My 1600th Post - Why Vinyl Matters ...

I always mark my centenary posts with a reflection of some sort.  This is no exception.  Here's my 1600th.  It's about vinyl.  Yes, vinyl.  And it's not simply a nostalgia piece.  It's about where I'm at. Right here.  Right now.
Here's the thing.  Although I am a "digital guy," I not only appreciate -- I crave (as we all do, more than we think) -- the offline physical world.  That's what this post is about.  A reminder of how important that physical reality is in this increasingly digital world where experiences and purported meaning become more and more virtual and, hence, remote.
Here's a reminder.  "Real" experiences matter most.  Touching.  Feeling.  Sharing.  Communing.  
At last year's Grammy's, I attended a gathering of music industry execs at a swank Beverly Hills hotel. But this was no typical event. It had some real meaning. Real appreciation for the power of music (something about which I absolutely believe ... because I feel it every day ... my therapy ... my chill).
After speaking with some of the guests for a few minutes at this event, a featured guest -- a young woman sitting behind a typewriter -- asked me to sit down.  She was an author.  A poet of sorts. And, her tool of the trade was a non-electronic Smith-Corona.  Remember those?  Old-fashioned typewriters that no one uses anymore.  As she typed, I asked her what spurred her, as an artist, to type with a manual Smith-Corona in our digital world.  She answered that it was precisely that -- the search for the physical ... the tangible -- in our increasingly virtual digital world.  And she told me that she was not alone.  That typewriters are making a comeback.  And, here's the thing.  This was no simple nostalgia.  This was not me talking.  She was young.  No more than 25.
Which brings me to music -- and to vinyl.  We all know that vinyl too is  coming back in a big way.  And the millennials are leading the way.
What's going on here?
It's simply this.  It is the search for something tangible.  Something that can be touched.  Something that has some kind of feeling of permanence -- a permanence that gives it increased meaning.  Digital doesn't have that.  You can't go to a digital store and flip through albums and discover great new music that way.  And, "that way" is very very cool.  And, fundamentally different.  You actually touch that vinyl.  You make the "connection" -- and it connects with you.  This is something that digital natives have missed -- and want to bring back.  Amazon -- the king of everything "e" -- recognizes this.  That's why they are bringing back physical bookstores in which we can all simply hang out, sift through stacks of actual books, and browse to our hearts delight.
We see this counter-reaction to digital in our interactions as well.  Music festivals have sprouted everywhere at an accelerating pace.  Millennials save up all year and spend millions (billions) to make annual pilgrimages to Coachella, Bonnaroo, Outside Lands, Life Is Good, and hundreds of other festivals all over the planet.  Why?  It goes beyond the music (although the music itself is tribal).  It goes to our core desire as human beings to have a sense of physical community in our increasingly disconnected (connected?) virtual digital online social media world where we have hundreds and sometimes thousands of friends ... but, how many of those are real ... or matter?
That's why vinyl represents a movement.  It is a search for something physical and a bit more permanent.  For gatherings of the tribes.  For meaning.  For experiences. 
And, after all, isn't life ultimately about real experiences and meaning ... and not just accumulating virtual "stuff" (or physical stuff for that matter)?

Magic Leap(s) To $1.4 Billion - AR Hype?

Magic Leap, the enigmatic augmented reality (AR) company tucked away about as far as possible from Silicon Valley (in Florida), just scored an astounding new round of $793.5 million (at a post-money valuation of $4.5 billion).  That brings its overall total financing haul to nearly $1.4 billion.  Insane, right?  A sign of a coming tech melt-down apocalypse?  Reason overtaken by AR hype?

Well, not so fast.

First, AR as an industry is expected to be globally massive -- research firm Digi-Capital pegs it at being $120 billion by 2020.  And, despite the tech and media world's current fixation with virtual reality (VR) -- which is here and now -- further-out AR is expected to dwarf the overall VR market (which Digi-Capital pegs at a comparatively modest $30 billion).  That means that AR ultimately will follow the 80/20 rule -- grabbing 80% of the overall "immersive" market.  Why?  Because AR's partially (rather than fully) immersive reality gives it much broader consumer and enterprise application.  Think of it as the AR market being analogous to the ubiquitous mobile market, whereas the VR market is more analogous to the more limited game platform market.  My firm, Manatt Digital Media, previously laid all of this out (and other important factoids) in a compelling VR/AR infographic that lays out the overall market opportunity and key players in it (and is worth checking out here via this link).

