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YouTube is planning to launch a paid subscription video service later this year. But the Google-owned company is having a tough time getting some of its content partners to sign up, according to several sources at publishers and multichannel networks.
YouTube approached a number of video publishers and multichannel networks (MCNs) late last year, asking each to sign a “subscription offerings amendment” that would make all of their YouTube content available through a paid service, according to Digiday’s sources. A sleek, ad-free video subscription service could generate a pivotal revenue stream for YouTube, which has reportedly failed to turn a profit despite attracting over a billion monthly viewers. Yet several of YouTube’s current content partners have been reluctant to sign on the dotted line.
“The amendment was so general,” said an executive at one publisher with a major YouTube presence. “It’s basically saying, ‘Hey, sign up and your content will be behind a subscription wall.’ But there was no revenue share or any guarantee you wouldn’t just lose out on the ad revenue. It made us really nervous. We are reticent to sign something without knowing what it actually means for us financially.”
That publisher has yet to sign the amendment, waiting for more information and revisions from YouTube before agreeing to pipe its content into a YouTube subscription service. YouTube itself has yet to nail down the scope of its subscription plans, the executive told Digiday, even though YouTube’s content chief Robert Kyncl suggested at Recode’s “Code/Media” conference last week that YouTube is putting the “final tweaks” on the service.
One MCN executive said YouTube intended to launch the service in the first quarter of 2015, but will miss that launch window. A YouTube spokesperson declined to discuss that assertion or anything about the subscription service on the record.
The keynote panel at the Digital Entertainment World conference in LA on Tuesday gave a great view of the divergent interests of 20th and 21st century media. Mobile video was very much on the mind of web natives, while mainstream media still seems more interested in extending the reach of its traditional television fare.
Jim Underwood, Head of Entertainment, Global Vertical Strategy at Facebook, threw down the data gauntlet stating that 75% (or 11 hours) of our waking hours are now consumed with the consumption of media. It could be argued that Facebook is a prime mover in this extraordinary statistic. The company has rocketed to the number 2 spot in the delivery of online video, second only to YouTube. In particular, the company has tripled the amount of video it delivers in just 6 months. This is largely on the back of the introduction of autoplay for videos. Mr. Underwood said that, though videos do not play when they are out of the field of view, the mere act of automatically starting the video results in many more people sticking around to watch.
Not to be outdone, Ezra Cooperstein, President and COO of Fullscreen, said that over the last 4 years the amount of mobile video starts the company sees has grown from 20% to 60%. He added some color to this, saying that girls between 13 and 17 years don’t’ even think about a television anymore. Their phone is their TV. Even though much of Fullscreen content is consumed on a phone doesn’t mean it’s cheap to produce. He said that content businesses are capital intensive. To emphasize the point he said a good deal of the cash Fullscreen received when the Chenin Group and AT&T bought the company is going straight into creating great content.
From Samsung’s new curved Note Edge to the flurry of Google Android Wear watches from LG, Sony and Asus, we’ve got you covered on the hottest products launched at the IFA consumer electronics show in Berlin.