As TVNZ.co.nz launches livestreaming, some free advice on how to make money

TVNZ.co.nz is getting new features today. The key elements of the revamp:

• Live TV streaming 1, 2 and Duke (720p HD resolution)
• Mobile optimised
• Simplified navigation
• A new video player
• Integration for social feeds and content
• Extended viewing windows (that is, series will be available online for longer)
• More stacking of episodes and box sets

Support for Chromecast from July and an Apple TV app around August. Both will make it a lot easier for lay people to get TVNZ.co.nz content on to a regular telly.

One thing that hasn't changed is the "bumpers", those annoying "pre-roll" adverts that get in your face ahead of a clip (NBR View has banned them, incidentally). You even see a bumper before the livestream starts (and, today, in the grand tradition of bumpers being on high-rotate, it's a KFC Double Down ad that's being mind-numbingly repeated).

And you still have to register before you can watch. TVNZ chief executive Kevin Kenrick tells NBR that's to allow personalisation features, such as starting to watch a clip on one device, and finishing in on another. It also allows for more targetted ads, he says.

That’s all good (apart from the bumpers).

The only thing you could say about the introduction of most of those features is: Why did it take so long?

The answer, of course, is that TVNZ makes almost all of its money from advertising, and online advertising around on-demand content is a cruel territory with a fraction of the yield of broadcast TV.

On this point, I’d encourage TVNZ (and MediaWorks) to look to Hulu in the US, a livestreaming and on-demand video venture co-operatively owned by ABC, NBC, Fox, Time-Warner and others.

Hulu lets you pay $US11 a month for an ad-free version of its service. Given how intensely annoying “bumpers” or “pre-roll” ads are for online video (especially given the high repetition), it’s no surprise Hulu now has 16 million subscribers and more than 35 million viewers.

TVNZ.co.nz should ditch bumpers for a few, subtly placed watermarks from advertisers, introduce a paid ad-free option (I’d pay $10 a month for it) and introduce a charge for premium content – such as the Hulu original series The Handmaid’s Tale, which was snaffled up by Lightbox. [UPDATE: NBR has now had the opportunity to run this idea past TVNZ CEO Kevin Kenrick; he reckons it won't work for countries with below 30 million people.]

The tricky bit
TVNZ chief executive Kevin Kenrick recently announced the state broadcaster would need to "reset" its cost structure to achieve significant savings in the new environment. 

Redundancies followed.

No one is arguing with the need to remodel. 

But here's the thing: Netflix, Amazon Prime, Google Play and others are emerging as global players. It will become harder and harder for TVNZ to find any exclusive entertainment content.

The only way to stand out will be to provide more local news, and more local drama, reality shows and sport.

That will cost more money, and require more people, just as the board is looking to trim budgets and slim down staff.

STREAMING VIDEO CONTENDERS

Beyond TVNZ, MediaWorks and Sky making some of their broadcast content available via streaming or on-demand online, there is an ever-growing number of new media contenders. A field guide to some of the larger ones:

Amazon Prime: Owned by Amazon, the giant internet retailer. There are 69 million Prime subscribers, though it's not clear how many are joined for the video (in the US, being a Prime member also includes other perks such as discounted delivery).  Launched in New Zealand late last year, albeit with a slimmer lineup of content than that available to Americans. Costs $3 a month for first six months, then $US6. Only a seven-day trial compared to the 30 days offered by rivals. 

Fanpass: Owned by Sky. Gives non-Sky TV subscribers access to Sky Sports channels 1-4 on a monthly ($99) or six-monthly ($320) pass. Also used for pay-per view events. Recently added an Apple TV app. Recently got users hot under the collar by ditching its low-cost daily and weekly passes.

HBO Now: Owned by Time Warner. An intriguing development, the HBO NOW app cuts out middle-men old (pay TV networks) and new (like Netflix) to deliver HBO shows directly to consumers. Geo-blocked to New Zealanders, and on launch it made quite an aggressive effort to weed out non-US subscribers (members had to prove they lived in the US or got kicked off). Available as an app through Apple TV and Amazon Fire TV, among other avenues. $US15 a month. 

Hulu: Cooperative owned by Disney-ABC, NBC Universal, Fox and Time Warner. Where Netflix features its own shows and back-catalogue content, Hulu has an emphasis on shows screening now in the US on the major networks – although it is increasingly adding original series too. $US8 a month with ads, $US12 a month without ads. Available as an Apple TV app.

Lightbox: Owned by Spark. Free to Spark broadband customers, $12.99 a month for others. Good selection of TV series but no movies. Its sister service, Lightbox Sport, was axed earlier this year.

Piracy: Still a popular option, with scoff-laws egged on by the fact there have been no video file-sharing prosecutions brought in New Zealand.

Netflix: Easily the biggest streaming service on the planet with 88 million subscribers and enjoys a big lead in the local market over second-placed Lightbox and distant-third Neon. Over the past year it has dramatically pruned back its catalogue of content in favour of an emphasis on Netflix-original series — on which it will spend a staggering $US6 billion next year, easily more than NBC, the biggest-spending traditional TV network. This year it has become increasingly aggressive and effective at blocking outsiders from its US-based service, which still offers more content than versions of the service offered elsewhere. From $11.49 to $18.49 a month depending on the number of screens and options like HD and ultra HD (4K). 

Neon: Owned by Sky TV. Heavy on content from HBO such as Game of Thrones and Westworld. Finally added HD recently. Apple TV app on the way. $20 a month.

Sky On Demand: Sky's new feature, which has added on-demand content that its subscribers can access through their decoder via a wifi dongle.

YouTube Red: Owned by Google. Soft-launched earlier this year in the US, Australia and New Zealand. Lets subscribers watch ad-free YouTube clips and stream TV shows and movies for $13 a month. One to keep an eye on. Just today, Facebook's Mark Zuckerberg made noises about his social network launching a similar service. So make that two sleeping giants.