MARINA DEL REY, Calif. —The eighth annual Parks Associates “Future of Video” event this week featured a roster of executive decision makers from across the video business, mostly describing a maturing streaming industry grappling with questionable consumer confidence, lagging progress on search and recommendation, and ongoing concerns about churn.
But there were plenty of green shoots to ponder, as well, starting with a niche subscription streaming service CuriosityStream, which captured the imagination of the speakers and attendees alike, not to mention one of the three-day business conference’s biggest voices, Wall Street analyst Laura Martin from Needham Co.
Just days earlier, CuriosityStream —hereto now simply just a robust SVOD library of nature and science shows founded by cable TV pioneer John Hendricks 10 years ago — reported a 41% spike in third-quarter income, to $18.4 million.
Somewhat quietly, CuriosityStream may have kickstarted a revolution in the video business, licensing its fully owned IP to operators of large language models (LLMs) for the purposes of artificial intelligence training. Nearly half of the company’s Q3 revenue was generated by licensing content for AI learning — the company has boosted its revenue with a new revenue stream that didn’t even exist two years ago.
One of the biggest bulls for this strategy is Needham analyst Martin, who told a Future of Video audience that soon, every content company is either going to have to create an additional revenue stream like this or they’ll be “put out of business by their competitors.”
She noted that CuriosityStream isn’t just brokering the 300,000 of hours of content it owns, but also an additional 1.7 million hours held by third-party content owners, who have “stepped into” CuriosityStream’s existing LLM deals and share 50% of their AI revenue with the company.
“If you own 100% of the IP — and it’s a full 100%, because that’s what it takes — and it’s high-quality content and not user-generated, you call up CuriosityStream and step into their deal,” Martin said. “You start generating revenue the day you download your IP to them.”
CuriosityStream’s innovative new revenue stream promises to grow even more lucrative, Martin added, as the company adds LLMs — it currently works with nine, including Google Gemini, but is in talks to partner with more than a half a dozen others. Martin also expects more revenue share through additional content company partnerships.
Searching for better search
Separately, Martin’s Wall Street focus was juxtaposed by a theme of frustration and bewilderment from speakers from content and tech companies, several of which cited data published by Gracenote last week showing that it’s taking more time on average these day, not less, for consumers to find something to stream on their smart TVs.
With all of the ongoing advances in AI, not to mention a ubiquitous discussion among streaming and Big Tech companies about improving search and recommendation occurring for the last decade, why hasn’t it improved?
Also in the backdrop: Survey data published by Hub Entertainment Research at the beginning of the week suggesting that consumers, frustrated by poor search and recommendation on major SVOD and FAST platforms, are turning to the more easily navigated smorgasbord of YouTube to find something to watch.
Summed up panelist Jon Cohen, chief revenue officer for vendor Frequency: “Search and recommendation just has to get better.”
A day later, Jason Cohen, unrelated founder and CEO of SaaS provider MyBundle, suggested that improving search and recommendation might not be a matter of software, but rather one of rethinking devices. While the smart TV is the best gadget for watching content he said, the smart phone is far more elegant at performing tasks like finding content.
One company that may be making strides with search: Charter Communications. Presenting his cable company’s lauded strategy of bundling base packages of popular SVODs with its most popular pay TV tier, Scott Barton, group VP for Charter, showed off a nifty new consumer convenience feature.
This season, New York Knicks games are spread out across national platforms including ABC/ESPN, NBC/Peacock and Amazon Prime Video, as well as regional sports network MSG.
Consumers unversed in the complexities of the NBA’s new $76 billion national TV deal might be unsure as to where to find the team’s games.
Since Charter has content licensing relationships with all of these aforementioned platforms, however, it was able to create an effective search tool that lets users find the right app for the day’s game by simply saying into their Xumo voice remote, “Find my Knicks.” The Spectrum TV app immediately takes them to the right streamer.
Charter is currently advertising this feature with a clever TV commercial starring comedian Tracy Morgan and Knicks playing legend John Starks.
Consumer confidence remains … iffy
Dallas-based research company Parks Associates kicked off its three-day B2B conference by keynoting its 76-page “State of Streaming” report — a deep dive into the economic trends facing the industry.
Polling more than 8,000 U.S. adults on their spending expectations, Parks found consumers anticipating price increases on staples like groceries and household supplies. But the populace was evenly split on whether they’ll be spending more or less on things like streaming video or gaming.
Parks’ data did show that, after a period of streaming spending recession, the average number of subscription services used per household, and the amount being spent on them, was back up in Q3.
Article updated to fix the intro sentence which was incomplete in an earlier version of the story..