Multichannel News - June 01, 2020 by publications

MERGERS COULD SPUR AD TECH STREAMERS CONFRONT ‘CHANNELS’ CHALLENGE

WALLACE’S WORLDVIEW

Fox News anchor on how the election will shape up, and how the pandemic compares to other giant stories he’s covered

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IN THIS ISSUE

VOLUME 41 ISSUE 11 • JUNE 1, 2020 WWW.MULTICHANNEL.COM

FOLLOW US twitter.com/MultiNews www.facebook.com/MultichannelNewsMagazine CONTENT VP/Global Editor-In-Chief Bill Gannon, william.gannon@futurenet.com Content Director Kent Gibbons, kent.gibbons@futurenet.com Content Manager Michael Demenchuk, michael.demenchuk@futurenet.com Senior Content Producer - Programming R. Thomas Umstead, thomas.umstead@futurenet.com Senior Content Producer - Finance Mike Farrell, michael.farrell@futurenet.com Senior Content Producer - Washington John S. Eggerton, john.eggerton@futurenet.com Senior Content Producer - Technology Daniel Frankel, daniel.frankel@futurenet.com Senior Content Producer Michael Malone, michael.malone@futurenetcom Senior Content Producer Jon Lafayette, jon.lafayette@futurenet.com Content Engagement Manager Jessika Walsten, jessika.walsten@futurenet.com Assistant Content Producer Chelsea Anderson, chelsea.anderson@futurenet.com Contributor Paige Albiniak Production Manager Heather Tatrow Managing Design Director Nicole Cobban

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8 COVER STORY FEATURES 8 COVER STORY Chris Wallace has spent over 50 years in the news business but hasn’t seen anything like the pandemic. The Fox News Sunday host shares his views of these unprecedented times and the state of the news business, and talks about his new book. By Michael Malone 12 SPECIAL REPORT: ADVANCED ADVERTISING Big media players are making moves into AVOD, and ad tech firms are poised to reap benefits as connected TV use grows. Jon Lafayette 16 TECH Why the ‘channels’ strategy of over-the-top platforms like Amazon and Roku is proving challenging for direct-toconsumer offerings such as HBO Max. By Daniel Frankel

12 SPECIAL REPORT: ADVANCED ADVERTISING

16 T ECH

DEPARTMENTS

ONLINE

4 AGENDA 14 PROGRAMMING 18 POLICY 20 BUSINESS 22 FATES & FORTUNES 24 DATA MINE 30 VIEWPOINT 32 THE FIVE SPOT

TWEET CAUGHT IN A WRINGER? Follow online coverage of the president’s efforts to regulate Twitter and other social media at multichannel.com.

Vol. 41 No. 11 June 1, 2020. Multichannel News (USPS 590-190) (ISSN 0276-8593) is published semimonthly, except July, with additional issues in January and September by Future US, Inc., 11 West 42nd Street, 15th Floor, New York, NY 10036-8002. Subscription prices: U.S. 1 year, $199. Canada 1 year, $249. Foreign 1 year, $299. Prepayment in U.S. funds only. Please send subscription orders to Multichannel News, P.O. Box 1337, Lowell, MA 01853-1337, (888) 266-5828. Outside the U.S., call (978) 667-0352. Please allow three to four weeks for your subscription to begin or for changes to become effective. Periodicals postage paid at New York, NY, and additional mailing offices. POSTMASTER: Please send address changes to Multichannel News, P.O. Box 1337, Lowell, MA 01853-1337. Publications Mail Agreement No. 40612608. Printed in U.S.A. © 2020 by Future US, Inc. All Rights Reserved. Multichannel News® is a registered trademark of Future US, Inc.

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Fox News Channel (2); HBO Max

ADVERTISING SALES Director of Sales, Media Entertainment & Tech Laura Lubrano, laura.lubrano@futurenet.com Ad Director Paul Mauriello, paul.mauriello@futurenet.com Account Manager Katrina Frazer, katrina.frazer@futurenet.com Japan Sales Sho Harihara, Yukari Media Inc., 81-64790-2222 or mail1@yukarimedia.com

AGENDA

‘Match’ Clicks With Viewers Hungry for Live Events Woods-Mickelson telecast sets mark for golf on cable By R. Thomas Umstead thomas.umstead@futurenet.com @rtumstead30

urner Sports’ live telecast of a charity golf tournament featuring Tiger Woods, Phil Mickelson, Tom Brady and Peyton Manning scored big ratings numbers, continuing a trend of strong showings for the return of live sports events amid the pandemic. The May 24 The Match: Champions for Charity drew 5.8 million viewers across TNT, TBS, truTV and HLN, according to Nielsen. The event, which generated $20 million for COVID-19 relief efforts, was the most-watched golf telecast in cable TV history, according to Turner. The Match was one of a small-but-growing number of live sports events that have taken place since the pandemic forced the shutdown of most events in mid-March. Most have brought a large following of fans to TV screens. Fox Sports has averaged nearly 4 million viewers for its first three live NASCAR

telecasts, led by its first telecast since the pandemic broke out. The May 17 race at Darlington drew 6.3 million viewers on Fox — the second-best race performance this season for Fox Sports, according to Nielsen. ESPN has pinned down some impressive numbers for its live UFC telecasts. The sports network averaged more than 1.2 million viewers for the main card of UFC Fight Night: Overeem vs. Harris on May 16 after generating a reported 700,000 pay-per-

A cumulative 5.8 million viewers watched Phil Mickelson, Tom Brady, Peyton Manning and Tiger Woods tee off in The Match.

view buys on ESPN Plus for UFC 249 on May 9. With most live sports sidelined since March due to the coronavirus outbreak, industry observers say sports fans have been salivating for live sports events, whether or not they were big fans of the sport being televised. “The audience for televised sports is not going away. If anything it’s getting larger and perhaps more passionate because they miss what they haven’t been able to see during the past few months,” sports analyst Lee Berke said. More sports are making their way back to television, sans live audiences: pro bowling, auto racing events and a potential boxing match are on deck for June, with plans announced for the National Hockey League to conduct a Stanley Cup Playoffs tournament and Major League Baseball negotiating with the players about starting a shortened season. Berke said demand for live sports events will only increase. “You can’t go out to games, you can’t go out to shows, you can’t go to the movies, so the audience is starving for live events and content,” he said. “If sports can be brought back safely there’s a ready-made, large audience ready to watch.” ●

Turner Sports; Scott Clarke/ESPN Images

DirecTV Offers Subs Credit For Missed Sports Packages

With pro sports still in mothballs due to the pandemic, including big-league baseball and soccer, DirecTV said it will be giving its customers a break on the MLB Extra Innings and MLS Direct Kick out-of-market pay packages. DirecTV owner AT&T posted the news on its COVID-19 update website, adding that rebates it gets from programmers whose sports it paid for will be provided to customers. “With the professional baseball and soccer seasons postponed or suspended, our customers who subscribed to MLB Extra Innings and MLS Direct Kick will receive credits for any payments already made toward their subscription and we have postponed future charges until we learn more from the leagues,” the company said. For subscribers who may not prefer the version of either sport when it resumes under social distancing, it is providing the option to decide whether they

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want to cancel the subscription two weeks into those sports’ respective returns. “We continue to monitor the situation closely and are in contact with programmers and sports leagues as they plan their next steps,” AT&T said. “Any rebates we receive from programmers and sports leagues will be provided to our customers.” Cable and broadband providers have been under some pressure to cut their subs a break, though they have been putting similar pressure on programmers to do the same given the rights fees they charge that are then passed on to customers. AT&T was one of the companies New York Attorney General Letitia James wrote to last month asking them to provide COVID-19-related relief by cutting or dropping live sports-related fees, saying it and others “must prepare and provide a plan for “appropriate refunds, discounts and reductions of charges and fees, payment deferrals, and waiver of

DirecTV said it would send some money back to its MLB Extra Innings subscribers. termination fees, at least until live sports programming is resumed.” — John Eggerton

AGENDA

THE WATCHMAN

WATCH THIS …

Senior content producer Michael Malone’s look at the programming scene

Below Deck Mediterranean On Monday, Below Deck Mediterranean starts on Bravo. It is season five, the new episodes are “shocking,” said Bravo, and it is set in Mallorca, Spain. Dirty John: The Betty Broderick Story begins on USA Tuesday. Amanda Peet and Christian Slater play scorned lovers as their marriage dissolves into a messy divorce and then a double homicide. Season four of 13 Reasons Why debuts Friday on Netflix. High school student Clay Jensen lands smack in the middle of a series of heartbreaking mysteries

Gordon Ramsay: Uncharted

By Michael Malone michael.malone@futurenet.com @BCMikeMalone

National Geographic/Justin Mandel; Sony Pictures Television; Karolina Wojtasik/Bravo; David Moir/Netflix

Gordon Ramsay Is Off the Charts

Season two of Gordon Ramsay: Uncharted begins on Nat Geo June 7. The show sees Ramsay traverse the globe seeking out culinary inspiration. He ventures to Tasmania, South Africa, Norway and other exotic destinations. “We find weird places and weird people and throw Gordon in there,” executive producer Jon Kroll said. “He turns it into television gold.” To Ramsay, local flavor is as much about residents as ingredients. “We get the opportunity to learn from the locals and hear their stories, and that gives us a much deeper experience and understanding of the world around us,” Ramsay said. Indonesia is a highlight, said Kroll, with great food and memorable residents. “It’s the most Uncharted bang for your buck this season,” Kroll promised.

