Here's everything you need to know about the world of television for Tuesday, February 20th, 2024.
IF CONTENT IS KING, THEN AD-TECH IS THE KING'S CASTLE
After a few weeks of rumors, Walmart announced today it plans to acquire Irvine, Calif.-based consumer electronics manufacturer Vizio in a deal worth about $2.3 billion.
Now, Walmart might be Vizio's biggest customer but that's not the reason why this deal happened. It took place because Walmart is expanding its advertising business and Vizio’s SmartCast Operating System (OS) - which is what Vizio uses on its smart TV and other devices - currently has 18 million active accounts. Walmart plans to to roll that account information into Walmart Connect, the retailer’s closed-loop omnichannel media business and use the data as a way to reach and target across its massive customer base.
While this might not sound like a television story at first glance, the merger is being done for the same reason why Tubi asks customers to create a free account in order to "personalize" its service. Collecting data - and being able to attribute to a specific household - is incredibly important and it's the reason why digital advertising is becoming such a revenue driver.
With the addition of Vizio's viewing data, Walmart connect can create non-personally identifiable profiles that include an email address, IP address, location, shopping data along with other information gathered from outside sources. It allows Walmart to market directly to its customers in a way that can be highly lucrative.
And the average person has no idea how much money is in play with digital advertising. Digital advertising is a much higher-margin business than the retail sales business (or most traditional media businesses), which is why Walmart is estimating it will soon be making more revenue selling digital advertising across its retail and digital platforms that it will in store sales.
And that's the second part of this for Walmart. It's not just that Hoovering up as much customer data as possible makes its core business more effective. Having that first-person data about tens of millions of households allows the company to sell increasingly targeted digital advertising to anyone who will pay the price.
Developing that first-person customer relationship is perhaps the most important thing any media business can do right now. Being able to somehow connect email and IP info with viewing data and credit card information opens up all sorts of new ways to monetize the customer relationship.
That is why some streamers don't want to be associated with Amazon Channels. Because while streamers do nab some new subscription money, Amazon is the one who has access to the specific customer data. In fact, Disney head Bob Iger has frequently argued in recent months that developing that first-person relationship allows Disney to sell to a customer directly and by targeting them with marketing and advertising pitches tailored to their previous behavior across the Disney network.
As streamers continue to launch ad-supported tiers, there is a tendency to focus on how much advertising gets sold and whether an ad-supported option brings in new subscribers. But it's also about trying to figure out new ways to develop and expand customer relationships.
And that question colors every big media deal these days. One of the biggest challenges for that proposed sports app (which I am increasingly convinced may never happen) is deciding how the ad tech rolls out advertising on the platform and how the customer data is shared across the partner's very different ad-tech systems.
It's also the lesser-covered part of every conversation that involves revenue from an ad-supported tier. It's not just how any subscribers you can garner for your service. Revenue is also tied into how well the ad-delivery technology does the job of matching viewers to the specific demographics desired by an advertiser. Generally speaking, the more accuracy, the higher CPM (cost per thousand views) the platform can charge.
The digital advertising business isn't one that is all that familiar to most TV critics and industry analysts. But it's hard to find a part of the TV industry that isn't impacted by advertising and how data is collected and used.
SPEAKING OF NEWS THAT DOESN'T MEAN WHAT YOU THINK IT DOES
Disney announced today that it is licensing its films to Sony for the manufacture, distribution and marketing of DVDs, Blu-ray Discs, and 4K Ultra HD Blu-rays.
The deal includes both new releases and catalog titles, which Sony will sell and distribute through retailers and distributors throughout the North American market.
There has been a lot of whining today about Disney exiting physical media and how it's the end of an era.
But as anyone who still buys physical media can tell you, Disney's Home Entertainment division has been less than aggressive in recent years with its releases. Many popular titles don't get a 4K release and much of the packaging just seems thrown together.
So I don't think this move is all that big of a deal. The arrangement is similar to the deal Universal Pictures Home Entertainment and Warner Bros. Discovery Home Entertainment have with their joint venture, SDS. That company distributes the physical media products while each studio’s home entertainment division retains control over marketing, promotions and publicity.
That will be the case here, with Sony handling the manufacturing, distribution and sales of the physical media. While Disney is responsible for the PR and marketing.
AND ABOUT THAT SPORTS-CENTRIC APP
You could write a medium-length novella recounting all the reasons why that proposed Disney/Fox/Warner Bros. Discovery proposed sports-centric app is in trouble.
The latest problem comes from Fubo TV, which has filed a lawsuit claiming the three companies have colluded to shut out competitors:
“Instead of competition, Defendants have chosen collusion — giving their own cartel, and no one else, the ability to market and sell a live-sports-centric package,” FuboTV alleges in the lawsuit. “They have thus ensured that their combined entity will not face effective competition. They are now harming, and threaten further harm, to United States competition and consumers."
FuboTV has a couple of good points. First, it's easy to see a scenario in which this new joint venture might be able to get exclusive access to games and channels rivals such as Fubo wouldn't be able to license at a competitive price.
But I suspect it's also driven by Fubo's desire to unbundle each company's entertainment channels from their sports networks. Currently, FuboTV is forced to take a number of entertainment and news channels it doesn't want in order to get the sports networks it needs to be a sports-oriented streamer. Removing those channels would allow it to drop the cost to consumers and get its price down closer to the $45-50 a month range that the new sports JV is reported to be considering.
And that might be the biggest consequence of this proposed JV. As things stand now, each of the big media companies forces vMVPD's, cable and satellite systems to take an entire bundle of often useless channels in order to get the smaller number of core networks most consumers want.
If Disney, Fox and Warner Bros. Discovery are forced to unbundle their networks when they sell their programming to rivals, you are going to see some massively different lineups on some platforms.
ODDS AND SODS
* David Katzenberg will helm a spinoff of Ferris Bueller’s Day Off for Paramount. Produced by the creators of Cobra Kai, Sam and Victor’s Day Off will follow the valets from the original 1986 John Hughes film.
* I review the really interesting documentary Becoming King, which premiered yesterday on Paramount+
WHAT'S NEW TONIGHT AND TOMORROW
TUESDAY, FEBRUARY 20TH:
* American Experience: Fly With Me (PBS)
* Crime Nation Series Premiere (The CW)
* Little People, Big World Season Premiere (TLC)
* Mike Epps: Ready To Sell Out (Netflix)
* Quantum Leap Season Two Finale (NBC)
* Renovation Aloha Series Premiere (HGTV)
* Risqué Business: Netherlands & Germany Series Premiere (Netflix)
* The Good Doctor Season Premiere (ABC)
* The Rookie Season Premiere (ABC)
* Will Trent Season Premiere (ABC)
WEDNESDAY, FEBRUARY 21ST:
* Can I Tell You A Secret? Series Premiere (Netflix)
* Constellation Series Premiere (Apple TV+)
* Criminal Record Season One Finale (Apple TV+)
* Dolly Parton's Pet Gala (CBS)
* Messi’s World Cup: The Rise Of A Legend (Apple TV+)
* Pawn Stars Season Premiere (History)
* Pawn Stars Do America Season Premiere (History)
* Star Wars: The Bad Batch Season Premiere (Disney+)
* The Family Stallone Season Two Premiere (Paramount+)
SEE YOU ON WEDNESDAY!
Follow me on Twitter: @aysrick
Follow me on Threads:
Follow me on Bluesky: