CES 2018: Day 2 Recap

Insights from keynotes on 5G and content industry, plus news round-up

Welcome back to our continued coverage of CES 2018, the biggest consumer tech show on the planet. Unlike the yesterday’s rainy gloom, it was a bright day in Vegas today…until the power went out for over an hour in the convention center. But, the show must go on, and so it did.

The Lab continued to walk the show floor with our clients and attend keynote sessions. In the morning, executives from Qualcomm, Baidu, and Verizon came together for a panel discussion on the innovations that 5G connectivity will unleash on mobile devices and beyond. The three companies are tackling the questions surround 5G from their own unique angle, and you can read the recap of that discussion here.

Hulu and Turner Discuss Three Top Challenges The Content Industry Faces

In the afternoon, Randy Freer, CEO of Hulu, and John Martin, Chairman and CEO of Turner Broadcasting, took the keynote stage for an insightful conversation on the changing dynamics of the content industry and how the TV media owners are responding to the disruptive forces. Together they brought up three unique challenges that the content industry is facing right now, as they compete not just with each other, but also against the likes of Facebook and Amazon for the most precious commodity — consumer attention.

First up, Freer raised the importance of digital distribution for today’s content industry. In this day and age, “every company needs to be great at the tech it takes to distribute your product,” he summarized, and unfortunately not every content player has been up to that task. As viewers continue to shift away from linear TV and towards on-demand OTT viewing, it is crucial that media owners step their game up and build out their digital channels and technological support that goes with it in order to ensure it delivers a smooth and optimized viewer experience, which has traditionally been a strong suit for the tech giants moving into the video space. At the end of the day, creating a differentiated experience and engaging customers is key to success in the future of television, and content distribution makes up for a big part of that experience.

Distribution also matters in terms of how content owners can connect with audiences on a global scale. With the Disney-Fox merger pending regulatory approval, Disney may end up with a strong global reach and a vast differentiated content, which gives Hulu (which Disney will hold the majority shares of) a good opportunity to ditch its regional approach and better take on Netflix. Martin thinks that it is important that content owners be proactive and build out their digital channels to ensure global reach. Martin echoed Freer’s sentiment, adding that “soon only a few premium content creators will be able to compete on a global stage.” It’s a industry shakeup that will leave the smaller players unable to compete due to the lack of scale needed to power content production and funding, he commented.

Secondly, Martin noted the challenges of engaging with fandoms in order to tap into the grassroots marketing power they generate. He cited a study that found 9 in 10 American consumers consider themselves to a fan of something, and pointed out that it is crucial to “attach yourself to those fandoms and keep providing them with the content they like to engage with.” For Turner, the main challenge here lies with attribution and for Hulu, with creating more engaging content. Cultivating a fandom is of paramount value for any brand, but especially so for content owners as everyone has their favorite movies and TV shows. The media industry needs to do a better job at identifying and activating the fans and bringing them into the conversation as ambassadors.

Last but not least, the two CEOs discussed the challenges of keeping up with the ad-free competitors like Netflix and Amazon. Martin acknowledged that the commercial-free viewing experience is a nicer one, and that it’s the consumer experience is what ultimately dictates where they spend their time. This is why three Turner channels — TNT, TBS, and TruTV — are now experimenting with reduced ad loads and have seen positive feedback. Freer, however, is quick to note that consumers do understand the value proposition of ad-supported channels, citing the fact that many still choose to sign up for the Hulu subscription tier with limited ads instead of the ad-free one.

The discussion ended on a positive note, as both executives noted that despite the fragmentation of the content market, video consumption is higher than ever, Therefore, it is up to the content owners to keep innovating their distribution channels and improving the consumer experience they deliver in order to stay competitive.

Day 2 News Round-up

With an added layer of software and sensors, connected lights are becoming a more integrated part of the smart home experience, smartly responding to different contextual cues to create the perfect ambience for the moment.

• Philips is partnering with other companies and software developers to synchronize Hue lights with games and content to create the perfect ambient for your gameplay and viewing experience. One such partner is gaming company Razer, which Philips is working together with to sync up Hue lighting effects with compatible games like Overwatch to help players focus. In addition, Philips also teased a line of outdoor Hue products that will be released this summer.
• Nanoleaf unveiled its upgraded smart light panels, adding touch and motion sensors to make them respond to gestures or simply people walking by. Like Philips, Nancleaf also plans to open up the software for it to outside developers, allowing them to create third-party apps capable of simulating more on those panels.

Google is still trying its best to steal the show from Alexa. How much of this strong marketing push and third-party integration will translate into market share for the Google Home or Google Assistant is still very much uncertain.

• Dish announced voice control integration with Google Home and Google Assistant, joining a growing list of device-makers that joined Google’s camp as the voice platform war start to heat up. Beyond smart speakers, this CES shows that smart TV will be the next battleground for voice assistants to duke it out in order to gain a foothold in the future of smart home.
• Google partners with hardware makers including Sony, Lenovo, and LG to introduce a new Smart Display platform that adds screens to smart speakers. While this is not the most original idea, as the result is pretty much just Google’s version of Echo Show, it does recontextualize Google’s decision to pull YouTube integration from Echo Show in early December.

As CES enters Day 3 tomorrow, the Lab will turn our focus to putting together a CES trend report for you while also keeping an eye out for any late announcement that may be of relevance. As always, follow us on Twitter and Instagram for the latest updates, and check here for all of our CES coverage so far.