Live TV (er, Non-Sports Live TV) Comes To Streaming!

Share on facebook
Share on twitter
Share on linkedin
Share on whatsapp
Share on email

Sometimes you can immediately recognize certain strategic moves as game changing. The big, obviously huge moves, like AT&T buying Time-Warner. Like NBC announcing Peacock. Like Bob Iger stepping down. You don’t need me to tell you those news stories matter.

But if a company is a “collection of decisions”—strategy is choosing what to do and what not to do—a lot of smaller decisions slide under the radar. The story of the week fits that bill; it isn’t obviously huge news, but long term could have big strategic ramifications for the streaming wars.

(Sign up for my newsletter to get all my columns, streaming ratings reports, and articles in your inbox.)

Most Important Story of the Week – Amazon’s Prime Video Gets The Rights to the Academy of Country Music Awards

Prime Video will debut the first “live-streamed” awards show with the Academy of Country Music (ACM) Awards sometime next year. As a “first”, this story did get a some coverage in the usual places. And sure, Amazon has already entered the sports business. They already stream NFL games and recently expanded their deal with the NFL. But no streamer had gone all in on a live, non-sports event yet.

That’s a lot of qualifications—live, non-sports—but it matters. Let’s explain why.

Live, Linear TV Delivers a Different Value Proposition than On-Demand Content

What makes this story so important? It’s the difference between “live” and “linear”, two phrases we use a lot, often without defining the difference. Since I’m in the process of writing a definitions page for the streaming wars (Send me your suggestions!) here’s two early definitions:

“Linear” – A continuous stream of video programming. It stands in contrast to “on-demand”, because you don’t choose where to start or stop the program, as its already running.
Examples: Broadcast TV, live cable TV, FASTs like Pluto, Xumo or Tumi

“Live” – Usually linear video that is being aired or streamed as soon as it is being recorded, though usually with a short delay.
Examples: Breaking cable news, sports events, Twitch streams.

Notice, linear TV doesn’t have to be distributed in traditional methods, even though that’s usually how we use it. Including me. We—as in the industry—say “linear TV”  as a stand in for cable, satellite and over-the-air TV. Because we’re describing programming that, as one website explained the origins, has been “lined up” by programmers. Since, historically, that usually meant cable, satellite and broadcast, “linear TV” is synonymous with traditional distribution.

But it doesn’t have to be. As the definition above shows, the FASTs—free, ad-supported streaming TV—like Pluto, Peacock and their ilk—also “line up” programming. And notice that “live” doesn’t have to mean traditional distribution either. As anyone who has logged onto Twitch knows, live can be digital too.

Instead of thinking about distribution, when we use use the words  “linear” or “live”, we should focus on the function they offer. And the value proposition that function provides consumers. 

On-demand, the converse of linear, for example, freed folks from having to start TV on time. That was a tremendous change that delivered all sorts of value. (And honestly, the DVR delivered most of the value here…) While on-demand is vastly superior to most linear programming, on-demand isn’t better for all programming.

Take “lean back” viewing. Sometimes folks don’t actually want to decide what to watch. Which means “on-demand” isn’t what customers are looking for. Linear TV steps in to provide the often-derided, but very real, function of making the choice for customers. This can include old TV shows—think Friends reruns—or old movies—think the MCU movies airing non-stop on TNT—or kids shows—they don’t distinguish between episodes usually.

While most folks don’t want to admit it, sometimes TV is just TV. Sure, you’ve seen Joey with his head inside a turkey a dozen times. But why not watch once more?

Live TV provides another function. Specifically capturing events that are happening in real time to get the most accurate story in the moment. Examples of programming that fit this bill are sporting events, news broadcasts, breaking news, and certain big political or entertainment events (think Presidential Inaugurations or Awards shows).

Thus if we think of “TV” as a bundle of different functions, on-demand programming only fulfills a subset of those functions. Too often we overrate the value of “on-demand” versus the value of “linear/live” TV. Sure, on-demand programming (starting with the DVR) changed how folks consumed TV, but clearly customers value live sports, breaking news, and lean-back programming too. The explosion of FASTs shows this. Same for the steady adoption of vMVPDs by the latest generation of cord cutters.

