Multichannel News

Half of Viewers Use Connected Devices While Eyeing Sports TV

When it comes to watching sports on TV these days, it’s increasingly a second-screen and social play, according to a recent study from Sporting News Media.

According to the group’s “US: Know the Fan Report 2014,” nearly half of surveyed sports fans maintain that they use Internet-connected devices while watching games and events on television.

Forty-four percent of these second-screeners like to catch up on what’s happening with other games being played via live text commentary and live scores, while 38% access non-sports related content. Another 21% communicate with friends through a second-screen device about the sports event on TV, compared to 20% watching clips and highlights of other games being played and 14% posting comments to social networking platforms about the game/event they’re engaged with it.

According to Sporting News Media’s fourth study of its kind, 2014 has marked a significant increase in the number of fans following sports via social networking platforms as over one-third of respondents said they consume sports on these platforms. Social networking fans are primarily younger fans, with 65% in the 18-to-34 set.

While mobile consumption of sports content has doubled to 42% from 21% in 2011, 65% of the surveyed sports fans indicated that they still primarily use a computer/laptop to access online sports content. Almost two in five (38%) access content on these devices at least once daily, according to the survey. Sporting News Media’s research found that smartphones are more widely used (34%) than tablets (22%) for the second year running, with the former’s usage growing 10 percentage points since 2013, versus a 3-percentage point advance for the latter.

FCC Seeks To 'Refresh' Title II Docket

The Federal Communications Commission asked for input on former FCC Chairman Julius Genachowski's proposed "Third Way" approach to legally justifying open Internet rules that was part of the docket in the initial Open Internet order proceeding.

The 'Third Way' was short of straight reclassification, instead combining applying some Title II regulations and forbearing others. Comment deadlines are July 15 for initial comments and Sept 10 for replies.

Essentially the notice opens a new pleading cycle for comments on that 2010 "'third way' approach that would apply a limited set of Title II obligations to broadband providers," the FCC Wireline Competition Bureau said. "Today’s Public Notice establishes a comment cycle by which members of the public can update the record in that proceeding in light of marketplace and legal developments over the last four years."

Despite calls from cable operators, Genachowski declined to close the Title II docket after his decision not to reclassify, and FCC Chairman Tom Wheeler declined to close it in the run-up to his 706 proposal. Now Chairman Wheeler is affirmatively seeking more input on that 'Third Way' approach given changes in the marketplace and various legal developments since 2010.

FCC Likely To Release Auction Order Early Next Week

According to various sources, the Federal Communications Commission is not likely to release the final order on its incentive auction framework order until next week.

Broadcasters had been looking for the 400-plus page order to be released by May 30, 2014, but it is now looking like June 2 at the earliest.

The FCC voted on the order May 15, but it was a split 3-2 decision along party lines. Broadcasters will be going over the order with a fine-tooth comb. They are already contemplating taking the FCC to court over its decision to use new OET-69 data and/or methodology (there is a dispute between the FCC and NAB over which it is) to calculate TV station contours for the purposes of repacking after the auction.

In their dissents, both Republicans said the item was manipulating the market by limiting wireless bidders, was not necessarily holding broadcasters harmless in the band plan, and may not even be legal.

Prometheus Challenges FCC Ownership Rule Decision

Prometheus Radio Project is suing the Federal Communications Commission over its latest attempt at resolving a congressionally-mandated media ownership rule review, including challenging its decision to limit joint sales agreements (JSA's) as arbitrary and capricious.

Prometheus filed its challenge with the Third Circuit Court of Appeals, which remanded the FCC's old media ownership rules back to the commission after Prometheus challenged the FCC's initial efforts to loosen its ownership rules back in 2002. Prometheus is challenging the Wheeler FCC's decision to combine the 2010 and 2014 quadrennial reviews into a single review, which won't be completed until 2016. At the same time the commission voted -- in a split decision -- to limit JSA's.

