NAB, EMA Share Closed Caption Interests

Recognizing how much our industry is changing, the Entertainment Merchants Association (EMA) attended the National Association of Broadcasters (NAB) Show for the first time recently. In the past, the NAB Show would not have been of particular interest to us, given its focus on cameras, cranes, video editing software, and the other apparatuses necessary for television and radio broadcasters.

However, as broadcast television and online video converge and the lines between the two become less distinguishable, it has become clear we share common interests with our colleagues in the broadcast industry. Indeed, a number of EMA members exhibited at this year’s NAB Show, and many more attended.

In addition to visiting EMA members exhibiting at the NAB Show and co-hosting a reception for our attending members, EMA assembled a forum on closed captioning for online video.

Closed captioning is a good example of where the interests of broadcasters and the online video industry are converging. Broadcasters have for many years been required to caption their programming. In the past few years, the legal requirements for closed captioning have been extended to the online video industry, making online video more accessible to deaf and hard-of-hearing consumers.

Putting aside the legal requirements, closed captioning of online video just makes sense. Why would we as an industry not want to make our products as accessible to the widest possible audience? And captioning serves not only the deaf and hard-of-hearing community, but the larger audience as well. I must admit I find myself sometimes turning the captions on during programs produced in Great Britain. The accents in programs such as “Downton Abbey” can make it difficult for me to fully comprehend what is being said.

Our discussion about closed captions at the NAB Show — which included retailers, studios and captioning houses — revealed that captioning is not just simply putting the words on the screen. Some of the issues are technical, such as converting captions on legacy broadcast programming to formats that can display correctly on a variety of online platforms, ensuring proper positioning, and synchronizing the caption frame rate with the associated video frame rate.

Other issues are stylistic. I learned from the attendees at our forum that content providers and retailers have a variety of style guides they use that dictate things such as italicization, capitalization, fonts and colors. It’s a challenge to make sure that correct style is used for a particular title.
The forum attendees also discussed the emerging movement to provide audio descriptions of onscreen activity for the benefit of the blind and low-vision people. (Coincidentally, later that day Netflix announced its new initiative to add audio descriptions to select titles that it offers. I’m pleased to see the industry embracing this without a legal mandate.)

EMA has already done some work in trying to bring some consistency to captioning practices. We just released a document called “Best Practices for Closed Captioning of Internet Protocol-Delivered Video Programming in the United States.” Developed by a working group of retailers, with assistance from MovieLabs, the document identifies recommended options for caption files formats, describes how to communicate the frame rate used in the caption files, and explains how to meet the captioning legal requirement if closed captions are not provided.

The best practices document is available at .

Based on the suggestions at our forum, we will expand our efforts to provide greater consistency in closed captioning practices for online video. This will not only help remove inefficiencies and costs from the digital supply chain, but also hopefully make more programming accessible to the widest possible audience.

And we look forward to continue to attend the NAB Show to learn more about issues, like closed captioning, that are common to the broadcast and the online video industries.

United We Stand

Going it alone in the home entertainment business has never been a good idea. Back in the early days of home video, VHS triumphed over the far-better Betamax primarily because JVC, which designed VHS technology, was willing to license it to other manufacturers. Sony refused to share; only in the late 1980s did the company finally agree to license Betamax to other manufacturers, but by then it was too late: VHS had an overwhelming market share.

The home video market grew and prospered regardless of this disharmonious start, but I fear that’s something of an exception. The home video market gave consumers unprecedented control over their viewing choices, something they had never had before, and it grew rapidly largely because the proposition was so enticing and there was no real competition. Pay-per-view was still in its infancy, and the on-demand factor that really propelled home video’s fortunes was still a pipe dream.

Today’s home entertainment landscape is much more fragmented than it ever was. Consumers have all sorts of options for viewing movies, TV shows, and other programs on demand — when they want to watch it, where they want to watch it, how they want to watch it. And the proliferation of screens — remember, for years, the home TV was the only conduit to watch something, regardless of whether it was delivered on a cassette (and then disc), cable, satellite, or broadcast — has only intensified the competition even more.

The only constant, really, is this: The content owners, chiefly the studios, would much prefer consumers buy a copy of the movie or TV show rather than stream it (or, back in the day, rent it). It’s a clean, finite transaction — and a lot more profitable.

