Curated by Stuart Fogarty stuart@admaticallycom for AFAO'Meara Advertising, Streamabout The Video Agency and Admatic Ireland.
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Mashable, the probably best regarded technology blog, has named its breakthrough brand of 2013 as Netflix. Right too. Two years ago Netflix was dead and it's a real lesson how a bricks + mortar business embraced online. You might not know, but Netflix then, was a DVD seller sending them to you by post. When they opened their online streaming business, they offered both (online or by post) but increased their price by 60% causing outrage on social Media (and a mass customer exodus). CEO Reed Hastings was named the worst CEO by The New York Times and the shares went into freefall. Then. It was only a new focus on their online business that brought back customers and early in 2013, their first real good performance with a 7m usd profit on the last quarter of 2012. And a big growth in subscribers, eating Blockbuster along the way who didn't react. They ploughed money back into the service with more content and international roll-outs. They used their money to build their business with a clear identification of low cost movies aimed at families with kids. No porn here and possibly no blockbusters, but good solid family stuff at 7 dollars a month. They released 'House of Cards' in February and it all started to come right topping 40 million subscribers now. Stunning. It was the top performing share early in 2013, up 300% year-on-year (YOY). The future could not look brighter. Better content supported by their cashpile, with an opportunity to enter new markets and with business acumen to keep at their brand, couldn't be better. They are already the new TV. Advertising money, if they decide to take it (they may not since it's not conducive to their brand offering) awaits in the billions. Subscribers looking for additional premium services like live sports, await on the sofas. It's a great digital story. The new Apple one.
Original online programming moves on. Netflix now move into the Documentary space with the announcement of 'Mitt', a documentary following Mitt Romney's bid for the US Presidency. It starts in 2006 and goes to the loss in 2012 but what's interesting is that this is typical of "digital" film making. Not the sort of thing that would end up on TV but it can end up on Netflix. TV stations are no longer the arbiters of content, thankfully. Because Netflix want new and interesting, exclusive content and this is a classic example of that. They should be thanked. It airs Jan 24.
TV is actually on a tipping point. A lot of us take the view that traditional TV is dying at a rapid pace but Saturday's story in the illustrious 'Financial Times' will only hasten things. It's a paper well read, by CEO's and Marketing Directors. The story is based around new Advertising spend data which shows, that after three consecutive decades of growth, it has finally peaked this year and now starting to decline - the tipping point. TV should capture 40% of the global 532 billion usd ad market in 2013 and then start falling. That data came from none other than Publicis ZenithOptimedia, reliable a source as you'll find. That 40% share will now go into steep decline. This is of course due to the rise of digital. The explosion of digital across multi-screens, was going to hit TV hardest always and in particular, the reluctance (ongoing reluctance) of TV stations to get involved with digital, has further accelerated their demise. A new breed of marketers too, has brought an opportunity to change and online video is also now a far sexier media buy, than traditional TV. For example, YouTube is surging + 50% with 66 billion usd in revenue this year. Google is also powering ahead on their GDN network. It is good news for digital providers and another breakthrough in their fight with TV stations who went to lengths initially, to try and put them out of business. But like a lot of businesses that simply refuse to accept digital as even an option, they lose out. And TV is digital's biggest scalp.
