Wible's Weekly - Cord Cutting Stats, Mobile Ads, and Digital Game Inflation - Janney/MediaEntertainment

Cord Cutting amp8211 Despite remaining relatively small to date in the US Canadians appear to be cutting the TV cord in larger numbers 16 of Canada39s adult population now watch all their TV from online sources while an additional 35 use both traditional TV and online video according to comScore and the Canadian Press This data is all the more remarkable given the state of UBB and usage caps for broadband in Canada According to a survey by GfK broadcast only US homes are on the rise and claim 19 now solely rely on broadcast TV vs 14 in 2010 this number seems high but the study notes that 60 of those who canceled their pay TV service cited costcutting as the reason If true this could be more troubling given the combination inelastic demand for broadband rising programming cost and improvements in cheap OTT servicesGreener Pastures YouTube producers are looking to branch out of YouTube as their exclusivity clauses expire YouTube is on board with this strategy as most channels will likely retain a presence on YouTube and other outlets could help drive traffic to YouTube Adding other outlets eg cable networks Hulu etc could help broaden demos beyond the 13 to 24 year olds that YouTube is generally known for TubeMogul estimates that the average YouTube 2Q13 preroll CPM excluding those sold directly was 749 vs 926 a year ago which is already well below TV and getting cheaper as TV premiums growMobile Advertising amp8211 Advertisers are following the migration of search to mobile and are putting more dollars to paid search ads on the devices US mobile search spend doubled YOY in 2Q13 on both smartphones and tablets while overall search spend was up 7 according to eMarketer Tablets saw a larger increase in both spending and delivered impressions while smartphones grew faster in terms of clicks As a result CPC on smartphones decreased 13 while tablet CPCs were up 13 Tablets continue to represent the majority of mobile paid search ad spend driven by the importance of tablet real estate to drive conversion among shoppers However search is expected to decline slightly in importance through 2017 490 in 2017 vs 517 in 2013 while the display and other formats will take a larger share of mobile ad spendingDigital Game Inflation amp8211 MSFT 3567Neutral Janney analyst Bill Choi will soon roll out its update to Xbox Live which effectively increases the price of games on Xbox Live The update converts existing MSFT points into local currency and games that you could get for a certain number of points now cost more in real currency This will probably upset the gamer community particularly those who have acquired many points and could be another example of MSFT being out of touch with gamers We note that MSFT still sells digital games at massive premium to the fair market value seen in the used marketIPTV Subs amp8211 According to a report from Infonetics Research IPTV services continue to gain market share of subs across the globe Telcos are the driving force as they leverage their own infrastructure They are particularly successful in emerging markets that lack a more developed traditional pay TV market but also show impressive growth in developed countries Dutch provider KPN and Brazilian GVT grew 77 and 62 respectively in 2012 IPTV may slow in the US as VZ has effectively stopped its buildout of a fiber network We believe the US market is more difficult given the size of its landmassTony Wible joined Janney Montgomery Scott in 2008 and is a Managing Director covering the Media and Entertainment sector after spending the previous 10 years at Citigroup Investment Researchamp8212most recently covering the Broadcasting and Entertainment Services industries Tony can be reached at twiblejanneycom Janney Montgomery Scott LLC is a US brokerdealer registered with the US Securities and Exchange Commission and a member of the New York Stock Exchange the Financial Industry Regulatory Authority and the Securities Investor Protection Corp Disclosures may be reviewed at Wible39s WeeklyRead all Tony39s MediaBizBloggers commentaries at Wible39s Weekly JanneyMediaEntertainment Check us out on Facebook at MediaBizBloggerscomFollow our Twitter updates MediaBizBloggerThe opinions and points of view expressed in this commentary are exclusively the views of the author and do not necessarily represent the views of MediaBizBloggerscom management or associated bloggers MediaBizBloggers is an open thought leadership platform and readers may share their comments and opinions in response to all commentaries

Click to Make Your 2025 Contribution to Support the MediaVillage Education Foundation

Wible's Weekly - Cord Cutting Stats, Mobile Ads, and Digital Game Inflation - Janney/MediaEntertainment

Author

Publish date

Channel

Tony Wible

The Ad Council, Huntsman Mental Health Foundation and Amazon Announce “The Mind Set” to Support Mental Health - Ad Council InSites

More Videos:

Click to Make Your 2025 Contribution to Support the MediaVillage Education Foundation

Wible's Weekly - Cord Cutting Stats, Mobile Ads, and Digital Game Inflation - Janney/MediaEntertainment

Enjoying This Commentary? There's More to Love

Tony Wible

The Ad Council, Huntsman Mental Health Foundation and Amazon Announce “The Mind Set” to Support Mental Health - Ad Council InSites

The payment was successful

Cookies