Project OAR is “actively in talks” with other TV makers and has issued invitations to join the consortium, a Vizio spokesperson emailed us Wednesday, after Tuesday's announcement (see 1903120071) its Inscape technology is at the heart of the Open Addressable Ready standard for targeted advertising via connected TVs. OAR was formed last year with founding members CBS, Disney's Media Networks, Comcast's FreeWheel and NBCUniversal, Xandr, Turner (now part of AT&T), Discovery, Hearst Television, AMC Networks, Vizio and Inscape. The charter is to “deliver better advertising experiences to viewers” through dynamic commercials on internet-connected TVs and devices. There’s no exclusivity period for Vizio or any other network or platform member, the spokesperson said: The working group was “formed under the concept that a rising tide lifts all boats." On whether any modifications will be required to TV designs to accommodate the standard, he said the group is working on specifications that allow for easiest adoption, and "it's too early to tell if any changes will be required." Viewers will be given the option to participate in addressable, "and they may subsequently opt out if they choose," he said. On whether consumers would lose access to certain features or functionality if they opt out, he said the goals are more relevant ads and better viewing experience.
Apple continues to give itself “an unfair advantage at every turn,” said Spotify CEO Daniel Ek in a Wednesday blog post. His company's antitrust complaint against Apple was filed Monday with the European Commission.
As cord cutting erodes the advertising-supported TV model, Vizio and media companies banded together to develop an open standard for “addressable advertising” on connected TVs. Project OAR, for Open Addressable Ready, is working to define technical standards for TV programmers and platforms to deliver “more relevant” ads within linear and on-demand on smart TVs, it said. The standard is designed to deliver “enhanced advertising products to brands, making the ad-supply chain more efficient, and giving audiences advertising content they are more likely to watch and enjoy,” it said.
The rise of vMVPDs over the past four years “helped mute the pressure” on TV networks from cord-cutting, but a slowdown in vMVPD subscriptions is clouding the future, BTIG's Rich Greenfield wrote investors Monday: Low retail pricing resulted in negative gross margins given how programmers “force large bundles of their channels on both MVPDs and vMVPDs.” Two of the top four vMVPDs are reversing course: Dish Network's Sling growth “slowed dramatically over the past year” and AT&T's DirecTV Now lost 14 percent of its subscriber base last quarter, the analyst noted. Growth is continuing at Hulu Live and YouTube TV, but Greenfield questioned how Disney’s expected acquisition of much of 21st Century Fox in the next few weeks could affect Hulu Live. Disney has a stake in Hulu, as do Fox and others. “That leaves YouTube TV, which has best-in-class technology, a superior user experience and a deep-pocketed parent that can sustain losses for years-to-come,” Greenfield said of the Google affiliate. Greenfield questioned why distributors don’t partner with YouTube TV. Verizon did so tied to its 5G launch. DirecTV Now reportedly is rolling out a $10 price hike and two new packages that remove AMC, Discovery, Scripps and Viacom-owned networks. DirecTV didn’t comment.
Pay TV’s subscription exodus continued last year, widening to 2.9 million from 1.5 million in 2017, reported Leichtman Research Group Wednesday. Satellite-TV providers suffered the most losses at nearly 2.4 million, shared by DirecTV with a 1.2 million drop and Dish Network TV at 1.1 million. Comcast led cable company declines at 371,000, followed by Charter Communications at 244,000. AT&T U-Verse was the lone gainer among MVPDs, gaining 47,000 subscribers, while Verizon FiOS shed 168,000 and Frontier Communications 123,000. “AT&T’s programming contracts no longer incented them to get a DIRECTV customer rather than a U-verse, or to switch someone from U-verse to DIRECTV, so they went back to focusing on the bundle in the U-verse footprint,” analyst Bruce Leichtman emailed us. VMVPDs gained 641,000 paying customers. Of the top video providers, cable had 47 million subscribers, satellite 29.1 million, telcos 8.9 million and vMVPDs 4 million. Since the industry’s peak in Q1 2012, pay-TV subscriber count has declined by 6 million, with 10 million traditional MVPD subscriber losses offset by about 4 million adds for publicly reporting vMVPD services.
