Appearing before the French Senate’s commission of Culture and Communication, Maxime Saada, chair of the Canal+ board, has announced that SVoD service Canalplay will cease operating in the coming weeks.
“It’s over for Canalplay. In the last two years, we have been taken off the map in this market which is surplanting television. We had a French Netflix, it was killed,” said Saada.
The platform has seen subscriber numbers plummet from 800,000 to just 200,000 today.
“We were deprived the possibility of exclusives for Canalplay when Netflix stepped into the market,” Saada added.
Giving the example of the upcoming launch of a Studiocanal channel in the US without local hits Versailles or The Bureau, Saada urged the French State to re-examine the production decrees in order to allow French TV groups to own the rights to the drama series they’re investing in.
“We [are bound by] a ball and chain when competing with hegemonic US players such as Netflix, which is recruiting 100,000 subscribers each month in France, and investing billion of dollars into content.”
Saada pleaded for French production players to be helped and protected by new, fairer rules. He suggested that tackling piracy could represent 500,000 new subscribers and an additional €40 million to invest into the country’s movie industry and sports rights.
On the fact that Canal+ lost the rights to the French Football Ligue 1 (to Spanish group Mediapro), Saada also put forward the question of rights sovereignty.
If this year’s VidCon is any guide, its very busy organizers will soon have a much less difficult time deciding which of the many social-media platforms it should feature in coming editions of the conference. At the rate things are going, all the sites will look alike anyway.
As it was, this year’s online influencer gathering featured tens of thousands of fans, dozens of panels and performances, and all the usual big platforms alongside newcomers such as LinkedIn and Twitch. Many platforms had news to tout, but too often, their “news” sounded very familiar.
Video? Check. Long-form video? Check. Disappearing posts? Messaging? Live Video? Monetization tools? Check, check, check. And yes, check.
Call it the Big Schmear. The “cream cheese” of content and services on your favorite big bagel of a social-media platform will soon be festooned with pretty much every ingredient that everyone else has on theirs. And if anyone comes up with a new idea, everyone else will be quick to take a bite, by buying or copying it.
Everyone Wants To Be Everyone Else
That creeping, slightly creepy convergence was a constant source of conversation among those I talked with throughout the show. We were all discussing the implications of recent news like:
– Instagram announced IGTV, a standalone (though tightly integrated) mobile app for video posts of up to an hour. The goal: to be more like YouTube, and because it’s a mobile-friendly vertical format, Snapchat.
– YouTube announced more and more widely available monetization tools for its creators, including merchandising, subscription memberships, and event ticketing. The goal: to be more like Twitch. Musical.Ly and others with plentiful ways for creators to cash in on their audiences. .
– Twitch owner Amazon debuted its Merch merchandise fulfillment service, and spotlighted licensed goodies from veteran online stars Hannah Hart and Shane Dawson. Amazon also sponsored an “industry lounge” on the show’s top floor that fed and watered many brand and online-video executives. The lounge showed off even more Amazon offerings, like Handmade, a product service that seems a lot like Etsy.
– Snapchat extended its Shows, short-form episodic videos used heretofore by big publishers, to creators such as makeup guru Patrick Starrr. Snapchat also will begin sharing ad revenue with its influencers. The goal: to be more influencer friendly, like YouTube and Instagram.
– Facebook launched FB.GG, which gathers the site’s game-related creators and content in one place. The goal: to be more like Twitch and Gaming.YouTube.
These are only the latest lurches toward feature convergence. Most notoriously, of course, Facebook and its various holdings have been shamelessly copying every useful bit of Snapchat. In a minor moment of karmic justice, the copying hasn’t forestalled the flight of teens from Facebook.
In the past couple of years, Facebook also launched Watch (to be more like YouTube and Netflix) and Live (to keep up with Twitch, YouNow, LiveMe and similar players). More recently, Facebook commissioned CNN, ABC News, and other traditional media sites to create Watch-specific news shows. This may be another Facebook copycat move, given the notable, if uneven, success of news outlets on Snapchat Discover.
I’m dubious about all these #IAlso initiatives. It doesn’t take much innovation to straight copy Snapchat Stories, especially when your version even uses the same name, as on Instagram. Conversely, fans haven’t punished Instagram, which announced that it now has 1 billion users, up 200 million just since last fall.