Prometheus argues that the FCC was arbitrary and capricious in not addressing whether to attribute sharing agreements. And while the FCC did adopt the limit on JSA's, making those of over 15% of a stations weekly ad time attributable under ownership limits, it did not explain why 15% is the appropriate threshold for TV (as it already is for radio), which Prometheus argues is arbitrary and capricious, as was the FCC’s decision to attribute JSA's but not other types of sharing agreements, as was the case in the agency’s decision to not require disclosure of SSAs.

Set-Top Box Market ‘Ripe For Further Consolidation’: Analyst

As the proposed marriages of Comcast and Time Warner and AT&T and DirecTV move forward, this latest wave of consolidation is poised to have an effect on the telecommunications supplier market, creating a fresh batch of winners and losers.

That, of course, will extend to the realm of video gateways and set-top boxes, with at least one analyst believing that this new round of mergers and acquisitions will cause a shift in a market that is largely made up of Pace, Arris (thanks to its acquisition of Motorola Home in 2013), Cisco Systems, Technicolor and EchoStar.

“This mature, yet fragmented market, in which the top five vendors account for about 37% of the revenues, is ripe for further consolidation,” Sam Rosen, practice director at ABI Research, predicted, pointing out that Arris, with its focus on cable and IPTV, stayed ahead of Pace, which, in his estimation, is “over-weighted on satellite.”

AP, Others Protest Pay For Play D-Day

D-Day's 70th anniversary events may have reduced coverage by news agencies outside of France.

The Association Press says it and other news agencies (AFP, Reuters and ENEX) have protested the French president's office decision to grant exclusive rights to the main ceremony (June 6) to two French broadcast networks, which are now trying to charge global news outlets, cable channels and online outlets collectively over a quarter of a million dollars for access to that exclusive coverage.

June 6 marks the 70th anniversary of the Allies successful effort to storm the beaches of France under withering enemy fire, liberate the country from German occupation and turn the tide of World War II. "The French host broadcasters, France Televisions and TF1, are demanding that global news providers AP, AFP, Reuters and ENEX pay nearly 200,000 euros ($265,000) collectively for live broadcast and online streaming coverage of the official ceremonies, which feature at least 18 heads of state," AP reported.

Most Cord-Cutters Are Happy They Did It: Study

Although the cord-cutting trend remains small, consumers who have wielded the video shears are apparently happy with their decision.

About 84% of cord-cutters are “at least somewhat happy with their decision,” while 37% said they’re so happy that they have no plans to ever return to a traditional pay-TV service, nScreenMedia found in a new study that surveyed 1,000 US adults with broadband access. Of that same group, 8% said they were “pretty unhappy” with their cord-cutting decision, and 9% said they hated the decision and wished they had service again.

The report -- View My Video: Consumer Digital Media Consumption -- also found that 17% of US broadband subscribers surveyed say they once took a pay-TV service but have since left their provider, while 10% say they have never subscribed to pay-TV (the so-called “cord-nevers”), and 74% said they currently take a pay-TV service.

How Big Can Netflix Get?

As Netflix prepares to invade six more countries in Europe, Bernstein Research analyst Carlos Kirjner attempted to size up the streaming giant’s global opportunities in a report.

The “opportunity is more limited than many realize,” the analyst wrote, noting that infrastructure and affordability issues will limit Netflix in markets such as Latin America. But the forecast still seems to present some pretty big numbers.

“Assuming generously that Netflix deploys aggressively in 17 new countries over the next 2-3 years, we believe that by 2023 the number of broadband households in these markets with fixed connections capable of supporting SVOD will reach 243 [million],” Kirjner suggested. He also sees Netflix reaching about 65 million international subs, or roughly a 50% share of the research firm’s estimated international SVOD market, but only “if it deploys service very aggressively across all 17 incremental countries in our assumptions.”

