Pay TV Eyes Web Video as a Millennial Draw

Pay TV providers are beginning to incorporate Web video into their TV products. In doing so, they are hoping to keep viewers from seeking other platforms to find and watch Web video on the TV set.

Gracenote had a surprising reveal at IBC this year: it is now cataloging what it calls “digital-first” video content for integrating into EPGs.

Gracenote is a metadata company that supplies information about programming to pay TV providers to use in EPGs.

 

Gracenote EPG

Gracenote’s EPG: now with multiple short-form video content

 

The company said it’s doing this in response to pay TV providers being interested in adding short-form video to content offerings on pay TV STBs.

There’s already a precedent for this in pay TV in Europe, and in the US. In Europe, Liberty Global’s UPC Hungary has placed YouTube on its pay TV STB, and was surprised to learn that its subscribers actually used the app. App session averaged around 45 minutes per day, it has said.

The pay TV industry in the US is on shaky ground, after a shocking second quarter that saw the industry collectively lose over 500,000 subscribers, a potential harbinger of more losses to come. Pay TV providers are looking at ways their products can be more attractive to younger viewers such as Millennials, whose eldest are now forming households – without pay TV subscriptions.

One answer: Web video.

YouTube’s meteoric rise helped it define an entirely new form of video entertainment.

Short-form, Web-delivered video has proven so powerful among the “Internet generations” of Millennials and Generation Z viewers that TV networks are buying Web video networks in order to reach those audiences that have almost completely stopped watching linear TV.

And just as content owners have realized they need to create this type of content now in order to remain relevant to both viewers and advertisers, pay TV providers are learning that they’ll need to start aggregating this type of content in order to keep their business – aggregating entertainment channels and delivering them to subscribers’ TV sets – afloat over the next decade.

In the US, Dish Network has incorporated Vevo apps onto its Hopper DVRs, as well as Netflix apps. Dish Network’s Internet TV service, Sling TV, also offers two channels of Web content as part of its core package: both owned by Disney’s MCN Maker Studios.

And Verizon’s new mobile-centric OTT service Go90 incorporates video from AwesomenessTV and Vice – both Web video networks – with traditional TV fare such as sports and A&E programming.

But the most direct and striking example of this trend is Comcast’s Web video portal, Watchable. Reports indicate the service, which hasn’t officially launched yet but is being tested, will focus on curated playlists of premium short-form video from the Web; Comcast has partnered with Web content publishers such as Vox, BuzzFeed and others for the service, and will share revenue with them.

Gracenote has said its currently cataloging only the premium short-form Web video, meaning content from the top MCNs, those now owned by traditional media firms, and the short-form video being created by the content owners themselves, such as Scripps’ Ulive network, Discovery’s many Web video sites, or the short-form content produced by Comedy Central’s digital division.

Incorporating these digital video networks into pay TV products is a natural evolution for pay TV service providers, who already carry the above programmers’ linear TV channels.

Another important component to both Comcast’s and Verizon’s web video products is that they are or will be made available nationwide, not only made available to their respective pay TV or wireless customers (in the case of Verizon).

On the one hand, that’s likely because these types of ad-supported Web video services need scale – huge scale, like YouTube’s scale – to generate meaningful revenue. But it’s also indicative of how the Internet has changed not only logistics of delivering services across the country or globe, but how it’s changed consumer expectations about services. Why would any Web-video product ever be limited to a service provider’s physical footprint?

“If you don’t disrupt yourself, someone else will disrupt you,” said Verizon’s CEO Lowell McAdam, speaking at …

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