TikTok inks licensing deal with Merlin to use music from independent labels in videos and new Resso streaming service

TikTok, the fast-growing user-generated video app from China’s Bytedance, has been building a new music streaming service to compete against the likes of Spotify, Apple Music and Amazon Music. And today it’s announcing a deal that helps pave the way for a global launch of it. It has inked a licensing deal with Merlin, the global agency that represents tens of thousands of independent music labels and hundreds of thousands of artists, for music from those labels to be used legally on the TikTok platform anywhere that the app is available.

The news is significant because this is the first major music licensing deal signed by TikTok as part of its wider efforts in the music industry. That includes both its mainstay short-form videos — where music plays a key role (the app, before it was acquired by Bytedance, was even called ‘Musically’) — as well as new music streaming services.

Specifically, a source close to TikTok has confirmed to TechCrunch that this Merlin deal covers its upcoming music subscription service Resso.

Resso was long rumoured and eventually spotted in the wild at the end of last year when Bytedance tested the app in India and Indonesia. Bytedance owns the Resso trademark, so it’s a good bet that it will make its way to more markets soon. (Possibly with features that differentiate this later entrant from others in the market? Recall Bytedance acquired an AI-based music startup called Jukedeck last year.)

“Independent artists and labels are such a crucial part of music creation and consumption on TikTok,” said Ole Obermann, global head of music for Bytedance and TikTok, in a statement. “We’re excited to partner with Merlin to bring their family of labels to the TikTok community. The breadth and diversity of the catalogue presents our users with an even larger canvas from which to create, while giving independent artists the opportunity to connect with TikTok’s diverse community.”

Music is a fundamental part of the TikTok experience, and this deal covers everything that’s there today — videos created by TikTok users, sponsored videos created for marketing — as well as whatever is coming up around the corner.

A music streaming app, which TikTok has reportedly been gearing up to launch for some time, is one way that the company could help generate revenue. Despite being one of the most popular apps of 2019, monetisation has largely eluded the company up to now.

One reason why monetising can’t happen is because of the lack of deals at the other end of the chain. As of December, TikTok had yet to sign any deals with the “majors” — Sony Music, Warner Music and Universal Music — and from what we understand Merlin is the first big deal of its kind of the company. However, there are signs that more such agreements may be coming soon. Obermann, who was hired away from Warner Music last year, in turn hired another former Warner colleague, Tracy Gardner, who now leads label licensing for the company. And just yesterday, the company opened an office in Los Angeles, the heart of the music industry.

The move to bring more licensed music usage to TikTok (and other Bytedance apps) is significant for other reasons, too.

On one hand, it’s about labels trying to evolve with the times, collecting revenues wherever audiences happen to be, whether that is in short-form user-generated video, in advertising that runs alongside that, or in a new music service capitalising on the new vogue for streamed media.

“This partnership with TikTok is very significant for us,” said Jeremy Sirota, CEO, Merlin, in a statement. “We are seeing a new generation of music services and a new era of music-related consumption, much of it driven by the global demand for independent music. Merlin members are increasingly using TikTok for their marketing campaigns, and today’s partnership ensures that they and their artists can also build new and incremental revenue streams.”

One the other hand, the deal is significant also because it underscores how TikTok is increasingly working to legitimise itself in the wider tech and media marketplace.

While Bytedance’s acquisition of TikTok continues to face regulatory scrutiny, the company has been working on ways to assert its independence from China’s control, which has included many clarifications about where its content is hosted (not China! it says) and even a search for a new US-based CEO. On another front, more licensing deals should also help the company with the many legal and PR issues that have been hanging over it concerning how it pays out when music is used in its popular app.

Shadows’ Dylan Flinn and Kombo’s Kevin Gould on the business of ‘virtual influencers’

In films, TV shows and books — and even in video games where characters are designed to respond to user behavior — we don’t perceive characters as beings with whom we can establish two-way relationships. But that’s poised to change, at least in some use cases.

