Time Warner 2Q04 July 29, 2004Posted by David Card in Uncategorized.
Time Warner had a solid quarter. Overall revenues grew 10%, to $10.9 billion. Filmed Entertainment outgrew the other businesses, while AOL at 2% and Time Inc. at 4% were the slowest performers. TWX raised guidance for the year, but warned that tough comparisons with last year will mean slower Q3 growth.
Highlights from the earnings call:
– AOL ad revenue grew year over year for the first time since 3Q01. Advertising grew 23% to $221 million; $72 million of that was paid search, which grew 76%. AOL expects to have positive ad revenue growth for the full year, even without adding in the Advertising.com acquisition.
– AOL actually gained 85,000 paying subscribers, but “total membership” was down 668K due to losses in trial and retention licenses. The company said this big number was seasonal. Details are here.
– 3.6M BYOA for Broadband subs at the quarter’s end, up from 2.8M in Q1. About 40% of them are the $24.95 package that includes unlimited dial-up. The company said most of the net additions were for this package.
– AOL has 2.9 premium services subscribers, up from 2M at the end of Q1.
Cable and Broadband
– 4.6M digital subs; 42% of basic video subscribers. 124K net additions are seasonally weak.
– Monthly ARPU was over $75; up 10%.
– 1.3M SVOD subs; 28% of digital
– 600K DVR subs; just under 13% of digital
– 3.5M broadband (residential) subs; 19% of eligible homes passed. Roadrunner is growing well while the AOL broadband bundle is no longer actively marketed, and is losing customers. There are still 200K left.
– VOIP has paying customers in 15 of 31 systems (up from five in Q1), and seven other systems are in trial. In Raleigh, 70% of the VOIP users are in a triple-play package.
– No intention to cut cable bundle prices; no intention to take Time Warner Cable public.
– Ad revenues up 8% at Turner; up 6% overall. Pretty strong upfront and scatter market.
WSJ Fixes DRM July 29, 2004Posted by David Card in Uncategorized.
The Journal seems to have fixed its log-in glitch. All is well. Good work, fellas.
Bad DRM, Bad, Bad July 28, 2004Posted by David Card in Uncategorized.
The Wall Street Journal seems to have implemented a new log-in policy that’s bad news.
Presumably to cut back on illegal subscription sharing, the Website now forces you to log off if you want to access your subscription on a different computer. So, for instance, if you forget to log off at work – a two step process – and just shut down your browser, when you try to log on at home, you won’t be allowed to. You can’t re-log on, you just get a message saying someone else is using your account. And the WSJ default when you log on is to remember your ID and password, so you’re encouraged to stay “on.”
This new system is horribly inconvenient and bound to confuse legitimate paying customers. A simple timing-out process, after a period of inactivity, would fix it. Even forcing a user to log on for each session would be better.
Plug.IN: Report from the Front Lines July 26, 2004Posted by David Card in Uncategorized.
Some tidbits from Plug.IN, our ninth annual music conference. Some say tenth, but I don’t really think so…..
We released the highlights of our digital music forecast.
Driven by downloads, digital music sales will nearly double in 2004 to reach over $270 million. Over time, digital subscriptions will be a bigger market than downloads, and the two will combine to total $1.7 billion in 2009, or 12 percent of consumer music spending. Neither digital markets nor online sales will restore music spending to its 1999 heights.
Digital music is not a replacement for the CD in the foreseeable future; neither are any of the new physical formats. The US music industry must manage digital music as one of a series of incremental revenue streams—one that is on the same scale as licensing (e.g., ring tones, games, advertising)
Charles Goldstuck, president and COO of BMG Music North America, presented a reasoned take on the music business from the label perspective. Though US sales are promising, global markets are not, so he expects another down year. More cost-cutting, more artist roster rationalization. Because of that, there’s the potential for indie labels to sneak in. He’s looking at promising developments in ringtones, DVD music, and Microsoft’s entree into the digital music store business. Three primary issues for the next 24 months: piracy still no. 1 priority; labels and publishers have to work out licensing (nix on compulsory! and no boos from the crowd); DRM interoperability is a necessity.
RealNetworks sort of announced Harmony. They’ll demo it tomorrow morning.
Apple was a no-show due to illness. Last year, Plug.IN was the iPod/iTunes show, this year it’s all about everybody else talking behind their back.
Digital Music panel agreed nobody can make money from 99-cent singles – subscriptions and corporate sponsorships seem to be the cure. Users still seem to be 30+ and male, though only 2/3 male these days (Musicmatch, MusicNet, Rhapsody). Sony’s seen some kids buying. More interest than usual in playlists and community. No consensus on whether there will be 1, 3, or 10 survivors.
Music Discovery panel exposed some interesting tension between using algorithms, human editors/DJs, or fans, for programming. No one seemed to want to take record label promotional money. (What are they, crazy?) Seemed to be near-consensus on the necessity of Web radio programming variety, plus community/recommendations etc. as big tools to best use Internet to market music. But no one onstage is aggressively using affiliates, and it seemed to me that Internet marketing efficiencies are again being shortchanged.
Blockbuster on the Cheap? July 23, 2004Posted by David Card in Uncategorized.
Nothing really new in this Journal story, but it continues the saga of how difficult it is to create blockbuster hits. The summer tentpole – esp. if it has franchise potential – is so seductive that Hollywood (in this case, Universal) keeps taking $100 million-plus shots. The Bourne series is an example of a disciplined, mid-priced hit.
Boomer Music Buyers July 21, 2004Posted by David Card in Uncategorized.
One more sign that geezers – er, Boomers – can buy a lot of music. Jimmy Buffet debuts at No. One. Our upcoming Music forecast shows some of this influence, and our annual Music survey will too.
Technically, I’m a Boomer. A trailing-edge Boomer. Why the market research industry thinks I have anything in common with someone born in 1947 is beyond me. Grumble, grumble.
NYTimes Playing Race Card?? July 20, 2004Posted by David Card in Uncategorized.
I am baffled by the Times story on Catwoman. It seems to think that, after being the first black woman to win a best actress Oscar, Halle Berry is about to prove whether a black woman can open a big-budget, effects-laden, would-be summer blockbuster.
In the zero-sum calculations of the movie industry, Ms. Berry’s bankability as a star will be judged largely on whether she can “open” “Catwoman,” a Warner Brothers film — meaning whether she can make it a financial winner. If it succeeds, it will place her among a rarefied group of top-paid female stars, only a few of them established box office draws, and signify yet another achievement for African-American actors.
This is less than silly. The question is, can a woman open a open a big-budget, effects-laden, would-be summer blockbuster. (One wonders why this is an interesting question, but that’s another topic.)
It has nothing to do with race. Will Smith is the closest thing to an action-hero guarantee. (Denzel’s never done the special effects thing.) It sure isn’t Ben Affleck. Okay, maybe Keanu and Tom Cruise are fairly safe bets. Mel Gibson and Harrison Ford are too old. Jackie Chan and Jet Li didn’t pan out in the US. Please don’t even mention Vin Diesel or hobbits or Tobey Maquire.
But Angelina Jolie failed with the Tomb Raiders; Milla Jovovich failed with Resident Evil; a cartoon failed with Final Fantasy (hey, maybe the problem is videogame heritage); Brigitte Nielsen failed with Red Sonja; etc. etc. But what of Sigourney Weaver and the Aliens series, you ask. The first movie didn’t open big – it built over time Its opening weekend comprised 7% of total box office, compared to Spider-Man’s 28%, or Batman’s or the first Matrix’s 16%, according to Boxofficemojo, my new favorite site.
Media Covering Media Follies, Part XXXVII July 19, 2004Posted by David Card in Uncategorized.
Oh my, the mighty media fell for a Sci Fi Network hype-umentary. Now they’re saying Sci Fi “lied.”
Who could possibly think a promotional “documentary” where:
Actor Adrien Brody, a star of “The Village,” is interviewed in the documentary saying that he was sworn to secrecy about everything in the movie. Asked if he had short or long hair in the film, he refused to answer.
could possibly have been – gasp – guerrilla marketing!?! How could something broadcast on a nearly-nationally available cable net be “guerrilla?”
At the Risk of Gloating July 19, 2004Posted by David Card in Uncategorized.
What a collection of losers . Funny, my parent company has a lean and mean Web-only publishing arm – in freaking New York, not Silicon Valley – that not only survived, but is profitable. Not that I’m gloating or anything. Oh, no, not at all.
How Can You Malign Hydrangeas? July 18, 2004Posted by David Card in Uncategorized.
According to abcnews.com, Martha Stewart tells Barbara Walters “We’re all little people,” and that she feels sympatico with Nelson Mandela:
“I can sleep on the ground.… If it is looming ahead of me, I’m going to have to face it, and take it and do it and get it over with. And there’s many other people that have gone to prison. Look at Nelson Mandela.”
She feels she might have been unfairly targeted because of her TV presence:
“I was on television 21 times a week with my wonderful, award-winning, Emmy-winning, how-to television program that was such a nice alternative to other things that are on television. This program teaches. This program informs. This program promotes crafts, and artisans, and artists, and paper makers, and gardeners, and hydrangeas. … How can you malign something like that?”
Or maybe because some nameless conspiracy is anti-celebrity:
“I think that it really could happen to pretty much anybody. It really could. More to a well-known person, a celebrity, … or someone like I am, who’s built this fantastic business … to bring them down a notch. To scare other people. This is what it’s all about.”
AOL members sort of agree with her. In a poll I saw at 5pm Sunday, 58% agreed her success and fame hurt her case, while 19% said it helped. Meanwhile her audience is split: 45% have no sympathy for her, while 34% have a lot, and 21% a little.