AMAZON LANDS NFL LIVE STREAMING . . . BUT AT A PRICE: Last Tuesday I featured a blog post about the increased competition among digital publishers to carry live sports as exclusive content. In 2016 Twitter blazed a trail by live streaming select NFL games at a licensing cost of $1M/game. This year several major publishers bid on the NFL’s streaming rights and Amazon came out on top. For a $50M price tag they’ll have exclusive streaming rights to the 10 Thursday night games – which is 5x the rate Twitter paid last year. On the surface this looks like an impossible monetization equation for Amazon. Given the limited inventory they’ll have to sell, and the usually craptastic games which run on Thursdays, it’s hard to envision a profitable ROI. But Amazon is probably thinking about a larger play here. By adding NFL games to the list of content available with an Amazon Prime subscription they can keep driving their overall subscriber base up. So it feels more like an investment spend towards a longer term content-based strategy.
TOTAL MARKETING DEBUNKED: If you work on the Multicultural (especially Hispanic) side of our industry you’re familiar with the raging debate over a concept called Totally Marketing. The underpinnings of the TM strategy is the belief that US Hispanics have begun to assimilate into American culture and are now speaking more English than ever. So marketers no longer need to run a separate Spanish language marketing campaigns to reach this audience. Instead they can run a one size fits all “total market” campaign, which conveniently saves money because they’re only running one campaign instead of two. There have been dozens of research pieces put out over the years disproving the TM theory. The attached Forbes article is one of the better ones I’ve seen on the topic because it brings hard stats to the importance of language and cultural relevancy within Hispanic marketing. It’s an important piece which may help turn the tide against Total Marketing.
WILL BROADCASTERS HAVE TO START PAYING TO PLAY?: As previously mentioned, the RIAA has begun fanning the flames around the idea of radio stations paying performance royalties for music broadcast on their terrestrial transmitters just as they do on the streaming side. Yesterday the talk started to turn into action when California Congressman Darrell Issa introduced a piece of legislation which would give artists the ability to opt out of having their songs played on radio if broadcasters don’t pay royalties. And the artists could make this decision on a song by song basis. This framework would test radio’s argument that their promotion of new music is essential to the discovery process, which is why they’ve been exempt from paying royalties in the first place. So this legislation would effectively call the bluff on both sides of the argument. Because if artists really need radio to break new songs they’ll voluntarily wave their royalties claim. On the other hand if a song can be successfully promoted without using radio then broadcasters will have to pay royalties just like everyone else. It’ll be very interesting to watch this one play out in DC.
Have a great Thursday guys!