That’s a sizable jump from where Netflix is today internationally, with 10.9 million subs. While 14% of that total comes from the UK and Ireland, and 25% from Canada, Netflix, to Kirjner’s earlier point, has only been able to scratch together about 1.5 million customers in Latin America (1% of total households), despite having launched there more than two and a half years ago.

AT&T: Dish Would Have Posed Regulatory Problems

AT&T chief financial officer John Stephens answered a question that has been on many investors’ minds in the past few days, saying that regulators would have had difficulty approving a deal for Dish.

Stephens said while DirecTV’s was still the carrier’s first choice, Dish’s spectrum would have made it more difficult to obtain regulatory approval. “Dish has been very loud about their intentions to get into broadband,” Stephens said. “From a regulatory perspective, bringing a company that either is or intends to be in broadband with another broadband company would be likely to raise additional regulatory scrutiny.”

Accelerated Lobbying: Bipartisan House Appeal to Reject Title II

Two new reports demonstrate the accelerating scale of Washington lobbying in connection with the Comcast/Time Warner Cable merger and with the Federal Communications Commission's network neutrality proceeding.

Comcast is currently registered with 40 firms, and it spent $5 million lobbying Congress during the first quarter of 2014, according to Senate reports as quoted in Politico, which calls Comcast's campaign "a K Street stimulus package." Among Comcast's recent lobbying recruits is Joseph Gibson, who once served as chief minority counsel for the House Judiciary Committee and also as chief of staff for Rep. Lamar Smith (R-Texas), a former chairman of that committee.

For its part, Time Warner Cable has spent $33 million so far in 2014, according to official records.

Separately, Maplight, a Berkeley (CA) organization that compiles data about campaign contributions, has identified 28 House of Representatives members -- including Speaker John Boehner (R-OH), Majority Leader Eric Cantor (R-VA) and Communications Subcommittee Chairman Greg Walden (R-OR) -- who have urged the FCC not to adopt a Title II reclassification of the Internet and who also have received well-above-average campaign contributions from the cable industry.

The 28 House members (eight Republicans and 20 Democrats) who signed one of three recent letters to FCC chairman Tom Wheeler have received an average of $26,832 in contributions from the cable industry, says Maplight. That sum is 2.3 times more money than the average for all members of the House of Representatives, $11,651, according to Maplight's research.

Overall, Republicans signing the letters to the FCC have received, on average, $59,812 from the cable industry, five times more than average contributions to House members; Democrats signing the letters received an average of $13,640 from the cable industry, 1.2 times more than the average, according to the Maplight analysis.

Maplight tallies 29 members of Congress who own stock in Comcast, making Comcast the 25th most held stock among members of Congress. Minority Leader Rep. Nancy Pelosi (D-CA) owns more Comcast stock than any other member.

According to Maplight's tally of campaign contributions "from cable interests" since 2012, the top recipients who signed the recent letters to Chairman Wheeler are Reps Walden (who received $109,250), Cantor ($80,800), Boehner ($75,450), Upton ($65,000) and Barrow ($60,500).

White: AT&T Deal Unlocks Potential

DirecTV CEO Mike White said his company’s pending merger with AT&T will unlock tremendous growth potential for the satellite giant, even as investors sent shares of both participants southward amid doubts about the benefits of the merger.

While the declines in shares were small, they are in sharp contrast to what usually happens to the seller in such mega-deals -- in contrast, Time Warner Cable stock was up 7% on the day it announced its $69 billion deal with Comcast -- and could point to concerns investors have about the deal outside of potential hurdles to regulatory approval.

White, who will continue to head up the DirecTV unit after the deal closes, said the merger offers the satellite giant an opportunity for growth. And while White and Stephenson wouldn’t mention it by name, it appears that the Comcast/Time Warner Cable merger -- which will create a 30-million-subcriber cable powerhouse -- influenced their decision to seek out a deal.

White also sees a big customer service opportunity in the deal, allowing DirecTV to offer more products in a single truck roll. “To me the real opportunity is growth,” White continued. “For us this is a real unlock, it unlocks our way to better serve rural areas, when you think about the 15 million [customer] build out of rural areas.”

