clearer understanding of when guidelines will be released, we expect to be able to communicate a reopening date.”

The Disneyland Resort theme parks will be the last Disney theme parks worldwide to reopen during this crisis, if Disney’s plans continue as stated. Tokyo Disney has announced its reopening for July 1, then the Walt Disney World DIS -1.9%‘s theme parks will open on July 11 and July 15. The Disneyland Paris parks are scheduled to reopen on July 15. The Shanghai Disney park reopened on May 11 to limited attendance.

The other Southern California theme parks – Universal Studios Hollywood, Six Flags Magic Mountain, Legoland California and SeaWorld San Diego – had requested to reopen at the beginning of July. Now everyone in the theme park industry, and the consumers who might be eager to see Mickey Mouse again, will have to wait for guidance to be issued by the relevant local and State governments.

Disney sought to assure future visitors to the Disney parks that they have, “developed enhanced health and safety protocolsfor both cast and guests at Shanghai Disney Resort, Hong Kong Disneyland Resort and Walt Disney World Resort that have been approved, allowing us to reopen in a responsible manner and bring our cast members back to work.”

Disney must complete negotiations with the various unions that represent Disney’s workers to reopen. As Disney said, “In order to reopen our theme parks we need to negotiate agreements with our unions to return employees to work. We have had positive discussions and are very pleased to have signed agreements from 20 union affiliates, including the Master Services Council, which represents more than 11,000 of our cast members. The signed agreement details plans that include enhanced safety protocols that will allow us to responsibly reopen, and get thousands of our cast members back to work.” 

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People Increasingly Turn To Social Media For News

Posted on by Mike Vorhaus

Originally Posted on Forbes

In these days of pandemic, protests, economic recession and angst among the world’s population a recently issued report shows that consumers continue to shift away from traditional media sources for their news and are moving more towards social media and messaging services to find the news.

Long gone are the days of people getting most of their news from a local TV station, their local newspaper or the national newscast from one of the networks. Over 15 years ago, we already saw the substantial decay of Americans using traditional news sources and instead the Internet becoming a major source of news, particularly for the 18 to 34 year old demographic. This data comes from a study done for Carnegie Corporation in 2005. A research group I led at the time was responsible for the study. Carnegie Corporation is a major U.S. charitable foundation with a significant interest in journalism and news.

As newspapers have fallen dramatically in usage, and the national newscasts have dropped in ratings, the swing to new sources of information has accelerated considerably. Reuters Institute for the Study of Journalism at Oxford University has recently issued a report on the state of digital news around the world.

One of the very notable facts coming out from the study is the heavy use of Instagram for news which could soon possibly overtake Twitter. Instagram news consumers were 11% of the social media population. Twitter was statistically tied at 12%. Just as we found in 2005 for Carnegie Corporation, the shift away from traditional news media sources is being led by the younger generation, in this case people under 25 years old. Two-thirds of that age cohort said they use Instagram for gathering news information. The same age group reported that they were two times more likely to look at news on social media apps.

Facebook leads with 36% of social media consumers using the social media giant for consuming news. YouTube had 21% of social media users looking at news on the popular video site. WhatsApp had 16% of consumers in that group and 12% used Twitter. Facebook owns both Instagram and WhatsApp.

In this time of political and social upheavals, it is interesting to note that the Reuters study (conducted by YouGov, a research agency) only found 14% of people in the US trusted news on social media compared to 22% in regard to news gathered from search engines. Also, as further evidence of the power of social media in driving news to consumers, social media as a news source, saw ongoing growth with news consumers, unlike platforms such as all online sources combined, TV, and print.

When thinking about what we know about the news and where we get our news, I reflect back on Will Rogers’ famous quote: “All I know is just what I read in the papers, and that’s an alibi for my ignorance.”

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Gaming Industry Sees Big Growth While People Stay Home

Posted on by Mike Vorhaus

As soon as people were ordered to stay home in response to the Covid-19 pandemic, consumers have had a number of ways to spend their added time at home—including play games. As the chart below shows, the increases in gaming revenue has been huge, month to month, since March. In March of this year, gaming, over March of 2019, is up 34% in spending. In April of this year, gaming was up 73% over last year, same month. And this past month, May, was up 53% over May of 2019.

“Video game engagement and revenue across all platforms, including console, PC, mobile, and VR, grew globally during the Covid-19 lockdown. Video gaming is considered an affordable and accessible form of entertainment, and existing and new gamers across all demographic groups found emotional and social support in these virtual worlds. The digital transition that began a decade ago through digital downloads, games-as-services, and mobile app stores has paid off for the industry,” said Michael Cai, president of Interpret, a global video game insights agency.

Stan Kwon, CEO of Beta Hat, a market and consumer insights agency specializing in gaming, media, and emerging technologies, confirmed the rise in gaming over the last few months. “Based on a recent survey we conducted among adult gamers in the U.S., almost 60% say that they’re spending more time playing games now than they were prior to stay-at-home orders going into effect.” Kwon also reported that he sees Americans “choosing to play a wider variety of games rather than sticking to the same games they were playing before” the stay-at-home order.

Further evidence of the rise in consumer engagement with gaming during this pandemic is that Unity Technologies, the real-time 3D software development platform company, has reported that mobile game ad revenue grew 59% during April 2020 compared to April the year earlier. Unity has also reported that in-app purchases in games rose 24% in March and April of this year.

There are many different types of games available to consumers on consoles, computers, and their smartphones. About 70% of the U.S. population at least occasionally plays some sort of video or mobile game. The breadth of games available to consumers are shown in this chart that looks at the most popular game titles over the years.

Rob Dyer, chief operating officer of Capcom in the U.S., spoke to the increase in gaming seen worldwide. “While we believe there has been an increase in the frequency of people playing games given the current restrictions on going outdoors, it is possible that less leisure time will be available in the future due to factors such as reduced summer vacation time.” Dyer went on to say, “We hope our games will continue to be a source of enjoyment for people everywhere facing these challenging times.”

While it is clear that consumer engagement with gaming has increased as people have had more time at home, but what will happen when the world goes “back to normal” and time at home goes down? Michael Pachter, research analyst at Wedbush Securities and a well-known expert in the field of gaming, points out, “It’s incumbent on the gaming companies to retain the new and lapsed players” down the road.