For most of the streaming wars, streamers forgot this fact. Amazon’s latest move shows some (belated) recognition of this reality.

This Move Provides Prime Video Additional Content Differentiation

Which is why I like this move for Amazon. Assuming the price wasn’t outrageous. (Based on Amazon’s past spending habits, it probably was.)

This move separates Prime Video from (one of) their biggest rivals, Netflix. Prime Video spent years competing by trying to be Netflix, which meant chasing after Oscar-aspiring films, making prestige-y/critically acclaimed dramas, and then trying to make big, expensive genre shows. All of which led to a second or third place in the streaming wars on its own. Arguably, this year alone, Disney+  has debuted more, better hit shows than all of Prime Video’s history. Prime Video tried to compete on content, and is arguably in fifth place. (Behind Disney, HBO Max, Netflix and probably CBS.)

At the same time, much more quietly, they built a streaming device empire—mainly by giving them away for much below cost—and then starting a channels business (see below) within this universe. Those moves pivoted away from Prime Video as the center of Amazon’s video universe. It also expanded the focus of Amazon’s video energies from simply on-demand to the entire TV bundle, including live and linear content.

And now Prime Video can take advantage. Buying the rights to the ACM Awards offers a genuine difference with Netflix. Since Netflix doesn’t have a linear capability or really a live TV capability, it’s finally a type of programming Netflix can’t match. So it’s a smart move. And it’s big for one other reason…

The Biggest Big Deal – Amazon Has Exclusive Rights

As far as we can tell, Amazon grabbed the rights for the ACM Awards from CBS for all distribution. In a way, this is even more important from the sports rights deals of last spring, where Disney, TNT and others kept both traditional and streaming rights. If folks want to watch the ACM Awards—and it’s not clear they do—they have to have Prime Video installed. (Because they probably already subscribe to Prime!)

The ACMs should be aware this carries huge risks. As I’ve written before. And as Joe Rogan may be experiencing now. This is always the tradeoff with exclusivity vs ubiquity: the paycheck can be higher in the moment, but it can cost you customers in the long run. Maybe Amazon can match the ACM Award’s previous audience, or maybe tune in falls off a cliff.

Does it matter for an awards show, which is a one-time a year event? Maybe not, but it’s something to consider.

The Big Caveat – The ACM Awards Are Not a Ratings Smash

Yes, ratings for all awards shows are down. By 50% or more from peaks of last decade. And the ACM Awards are down too, making them one of the smaller awards shows. I’d add, the other broadcasters all seemingly have country music awards already. ABC has the CMAs and host of CMA related shows. CBS will actually air the CMT Awards instead. So this is a big deal, but for an awards show that had 16 million viewers as of 2016, and 6.3 million this year. If Amazon doesn’t market this well, the actual viewers—and hence reach—could plummet.

Lastly a Prediction: Amazon Will Declare This a Ratings Smash

No matter how many folks actually watch, lock it in that Amazon will declare this a ratings smash. The good news for us is that due to all the third party measurements, we’ll know if this is true or not. For example, Nielsen can tell us how many folks watched their live stream. That’s useful!

Speaking of Nielsen, let’s go to our next story. 

Almost Most Important Story of the Week – NBC Pushes for New Measurement

NBC is very, very, very unhappy with Nielsen’s measurement of traditional ratings. Specifically, Nielsen has admitted that the pandemic last spring caused them to undercount some traditional ratings. (This feels a pinch ironic, since most folks using this issue to slam Nielsen as unreliable also used those numbers to tout the death of traditional linear TV, but oh well.)  As a result, NBC is seeking a new measurement system/standard and has sent out proposals to various ad-tech and analytics companies.

