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With more media companies creating TV-like video content for platforms with big content budgets, the over-the-top video market is exploding with new places to watch video. Subscription and ad-funded video-on-demand services have healthy revenue prospects, but media companies struggle to get their video seen in a cluttered landscape. Here are four charts on the state of the OTT market.

Netflix dwarfs a crowded market
In the last year, social media companies have joined mass-market platforms like Netflix and legacy cable players like Sky and HBO in the OTT ecosystem. But platforms that invest in quality content have the edge in acquiring viewers, and here Netflix is still king when it comes to annual budgets. For publishers with video ambitions, Netflix’s $8 billion (£5.7 billion) content budget for 2018 is enticing.

Netflix and Amazon both far outstrip free-to-air broadcasters such as the BBC and ITV in the U.K. and CBS in the U.S., as well as pay-TV players like Sky and HBO, according to a recent report from Juniper Research. Additionally, Facebook has indicated it will pay providers up to $3 million (£2.1 million) per 30-minute episode for premium content for Watch, while Apple will add at least 10 new original series in the coming year.

Outside of original programming budgets, rumors have circulated for months about Amazon and Facebook bidding on Premier League rights packages, but Amazon is a more likely contender than the social platform for now. Sky and BT have already paid a combined $6.3 billion (£4.5 billion) for rights to show five of the seven international rights packages. “Facebook has never shied away from spending money when it sees the strategic importance,” said Joe Weston, director at We Are Social Sport. “Ultimately, it comes down to timing, and I don’t think the social platforms are ready.”

Netflix has a France problem
Netflix isn’t taking hold in all countries. France has the lowest uptake of subscription video-on-demand services out of 14 countries surveyed by media analyst firm Ampere Analysis, despite the country’s record of having one of the highest uptakes of paid TV.

French internet users are more than twice as likely to prefer pay TV over subscription video on demand. For comparison, in the U.S., 72 percent have subscription video-on-demand services and 71 percent have pay TV, while in the U.K., 67 percent have pay TV and 58 percent subscribe to a video-on-demand service. Netflix is still the most popular subscription video-on-demand service in France, ahead of Amazon, CanalPlay and SFR Play. Subscription video-on-demand services are more popular with younger viewers, though, with 61 percent of French 18- to 24-year-olds subscribing to one.

Reasons for pay TV’s hold in France are stricter local regulations demanding higher quotas of French content, aggressive rollout of advanced connected set-top boxes by French TV operators and demand for local-language content rather than English-language content, according to Richard Broughton, director at Ampere Analysis.

OTT revenues will reach half of pay-TV revenue by 2022
OTT revenues, which include ad-led video on demand, pay-per-view and subscription video on demand, will grow from $37 billion (£26.4 billion) in 2016 to reach $83.4 billion (£59.6 billion) in five years’ time, bringing the total TV and video market to $283 billion (£202.2 billion) by 2022, according to a Digital TV Research report.

Pay-TV revenues will fall over the same period, though the decline will be small. While subscriptions are the most stable future for monetizing OTT, they still have a way to go before beating OTT ad revenues.

Audience reach and discoverability are the toughest challenges
For publishers looking to create OTT content, the three biggest challenges are building new and loyal audiences, discoverability of content and monetization, according to Digiday research. Despite healthy funding from the main players, the competition for eyeballs is fierce: The U.S. alone has over 200 OTT providers, and audiences, which might be fickle, are also only happy to pay for a limited number of services.

The post The evolution of streaming video services, in 4 charts appeared first on Digiday.

Welcome to the new Digiday Video Briefing, a new weekly newsletter from Digiday senior reporter Sahil Patel that will take you behind the scenes of an industry in upheaval. To get this in your inbox, sign up here.

It’s safe to say “Ball in the Family,” a show starring famous basketball dad LaVar Ball, is the first hit show on Facebook Watch — it’s certainly the first Watch show that people outside of the media business recognize. And Facebook is spending good money for the exclusive rights to the show, which is produced by Bunim/Murray Productions. Multiple sources have told me Facebook is paying somewhere between $550,000 and $750,000 per episode. That’s cable TV money.

But that doesn’t mean Watch is a TV network of the future — mostly because that ignores the fact that Facebook doesn’t want to be a TV network. Don’t forget, Watch is a product test to get people to spend more time on Facebook — this time, with professionally produced video shows.