Interactive characters — fictional, virtual personas capable of personalized interactions — are defining new territory in entertainment. In my guide to the concept of “virtual beings,” I outlined two categories of these characters:

  • virtual influencers: fictional characters with real-world social media accounts who build and engage with a mass following of fans.
  • virtual companions: AIs oriented toward one-to-one relationships, much like the tech depicted in the films “Her” and “Ex Machina.” They are personalized enough to engage us in entertaining discussions and respond to our behavior (in the physical world or within games) like a human would.

Part 2 of 3: the business of virtual influencers

Today’s discussion focuses on virtual influencers: fictional characters that build and engage followings of real people over social media. To explore the topic, I spoke with two experienced entrepreneurs:

  • Dylan Flinn is CEO of Shadows, an LA-based animation studio that’s building a roster of interactive characters for social media audiences. Dylan started his career in VC, funding companies such as Robinhood, Patreon and Bustle, and also spent two years as an agent at CAA.
  • Kevin Gould is CEO of Kombo Ventures, a talent management and brand incubation firm that has guided the careers of top influencers like Jake Paul and SSSniperWolf. He is the co-founder of three direct-to-consumer brands — Insert Name Here, Wakeheart and Glamnetic — and is an angel investor in companies like Clutter, Beautycon and DraftKings.

Original Content podcast: Netflix goes to the Oscars

When this year’s Academy Award nominations were announced on Monday, Netflix received 24 nominations — the most of any Hollywood studio.

That’s thanks in large part to “The Irishman,” which received 10 nominations, and “Marriage Story,” which received six (both films were nominated for Best Picture). As a result, Darrell finally watched Martin Scorsese’s three-and-a-half hour gangster epic — and he wasn’t impressed by the results.

He explains why on the latest episode of the Original Content podcast, in we discuss our reactions to the nominations, including the eyebrow-raising 11 nods for “Joker.” This leads to a broader discussion of why the nominations were so disappointing from a diversity perspective, and what exactly we want from awards like the Oscars anyway.

In addition, we recap the latest details about NBCUniversal’s upcoming streaming service Peacock, and Jordan offers a spoiler-y review of the second season of Netflix’s “You.”

You can listen in the player below, subscribe using Apple Podcasts or find us in your podcast player of choice. If you like the show, please let us know by leaving a review on Apple. You can also send us feedback directly. (Or suggest shows and movies for us to review!)

And if you’d like to skip ahead, here’s how the episode breaks down:
0:00 Intro
1:01 Peacock discussion
14:21 Oscars discussion
53:17 “You” season 2 spoiler review

NBCU’s streaming service Peacock launches April 15 for Comcast subscribers, everyone else on July 15

NBCUniversal officially unveiled its new streaming service Peacock today, announcing that the service will be available as part of a bundle for Comcast’s Xfinity X1 and Flex customers on April 15, before launching nationally on July 15.

The company had announced its plans to enter the streaming market a year ago, describing it as an ad-supported, subscription service that would also be available to pay-TV subscribers at no additional cost.

That’s more-or-less what the company detailed at an investor presentation today, where it said there will a free tier of Peacock that includes more than 7,500 hours of programming, including classic shows and the current seasons of freshman broadcast series.

But if you want to see the original programming that NBCUniversal is creating for Peacock — and twice as many hours of content overall — you’ll need Peacock Premium, which will be bundled for Comcast and Cox subscribers, and will cost $4.99 per month otherwise.

Both of those versions will include ads, though you can also pay $9.99 for an ad-free experience.

The new service is one of several big streaming launches expected this year, with WarnerMedia’s HBO Max and Jeffrey Katzenberg’s mobile service Quibi also preparing to make their debuts. Those join other recent entries from Disney and Apple in an increasingly crowded streaming landscape still led by the big three — Netflix, Amazon Prime Video, and Hulu. (The latter is now majority-owned by Disney, but NBCU parent Comcast will hold onto its Hulu stake until 2024.)

Many of the newer streamers — including the just-launched Disney+ and Apple TV+, as well as the upcoming HBO Max — are opting for an ad-free experience. But NBCU’s Peacock will instead follow the business models adopted by Hulu and ViacomCBS Inc.s’ CBS All Access, where advertising helps to bring down the cost of the subscription.