Second, with this "mother of all rounds," Magic Leap does much more than leap over competing AR players -- it catapults them.  How can other start-ups compete against that?  Mega-rounds of capital don't guarantee success, but it certainly doesn't hurt.  That kind of money empowers Magic Leap to grab the land in this global AR/immersive land-grab.  It also affords long-term experimentation and patience to "get it right."

Third, just think of the pedigree and diversity of Magic Leap's overall syndicate.  It includes Chinese e-commerce giant Alibaba (which led this new round), Google, Qualcomm, Warner Brothers, and J.P. Morgan (just to name a few).  Those are respectively behemoths in (i) international commerce and social media (among its many "talents"), (ii) search and video (well, all of you know who Google is), (iii) mobile, (iv) content and media, and (v) finance.  Now that's a well-rounded round of players that, together, are committed to freezing out any competition and drive overall success across all consumer and enterprise channels with their collective reach and influence.

Again, none of this guarantees product excellent, market acceptance, and overall success at mega-scale.

But, it certainly doesn't hurt.

So, hype or cold hard reason?

Yes, there may be some froth here.  But, with an endless string of potential suitors all fighting for some love in this hyper-competitive round and amidst this opportunity, this valuation was cold hard reality.

In other words, the invisible (augmented?) hand in action.

Yahoo Says "No Mas!" Officially Puts Itself On The Block

Well, ladies and gentlemen, Yahoo! is now officially on the block -- announcing yesterday that it is seeking "strategic alternatives" -- a move it signaled just a couple months back.  (Concurrently, Yahoo! also announced that it is "simplifying" its business -- translation, laying off 15% of its employees (essentially to ready itself for a sale)).
(Image to the left courtesy of Gizmodo.)

As I wrote not so long ago in an earlier post which is worth reconsidering here given the news, Yahoo!'s fate is a wake-up call for all of us in the digital media business (and presents an opportunity for the ultimate buyer, so long as it moves aggressively).

What happened here?

Well, Yahoo!'s media strategy certainly didn't help.  It failed, plain and simple.  I wrote a detailed post about this about one year ago (titled "Yahoo Kills Its YouTube Killer - So What's Still Alive?") when Yahoo! threw up the white flag to its long-rumored, but not-to-be, YouTube "killer."

As I wrote then, that move "demonstrat[ed] Yahoo!'s continued indecision and overall flailing (failing?) in the OTT video content space.  And, this certainly is not an opportune time for flailing -- for an unfocused/scattered/disrupted (you choose the word) video strategy (or complete lack thereof?) when the video focus/strategy/execution of others (behemoths like Facebook and Snapchat and others like Vessel) are ever more sharp, precise, resourced, abundantly clear ... and, with some, massively successful (by all accounts, Facebook is killing it)."

Sad indeed.  After all, Yahoo! had every opportunity to massively succeed -- it controlled uniquely compelling resources and ingredients (that I discussed long ago in a blog post from 2013) that gave Yahoo! the potential to drive real success as an alternative to YouTube and in the burgeoning OTT world.  But months (now years) ticked by and, alas, little came (except a revolving door of new execs and departing frustrated execs).  Yes, there was significant video activity, but no recognizable strategy to it all (nor any real reported success in those efforts).  As I reported back then, many senior execs with whom I had spoken confirmed overall frustration time and time again.  In the words of one respected digital exec -- and former Yahoo! senior exec on the content side who left in frustration -- "Yahoo!'s video strategy had been overtaken by confusing multiple layers of decision-making, internal conflict, and what some even called chaos."  Nor did it help that Yahoo! failed in its attempt to buy a controlling stake in Dailymotion, Europe's YouTube.  Not its fault (French regulators killed that deal), but still failure to launch.

Meanwhile, as Yahoo! flailed, the video world radically changed.  What once was, in essence, a YouTube-only video world for creators is now, of course, a world of multiple competing video platforms with massive competing players like Facebook, Snapchat, Netflix, Amazon, Hulu, Sling TV (and the burgeoning number of stand-alone OTTs like NBC's Seeso).  So, as I wrote last April, and faced with those realities, "Yahoo! is running out of time amidst the current great OTT video land grab of 2015."

But, even less than one year ago, I still felt that Yahoo!'s media strategy was potentially salvage-able if it "ha[d] a major Dailymotion-like acquisition trick up its sleeve that will soon come to light and finally catapult it into the OTT video big leagues (where it absolutely could belong if it had the will and focus)."