Does More Make You Better?
The bigger question, of course, is whether adding everyone else’s features makes your favorite platform any better, or any more of a destination, or for that matter, any better a place for an influencer to ply her trade, or to cut a deal with a brand.
Every successful platform to date was built on its own unique DNA, the user interface and mechanics that made it work for the audience it created and the influencers who rose to prominence there. Doing a Jurassic Park on that DNA, extracting and bolting on the features of another platform to create some bellowing hybrid beast, doesn’t automatically translate to new fans or a better experience for anybody.
Now admittedly, not everyone at VidCon was as concerned as I am. One panel of industry notables was asked, “do all the platforms have to evolve to do everything?” Maybe not, some said.
Ivana Kirkbride, GM of OTT for Verizon’s Oath unit, insisted that “every platform serves a specific purpose.” Even look-alike functions manifest in different ways on different platforms, she said. “Facebook Watch is a very different experience” from YouTube, Netflix, Snapchat, traditional TV or even whatever IG TV becomes.
I’m certainly willing to accord Kirkbride some deference, given her run as a top executive at YouTube and Vessel before taking over Verizon’s Go90 unit and now all of its over-the-top video initiatives.
And long-time media critic and journalism professor Jeff Jarvis suggested that we’re only beginning to see what’s possible with online video, as it transforms nearly every corner of the media business, bringing lots of opportunity for more features and engagement in the future.
Things Are Looking Good For Influencers, But Diversification Still Key
I do expect, however, that the coming convergence means a lot more work for influencers themselves, and probably far less clarity about where they should devote their efforts.
Late on Day 2, I slipped into a standing-room-only workshop on branded content featuring influencer Brent Rivera and WhoSay Executive VP of Talent Harvey Schwartz. The workshop detailed the kinds of clever cross-platform posting and marketing strategies that influencers and advertisers must use in an era where, as Schwartz put it, “organic reach is dead.”
The highly technical conversation was not for neophytes. But it reminded me how far the industry has come in just a few years. In a conference room far above the milling crowds of pre-pubescent fans on the first floor of the Anaheim Convention Center, two of online video’s more prominent members talked about the science of online influence.
Instagram, the Facebook-owned photo and video-sharing app, is going pro. Last week, the company launched IGTV, a new long-form video app, which will also be viewable inside the main Instagram app.
IGTV features much longer videos than those on the main app, with a heavy emphasis on ones from professional creators. As with Snapchat, the videos will be in the vertical format which is increasingly becoming the default on mobile.
Instagram has tremendous scale, but it saw room to grow in the video ad market.
It’s hard to ignore the opportunity. According to eMarketer, U.S. digital video ad spending will rise to $17.87 billion this year, up 22% from last year. It is expected to jump 19% again next year. Meanwhile, 181.7 million Americans will watch video on their smartphones at least once per month, up 6% from last year.
“Instagram’s new video hub is all about stealing mobile video views away from YouTube and Snapchat, while making Instagram the preferred choice for all creators,” Eric Lam, CEO of the influencer marketing platform Revfluence, tells Digital News Daily. “It’s in line with Facebook’s mission to be king of the hill on mobile video, especially given video’s unparalleled importance to brands today and the shift by younger audiences from Facebook to Instagram.”
Instagram itself is on an explosive growth streak, and the expansion into long-form video appears designed to keep that going. Per eMarketer, Instagram will generate $5.48 billion in U.S. ad revenue this year, up 70.4% from last year. It has nearly 105 million users, up 13% from last year.
That scale is very appealing to brands, influencers and professional video creators looking to reach that massive audience. A dedicated app for long-form premium content, combined with a vertical for that content in the main app, could provide new prime real estate for marketers looking for a brand-safe place to advertise on the mobile platform.
Of course, influencers, creators and brands should also be ready to jump to another platform should the need arise, Telaria CEO Mark Zagorski tells Digital News Daily.
Viacom announced the launch of MTV Studios, a new unit that will develop new series for partners across SVOD and linear, with a focus on beloved shows, franchises and spin-offs that span MTV’s 35-year history.
