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Despite challenges, Netflix says its ad tier is doing well

In November, Netflix unveiled its long-anticipated ad-supported tier which offers customers in select markets, including the U.S., the ability to offset the cost of a Netflix subscription by allowing their viewing to be interrupted with ad breaks. At the Consumer Electronics Show in Las Vegas, Netflix President of Worldwide Advertising, Jeremi Gorman, offered some initial insight into how the product has been performing as well as the streamer’s future plans.
During an interview at Variety’s Entertainment Summit at CES, the exec said the company has been happy with the debut selection of advertisers and their diversity.
“It’s really across the board,” said Gorman, of the variety of brands participating. “We’re seeing CPG companies, luxury companies, automotive companies…[and] retail. We’re seeing a broad swath.” This is also good for the consumer experience, she noted, as it means viewers won’t be bored by one car ad after another. “There’s a wide variety of advertising types, and I think we’ll continue to see that,” Gorman predicted.
The interview also touched on some of the early complaints and concerns about Netflix’s foray into ads.
Among them is the key pushback the company has been receiving over its high ad prices, asking for what one industry exec dubbed “Super Bowl CPMs.” Gorman, however, justified the pricing but admitted the market will ultimately dictate what sort of pricing Netflix will be able to get.
“From a supply-demand perspective, the premium CPMs are reflective of two things: one is that we just couldn’t take that many advertisers. We certainly didn’t want to disappoint anybody. Then secondarily, the premium content environment in which the ads run I think warrants a high CPM.”
Whether Netflix constitutes a “premium environment” is up for debate, of course. But Netflix seems to be adjusting its expectations.
“I think we’re certainly humble enough to very much understand we’re top of market, and in addition to that, the market will more or less dictate to us what are reasonable CPMs,” Gorman said.
Another concern about Netflix’s ad-supported service has to do with which content can include ads. As the streamer wasn’t set up as an ad-supported service to begin with, many of its content deals didn’t include AVOD rights (advertising video on demand). That means Netflix has limited ad inventory, and couldn’t even run ads against some of its own “Netflix Originals” if the deals didn’t include the proper rights.
Gorman addressed this as well, saying Netflix was actively working on the licensing issues.
“That’s progressing, as we speak, day by day. We’re renegotiating deals we made a long time ago,” she said, adding that the “vast majority” of content that people watch regularly is available in the ad tier surface. In the meantime, Netflix has about 85% to 95% of its content available on the ad tier, Gorman said.
Then there’s the real concern that, from a business perspective, offering a lower-cost tier has the potential to cannibalize Netflix’s existing subscriptions as customers drop to cheaper tiers at a quicker rate that’s not offset by growth in the ads tier. Gorman, though, downplayed those concerns saying Netflix customers historically have remained on the plan they’re currently on.
The exec, unfortunately, couldn’t speak to the uptake of the ads-supported product, as Netflix is poised to announce earnings, but said “we’re pleased with the growth we’re seeing.”
At present, Netflix’s ad tier is available in the U.S., the U.K., France, Germany, Spain, Italy, Australia, Japan, Korea, Brazil, Canada, and Mexico. The company has no immediate plans to expand, but longer-term would aim to target any larger ad market. In addition to ads, subscribers on the Basic with Ads plan have to deal with lower video quality (720p HD) and are limited to streaming from one device. They also can’t download content to their devices for offline viewing.
Going forward, Netflix aims to do a bit more than just running typical ads, including things like dynamic insertion of ads near moments that are relevant to marketers, single-show sponsorships, and more. It will also later allow marketers to target ads by age and gender.
Despite challenges, Netflix says its ad tier is doing well by Sarah Perez originally published on TechCrunch
Despite challenges, Netflix says its ad tier is doing well

Camera maker Canon leans into software at CES

Depending on whether you spend most of your time in hospitals, offices or in the great outdoors, when you hear “Canon,” your mind will likely go to medical scanning equipment, high-end printers or cameras. At CES this year, the 85-year-old company is leaning in a new direction, with an interesting focus on software applications.
At the show, the imaging giant showed off a direction it has been hinting at before, but this time relying far less on its own hardware, and more on the software the company has developed, in part as a response to the COVID-19 pandemic casting a shadow over people’s ability to connect. To the chorus of “meaningful communication” and “powerful collaboration,” the Japanese imaging giant appears to be plotting out a new course for what’s next.