Sadly, that simply was not to be (although it could have been).

And now here we are ...

Comcast/NBCUniversal M-GO(es) For It! Fandango Becomes An OTT

Comcast/NBCUniversal.  Who knew?

As we closed out 2014 (about one year ago), that U.S. media giant stood where virtually all other global media giants stood when it came to digital -- i.e., essentially nowhere.

What a difference a year makes (make that more like 6 months).

Since August 2015, check out Comcast/NBCUniversal's digital mega-moves:

-- $200M investment in Vox Media
-- $200M investment in BuzzFeed
-- Comcast launches mobile and millennial-first, short-form driven "Watchable" service
-- NBCUniversal launches longer-form stand-alone OTT "Seeso" service
-- and, oh yes, don't forget NBCUniversal's continued joint venture partnership in Netflix competitor Hulu which, in 2015, turned on the cash spigot in a massive way to secure exclusives to Seinfeld and others -- and also to double down on originals.

And now this.  Just a couple days back, Comcast/NBCUniversal quietly entered the full-on OTT platform space all alone (and without any JV partners) when its Fandango service bought long-neglected M-GO out from under its owners DreamWorks Animation and Technicolor (financial terms weren't disclosed).

Bravo Comcast/NBCUniversal.  Bravo! (which is an NBCUniversal network by the way).  Comcast/NBCUniversal is now well ahead of the curve versus other major U.S.-focused media giants -- certainly the one to watch.  Time for others to take a look at what they are doing and, if nothing else, use that for inspiration to do something on their own ...  In most cases, finally do something, because the clocks on change are only going to spring forward faster.

Sundance Has NOT Seen This Movie Before -- Netflix, Amazon Shoot To Kill

Another Sundance is nearly in the can.  And, we have NOT seen this movie before.

Yes, digital isn't new to Sundance.  But, leading streaming services/OTTs out-bidding the "traditional" studio competition for prestige indie movies is.  With Sundance 2016, Netflix and Amazon showed that they are in it to win it.  Exhibit A -- Amazon outbid Fox Searchlight, Focus Features and other studios to snag festival favorite drama "Manchester By the Sea" -- paying $10 million for those rights.  While this may not faze us anymore in the midst of the massive media transformation that surrounds us, just sit back for a second.  That was essentially unimaginable just two years ago.  The "traditional" system is being shaken up, disrupted, up-ended, _______ (fill in the blank with your own choice word).

This year's NATPE in Miami tried to maintain a brave face amidst all the tumult, with buyers and sellers roaming the halls in the same inefficient manner they have for decades.  I was there.  Yes, many digital-focused/multi-platform panels took the stage.  And, those in the audience listened.  But, did they really?  Do they really "get" it?  Of course some do.  But, what most struck me at NATPE was how few really did!  Old habits die hard.  You  can see that ... feel that ... at NATPE.

Professor, author, screenwriter, producer (and overall Renaissance man) Neil Landau punctuated all of this at NATPE when he unveiled his new book "TV Outside the Box" and discussed some of its major themes.  Here are some choice nuggets I wrote down as I listened -- conclusions he reached via his research -- that should resonate with all of us.  They certainly do for me.  NOTE -- all of these are Neil's direct quotes.

-- "Whether you are AVOD or SVOD, if you're not making original content, then you're toast."
-- "Niche is the new mainstream."
-- "Binge viewing is here to stay.  It's like reading a page-turner."
-- "There can never be too much good content."
-- "You can't manufacture authenticity."
-- "There is not a formula anymore for creating good content."
-- "Originality!"
-- "For content to be global, it must have multiple entry points.  That is why ensemble casts work."
-- "Television linear time slots will go away within 5 years."
-- "Change [as in business models] is good if it increases connection."  (Neil was commenting that all of this disruption is a net positive because, among other things, all of this free-flowing OTT borderless content leads to the "global water cooler" and seeds empathy and connection.)

MDM January Newsletter - Top 10 Predictions for 2016

This post is from the January edition of the Manatt Digital Media newsletter.  To sign up for our monthly newsletters, access that link.