MTV Studios’ initial slate includes a reimagined version of the feminist icon “Daria”; cult sci-fi hit “Aeon Flux”; groundbreaking reality series “The Real World”; and an update of the Emmy Award-winning coming of age unscripted series “Made.” The slate will also include two new titles including “The Valley” (working title) and “MTV’s Straight Up Ghosted.” Within this ecosystem, other brands follow this same strategy. Children’s channel Nickelodeon will produce for Netflix the new animated series “Pinky Malinky”.
In a blog post, the company said this branching out into third-party content production has been subtly underway for some time, both in the United States and abroad. Paramount Television, the production arm of Paramount Pictures, is producing “Jack Ryan”, which will debut in August in Amazon Prime, and has produced premium content like Netflix’s “13 Reasons Why” and USA Network’s “Shooter”.
In May, Viacom International Studios (VIS) united the extensive production capabilities of wholly Viacom-owned Argentinian broadcaster Telefe and majority-owned Brazilian comedy brand Porta dos Fundos with Viacom’s Miami-based production operations, creating a multi-lingual machine that will develop, produce and distribute original content around the world. According to the company’s President and CEO Bob Bakish, “there is a lot of interest from SVOD partners in licensing library properties from MTV and Nickelodeon IP for brand-new interpretations”.
New comScore data shows one-third of TV streamers are cordless. It also shows that cordless Amazon Video users watch 13% more than Netflix users. The difference is all in their content strategies.
Cord-cutter and cord-never differences
According to comScore, one-third of households streaming to the television are cordless. The other two-thirds have either cable, satellite, or telco pay TV services. The cordless group is broken into two broad categories: those that had pay TV and got rid of it (18%) and those that have never had pay TV (14%.)
The cord-cutter group primarily skews older than the cord-never group. The largest group of cord-cutters comes from the 35-44-year-olds, with 23%. 21% of cord-cutters are millennials (18-34-year-olds). Millennials dominate the cord-nevers. 24% of 18-34-year-old TV streamers have never had pay TV, versus 15% of 35-44-year-olds.
Cordless favor Hulu, YouTube
Hulu has the highest percentage of cordless subscribers of the top four online video services. Hulu subscribers make up almost half of those without pay TV. 41% of YouTube users are cordless, and 37% of Netflix and Amazon Prime Video are cordless.
Cordless Hulu users also watch a lot more online video on their televisions. They watch, on average, 86 hours per month and stream to the TV 21.6 days per month. Cordless YouTube users watch 78 hours per month and stream to the TV 19.8 days a month. Surprisingly, Amazon Prime Video users best Netflix in engagement among the cordless users. Amazon users watch 70 hours and 19.8 days per month, Netflix users watch 62 hours and 18.6 days per month.
The comScore data could suggest that, though the cordless group rejects pay TV, they are not rejecting traditional television. They will continue to hear about great TV shows through the social and traditional media and around the water cooler. Moreover, when they hear about a great show, the place they are most likely to find it online is Hulu.
Why cordless Amazon users watch more than Netflix
Another interesting question is why those cordless TV streamers using Amazon watch significantly more (12%) than those using Netflix. This fact is particularly interesting given there is a large overlap between the two groups.
The viewing difference stems from the different content business models used by both companies. Amazon provides a far greater variety of content than Netflix because it resells other SVOD services through its Channels program. It also rents and sells movies through the Prime Video app. According to Ampere Analysis, consumers could access 26,000 distinct movie and TV show titles through Amazon Prime Video as of February 2017.*
A big majority – more than 85% — of U.S. millennials in broadband homes subscribe to least one OTT video service, according to new data from Parks Associates.
Broken down further, more than one-fourth of those millennials subscribe to three or more OTT services, and more than half take at least two subscription OTT video services.
Those totals suggest that the market among that age group is not only saturated, but present a significant challenge for OTT services retain existing subs.
“Overall penetration of subscription OTT video services among millennials has topped out, suggesting that those households that want such a subscription already have one or more,” Brett Sappington, senior director of research at Parks Associates, said in a statement. “The more interesting and important question is how many subscriptions they will keep.”
In its latest OTT Video Market Tracker, which analyzes trends and profiles of nearly 150 over-the-top service providers such as Netflix, YouTube and Amazon, in the U.S. and Canada, the research firm also found that more than 70% of U.S. broadband homes have an internet-connected entertainment device.
That data also shows that consumers, on average, own 8.6 connected CE products, up 87% since 2010. Some 70% of U.S. broadband homes have an internet-connected device, and 17% own a smart home device and an internet-connected entertainment device, the firm said.
Parks Associates predicts that more than 265 million households worldwide will have north of 400 million OTT video service subscriptions by 2022.
Around a month ago, Google released its built-in ad filter for Chrome, which blocks ads that are widely considered the most disruptive, while allowing more innocuous ones to show. This could cause major changes in the digital ad market, especially for Google’s platforms, such as search and display ads, as well as YouTube ads.
Given the context of ad blocker usage today, the move is widely considered a strategic one that could benefit the digital ad market in general and Google in particular. With a built-in ad filter on one of the world’s leading browsers, people may be less inclined to buy more stringent software. This would allow publishers, especially Google, to make steady money off their more discreet ads—rather than losing them all to another program.
More importantly, it shows that Google is willing to listen to users’ preferences.
In 2016 there were over 615 million devices running ad blockers of some sort, with growth especially strong among mobile devices, according to a study by PageFair. In addition to browser extensions, users can now get dedicated ad blockers through mobile apps or VPN services. With interruption as the second highest motivator for ad blocking (29%, just behind 30% for security), Google’s concession could be the key to building goodwill.
While YouTube’s video ads may emerge largely unscathed, there’s still much that can be learned from how Google and ad publishers are reframing the terms of engagement. What was once a fight against ad blockers is now a battle against bad ads.
When Ads Go Bad
When should you consider an ad bad? For users, obviously, it’s when it detracts from their online experience. The most widely hated ads are non-skippable video ads and auto-play ads with audio. You know, the ones some advertisers call “high-impact” as a euphemism.
But consider it this way. If users hate your ads, they’re not going to like you any better. So any ad that drives users away—”high-impact” or otherwise—is something that brands and publishers should consider a bad ad too.
Furthermore, experience has shown that you get more out of listening to your customers than trying to fight them. While some websites have tried ad block walls—features that hid content from users until they removed or disabled their ad blockers—customers have proved stubborn.
When faced with an ad block wall, 74% users would rather leave than disabled their ad blocker. And considering that 90% of users have been faced with such a situation, this isn’t merely a hypothetical scenario.
Conversely, users are willing to compromise: 77% of ad block users surveyed indicated that they found some ad formats to be permissible. Skippable ads are likely to tip the balance in advertisers’ favor: research from Treads showed that 79% of consumers would consider disabling an ad blocker if they had the option to skip or close ads.
The takeaway, ultimately, is that pitched battle with the audience does publishers no good. For brands, it could very well do lasting harm. The best way forward would seem to be close to the options Google has chosen, which is finding the middle ground.
The question we’re left with is this: how can video ads better satisfy users’ preferences?
Interruption is the main culprit in dissatisfied viewers, so the various solutions have attempted to address it in different ways.
Some solutions focus on content adjustments. These have more to do with the conceptualization and execution of ads on the creative front.
Other approaches have attempted to tackle platform issues. These have more to do with the technology used in calling and displaying ads.
In terms of content, many analysts say that a move to native content is a good idea. The Treads research shows while 48% of users consider pre-roll ads intrusive, only around 23% said the same of native video ads.
For those looking to reach audiences specific to YouTube, however, that’s not much of an alternative. And that is where influencer marketing steps in. Having influencers on YouTube—or other video platforms—benefits you in two ways.
The first is the standard set of benefits you get from influencer marketing. You gain access to a captive, targeted market; your brand is recommended to them by someone who knows how best to reach them, and you get the endorsement of someone they trust. If you partner with a discerning influencer, then you can rest assured that your ads are likely to mesh with their audience.
The second benefit is that by having your ads integrated directly into the video, you get around the problems of the intrusive pre-roll and jarring mid-roll formats. On top of the abruptness of such ads, they usually involve sudden alterations in quality or gaps in loading. Ads that are part of a video will play more smoothly, creating less of a disruption.
The jarring break in pre- or mid-roll ads is something that video platform Brightcove has been trying to tackle more directly. Through a method called “Lift,” they’ve attempted to solve two problems at once: the disruption and quality issues that come from having a video play in the middle of another one; and the signals that allow ad blockers to stop video ads, to begin with.