It’s been thrown around that Facebook wants its own “House of Cards” or “Scandal.” And Facebook’s pursuit of entertainment content has certainly piqued the interest of Hollywood:

“Facebook just bought a series that’s roughly in the $30,000 to $40,000 per minute range, with an exceptional piece of talent.” — Longtime film and TV studio executive

But as multiple talent agents and studio execs have recently told me, most sellers aren’t taking their best ideas to Facebook. Watch needs to make a serious dent with viewers because ultimately, the big stars that Facebook clearly wants for its shows care about whether their shows are actually seen.

What’s forgotten in all of this is that Facebook has given no indication that it wants to be a TV programmer in the style of Netflix or HBO. Yes, it has the money to buy its own “Scandal” — and it might. I just keep coming back to what Facebook CFO David Wehner said during an earnings call a year ago: Eventually, Facebook wants to fund Watch by sharing ad revenue, instead of subsidizing productions upfront. That doesn’t sound like a TV network to me.

Confessional

“NewFronts are simply not a viable marketplace for buying video-based programming. We did not see the return on creating incremental, built-if-sold programming for one week where no transactions take place. The event has really turned into a branding moment, and we have a bunch of those throughout the year.” — Former NewFronts presenter on why his company is sitting out this year

Numbers don’t lie
$100 million: How much Snap paid out to its Discover content partners in 2017. (Keep in mind that Snapchat has over 90 partners globally.)

5 million: Number of subscribers for HBO Now, up from 2 million just a year ago. Sometimes it pays to be early.

What we’ve covered

Publishers with TV ambitions are pursuing Netflix:

• Netflix has an $8 billion content budget for 2018.
• Publishers are fine with becoming “producers for hire” to make shows.

Read more about publishers and Netflix here.

YouTube Red is having an identity crisis:

• YouTube’s CEO and creators can’t agree on what YouTube Red is.
• YouTube Red is spending on TV shows with cable-level budgets.

Read more about the state of YouTube Red here.

What we’re reading
Facebook is killing comedy: This Splitsider interview with comedian and former Onion writer Matt Klinman is going to hit close to home for many of you. It’s about how Facebook has made it nearly impossible to make money off of making internet content. Sound familiar?

Hulu lost $920 million in 2017: Hulu has 17 million paying subscribers and maybe the most sought-after ad inventory on the internet, yet it’s not turning a profit. Why? Netflix. Hulu previously said it would spend $2.5 billion last year on content. (Netflix, which has 55 million subscribers in the U.S. alone, spent $6 billion in 2017.) This is the world major video companies and platforms live in now. At least Hulu’s beating Netflix at the Emmys.

The lights are dimming on Go90: Verizon’s mobile video app Go90 is being folded into Oath, according to Oath CEO Tim Armstrong’s comments during a Recode conference. When asked whether the Go90 brand will stick around, Armstrong said, “The brand will remain — I don’t know how long for.” Pour one out.

The post Video Briefing: Facebook Watch is not a TV network of the future appeared first on Digiday.

T Magazine, the fashion and style publication of The New York Times, is revamping both its design and editorial strategy to better resonate with an evolving demographic of readers and advertisers.

The aesthetic updates — which rolled out digitally on February 7 and will debut in Sunday’s print issue on February 18 — are intended to reflect a “newsier” tone that is more visually congruous to the rest of the paper, according to Hanya Yanagihara, editor-in-chief of T Magazine. Yanagihara, who returned to T in April 2017 after previously working as the magazine’s deputy editor in 2016, said the new look is intended to better encapsulate the magazine’s shifting voice as it increasingly explores the intrinsic link between art and culture in today’s political climate.

“It captures the urgency of the time and the moment,” she said. “Fashion, art, culture, design — all of these respond to what’s happening in the moment. We wanted to reflect that urgency — on the runway or in the way people are creating art and connecting politically — and for the magazine to have a slightly harder edge and feel.”

Yanagihara — who also previously served as an editor at Condé Nast Traveler and won the Man Booker Prize for fiction in 2015 — is also particularly focused on expanding T’s global approach to coverage. From a regional respective, this means identifying trends that transcend the traditional epicenters of style including New York, London, Paris and Milan. An upcoming feature focuses on the rise of small Belgian-owned hotels popping up across Iran.

“The magazine has always been at its best in the moments when it’s responding to politics or war or discourse in the world, and explaining why it’s happening and what it means,” she said. “That doesn’t mean there aren’t simply things in the magazine that are beautiful for the sake of being beautiful. I would argue there is more of a need for that now.”

As an Asian-American woman, Yanagihara has also ushered in a more inclusive approach to coverage, including this Sunday’s cover story on popular feminist artist, Judy Chicago. And she cited a piece that ran online this week on classic portrait painting, tied to the unveiling of Michelle and Barack Obama’s presidential portraits. Beyond serving as an examination of the intricacies of portraiture as an art form, it grapples with racial disparities in painting, given that, historically, such depictions of individuals in power have been overwhelmingly white.