Will An AT&T-DirecTV Merger Fly?

[Commentary] AT&T finally pulled the trigger on an acquisition of DirecTV. The merger creates a 26-million subscriber rival for the television business.

But as AT&T and DirecTV tout the benefits of the merger, analysts and observers are split as to the deal’s benefits. On the plus side, it could allow AT&T to free up bandwidth for its U-verse broadband service -- it currently allocates 15 Megabits per second for video and 10 Mbps for high-speed Internet service in about 25% of the country, and could give the telephone giant the incentive to upgrade its digital subscriber line plant (which maxes out at around 1.5 Mbps) to fiber.

Critics of the deal point to the merger as a temporary fix -- DirecTV’s video business is basically flat, adding just 12,000 net new customers in the first quarter -- and though the business is well run, operating DirecTV as a separate entity would require AT&T to support two cost structures in 25% of the country with just a one-product offering in the other 75%.

Here’s a look at some of the reasons for DirecTV to sit this one out.

  • The price could be too “frothy” or too pricey for what is at best a stable business.
  • The merger will solve AT&T’s cash problem, but only temporarily.
  • On the surface, it doesn’t look much better from a DirecTV perspective.
  • The broadband benefit to the deal is questionable.
  • AT&T gets a national video footprint in a slow-to-no growth business.

Comcast Has No Plans To Announce New Usage Policies

Clarifying comments made at the MoffettNathanson Media & Communications Summit in New York that some misinterpreted as a firm commitment that Comcast would implement usage-based policies across the board in five years, Comcast executive VP and chief diversity officer David Cohen said that’s not the case.

“To be clear, we have no plans to announce a new data usage policy,” Cohen wrote, pointing out that Comcast suspended its previous 250-Gigabyte-per-month excessive use policy in 2012. “Since then, we’ve had no data caps for any of our customers anywhere in the country.”

Comcast, however, is testing usage-based policies that link soft monthly caps with overage fees in a handful of markets, including Atlanta. In those tests, customers are fitted with a monthly limit of 300 GB per month before they are faced with a $10 charge for each additional bucket of 50 GB. Comcast is also testing a “Flexible-Data Option” that’s tailored to light Internet users.

Cisco Chairman Advises Against Title II

Cisco Chairman John Chambers has told Federal Communications Commission Chairman Tom Wheeler the company "strongly supports" his approach to reinstating open Internet rules.

"Your approach of applying a “commercially reasonable” test to new offerings by Internet service providers allows innovative new products and services to develop, while at the same time protecting consumers and competition," he said in a letter to the FCC chairman dated May 13. By contrast, he said, Cisco was "deeply troubled" by proposals to impose what he called "old fashioned telephone regulations of Title II" to broadband Internet access.

TiVo: Undecided On Comcast-TWC Deal

TiVo has not yet expressed a position on the proposed Comcast-Time Warner Cable merger, but the company gave Comcast high marks for its support for the CableCARD.

Among operators, “Comcast has been particularly cooperative in making CableCARD work for TiVo,” TiVo noted in an ex parte describing a meeting on May 8 between Tom Rogers, TiVo’s CEO and president, and Matthew Zinn, TiVo’s SVP, general counsel secretary and chief privacy officer, and Federal Communications Commission chairman Tom Wheeler, Chairman Wheeler’s special counsel for external affairs Gigi Sohn, and Maria Kirby, the chairman’s legal advisor.

The purpose of the meeting was to urge the Commission to grant TiVo’s July 2013 petition that seeks to reinstate the CableCARD rules that, TiVo claims, were “inadvertently vacated” by a DC court decision in which EchoStar won its challenge to FCC rules on the ability to record TV programming. During that same meeting, Rogers “noted that TiVo has not yet stated a position on the proposed Comcast-Time Warner merger,” according to the ex parte.

