YouTube TV comes clean about users. Quibi tries to create a buzz. ABC gets serious about the online news opportunity. And free is too high a price for many for Apple TV+.
YouTube TV 11th largest U.S. pay TV provider
YouTube has been pouring money into World Series and Super Bowl sponsorships over the last two years to promote its vMVPD service, YouTube TV. The $50-per-month pay TV service has been around for three years, and in all that time parent company Alphabet has kept the number of YouTube TV subs a closely held secret. Finally, in Alphabet’s Q4 2019 earnings call on Monday, Sundar Pichai, CEO of Alphabet and Google, revealed the service has acquired “over 2 million” subscribers. That makes YouTube TV the eleventh largest linear pay TV service in the U.S., behind vMVPD rivals Hulu Live and Sling TV.
He didn’t reveal any details about the profitability of the service, likely because it is very unprofitable! The service launched at $35 a month, raised prices to $40 in 2018, and $50 in 2019. However, even at the current price, it is likely that most of the revenue goes directly to TV programmers and broadcasters. Of the $1.2 billion of annual revenue the service brings in, nScreenMedia estimate $1 billion goes directly to programmers. Factoring marketing, streaming, and other costs the service is likely still well underwater.
Free not enough for Apple TV+
With a thin catalog of originals, Apple has been banking on new device buyers to pump up user numbers and create a buzz about its Apple TV+ SVOD service. New iPhone, iPad, and Apple TV purchasers receive a free year’s subscription to the service. The strategy doesn’t seem to be working.
Bernstein analyst Toni Sacconaghi estimates that fewer than 10% of eligible buyers follow through and activate their subscription. If Apple really wants to make a splash with Apple TV+, it will have to join the content wars in earnest and spend a lot more than the $6 billion it has committed to the service. A couple of Super Bowl ads might not go amiss either.
Quibi cranks up the advertising
Quibi, the premium mobile video subscription services, is set to launch on April 6th in North America. It is busy trying to educate consumers of its existence and why they should shell out $4.99 a month for the service to watch with ads and $7.99 ad-free.
In the spirit of education, the company decided to blow $5.6 million on an ad during the Super Bowl. The ad showed bank robbers in the commission of their crime watching video on their phones. The company is keeping the promotion going through its YouTube channel. It has also released three new trailers for upcoming shows starring Idris Elba, Kiefer Sutherland, and Will Forte. The trailers generated between 500 and 700 thousand views each in the first three days of availability.
TV news aplenty online
Traditional TV news providers are now fully engaged in providing similar services to online viewers. CBS was an early mover when it launched a 24×7 linear streaming news channel, CBSN in 2014. NBC announced it would launch a joint venture with Sky focused on world news in the summer of 2020.
Now ABC is getting more serious. It launched ABC News Live in 2018, primarily on the back of repurposed TV content. It is completely revising the approach. By the end of the year, it plans to have 18 hours of live and original programming every day available on the channel.
According to ABC, News live attracts 7 million monthly unique viewers and has been adding 1 million new viewers every quarter. Those viewing ABC News Live on connected TVs watch for 100 minutes per session, while mobile viewers watch for 40 minutes.