L.A.’s Finest Multichannel.com

Also up there is Sumatra, where Ramsay ran with some bulls, and Tasmania, where people “definitely have a bit of a screw loose,” Kroll said. In Tasmania, the host, and producers, sample a local whiskey smoked in sheep poop. In Guyana, Ramsay joins the locals in hunting caiman by hand, and in South Africa he was stalked by a rhino and a couple of hippos. “It’s been all we can do to keep that man alive,” Kroll said.

‘L.A.’s Finest’ Goes Wide Season two of L.A.’s Finest premieres on Spectrum Originals June 8. Gabrielle Union and Jessica Alba play partners in the LAPD. The show was inspired by Jerry Bruckheimer’s Bad Boys franchise. Fox revealed it will air L.A.’s Finest in the fall. The producers are stoked to have the show in front of many more viewers. “There’s no better feeling than to have the show we made, that we’re incredibly happy with, to now have the opportunity to have it seen by millions more viewers,” executive producer Brandon Sonnier said. L.A.’s Finest, from Sony Pictures Television, was initially a pilot at NBC before shifting to Spectrum Originals. Now it’s headed back to broadcast. “It’s just been a wild journey,” executive producer Brandon Margolis said. The Brandons said the series stepped outside the network procedural structure when it moved to cable, making for a more unique viewing experience. It also offers a couple big names in the lead roles. Union plays Syd, who departed the DEA to join the LAPD, and Alba plays Nancy, who is dealing with a rebellious teen-age stepdaughter. Whether their first names were an homage to 1986 punk biopic Sid and Nancy has not been confirmed. Bruckheimer executive produces L.A.’s Finest. “What you get when you put movie stars on the show, and Jerry Bruckheimer, is motion picturequality entertainment,” Sonnier said. “It’s like a real action movie in your living room.” ●

Dirty John following a friend’s suicide. Dylan Minnette and Katherine Langford star. Sunday, I May Destroy You premieres on HBO. Michaela Coel executive produces and stars (see Review, page 14). HBO calls it “a fearless, frank and provocative series that explores the question of sexual consent in contemporary life and how, in the new landscape of dating and relationships, we make the distinction between liberation and exploitation.”

13 Reasons Why

Fox News Channel

COVER STORY

Chris Wallace has pivoted from in-person interviews with newsmakers such as Russian president Vladimir Putin to video calls with pols like Colorado Gov. Jared Polis (r.).

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CHRIS WALLACE’S SUNDAY BEST After more than 50 years in broadcasting, esteemed anchor hasn’t seen anything like the pandemic By Michael Malone michael.malone@futurenet.com @BCMikeMalone

hris Wallace is the anchor of Fox News Sunday. He joined Fox News Channel in 2003 and is based in Washington. Before joining Fox, Wallace spent 14 years at ABC News. Prior to that, he was chief White House correspondent for NBC News and moderated Meet the Press in 1987 and 1988. Fox News Sunday is averaging just shy of 5.2 million viewers this year and 1.1 million in the 25-54 demo (across showings on both Fox and Fox News Channel). The son of famed newsman Mike Wallace, Chris has written Countdown 1945: The Extraordinary Story of the Atomic Bomb and the 116 Days That Changed the World. The book is available June 9. Wallace spoke with Multichannel News about where the idea for the book came from, how the pandemic compares to other stories he’s covered in his long career, and how the presidential election may shape up. An edited transcript follows. MCN: In your time in the news business, have you ever seen a story like the pandemic? Chris Wallace: No. Not only have I never experienced something like this, I never imagined anything like this.

I’ve covered wars. We’ve covered 9/11. But the idea of a pandemic — that’s something you read about. The Black Plague, the Flu of 1917. The idea that the country and the world largely shuts down and the economy would come to a crashing halt because of a virus — in this day and age, with all of the biotechnology and all of the science, it never occurred to me this could happen. I hate it, but I suppose that’s one of the reasons we get into the news business, to cover stories we never imagined. And this is certainly one of them. MCN: You’ve been hosting Fox News Sunday from your home. How has that changed the program? CW: It was awkward the first week or two just because it’s different and I’d never done it that way. But we’re adaptable animals and the thing that surprises me now, in week eight or nine or whatever it is, is how routine it has become. The only thing I don’t like is, I don’t get to do any of the interviews in person. We often did interviews by satellite because people just aren’t in Washington. I always prefer to do an interview in person. You interact more, you have physical cues in addition to verbal cues, you’re able to connect more with the person. Now, one, it’s satellite, and two, it’s satellite oftentimes with a delay, and that makes it harder. MCN: Where did the idea for the book come from? CW: I wanted to do a deep dive on a key moment in American history. Total nonfiction, but almost turn it into a novel in a sense that I was going to take a very precise period of time and delve into the characters, the anecdotes, what they were wearing, almost make it like a novel. All true, absolutely solidly researched, but it would have the feel of an adventure story. But I didn’t have the idea as to what I wanted to do. In February 2019, it was the day that Donald Trump was to deliver the State of the Union address. A number of anchors were invited to the White House for lunch, where he’d preview the address. Then four or five of us were invited by Nancy Pelosi to the Hill, where she would do what is called the prebuttal — she was going to say everything that was wrong with the president’s speech before he even delivers it.

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COVER STORY

We’re in this room in the Capitol, this small, ornate room on the House side. She said, this is the Board of Education. I don’t think most of my colleagues knew what it was but as a student of history, I did. The Board of Education was a secret hideaway. When he was Speaker of the House in the ’40s and ’50s and ’60s, Sam Rayburn — he was from Texas and was known as Mr. Sam — used it as his hideaway. He would invite members of Congress or political cronies to come after hours to sit and have a drink, usually bourbon and branch water, and gossip about politics and discuss strategy. I was very excited to be in the Board of Education. [Pelosi] then proceeds to tell a story. She said it was in this room in April of 1945 that Truman, [then] the vice president, got the call that FDR had died. She said Truman talked to the White House, gets the word, hangs up the phone and says, ‘Jesus Christ and General Jackson.’ I thought: ‘I got it! That’s it! That’s the first chapter of the book!’ Harry Truman becomes the president and 116 days later, he drops the bomb on Hiroshima. That was the idea for the book. It turned out she was slightly wrong. Truman was not told FDR had died. He was told he needed to get to the White House right away. But he did say, ‘Jesus Christ and General Jackson.’ MCN: What are your prime sources for news consumption?

Fox News Channel

Chris Wallace sat down last September with Iranian president Hassan Rouhani.

CW: I still read a number of papers every day. The only difference is, I don’t get them physically, which bothers me. One of my joys is to open the front door, walk down the stoop and pick up the newspaper. I don’t do that anymore. I don’t want to have to disinfect it. I do everything online. I’ve become very impressed, and I know this sounds terribly old-fashioned, with how interesting the online editions of newspapers are — there is a lot of additional content. That’s been a discovery for me. I routinely go online anyway and look at various websites and blogs and newsletters. I watch Fox News. I always watch one evening newscast a night as well, because I’m a big believer in getting your news from multiple sources. People ask me what they should do as a news consumer, and I say, don’t just watch Fox, don’t just read The New York Times. Consume news every day that’s different from your main source and perhaps challenges your preconceptions. That allows you to be a more informed news consumer. It’s almost like a GPS triangulation system where you’re able to see different approaches to the news and figure out what you think is the truth. Multichannel.com

MCN: In terms of evening news, is there one you watch or do you rotate? CW: I like NBC and Lester Holt. MCN: Tell me about a story you did that made you particularly proud. CW: I did an extensive interview, a very hard-hitting interview, with [Russian president] Vladimir Putin in July 2018 in Helsinki, right after his summit with President Trump. I was especially proud because I confronted Putin with a lot of questions about meddling in the 2016 election that apparently President Trump didn’t raise. That was a good, serious, tough, news-making interview. I was also very proud of the interview I did with [former FBI director] James Comey [in December]. It was right after the Inspector General report came out and said the FBI did a very sloppy job getting FISA warrants to surveil Carter Page, who had been a member of the Trump campaign. I think a lot of people in the mainstream media went very easy on Comey. I gave an FBI interrogation to the former head of the FBI. MCN: Why is Fox News home for you? CW: I was at ABC in the early 2000s. People used to talk about managing the decline, that the best days of network news were behind them and we were gonna get smaller. Like a lot of newspeople, I had a TV on in my office all day. It’s on mute, but if there’s breaking news I want to see it. When you work at a broadcast network from nine in the morning to 6:30 at night, it has to be on cable. If it’s on a broadcast network, you’ll see game shows or soap operas or talk shows. It seemed, day in and out, cable news was the only place in town. I was particularly intrigued by Fox News because I thought they did some of the most interesting, inventive, engaging news coverage, particularly in the news hours, as opposed to the opinion hours. Not that I’m against the opinion hours, it just doesn’t interest me as much. I met with Roger Ailes in spring 2003 and he was a fan of my interviewing style. I was very clear to him. I said ‘Roger, I’m not going to push an agenda, I’m not going to pull my punches. I’m a newsman.’ He said, ‘That’s exactly what I want you to be. Make me one promise — you’ll be as tough on one side as you are on the other. You’re not going to favor one side.’ I said, ‘That’s in my DNA. I’m a contrarian.’ From that day to this one, first under Roger and now Rupert and Lachlan Murdoch, never once have I been second-guessed about a question I asked or a guest I booked. They just want me to play it straight and I have. I feel the complete support of the bosses at Fox News. I find it a great place to work and I’m very proud to be part of it. MCN: How nasty do you see the election getting? CW: It’s going to get nasty. Trump is a tough customer. I’ve seen it in the way he treats rivals, I’ve seen it occasionally in the tweets he writes about me. He’s a New York real estate guy and that’s not the easiest, gentlest world to grow up in. So I expect him to be plenty tough. I don’t know about Biden, but the Democrats just plain don’t like the president. So I expect it to be a very tough, hard fought and nasty campaign. ●

Consume news every day that’s different from your main source and perhaps challenges your preconceptions. — Chris Wallace, anchor, Fox News Sunday

SPECIAL REPORT: ADVANCED ADVERTISING

AVOD Acquisitions Could Spur Advanced Advertising Consolidation could put squeeze on some ad tech players By Jon Lafayette jon.lafayette@futurenet.com @jlafayette

Xumo

dvanced advertising could accelerate with the acquisitions of the top free streaming video services by larger, traditional media companies. “Connected television is the undisputed winner of this period,” Tal Chalozin, chief technology officer and co-founder of Innovid, said. Media buyers are encouraged by the networks getting infused with new technology and innovations. Some tech firms also see opportunity as bigger advertisers grow more comfortable with buying over-the-top and connected TV from familiar faces. Others, though, warn the industry is still ripe for consolidation and for more middlemen to be eliminated from the tech stack to make advanced advertising work more efficiently. “I think that what, if anything, is going to squash innovation, it's frankly legacy ad tech,” said Chris Maccaro, CEO of ad tech firm Beachfront Media. “If you’re a big media company or a big ad tech company and you don’t have a capability right now, you could talk about building it

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yourself,” Andre Swanston, CEO of OTT audience measurement firm Tru Optik, said. “But by the time you do, you’re irrelevant.” Spurred by the COVID-19 pandemic, more viewers are going over the top, and the hours spent watching free, ad-supported video-ondemand services and apps have skyrocketed, attracting the attention of advertisers and their media buyers. Big media companies, which are losing viewers and subscribers, have noticed, too. In March, Fox bought ad-supported VOD programmer Tubi for $440 million and Comcast bought AVOD firms Xumo and Vudu for undisclosed amounts. Those deals came after Viacom last year bought Pluto TV, another AVOD programmer, for $340 million. Pluto has technology that can help ViacomCBS compete in a streaming future. “Pluto has done an incredible job programmatically,” David Lawenda, executive VP for sales, digital video and interactive at ViacomCBS, said. “They’ve done a terrific job of monetizing that way. Both sides have leveraged each other’s strengths to make the overall offering stronger.” Will ViacomCBS bring Pluto’s tech in-house and stop working with other platforms? “We haven’t made that call yet,” Lawenda said. “I don’t think the middlemen are going away. The larger ad-tech players will adapt their stacks for connected TV, either by acquisition or by

listening to the market and building what’s needed. It’s just going to take a little time.” Similarly, Tubi’s ad sales team will report into Fox ad sales and be a part of upfront deals. But Tubi will continue to sell inventory on other platforms. “You can’t isolate a market or try to control it,” Fox president of ad sales Marianne Gambelli said.

Consolidation a Boon to Buyers

Comcast’s AVOD acquisitions included Xumo.

Buyers think their clients will benefit as consolidation cleans up some of the industry’s fragmentation and media firms get a technology injection from the streamers they acquire. Dealing with established media partners, rather than digital upstarts, helps. “The more we can get closer to the content owners and the inventory owners, the better,” Jessica Brown, director, digital investment at GroupM, said. Big media companies may start to cut out some of the middlemen in the digital video advertising sales and serving business. “The more in-between players, the more room there is for fraud or piracy, all the things we don’t want,” Brown said. Consolidation also raises the chances that industry-wide challenges, including accurate audience measurement, will get solved quickly. The upstarts are more automated and their platforms were built for advanced advertising. Acquiring these upstarts gives the legacy media companies not only a bigger footprint in the CTV space, “but also the innovation, the access to the people who built that stuff the engineers write the product people because they know that that's where the growth is going to go,” Matt Kramer, managing director of advanced advertising at Omnicom Media Group, said. While AVOD offers advertisers opportunities to use data and address individual viewers, Kramer said those capabilities still need to be operationalized. “It's not an area that is easy to plan against to optimize and to measure.” When Tubi and Pluto were on their own, “they were probably more willing to do more for us so that they could get our ad dollars,” Kramer said. Ownership changes should spur more demand for connected-TV advertising. That means that even though many media companies are building their own proprietary tech stacks and data capabilities — Comcast owns FreeWheel, AT&T owns Xandr, Verizon has Verizon Media — there should be more money for everyone in the advanced advertising ecosystem, Kramer said. “Those who control the pipes and the data are the ones who win, right?” Kramer said.

SPECIAL REPORT: ADVANCED ADVERTISING

ViacomCBS execs say Pluto TV’s technologies position the company for a streaming future. “And so I know that the big media companies understand that, [and so] I’m sure we’re going to continue to see investment in that area.” Mike Laband, senior VP of platform at SpotX, sees all of the mergers and acquisitions in the advanced advertising space as an opportunity. “As advertisers go after this inventory via programmatic channels, I do believe that [supply side platformns] and [demand side platforms] will continue to grow,” he said. SpotX’s platform provides the digital pipes that help deliver the ads to the right places and upgrades them as market needs change. “That's going to be a heavy, heavy load to take on, to control that and be able to own that completely,” Laband said. “So, I think, why own it when you can rent it?” Some capabilities will move in-house. “That could happen down the road,” Laband said. “It’s not something that we’re seeing specifically today, though.” Some tech companies think the industry will have to move faster and legacy technology is holding it back. “We live in a world of amazing technology, but for some reason the TV industry can’t figure out how not to show the same ad twice in a row,” Adam Helfgott, CEO of programmatic ad firm Madhive, said. “It’s not a technology problem. It’s a legacy technology problem. “COVID has even traditional players now rethinking how they transact in media,” Helfgott added. “The upfronts are changing. You’re going to see more revenue moving to spot [sales] at least over the next year. You have a lot of people looking at the cost. They have to support the manual sales process. “Who loses are people that are remarketing decade-old technology with new product names on top of infrastructure that’s 15 years old,” Helfgott said. “There is a lot of underlying architecture that just doesn’t allow the features buyers are going to require as they get more and more sophisticated.” Added Beachfront’s Maccaro: “As you look at what’s going to squash innovation, legacy ad tech is the biggest barrier right now.” SpotX’s arrangement with publishers sometimes gives that company’s bids a priority status, Maccaro said, resulting in higher bids not getting considered. Beachfront recently introduced a pod-bidding system that Maccaro said puts all bidders on a more equal footing. “We’ve run into a half a dozen publishers right now that have said, ‘Listen, SpotX is our biggest SSP. We love your solution but SpotX is telling us they can’t integrate with a third-party pod-bidding solution.’ ”

Maccaro said the pod-bidding system is open source based on pre-bid specs and that SpotX is a board member of the Pre-bid.org organization. “And they’re telling publishers they can’t integrate with our podding solution because it’s a technical problem. What they’re doing is they’re protecting this legacy waterfall.” Responding to Maccaro, SpotX’s Laband said: “We’ve found that some existing technology layers do not scale well in high-concurrency OTT environments and they add latency. A direct integration with the media owner’s SSAI solution or ad server is a preferred path for SpotX, due to the elimination of multiple tech layers in between the source of the inventory and the end buyer. “SpotX is focused on bringing premium, broadcast-ready solutions to market for our customers,” Laband added. “Additionally, SpotX maintains its commitment to inventory quality assurance to our buyers and premium OTT media owners, which means we enforce very strict brand safety and security requirements on what platforms can interact with our technology.”

Solving Bidding Issues

Travis Hockersmith, VP of platform services at smart-TV maker Vizio, said that most of the issues in making the bidding process fair and assuring revenue optimization can be solved. “If everyone has full transparency into where the ad calls are going and into the ad decisioning on how to fill pods, I’d say 90% of the disputes that I’m aware of in the space would disappear,” Hockersmith said. “Right now, there are so many ad-tech black boxes and there's a financial incentive for those black boxes to exist because if you can control the data and the other side can't see the data, you stand to win financially,” Hockersmith said. “All of the disputes start from a position of mistrust. So, I think 100% transparency solves 90% of the problems.” As the market develops there will be winners and losers. “It’s the ones that conduct their business in a transparent way” that will be the winners, said OMG’s Kramer. “They have the audiences that we’re looking for. They have the quality of the media that we’re looking for and they’re just going to be good partners to us and our clients. The business remains the same, you know, having a firm handshake, an ethical and responsible relationship and serving great ads in great media. The strong players will remain the same as long as they follow those guidelines.” ●

Fox acquired ad-supported streaming service Tubi in March, but the programmer is already bringing it to market in the upfront conversations it’s having with clients. “Tubi was the perfect complement for our set of assets,” said Marianne Gambelli, who became president of Gambelli ad sales after The Walt Disney Co. bought 21st Century Fox last year, leaving a “new Fox” consisting of the Fox broadcast network, Fox News and Fox Sports. Clients could potentially still buy their mass media on Fox’s broadcast and cable assets, and do more precision marketing to more tightly targeted consumers via Tubi. “We were mostly focused on linear, so it rounded out our portfolio, giving us the younger audience, giving us the tech and the addressable inventory that we didn’t really have in the assets that remained at new Fox,” Gambelli said. “So it was actually a strategic purchase that made 100% sense helping us expand our portfolio in the marketplace.” Fox has been bringing Tubi to media buyers as part of its upfront conversations. “Every client that we've kind of talked to is very excited about it,” Gambelli said. “This space is exploding. It’s younger, and there’s less commercialization. I think we’ll learn about that and maybe we migrate some of that innovation to Fox. Addressable is obviously becoming more important as data becomes more available and more actionable.” Since Fox acquired it, Tubi has been adding content, including The Masked Singer, now the most popular show on the platform. It may also be adding local content from Fox stations in some markets. Tubi ad sales are led by Tubi’s chief revenue officer, Mark Rotblat. He reports to Gambelli just like the executives in charge of selling the company’s news, sports and entertainment verticals. Because of its content, it will be most closely aligned with the entertainment vertical, Gambelli said. The idea is to give Tubi its own focus, but at the same time, it fits nicely into different parts of Fox, Gambelli said. Fox intends to take advantage of Tubi’s technology and the relationship it has with its viewers. “They know their audience. As they learn your behaviors, they serve up content that they know you’re interested in,” she said. “You’re going to see what Fox does best in terms of content end up on Tubi but again keeping Tubi’s customer-focused experience.” In this business environment, more targeted media might be an easier sell to advertisers. “It’s easier to justify because it’s targeted and you know you’re reaching that customer” and can demonstrate return on investment, Gambelli said. — JL

Tubi

Pluto TV

GAMBELLI SAYS TUBI ROUNDS OUT FOX’S MEDIA ASSETS

Multichannel.com

PROGRAMMING

‘Unsung’ Carries Its Tune Into Black Music Month TV One docuseries fast-forwards to ’80s, ’90s as it readies a new season REVIEW

I MAY DESTROY YOU

By R. Thomas Umstead thomas.umstead@futurenet.com @rtumstead30

une is Black Music Month, and few cable shows embody the celebration of African-American musical artists more than TV One’s long-running Unsung. In its recently concluded 14th season, the docuseries — which has profiled performers ranging from Teddy Pendergrass to Rick James to DeBarge — finished as the network’s most-watched series and the mostwatched show during its Sunday 10 p.m. time slot among African-American viewers, according to Nielsen. With a new season already in the works, Unsung executive producer in charge of production Jason Ryan spoke to Multichannel News about the A. Smith & Co.-produced show’s longevity, as well as its strategy to attract younger viewers while remaining relevant to its core audience of adults 25-54.

MCN: How has Unsung helped to define TV One’s brand? Jason Ryan: Unsung is our longest-running and our award-winning series. It’s one of those series that defines the network: People know TV One for Unsung just because it’s been running for so long. We get such a great response from fans and viewers, and many of the artists that have participated over the years have been really excited about being a part of the show.

Steve Granitz/WireImage/Getty Images

MCN: What has the show done to help influence the business of music? JR: It’s really important to provide a platform that really tells the story of influential black artists in this intimate type of setting. We

Jason Ryan Multichannel.com

(Premieres Sunday, June 7, 10:30 p.m., HBO)

celebrate their music, but we also tell their story. It’s just a really impactful platform, not only for the network but also culturally. Most of the time we hear artists when they are performing at a concert or they’re interviewing about a new project. This is a way to get into their story and give them a platform that you rarely see in the mainstream. MCN: After initially focusing on artists from the ’60s and ’70s, more recent seasons of Unsung have also featured ’80s and ’90s artists. Has that introduced the series to a new generation of viewers? JR: Incorporating some of those more-recent artists has helped broaden the scope of the show. Early on, it was more ’60s and ’70s artists, but as we’ve introduced some ’90s artists, those episodes have been received very well. As the show goes on through the years and we begin to separate from the eras, we can go back to those artists in the ’90s and 2000s because the show has been on for so long. That allows us to choose from an even larger pool of artists for future episodes that are more familiar to younger viewers. MCN: Are you looking to make any changes to the format going forward? JR: We’ve been talking long-term about some ways to tweak the show and make it stronger, but in the end it’s the artists and stories that make the show stand out. For the first time this past season, during our Dru Hill episode, we added an Unsung digital element in which an artist that’s featured performs a song live. For us, it’s not so much about changing the show, but more about evolving the show so that we can further engage the viewer and the artists. ●

More recent seasons of Unsung have focused on 1990s acts like rappers Dru Hill.

Actress and producer Michaela Coel (Netflix’s Chewing Gum) delivers to HBO a provocative comedy/drama/mystery series that tackles the issues of dating and sexual consent in today’s society. Set in London, I May Destroy You stars Coel as Arabella Essiuedu, a rising Londonbased internet author who is set to pitch her first book manuscript. Resigned to pulling an all-nighter in order to meet a morning deadline with her agent, she eventually decides to take a much-needed break to meet some friends for drinks at a local club. What initially begins as a fun, relaxing experience turns out to be unnerving for Arabella the next morning, as she can’t remember parts of the previous evening. A cut above her forehead and a cracked cellphone, along with bank charges and withdrawals that she doesn’t remember, lead Arabella to believe she may have blacked out from a spiked drink and to worry about what else may have happened to her during that period of time. The series revolves around Arabella trying to piece together her fateful evening. Her dogged pursuit of the truth also leads her to begin taking inventory of her own life choices as well as the people within her inner circle — including friends Terry (Weruche Opia), Simon (Ami Ameen) and Kwame (Paapa Essiedu) — to determine who truly has her best interests in mind. Coel isn’t afraid to challenge the status quo on casual sex, monogamous relationships and sexual consent, which she clearly establishes within the first few episodes. Coel deftly introduces Arabella’s care-free personality into a much broader tale of contemporary dating and relationships that builds into an interesting and infectious storyline. Coel smoothly interjects comedy, drama and mystery elements as Arabella’s own personal journey evolves throughout the 12-episode series. I May Destroy You is a co-production of HBO and the BBC. — RTU

TECH

‘Channels’ Pose a Challenge For Media Firms Going DTC Roku, Amazon battle with content firms over revenue splits, control By Daniel Frankel daniel.frankel@futurenet.com @dannyfrankel

s AT&T and its WarnerMedia division made the frantic final preparations to launch HBO Max on May 27, somehow coming up with original shows amid pandemic studio shutdowns and lining up vital distribution partnerships, one remaining obstacle proved intractable: app support for the most popular connected TV devices in the American living room. At press time, HBO Max still hadn’t established app support for the top OTT device platforms in the U.S., Roku and Amazon Fire TV. According to statistics released by research company Conviva last year, Roku controlled around 43% of connected TV use in the U.S. versus 18% for Amazon Fire TV. Both companies claim around 40 million active users worldwide for their OTT ecosystems, which not only populate the boxes and HDMI dongles that plug into TV sets, but also the native operating systems of many smart TVs. Roku and Amazon are disputing how market shares precisely break down in specific regions. Most everyone, though, agrees that Roku and Fire TV collectively comprise more than 50% of streaming in U.S. living rooms. That’s certainly an issue for AT&T, which had made earlier deals to have the HBO Max app included on Apple TV and Android TV OTT devices and empowered smart TVs, as well as Microsoft Xbox and Sony PlayStation video game consoles. So what’s the hangup with Roku and Fire TV?

HBO Max

Echoes of Disney Plus

It turns out that HBO Max’s plight with the top OTT device makers is very similar to what The Walt Disney Co. experienced late last year when it launched Disney Plus. In fact, a deal to include Disney Plus on Fire TV devices wasn’t announced until Nov. 7, just five days before the boffo launch of the service. Disney had to fight like heck to keep Amazon from “disaggregating” Disney Plus content into its own Amazon Prime Video Channels app, according to LightShed Partners analyst Richard Greenfield. Launched in 2015, Amazon Prime Video Channels is Amazon’s groundbreaking aggregated streaming video service. The tech giant Multichannel.com

repackages and resells dozens of popular subscription streaming platforms, controlling the customer relationship, including billing and which app the viewer uses to watch the show. The “channels” model has proven so attractive for Amazon that Roku and Apple have copied it. While they give up a lot to Amazon, SVOD services are able to get wider distribution than they would on their own. Some services access as many as 45% of their customers through Prime Video Channels. But it isn’t for everyone. As Greenfield noted in a recent blog post, the whole reason big media companies like Disney and AT&T choose to launch direct-toconsumer services is to, well, have a direct relationship with their consumer. Ultimately, Disney managed to gain Amazon Fire TV app support but, like Netflix and Hulu, it refused to let Amazon process and resell Disney Plus through Prime Video Channels. (As Greenfield noted, it does allow Apple TV Channels to include Disney Plus programming in its app. But once users select Disney Plus programming, they’re booted out of the Apple TV app and sent to Disney Plus.) AT&T and Amazon are probably arguing about similar things, with the dynamics complicated by the legacy HBO Now streaming service. Notably, it was the distribution success of HBO Now that inspired a wave of other SVOD services — everything from CBS All Access to Acorn TV — to sign onto Prime Video Channels five years ago. With AT&T already having an existing

HBO Max launched highlighting library shows like Friends and The Big Bang Theory, and originals such as Love Life starring Anna Kendrick.

SVOD service entrenched into Prime Video Channels, let’s just say the negotiations between AT&T and Amazon have been complicated.

Complex Talks

“A new subscriber to HBO Max or an existing HBO Now subscriber who is automatically upgraded to HBO Max at launch, via the Amazon Prime channel store, would only be able to watch legacy HBO content via the Prime Channel platform and would need to download the HBO Max app separately to watch content that is exclusive to HBO Max (catalog such as Friends and The Big Bang Theory, original series and movies),” Greenfield wrote, citing just one complication of an AT&T-Amazon deal. “We believe Amazon looks at that consumer experience as subpar and overly complicated. We agree.” AT&T’s negotiating dynamics were reportedly similar with Roku, which is also now in the business of reselling/aggregating subscription streaming services. At press time, a deal with Roku was said to be much further along than one with Amazon. An encouraging sign: AT&T negotiated the return of its AT&T TV app to the Roku Channels Store. The AT&T TV app, which houses the AT&T TV Now virtual pay TV service, had been unavailable for download since the beginning of the year. Its return to Roku Channels was seen as an indicator that Roku and AT&T would hash out an HBO Max distribution agreement by May 27. ●

POLICY

Mike Rogers, Man of 5G Action Former House intel chair’s group pushes hard to free up spectrum responsibly By John Eggerton john.eggerton@futurenet.com @eggerton

s chairman of the selfexplanatory 5G Action Now advocacy group, Mike Rogers, the former Michigan Republican congressman and chairman of the House Intelligence Committee, has been pushing hard for freeing up spectrum for 5G, including most prominently for the C-band spectrum, used for satellite delivery of TV signals, that the Federal Communications Commission is opening up for WiFi. It is all about beating China in the race for next-generation wireless supremacy, which means Rogers is also laser-focused on protecting the 5G supply chain and finding a way to wean it from reliance on suspect tech, most prominently Huawei and ZTE, though he thinks the government should help those companies disengage. Rogers has said the COVID-19 pandemic has shown the problematic nature of China in the supply chain. As he prepared to testify before the U.K. Parliament about securing 5G networks, Rogers spoke with Multichannel News about the challenges and importance of winning that race.

Getty Images

MCN: Why is freeing up C-band midband spectrum so important in the race to 5G? Mike Rogers: It is really the ‘Goldilocks’ spectrum. It has the best properties for efficient use of 5G technologies. Anything else adds latency and expense. The C-band is critical if we are going to compete both nationally and internationally to get the innovation surrounding 5G, and then to open it up to allow it to be used for 5G deployment.

MCN: You are all about winning the race to 5G. Why is that so important? MR: I think the COVID-19 supply chain issues have shone a very bright light on why this is so important. There were certain medicines that the Chinese decided to restrict or that they had and weren’t going to give up even though they had contracts with U.S. companies. Same with PPEs, the personal protection equipment. This, I think, clearly demonstrated why those of us who have been concerned about a secure 5G supply chain have said it is really important that we don’t have the [Chinese] Communist Party controlling data that traverses around the world. That is why we have to win this. Just as in 4G, when you could finally be on an airplane, Multichannel.com

order a shirt and have it sent to your house. If you think how important 4G was to commerce and how it exploded the use of the internet, that is what 5G is going to be for the ‘internet of things.’ Every device that is connected, from your HVAC system to manufacturing to connected cars and telemedicine, is going to be connected with these sensors. So that is going to be a tremendous economic boon for whoever controls this, No. 1. And, by the way, you want it to be secure and you want the competitive advantage to go to countries that play by Western values. Clearly, China has shown they have not played by those values in the COVID-19 epidemic. MCN: Sen. John Kennedy (R-La.) says the Intelsat bankruptcy proceeding means the FCC should rethink the C-band auction. Is he wrong? MR: I do think he is misguided on this, for sure. These are the companies that have invested billions of dollars and have U.S. employees and were given licenses to this spectrum some 20 years ago when nobody cared about it and they invested in what it

The U.S. and China are competing to win the race for nextgeneration wireless supremacy.

took to be successful using this spectrum that was licensed to them by the federal government. These are the same companies that filmed the first American touching down on the moon that I looked at as a young kid on a black-and-white TV. I do think if you are going to arbitrarily say we are going to take that back and do something else with it, because we gave them the license and expected them to do something with it and they did, then at least make it right. Are they going to get all the spectrum [auction] money? I don’t think that would be appropriate, and neither do they. But some balance is appropriate. Yes, Intelsat has filed for bankruptcy. I think they are going to come out stronger on the other end of things. But that doesn’t mean that the government should take something from a company that was playing by the rules given them. And by the way, doing all that just makes it that much more complicated to clear that spectrum and get on the other side where we are actually competing and beating the Chinese to 5G development. MCN: So this is not just about helping those satellite companies, but also

“The C-band is critical if we are going to compete both nationally and internationally to get the innovation surrounding 5G.”

POLICY

MCN: That is a good segue to the issue of Huawei and scrubbing suspect tech from the 5G supply chain. But that is going to take a while given that company’s prominence in the 5G supply chain. Is there anything that can be done in the interim? MR: Yes. The government has set some pretty clear rules and within a year is going to identify equipment that poses a security risk and must be immediately removed. Then there will be a layer of equipment that will be Huawei gear, [but] that won’t be as important to remove right away and can be phased out while still protecting national security. And I think that is exactly what’s happening. MCN: Are you OK with a phased approach? MR: I do think that it is not inappropriate for

the government to try and help these companies. Back in 2012 [when Rogers was chairman of the House Intelligence Committee], I was firing the flare and hoisting the flag about companies like Huawei, ZTE and others who were stealing IP [intellectual property] and artificially competing around the globe because the Chinese government was supporting deals so they could get contracts. So, yes, I am concerned with all of that. But it was legal for these companies to put this equipment in the network and now the U.S. government is saying, ‘Get it out.’ My point is, can we help them do that? It can’t be just, ‘You have to eat this cost, what was legal yesterday is not legal today.’ There should be a path forward for these companies that should include tax breaks or some kind of financial offset. I think that would be a much better place to be. Then, the ecosystem that builds is from Western companies that have a market they can compete in and invest in. To me, that is equally important. You have to cost the taxpayers a little bit upfront to buy security, which I think is OK, and it also allows innovation and rewards companies for competing and investing in this space. MCN: Do you think the president is serious about this crackdown and won’t use it as a trade bargaining chip with China, as he appeared to be doing at one point? MR: There was certainly one time where I think there was some confusion in the administration about whether this was a security issue or a trade issue. I think they are

past that now. I think everyone understands that the security risk of the Chinese Communist government — and by the way their plan is data supremacy by 2025 — is a nonstarter to people who are concerned about the supply chain and the protection of their personal data. This is a security issue, and if China wants to re-engage the world as fair competitors without stealing intellectual property and having the government subsidize contracts to win deals and providing loans that don’t have to be repaid, I would say, welcome back to the market. The problem is they have shown no interest in doing that.

5G Action Now chairman Mike Rogers says he pandemic has laid bare China’s problematic role in the tech supply chain.

MCN: Has the U.K. come around on removing Huawei from its 5G networks rather than still allowing the company to have some profile and, more broadly, would you recommend not sharing intelligence with any country that does not remove them? MR: I would worry about very sensitive data going over Huawei-controlled networks, routing and multiplexing and all of that. There are ways around it, but our British friends got the point and, I think more than anything, the understanding that, ‘Guess what, this Chinese infrastructure has caused us problems with another critical infrastructure, medical personal protection equipment and supplies and medicine and, really, do we want to turn our data, and all of that, and all that 5G will bring, into the hands of the Chinese communist government.’ I think that is why people are starting to rethink their position. In fact I am testifying in front of [Parliament’s] Defense [Select] Committee [on June 2], so I know they are going to rethink their decision. Parliament is going to get another bite at this apple, so I think these hearings are going to prove to be pretty important on this decision to just throw this open to Huawei. If they are in your network a little bit, they are in your network a lot. Data is data. If your sensitive data is flying over networks and [Huawei] does control the ability to multiplex, that’s a problem. MCN: You are testifying remotely, I assume? MR: Originally it was proposed that I show up, but I think we are going to do it remotely, yes. MCN: Who backs 5G Action, which launched this year: wireless ISPs, ISPs, satellite companies? MR: Yeah, you can assume people who are interested in clearing the space responsibly are interested in trying to make sure of two things: One, that people understand that Huawei and ZTE and these other Chinese companies are benefiting from the very strong hand of the Chinese government, and two, what it is going to mean to clear that spectrum in the most responsible way as fast as we can. One of the keys to 5G is getting that spectrum out into the hands of the private sector, the folks who can bid on it and use it to develop 5G. ●

Multichannel.com

Hudson Institute/Wikimedia Commons

because this is the fastest way to get the spectrum? MR: Absolutely this is the fastest way to get it to market. You want the companies that are in that spectrum today to be good partners in clearing the spectrum. It has nothing to do with the financial value of it necessarily, other than the companies have all this investment in it and I do believe the government should respect at least a portion of that. We should move as quickly as we can under the plan that was laid out by [FCC] chairman Ajit Pai, which was a solid plan. Speeding this innovation across America is what is most important. Doing anything that stands in the way of that is counterproductive and certainly helpful to the Chinese.

