WEBVTT - Rerun: Streaming Services that Sunk 0:00:04.440 --> 0:00:12.520 Welcome to tech Stuff, a production from iHeartRadio. Hey there, 0:00:12.560 --> 0:00:15.880 and welcome to tech Stuff. I'm your host, Jonathan Strickland. 0:00:15.920 --> 0:00:18.880 I'm an executive producer with iHeart Podcasts and how the 0:00:18.960 --> 0:00:23.439 tech are you. I am wrapping up my vacation as 0:00:23.480 --> 0:00:27.840 you listen to this. I am sadly bidding a fond 0:00:27.920 --> 0:00:33.360 farewell to the Caribbean, unless, of course, hurricanes ruined my trip, 0:00:33.360 --> 0:00:36.720 which is entirely possible. I'm watching every day as storm 0:00:36.800 --> 0:00:40.720 systems form out there, so we'll see. But anyway, I 0:00:40.760 --> 0:00:44.080 am incapable of recording a new episode today. So this 0:00:44.200 --> 0:00:48.480 episode originally published on May twenty second, twenty twenty three. 0:00:48.840 --> 0:00:54.800 It is titled Streaming Services that sunk Golly, I'm on 0:00:54.880 --> 0:00:58.280 a boat and I've decided to run an episode with 0:00:58.400 --> 0:01:02.240 the words sunk in it. Y'all, just don't be me. 0:01:02.840 --> 0:01:09.120 Hope you enjoy. So. Back in two thousand and seven, 0:01:09.280 --> 0:01:13.039 a rent by mail video business made a move that 0:01:13.080 --> 0:01:18.399 would be a true disruption. We talk about disruptive companies, 0:01:19.360 --> 0:01:22.520 this was definitely one of them. It had already shaken 0:01:22.560 --> 0:01:25.080 things up by taking aim at a huge company that 0:01:25.120 --> 0:01:28.680 had dominated the home video rental market for decades through 0:01:28.760 --> 0:01:33.000 offering customers the chance to access a huge media library 0:01:33.319 --> 0:01:36.400 from the comfort of their own homes, albeit they had 0:01:36.400 --> 0:01:38.600 to wait for titles to make their way through the 0:01:38.600 --> 0:01:42.560 postal system before they could enjoy them. But now, this 0:01:42.720 --> 0:01:45.039 upstart company in two thousand and seven had set up 0:01:45.040 --> 0:01:47.680 a service where, if you can believe it, you could 0:01:47.720 --> 0:01:52.000 actually connect to a media player through the Internet and 0:01:52.080 --> 0:01:56.080 watch movies and television shows by streaming them to your device. 0:01:57.000 --> 0:02:01.320 The upstart company was, of course, Netflix had battled with Blockbuster, 0:02:01.760 --> 0:02:05.600 which actually had the opportunity to buy Netflix at one point, 0:02:05.920 --> 0:02:09.239 but walked away from that deal, and Netflix quickly became 0:02:09.639 --> 0:02:13.400 a big concern for the major studios, which understandably and 0:02:13.720 --> 0:02:18.919 arguably correctly worried that unless someone took action, Netflix would 0:02:18.919 --> 0:02:23.799 become a powerful monopoly for prestige media streaming services. I'm 0:02:23.840 --> 0:02:26.200 not talking about the user generated stuff which you would 0:02:26.200 --> 0:02:31.520 find on platforms like YouTube, but rather studio produced stuff. Now, 0:02:31.520 --> 0:02:34.360 at that point, Netflix would have a lot more leverage 0:02:34.360 --> 0:02:36.840 when negotiating with studios if it was the one and 0:02:36.919 --> 0:02:41.079 only place where customers could go to watch stuff online, 0:02:41.320 --> 0:02:45.320 and studios hate when leverage is given to anyone else. 0:02:45.320 --> 0:02:49.160 See also the Writer's Guild of America Strike. Lots of 0:02:49.200 --> 0:02:53.360 other streaming services would upear over the next decade and 0:02:53.360 --> 0:02:56.040 a half. Some of them were the product of collaboration. 0:02:56.320 --> 0:03:00.320 Hulu initially was I'll talk a little bit about who 0:03:00.520 --> 0:03:04.639 later on in the episode. Some streaming services launched as 0:03:04.639 --> 0:03:08.880 an extension of a television or cable channel, so eventually 0:03:08.880 --> 0:03:12.320 you would get things like Peacock or HBO Max or 0:03:12.360 --> 0:03:16.320 Disney Plus or Paramount Plus, which draws heavily from CBS, 0:03:16.880 --> 0:03:21.040 and lots more, including ones that aren't extension of media companies, 0:03:21.440 --> 0:03:25.120 like things like Amazon Prime Video and Apple TV Plus. 0:03:25.840 --> 0:03:29.120 There are so many streaming services now that if you 0:03:29.240 --> 0:03:32.720 subscribed to all of them, you would be probably paying 0:03:32.760 --> 0:03:34.480 more per month than you would if you went with 0:03:34.520 --> 0:03:38.920 one of those gargantuan cable TV packages. The landscape is 0:03:39.000 --> 0:03:43.400 crowded and it's complicated. I mean, sure, if all you 0:03:43.520 --> 0:03:47.160 consume are Disney films, and let's be honest, the way 0:03:47.200 --> 0:03:49.480 we're going, pretty soon every movie is going to be 0:03:49.520 --> 0:03:52.840 a Disney movie because the Mousehouse just gobbles up everything. Well, 0:03:53.280 --> 0:03:56.000 if that's all you do, then Disney Plus might be 0:03:56.120 --> 0:03:58.680 all you need. But most of us are likely to 0:03:58.720 --> 0:04:02.320 find ourselves subscribing to, or at least wanting to subscribe 0:04:02.360 --> 0:04:05.920 to a few different services to get access to all 0:04:05.960 --> 0:04:09.400 the stuff we like, and even then we're probably giving 0:04:09.480 --> 0:04:12.119 up on a couple of things. For example, I think 0:04:12.160 --> 0:04:16.640 at this point, I have Netflix, I have Amazon Prime, 0:04:16.960 --> 0:04:20.479 I have Apple TV Plus, I have Disney Plus, I 0:04:20.520 --> 0:04:25.400 have HBO Max. That might be at oh, I've got Peacock. 0:04:26.640 --> 0:04:28.920 So like, that's ridiculous, right, I Mean there are ties 0:04:28.920 --> 0:04:30.760 where I sit there and think, do I really need 0:04:30.800 --> 0:04:33.640 all these answers? No, I don't need them all, but 0:04:34.400 --> 0:04:37.280 there are programs that I can only watch through one 0:04:37.400 --> 0:04:41.039 of those services, and there's not really other alternative. So 0:04:41.080 --> 0:04:43.359 there I go. Now, the last couple of years have 0:04:43.400 --> 0:04:46.359 shown us that on the business side, if we go 0:04:46.400 --> 0:04:48.480 to the other side, yeah, things kind of stink if 0:04:48.480 --> 0:04:51.680 you're a consumer because they're all these different competing services. 0:04:52.040 --> 0:04:54.560 But on the other side, things aren't that rosy either. 0:04:55.040 --> 0:04:58.560 While the consumer struggles with which services they're gonna subscribe 0:04:58.600 --> 0:05:02.760 to or pass up, the media companies behind the services 0:05:02.800 --> 0:05:05.679 are trying to carve out a profitable path while also 0:05:05.760 --> 0:05:10.039 competing with one another. Now, maybe that involves producing new 0:05:10.160 --> 0:05:13.440 films and shows that are exclusively for the streaming service. 0:05:13.800 --> 0:05:17.440 Maybe it involves securing licensing for old favorites before a 0:05:17.600 --> 0:05:19.640 rival can do it, though a lot of that stuff 0:05:19.720 --> 0:05:23.839 ends up getting sewn up in existing libraries. Maybe it 0:05:23.960 --> 0:05:27.000 means taking some stuff off the service so that you 0:05:27.000 --> 0:05:30.320 know you're not paying people who made it over and 0:05:30.320 --> 0:05:34.960 over the residuals. Cough. David Zaslov does this a lot, cough. 0:05:35.640 --> 0:05:41.800 The point is, the streaming service business is really, really tough. 0:05:41.880 --> 0:05:44.599 I mean it's great when you're on a meteoric rise. 0:05:44.680 --> 0:05:47.920 You know, you launch, people find you, they talk you up. 0:05:48.279 --> 0:05:53.520 Your subscription rates soar. You're just doing gangbusters. It's growth 0:05:53.520 --> 0:05:57.160 all the way, baby. But eventually you start to hit 0:05:57.200 --> 0:06:00.440 a plateau and fewer people are signing up this quarter 0:06:00.520 --> 0:06:03.760 compared to last quarter, or worse, you might hit a 0:06:03.800 --> 0:06:06.680 point where you actually see subscriber numbers go down, and 0:06:06.720 --> 0:06:11.720 that's super bad. Now, maybe you supplement your revenue by 0:06:11.800 --> 0:06:15.839 showing ads against content. Maybe it's not just subscriptions. Maybe 0:06:15.920 --> 0:06:21.200 advertisers offer some stuff for you as well. Maybe you 0:06:21.240 --> 0:06:24.080 give customers options. Maybe they can subscribe it a higher 0:06:24.120 --> 0:06:27.560 tier and they can get an ad free experience. That's 0:06:27.560 --> 0:06:30.120 pretty common these days and then if they subscribe it 0:06:30.400 --> 0:06:33.400 a lower tier, they're spending less per month, but they're 0:06:33.400 --> 0:06:36.679 also having to sit through ads to watch the content 0:06:36.760 --> 0:06:40.400 they want. You still have to balance costs with revenue, 0:06:40.440 --> 0:06:43.320 and if you have to keep producing high quality content 0:06:43.680 --> 0:06:47.520 to both attract and keep customers, you might find that 0:06:47.560 --> 0:06:50.600 your profit margins are so thin they only have one side, 0:06:51.160 --> 0:06:53.920 or maybe even that you're losing money. And if you're 0:06:54.000 --> 0:06:57.919 seriously unlucky, you might find that you're on borrowed time, 0:06:58.200 --> 0:07:02.000 that you're losing money, and there's no pathway out of that. 0:07:02.600 --> 0:07:04.359 You know, the hope is that you scale up to 0:07:04.440 --> 0:07:08.520 a point where you ultimately are making more money than 0:07:08.520 --> 0:07:13.560 you're spending, but depending on how the landscape is, that 0:07:13.680 --> 0:07:16.520 might not even be a possibility. So we're going to 0:07:16.560 --> 0:07:19.680 take a look at some failed streaming services, ones that 0:07:20.240 --> 0:07:22.840 made an effort to hang with the cool kids, but 0:07:23.000 --> 0:07:26.720 ultimately flopped or faded away, as the case may be, 0:07:26.840 --> 0:07:32.160 and in one case, stopped a month after it had started. Now, 0:07:32.160 --> 0:07:34.880 I think I'm gonna start with a fairly recent example, 0:07:35.280 --> 0:07:38.720 one that I talked about a lot as the service launched, faltered, 0:07:38.800 --> 0:07:43.200 and then flopped. And that's quibi do you remember Quibi. 0:07:43.800 --> 0:07:49.520 In case you don't, here's the deal. So Jeffrey Katzenberg, 0:07:49.800 --> 0:07:54.720 who famously founded DreamWorks Animation after he left Walt Disney Studios. 0:07:55.160 --> 0:07:57.520 That story is a crazy one, by the way, full 0:07:57.720 --> 0:08:03.160 of like corporate drama, a lot of like like executives 0:08:03.640 --> 0:08:08.840 being really bitter about each other. Unfortunately, it's the kind 0:08:08.840 --> 0:08:11.480 of stuff that really blogs in a different kind of podcast. 0:08:11.560 --> 0:08:13.360 So as much as I would love to gush about it, 0:08:13.400 --> 0:08:16.640 I'm just gonna leave it here. Anyway, he decided he 0:08:16.680 --> 0:08:20.640 wanted to create a short form, highly produced video delivery 0:08:20.680 --> 0:08:24.760 platform aimed at the smartphone market. So you know, like 0:08:25.400 --> 0:08:31.080 TikTok is a user generated platform, right, But what Katzenberg 0:08:31.160 --> 0:08:35.760 wanted to do was make a studio produced version of 0:08:35.840 --> 0:08:39.400 short form video platforms. So instead of it being you know, 0:08:39.920 --> 0:08:44.600 some kid hitting on a really cool dance or something 0:08:44.760 --> 0:08:49.320 and then getting virally famous, it would be studios making 0:08:49.440 --> 0:08:52.600 content and then using this platform to distribute that content. 0:08:53.360 --> 0:08:57.200 And you could sort of see the logic behind the 0:08:57.280 --> 0:09:01.240 decision because people are on their phones a lot. They 0:09:01.280 --> 0:09:04.760 are using their phones more and more to access entertainment, 0:09:04.880 --> 0:09:08.800 and short form content works well in situations where you 0:09:08.920 --> 0:09:11.319 might not have the time or desire to sit down 0:09:11.440 --> 0:09:14.840 to an hour or more of video, so why not 0:09:14.920 --> 0:09:20.440 create a platform specifically for that kind of audience. Katzenberg 0:09:20.640 --> 0:09:24.520 founded QUIBI, which kind of stands for quick Bites. He 0:09:24.600 --> 0:09:27.920 founded it in the summer of twenty eighteen. Originally it 0:09:28.000 --> 0:09:31.240 had the name new TV, but it would change to 0:09:31.320 --> 0:09:34.520 QUIBBI a little bit later. In twenty eighteen, he hired 0:09:34.720 --> 0:09:37.720 Meg Whitman, who was the former CEO of Hewlett Packard, 0:09:38.200 --> 0:09:41.240 and she became the CEO of Quibi, and Katzenberg and 0:09:41.240 --> 0:09:45.520 Whitmen very quickly were making the rounds to various studios 0:09:45.840 --> 0:09:49.160 in an effort to drive up investments for Quibi, and 0:09:49.200 --> 0:09:52.600 they did. They raised like a billion dollars in the process. 0:09:53.160 --> 0:09:55.959 So the plan was to get production ramped up in 0:09:56.000 --> 0:09:59.959 twenty nineteen in preparation for a launch of the actual 0:10:00.240 --> 0:10:04.440 platform in the spring of twenty twenty. The hope was 0:10:04.480 --> 0:10:07.520 to create all sorts of different kinds of content across 0:10:07.559 --> 0:10:12.520 all genres reality, television, comedy, action, everything, and that they 0:10:12.559 --> 0:10:16.000 would take the form of stuff like short form television episodes, 0:10:16.080 --> 0:10:19.400 so things that lasted like ten minutes, to films that 0:10:19.440 --> 0:10:23.439 could be divided into ten minute long chapters, again, all 0:10:23.480 --> 0:10:26.920 designed to be watched on your mobile device. In fact, 0:10:27.160 --> 0:10:30.280 they even had this weird morphing technology where you could 0:10:30.440 --> 0:10:34.520 watch content either in portrait or landscape mode, and your 0:10:34.559 --> 0:10:39.120 experience of watching that program would depend upon what mode 0:10:39.160 --> 0:10:43.240 you were using, because you would get different views. Like 0:10:43.280 --> 0:10:47.199 it was shot with this in mind. It was kind 0:10:47.240 --> 0:10:51.000 of it was really ambitious, but also kind of odd 0:10:51.400 --> 0:10:53.520 to make that choice. It almost meant like you had 0:10:53.520 --> 0:10:56.240 to make two versions of your movie in order to 0:10:56.280 --> 0:10:58.240 do it so that way, like, if you're watching it 0:10:58.280 --> 0:11:01.600 in portrait mode, you're not missing some pivotal piece of 0:11:01.640 --> 0:11:05.040 information way off to the side in the frame, because 0:11:05.040 --> 0:11:07.000 it wouldn't show up due to the fact that your 0:11:07.080 --> 0:11:13.240 screen is vertical rather than horizontal. Anyway, they really pushed this, 0:11:13.559 --> 0:11:16.400 and producing stuff takes a lot of money, right You 0:11:16.480 --> 0:11:20.240 mentioned that earlier, like it is expensive to make studio 0:11:20.400 --> 0:11:23.760 level content, highly produced content. Even if you're cutting corners, 0:11:23.760 --> 0:11:27.880 it's still expensive. And meanwhile, the launch date was getting closer. 0:11:28.160 --> 0:11:31.640 Now It is impossible for us to say if Quibi 0:11:32.240 --> 0:11:36.040 would have survived if things had been a little different. Personally, 0:11:36.320 --> 0:11:38.880 I think Quibi was doomed to fail no matter what, 0:11:39.720 --> 0:11:43.040 But the decline may have taken a lot longer if 0:11:43.160 --> 0:11:46.640 things had been very different in twenty twenty, because it 0:11:46.640 --> 0:11:49.240 seems to me like the mobile focused approach really limited 0:11:49.320 --> 0:11:52.120 Quibi's usefulness. But maybe it would have held on, and 0:11:52.160 --> 0:11:54.199 maybe it would have even been a success. I'll never 0:11:54.240 --> 0:11:57.840 be able to tell, but you know, something major happened 0:11:58.000 --> 0:12:01.280 in twenty twenty. We had the COVID nineteen pandemic hit 0:12:01.800 --> 0:12:04.880 and nearly everyone was stuck at home for a long time, 0:12:04.960 --> 0:12:09.040 so the use case for Quibi was reduced significantly. I mean, 0:12:09.120 --> 0:12:11.680 here was a product that was intended to go to 0:12:11.880 --> 0:12:15.280 folks who were looking for some sort of entertainment while 0:12:15.280 --> 0:12:17.960 they were like on a bus or on a subway 0:12:18.400 --> 0:12:20.839 or standing in line, you know, doing all the things 0:12:20.840 --> 0:12:24.000 that they could not do because they were stuck at home. 0:12:24.360 --> 0:12:27.240 And at home they had access to tons of other 0:12:27.400 --> 0:12:32.960 entertainment services that were designed to work with their lifestyles. 