CableCARD Deployments Push Past 47M

The nation’s top nine incumbent cable operators have deployed more than 47 million operator-supplied set-tops with CableCARDs, the National Cable & Telecommunications Association told the Federal Communications Commission in a report filed on May 9.

That’s up from about 45 million when the NCTA filed its FCC report in late January. The number of CableCARDs deployed in leased devices continues to dwarf the number of modules used in devices with CableCARD slots sold at retail, including TiVo DVRs and a limited number of HDTV models.

In its latest report, the NCTA said the nine largest US MSOs have deployed over 616,000 CableCARDs for use in retail devices, just 10,000 more than the 606,000 reported in January.

The proposed bill or CableCARD provision in the Satellite Television Extension and Localism Act (STELA) action would clear cable operators to deploy devices with integrated security, though the cable industry has pledged to continue supporting retail CableCARD devices.

Ergen: ‘I Learned to Trust My Cards’

Dish Network chairman Charlie Ergen, reaching back into his ample sack of poker metaphors, said that he would prefer to sit back and watch the current merger frenzy in the media business play out, noting that as a former professional card player he “learned to trust my cards.”

Ergen said he didn’t have the firepower to outbid Sprint for T-Mobile or AT&T for DirecTV, citing two of the top rumored deals of the week, and would likely stick to the sidelines for the time being.

Dish, DirecTV Back STELA Compromise

Satellite companies Dish and DirecTV said they support a compromise struck by House Commerce Committee members on the Satellite Television Extension and Localism Act and urged swift passage.

The bipartisan bill, which is expected to pass in the upcoming markup, does a number of things, including at its heart renewing the compulsory license that allows those operators to deliver distant TV station signals to 1.5 million subs who don't get a local over-the-air version in their market.

Another major element is preventing coordinated retransmission consent negotiations by broadcasters.

ACA to Hill: Comcast/TWC Deal Threatens Competition

American Cable Association President Matthew Polka plans to tell the House Judiciary Committee that Comcast's proposed $69 billion merger with Time Warner Cable, and its proposed system spin-off/trade with Charter, will result in a multitude of anticompetitive harms and needs a bunch of fixes if it is to be approved.

Polka is among the witnesses at an oversight hearing on the deal on May 8.

"To put it mildly, the Comcast-TWC transaction is a “big deal” that threatens consumers and competition, likely resulting in higher prices for consumers," he says, according to his prepared testimony.

"As I will discuss, there is more than sufficient evidence already to demonstrate that the proposed transaction will result in significant anticompetitive harms in many ways. ACA is concerned about Comcast as both an MVPD -- the nation's largest --and as a programmer with regionals sports nets (RSNs), cable nets -- USA, Golf, Syfy, Bravo, E!, MSNBC -- as well as TWC as a cable operator with RSNs.

It argues that gives the deal both vertical and horizontal elements and creates potential harms from the combination of the two company's programming assets; from the combination of Comcast's programming assets with distribution assets from TWC and Charter; and from the combination of Comcast's distribution assets with those of TWC and Charter.

Comcast Going Big With Wi-Fi

Using a mix of quasi-public hotspots deployed in outdoor locations, businesses and on customer-side DOCSIS gateways, Comcast said its Wi-Fi network will span 8 million hotspots by the end of 2014.

Comcast, which announced it had surpassed the 1 million mark in early April, said it will be boosting that number throughout the year by deploying hotspots in several markets, including Atlanta, Baltimore, Boston, Chicago, Denver, Detroit, Hartford, Houston, Indianapolis, Miami, Minneapolis, Nashville, Philadelphia, Pittsburgh, Portland, Sacramento, Salt Lake City, San Francisco, Seattle, and Washington DC.

Usage is also on the rise. Comcast said nearly 200 million out-of-home sessions have been initiated on its Wi-Fi network so far in 2014, a 700% increase versus the same period in 2013.

