Editor’s Corner—Google, consolidation and other media industry narratives from CES 2018

Las Vegas skyline facing south
CES 2018 was held Jan. 9-12 in Las Vegas. (Sky_Sajjapho/iStock/Getty Images Plus)
Ben Munson

LAS VEGAS—Another Consumer Electronics Show is wrapping up and attendees have likely moved past the indignity of rain in the desert and the bitter irony of losing power at an electronics show.

What’s left is the TVs. By god … the TVs. Huge TVs, thin TVs, 8K TVs, TVs that roll up into a box, a TV canyon, they were all there. But at CES, mostly away from the show floor, the topic of discussion was often about what people watch on those TVs.

Across numerous keynotes, panels and interviews with media and entertainment industry luminaries, some key themes repeatedly emerged at CES. Here are some of the highlights:

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More media consolidation is on the way

At the rate massive media deals rolled in during 2017—Sinclair bought Tribune, Discovery bought Scripps, Disney bought Fox and AT&T’s deal to buy Time Warner morphed into a legal drama—and considering all the attention they received, it’s no surprise that other companies want in on the action.

During a keynote discussion Wednesday, Aryeh Bourkoff, founder of LionTree, an investment firm specializing in media, called it a golden age for mergers and said that recent M&A deals in media and entertainment reflect changing consumer behavior and companies’ need to realign in order to address those changes.

“We’re effectively living in an a la carte environment,” said Bourkoff, which he said is good for companies that have scale. But he said niche companies will need to partner up in order to survive.

Nancy Dubuk, president and CEO of A+E Networks, concurred during a separate keynote panel that 2018 is going to be another big merger year for companies looking for horizontal scale or vertical integration. But she also warned that, given the rate M&A has been going lately, there aren't many combinations left.

Jefferies analyst John Janedis this week lent some credence to those views: “We expect the AT&T/TWX deal to close. However, we think other potential bidders like VZ or CBS could emerge if the deal breaks. With the list of potential partners shrinking and digital players getting more powerful, we expect more convergence/consolidation across our coverage in '18,” wrote Janedis in a research note.

A digital giant is coming for video

At this year’s CES, Google cast a new and relatively ubiquitous shadow over everything, including video. Of course, Google’s YouTube has been a massive player in the video space for years, but now the company’s recently launched virtual MVPD YouTube TV is beginning to emerge as a leader in the space.

“On the video side, lots of positive buzz around YouTube TV, which to us appears well-liked by those in the media/ad industries and is already being viewed by many as the most credible offering within the streaming space,” wrote Jefferies’ Janedis.

Around the show, YouTube executives discussed the company’s successful strategies.

Neal Mohan, chief product officer at YouTube, said that 10 years ago, users would just search YouTube for the content they wanted, get it and then get out. Now he said that more than 70% of watch time on YouTube’s platform is driven by recommendations, and that it has helped push the average watch time on YouTube’s mobile app to more than 60 minutes per visit.

At a separate keynote panel, Robert Kyncl, chief business officer at YouTube, revealed a bit of YouTube’s programming strategy. He said that there were a billion views of Karate Kid content on the platform, so the company knew that rebooting Karate Kid as a series was a good idea.

Of course, the idea of Google encroaching further on TV distribution and programming may not be a welcome sign for everyone in the industry. During a keynote discussion, Turner CEO John Martin likened Google and Amazon to utilities that don’t generate the same sort of human response from users as does well-produced television.

“Nobody has a deep connection with their search history or their shopping cart,” Martin said.

The ‘TV isn’t dead’ narrative is still not dead

Nearly as tiring as the recurring “TV is dead” proclamations that pop up at shows like CES is the ongoing response dialogue, amounting to “No, it’s not.”

Ben Sherwood, president of the Disney/ABC Television Group, planted himself firmly and unsurprisingly in the “TV is not dead” camp. He proved it during his talk at Variety’s Entertainment Summit at CES.

“The sky is not falling. I think the sky is rising,” said Sherwood, according to Multichannel News.

At another panel during Variety’s event, Erin McPherson, head of content strategy, acquisition and programming at Verizon, said tales of TV’s demise were exaggerated. Instead, she said that the idea of TV and how and where it’s consumed is evolving along with consumers’ changing habits. Now companies are working to meet viewers where they’re at.

That’s evident in the words of Maggie Suniewick, president at NBCUniversal Digital Enterprises, who on the same panel described NBC’s content work across platforms like Facebook, Snapchat and YouTube. It’s also evident in the effort programmers like CBS and Disney are exerting to push their content beyond the traditional TV ecosystem.

I know I’ve railed against the futility of the “TV’s not dead” discussion before, and I risk sounding like a broken record doing it again here. But I believe it would be better—and a more advantageous use of conference keynote time—to simply discuss TV, in all of its incarnations, as if the audience accepted it as an important part of the media landscape and not an endangered species.—Ben | @Fierce_Video