It's a new year, and that, of course, means it's pundit time. Last year's headline story in digital media was the rapid ascension and burgeoning number of over-the-top (OTT), cord-free streaming video services, led by Netflix. 2015's secondary headline was the coming storm of virtual reality (VR). Now let's look ahead. Here are Manatt Digital Media's top 10 predictions for digital media in 2016.
(1) VR will be the headline story, as what was just recently written off as fad for most in media will cross into mass-market status. Several million premium headsets (not just Google Cardboards) will be sold by major consumer electronics companies that have together invested billions of dollars to create market demand. It will feel like the early mainstreaming days of the game console market. While gamer experiences will dominate VR in 2016, live-action VR will also show promise as the language of VR storytelling develops. Jaunt, fresh off its new, massive round of $65 million from Disney and other media giants, will be one of the companies to lead the way.
(2) Not far behind, consolidation will rule the day, as traditional media companies—both domestic and international—will accelerate their appetite for digital-first M&A. These strategic bets will be driven by the now full realization that new DNA is needed to play effectively in our transformed mobile-first, social and Millennial-driven media environment. Those few remaining multichannel networks (MCNs) with scale and HBO-like "originals" strategies are in the line of sight, as are leading digital-first production companies that sell to the growing list of OTT providers that pay for exclusive programming. For creators, this heralds a new "Golden Age" of content. And for consumers, this means choice like never before. Too much? Companies that can help navigate it all will be in demand.
(3) The multiplatform-ization of media will show no signs of abating, as the "Great Unbundling" of pay-TV packages will continue and the list of YouTube challengers (such as Facebook and Snapchat) and challenging stand-alone OTT services grows. New OTTs increasingly include subscription service from both traditional media companies (such as NBCUniversal's "Seeso") and a growing list of vertically focused media companies (such as leading dance/music-focused MPN DanceOn, in which Manatt Venture Fund is invested).
(4) Live streaming (both event and individual/social) will join video on demand (VOD) as a key area of focus for media companies both young and old. Live social network YouNow has raised $15 million this year and is one to watch, while Twitter acquired Periscope for about $100 million. Will Meerkat be next in 2016?
(5) On the music side, major services' (Spotify, Pandora, Rhapsody) subscription-focused business models will continue to look to diversify. That's why they smartly made significant strides in that regard in 2015. Case in point: Pandora, which acquired Ticketfly for $450 million.
(6) eSports—already quietly massive—will be quiet no longer, as an increasing number of stadiums will overflow with teens cheering for their favorite e-Athletes (and major brands will fight to reach them). 2016 may be the year that leading e-Athletes organize to bargain collectively. And traditional sports and live-event megaplayers (AEG) may consider M&A to enter this digital sports world that is here to stay.
(7) The video game industry will continue to outpace and dwarf traditional media titles in terms of revenues due to 2016's VR and eSports rapid adoption.
(8) Wearables and digital health will expand significantly. The Apple Watch is just an early prototype for things to come. Just imagine the resulting data and diagnostic possibilities for mobile, democratized healthcare. Those will come alive in 2016.
(9) Borderless global partnerships among previously territory-constrained media and tech companies will accelerate amid these new digital realities. Expect an increasing array of major strategic moves like those seeking to challenge Netflix (much like 2015's HOOQ with Warner Bros. and SingTel in Asia).
(10) Finally, expect the unexpected. Things move too fast as content and tech continue to collide. As close as we are to the action, new entrants and innovators will undoubtedly surprise.

Musicgooroo - MUST CHECK OUT New Music Site

Long-time readers of my blog know that I'm a passionate, hard-core music fan.  Now I have an important new source for indie and innovative new music, artists and bands -- and insights that surround them.  It is called Musicgooroo (click here to check it out) -- and it just launched last night.

Apart from Musicgooroo's great content, here's the best part.  The site's creator and editor -- its music guru -- is my very own 16 year-old daughter Hunter, who has been my partner in musical crime since her earliest of days.  We have streamed music throughout our house 24/7 ever since her beginning, she has attended innumerable festivals and concerts during her young life, she already has completed a major music internship, and her thirst and taste for music are simply part of her DNA (a combination of nurture and nature, I believe).  But, it's 100% Hunter -- all of it.  The vision, the execution, the passion.  And, Hunter's musical tastes and insights are deep, sophisticated.  Forget the saying "well beyond her years."  They simply "are."  She unearths artists and bands that you will like, you should know ... but don't.

I'm so proud of her!

But, most of all, selfishly, I'm just happy to finally find a music taste-maker who speaks to me and my music sensibilities (and helps me sound smart as I plot my next concert or festival experience).

Check out Musicgooroo at -- on Instagram at @themusicgooroo -- and on Spotify at musicgooroo (to listen to the latest sounds Hunter is listening to).