Cloud-based telecom company Ooma is looking toward subscription services to drive residential and commercial revenue growth, said Chief Financial Officer Ravi Narula on a Q4 earnings call Tuesday. Revenue for the quarter ended Jan. 31 was up 15 percent year on year to $34.7 million, 89 percent from subscriptions and services. Product revenue, which recently hovered around $12 million-$13 million, is expected to be flat from FY 2019 to 2020, while the company eyes near-term subscription revenue growth from business and residential. CEO Eric Stang said development plans are shifting to new premium services the company can enable through its office platform, and its partnership with Sprint, announced at CES, for a 4G wireless home phone that doesn’t require an internet connection will play a bigger role in the broader company portfolio over time. The company is expanding its Telo residential phone service into home security, and its $149 indoor/outdoor Smart Cam, launched at CES, has had a good "take rate" with additional services on Amazon, said Stang: “We always like it to be higher, but it's gotten off to a good start." Shares closed down 0.1 percent to $16.04.
Energous maintains exclusive rights to all intellectual property in its technology, with the exception of a 2015 development and licensing agreement with a “top-tier consumer electronics company” described as one of the top revenue-producing CE companies in the world, it said in its annual report filed with the SEC Wednesday.
Energous’ prospects for generating meaningful revenue from deliverables for its wireless charging technology took another hit in Q4 due to customers’ decisions to extend review processes, said CEO Steve Rizzone on a Wednesday earnings call. Rizzone had referred on previous calls to a “large engineering services payment” in conjunction with delivery of the first iteration of a system Energous had been developing to spec for a "key strategic partner," but it couldn’t invoice for delivery due to the customer's decision to extend the review and acceptance cycle. “We have no guarantee that they will integrate this technology at all, even though the relationship continues to move forward,” Rizzone said. A second CE company planned a Q2 2019 product launch, which would have “triggered a meaningful order” in Q4 for manufacturing ramps that didn't occur. That customer is refining its specs to improve its product's user experience and competitive position, said Rizzone, saying Energous expects a Q2 chip order. The company announced Wednesday a direct securities offering of $25 million, less $1.7 million in expenses, to finance working capital and other general and administrative purposes. The company’s Q4 revenue was $56,000; net loss was $12.5 million, it said. Shares plunged 24 percent Wednesday at $6.21. Rizzone highlighted positive news -- availability of the Oasis-RC personal sound amplification product from Delight and vivo’s Mobile World Congress announcement (see 1902250053) it plans to incorporate Energous’ distance charging in a future smartphone. More negative news came from the regulatory front where approvals for wireless charging distance technology in Asia “are extending out.” Rizzone has expressed hope that FCC approval in December 2017 (see 1712270024) would be a model for regulators in Japan, Korea and China, but those countries chose to do their own studies along the same lines as the FCC approval process, he said Wednesday. At CES last month, Energous demonstrated its wireless charging technology in prototypes from Vuzix, Qubercomm, IDT, Austar and Deutsche Telekom.
Best Buy shares closed up 14 percent to $68.82 Wednesday after a better-than-expected fiscal Q4 earnings report showing a 3 percent year-over-year hike in comparable sales. Enterprise revenue was $14.8 billion over 13 weeks vs. $15.3 billion in a 14-week year-ago quarter. Domestic comp sales grew 3 percent. A 3.5 percent revenue decrease to $13.5 billion was driven by the lost week and closing 257 Best Buy Mobile and 12 large-format stores over the year, said Chief Financial Officer Corie Barry. She estimated the extra week last year brought in $760 million in sales.
Wireless charging is in the news at Mobile World Congress (see 1902250016) this week, as Energous announced a collaboration with vivo Global to explore integrating WattUp into smartphones that charge wirelessly over the air. Mark Tyndall, general manager-emerging products business group at Dialog Semiconductor, which makes Energous chips, cited vivo’s appeal to younger users and its “innovative approach to solving use pain points” such as charging.