0:12:33.280 --> 0:12:35.960 So trying to fit Quibbi in when they were no 0:12:36.040 --> 0:12:41.880 longer in those use cases it just didn't really catch. Now. 0:12:41.960 --> 0:12:44.760 At launch, Quibi did see quite a few downloads. I 0:12:44.760 --> 0:12:47.400 think it hit like number three on the most popular 0:12:47.440 --> 0:12:50.160 apps for the week that it debuted, but then the 0:12:50.200 --> 0:12:54.920 following week, those download numbers dropped drastically. Signing up would 0:12:54.960 --> 0:12:57.400 give you access to Quibi for three months for free, 0:12:57.520 --> 0:12:59.719 and after that you were supposed to pay for a subscription. 0:13:00.120 --> 0:13:03.280 So about three quarters of Quibi's users just opted to 0:13:03.360 --> 0:13:06.360 bounce off the service rather than convert to a paid 0:13:06.400 --> 0:13:09.840 subscription once their free trial was up. So the company 0:13:09.880 --> 0:13:12.560 attempted to bail water out of the sinking boat, but 0:13:12.720 --> 0:13:15.600 six months after going live, the writing was on the wall, 0:13:15.679 --> 0:13:18.760 so in mid October twenty twenty, the Wall Street Journal 0:13:18.800 --> 0:13:21.080 reported that Quibi was on the way out, and by 0:13:21.160 --> 0:13:25.000 December of twenty twenty, the lights had gone off in Quibi. 0:13:25.440 --> 0:13:29.640 Roku ended up purchasing Quibi's library, and thankfully creators retained 0:13:29.640 --> 0:13:32.240 the rights to their intellectual property, which gave them the 0:13:32.320 --> 0:13:35.280 chance to find some other platform to host their work. 0:13:35.559 --> 0:13:37.880 We're going to talk about a different company later here, 0:13:38.160 --> 0:13:41.520 where it's like the opposite of that to an extreme. 0:13:42.160 --> 0:13:44.840 But yeah, Quibi came and went so fast it didn't 0:13:44.880 --> 0:13:49.480 even say goodbye. Now there's a lot more we're going 0:13:49.520 --> 0:13:53.280 to talk about today with various failed streaming services, But 0:13:53.360 --> 0:13:55.600 before we get into all of that, so that we 0:13:55.760 --> 0:14:06.839 don't fail. Let's take a quick break to thank our sponsors. 0:14:09.440 --> 0:14:13.640 So yeah, Quibi. There were some major players in entertainment 0:14:13.640 --> 0:14:17.400 behind the scenes, both directly working for Quibi and also 0:14:17.600 --> 0:14:21.240 investing into the company. But our next example was an 0:14:21.280 --> 0:14:26.640 actual extension of a truly massive media conglomerate. So NBC Universal, 0:14:26.720 --> 0:14:30.880 which itself is a branch of Comcast, decided to dip 0:14:30.960 --> 0:14:34.680 its corporate tow in the subscription based video on demand 0:14:34.800 --> 0:14:39.680 service back in twenty fifteen. So a media executive named 0:14:39.800 --> 0:14:43.640 Evan Shapiro led the charge, and the goal was to 0:14:43.680 --> 0:14:48.280 create a video service centered around comedy. So the question 0:14:48.520 --> 0:14:52.640 was could yuck yucks bring in the buck bucks. The 0:14:52.680 --> 0:14:55.960 service would be called CISO, and it launched to a 0:14:56.000 --> 0:14:58.840 small beta test in December twenty fifteen, but the actual 0:14:58.880 --> 0:15:03.800 service went live in early twenty sixteen. Shapiro spared no 0:15:03.920 --> 0:15:06.600 expense when it came to curating content for the service. 0:15:06.920 --> 0:15:11.360 He wanted all things comedy, including older material like episodes 0:15:11.360 --> 0:15:15.040 of Monty Python's Flying Circus or the Great Sketch show 0:15:15.120 --> 0:15:18.080 The Kids in the Hall. That Saturday Night Live library 0:15:18.160 --> 0:15:19.920 was part of it. Remember this was an extension of 0:15:20.040 --> 0:15:24.440 NBC Universal. He also initially had eyes on making CISO 0:15:25.120 --> 0:15:29.440 the exclusive platform to stream episodes of the Office and 0:15:29.520 --> 0:15:34.200 Parks in rec Those plans would ultimately fall through, not 0:15:34.320 --> 0:15:38.080 Shapiro's fault, really, but it was a part of his 0:15:38.160 --> 0:15:40.200 plan where he thought, if we can do this, then 0:15:40.200 --> 0:15:44.320 that's going to attract a huge base of users. He 0:15:44.400 --> 0:15:46.960 made licensing deals left, right and center. He brought in 0:15:47.000 --> 0:15:49.920 a ton of popular comedy under one roof, and he 0:15:49.960 --> 0:15:53.560 also empowered his staff to produce original content for the 0:15:53.600 --> 0:15:58.280 platform as well. NBC Universal was kind of using CISO 0:15:58.640 --> 0:16:01.480 as a sort of experiment mental platform, the idea of 0:16:01.520 --> 0:16:05.880 being that if a comedy centric video on demand service 0:16:06.000 --> 0:16:10.400 and over the top streaming service, if that could work well, 0:16:10.480 --> 0:16:15.160 then NBC Universal might launch other genre or interest specific 0:16:15.200 --> 0:16:19.480 streaming platforms in the future, like maybe one based around horror. 