Cable Operators Prepared To Enter Gigabit Era

In a wide-ranging discussion at The Cable Show, a handful of the cable’s top tech and engineering executives said technologies such as DOCSIS 3.1 position them well to offer Gigabit-level broadband services as they increasingly find themselves matched up with competitors such as Google Fiber and AT&T and the potential expansion of the telecommunication’s fiber-based “U-verse with GigaPower” platform.

Time Warner Cable, which is pairing off with Google Fiber in Kansas City, is wary of that competition, but has found that the new entrant has had limited success and that some customers are coming back because they like TWC’s video service better.

Google Fiber “is certainly a worthy competitor, if they’re going to overbuild us,” but that they offer “nothing dramatically different” than what TWC can bring to bear, Mike LaJoie, TWC’s executive vice president and chief technology and network operations officer, said. “Their product works. Our product works just as well.”

Cable’s incremental economics are generally better than someone who is entering the market in a greenfield situation and looking to cherry pick, Tony Werner, Comcast’s EVP and CTO, said, noting that Comcast has raised its speeds 13 times in the last 12 years and has begun to make 100 Mbps (downstream) its main flagship product in the Northeast and will look to continue that trend.

Powell: ‘Cable’ Doesn’t Quite Cut It

A Q&A with National Cable & Telecommunications Association President and CEO Michael Powell. He has said that the phrase “cable” in NCTA does not convey the “breadth of who we are and what we do.”

But Powell, a self-described “geek” and frustrated artist, recently told the story of how lawyers for the industry’s main trade association came to seek Patent and Trademark Office protection of a potential new moniker. Here’s a clue: He was clueless.

“There is an element of the cable brand I am troubled by,” he said. “I think it is incomplete. I think it has a certain meaning in the minds of consumers and a certain meaning in the minds of policymakers. And I think it underrepresents the breadth of what we are and what we do. We are not some old-fashioned cable industry. We are probably, now, the country’s most sophisticated full-service communications provider.”

Survey: Cord Cutters Clamor for TV/OTT Combos

If cable operators are eager to keep the budding cord-cutting trend in check, they’d be well served to offer an integrated, aggregated one-stop-shop that combines traditional TV services with fare delivered over-the-top, according to a new study from Amdocs.

About 76% of purported cord-cutters or consumers who had reduced the size of their video subscription -- sometimes referred to as “cord-shaving” -- said they would reconsider if they were offered a service that aggregates all video content, according to a survey of 750 consumers in North America commissioned by the customer care and billing specialist. Roughly 66% of all respondents said they would prefer this TV/OTT mix, while 40% said they would pay more for that kind of combination, Amdocs found.

Although cable operators have fared poorly in recent consumer studies, Amdocs said its survey found that multiple service operators (MSOs) outperformed OTT players in terms of customer service (92%), content (89%), and video quality (83%).

Can ‘Wi-Fi First’ Work?

Cable’s history with mobile services is full of stops, starts and outright disasters.

Now, many of the nation’s top cable operators have hitched their wagons to Wi-Fi, deploying hundreds of thousands of hotspots out on the HFC network coupled with roaming agreements, and an increasing use of in-home gateways as neighborhood hotspots.

Although Wi-Fi has traditionally been a fixed wireless technology, we’re already seeing evidence of next-gen Wi-Fi networks that can enable seamless handoffs between those hotspots, with Time Warner Cable taking the lead with its announced widespread deployment of Hotspot 2.0 technology.

As evidenced by Comcast’s TWC merger filing, Comcast has also been considering a so-called “Wi-Fi First” approach that would favor Wi-Fi over other connectivity options, namely cellular. But despite that important multiple service operator roaming partnership that remains limited to four card-carrying members (albeit large ones), Wi-Fi isn’t everywhere (yet), and there's still some doubt that it can offer mobility that is on par with cellular networks, so any notion of ubiquitous coverage still requires access to the cellular network. Cable doesn’t have one that it can call its own.