Despite its terrible name (yes, we get it — it’s the NBC logo), Peacock has a chance to grab a slice of the streaming market thanks to its decent back catalog and NBCU’s plans to promote the service heavily during the Summer Olympics on NBC.

NBCU announced Peacock’s original programming lineup last fall, which includes reboots of “Battlestar Galactica,” “Punky Brewster,” and “Saved by the Bell,” plus new series like “Dr. Death,” based on the true-crime podcast; “Brave New World,” based on the dystopian Aldous Huxley novel; an SNL docu-series “Who Wrote That,” “One of Us Is Lying,” based on the NYT best-seller, and many more.

Peacock will also be the new home for Netflix’s most-watched series, “The Office,” in a deal valued at $500 million for the comedy classic.

Other NBC shows will be available on Peacock, too, including  “30 Rock,” “Bates Motel,” “Battlestar Gallactica,” “Brooklyn Nine-Nine,” “Cheers,” “Chrisley Knows Best,” “Covert Affairs,” “Downton Abbey,” “Everyone Loves Raymond,” “Frasier,” “Friday Night Lights,” “House,” “Keeping Up with the Kardashians,” “King Of Queens,” “Married…With Children,” “Monk,” “Parenthood,” “Psych,” “Royal Pains,” “Saturday Night Live,” “Superstore,” “The Real Housewives,” “Top Chef,” and “Will & Grace.”

Popular films to stream on Peacock include “American Pie,” “Bridesmaids,” “Knocked Up,” “Meet the Parents,” “Meet the Fockers,” “A Beautiful Mind,” “Back to the Future,” “Brokeback Mountain,” “Casino,” “Dallas Buyers Club,” “Do the Right Thing,” “Erin Brockovich,” “E.T. The Extra Terrestrial,” “Field of Dreams,” “Jaws,” “Mamma Mia!,” “Shrek,” and “The Breakfast Club.” Peacock will also feature films from the franchises: “Bourne,” “Despicable Me,” and “Fast & Furious.”

 

 

Comcast launches SportsTech startup accelerator with NASCAR and others

Comcast NBCUniversal believes its can access startup innovation while supporting future Olympic gold-medalists.

The American mass media company launched its new SportsTech accelerator today, based in part, on that impetus.

TechCrunch attended a briefing with Comcast execs at 30 Rock NYC to learn more about the initiative.

The SportsTech accelerator is a partnership across Comcast NBCUniversal’s sports media brands: NBC Sports, Sky Sports and the Golf Channel.

The program brings in industry partners NASCAR, U.S. Ski & Snowboard and USA Swimming — all of whose sports broadcast on Comcast NBC channels.

Starting today, pre-Series A sports technology startups can apply to become part of a 10-company cohort.

Accepted ventures will gain $50,000 in equity-based funding and enter SportsTech’s three-month accelerator boot camp — with sports industry support and mentorship — to kick off at Comcast’s Atlanta offices August 2020.

Boomtown Accelerators will join Comcast in managing the SportsTech program, with both sharing a minimum of 6% equity in selected startups.

Industry partners, such as NASCAR and U.S. Ski & Snowboard, will play an advisory role in startup selection, but won’t add capital.

An overarching objective for SportsTech emerged during conversations with execs and Jenna Kurath, Comcast’s VP for Startup Partner Development, who will run the new accelerator.

Comcast and partners aim to access innovation that could advance the business and competitive aspects of each organization.

From McDonald’s McD Tech Labs to Mastercard’s Start Path, corporate incubators and accelerators have become common in large cap America, where companies look to tap startup ingenuity and deal-flow to adapt and hedge disruption.

Toward its own goals, SportsTech has designated several preferred startup categories. They include Business of Sports, Team and Coach Success and Athlete and Player Performance.

SportsTech partners, such as NASCAR, hope to access innovation to drive greater audience engagement. The motorsport series (and its advertising-base) has become more device-distributed, and NASCAR streams more race-day data live, from the pits to the driver’s seat.

“The focus has grown into what are we going to do to introduce more technology in the competition side of the sport…the fan experience side and how we operate as a business,” said NASCAR Chief Innovation Officer Craig Neeb.

“We’re confident we’re going to get access to some incredibly strong and innovative companies,” he said of NASCAR’s SportsTech participation.