Facebook Watch, which initially launched with a mix of short- and long-form TV show-like programming, will soon include content from regular creators.
“We are now bringing videos from Pages into Watch,” the company announced in a blog post this morning. “In our testing, we’ve found that people enjoy discovering and watching a combination of shows and videos in Watch — and for creators, this means their videos may be eligible to show up in Watch to be discovered by a broader audience.”
A Facebook page is a public profile specifically created for businesses, brands, celebrities, causes, and other organizations. Unlike personal profiles, pages do not gain “friends,” but” fans,” which are people who choose to “like” a page.
In addition to widening the content on its Watch platform, Facebook announced plans to open up Ad Breaks to more creators, starting with those who are creating longer, original content that “fosters a loyal community.” The company also plans to open up fan subscriptions to more creators in the coming months.
“We’ve been testing a way for fans to support creators they love by pledging $4.99 (USD) per month in exchange for perks like exclusive content and a special badge highlighting their status as a supporter, and we are now expanding to more creators,” the blog post read.
On the interactive side of things, Facebook is launching a slate of new shows that utilize interactive features like polls and quizzes with the aim of fostering a greater sense of community between creators and users.
“We’re starting with polling for both Live and on demand videos, as well as gamification for Live,” the blog explained. “With these tools, our partners can add a range of new interactive features to videos such as: polls, quiz questions, challenges, and more. These can all be used within an individual video or to create a standalone game show.”
In the coming weeks, a range of creators will begin to incorporate polling and gamification into their shows and videos, including Brent Rivera and That Chick Angel. Facebook also announced several interactive game shows that will be launching in the coming weeks:
– “Confetti” by INSIDER: A live interactive game show made in partnership with INSIDER that will air daily. It will challenge people to answer pop culture trivia questions alongside — and with the help of — their friends. Players can see which friends are playing at the same time, and be able to see how friends answered questions. Players who answer all questions correctly will split a cash prize.
In its latest report on global advertising market trends, released June 18, 2018, MAGNA forecasts media owners’ net advertising revenues (NAR) to grow by +6.4% to $551 billion in 2018 in the 70 countries analyzed by MAGNA. That’s the strongest growth rate since 2010.
MAGNA increases its forecast for 2018 following strong market performance in the first few monthsg. +8% in the US in the first quarter, and +31% for Google and Facebook globally.
The 2018 growth (+6.4%) is an acceleration from 2017 (+4.5%), mostly due to the five billion dollars of incremental ad spend generated around cyclical events in 2018 (US Mid-Term elections, FIFA Football World Cup, Winter Olympics). Neutralizing cyclical revenues, the 2018 growth would be +5.5%, in line with 2017.
Global ad spend remains strong thanks to robust economies (US +6.4%, China +10%, Russia +12%, India +12.5%) and convalescent/recovering economies (Latin America +10%, Middle East +9%). Western Europe lags behind due to low economic growth and political uncertainty (+4.1%).
Digital advertising sales will grow by +15.6% in 2018 to reach $250 billion or 45% of global advertising revenues. Mobile ad sales reached half of total digital spend last year, and will increase to 62% of total digital spend this year. Digital will to represent half of the world’s total advertising sales by 2020.
In the US, advertising sales will grow by +6.4% in 2018 to reach an all-time high of $207 billion, including $4 billion dollars of incremental revenues from cyclical events. Excluding cyclical revenues, underlying growth this year will be 4.7% (similar to 2017).
US digital ad sales will grow by +15% this year to pass the $100 billion milestone (52% of total ad sales). Non-digital ad sales will shrink by -4.6%. National TV ad revenues will be flat while local TV will grow by +10%, OOH by +2%; print ad sales will decrease by -17% and linear radio by nearly -4%.
Next year (2019) will see a slower growth in the US: +2% in the absence of cyclical drivers, although core growth will also slow (+3.6%).