BUSINESS

Virus Takes a Bite Out of Fee Growth

There could be some concerns that consumers would drop pay TV subscriptions because they can’t pay for them, Sook said. But that isn’t a factor now, because most distributors have pledged not to disconnect for nonpayment for at least the next few months. At Sinclair Broadcast Group, which owns more than 190 TV stations and 23 regional sports networks across the country, the situation is a little dicier. Retrans revenue for Sinclair was up 11% in the period to $355 million, about even with the 11.5% gain in the 2019 quarter. In a research note, Wells Fargo Securities analyst Steven Cahall estimated that Sinclair’s retrans revenue would be up about 5% for the year.

As cord-cutting swells during pandemic, retrans and affiliate-fee growth slows By Mike Farrell michael.farrell@futurenet.com @MikeFCable

ay TV video-subscriber losses, fueled in part by the economic uncertainties surrounding the pandemic, reached a record high in the first quarter and are expected to get bigger, leaving exposed two of the largest revenue segments for programmers — retransmission consent and affiliate fees. Retrans and affiliate fees have grown exponentially over the past decade, but growth has slowed over the past several quarters. As more and more households disconnect their pay TV service, the impact could be hard on programmers that have come to rely on those revenue streams to offset declines in the advertising market. Affiliate-fee growth was anemic in the first quarter, with Turner, Fox, The Walt Disney Co. and Discovery reporting modest increases, while NBCUniversal, ViacomCBS and AMC Networks all declined. For national broadcasters, retrans fee growth was about 15% in Q1, down from a 22% increase in the same period last year.

High Sub Losses

About 2 million customers cut the pay TV cord in Q1, the worst quarter ever for cable, satellite and now virtual multichannel video programming distributors (MVPDs) such as Sling TV. The bulk of those losses came from AT&T’s satellite-TV provider, DirecTV (897,000), and Dish Network (413,000). But traditional cable operators, who have seen video customers decline for more than a decade, also saw increased losses. Overall, pay TV subscribers fell by 7.6%, the highest rate of decline ever. Comcast lost about 409,000 video customers in Q1, more than three times the 120,000 it lost in the year-ago period. Altice USA lost about 42,000 video customers in the quarter, four times the 10,000 losses it had in Q1 2019. Charter Communications, the No. 2 U.S. cable operator behind Comcast, was the exception, managing to escape the quarter with 71,000 video losses, less than half the 152,000 it shed in the prior year. Though pay TV subscribers were in decline well before COVID-19, MoffettNathanson principal and senior analyst Craig Moffett 20

Multichannel.com

said in a research report, the pandemic has helped accelerate the fall. While some point to a lack of live sports programming as professional and college sports all suspended or canceled their seasons, Moffett wasn’t too optimistic those lost customers would return when live games resume. “Does anyone think that when sports come back those customers will return to pay TV (either traditional or vMVPD)?” Moffett asked. “We doubt it. The underlying causes for the defections are not transitory. The transitory factors are just pulling forward the defections.” Retrans and cable network affiliate-fee growth will continue to decline over the next three years, Moffett predicted, as pay TV customers cut the cord. In his report, he estimated retrans growth would drop to 14% in 2020 from 17% in 2019 and to 7% by 2023. Affiliate-fee growth, at about 3% in 2019, would slow to 1% in 2020 and to minus 1% by 2023, according to Moffett. At Kagan, a research unit of S&P Global Market Intelligence, senior research analyst Justin Nielson also predicted that faster declines in video subscriber growth would have an effect on retrans. In his “bear case” scenario — estimating traditional subscribers decline by 12% for the year and vMVPDs gain 8% — gross retrans and virtual subscriber fees would fall 3% to $12 billion in 2020. In Kagan’s “middle of the road” scenario, where MVPDs decline 10% and vMVPDs rise 12%, retrans and virtual subscriber fees would be relatively flat at $12.6 billion in 2020. The “bull case” — less likely with the recent results — predicted that retrans revenue would grow 6% and traditional pay TV subscribers would fall 8% as live sports returns and people return to work. The pandemic has made it difficult to predict the future, with every major cable network and broadcaster having pulled back prior guidance for the year. But Kagan’s Nielson said broadcasters may fare better because many of them had struck multi-year deals before the pandemic hit. At Nexstar Media Group, the largest broadcaster in the country with 196 stations, chairman CEO Perry Sook said on a Q1 analyst call that Nexstar has modeled out pay TV subscriber attrition into overall projections and, so far, they have come in better than assumptions. “So it is not like sub declines are sneaking up on anybody here,” Sook said on the May 6 call.

Sinclair’s High Exposure

Cahall downgraded Sinclair to “underweight” on May 4, based on its high exposure to affiliate fees and retrans: 68% of total revenue comes from those sources, compared to 50% for Nexstar. “A recession will likely exacerbate cord-cutting,” Cahall wrote in his downgrade note, adding that retrans growth could be lower because of a need to secure carriage for the RSNs. “We think rates could trend towards the lower end of the broadcast peer group in part because we think [Sinclair] may be less aggressive on retrans with MVPDs in order to support RSN carriage with MVPDs,” Cahall wrote. “This would be throwing good money after bad, in our view.” ●

GROWTH SLUMP Accelerated pay TV subscriber declines will spark a downturn in both retrans and affiliate-fee growth rates through 2023, MoffettNathanson principal and senior analyst Craig Moffett predicts.

2019 2020E 2021 2022 2023

Retrans

17%

14%

11%

Affiliate Fees 3%

Total

SOURCE: Company reports, MoffettNathanson estimates and analysis

STATION TO STATION Retransmission-consent revenue for top station groups will rise in the mid-single-digit percentages through 2022, Wells Fargo Securities analyst Steven Cahall estimates. Category

($ in millions) 2020E 2021E 2022E

Nexstar

$2,184

$2,384

$2,521

Sinclair

$1,445

$1,561

$1,686

Tegna

$1,241

$1,464

$1,563

$870

$981

$1,007

Gray Television

SOURCE: Wells Fargo Securities estimates

FATES & FORTUNES

People Notable executives on the move BRIEFLY NOTED Other industry execs making moves

COMMSCOPE

CSG SYSTEMS

CYPHER CONTENT

DISNEY

Connectivity solutions firm CommScope has named Jeff White as chief commercial officer. He was chief customer officer at location services platform company Here Technologies.

Silvio Tavares has joined the board of directors of billing systems provider CSG Systems. He is CEO of payment and digital advertising trade association The CardLinx Association.

Former A+E Networks head of international Edward Sabin has launched Cypher Content, a Los Angeles-based entertainment and media venture that will produce content for the U.S. market. He will serve as president and CEO.

Rebecca Campbell was named chairman, Direct-to-Consumer and International at The Walt Disney Co., responsible for Disney Plus, ESPN Plus, Hulu and Hotstar. She most recently served as president of Disneyland Resort.

MEDIAMATH

MEREDITH

PEGASYSTEMS

Ad technology firm MediaMath has added Anudit Vikram as senior VP, product, He had been chief product officer at Edge by Ascential, a market intelligence company that offers a platform for digital retailers.

Kimberly Samon was named chief people officer at New York-based MediaMath. She had been head of global operational excellence and chief people officer at Weight Watchers International.

Rob Silverstein was named executive producer and showrunner of Meredith’s new daily syndicated show based on the People magazine brand. He is the former executive producer of Access Hollywood.

Cloud software firm Pegasystems has named Carola Cazenave as VP, global partner ecosystem. She joins from IBM, where she had been VP, North America business partner ecosystem.

TIKTOK

TVU NETWORKS

VIACOMCBS

VIZIO

Kevin Mayer has joined TikTok as CEO. He comes from The Walt Disney Co., where he was chairman of Direct-to-Consumer and International business, overseeing the Disney Plus launch.

Cloud and internet protocolbased live video solutions firm TVU Networks named Sushant Rai as VP, sales, South Asia, Middle East and Africa. He was managing director, sales, for South Asia at Harmonic.

Dan Cohen has been named president of the ViacomCBS Distribution Group, replacing Armando Nuñez, who shifts to an advisory role. He was president of Worldwide Home Entertainment & Television Distribution for Paramount Pictures.

John R. Burbank has been named to the board of smart TV and sound bar maker Vizio. The consumer marketing and advertising veteran is president of strategy and corporate development at Nielsen.