U.S. Ski & Snowboard — the nonprofit that manages America’s snowsport competition teams  — has an eye on performance and medical tech for its athletes.

“Wearable technology [to measure performance]…is an area of interest…and things like computer vision and artificial intelligence for us to better understand technical elements, are quite interesting,” said Troy Taylor, U.S. Ski & Snowboard’s Director of High Performance.

US Ski Team

Credit: U.S. Ski & Snowboard

Some of that technology could boost prospects of U.S. athletes, such as alpine skiers Tommy Ford and Mikaela Shiffrin, at the 2022 Beijing Winter Olympics.

In a $7.75 billion deal inked in 2014, Comcast NBCUniversal purchased the U.S. broadcast rights for Olympic competition —  summer and winter —  through 2032.

“We asked ourselves, ‘could we do more?’ The notion of an innovation engine that runs before, during and after the Olympics. Could that give our Team USA a competitive edge in their pursuit for gold?,” said Jenna Kurath.

The answer came up in the affirmative and led to the formation of Comcast’s SportsTech accelerator.

Beyond supporting Olympic achievement, there is a strategic business motivation for Comcast and its new organization.

“The early insights we gain from these companies could lead to other commercial relationships, whether that’s licensing or even acquisition,” Will McIntosh, EVP for NBC Sports Digital and Consumer Business, told TechCrunch.

SportsTech is Comcast’s third accelerator, and the organization has a VC fund, San Francisco-based Comcast Ventures — which has invested in the likes of Lyft, Vimeo and Slack and racked up 67 exits, per Crunchbase data.

After completing the SportsTech accelerator, cohort startups could receive series-level investment or purchase offers from Comcast, its venture arm or industry partners, such as NASCAR.

“Our natural discipline right now is…to have early deliverables. But overtime, with our existing partners, we’ll have conversations about who else could be a logical value-add to bring into this ecosystem,” said Bill Connors, Comcast Central Division President.

Quibi execs Jeffrey Katzenberg and Meg Whitman explain their big vision

Last week at the Consumer Electronics Show in Las Vegas, Quibi executives — including CEO Meg Whitman and founder/chairman Jeffrey Katzenberg — took the stage in a keynote laying out their vision for the mobile video service.

Katzenberg is a longtime Hollywood executive who led Walt Disney Studios during its animation renaissance in the late ’80s and early ’90s before co-founding Dreamworks Animation. Whitman worked at both Disney and Dreamworks, but she’s best known as the former CEO of eBay and Hewlett Packard Enterprise.

So it’s fitting that they presented Quibi as a company that exists at the intersection of Hollywood and Silicon Valley — as Whitman put it, creating “the very first entertainment technology platform optimized for mobile viewing.”

Original Content podcast: Netflix’s ‘6 Underground’ is very fun and very dumb

Netflix’s “6 Underground” feels like a movie that belongs on the big screen.

Sure, it isn’t part of a giant franchise (yet), and it doesn’t feature any well-known superheroes — but it does star “Deadpool”‘s Ryan Reynolds as a wise-cracking hero who criss-crosses the globe, going from one spectacularly destructive set piece to another. And behind the camera, you’ve got Michael Bay (who made “Bad Boys” and countless “Transformers” movies) coordinating the action.

On the latest episode of the Original Content podcast, your hosts freely admit that we … enjoyed it?

The movie is spectacularly dumb, but Bay’s approach to action — cut as often as possible and blow up everything — never gets boring. “6 Underground” opens with a fast-paced car-chase that introduces the titular team of international operatives (each of them with their own specific skill), and it follows up with scenes that are even more inventive and/or pulse-pounding.

It also helps that the script comes from “Deadpool” writers Rhett Reese and Paul Wernick, so there’s a glib, profane energy to all of the dialogue, and some of the jokes are genuinely funny.

But your enjoyment will hinge on your ability to turn off your brain — to not be bothered by a plot that’s both laughably slapdash and ridiculously convoluted, or by Bay’s tendency to film women as if their butts were their main features.

And you definitely don’t want think too hard about the core premise, which suggests that the world would be a better place if secretive tech billionaires ignore international law and could force regime change in the Middle East.

You can listen in the player below, subscribe using Apple Podcasts or find us in your podcast player of choice. If you like the show, please let us know by leaving a review on Apple. You can also send us feedback directly. (Or suggest shows and movies for us to review!)

And if you want to skip ahead, here’s how the episode breaks down:
0:00 Intro
0:42 “6 Underground” spoiler-free review
22:49 “6 Underground” spoiler discussion

IAC sells CollegeHumor to executive Sam Reich, resulting in 100+ layoffs

IAC has sold off a majority stake in CH Media, the parent organization behind CollegeHumor . The new owner? CH Media’s chief creative officer Sam Reich.

Reich announced the move on Twitter, saying that digital media holding company IAC “made the difficult decision to no longer finance us,” but that it would allow him to “run with the company.”

He continued, “Of course, I can’t keep it going like you’re used to. While we were on the way to becoming profitable, we were nonetheless losing money — and I myself have no money to be able to lose.”

In fact, Reich said that more than 100 people are losing their jobs as a result.

Bloomberg reports that the company will be left with a team of between five and 10 people. It also reports that IAC will maintain a minority stake in the company.

In a statement, IAC said, “Sam was the best choice to acquire CH Media and define its next chapter. The decision places CH Media with an owner who is beloved by fans, passionate about the business and sees a future we believe in.”

CollegeHumor launched its own subscription streaming service called Dropout in 2018, and Reich said, “The #1 way you can support me is to stay subscribed to Dropout.” He claimed the service still has six months of additional content ready to go, and that it will be launching version 2.0 at the end of this month.

After noting that many Dropout shows may need to take “bold new creative directions in order to survive,” Reich added, “I will, however, do my very best to stay true to the talent, shows, fans, and principles that got us where we are today. We dropped out once before; we can do it again. Independent comedy lives on — just now more independent (gulp) than ever before.”

Quibi’s Jeffrey Katzenberg and Meg Whitman offer a deeper look at the new streaming service

Quibi founder Jeffrey Katzenberg and CEO Meg Whitman took the stage this morning at the Consumer Electronics Show in Las Vegas to offer a deeper look into the technology behind the soon-to-launch mobile streaming service.

The company had already revealed much about its intentions with Quibi, including how it’s the first streaming service designed exclusively for mobile devices, not the living room TV.

But until today’s keynote — and briefings with reporters yesterday — what Quibi hadn’t yet discussed in detail was the underlying, patent-pending technology that takes advantage of mobile devices to push forward a new form of storytelling.

Specifically, Quibi is using a new engineering technology it’s calling “Turnstyle,” which allows the viewer to move between portrait mode viewing and landscape viewing, seamlessly — and without any black bars to fill the rest of the screen when switching to landscape video.

This technology, when demoed, worked very well. The shift from portrait to landscape and back again was smooth and fast — an almost imperceptible transition. And the video in either orientation was crisp, clear and high-def, thanks to the high production values of Quibi’s commissioned projects.

The end result is something that, though watched on a phone, wouldn’t ever be confused with user-gen services like YouTube or TikTok.

“[YouTube] is the most ubiquitous, democratized, incredibly creative platform,” Whitman told me. “But they make content for hundreds of dollars a minute. We make it for $100,000 a minute. It’s a whole different level — it’s Hollywood-quality content.”

On Quibi, there are three tiers of content — unscripted shows, movies delivered in short chapters and “Daily Essentials.”

On the unscripted side, you’ll find documentaries and docu-series, as well as other shows about food, fashion, travel, animals, cars, comedy, sports and more. Daily Essentials, meanwhile, deliver the day’s news and information — including also weather, sports and horoscopes — in five to six-minute “quick bites.”

While these two categories could potentially be delivered on other video platforms, Quibi’s riskier bet is on movies told in chapters. That is, instead of releasing a two-hour film as a single, long video to consume, Quibi movies are told in seven to 10-minute segments. In year one, 35 of Quibi’s total 175 shows will be movies.

Every day, Quibi will deliver one episode of its movies told in chapters, plus five episodes of its episodic and unscripted series and 25 daily essentials. Combined, that’s more than three hours of premium, original content per day.

“If you think about network television, and how much they produce for prime time, it’s 35% more than network TV does Monday through Friday,” Quibi CEO Meg Whitman said.

The service plans to launch with eight movies, and will then release a new movie every other Monday, she noted. But even if you don’t tune in on release day, the content will remain available so you can binge through what you’ve missed.

This idea of shorter-form storytelling is something Katzenberg — a former Hollywood executive best known for his time as chairman of Walt Disney Studios, and for being the “K” in Dreamworks SKG — has been thinking about for decades, he said. Since 1999, in fact.

“I started a little company with [Steven] Spielberg, Ron Howard and Brian Grazer called Pop.com. It lasted about 12 minutes,” he explained, referring to a Quibi precursor that was likely before its time.

“I’ve been a storyteller my whole life. That’s the thing that got me the most interested and excited,” he continued. “And I think what you’ll see is that every great innovation that has happened in Hollywood has actually been driven by a new technology.”

With Quibi’s support for full-screen, high-quality portrait-mode viewing, the service can cater to an on-the-go user base — a user base that often fills spare minutes on social networks or messaging.

But turning the phone is only one way that Quibi will leverage mobile. Spielberg’s Quibi show “After Dark,” for example, will use viewers’ locations to determine what time they can watch the show — it will only be allowed after sunset.

In the future, Quibi’s filmmakers could tap into other mobile sensors and smartphone features, like the GPS or the haptics to make the phone vibrate. They could tell stories through the phone’s messaging system or even have your phone ring as part of a story. An exercise-themed show could tap into the phone’s pedometer for an interactive experience. Turnstyle, in other words, is just step one.

But what Quibi can’t know yet is how users will respond to these sorts of interactions. Will they find them clever, or gimmicky? Will they aid the storytelling experience or ultimately get in the way? And while Quibi wants to bring back the “watercooler” experience of weekly shows, it also doesn’t know if users growing up in the Netflix era will actually watch shows on the release schedule it intends, or save them to binge in longer stretches of time — perhaps even casting them to the TV via Chromecast or Airplay, which Quibi will support.

Despite an overabundance of streaming services, Quibi has attracted big-name talent to help kick off its first year, including Academy Award winners Steven Spielberg, Peter Farrelly and Guillermo del Toro; directors like Antoine Fuqua, Lena Waithe, Sam Raimi and Catherine Hardwicke; and stars like Stephan James, Chrissy Tiegen, Laurence Fishburne, Dave Franco, Bill Murray, Emily Mortimer and Kevin Hart, to name a few.

Quibi isn’t opposed to working with younger creators or even YouTubers, but Katzenberg notes that Quibi won’t be making YouTube shows, but rather Hollywood-style programming.

“If there are good actors and good talent on YouTube who can transition to that, then we’re happy to have them,” he says of the YouTuber crowd. “But it’s highly differentiated…we’re not trying to do a high-end version of what they’re doing. We’re actually trying to bring the ecosystem of broadcast, cable, streaming, television and television storytelling and bringing that to this world,” he notes.

Quibi officially debuts on April 6, 2020 and will cost $4.99 per month with ads or $7.99 per month without ads.

Interested users can sign up to be Quibi Insiders on the service’s homepage, in order to get exclusive looks at new shows and the first news of product updates.

Update: During the presentation, Katzenberg, Whitman and other Quibi executives tried to paint the service as something that sits at the intersection of creativity and technology, and between Silicon Valley and Hollywood.

Whitman described Quibi as “the very first entertainment technology platform optimized for mobile viewing,” adding that, “We needed to make space for creators and engineers to be in the same conversation.”

For one thing, the creators needed to make movies and shows that were viewable in both landscape and portrait mode. CTO Rob Post said the directors and showrunners are actually delivering two edits, one in each orientation, and then Quibi stitches and encodes them together into a single experience, allowing viewers to swap seamlessly.

And Conrad said that when creators started to experiment with Turnstyle, they came up with innovative approaches like the one found in the short film “Nest” and its follow-up Quibi show “Wireless” — where landscape mode features a traditionally-shot thriller, then switching to portrait mode will show you what the main character is seeing on their phone.