The studios have done a great job, driving ownership, through a series of innovations that focused on the two key factors driving consumer demand in this business:  easy and cheap. First came DVD, priced low out of the gate to encourage sales and, with random access, so much easier to watch than a videocassette (no need to rewind). Then came Blu-ray Disc, a qualitative improvement, followed by Digital HD.

Getting people accustomed to buying movies electronically rather than in physical form was made all the more challenging by the emergence of low-cost streaming services like Netflix and Amazon Prime. And yet it can be argued that the ease of streaming has opened up consumer eyes to the wonderful world of digital distribution — and through incentives like early windowing and saving hot new releases for purchase it’s only a matter of time before the studios establish a viable sellthrough business.

UltraViolet only makes the value proposition all the more enticing. The concept of a digital “locker” where your purchased content lives on forever, and may be accessed at any time, on any device, is a sweet proposition. It eases the transition from disc to download, and at the same time acts as a safety net. Even if you lose or break the disc, or your hard drive crashes and takes down your movie library with it, the content you bought is yours forever.

If there’s one fly in the proverbial ointment, it is this: While all the major studios and many independents are part of the UltraViolet consortium, Walt Disney Studios is conspicuously absent, insisting on going it alone with Disney Movies Anywhere, a proprietary alternative to UltraViolet.

That needs to change. Now, more than ever before, is the time to be a team player — to stand united as the industry transitions from packaged media into the digital space, with a viable purchase proposition to counter the proliferation of streaming options.

Disney Movies Anywhere is certainly a great technology, but it’s only one studio. UltraViolet could be the home entertainment industry’s Balm of Gilead, but it needs universal support.

Why not figure out a way to merge the systems?

Have we forgotten that old statement, united we stand?

Box Office Glow Might Rub Off

If there is an equivalent of a crystal ball for home entertainment, it is the box office take of films in the pipeline. When theaters have more hits, typically studios and retailers sell and rent more home entertainment product.

At the annual CinemaCon trade show in Las Vegas, John Fithian, president and CEO of the National Association of Theatre Owners, offered an optimistic view for 2015. He predicted a record-breaking year for the industry in part based on the quality, genre breadth and expert timing of releases. He also gave a shout-out to the industry’s greater appeal to women moviegoers, citing such films as Fifty Shades of Grey, Cinderella and Insurgent. He said there would be several movies topping $1 billion in box office worldwide. The hits include Furious 7 (already raking in the dough) and the anticipated “Avengers” and “Jurassic Park” sequels as well as the “Minions” spinoff. Of course, the “Star Wars” sequel is a potential blockbuster of galactic proportions.

This is welcome news after a bit of a drought in box office power. As California has thirsted for more rain, so too have the studios suffered a drought in hits. Soon it will be the home entertainment industry’s turn to reap that expected record harvest. But this time there are many more digital competitors in the home entertainment realm that will take a bite out of the crop, putting more pressure on the traditional home entertainment business. If you have a team of all stars and still can’t bring in the trophy, pundits turn to the management to blame.

It is the home entertainment industry’s job to extract as much bounty from this wealth of hits as it can. The pressure is on. New releases have made up an ever-increasing segment of the top 50 sellers on the VideoScan charts. When the new releases are stellar, it makes sense that the home entertainment business will profit. Theaters are throwing the home entertainment industry a soft ball, and the industry needs to hit it out of the park.

Technical Issues Continue to Affect Sling TV

To some Sling TV subscribers, streaming the April 12 premiere of “Game of Thrones” via Roku was an exercise in frustration. Not unlike the men’s college basketball Final Four April 6 when technical snafus undermined streaming Duke vs. Michigan State and Wisconsin vs. Kentucky.

Sling TV CEO Roger Lynch again took to social media, first giving a shout out to the IT department for delivering a “great experience” to the “vast majority of our customers.” He also acknowledged ongoing technical issues.

“We heard of (and experienced for ourselves) some Roku devices taking too long to load our app. Our teams are actively addressing this issue,” Lynch said.

The executive said improvements were made to a variety of core systems — from account creation to service delivery. Sling also enhanced its app across all platforms, which helped in load management and delivered new features, like parental controls, according to Lynch.

None of that mattered to me the morning of April 13 when a frozen TV screen image of Republican presidential candidate Marco Rubio on CNN confirmed all was not well between Sling TV and Roku.