According to Vincent Létang, EVP, Global Market Intelligence at MAGNA and author of the report:
“Global Advertising Spending is going to expand by the strongest growth rate since 2010 this year, as several of the largest markets – including the US, Russia and China – experience robust economic growth. Many consumer packaged goods and automotive brands are freezing or cutting ad expenditure, which hurts the revenues of traditional media types, while digital media, used by millions of small and local advertisers, seems to be immune from slow-down so far. Linear television will enjoy modest growth in most markets however, as cyclical events bring incremental budgets and strong pricing (CPM inflation), offsetting shrinking volume (ratings decline).”
Globally, net media owners advertising revenues (NAR) are projected to grow by +6.4% in 2018, to $551 billion. This is above MAGNA’s previous forecast (+5.2% published December 2017) due to stronger-than-expected market performance year-to-date for digital media sales in particular. For instance, advertising spend grew by an impressive +8% in the US in the first quarter, while for Google and Facebook advertising revenues grew by +31% globally over the period, showing no sign of slow-down.
The major cyclical events taking place in 2018 (The FIFA World Cup in Russia, Mid-Term elections in the US, Winter Olympics in South Korea) will generate five billion dollars of incremental ad spend this year (two thirds of it in the US alone), thus contributing one percentage point to global ad growth. Excluding cyclical revenues, global underlying advertising growth would be +5.5% in 2018, i.e. level with 2017.
Global advertising demand remains strong in countries enjoying a robust economic environment (USA +6.4%, China +10%, Russia +12%, India +12.5%), and is recovering in convalescent/recovering economies (Latin America +10%, Middle East +9%). Western Europe is lagging behind due to low economic growth and political uncertainty, but double-digit digital growth and a minor boost from FIFA World Cup on European soil, will ensure moderate growth (+4.1%).
69 of the 70 ad market analyzed by MAGNA are expected to show some level of growth this year, with Singapore the only market forecast to shrink this year. The fastest-growing regions in 2018 will be Central & Eastern Europe (+9.2%) and Latin America (+9.6%), followed by Asia-Pacific (+6.9%) and North America (+6.3%).
Linear television ad revenues will grow again in 2018 (+3% to $185 billion), thanks to the return of even-year cyclical events, despite the continued, worldwide erosion of reach and ratings. Without the incremental even-year ad sales, TV would be just flat this year (+0.4% globally, -1.4% in the US).
The resilience of television is also caused by sustained demand from big consumer brands in CPG/FMCG sectors (food, drinks, personal care and household goods), media/entertainment, restaurant chains and pharmacy (where allowed). Because some marketers are concerned about brand safety and ROI accountability in digital environments, many brands have paused the long-term diversification of their media mix towards digital formats and have instead remained loyal to traditional linear television in the last 18 months.
That sustained demand for TV inventory, combined with declining supply (ratings) is driving high CPM cost inflation (ranging +5% to +15% in key markets while economic inflation remains below 2%). Strong TV pricing, however, is barely offsetting declining volumes resulting in flat revenues for broadcasters in the France, UK, Italy, Japan and the US (excluding cyclical ad spend).
Television is evolving too. “Advanced television” advertising techniques are gaining momentum in markets like the US and the UK. That includes live linear targeted ad substitution (household-addressable campaigns), on-demand TV content on television sets, and more generally the ability to buy qualified audiences (auto intenders, families with babies or pets…) with less wastage and better engagement, compared to traditional age/gender targeting. Most “advanced” TV campaigns these days are based on cable or satellite subscription and managed through set-top boxes, but the ubiquity of “smart” connectable TVs and over-the-top (OTT) devices creates the opportunity to target all TV viewers, including “cord cutters”, on the big screen around “safe” television content, through on-demand or linear consumption. Companies like Samsung, Roku, and others compete to provide the operating systems of television sets and offer “advanced” targeted advertising solutions to marketers.
Global Digital advertising sales (display, video, search, social) will grow by +15% this year, to $250 billion, slowing only slightly from 2017 (+18%), while offline ad sales (linear television, print, broadcast radio, out-of-home) will decrease by -0.2% to $300 billion. Digital media sales will represent 45% of total ad sales by the end of 2018 and MAGNA anticipates that it will reach 50% of global ad dollars by 2020. It will reach that milestone this year in the US, while the market share of digital media sales is already beyond 60% in markets like the UK or Sweden.
Digital ad spend will continue to be driven by Social (+31%) and Video (+27%) formats this year. Search will grow by +14% to $47 billion and remains the largest ad format.