Multichannel.com

Rani Raad was named president, CNN Commercial, a new worldwide post. The 22-year veteran was president of CNN International Commercial. … Phil Hinson has joined FatPipe Networks as senior VP of strategic business. He had been VP of sales and VP of technical sales at AT&T At Meredith, Jeff Holub was promoted to VP and general manager of WHNS in Greenville, South Carolina, from station manager of WGCL and WPCH, Atlanta, and Kelly Boan was promoted to station manager of WHNS from assistant news director. … Denise Denson was named chief operating officer of Molten, a cloudbased content rights and media technology company. She is the former executive VP of global content distribution at Viacom, having left the media company in 2016. … Also at Pegasystems, Daniel Österberg-Holm was named VP, alliances, channels, and specialist sales, EMEA. He was VP for EMEA alliances and channels at ServiceNow. … Boston-based research firm Strategy Analytics has named Edouard Bouffenie as head of its new TV Streaming Platforms research practice.

DATA MINE

Data provided by

Ad Meter Who’s spending what where

PROMO MOJO Our exclusive weekly ranking of the programming that networks are promoting most heavily (May 18-24)

BIG SPENDERS

MOST-SEEN TV ADS

Brands ranked by the greatest increase in TV spend (May 18-24)

Brands ranked by TV ad impressions (May 18-24)

1 Lexus

GEICO

Spend Increase:

▲ 291%

$7.7M

Est. TV Spend:

Attention Score:

Top Network:

NBC

Top Show: NASCAR Cup Series

Progressive

Est. TV Spend:

▲ 221%

$8.3M

Attention Score:

Top Network:

CBS

Top Show:

Christopher Polk/E! Entertainment

Estimated media value of in-network promos On the strength of 293.6 million TV ad impressions, a promo for TNT’s The Match: Champions for Charity was No. 1 (it was simulcast on TBS, truTV and HLN). Cable dominated the top 5, with TNT joined by Nickelodeon, which hyped its Wild About Movies family film night, at No. 2, and Nat Geo and Discovery, which promoted Barkskins and All on the Line, respectively, in fourth and fifth. NBC grabbed third place for The Titan Games. Notably, the Nick promo had the highest iSpot Attention Index number (146), interrupted 46% less often than the average promo (interruptions include changing the channel, pulling up the guide, fast-forwarding or turning off the TV).

Multichannel.com

The Match

Lowe's

Spend Increase:

Est. Media Value: $2,097,133

93.11

Clorox

Total TV ad impressions within all U.S. households, including national linear (live and time-shifted), VOD plus OTT and local

1.07B $14.3M

Est. TV Spend:

18%

TV Ad Impressions: 293,558,538

TV Ad Impressions:

Spend Within Industry:

Est. TV Spend:

▲ 127%

$2.3M 13%

Spend Within Industry: Top Network:

93.16

Spend Increase:

TOP 5 PROMOTIONS

$14.4M

Est. TV Spend:

17%

Subaru

1.18B

Spend Within Industry:

Capital One The Match: Champions for Charity, TNT

TV Ad Impressions:

Discovery en Español

TV Ad Impressions:

1.07B

Est. TV Spend:

$9.7M

Attention Score:

95.11

Top Show:

Love It or List It

1. Capital One The Match:

Champions for Charity, TNT

TV Ad Impressions Est. Media Value

293,558,538 $2,097,133

2. Wild About Movies, Nickelodeon TV Ad Impressions Est. Media Value

3. The Titan Games, NBC TV Ad Impressions Est. Media Value

4. Barkskins, Nat Geo TV Ad Impressions Est. Media Value

278,171,303 $7,513,393 262,381,313 $3,591,382 246,738,072 $2,446,204 229,228,279 $1,104,549

Universal Pictures

Liberty Mutual

Spend Increase:

▲ 73%

TV Ad Impressions:

1.07B

Est. TV Spend:

$5.0M

Est. TV Spend:

$7.9M

Attention Score:

86.33

Spend Within Industry: Top Network:

5. All on the Line, Discovery TV Ad Impressions Est. Media Value

45% HGTV

Top Show:

The Five

Dawn

Domino's

Spend Increase:

▲ 69%

TV Ad Impressions:

Est. TV Spend:

$1.7M

Est. TV Spend:

Spend Within Industry:

10%

Attention Score:

Top Network:

CBS

Top Show:

850.27M $8.2M 96.52 Live PD

DATA MINE

AVOD TO TAKE BIG PANDEMIC HIT: STUDY GLOBAL REVENUE generated by over-the-top video services is set to nearly double from 2019 to 2025, reaching $167.4 million, per Digital TV Research. But the bad news will be a short-term hit to the growth of ad-supported VOD (AVOD) streaming services, the firm said. The category, which includes Roku Channel, Tubi, Pluto TV, IMDb TV and others, will grow by just 10% this year, rising to $26.711 billion in revenue. By 2025, it will expand to $53.522 billion. Notably, last June, Digital TV Research predicted AVOD would grow to generate $56 billion by 2024.

Barkskins

MCN’S MOST VIEWED Top five stories on multichannel.com, May 18-27 1. Weekly Cable Ratings: Fox News Triumphant Among Total Viewers 2. Programming Review: ‘Barkskins’ 3. Sinclair Stock Soars on Speculation of More RSN Carriage Deals 4. Cover Story: Home Shopping’s Second Act 5. HBO Max Available on Hulu at Launch

“Advertising confidence has been hit,” Simon Murray, principal analyst for Digital TV Research, said. “We expect lower growth for AVOD in 2020, but recovery thereafter.” SVOD services will more than double from 2019 to 2025 to nearly $98 billion. “SVOD has boomed during the lockdown and thanks to the rollout of Disney Plus,” Murray said. Digital TV Research’s analysis covers 138 countries, encompassing not only SVOD and AVOD services, but also online video rentals and sales. — Daniel Frankel For more stories on the streaming space, go to nexttv.com.

GLOBAL OTT TV & VIDEO REVENUES BY SOURCE ($million)

200000 175000 150000 125000 100000 75000 50000 25000 0

To read these stories, visit multichannel.com/June1.

STICKIEST SHOWS Top 10 cable programs ranked by viewer engagement Ratings Rank

Telecast (Week Ending April 19)

Network

Stickiness Index*

90 Day Fiancé: Before the 90 Days

TLC

157

The Last Dance

ESPN

155

Aurora Teagarden Mysteries: Heist and Seek Hallmark Movies

Little People, Big World

TLC

137

How to Train Your Husband

Hallmark Channel

135

Love & Hip Hop Atlanta

VH1

135

734

La Rosa de Guadalupe

Galavisión

135

122

The Real Housewives of Atlanta

Bravo

135

90 Day Fiancé: What Now?

TLC

134

Good Witch

Hallmark Channel

134

152

* TV Engagement ratings powered by Comscore’s TV Essentials. (Sorted by social media activity.)

Multichannel.com

National Geographic/Peter H. Stranks; TLC

Stickiness Rank

DATA MINE

Data provided by

STICKIEST SHOWS Top 10 broadcast programs ranked by viewer engagement Ratings Rank

Telecast (Week Ending May 3)

Network

Stickiness Index*

160

¿Qué Culpa Tiene Fatmagül?

UniMás

148

Amor Eterno

Univision

146

109

Cennet

Telemundo

144

Te Doy La Vida

Univision

143

American Idol

ABC

134

9-1-1

Fox

134

FBI

CBS

132

60 Minutes

CBS

130

The Voice

NBC

128

The Masked Singer

Fox

128

Stickiness Rank

* TV Engagement ratings powered by Comscore’s TV Essentials. (Sorted by social media activity.)

THE WEEK OF MAY 18 TV Time users track the shows they're watching on TV via the TV Time app. That data is then used to determine the most-binged shows of the week in the U.S.

LAST WEEK: 1

Avatar: The Last Bender

Share of binges: 2.38%

Riverdale

Share of binges: 1.84%

Sweet Magnolias

Share of binges: 1.32%

Grey's Anatomy

Share of binges: 1.31%

Top five stories on nexttv.com, May 18-27

Community

Share of binges: 1.20%

Criminal Minds

Share of binges: 1.16%

1. Why CBS All Access Wants to, And Must, Become ‘ViacomCBS All Access’

The Flash

Share of binges: 1.12%

3. AT&T Faces Renewed Pressure to Sell DirecTV

Schitt's Creek

Share of binges: 1.06%

4. Disney Plus Emerges as MultibillionDollar 'Star Wars' Franchise’s New Hope

Upload

Share of binges: 0.91%

5. Streaming Projected to Be Lone Growth Area Amid $160B Pandemic Bath

LAST WEEK:9

LAST WEEK: —

LAST WEEK: 2

LAST WEEK: 4

LAST WEEK: 6

LAST WEEK: —

Aaron Epstein/CBS; ABC/Eliza Morse

Share of binges: 2.59%

LAST WEEK: —

Dead to Me

LAST WEEK:7

LAST WEEK: 3

Networks reflected are not inclusive of every viewing platform available

Multichannel.com

To receive "The Binge Report" and otherTV Time reports, visit https://www.whipmedia.com/subscribe/

Picard on CBS All Access

NEXT TV’S MOST VIEWED

2. Is CBSN the Future of TV News?

To read these stories, go to nexttv.com.

DATA MINE

Ratings America's favorite TV personalities, past and present TODAY.YOUGOV.COM

Alex Trebek

71%

Ellen DeGeneres

57%

Bob Barker

65%

Pat Sajak

57%

Drew Carey

60%

Steve Harvey

57%

Jay Leno

58%

Jeff Foxworthy

55%

Vanna White

58%

David Letterman

54%

Methodology: Based on sample size of 7,623 US adults who had a positive rating of these TV personalities between May 2019-May 2020

Image: Jeopardy Productions, Inc.

