VIDEO INSIDER: Intel Bows Out - Aereo's Mainstream Moment - TV At The Pump

Welcome to our new Video Insider newsletter, a morning email with the top news and analysis on the digital video industry, produced by BI Intelligence.


INTEL BOWS OUT: Less than a year ago, Intel was making a big deal out of its plans to revolutionise TV with a set-top device that would make TV watching a much better experience. The company grabbed a lot of media coverage for its ambitious project, including a very long piece in Variety, back in April. Today, reports emerged that Intel is selling the subject of all that splashy coverage to Verizon, for a rumoured $US500 million. Intel Media, as the project was called, reportedly ran into trouble scoring content deals. (The Verge)

QUOTE OF THE DAY: “I was clear that this was not for the faint of heart.”

— Intel Media head Erik Huggers, back in April 2013, explaining how he presented his plan to revolutionise TV to Intel’s board. Intel is now selling Intel Media to Verizon. (Variety)

AEREO’S MAINSTREAM MOMENT: The long holiday weekend in the U.S. saw Aereo getting plenty of attention in the general media following news earlier this month that the U.S. Supreme Court would take up the case of whether the startup can legally take TV signals from the airwaves and stream them over the Internet to paying subscribers’ phones, tablets, and PCs. In The New York Times, Leslie Kaufman profiled how Aereo’s “tiny antennas” could topple the traditional TV industry, and dug into the background and personality of immigrant founder Chet Kanojia, who describes himself in the article as a onetime “back-bencher … who spent too much time smoking and drinking and too little time studying in his hometown, Bhopal (India).” Now, a different bench will decide Aereo’s future. It’s expected that the case will be argued in April.

A-E-R-E-O IN CINCINNATI: Meanwhile, Aereo is still expanding. It received $US34 million in new funding earlier in January. The $US8-a-month service also launches today in the Cincinnati area, which actually encompasses three states: Ohio, Kentucky, and Indiana. Aereo is now available in 11 metro areas in the United States. Jack Dominic, chief technology officer for Cincinnati’s public television station, described Aereo favourably in a blog post, “Aereo is not for everyone but does provide an affordable and innovative option for watching TV.” (Aereo, Jack’s Notes)

WELCOME, VIDEO INSIDERS:The Video Insider newsletter covers the day’s most important topics in digital video, as well as news exclusives of interest to industry insiders. We look forward to the newsletter becoming an important part of your morning routine.

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NETFLIX EATS PREMIUM CABLE?: Internet video streaming services like Netflix and Amazon Prime may be a bigger threat to premium channels like HBO, Starz, and Showtime than pay TV overall, according to new survey data from NPD Group. The percentage of U.S. adults that subscribe to these channels dropped six percentage points between March 2012 and August 2013, to 32%. At the same time, subscribers to Internet video services rose four percentage points to 27%. Variety’s Todd Spangler sought to add a grain of salt to the findings: “One big caveat to this report: The data does not demonstrate cause and effect. NPD did not ask consumers if they dropped premium cable TV services because they were switching to Netflix or other [streaming] options.” Meanwhile, the blog TV Predictions notes that some of these premium channels actually saw subscriptions rise during the period in question. (NPD Group, Variety)

MOBILE VIDEO ADVERTISING SURGES: Gartner was out with more research on the future of mobile advertising, which it says will drive $US18 billion in spending in 2014, up from $US13.1 billion last year. Gartner said that display formats will make up most of the revenue, but video will show the highest growth. Tablets will be the engine driving mobile video advertising. (Gartner)

WHY IS TIME WARNER CABLE PLAYING HARD TO GET?: Charter Communications wants to buy Time Warner Cable for $US37.4 billion, and has been spurned thus far. The tone of the acquisition discussions has turned increasingly nasty, with Charter executives accusing Time Warner Cable of a “failed operational strategy.” At The Motley Fool, Brandy Betz offers some evidence that Time Warner Cable is, in fact, a wounded beast. It’s dropping subscribers faster than peers like Comcast. (The Motley Fool)

THE BIG OUT-OF-HOME OPPORTUNITY: Earlier this month, Gilbarco Veeder-Root, a leading manufacturer of fuel pump and retail gas station technology, acquired Outcast Media, one of two leading companies that specialize in providing digital video content and advertising at the gas pump (Outcast’s main competitor is Gas Station TV). This may start a trend of retail tech manufacturers acquiring out-of-home video networks. Screenmediamag analyses the deal: “While Outcast doesn’t reveal the number of stations it currently broadcasts to, the number is probably around 2,000-2,500; but Gilbarco’s pumps are in 60,000, roughly half of all the forecourts in the U.S. And the pair are already talking about nearly trebling Outcast’s audience from 36m to 100m monthly viewers in just two years.” (Screenmag)

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