Despite the scale reached by digital media spend and the controversies that hit some of the media owners in the first half of 2018, digital ad spend has showed no signs of slow-down yet. The combined advertising revenues of Facebook and Google grew by +31% year-over-year in the first quarter of 2018. Nevertheless MAGNA does anticipate a mild slow-down in the second half of the year but so far, spending from small, local, direct advertisers – often re-allocated from below-the-line marketing channels (direct mail, yellow pages) – continues to grow quickly, offsetting any slow-down in the spending from brand advertisers.
The majority of digital ad sales (62%) is now generated by impressions and clicks on mobile devices (mostly smartphones). Mobile ad sales will grow by +30% in 2018 while desktop-based ad revenues will shrink (-2%), due to ad blocking and the rapid shift of digital media consumption towards smartphones and away from computers.
Other media categories will struggle to various degrees this year as they don’t benefit from the pricing power and cyclical drivers of national television. Global Print NAR will decrease by -11% to $54 billion. Radio ad sales will decrease by -2% to 28 billion. This reflects legacy ad sales only(paper, linear broadcast spots). When and where we add an estimate of the digital advertising sales of publishers and radio broadcasters or audio pure-players, it mitigates but doesn’t offset the revenue decline. This is because online display pricing is poor and music streaming is moving towards a premium ad-free model, limiting ad inventory. Podcasting is mostly ad-supported and becoming increasingly popular; it has the potential to rejuvenate the audio media industry, in combination with the rise of voice-activated smart speakers. Just like the television industry did, the audio media industry needs to develop an on-demand leg to balance the linear leg.
The only “traditional” media category to show moderate growth in 2018 will be Out-Of-Home. Global NAR is forecast to grow by +3.4% to $33.5 billion. OOH does benefit from cyclical events but the main driver remains the roll out of digital OOH inventory. DOOH NAR will grow by +16% this year to reach $5.7 billion as new airports, malls and transport system become available for media buying this year. For instance the “old” DOOH system in the London underground is about to be upgraded and expanded, and thousands of screens are to be rolled out in the New York Subway.
Media companies have been cashing in on the world’s appetite for the royal family this spring, and ITN Productions, the in-house production company for U.K. TV news and content provider ITN, was no exception.
ITN Productions’ revenue has mainly come from selling original and syndicated digital content to publishers like the Daily Mail, HuffPost, the Guardian and The Independent to use on their own sites. For the last two years, ITN Production News been distributing this content on YouTube.
ITN Productions has seen a 40 percent growth year over year in revenue from its news, entertainment and royal family coverage on YouTube, although the company wouldn’t share actual numbers.
“Initially, we used this content to grow audiences online, but the revenue from the platforms has become much more prominent. It’s showing greater movement in a positive direction, so we’ve been paying it more attention,” said Joanna Boyd, video syndication account manager at ITN Productions, speaking of YouTube and Twitter.
SocialBlade data shows total subscribers for the royal channel have more than doubled since the beginning of April to 320,000, and average views per day are 1.2 million, up from 300,000 since early April due to an increase in content around Prince Louis’ birth and Prince Harry and Meghan Markle’s wedding. Subscriber growth for ODE and ODN have been steadier, with 300,000 and 500,000 subscribers, respectively.
Armed with the knowledge that people are avid consumers of royal family content, ITN Productions began focusing on this YouTube channel last year, posting more content — footage that would never make it on broadcast, like Queen Elizabeth II getting off a train, for instance — and creating more video playlists to keep people on its channel as well as suggesting relevant videos at points where people drop off.
“We’ve seen the growth in the last year when we started focusing on it as a core part of the news cycle,” said Boyd, adding that on June 14, the second top news story featured the queen and Markle visiting the county of Cheshire. “That’s how big they have become to be the second news story.”
A royal wedding and birth in quick succession is unlikely to happen again, but Boyd is confident the interest will continue. “The children have huge appeal on our channel; people want to watch them grow up,” she said. Equally, the popular videos are ones that typically fall outside the mainstream, like Prince Harry and Markle attending Prince Charles’ 70th birthday party, with 1.6 million views. “Everyone has the royal wedding; we have the story afterward,” Boyd added.