A Sling rep reaffirmed the Roku issues, which prompted a call to the latter’s customer service and the following voice message: “You’re estimated wait time is less than 20 minutes. We apologize for the delay.”

Luckily, in half that time I was connected to a technical rep located in India. She told me to unplug and plug-in (after 30 seconds) my Netgear wireless router. Then I was prompted to reload the Sling TV app. The technical issues continued.

I was put back on hold with Muzak. When the rep returned, she told me to push the home button on the Roku remote five times, followed by the rewind key three times and fast-forward button twice. That brought me to a screen allowing me to override the default streaming speed.

Following the prompts back to the home page, I clicked on the Sling TV link and back to CNN. The tech rep said she would wait to make sure the streams worked. They did long enough to be informed my case file would be kept open for future reference.

I was also told that my 90 days of free customer service had expired. Should I call technical support again, I would be charged a $9.99 fee.

A few minutes later my TV screen froze again. I switched to Pandora without any issues. I think I’ll watch a DVD next.

 

 

Is Sling TV Ready for Primetime?

As Wisconsin and Duke April 6 met to decide college basketball’s No. 1 men’s team, the Final Four competition April 4 featuring Duke vs. Michigan State and Kentucky vs. Wisconsin proved to be a bit of a streaming challenge on Sling TV.

As a subscriber to Sling, Dish Network’s upstart over-the top video service, I relished the chance to watch online as TNT and TBS streamed most of the 64 games of March Madness.

Apparently, I wasn’t alone. The live video streams were repeatedly compromised by buffering, pauses, pixilation and aggravating “error” messages.

The experience underscored OTT video’s Achilles heel, namely that the technology is not yet prepared to handle excessive demand for programming — unlike traditional linear TV. 

While the Duke/Michigan State contest wasn’t really in doubt, Wisconsin playing down to the wire and beating undefeated Kentucky was a different story. And Sling wasn’t prepared.

“We're sorry some basketball fans saw errors tonight due to extreme sign-ups and streaming. Engineers rebalanced load across network partners,” Sling tweeted April 4.

To be fair, HBO Go experienced similar technology glitches during the March 9, 2014, finale of dark thriller “True Detective.”

And it wasn’t the first time I’d experienced problems with Sling — the first OTT service to offer ESPN and HBO without mandatory pay-TV subscriptions. On several occasions, the TV screen has gone blank with Sling posting the “error” message, or my favorite: “Oops, we’re working on it.”

A call to Sling’s tech support resolved the issue by having me delete and reinstall the Sling app on my Roku device. But even that remedy didn’t work Saturday night as Wisconsin pulled off one of the greatest upsets in NCAA history -- key moments of which I missed.

To ensure no repeat during Duke's impressive comeback win against the Badgers and fifth NCAA championship, I watched Monday night's game at a friend's house -- on linear TV.

 

 

Talent in Charge?

A group of top recording artists, led by rapper Jay Z, wants to make streaming pay talent more. They’ve launched a new music streaming service — Tidal — designed to offer artists better pay for their work.

The service starts at $10 monthly and is designed to take on the likes of Spotify and Pandora by offering better-quality audio and better remuneration for artists. Such luminaries as Beyonce, Kanye West and Madonna were on hand for the announcement.

This isn’t the first time a big-name music star has called out cheap (or free) streaming services for underpaying artists. Singer Taylor Swift, fresh off the launch of her blockbuster album 1989, pulled her catalog from subscription streaming service Spotify, saying artists and their labels aren’t paid enough for the many times listeners stream their songs on the free version of the service.

“Valuable things should be paid for. It’s my opinion that music should not be free, and my prediction is that individual artists and their labels will someday decide what an album’s price point is,” she wrote in a column in The Wall Street Journal.

It seems Tidal may be one step in that direction, as far as artists are concerned. Artist Alicia Keys, at the press conference in New York, said Tidal will “preserve the value of music,” according to the Los Angeles Times, and will offer exclusive content not found anywhere else. Sound familiar? Tidal has no free service; it’s $9.99 monthly for basic service, with standard streaming of music and high-definition music videos, and $19.99 monthly for CD-quality streaming, HD videos and access to original content.

But in the Internet realm, who really is in charge? Is it the content producers or the technology companies that deliver content? It’s a question that has not only plagued the music business, but also the entertainment business at large.

Will Tidal’s quality streaming, offering better compensation to talent, convince consumers to pay more (or, really, pay anything at all)? That’s an open question. I, for one, hope it will, and probably so do the many movie and TV show producers out there that find they don’t get enough of the bounty from the Internet revolution. But it’s not the top stars that are really in danger. It’s the upcoming talent that is taking the biggest long-term hit for low-cost streaming. I hope Tidal finds a way to include them, too.

Smartphone Viewing

A byproduct of the growing popularity of OTT is that consumers are judging their wireless carriers not by how cheap the service is, but by how smooth the streaming experience is.

I found that little pearl of information in a recent Ciena-sponsored study conducted by ACG Research, which predicts average bandwidth consumption per mobile user is expected to go up 52% over the next three years.

That sharp uptick in consumption is being fueled both by increasing smartphone penetration, which ACG believes will rise from 55% by 67% by 2018, as well as the growing trend among consumers to watch filmed content over their phones. ACG believes OTT use on smartphones will account for 59% of the predicted bandwidth consumption increase.

At first I questioned the validity of the study, picturing my almost nightly routine these past two months of watching a “Game of Thrones” episode, on Blu-ray, in my family room, on my trusty Panasonic plasma.

But then I caught myself watching a YouTube video during a particularly long red light, and even a half hour episode of a silly old 1960s sitcom while waiting at the doctor’s office for my annual physical.

And I figured if a home theater purist like me would stoop to watching stuff on a tiny smartphone screen simply because it is so cheap and so easy, then this truly must be the wave of the future. Just like home video flourished in the first place because we didn’t want to be tied down by the networks telling us what we can watch, and at what time, OTT and smartphones, together, have unleashed us from every conceivable restraint. And as more, and better, programming becomes available with the proliferation of OTT, so will our freedom increase.

The challenge for carriers, of course, will be to increase bandwidth accordingly. According to the ACG study, supporting backhaul capacity requirements will exceed 1 Gbps by 2018, “and this will be further intensified by the latest wireless standards such as LTE-Advanced and the introduction of more small cells, which are expected to deliver faster wireless services with broader coverage to users. Service providers need to take steps to deploy a mobile backhaul solution that supports 10 Gbps to meet this projected bandwidth and ensure quality of experience.”

As ACG research analyst Michael Kennedy noted in the Ciena press release, “Now more than ever, the quality of experience for the latest OTT applications is paramount and a key driver of customer loyalty. In three short years, these networks must offer broader coverage and handle more people using more applications on more devices at the same time. As a result, the backhaul infrastructure must transform to enable a more dynamic experience."

 

Rental Market Is Boxed In

It wasn’t so long ago that the top dog in the video rental business was Blockbuster Video. Blockbuster executives crafted the rental deals that the rest of the industry emulated or worked around. Now that mantle seems to have passed to Redbox, the kiosk company that was characterized as an upstart not so many years ago.

I remember a spokesperson for a major public video store chain telling me that the kiosk market was just a marginal business that would never overtake stores. He said, “How could they possibly replace video store clerks?” Another such spokesperson said online physical rental (Netflix) was a side business, never to rival the store experience. (Now, by the way, Netflix executives think disc rental is a side business, too.)

Those public video store rental chains are long gone — and still standing is Redbox. Following the stores’ demise, Redbox is the dominant outlet at which consumers rent a physical disc. Netflix has sidelined its physical disc rental business in favor of streaming and original programming for streaming, and independent or mid-level chain video rental stores are few and far between.

Pretty much every time I go to a grocery store in my neighborhood, I see a Redbox kiosk with a customer or two. For most consumers who want to rent a physical disc, Redbox is the easiest, cheapest and quickest way to view content, especially movies. Just before Blockbuster went bust in late 2013, Home Media Magazine editors fanned out to find the closest rental outlets and Redbox kiosks were by far the most convenient. I personally had to get on a freeway and travel a half hour to find the nearest Blockbuster or indie rental store. The writing was on the wall.

After the demise of many video stores, Redbox has become important to content owners as well. The studios look to Redbox to buy and rent all of their new releases (popular or not) under output deals. Independent content owners look to Redbox to pick up art house or genre titles that used to find a place in a larger video store rental market, but that the mass merchants increasingly won’t sell.

“Everybody is taking them to lunch,” one industry observer told me of Redbox. Until some other market (perhaps digital) eats their lunch, Redbox looks to be on a roll.

$2 Billion Cure for 'Netflix Fatigue'?

It’s interesting to note that Netflix is now spending more money on content than HBO, BBC and Discovery. The subscription streaming behemoth, which began life as a DVD-by-mail rental service, spent more than $2 billion on content in 2014, about 20% of which went to original programming such as its hit series “House of Cards” and “Orange Is the New Black.”

That’s a huge expense for a company that charges its customers less than $10 a month for unlimited access to all this content, but with international expansion high on its agenda Netflix seems bent on making a splash in whichever new markets it enters, at the same time casting a wary eye over its shoulders at U.S. consumers and hoping and praying they don’t come down with “Netflix fatigue,” particularly now that Amazon Prime is nipping at its heels.

This huge spend has shaken up Hollywood to the point where studios and independent content producers are seeing Netflix as a lucrative new revenue source that at least for now far eclipses what they can make from this content from traditional channels, be they foreign TV rights or good old DVD and Blu-ray Disc.

Is it sustainable? That’s a good question. Nothing, in business, ever really lasts forever, but then lengths of successful runs vary wildly. MySpace was huge, but was rather swiftly banished to the social media graveyard by Facebook, which has remained on top largely because of its popularity not so much with fickle teens as with older demographics, particularly moms, with an ingrained sense of brand loyalty. The Apple iPhone and iPad remain the Cadillacs of mobility, status symbols both because of their sleek look and incredible craftsmanship.

Netflix has an amazing amount of product, but the lack of first-run movies and spotty record regarding TV shows — you can watch “Breaking Bad” but not “Game of Thrones” — is a definite weakness; hence, the drive toward original content.

But if there’s a word of caution I could throw out here, it’s that if you’re No. 1, everyone and his brother are going to want to unseat you. Amazon Prime is just one of a growing legion of competitors, big and small, broad and niche, hungry for a bite of the Netflix-dominated OTT pie. And while Netflix is smart to look overseas to further expand its reach — in January the company, currently in 50 countries, said it wants to be in 200 by the end of 2016 — the growth potential is not unlimited.

For Netflix, to paraphrase Charles Dickens, these truly are the best of times, and the worst of times. About all Netflix can do is continue to pay big bucks to feed the beast —realizing the beast is growing hungrier all the time and hoping it won’t one day turn on its master.

Gathering Clouds

Are gathering clouds raining on studios’ digital sales?

It seems Warner CEO Kevin Tsujihara thinks that might be the case. Different studio-backed cloud-based content ownership services are confusing consumers and slowing digital growth, he said.

Since the introduction of UltraViolet, supported by most major studios, Disney has been a holdout, preferring to support its own subsequently introduced cloud-based service, Disney Movies Anywhere, rather than join the UV accumulation. Various industry observers have debated the merits of Disney’s different path, but many came to the conclusion that both clouds could coexist nicely without damaging digital growth on the horizon.

Tsujihara appears to disagree.

“It would be my goal to bridge [UltraViolet] with what Disney is doing, so the consumer doesn’t have to guess is that a Disney movie, or is that a Fox, Sony, Paramount, Universal or Warner Bros. movie?” Tsujihara said March 4 at the Morgan Stanley Technology, Media & Telecom confab in San Francisco. He noted that while digital sales of movies increased 50% in 2013, growth slowed to 30% in 2014 and is about the same so far this year, which will not be strong enough to offset declining disc sales.

While two cloud services can coexist — indeed they do — it seems to me that they need to be connected through consistent marketing and operational logistics, making access to both seamless to the consumer. Consumers want simple services, and they really don’t care (or often even recall) which studio owned the content they want to acquire. Format options can stimulate, rather than kill, a market. But sometimes, as with the many TV versions of 3D, they scramble the message so much that consumers begin to boycott the market altogether.

“We have to focus on what the consumer is looking for: Simplicity. The magical thing about DVD was it was simple, easy and worked everywhere. I think we have to replicate that in EST,” Tsujihara said.

Making that sort of simplicity work for non-physical ownership is one of the key challenges facing studios, no matter which cloud they follow.