The keynote also featured a number of Quibi partners, including Google Cloud (Quibi is using Google’s infrastructure for content delivery) and T-Mobile, which will be bundling Quibi as part of its services (although they didn’t offer specifics). Google and T-Mobile are also among the companies who have supposedly bought out the service’s first year of ad inventory, worth $150 million.

“Quibi is the next big thing,” declared T-Mobile’s incoming CEO Mike Sievert.

CES 2020 coverage - TechCrunch

What to expect in digital media in 2020

As we start 2020, the media and entertainment sectors are in flux. New technologies are enabling new types of content, streaming platforms in multiple content categories are spending billions in their fight for market share and the interplay between social platforms and media is a central topic of global political debate (to put it lightly).

As TechCrunch’s media columnist, I spoke to hundreds of entrepreneurs and executives in North America and Europe last year about the shifts underway across everything from vertically-oriented video series to physics engines in games to music royalty payments. Looking toward the year ahead, here are some of the high-level changes I expect we will see in media in 2020, broken into seven categories: film & TV, gaming, visual & audio effects, social media, music, podcasts and publishing.

Film and TV

In film and television, the battle to compete with Netflix continues with more robust competition than last year. In the U.S., Disney is off to a momentous start with 10 million Disney+ subscribers upon its launch in November and some predicting it will hit 25 million by March (including those on free trials or receiving it for free via Disney’s partnership with Verizon). Bundled with its two other streaming properties, Hulu and ESPN+, Disney+ puts Disney alongside Amazon and Netflix as the Big Three.

Consumers will only pay for so many subscriptions, often one, two, or all of the Big Three (since Amazon Prime Video is included with the broader Prime membership) then a smaller service that best aligns with their personal taste and favorite show of the moment.

AT&T’s HBOMax launches in May with a $14.99/month price tag and is unlikely to break into the echelon of the Big Three, but could be a formidable second tier competitor. Alongside it will be Apple TV+. With a $4.99/month subscription, Apple’s service only includes a small number of original productions, an HBO strategy as HBO gets bundled into a larger library. CBS All Access, Showtime, and NBCUniversal’s upcoming (in April) Peacock fall in this camp as well.

Across Europe, regional media conglomerates will find success in expanding local SVOD and AVOD competitors to Netflix that launched last year — or are set to launch in the next few weeks — like BritBox in the UK, Joyn in Germany and Salto in France. Netflix’s growth in coming from outside the U.S. now so its priority is buying more international shows that will compel new demographics to subscribe.

The most interesting new development in 2020 though will be the April launch of Quibi, the $4.99/month service offering premium shows shot for mobile-first viewing that has already secured $1 billion in funding commitments and $150 million in advertising revenue. Quibi shows will be bite-size in length (less than 15 minutes) and vertically-oriented. The company has poured hundreds of millions of dollars into commissioning established names to create dozens of them. Steven Spielberg and Guillermo del Toro each have Quibi programs and NBC and CBS are creating news shows. The terms it is offering are enticing.

Quibi, which plans to release 125 pieces of content (i.e. episodes) per week and spend $470 million on marketing this year, is an all-or-nothing bet with little room to iterate if it doesn’t get it right the first time; it needs hit shows that break into mainstream pop culture to survive. Billionaire founders Jeffrey Katzenberg and Meg Whitman have set expectations sky-high for the launch; expect the press to slam it in April for failing to meet those expectations and for the platform to redeem itself as a few of its shows gain traction in the months that follow.

Meanwhile, live sports remains the last hope of broadcast TV networks as all other shows go to streaming. Consumers still value watching sports in real-time. Streaming services are coming for live sports too, however, and will make progress toward that goal in 2020. Three weeks ago, DAZN secured the rights to the 2021/22 season of Germany’s Champions League, beating out broadcaster Sky which has shown the matches for the last 20 years. Amazon and YouTube continue to explore bids for sports rights while Facebook and Twitter are stepping back from their efforts. YouTube’s “YouTube TV” and Disney’s “Hulu with Live TV” will cause more consumers to cancel cable TV subscriptions in 2020 and go streaming-only.