0:16:19.560 --> 0:16:23.640 Universal famously has a really deep horror library that they 0:16:23.720 --> 0:16:28.040 keep trying to exploit in the modern era and often 0:16:28.080 --> 0:16:31.720 failed to do so, or maybe like a streaming service 0:16:31.760 --> 0:16:35.400 that's really focused on things like reality television programming, which 0:16:35.760 --> 0:16:38.760 arguably can be scarier and more disturbing than horror is. 0:16:39.560 --> 0:16:43.720 The cisow subscription was just three dollars ninety nine cents 0:16:43.760 --> 0:16:47.640 per month, when it launched. The initial catalog was heavy 0:16:47.640 --> 0:16:50.320 on stuff that comedy fans were likely to gravitate toward, 0:16:50.640 --> 0:16:55.480 including a sizable library of British comedy that could actually 0:16:55.480 --> 0:16:57.640 be a little tricky to access here in the United 0:16:57.680 --> 0:17:00.840 States outside of some notable exceptions like everyone's heard of 0:17:01.400 --> 0:17:04.560 Bonty Python's Flying Circus. But there are a lot of 0:17:04.600 --> 0:17:09.240 other British comedies that the average American may not be 0:17:09.320 --> 0:17:12.720 familiar with. Some of them are really famous. I mean, 0:17:13.280 --> 0:17:16.520 like some you might have encountered on other channels like 0:17:16.600 --> 0:17:19.240 Adult Swim showed The Mighty Boosh for a while, which 0:17:19.280 --> 0:17:24.040 is a bizarre, absurd comedy series. And then there were 0:17:24.040 --> 0:17:26.480 some sketch comedies, like one of my favorites was that 0:17:26.560 --> 0:17:32.119 Mitchell and Weblook, which Netflix carried briefly and then it 0:17:32.160 --> 0:17:35.800 became unaccessible to an American public. I finally ended up 0:17:35.800 --> 0:17:39.280 breaking down and buying the British DVDs and a region 0:17:39.359 --> 0:17:41.960 free DVD player so I could find I could watch 0:17:42.000 --> 0:17:45.480 them again. But anyway, the goal of CISO was to 0:17:45.520 --> 0:17:49.159 create original content. That was the long term goal, to 0:17:49.359 --> 0:17:52.880 make its own content that would build its own following, 0:17:53.400 --> 0:17:56.000 much like Netflix had done with things like Orangees of 0:17:56.000 --> 0:17:59.560 the New Black and A House of Cards and Stranger Things. 0:18:00.080 --> 0:18:03.600 Now every streaming services is following that same kind of philosophy. 0:18:03.920 --> 0:18:08.280 So you use the library to first attract your ground 0:18:08.320 --> 0:18:11.879 base of subscribers, and then you create original content to 0:18:11.920 --> 0:18:15.560 attract new ones and to keep everybody there. Now, one 0:18:15.640 --> 0:18:19.760 early mistake that the executives made over at SISO, though 0:18:19.760 --> 0:18:22.920 according to Shapiro, was actually folks higher up at NBC 0:18:23.080 --> 0:18:26.199 Universal that made this mistake, was to flinch at a 0:18:26.280 --> 0:18:29.480 deal that would have made CISO the exclusive streaming home 0:18:29.560 --> 0:18:33.840 for the Office. As I mentioned earlier, so Netflix was 0:18:33.880 --> 0:18:37.680 really interested in having access to the Office. They really, 0:18:37.720 --> 0:18:42.199 really really wanted it, and the plan was originally that 0:18:42.320 --> 0:18:45.520 CISO was going to get the exclusive deal. But Netflix 0:18:45.560 --> 0:18:49.600 made NBC Universal executives an offer they couldn't refuse, and 0:18:49.640 --> 0:18:54.120 they agreed to let Netflix get access to those programs, 0:18:54.119 --> 0:18:57.600 which meant SISO would not have that exclusivity. And even 0:18:57.600 --> 0:19:00.320 if SISO were to show episodes of the Office, the 0:19:00.320 --> 0:19:02.639 fact that you could already get it on Netflix and 0:19:02.680 --> 0:19:05.600 a lot of people were already Netflix subscribers meant you 0:19:05.640 --> 0:19:09.520 weren't going to lure Netflix users to SISO, just based 0:19:09.560 --> 0:19:13.240 on the office, so one of the things that possibly 0:19:13.440 --> 0:19:17.600 could have brought over a larger base of subscribers fell through. 0:19:18.119 --> 0:19:20.920 On the flip side, it also meant that Ciso had 0:19:21.000 --> 0:19:25.680 some budget freed up for making original content. Now apparently, 0:19:26.119 --> 0:19:29.040 Shapiro initially was told that NBC Universal was going to 0:19:29.040 --> 0:19:32.959 have this enormous marketing campaign to promote Ciso, like a 0:19:33.040 --> 0:19:37.359 ten million dollar effort to highlight the service across the 0:19:37.400 --> 0:19:41.600 company's various networks, But that really didn't manifest and Ciso 0:19:41.720 --> 0:19:47.199 received relatively little marketing support, which not surprisingly meant that 0:19:47.240 --> 0:19:50.760 subscription numbers were lackluster. I mean, it's hard to get 0:19:50.760 --> 0:19:53.520 excited about subscribing to a service if you've never heard 0:19:53.520 --> 0:19:56.760 of it, or if the promotion you see doesn't really 0:19:56.840 --> 0:20:00.399 talk it up enough. Making matters worse is that Ciso 0:20:00.520 --> 0:20:04.600 had its own video player that occasionally had technical issues 0:20:04.880 --> 0:20:08.000 and wasn't compatible with some of the hardware consumers used 0:20:08.040 --> 0:20:12.440 to access streaming content. So again, let's contrast this with Netflix. 0:20:12.880 --> 0:20:15.760 Netflix had made a decision a long time ago to 0:20:16.040 --> 0:20:19.200 pretty much make sure it was anywhere where there's a screen. 0:20:19.800 --> 0:20:23.080 Netflix worked to create apps that were compatible with video 0:20:23.160 --> 0:20:28.879 game consoles with streaming boxes connected to televisions to smart TVs. 0:20:29.400 --> 0:20:32.080 In fact, like if you have a fridge that has 0:20:32.119 --> 0:20:34.520 a video screen incorporated in it, there's a chance that 0:20:34.560 --> 0:20:38.280 there's a Netflix app native for that particular device. But 0:20:38.440 --> 0:20:42.600 Comcast's approach wasn't as broad a and this is kind 0:20:42.600 --> 0:20:46.960 of a pun a spectrum as what Netflix was taking now. 0:20:47.000 --> 0:20:50.359 CISO did end up joining Amazon's streaming partners program in 0:20:50.440 --> 0:20:53.480 mid twenty sixteen. That helped a little. By the end 0:20:53.520 --> 0:20:56.600 of twenty sixteen, it was finally compatible with Apple TV. 0:20:56.920 --> 0:20:58.879 But you know, this was like a full year in 0:20:58.960 --> 0:21:03.000 operation when these things started to click into place. While 0:21:03.040 --> 0:21:05.720 CISO failed to take off to the moon, it did 0:21:05.800 --> 0:21:08.879 grow in its second year, so in twenty seventeen it 0:21:08.920 --> 0:21:13.800 began an upward trajectory for subscriber growth. The famous podcast 0:21:13.840 --> 0:21:16.400 My Brother, My Brother, and Me launched a television show 0:21:16.520 --> 0:21:20.040 on the network in twenty seventeen. They often joke about 0:21:20.040 --> 0:21:25.359 how the CISO platform subsequently died on their podcast a lot, 0:21:25.680 --> 0:21:27.919 But while they make jokes about it, their show was 0:21:27.960 --> 0:21:31.280 not likely to have been a contributing factor to ciso's demise. 0:21:31.920 --> 0:21:34.959 The service was spending a lot more money than it 0:21:35.040 --> 0:21:38.720 was bringing in and Arguably this was necessary in order 0:21:38.760 --> 0:21:41.760 to scale to a level that could compete with bigger, 0:21:41.880 --> 0:21:46.080 more established services like Netflix, But a prestige show on 0:21:46.160 --> 0:21:51.160 cso called There's Johnny About Johnny Carson may have been 0:21:51.160 --> 0:21:54.760 the straw that broke NBC Universal's back. It was an 0:21:54.880 --> 0:21:58.720 expensive show to produce and with the numbers headed in 0:21:58.760 --> 0:22:00.920 the wrong direction, At least for the higher ups at 0:22:01.000 --> 0:22:04.879 NBC Universal. It meant Evan Shapiro got his walk in 0:22:04.960 --> 0:22:09.280 papers in May twenty seventeen. CISO kept on going for 0:22:09.320 --> 0:22:11.800 a little bit, but it didn't last long. A couple 0:22:11.800 --> 0:22:14.520 of months after Shapiro had left, SISO announced it would 0:22:14.560 --> 0:22:16.600 be shutting down by the end of the year, and 0:22:16.640 --> 0:22:18.800 it didn't even make it that far. It actually went 0:22:18.920 --> 0:22:24.560 dark in mid November twenty seventeen. Ciso's failure is complicated. 0:22:24.600 --> 0:22:27.280 It probably relates to a lot of different factors. One 0:22:27.320 --> 0:22:29.920 is that it didn't get the marketing push it needed 0:22:29.920 --> 0:22:32.760 from its parent company, a less an NBC Universal appears 0:22:32.760 --> 0:22:35.879 to have learned because you can't turn around without running 0:22:35.920 --> 0:22:39.359 into a promo for Peacock these days, so they've definitely 0:22:39.440 --> 0:22:43.240 changed their tune on that. But for another SISO failed 0:22:43.280 --> 0:22:46.440 to explore ad supported options, which potentially could have brought 0:22:46.480 --> 0:22:50.640 in revenue to help offset the costs. Third, some of 0:22:50.680 --> 0:22:53.560 the moves to produce original content might have been a 0:22:53.560 --> 0:22:56.960 bit too ambitious so early on, Like it's really good 0:22:57.520 --> 0:23:00.640 to have the goal to create prestige content, but it's 0:23:00.640 --> 0:23:03.040 possible that the service needed the ground to be a 0:23:03.080 --> 0:23:07.680 touch more firm before trying to create something like There's Johnny. 0:23:07.920 --> 0:23:10.680 This is no shade on There's Johnny. I'm not saying 0:23:10.720 --> 0:23:13.760 that that was a bad series by far, just that 0:23:14.560 --> 0:23:17.040 it was. It was a big risk considering how much 0:23:17.080 --> 0:23:20.800 it costs, and maybe the wise move would have been 0:23:20.880 --> 0:23:24.119 to hold off just a bit longer to try and 0:23:24.640 --> 0:23:28.040 establish a standing before going into it. It's hard to say, 0:23:28.600 --> 0:23:31.320 like these things in hindsight, it's really easy to say 0:23:31.320 --> 0:23:32.840 one way or the other. But at the time, I'm 0:23:32.880 --> 0:23:35.960 sure these decisions were not easy ones. Some of the 0:23:36.000 --> 0:23:38.720 content that was on CISO would end up going to 0:23:38.760 --> 0:23:43.960 other platforms, including another one then no longer exists VRV 0:23:44.200 --> 0:23:48.159 or VERVE. So the history of VRV or I'm just 0:23:48.200 --> 0:23:50.480 gonna call it VERV why not. The history of VERV 0:23:50.560 --> 0:23:53.680 is also pretty short. So for one thing, it launched 0:23:53.720 --> 0:23:56.919 in late twenty sixteen, so CISO was wrapping up its 0:23:56.960 --> 0:23:59.840 first year in twenty sixteen. That's when Verve launched, and 0:24:00.119 --> 0:24:03.199 it was sort of a sister service to the anime 0:24:03.400 --> 0:24:08.560 focused streaming platform called crunchy Roll. Crunchy Role still exists. 0:24:09.040 --> 0:24:13.320 Verv was kind of a similar streaming service, but Crunchy 0:24:13.400 --> 0:24:16.920 Role focused on anime. Verve would end up getting lots 0:24:16.920 --> 0:24:19.880 of different content from all sorts of companies. They included 0:24:20.080 --> 0:24:23.920 companies like Geek and Sundry, which was really a YouTube 0:24:23.920 --> 0:24:29.760 studios channel. Rooster Teeth was another company that provided content 0:24:29.840 --> 0:24:33.240 to VERV, and other partners included College Humor, which would 0:24:33.240 --> 0:24:36.920 subsequently develop its own subscription streaming service called Dropout TV 0:24:38.720 --> 0:24:41.639 Machinima dot Com, which we will talk about more in 0:24:41.680 --> 0:24:44.159 a second. So there's a spoiler. We know Maine is 0:24:44.160 --> 0:24:46.800 not gonna last forever. They were also a partner with VERV. 0:24:47.400 --> 0:24:50.320 Shutter provided content to verv for a while. Shutter is 0:24:50.320 --> 0:24:55.159 a horror based company Rifftracks, which is made up of 0:24:55.240 --> 0:24:57.480 people who used to be part of Mystery Science Theater 0:24:57.600 --> 0:25:01.840