Listen, having reliable measurements for ratings is vitally important to any performance industry. And as a heavy user of Nielsen data, I’m a pinch conflicted. (My streaming ratings report—read the latest here—is right now about 80% Nielsen.) My uses for the data, though, are less exact than what advertisers and ad-supported businesses need. If Nielsen is off by 10% for a given show, it will mostly stay in the same place in the rankings. If it’s off 10% across shows, though, that’s can be the difference between profitability and not for a cable channel.

That said, it’s not like digital ad measurement has been fantastic either. It’s not hard to find stories from big tech companies—see Facebook— delivering fraudulent ad views or smaller ad-tech companies—see this article—being taken by fraudulent views too. For NBC, they don’t care about fraud since it helps sell ads; for Nielsen they do, but that can mean undercounting. So do advertisers feel as strongly as NBC? That’s unclear.

It will be fascinating to see if 1. NBC can find a better measurement system and 2. That system is more open than Nielsen/other in-house data and 3. If NBC can get industry-wide adoption for whatever they come up with.

Other Contenders for Most Important Story 

T-Mobile Offers Another Free Streaming Service

One funny aspect of the constant emphasis on “CLV”—customer lifetime value—and the streaming wars is to forget just how much more valuable a cable or cellular subscription is compared to a streaming subscription. (They just don’t have the growth prospects of video.) Which is why every cellular company offers some streamer for free. Or in some cases, multiple streamers for free for the right package:

T-Mobile: Apple TV+, Netflix
Verizon: Disney+/Bundle, Discovery+

The news this week is that T-Mobile will add Apple TV+ to its free offerings. Right in time for the Apple-provided Apple TV+ offer to expire.

HBO Max Will Depart Amazon’s Channels Business

Speaking of Amazon Channels (see above), HBO Max will stop allowing customers to subscribe through Amazon’s system. Since Amazon can charge up to a 30% cut and controls the user experience, many of the big guns have avoided Amazon Channels. One of the notable exceptions was HBO, starting a few years ago. Now that WarnerMedia feels good with the HBO Max subscriber numbers, the news is they’ll leave the Amazon Channels business. Owning the customer relationship is always a smart plan, so good for them.

AMC Networks CEO Josh Sapan Steps Down

The head of AMC Networks will step down in August. Josh Sapan has been leading AMC since 1995, so that’s the end of an era. On one hand, he made some smart strategic moves. He leaned into nto scripted TV series to boost cable subscription fees in the mid-00s for example. On the other hand, AMC has arguably been slow to pivot to streaming, partly because they never made enough series in-house to build a content library. So overall a fine tenure.

Oh Yeah, the South Park Creator’s Deal Was Big News

When I listed a string of recent first look and overall deals, I didn’t mention the South Park creators Matt Parker and Trey Stone signing a huge $900 million deal with ViacomCBS. Now, a huge caveat is that this deal is partly an early payment of their future streaming rights revenue. 

But it doesn’t include production costs (which many highly valued deals do) and covers new projects, like South Park films. Overall, this seems like a smart, though expensive deal for ViacomCBS and should clear the way to bring South Park back to Paramount+ whenever the HBO Max deal expires in the middle of the next decade—assuming Paramount+ survives that long—while also bringing some South Park content to Paramount+.

M&A Updates – ViacomCBS May Not Sell After All

File this New York Post headline “ViacomCBS waiting for other suitors: sources” in the “mergers & acquisitions are hard” folder. There are lots of M&A rumors always and forever, but getting deals across the finish line is hard.

Other Things to Listen or Read

The best episode of Malcolm Gladwell’s podcast Revisionist History this season was his take on washing clothes. Like he even said, yes he sounds like a shill for Proctor and Gamble. But his message about how to have the smallest carbon footprint shouldn’t be missed: use the dishwasher to wash  and use cold water to wash laundry!

The Entertainment Strategy Guy

The Entertainment Strategy Guy

Former strategy and business development guy at a major streaming company. But I like writing more than sending email, so I launched this website to share what I know.


Join the Entertainment Strategy Guy Substack

Weekly insights into the world of streaming entertainment.

Join Substack List
%d bloggers like this: