Speaker 2 0:02

Welcome to this week's edition of the Dan Rayburn podcast, the show that curates the streaming media industry news that matters most, unvarnished, unscripted and providing you with the factual data you need to know, without any of the hype, the Pulse of the streaming media industry.

Speaker 3 0:24

Welcome to the Dan Rayburn Podcast. I'm Dan Rayburn, along co-host Mark Donegan. Back for another week of a lot of news, some earnings.

Speaker 1 0:32

Yes.

Speaker 3 0:33

We're recording on Friday, february 14th, so after the Super Bowl. So, mark, let's just jump right into that.

Speaker 1 0:42

How did your?

Speaker 3 0:42

team do Dan. Oh yeah, go team.

Speaker 1 0:45

Go team, yeah, yeah yeah, I don't. Yeah, did they? Did they decide just to kind of stay in the locker room?

Speaker 3 0:51

yeah, you know I don't care about football at all to be, honest and I have no time to watch it. So same with same with me yeah, whatever two teams play. Hey, great congratulations to the teams for making it to the super bowl. It's obviously absolutely uh, but you know it's. It was interesting to see some of the coverage that came out after. Great congratulations to the teams for making it to the Super Bowl.

Speaker 3 1:13

It's obviously a feat, but you know it was interesting to see some of the coverage that came out after I did live blogging again during it, testing devices and whatnot. Yeah, amazing job. Quick shout out to the Fox team. Just thank you to them because they did really give me quite an insight into the Super Bowl this year and obviously there was only certain things I could talk to, but it's just great to see from the inside how some of the things work and some of the decisioning they make. So overall I think they did a great job.

Speaker 3 1:35

We got numbers, so let's go through those real quick. So Tubi peaked at 15.5 million concurrent devices. I know the press release said viewers, but note that's devices, just to be accurate there. They had an AMA of 13.6 million across all their game day programming because they started the stream early doing interviews and that type of thing. They had 24 million unique viewers. I like the fact they put out a unique number because we don't get that many years. So unique viewers across all programming. Telemundo and NFL Digital Properties added almost another million AMA, so that's interesting as well.

Speaker 3 2:18

Now a couple of things to note here is that, as I wrote in my blog posts, over 14 years of streaming the Super Bowl, the viewership methodology changes. So concurrent users, simultaneous streams, peak viewers, ama, average minute audience. It's a little hard to compare year over year. The Super Bowl 100% exactly the same. Also, remember that some years the Super Bowl required authentication, other years it didn't.

Speaker 3 2:45

I did see Mark a lot of members of the media getting wrong that this is the first year the Super Bowl has been streamed free. That's 100% wrong. So last year it was on Paramount Plus. It required a subscription, but during the Super Bowl, paramount had a free trial so you could watch it for free. Also, also year before 2023 and 2021, when it was on fox, it absolutely did not require authentication. I don't know why people keep saying it did fox sports, foxcom, the app. It was free. You did not have to authenticate. So it's not the first time it's been free. It's certainly the first time the streaming bowl, the Super Bowl, streamed on a free fast service, tubi. So that is new. Outside of the US, dazn was selling it for 99 cents, so it really is a pay-per-view.

Speaker 3 3:37

That's pretty inexpensive, yep cheap. However, no details of any kind are being released by the company of what or who the viewership was. Yeah, so that we don't know. So we do have some good, good stats here now. The 2024 number from paramount, uh, that 8.5 million number that we're all using. Just note that that's peak and that's not ama. So we don't know what AMA was for 2024. The Super Bowl started streaming in 2012 and every single year, fox, nbc Sports, cbs Sports has always put out a press release, but the one year they didn't was last year. Paramount, really. Cbs Sports didn't. Was last year paramount, really? Cbs sports didn't put out a press release on viewership for streaming, which was interesting. But the 8.5 million number last year, that is peak. That is not ama. So if you look at what fox did on tubi, I mean they doubled what took place last year. Just in terms of whatever the ama was on paramount, they definitely doubled it yeah so that's great.

Speaker 3 4:47

That's some, that's some good growth. Now, what was the viewership across youtube, tv, hulu plus, live tv, sling tv, direct tv, uh, fubo? I don't know, but what I can tell you is that if you add up the number of concurrent users that were on all those services at the same time, you're talking about approximately 15 to 17 million simultaneous streams were going on at that time. Now what percentage of those were watching the Super Bowl, I don't know. But even if you say it was half, you're still talking another seven to eight million concurrent viewers for the Super Bowl across virtual MVPDs. Now I know some people are going to ask Mark, where's Dan coming up with the 15 to 17 million number? Well, I'm not going to tell you I can't.

Speaker 1 5:47

But let's just say but it's an informed estimate.

Speaker 3 5:52

Yeah, the numbers come from somewhere.

Speaker 1 5:54

Yeah, they come from somewhere.

Speaker 3 5:56

So overall Super Bowl viewership for streaming grew a lot this year. Yeah, lot this year. Uh, as far as what I tested, I did the usual stuff Uh, you can see it all on the blog. I tested multiple Roku's, apple TV, fire TV sticks uh two. Samsung TVs, uh two LG TVs. Ipads, iphones Uh. Now I did a latency chart, which I don't know.

Speaker 3 6:19

Mark, I'm always surprised every year that people are just so excited by latency of the super bowl and the testing, and that's why I did it. Um, but you know, I think it's now. When did I put this up? I put that up during super bowl kickoff, so it's been five days later and just on linkedin alone it's at nearly 200 000 impressions, which is very nice of everybody. But but I just I don't really get why we're so focused on latency for the Superbowl. Every single argument, you see, is well, you know, it's all about betting. Well, you can't bet inside any of the apps ever in the last 14 years of the Superbowl. So I don't think it's that big of a deal. But Fox did a great job just in terms of they did some of the latency, especially on ios, on 5g.

Speaker 3 7:07

For me it was actually one, one to two seconds ahead, that's right stream amazing, uh, ios, uh, the 2b app on ios, uh, for wi-fi, was about one second behind on. On ipad it was two. On Fire TV it was three. On Apple TV it was six. So they did a great job of really keeping the latency low and there's some ways they did that.

Speaker 3 7:33

They're going to talk about the NAB Show Streaming Summit. So some of the Fox team is going to be coming to the show in April and they're going to be doing a 60-minute technical presentation on the workflow. That's awesome, yep, and how they built it out. They also built some unique QOE tools specifically for the Superbowl that they're going to talk to, I would expect, from a, from a high level, but very interesting. They're going to talk about, you know, mitigation the mitigating, the ways to mitigate failures.

Speaker 3 8:01

Basically, in some of the things that they saw, potential failures real and some of the things that they saw, potential failures real-time monitoring. They're going to talk about how they did some load testing, optimize the infrastructure, because they're using a lot of third parties. So if you're coming to the NEB Show Streaming Summit, definitely check that out. Now, a couple of things I would say that I would like to have seen a bit different on the Tubi side was the following. So first and I got this from a few friends who sent me screenshots of like hey, I can't find the game inside Tubi. Well, what they did is they download the app, create an account and they immediately went to live TV.

Speaker 1 8:42

Yeah because that would make sense, right.

Speaker 3 8:58

A normal consumer would make sense. They do this. Second, not every device was supported, and that's okay. But tubi works on playstation 5 and yet when people went to click on the super bowl stream, got a message saying sorry, your device is not supported. And that just was not the right message to give them, because then they were all, unfortunately, cursing to me on twitter of like, what do you mean?

Speaker 3 9:26

my device is not supported, I watch it all the time yeah well, it's just that the super bowl stream wasn't supported, yeah, and that was mostly because of latency issues on the ps5, so I would have liked to have seen a couple different things done with regarding the player. The other thing is, man, they took a lot of hits from folks who cared nothing about the Super Bowl, went to Tubi to watch their content but Tubi disabled search and they disabled their my Watch, which is where they stored what they wanted to watch or pick back up.

Speaker 3 10:03

And the message was like don't worry, this function will come back after the game People are like I don't care about the game. Yeah, and it's a fair question to ask why are you breaking normal functionality just for the Super?

Speaker 3 10:15

Bowl, when that's what I'm not interested in, so I get that as well. Also, for those that watch the stream, obviously you cannot pause the stream at all. We've seen that in other Super Bowl streams. Not all of them. Some have allowed that. And then also, just we have to remember how consumers think here. So, on Samsung TVs, tubi is supported on any Samsung TV from year 2018 and newer.

Speaker 3 10:43

But people were leaving comments saying, hey, what's the deal? Netflix works on my TV, but not Tubi? Well, Netflix works on Samsung TVs dating back to 2014, based on Netflix tech page that I looked up. So it's okay that streaming services are different, business models are different, regions are different. It's okay to support different devices based on what is the minimum threshold, but it was an interesting example of where consumers don't think about version of OS. On LG, you had to have at least five or higher of their OS, so people were leaving comments.

Speaker 3 11:23

So one of the things I was doing, mark, was I was replying to just regular users on Twitter when they were complaining, asking them hey, what are you running, what are you doing? And many of them were coming back with LG TVs that had OS of four. Well, to be said, you have to have at least five, but again, consumers are like they don't really understand. Understand that. So that was something that you can, no matter what streaming service you are. There's only a certain level of degree you could do in terms of educating users, but I would have liked to have seen a couple things done, definitely on the on the, on the player, a little more education for viewers of what was taking place, I would say. The one other thing that you know is something that we see anytime HDR is involved is that TVs are set to Dolby and not HDR10. So people were sending photos on Twitter of like why are my colors all washed out? Why does everything look weird? Now, the biggest problem there is Fire TV devices don't support auto switching.

Speaker 3 12:33

That's a problem, that's interesting.

Speaker 1 12:34

Yeah, that's a problem, because how in the world is a consumer going to know and then go find it in the setup menu? You know, find that and then go find it in the setup menu you know find that.

Speaker 3 12:52

So what I did like was Tubi's support. People on Twitter were replying and letting them know hey, here's the deal, you need to change dynamic range or color format from Dolby Vision to HDR. So they were great with replying and I replied to a bunch of people who were complaining about what they were seeing and it was pretty cool because in real time they were like oh, I did that, it worked great. So I like doing unofficial tech support, uh, during some of these live events, cause it shows me what real users are getting Um. So overall I think I think they did a great job.

Speaker 3 13:28

It was interesting just to see total capacity on the back end in terms of what they had. I can't give those numbers out, maybe they will during the presentation, but certainly the largest Super Bowl to date from a viewership standpoint. Also, from a quality standpoint, it was the highest pit rate ever, maxed out at 14.4 this year. Last year Paramount did 12. That was the highest rung in the bitrate ladder. A few other final pieces here. Fox did put out a press release saying between Fox and Tubi they generated over 800 million in gross revenue from advertising sales, but they did not break out the platform separately. Also, there were some folks who were sort of giving it to be on LinkedIn of like hey, listen, you guys didn't insert local ads. You could have made more money. In the 14 years of streaming the Superbowl. Nobody has done dynamic ad insertion.

Speaker 1 14:23

No.

Speaker 3 14:24

So, yeah, you know it's easy to be like, hey, you guys should have done this. Well, nobody else has done it to date either. Yeah, yeah.

Speaker 3 14:32

One news outlet said quote Tubi took a big risk in delivering the Super Bowl live in UHD, why Fox has already delivered it in 2021 and 2023 in upscaled 4k. Yeah, there was, there was no risk. So a little bit of that kind of nonsense after the Superbowl, but other all overall really good. And then just finally, as I put in my blog post, and on the latency side, and so far I've seen it represented very well when people are using the information. But keep in mind that I did say there's many variables that impact latency. So I talked about the device I was on, the model number, the OS I was running, what my connection was, who the ISP was. But my results don't necessarily mean that's the same results Mark's going to get or listeners are going to get.

Speaker 3 15:23

So it's important to remember protocols, packaging, technologies. A great example is why is Roku always one of the furthest behind with latency with devices? Because you have to use the native player. So there's differences when it comes to how the content is packaged and played back and the protocols used. So just a heads up. You know you read any of my stuff on latency. That's what I got. It doesn't mean what everybody got.

Speaker 1 15:52

Yeah, I noticed, dan. You know you had some people on LinkedIn even jumping in and giving you some latency measurements. You know, in other, I think even other countries, uh, or maybe I.

Speaker 3 16:06

I don't remember if they're other countries. Yeah, they were. The problem there is, you know, it's like, oh, I'm seeing latency of this and it's like, okay, I don't know what city you're in ISP device Exactly, exactly. What their own latency charts.

Speaker 2 16:25

It's like guys, listen, you don't have even in your chart what device you tested on, like telling me, fire tv is that a stick.

Speaker 1 16:30

Is that a fire tv built?

Speaker 3 16:30

into a tv model. What year is it like that stuff is important, yeah, and that's why I keep older models of roku's and in fire tv sticks, in particular apple tvs, too behind, because, like, I also want to test on a device that's five years old yeah so I think that's important and you've got to put that information out there.

Speaker 3 16:51

but uh, you know, overall it was good. What I want to know for the next super bowl, which is with nbc sports in 2026, is will that be free on peacockock or will that require a full Peacock account? You can't get a free account that day, don't know, but an interesting one to watch.

Speaker 2 17:14

So let's jump into.

Speaker 3 17:16

Speaking of Roku, let's jump into Roku earnings. So Roku had Q4 full year earnings. Their stock was up 10% after hours the day of earnings, which was yesterday. So they added 4.3 million active accounts and they ended the year with 89.8 million Total revenue 1.2 billion. They had a net loss of 35.5 million. For 2025, roku expects revenue of about $4.6 billion. What's interesting is $660 million of that will come from devices. So I think that's important, mark, because three, four, five years ago, a lot of people were like okay, roku's getting into the platform business. They are Soon, they'll get out of the device market. That's not going to make enough revenue anymore.

Speaker 1 18:07

Well, $660 million that's still a large 15%.

Speaker 3 18:13

The margins are lower we know that that's not surprising, but, you know, still interesting. Some other numbers from them. They are looking to be operating income positive for full year 2026. Now a little bad for us all is that, going forward, roku will no longer report quarterly updates on streaming household numbers, arpu, and they're just not going to focus on that anymore. It's going to be platform revenue, adjusted EBITDA, free cash flow and total streaming hours. So we are losing some data there, including ARPU. Arpu for all of 2024 was $41.49, trailing 12 months, and that was up 4%. Let's see a couple other numbers here. Roku said q4 was the highest quarter of premium subscription net ads since its launch in 2019. I don't know why that would be in q4 and I thought that was interesting. Yeah, because at the same time they told us that in Q1, they expect the vice revenue to be flat year over year due to quote elevated inventory from lower holiday sales. So you had lower holiday sales but you had the highest quarter ever of premium subscription net ads. Interesting.

Speaker 1 19:46

But the key is that's premium subscription net ads. So is that?

Speaker 3 19:54

existing subscribers who upgraded and they did that maybe because of some promotion or there was some hot content that was available motion, or there was some hot content that was available could be, but I'm thinking q4 across premium subscription, max hulu, whatnot that all of a sudden you're getting like what in q4 happened that would drive that, I don't know. Yeah, it wouldn't be super bowl, because it was to be christmas movies maybe maybe I don't know if somebody's watching those, not me.

Speaker 3 20:23

Yeah, exactly, they're popular. And then the final number here is for all of 2024, total streaming hours on Roku's platform was 127.1 billion, which was up 21.1 billion hours year over year. Wow, yeah, kind of a lot. Yeah, stock was doing well earlier today. Let's actually check it now, since the market's closed. So today they were up a little over 14%, so not bad. February 13th they were at a low of $81 and they hit just over $ over a hundred dollars today and closed store $99. So not bad. Past month, or up 32% past six months. They're up 76%. So Roku starting to get back up there, cause remember at one point they were like four, 40. Oh, yeah, they were, they were high, uh, uh.

Speaker 3 21:29

Moving on to amc networks. So amc networks, uh, let's see, in q4 they had 12.1 sorry, q4, they had 12.4 million subs across shutter, amc, plus acorn tv, the niche services they have. So 12.4 million. In q3 they're 11.8. So they saw a few hundred thousand, uh, but overall, uh revenue in the quarter was down 12 percent year over year. Advertising revenue was down 12 percent and what they called quote a challenging entertainment advertising marketplace. Now here's an important one, because we've already heard this from Comcast and others. Yeah, the company booked just under a $400 million charge last year, including $268.7 million goodwill impairment charge related to a decline in the value of its domestic cable networks. Another company writing down the value of its linear assets.

Speaker 1 22:33

Yeah, wow.

Speaker 3 22:35

Yeah, not surprising. Now. Previously AMC Networks said they would reach 20 to 25 million subscribers by 2025. But several quarters ago they sort of revised that number. So if you think they wanted to be 20 to 25 originally and they just hit a 12.4, you're off by a lot. That service just is not growing as they'd hoped for. Yeah, so that's, that's AMC.

Speaker 3 23:05

Let's jump into hot star and geo cinema. So hot star and geo cinema have officially now merged into what's called geo hot star. Um, geo star is the joint venture between reliance on via com 18 and star india. So they've now officially integrated the content into a revamped version of Disney's Hotstar platform. Disney owns, if I remember correctly, 37% of the combined company. The GeoCinema app will be phased out after, they say after existing customer subscriptions expire. So they're not killing the app overnight. The app did go. The merged app went live.

Speaker 3 23:48

Uh, today, friday february 14th. Um, it's got more than 100 tv channels. It's got hundreds of thousands of hours of local content. It also has tv shows from not just disney but wbd, hbo, mbcu, paramount. Uh, geo hot star says that they aim to reach more than 500 million users in the country. It's doable, maybe now as far as cost goes. Uh, subscription plans started. We're converting this to us dollars. Yeah, they start at one dollar and 71 cents for three months with ads. Uh, or three dollars and 45 cents per month for ad free ad free, the ad free. What's difference there besides the ads ads, is it allows a four screens at once simultaneous streaming. Uh, the dollar 71 cents only allows one simultaneous.

Speaker 3 24:40

And then the final piece of news here. It's being reported, but not confirmed, and I'd already previously heard this and I think I think a few people had already put this out uh that the basically going forward here is that the joint venture is no longer going to offer completely free streaming for ipo cricket matches and they're going to have a hybrid model, so you're going to be able to watch a certain amount of content and then, after that um, you're going to be able to watch a certain amount of content and then after that um, you're going to have to have a subscription and there's some sort of threshold of I don't know if that's number of hours, how that works, but there'll be a threshold of like, hey, you got to see this for a while. Now you need a subscription, and this is the same If you watch actually if you go watch CNN on your desktop it'll tell you you have a free preview for what is it now?

Speaker 3 25:30

20 minutes maybe.

Speaker 1 25:31

I forget. And then after that it's like either buy or authenticate. Yeah, exactly, yeah, that's interesting.

Speaker 3 25:39

Yeah, and considering the volume of users they have and viewers, yeah, and we know people love cricket yes, the highest audience out there today and and cricket games are long. Yes, you can go all day right I mean, I think they're like, no, I think, eight hours days yeah, but I mean yeah, it's the viewing times match.

Speaker 3 26:03

Yeah, it's long. A couple details here on Philo their subscriber base has climbed to 1.3 million, so they added about 300,000 subscribers in 2024. They did encounter a price increase last year. The base package is $28 a month. This was interesting, mark. I saw MLB announced their MLBtv service for 2025 and they said, oh, by the way, it's the same price as last year. But then there was this little text that said they will stream select games in 1080p. Yeah, and I was like, wait, games weren't in 1080p yeah, so I reached out to them and they nicely replied and said it's primarily been in 720p to date.

Speaker 3 26:47

Yeah, and the way this is going to work is what I asked. What does select games mean? So they did experiment in previously with 1080p, but almost everything was 720. So what they said was, starting off, select games will be 1080p, but it will roll out to all games over time. Got it? So that's good, better quality coming and MLB TV's price is the exact same as last year. Let's go into Apple.

Speaker 3 27:15

The Apple TV app is now available on Android tablets in the Google Play Store. As of yesterday. It was not yet available for Android phones, but it's coming. It's rolling out for it. You got to be Android 10 or newer. Now, a couple of things here that are important. The app is limited in content and functionality. You can't do casting. The content in the app is only in Apple TV+. It's MLS Season Pass and MLB Friday Night Baseball. The Android app doesn't support notifications. The iTunes Store purchases and rentals are not shown in the app and you cannot access the previously purchased library. So it's called a light version, a slimmed down version, whatever terminology you want, but you have android users android 10 or higher who can now get access to MLS Season Pass and Friday Night.

Speaker 2 28:07

Baseball.

Speaker 3 28:07

Yeah, not surprising that was coming. Let's jump into cord cutting Altice. They lost 64,300 residential pay TV subscribers in Q4, and they lost 291,000, just under 292,000 for all of 2024. Thousand just under 292 000 for all of 2024. So altice ended the year with 1.88 million residential pay tv video subscribers. And yet during the call, they're like video is really still a strategic, important part of our business and they're like here's how we're going to do it. We're going to lower our cost and really it was just like we'll lower programming costs and we'll charge more.

Speaker 3 28:47

Yeah, charge more, and I was like, yeah, that's, that's not really strategic, by the way. So at what point do they and Verizon with Fios just stop.

Speaker 1 28:56

Exactly, I was thinking this is mirroring Fios, yeah.

Speaker 3 28:59

Right, I mean, isn't Fios also? Around similar, like they just have a couple, I think they're just under 2 million now.

Speaker 1 29:05

Yeah, yeah, it's very close.

Speaker 3 29:07

So Wow, yeah, I kind of I kind of don't get that. If you're losing 300, call it 300,000 subscribers a year, yeah, right, another three years you're at under a million subs. If you continue that trend, yeah, so just at some point we're going to see that change. Interesting too, that they had broadband net losses of $39,000 in the quarter and $170,000 for the year. Q4 revenue of the company was $2.2 billion, which is down 2%, and let's see full year revenue of $9 billion, which was down 3.1%. So more cord cutting. Let's go to Harmonic. Harmonic Q4 revenue was 222 million. It was up 33%. Harmonic had good gap net income of 38.1 million. Their broadband revenue is 171 million, so that's up from 115 year over year. Their video segment was flat revenue wise at 51.1 million, so that's up from 115 year over year. Their video segment was flat revenue-wise at 51.1 million. But they're in good shape financially. They ended the year with 101.5 million in cash. They also announced a new 200 million three-year share repurchase program.

Speaker 1 30:22

Mm-hmm.

Speaker 3 30:23

In Q4, Comcast represented 43 percent of total revenue and charter represented 24 percent boy, that's I.

Speaker 1 30:32

I was, I, I guess I knew that, or I certainly knew that those two was high customer. Yeah, but right boy, when you look at that number you realize holy cow 67 percent yeah yeah, two-thirds of your entire business. That's a problem.

Speaker 3 30:50

But you know they have good money. You know they had good cabinet income. On the liquidity front, they also announced that they increased their current credit facility by 40 million to 200 million, so includes $160 million revolving credit line and also $40 million delay draw term loan. So they've got plenty of money. They've got a good balance sheet. Their cash and cash equivalent at the end of 2023 was just over 84 million. Well, they ended this year with just over 101.

Speaker 1 31:21

Yeah, so they're growing cash on the balance sheet, which is great, Growing off cash. That's important.

Speaker 3 31:26

Yeah, Now is the video segment revenue flat yes, but we knew that.

Speaker 1 31:30

Yeah, exactly.

Speaker 3 31:32

So overall, good. However, the stock got absolutely hammered and we'll look it up now. The market closed, so let's pick back up. So you know they reported. When they reported earnings, they were $10 and 20. Oh sorry, they were $10 and 6 cents. No, let me. Let me start all over there. When they reported earnings, they were $11 and 12 cents. After earnings, they dropped to $7 and 50 cents. Wow, but they made up almost all of that and they closed today at $10.06.

Speaker 1 32:08

Okay, there you go.

Speaker 3 32:10

So, you know, I think, initial shock maybe just in terms of Wall Street looking at the video business, but they sure do know that that's flat. So who knows? But they've made a lot of that up.

Speaker 1 32:24

What do you make, dan, of this Akamai tie-up? They also announced that they are powering Harmonica's powering the Akamai Media Services Live 5.

Speaker 3 32:37

Yeah, I don't make anything of it, because Akamai also partnered with Bitmovin and Akamai also partnered with just about every vendor out there. So if you're a vendor and you're looking for CDN to do stuff at the edge, and okay, you're going to partner, and Akamai also partnered with just about every vendor out there. So if you're a vendor and you're looking for a CDN to do stuff at the edge, and okay, you're going to partner with Akamai. That's not really surprising at all. But they have a lot of Akamai has a lot of partners for media services. So if Harmonic were to say and as a result of that, we expect X percentage or millions of dollars in revenue, that's a then I'd look at it differently.

Speaker 1 33:15

But just a vendor-to-vendor partnership tie-up without numbers. We really don't know what that means. Yeah, what's a little bit interesting is there was I media coverage. The word exclusive was used um to power that harmonix vos 360 media sas will power the upcoming. So not you know. I guess you know at least generally available, uh, upcoming akamai media services 5. And it implied that this is the encoder that's running behind the scenes. Yeah it could be.

Speaker 3 33:56

I don't know, because there was a separate press release talking about how their harmonics video streaming solution is now qualified and I saw that language. You know their their harmonics video streaming solutions now qualified.

Speaker 1 34:06

And, and I saw that language yeah, right, and that's that's different wording there, so I don't know.

Speaker 3 34:12

but the bottom line is what do we care about? We care about our customers buying this as a driving revenues and solving problems on the market. That's right. At some point hopefully harmonic talks to that yeah, a couple more things here tomorrow. It's going to Fastly, so Fastly. Had Q4 2024 earnings. Let's pull up their stock here. So they got hammered.

Speaker 1 34:38

Yes, they did, they were down 20% after hours.

Speaker 3 34:42

So Q4 revenue is 140.6 million. It was up 2% year over year. Gap operating loss of 34.3 million. So full year 2024 revenue was 543.6 million, which is up 7% year over year, but operating loss for Fastly gap operating loss was 167.9 million for the year. What do we know about infrastructure services? There's a lot of CapEx. Yeah, that's right, it's reality. Now their network services revenue is $110.1 million was flat year over year. No surprise. We see what's going on in CDN. Security revenue is up 4%. Fastly's top 10 customers accounted for 32% of revenue in Q4 compared to 40% in Q4 of 2023. Now this number not great Revenue from the top 10 customers declined 18% year over year, Whereas revenue growth of 16% was seen year over year from customers outside the top 10. Well, their top 10 customers are some of the largest media customers around and we know what's going on with streaming and lower bid rates and optimizing and coding, and so you're going to get less bids.

Speaker 3 35:58

We already know that, so not too surprising. There Was good to see that they refinanced a portion of its outstanding convertible debt. Um, it was good to see that they refinanced a portion of his outstanding convertible debt, so they raised 150 million um of 7.75 convertible senior notes with a hundred percent conversion premium due 2028. So what are they doing here? They're pushing out the money they owe Intel. Yeah, three more years, so that's certainly good. They also repurchased 158 million in principal amount of its existing 0% convertible notes. Those were due in 2026. And they said they paid approximately 95% on the dollar. So not surprising. Remember, a couple of quarters ago we saw Fubo do this.

Speaker 2 36:43

Yeah, that's right, they're dead out.

Speaker 3 36:45

They're smart. Fastly ended 2024 with $286.1 million in cash and cash equivalents. I did see a few people leaving comments online about Fastly can't make it. I don't know what they're talking about. Yeah, they have the cash, right I?

Speaker 2 37:02

saw that too.

Speaker 3 37:03

That's not going to be an issue if they continue to lower their gap operating loss, which they have done in the last couple of quarters, they've got $286 million in cash in the bank. You're okay. Now the real question and it's a fair question is the vast majority of your revenue is coming from network services when you're fastly, not security. So how quickly can you grow overall business? Well, total revenue is up 7% year over year. Wall Street wants to see it seems like. Overall with infrastructure they want to see at least 10. Obviously, depends who you ask. Last one here, mark.

Speaker 3 37:43

So last week, bending Spoons, they held an all-hands meeting with Brightcove employees. Since the deal is now done, they announced change is coming. Brightcove CEO, coo and CPO are leaving. Their chief revenue officer is staying. All departments at Brightcove will see layoffs. Sales is going to be the least impacted initially. People are getting a one to two month evaluation period on all sales personnel. Some Brightcove employees that already been let go During the all hands. Bending Spoons did not announce the number of layoffs no exact number. I expect it to obviously be in the hundreds because at the end of Q3 of last year Brightcove had 621 employees that they reported and in 2024, bending Spoons CEO said in an interview that Bending Spoons had between 300 to 400 employees. Yeah, so it's coming. There's going to be layoffs. Bending Spoons declined to comment for the story. I got no information from them of any kind. They wanted to make no comments. Give any details.

Speaker 1 38:47

Hey, that's the right to do that.

Speaker 3 38:48

Yeah, of course.

Speaker 3 38:49

I do think you can message that a little bit better. You know you have a lot of people then who work there just putting things up on LinkedIn and whatnot. Okay, why not just come out and say here's what we're going to do? Yeah, right, why let people speculate? Yeah, uh, but that's, that's the reality of it. That's what happens when companies get acquired or merged. I don't think anybody's shocked here. What I would really like Bending Spoons to come out and say is what does the product portfolio look like going forward? Yeah, yeah, what are you doing with Brightcove?

Speaker 1 39:20

Yeah, what are you doing with Brightcove? What are you doing with Zencoder? Exactly Now, what are you?

Speaker 3 39:23

doing with BrightCode? What are you doing with Zencoder Exactly Now? Maybe they're like hey, we have that figured out, but we don't want to talk about it for another six months. Okay cool.

Speaker 3 39:30

Again, that's your right to do that, but hopefully they put out some information sooner rather than later. Yeah, and then just a quick update, mark, on the NEB Show Streaming Summit, as I mentioned. So we'll have the fox team there. We've got youtube tv doing a technical presentation, uh, so this is pretty cool too. I think this is new and I didn't announce this last week, but we see a lot going on with tv os. Well, the trade desk is going to come and do a fireside chat with me. Oh, cool, with their sv who's running their Ventura TV operating system.

Speaker 1 40:06

Yeah.

Speaker 3 40:07

So super interesting to hear more about that. They'll also, I'm sure, have more news leading up to NAB as well. So that's a new fireside chat there I'm excited for Really want to see what they're talking about in terms of what they're doing to empower advertisers and those premium content publishers. So we've got that. That's been new. That's added.

Speaker 3 40:28

I've got a great session here on live sports streaming workflows. Got all the major sports folks who are streaming stuff coming for for that session as well. I'm doing a current state of CDM market with with all CDN customers, all large ones, anywhere, knows by name market with all CDN customers, all large ones, anywhere, nose by name. We've got sessions around how you architect for scaling services. I've got things around packaging, distribution, monetization. I've got things around front-end player and UI, ux, business models tied to today what is fast AVOD, svod, a combination of them, virtual mvpds like the way we consume content so many options, yeah, so we've got a great session on that. Uh, we've got a lot of really good content in the hopper.

Speaker 3 41:19

So, uh, friday, february 14th, today, maybe by the time you're listening to this, I'll already have content up In the next 24 hours. I'm starting to put up speakers, keynotes, fireside chats. All online, go to nabstreamingsummitcom. But program's moving forward really, really well. Now More sponsors in for the happy Sunday, april 6th. I already had some folks reach out for that, but the whole goal of that is just to bring together some of the largest content owners who are in the industry, who are using third-party CDNs and also those who are building their own third-party or first-party CDNs or DIY. So it's going to be a great meetup. We're going to have folks from YouTube, sky, nbcuniversal, disney, netflix, paramount, prime Video, fox, wbd just a great lineup of content owners all talking, infrastructure and just a beer networking 90 minutes but it's only open to content owners, broadcasters, ott platforms and also last mile providers.

Speaker 3 42:37

So if you want more information on that, shoot me an email, dan at danrayburncom, or connect with me on LinkedIn. I'll give you some more details, as long as you fit that criteria. That's the requirement. No vendors, no vendors, because one of the things that content owners want is they want to be able to talk to one another without getting a pitch. No one's sneaking in because I'm going to be working the door, so I'm going to be checking everybody's personally.

Speaker 3 43:01

Yeah, I will be there. You can't bribe your way in, but I'm excited for that since I spend so much time with those guys already as it is. So that's what we got this week. Appreciate everyone listening. We've got just a few more earnings the rest of this month. Next week we've got Akamai and Vimeo and then the week after that, last week of the month, is pretty big because we have Paramount, wbd and Fubo, so three big ones there to cover.

Speaker 3 43:28

Mark and I will be back next week. Then we're taking a week off or we'll just schedule here for some travel. Yeah, but if there's anything more you guys want to hear from, reach out, let us know. We appreciate everyone listening. Any questions, reach out to us anytime. Hopefully everyone's sort of calming down now after the Superbowl and everything else going on. It's been a busy week, I know, for a lot of companies support the Superbowl. The list of vendors that support the Superbowl is incredible. Um, mark, just when I was at Fox's facility in Tempe last year, just in their mini data center there, just the number of vendor logos I saw on hardware alone, yeah, and then all the software, and then think of all the folks on the capture side and cameras and trucks and IP transport and I bet you it's in easily over a hundred vendors yeah, easily.

Speaker 3 44:18

So a lot of good work done by a lot of companies and people because, all in all, everything kicked off really well for the Super.

Speaker 1 44:25

Bowl yeah, it did, it did, and you know it did, it did, and you know it's interesting, dan. So you had Netflix from the Thanksgiving challenges and then Christmas basically went off relatively hitchless, and now you've got the Super Bowl.

Speaker 3 44:49

I wonder if we're starting to see a very positive trend here, possibly but most super bowls historically have been pretty, pretty good well, that's a good few things here and there yeah, paramount had a little issue with a vendor last year, right, that was corrected pretty fast. But, yeah, I I think without the, the netflix boxing thing, right, that sort of just shined a spotlight, yeah, on a lot of things. If you strip that event out with any issues, the conversation certainly would have changed. And of course, how many members of the media who don't even cover our industry in any way, shape or form, picked up just the netflix tyson?

Speaker 2 45:21

also it's tyson, so that added it was tyson yeah exactly.

Speaker 3 45:26

Well, what do we have coming up? We've got some stuff. Later in the year, obviously football again. We'll have some exclusive playoff games I forget when FIFA is, or World Cup, but that'll be coming. You got the Olympics next year in winter in Milan, so it never ends. There's something else coming up at some point but yeah, it was great to see just all the different folks involved in the Super Bowl. So good job overall, yeah for sure, thanks everyone for listening.

Speaker 3 45:49

Everyone stay safe. Have a good week. Have any questions, reach out to us at any time. Thanks very much.

Speaker 2 45:56

If you enjoyed the show, send it to a friend, have questions for Dan or Mark, connect with them on LinkedIn at any time, and be sure to check out Dan's blog at streamingmediablogcom.