With headlines from the media/tech landscape flooding your inboxes daily, the VIP+ team is here to distill the biggest of them each week and make a case for why it matters. Below, our incisive analysts pick the one development that heated up their week.
Gavin Bridge, Senior Media Analyst
NBCUniversal streaming service Peacock announced this week its English-language coverage of the upcoming Tokyo Olympics. While NBCU’s TV networks will continue their extensive coverage of the summer event, this Peacock strategy has some interesting points.
First, the obvious point: NBCU was never going to put the entire Olympics on Peacock for free and further erode the shrinking value seen in cable TV. Most live sports, such as soccer, swimming, tennis and golf, remain exclusive to USA Network, CNBC, NBCSN, Olympic Channel and Golf Channel.
Where it gets interesting is that Peacock will be showing live track and field for free, which is only available for TV viewers via cable subscription on USA Network. Audience-favorite gymnastics will also air live on Peacock for free.
In case you’re wondering which TV network airs live gymnastics, it’s not currently known, as the schedule for that event has yet to be finalized by the IOC. And NBCU is putting one big Olympics draw behind the Peacock paywall: U.S. Men’s Team Basketball.
This blend of free and paid events is a smart strategy: Some of the most attractive events are free and will be able to draw an audience to see Peacock promoting its service in the ad breaks, but it’s not enough to entice people to cancel their cable service to watch the Olympics.
Likewise, the idea of making extended highlights and full game replays for other sports available via Peacock is a smart move to bring in more users. While not every Olympics viewer will stick around, the free live content and Kevin Hart/Snoop Dogg recap show should yield a bump in Peacock’s frequent user base and hopefully give the company some confidence to begin reporting monthly average users like their streaming brethren.
It would also be remiss not to briefly point out that Peacock this week finally added Amazon Fire TVs and devices to the list of services that carry it — just in time for the Olympics and now joining the major streamers in being carried across all the main connected-TV and device operators in the U.S.
Heidi Chung, Media Analyst/Correspondent
After much anticipation, it’s finally happening. Buzzfeed will be hitting the public markets via a merger with a special purpose acquisition company (SPAC) called 890 Fifth Avenue Partners. Once the deal closes, Buzzfeed would have an implied value of approximately $1.5 billion. On top of that, as a part of the deal Buzzfeed will acquire Complex Networks for $300 million.
In a public letter following the formal announcement, Buzzfeed founder and CEO Jonah Peretti outlined three key focuses for the company moving forward. First on the list was to consolidate digital media. Basically, Buzzfeed wants to snatch up small, struggling digital media companies with the additional capital it raises by being a public company.
Keep in mind, it’s only been about seven months since the company bought HuffPost from Verizon. It was a strong start for Buzzfeed back in the 2000s, but things have started to cool off in recent years. That’s where this SPAC stuff comes into play. The company needs additional acquisitions like Complex to achieve greater scale and eventually return to growth.
It’s no secret that the media landscape is challenging for smaller companies competing for digital ad dollars with Big Tech giants such as Facebook and Google. However, whether Buzzfeed’s ambitions play out as planned after becoming a public company remain to be seen.
Kevin Tran, Media Analyst
YouTube’s pitch to TV advertisers is getting stronger. That’s suggested by The Information, which on Wednesday reported roughly 40% of YouTube ads in the U.S. are now watched on TVs, up from 12% two years ago.
Increased viewership of YouTube ads on TVs is something YouTube has long hinted was occurring. Viewership of YouTube on TVs increased by 39% between July 2018 and March 2019, YouTube said in 2019. A year earlier, it started letting brands target viewers directly on TVs, and 2018 is also when Debbie Weinstein, VP of YouTube/Video Global Solutions, said, “TV is the fastest-growing surface for YouTube viewership.”
What’s interesting about YouTube’s TV ad-viewership growth is it’s occurred even after brand safety issues arose and premium ad-supported video streaming options expanded. Peacock launched nationwide last summer, and The Information has previously suggested most users don’t use the ad-free tier of that service. Discovery+ launched earlier this year with an ad-supported tier.
More than anything, YouTube’s growth despite the challenges that have arisen speaks to its sheer scale: As early as 2015, more than 400 hours of content were uploaded to YouTube every minute. The sheer tonnage of new content that constantly hits YouTube helps explain why many haven’t ditched it over the years.
Kaare Eriksen, Information Editor
As AT&T works to pay down its inherited debt load from WarnerMedia, which is awaiting the approval of a planned merger with Discovery in 2022, it has decided to sell Playdemic, the development studio behind mobile game “Golf Clash,” to major video game publisher Electronic Arts for $1.4 billion.
Originally acquired by Warner Bros. Games label TT Games to develop mobile titles based around the Lego brand, Playdemic instead shifted to “Golf Clash,” which quickly found popularity. But as Warner Bros. Games is principally focused on WarnerMedia IP, Playdemic clearly became an odd fit, so the studio’s sale to EA makes far more sense as game publishers look to capitalize on the mobile sector.
Activision Blizzard, a major rival of EA that controls hit franchises including “Call of Duty” and “World of Warcraft,” also owns King, the publisher behind mega-popular mobile game “Candy Crush.” King has consistently brought in above $500 million in quarterly revenue, per earnings reports.
Through Playdemic, EA will be able to better balance its earnings alongside its other successful brands like EA Sports rather than continue to rely on boosted earnings from the general gaming craze resulting from the coronavirus pandemic. As live services remain the best way to ensure consistent and dependable revenue streams, seizing on the success of mobile remains a viable strategy for publishers.