“In an era in which the very idea of truth is so fraught and fungible, there’s something reassuring about art returning to things that refer to what they’re supposed to. In representation, there’s a sense of clarity and truth,” she said.

T Magazine will also amp up its video content in the coming months, increasing the frequency of popular video series like “Read T a Poem” and “Tell T a Joke,” short clips of celebrities reading famous poetry and making wisecracks on camera, respectively. Despite the publishing industry’s myopic focus on “pivoting to video,” Yanagihara said the team has been cautious to ensure forays into multimedia are particularly high quality.

“I don’t believe in video just to do video. We do it only when we think there’s a real reason to do it and the story lives best in that medium,” she said. “I’m old enough and came of age in media to know there’s a lot of doing things just because you could. If you’re going to do video, you need to earn the right to do video.”

#ReadTAPoem: @LaurenRidloff, who was born deaf, will star onstage opposite Joshua Jackson in “Children of a Lesser God” (@lessergodbway) — her first theater acting job. Here, the actress reads the poem “Not,” excerpted from “All We Saw” by Anne Michaels, 2017.

A post shared by T: The NYTimes Style Magazine (@tmagazine) on Feb 14, 2018 at 11:38am PST

A recent “Read T a Poem” video shared on T Magazine’s Instagram page

Though T Magazine announced in early 2017 that it would scale back its print issues from 13 issues a year to 10, Yanagihara said the print magazine will continue to serve as a guidepost for the entire publication. However, enhancing T’s digital presence has been a crucial effort: With the help of creative director Patrick Li, the site rolled out new custom fonts, while maintaining its traditional clean lines and ample white space.

Elizabeth Lunny, publisher and vp of media at The New York Times and T Magazine, said the publication’s digital evolution under Yanagihara’s leadership will serve as an advantage to strengthening existing relationships with advertisers, while forging new partnerships with luxury brands.

“As a product of The New York Times, and now especially under Hanya’s direction, luxury brands will recognize that T’s journalistic quality, affluent readership and high engagement are what make T the premiere destination for reaching their desired audiences,” she said.

The post Editor-in-chief Hanya Yanagihara on why T Magazine needed a ‘harder edge’ appeared first on Digiday.

In the new world of banking, banks come to their customers — not the other way around.

On Tuesday, Wells Fargo released a new “predictive banking” feature that pushes insights based on customer data and more personalized guidance. It could flag higher-than-normal automatic monthly payments or remind customers to transfer money between accounts to avoid an overdraft fee, for example. It’s similar to how other banks are experimenting with voice capabilities; like USAA and U.S. Bank’s experiments with Alexa skills or Bank of America’s digital assistant erica.

Customers have driven the evolution of banking channels from branches to phone banking to ATMs to desktop and mobile apps for the last 100 years, but the next waves of demand aren’t driven by banks and financial services companies anymore — they’re driven by tech companies and retail, according to Brian Pearce, svp for enterprise artificial intelligence at Wells Fargo.

“The companies that are setting the bar for the industry are Apple, Google, Facebook and Amazon,” he said. “Those companies dominate our customers’ lives.”

Read the full story on tearsheet.co

The post How big tech and retail are inspiring consumer innovation at Wells Fargo appeared first on Digiday.

In the latest sign of the escalating battle for talent in Hollywood, Netflix signed producer Ryan Murphy to a multiyear deal to create content exclusively for the streaming service.

AT&T is considering an unusual bid to seek testimony from the Justice Department’s antitrust chief in the coming trial over its $85 billion purchase of Time Warner, part of the companies’ effort to challenge the legitimacy of the government’s lawsuit.

Cisco Systems Inc. plans to bring $67 billion of its foreign cash holdings to the U.S. this quarter following recent changes to U.S. tax law, in one of the largest repatriation plans yet revealed.

Millions tuned in to NBC’s Olympics coverage on Tuesday night to see snowboarding icon Shaun White win his third Winter Olympics gold medal, which consequently gave Team USA its 100th all-time winter gold. Per Nielsen live-plus-same-day data and digital data from Adobe Analytics, NBC Olympics’ Tuesday prime-time coverage posted a Total Audience Delivery of 22.6…

Starting on Thursday, Google’s Chrome browser will block certain types of online advertisements, a change Google is describing as user friendly. But some in the industry say the ad giant’s move is self-serving, and they contend Google overly influenced the process that selected which ad types to block.

A top U.S. regulator recommended approving SpaceX’s plan to provide internet service through satellites, a move that could expand broadband availability across the U.S. and beyond.