I guess you can (officially) use your fancy Canon camera as a webcam studio now

“Canon is creating ground-breaking solutions that help people connect in more ways than we ever could have imagined, redefining how they work and live at a time when many of them are embracing a hybrid lifestyle,» said Kazuto Ogawa, president and CEO, Canon U.S.A., Inc, in a press briefing at CES 2023. “Canon’s ultimate role is to bring people closer together by revealing endless opportunities for creators. Under our theme of ‘Limitless Is More,’ we will show CES 2023 attendees what we are creating as a company focused on innovation and a world without limits.”
Among other things, Canon showed off a somewhat gimmicky immersive experience tied in with M. Night Shyamalan’s upcoming thriller movie, “Knock at the Cabin.” The very Shyamalanesque movie trailer will give you a taster of the vibe. At the heart of things, however, Canon is tapping into a base desire in humanity; to feel connected to one another. The company is desperate to show off how its solutions can “remove the limits humanity faces to create more meaningful communication,” through four technologies it is showing off at the trade show this year.
Canon U.S.A. CEO Kevin Ogawa on stage at CES 2023 along with M. Night Shyamalan. Image Credits: Haje Kamps/TechCrunch
3D calling: Kokomo
The flagship solution Canon is showing off is Kokomo, which the company describes as a first-of-its-kind immersive VR software package. It is designed to combine VR with an immersive calling experience. The solution is pretty elegant: Using a VR headset and a smartphone, the Kokomo software enables users to see and hear one another in real time with their live appearance and expression in a photo-real environment.
The Kokomo solution brings 3D video calling to a home near you. Image Credits: Canon
In effect, the software package scans your face to learn what you look like, then turns you into a photo-realistic avatar. The person you are in a call with can see you — sans VR headset — showing your physical appearance and facial expressions. The effect is to experience a 3D video call. At the show, Canon is demoing the tech by letting visitors step into a 1×1 conversation with the “Knock at the Cabin” characters.
We spoke with the team behind Kokomo to figure out how the project came about, why Canon is dipping its toe in standalone software, what the future of this technology is, and how it is going to make money.

With Kokomo VR meeting software, Canon takes a step away from its hardware roots

Realtime 3D video: Free Viewpoint
Aimed at the sports market, Free Viewpoint is a solution that combines more than 100 high-end cameras with a cloud-based solution that makes it possible to move a virtual camera to any location. The software takes all the video feeds, creating a point-cloud-based 3D model that enables a virtual camera operator to create a number of angles that would otherwise have been impossible: Drone-like replay footage, swooping into the action, for example, or detailed in-the-thick-of-things-type footage, enabling viewers to see plays from the virtual perspective of one of the players.
In the U.S., the system has already been installed at two NBA arenas (including at the home of the Cavaliers and the Nets). The video can be broadcast live or compiled into replay clips. Canon also points out that the system enables “virtual advertising and other opportunities for monetization,” so I suppose we have that to look forward to as well.

Canon takes tentative step towards eliminating photographers with robotic PICK camera

Returning to the “Knock at the Cabin” theme, at CES, Canon showed off a virtual action scene captured with the Free Viewpoint video system, captured at Canon’s Volumetric Video Studio in Kawasaki, Japan. The effect of watching an action scene “through the eyes” of various characters was a wonderfully immersive experience.
Augmented reality tech: MREAL
Canon also showed off some earlier-stage tech that isn’t quite ready for prime-time viewing yet, including MREAL. This is tech that helps integrated simulation-like immersive worlds, merging the real and the virtual worlds. Use cases might include pre-visualization for movies, training scenarios and interactive mixed-reality entertainment. The company tells TechCrunch that the technology is in the market research phase.
The company is trying to figure out what to develop further and how to market the product. In other words: Who would use this, what would they use it for and what would they be willing to pay for it.

Augmented reality’s half-decade of stagnation

Remote presence: AMLOS
Activate My Line of Sight (AMLOS) is what Canon is calling its solution for hybrid meeting environments, where some participants are in person, while others are off-site. If you’ve ever been in a meeting in that configuration, you’ll often find that attending remotely is a deeply frustrating experience, as the in-person meeting participants are engaging with each other while the remote attendees are off on a screen somewhere.
Canon hopes that AMLOS can help solve that; it’s a software-and-camera set of products aiming to improve the level of engagement. It adds panning, tilting and zooming capabilities to remote camera systems, giving remote users the ability to customize their viewing and participation experience. So far, the solution is not quite intuitive enough to overcome the barrier of not being in the room, but it’s certainly better than being a disembodied wall of heads on a screen.

Camera maker Canon leans into software at CES by Haje Jan Kamps originally published on TechCrunch
Camera maker Canon leans into software at CES

What to expect from the creator economy in 2023

Social media platforms and creator-focused startups haven’t looked too hot this year, as companies like Snapchat, Patreon, Cameo and Meta all waged layoffs along with the rest of the tech industry. YouTube ad revenue is declining, and creator funds for platforms like Pinterest have dried up.
It might seem like things are bad on the surface, but the creator economy is more than just a buzzword that’s losing interest among venture capitalists. Despite challenges on a platform level, creators are continuing to make a living outside of the bounds of traditional media and will only continue to grow in 2023.
Social media platforms will need to commit to creators (seriously, this time)
In my opinion, the biggest creator news in 2022 was YouTube’s announcement that it would include Shorts creators in the YouTube Partner Program, allowing shortform creators to earn ad revenue for the first time ever. Starting in early 2023, creators will be able to apply to the YouTube Partner Program if they meet a new Shorts-specific threshold of 1,000 subscribers and 10 million Shorts views over 90 days. As members of the Partner Program, these creators will earn 45% of ad revenue from their videos.
This is huge, because it’s an open secret that shortform video is hard to monetize. For example, TikTok pays creators through its Creator Fund, a pool of $200 million unveiled in summer 2020. At the time, TikTok said it planned to expand that pool to $1 billion in the U.S. over the next three years, and double that internationally. That might sound like a lot of money, but by comparison, YouTube paid creators over $30 billion in ad revenue over the last three years. As the pool of eligible creators becomes more saturated, creator funds are pretty useless — if you’re in TikTok’s creator program and have a video get 1 million views, you might be able to cash out for a small latte. So while these multi-million (or billion) dollar creator funds might seem like a beacon for creators, they don’t help too much. Most popular TikTokers make their money from sponsorships and off-platform opportunities, rather than from their videos.
TikTok has long been the dominant platform in short form video, while Snapchat, Instagram and YouTube largely copied the newcomer to keep up. But creators will finally be incentivized to flock to YouTube Shorts once they can actually earn ad money there. The best part? There has never been more pressure on TikTok to follow suit.

YouTube Shorts could steal TikTok’s thunder with a better deal for creators

‘Creator Economy’ isn’t a buzzword
What’s a buzzword? You know it when you see it. It’s when Facebook rebrands to Meta and you suddenly get hundreds of emails about “the metaverse,” or when a crypto startup declares its commitment to fostering “community” just because it has a semi-active Discord server. You could also classify “creator economy” as a buzzword — I personally find myself cringe whenever I say it out loud, but I stand by the fact that it’s a much easier shorthand than saying “the industry in which talented people on the internet are leveraging social media audiences to develop careers as independent creatives.”
But all of these buzzwords actually represent real things. Yes, even the metaverse is a thing, though I’d argue we’re talking more about Club Penguin than whatever Mark Zuckerberg is into. The problem with buzzwords, though, is that they dilute real phenomena into fads that get further muddled by disconnected venture capitalists doubling down on the trend with over-enthusiastic investments.
On TechCrunch’s own Equity podcast last week, everyone’s favorite tweeter and brand new dad (!!) Alex Wilhelm reflected on a prediction he made last year.
“The passion economy isn’t sustainable,” he read, quoting his prediction from last year. “Nailed it! Who talks about creators these day? Nobody!”
I can forgive Alex because I do hate “passion economy” with the fire of an exploding supernova for each and every follower Khaby Lame has on TikTok. The term glorifies the relentless, soul-crushing hustle that people face while trying to “make it” in a field they love, while ignoring that industries that people pursue out of passion (art, non-profit work, politics) are often the most exploitative of all.
I think what Alex is getting at here, though, is that in 2021, venture capitalists poured money into the creator economy in the same way they pursued “trendy” tech like AI and web3. According to data retrieved from Crunchbase earlier this year, here’s the breakdown of creator economy funding for the first three quarters of 2022.
Q1: 58 rounds worth $343.2 million.
Q2: 42 rounds worth $336.0 million.
Q3: 19 rounds worth $110.2 million.
I don’t think this means that the creator economy is failing, though. It could just mean that the industry is correcting for over-investing in a bunch of creator-focused companies that creators didn’t actually want or need. Also, you know, the economy.
I’ve been saying for the entire past year that creator economy startups can only succeed if their foremost goal is truly to help creators. In 2021, a year when venture capital flowed like champagne at a Gatsby party, we joked that there were more creator economy startups than creators. But that’s a problem for investors, not creators, many of whom operate completely oblivious to the whims of a16z. It’s indicative of an environment that incentivizes tech moguls with no hands-on experience to try to solve problems of an industry that they don’t quite understand, and as a result, the space became deeply oversaturated. I cannot keep track of the number of companies I’ve encountered that attempt to automate the process of securing brand deals or help creators make white label products.
I’d go as far as to say that it’s bad for creators when there are too many startups angling for their partnership. We know that most startups are doomed to fail — what happens if you rely on a company to offer your business some sort of service, and then they fail within a few years? This is why I’ve made it a personal policy of mine to always ask creator-focused startup founders how they would plan to protect their creators from harm if their company fails.
No matter where the VC funds may fall in 2023, the playbook for creators’ success remains the same. Diversify your income streams, build trust with your audience, and make sure you don’t burn yourself out.

Yeah, funding for creator-focused startups is drying up

Venture capital will continue to intersect with creators, but not in the way you think
Investments into creator economy companies might be down, but creators are continuing to interface with VC money in a way that their audiences don’t often see. Charli D’Amelio and her family have become investors themselves. MrBeast is seeking funding at a unicorn-sized valuation, which isn’t surprising given that other especially successful creators have accomplished the same.
In less extreme cases, many creators are growing their businesses through startups like Creative Juice, Spotter and Jellysmack, which offer up-front cash in exchange for temporary ownership over a creator’s YouTube back catalog, which means the company gets all of the ad revenue from those videos. These companies operate similarly to venture capital firms. They invest in creators that they believe will turn that cash infusion into even more money, giving both parties a return.
Despite securing massive funding rounds and mammoth valuations, the model that these companies operate is still relatively new, and creators should exercise caution, as they should with any business deal.

Is MrBeast actually worth $1.5 billion?

What to expect from the creator economy in 2023 by Amanda Silberling originally published on TechCrunch
What to expect from the creator economy in 2023

QuickVid uses AI to generate short-form videos, complete with voiceovers

Generative AI is coming for videos. A new website, QuickVid, combines several generative AI systems into a single tool for automatically creating short-form YouTube, Instagram, TikTok and Snapchat videos.
Given as little as a single word, QuickVid chooses a background video from a library, writes a script and keywords, overlays images generated by DALL-E 2 and adds a synthetic voiceover and background music from YouTube’s royalty-free music library. QuickVid’s creator, Daniel Habib, says that he’s building the service to help creators meet the “ever-growing” demand from their fans.
“By providing creators with tools to quickly and easily produce quality content, QuickVid helps creators increase their content output, reducing the risk of burnout,” Habib told TechCrunch in an email interview. “Our goal is to empower your favorite creator to keep up with the demands of their audience by leveraging advancements in AI.”
But depending on how they’re used, tools like QuickVid threaten to flood already-crowded channels with spammy and duplicative content. They also face potential backlash from creators who opt not to use the tools, whether because of cost ($10 per month) or on principle, yet might have to compete with a raft of new AI-generated videos.
Going after video
QuickVid, which Habib, a self-taught developer who previously worked at Meta on Facebook Live and video infrastructure, built in a matter of weeks, launched on December 27. It’s relatively bare bones at present — Habib says that more personalization options will arrive in January — but QuickVid can cobble together the components that make up a typical informational YouTube Short or TikTok video, including captions and even avatars.
It’s easy to use. First, a user enters a prompt describing the subject matter of the video they want to create. QuickVid uses the prompt to generate a script, leveraging the generative text powers of GPT-3. From keywords either extracted from the script automatically or entered manually, QuickVid selects a background video from the royalty-free stock media library Pexels and generates overlay images using DALL-E 2. It then outputs a voiceover via Google Cloud’s text-to-speech API — Habib says that users will soon be able to clone their voice — before combining all these elements into a video.
Image Credits: QuickVid
See this video made with the prompt “Cats”:

https://techcrunch.com/wp-content/uploads/2022/12/img_5pg7k95x9ig2tofh7mkrr_cfr.mp4
Or this one:
https://techcrunch.com/wp-content/uploads/2022/12/img_61ighv4x55slq9582dbx_cfr.mp4
QuickVid certainly isn’t pushing the boundaries of what’s possible with generative AI. Both Meta and Google have showcased AI systems that can generate completely original clips given a text prompt. But QuickVid amalgamates existing AI to exploit the repetitive, templated format of B-roll-heavy short-form videos, getting around the problem of having to generate the footage itself.
“Successful creators have an extremely high-quality bar and aren’t interested in putting out content that they don’t feel is in their own voice,” Habib said. “This is the use case we’re focused on.”
That supposedly being the case, in terms of quality, QuickVid’s videos are generally a mixed bag. The background videos tend to be a bit random or only tangentially related to the topic, which isn’t surprising given QuickVids being currently limited to the Pexels catalog. The DALL-E 2-generated images, meanwhile, exhibit the limitations of today’s text-to-image tech, like garbled text and off proportions.
In response to my feedback, Habib said that QuickVid is “being tested and tinkered with daily.”
Copyright issues
According to Habib, QuickVid users retain the right to use the content they create commercially and have permission to monetize it on platforms like YouTube. But the copyright status around AI-generated content is … nebulous, at least presently. The U.S. Patent and Trademark Office (USPTO) recently moved to revoke copyright protection for an AI-generated comic, for example, saying copyrightable works require human authorship.
When asked about how the USPTO decision might affect QuickVid, Habib said he believes that it only pertain to the “patentability” of AI-generated products and not the rights of creators to use and monetize their content. Creators, he pointed out, aren’t often submitting patents for videos and usually lean into the creator economy, letting other creators repurpose their clips to increase their own reach.
“Creators care about putting out high-quality content in their voice that will help grow their channel,” Habib said.
Another legal challenge on the horizon might affect QuickVid’s DALL-E 2 integration — and, by extension, the site’s ability to generate image overlays. Microsoft, GitHub and OpenAI are being sued in a class action lawsuit that accuses them of violating copyright law by allowing Copilot, a code-generating system, to regurgitate sections of licensed code without providing credit. (Copilot was co-developed by OpenAI and GitHub, which Microsoft owns.) The case has implications for generative art AI like DALL-E 2, which similarly has been found to copy and paste from the datasets on which they were trained (i.e., images).
Habib isn’t concerned, arguing that the generative AI genie’s out of the bottle. “If another lawsuit showed up and OpenAI disappeared tomorrow, there are several alternatives that could power QuickVid,” he said, referring to the open source DALL-E 2-like system Stable Diffusion. QuickVid is already testing Stable Diffusion for generating avatar pics.
Moderation and spam
Aside from the legal dilemmas, QuickVid might soon have a moderation problem on its hands. While OpenAI has implemented filters and techniques to prevent them, generative AI has well-known toxicity and factual accuracy problems. GPT-3 spouts misinformation, particularly about recent events, which are beyond the boundaries of its knowledge base. And ChatGPT, a fine-tuned offspring of GPT-3, has been shown to use sexist and racist language.
That’s worrisome, particularly for people who’d use QuickVid to create informational videos. In a quick test, I had my partner — who’s far more creative than me, particularly in this area —  enter a few offensive prompts to see what QuickVid would generate. To QuickVid’s credit, obviously problematic prompts like “Jewish new world order” and “9/11 conspiracy theory” didn’t yield toxic scripts. But for “Critical race theory indoctrinating students,” QuickVid generated a video implying that critical race theory could be used to brainwash schoolchildren.
See:

https://techcrunch.com/wp-content/uploads/2022/12/img_e4wba39us0vqtc8051491_cfr.mp4
Habib says that he’s relying on OpenAI’s filters to do most of the moderation work and asserts that it’s incumbent on users to manually review every video created by QuickVid to ensure “everything is within the boundaries of the law.”
“As a general rule, I believe people should be able to express themselves and create whatever content they want,” Habib said.
That apparently includes spammy content. Habib makes the case that the video platforms’ algorithms, not QuickVid, are best positioned to determine the quality of a video, and that people who produce low-quality content “are only damaging their own reputations.” The reputational damage will naturally disincentivize people from creating mass spam campaigns with QuickVid, he says.
“If people don’t want to watch your video, then you won’t receive distribution on platforms like YouTube,” he added. “Producing low-quality content will also make people look at your channel in a negative light.”
But it’s instructive to look at ad agencies like Fractl, which in 2019 used an AI system called Grover to generate an entire site of marketing materials — reputation be damned. In an interview with The Verge, Fractl partner Kristin Tynski said that she foresaw generative AI enabling “a massive tsunami of computer-generated content across every niche imaginable.”
In any case, video-sharing platforms like TikTok and YouTube haven’t had to contend with moderating AI-generated content on a massive scale. Deepfakes — synthetic videos that replace an existing person with someone else’s likeness — began to populate platforms like YouTube several years ago, driven by tools that made deepfaked footage easier to produce. But unlike even the most convincing deepfakes today, the types of videos QuickVid creates aren’t obviously AI-generated in any way.
Google Search’s policy on AI-generated text might be a preview of what’s to come in the video domain. Google doesn’t treat synthetic text differently from human-written text where it concerns search rankings but takes actions on content that’s “intended to manipulate search rankings and not help users.” That includes content stitched together or combined from different web pages that “[doesn’t] add sufficient value” as well as content generated through purely automated processes, both of which might apply to QuickVid.
In other words, AI-generated videos might not be banned from platforms outright should they take off in a major way but rather simply become the cost of doing business. That isn’t likely to allay the fears of experts who believe that platforms like TikTok are becoming a new home for misleading videos, but — as Habib said during the interview — “there is no stopping the generative AI revolution.”
QuickVid uses AI to generate short-form videos, complete with voiceovers by Kyle Wiggers originally published on TechCrunch
QuickVid uses AI to generate short-form videos, complete with voiceovers

Amazon is working on a standalone app for sports content, new report claims

Amazon is developing a standalone app for watching sports, according to a new report from The Information. The move signals Amazon’s continued push toward investing in Prime Video and live sports content. If released, the standalone app would better highlight Amazon’s sports content, which is currently included in the company’s main Prime Video platform.
The report comes as Amazon CEO Andy Jassy recently called live sports “a unique asset” that Amazon will continue to invest in. Amazon’s current live sports offerings include exclusive rights to the NFL’s Thursday Night Football, along with some Premier League soccer matches and Yankees baseball games. Amazon has also invested in other sports content to complement the live games, as the company launched original sports talk shows on both Prime Video and its ad-supported streaming service Freevee.
It’s unknown when Amazon plans to launch the standalone sports app. It’s also possible that the company may decide to shelve the plans altogether.
Amazon did not respond to TechCrunch’s request for comment.
Amazon’s plans for a standalone sports app suggest that the company is exploring new ways to tap its live sports investments into additional revenue streams. Considering the steep costs of streaming rights, it wouldn’t be surprising if the company plans to charge a separate subscription fee for sports content with this standalone app. It’s also possible that Amazon may decide to offer a separate subscription tier that includes its sports content.
The new report comes as Amazon has been reviewing parts of its unprofitable divisions, which led to the elimination of numerous roles. Even amid these cost-cutting efforts, Amazon appears to be committed to building out Prime Video and its live sports streaming content.
Amazon isn’t the only major company looking to continue investing in live sports content, as the company faces increasing competition from other tech giants who have also inked sports streaming deals. Last week, Google’s YouTube secured the NFL Sunday Ticket in a landmark streaming deal. On the other hand, Apple has gained the rights to Major League Baseball and Major League Soccer games.

YouTube secures NFL Sunday Ticket in landmark streaming deal

Amazon is working on a standalone app for sports content, new report claims by Aisha Malik originally published on TechCrunch
Amazon is working on a standalone app for sports content, new report claims