The winners in the film & TV sector right now are top production companies. The war for streaming video dominance driving several of the world’s wealthiest companies (and individuals) to pour tens of billions of dollars into content. Large corporations own the distribution platforms here; the only “startups” to enter with strength — DAZN and Quibi — have been launched by billionaires and started with billion-dollar spending commitments. The entrepreneurial opportunity is on the content creation side — with producers creating shows not with software developers creating platforms.

Gaming

The gaming market is predicted to grow nearly 9% year-over-year from $152 billion globally in 2019 to $165 billion in 2020, according to research firm Newzoo, with more than two billion people playing games each year. Gaming is now widespread across all demographic groups. Casual mobile games are responsible for the largest portion of this (and 45% of industry revenue) but PC gaming continues to grow (+4% last year) and console gaming was the fastest growing category last year (+13%).

The big things to watch in gaming this year: cross-platform play, greater focus on social interaction in virtual worlds and the expansion of cloud gaming subscriptions.

Fortnite enticed consumers with the benefits of a cross-platform game that allows players to move between PC, mobile and console and it is setting expectations that other games do the same. Last October we saw the Call of Duty franchise come to mobile and reach a record 100 million downloads in its first week. This trend will continue and it will spread the free-to-play business model that is the norm in mobile games to many PC and console franchises in the process.

Gaming is moving to the social forefront. Many people are turning to massively multiplayer online games (MMOs) like Fortnite and PUBG to socialize, with gameplay as a secondary interest. Games are virtual worlds where players socialize, build things, and own assets much like in the real world. That results in an increasingly fluid interplay between socializing in games and in physical life, much as socializing in the virtual realms of social apps like Instagram or Twitter is now viewed as part of “real world” life.

Expect VCs to bet big on the thesis that “games are the new social networks” in 2020. Large investment firms that a year ago wrote off the category of gaming as “content bets” not fit for VC are now actively hunting for deals.

On this point, there are several startups (like Klang Games, Darewise Entertainment, Singularity 6 and Clockwork Labs) that raised millions in VC funding to create open world games that will launch (in beta at least) in 2020. These are virtual worlds where all players exist in the same instance of the world rather than being capped at 100 or so players per instance. Their visions center of digital realms where people will contribute to in-game economies, create friendships and ultimately earn income just like their “real-world” lives. Think next-gen Second Life. Expect them to take time to seed their worlds with early adopters in 2020 before any of them gain mainstream traction in 2021.

Few are as excited about social interaction in games as Facebook, it seems. Eager to own critical turf in the next paradigm shift of social media, Facebook will accelerate its gaming push this year. In late 2019, it acquired Madrid-based PlayGiga — which was working on cloud gaming and 5G technology — and the studio behind the hit VR game Beat Saber. It also secured exclusive rights to the VR versions of popular games like Ubisoft’s “Assassin’s Creed” and “Splinter Cell” for Oculus. Horizon, its virtual world for social interaction within VR, is expected to launch this year as well.

Facebook is betting on AR/VR as the paradigm shift in consumer computing that will replace mobile; it is pouring billions into its efforts to own the hardware and infrastructure pieces which are several years of R&D away from primetime. In the meantime, the consumer shift to social interaction in virtual worlds is occurring in established formats — mobile, PC, and console — so it will work to build the bridge for consumers from that to the future.

Lastly, cloud gaming was one of last year’s biggest headlines with the launch of Google Stadia and you should expect it to be again this year. By moving games to cloud hosting, consumers can play the highest quality games from lower quality devices, greatly expanding the market of potential players. By bundling many such games into a subscription offering, Google and others hope to entice consumers to try many more games.

As TechCrunch’s Lucas Matney argued, however, cloud gaming is likely a feature for existing subscription gaming platforms — namely Playstation Now and Xbox Game Pass — more so than the basis for a new platform to differentiate. The minor latency inherent in playing a cloud-hosted game makes it unattractive to hardcore gamers (who would rather download the game). Next to Sony and Microsoft’s offerings, Stadia’s limited game selection fails to stand out. The competition will only heat up this year with the entry of Amazon. Google needs to launch the Stadia integration with YouTube and the Share State feature that it promoted in its Stadia announcement to really drive consumer interest.

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