Multichannel.com

VIEWPOINT

to partner with omnichannel players that can help them adapt their strategies across CTV, mobile, video, desktop, native, addressable TV and audio. Consumers are also tightening their belts and may begin to reduce the number of streaming services they have. If so, it becomes harder for advertisers to buy on an IO (insertion order) basis while programmatic buying affords greater opportunity and flexibility. Precise targeting (58%) and accurate measurement (39%) are the top reasons why advertisers are drawn to CTV in the first place. Yet, there’s more to be done as the CTV ecosystem is responding to the surge in demand by evolving just as other emerging channels, like mobile, have done in the past. Data and verification vendors are stepping up to provide third-party verification, giving advertisers confidence in their investment and delivering accurate measurement of return on ad spend. This assuages concerns about an “adtech tax,” because marketers will know what money is going in and what results they’re getting from their placements. In today’s climate, when the digital media supply chain can seem opaque, this is critical. The adoption of common industry standards will also increase confidence across the CTV landscape. Accurate measurement, pricing, brand safety and ad fraud are understandable concerns in any emerging channel. The IAB Tech Lab is meeting the unique challenges in CTV with its own recommendations, which will go a long way in aligning all stakeholders. In recent years, accuracy has been difficult because of the wide range of devices and software in play. Recommending common app-store IDs, along with the app-ads.txt standard, allows users to compare apples to apples and to reduce fraud in this booming market.

By Iván Markman, Verizon Media @VerizonMedia

CTV Ads Were Always Poised to Break Out in 2020 Pandemic accelerates a spending shift that favors addressability

he pandemic environment is accelerating the shift to connected TV (CTV) consumption. In fact, streaming video adoption has surged an estimated 60% as the world self-isolates and we navigate a new reality. Even before the COVID-19 crisis, though, the industry was already witnessing an explosion in CTV viewership. Fans have cut the cord on expensive cable subscriptions and now watch their favorite shows on mobile devices or smart TVs, wherever and whenever they want. For marketers, CTV offers an attractive opportunity because of the data that enables precise targeting across digital channels alongside premium networkquality programming. Last year, CTV ad spend approached $7 billion, a near 40% increase, while U.S. viewership is expected to exceed 200 million people in 2021. While everyone is talking about COVID-19’s impact on CTV spend, the numbers were always poised to climb. Here’s why.

Getty Images

More Advertiser Options

CTV ad inventory is opening up. And while many of these services are subscription-based video-on-demand (SVOD), ad-based VOD platforms are exploding. New services, like NBCUniversal’s Peacock, are expected to follow the ad-supported model and for good reason. Forbes estimates that Hulu earns $7 per month per ad-supported user. During COVID-19, we’re also seeing providers like Vudu offer more content for free, but with commercials. Broadcasters with CTV options are capturing the audience as it shifts to streaming, delivering impressive results for advertisers. For instance, Innovid found that 63% of broadcasters’ digital ad impressions were in CTV environments. What’s more, compared with other standard preroll ads, CTV advertising held the audience’s attention longer and gen-

Multichannel.com

erated a sixfold increase in engagement. As CTV inventory scales amid the corona virus crisis, we can expect more of these opportunities to be sold programmatically. By 2021, nearly 60% of CTV ads will be sold that way, up more than 50% from 2019. As is the case with any emerging channel, broadcasters and publishers are somewhat wary of shifting high-value inventory to programmatic marketplaces for pricing reasons. However, broadcasters that sell more inventory programmatically will benefit because the demand is there. Pre-coronavirus, the Interactive Advertising Bureau (IAB) found that nearly all companies — 94% — were planning to increase or maintain their CTV spend this year, with half looking to grow their commitment. As that occurs, buyers who enjoy the seamless nature of programmatic transactions for web and mobile inventory will be seeking the same from CTV. In the current environment, marketers are also looking for additional flexibility in how they spend. They want to adjust programmatic investments accordingly as they grapple with COVID-19’s impact. As a result, CTV inventory should be available alongside other forms of programmatic supply. Buyers want

Data Activation Has Improved

Iván Markman is chief business officer of Verizon Media.

As more broadcasters and demand-side platforms (DSPs) adopt VAST (Video Ad Serving Template) 4.x, video ads can be delivered more seamlessly without breaks in the complicated chain. Connecting these dots to use data is a challenge, but solutions using Auto mated Content Recognition (ACR) data help advertisers reach specific audiences on CTV. ACR gives us a data stream unique to smart TVs, which flows from viewers to the manufacturer. In an anonymized way, the specific shows and commercials that someone watches can be assessed second-by-second and connected to an IP address. And new technologies now offer a way to use ACR data to target ads on digital channels across mobile and desktop platforms. This bridge between TV and digital makes omnichannel targeting much easier and more efficient for advertisers. And, in today’s “new normal,” especially as CTV attracts greater spend, simplicity and efficiency are table stakes. As the space evolves and sees even greater interest at a time of self-isolation, these changes will ensure that CTV is growing in the right direction, meeting the rising demand to deliver top-performing ads around popular TV shows over the web at scale. ●

THE FIVE SPOT

Dennis Wharton

EVP, Communications, National Association of Broadcasters Trade group’s longest-running comms chief ready to call it a career

ennis Wharton is exiting his post as chief spokesman and communications strategist for the National Association of Broadcasters at the end of June after 24 years, the longest such tenure in the group’s history. Wharton and NAB, under president and CEO Gordon Smith, have not been shy about fighting for the preservation of a must-carry/retransmission consent system that cable operators have been just as vigorous in attacking as anachronistic, but Wharton said those fights stay in the policy ring. In a previous life, Wharton covered Washington as the D.C. bureau chief for Variety. He spoke with Multichannel News senior content producer, Washington, John Eggerton. You are leaving after 24 years; 25 would seem a more likely number. Why are you leaving now and what will you be doing? This has been planned for over a year. I signed a one-year contract last year — I’d always had three-year contracts before. But I only wanted a one-year deal because I’m getting worn out by the day-to-day grind, and I need to spend more time with my parents in Ohio. They’re in not-so-great health and living independently. When this damn virus is over, [wife] Lisa and I also plan to travel — we’ve had 14 foreign exchange students through the years — and we want to see some of the world.

Big Buckeyes fan Dennis Wharton with former Ohio State football coach Urban Meyer (l.). 32

Multichannel.com

Gordon asked me to stay on as a consultant to make sure there’s a smooth transition to Ann Marie Cumming as the new NAB spokesperson. So I’ll still be part of NAB, but not full-time. What have you been doing to cope with the new shelter-in-place normal? You mean between NAB Zoom meetings? For fun, a lot of euchre with my kids, who are back home because of the virus. It’s a card game played mostly in the Midwest. Virtual trivia nights are fun, too. ACA Connects president and CEO Matt Polka said of your departure: ‘NAB is saying farewell to a leader with too many friends to count. Washington is losing one of the good guys.’ Anything you want to say to the loyal opposition? That was really classy of Matt. I sent him an email and said: ‘Hey guy. You blew my cover. We’re not supposed to like each other!’ I’m glad Matt and I can fight like heck on retrans and still be friends. Something really bad has happened in D.C. since I got here in the early ’80s. Ronald Reagan and Tip O’Neill had knock-down drag-out fights back in the day. But they could share Irish whiskey after hours, and they actually got good stuff done. What have been the most and least rewarding parts of your job? Most rewarding is probably just surviving this long. That’s been really gratifying. I tried to bring my A-game every day. I’m not going to lie, there have been some really tough days. But to survive for almost a quarter of a century — from [NAB presidents] Eddie Fritts to David Rehr to Gordon Smith — it’s been a wild ride. This will sound sappy, but I also take pride in defending broadcasters as a force for good. …. If we were invented today, I bet policymakers would do handstands down Pennsylvania Avenue. Least rewarding was missing some of the family stuff through the years. … Also least rewarding was some of the NAB Board politics over the years. Gordon Smith has done a great job managing that. Anything you would like to say to the broadcasters whose standard you have carried for almost a quarter century? I just want to thank everyone who helped me along

BONUS FIVE What is on your DVR? Lots of Ohio State wins against the Wolverines in football. Those never get old. Also PBS Masterpiece’s World on Fire. Bucket list destination? Lisa and I were planning a two-week trip to Norway with a former foreign exchange student’s family in July, right after my retirement. That’s on hold. Books on your nightstand? Rick Atkinson’s The British Are Coming. Just re-read Hemingway’s For Whom the Bell Tolls. Favorite musical group? The Beatles Most memorable recent meal? Pamplemousse in Las Vegas. I hosted more than 20 reporter dinners there at NAB Show. I recommend the pistachiocrusted rack of lamb.

the way. Especially Eddie for persuading me to join NAB, when I really had no interest in leaving journalism. And Gordon for being the most decent boss you could imagine. And for all the people I worked with, especially in my communications department. I’d also like to thank the reporters who covered NAB — people like you, John — who were really fair to me. Journalism is a really hard job, and it really bothers me to see attacks on the press from both the left and the right. It needs to stop. ●

9000