Netflix bummer:
Down 800K subscribers
Other shorts: Study: TV ad spending rises
By Louisa Ada Seltzer
Oct 25, 2011
Netflix bummer: Down 800K subscribers
The fallout from the Netflix price hike was evident yesterday, when the online rental service said it lost 800,000 customers during third quarter, blaming the decline on the decision to raise the price on DVD and online streaming services over the summer that resulted in a public relations nightmare. That was 200,000 more than Netflix had anticipated losing. Further, Netflix predicted that it will lose another 2.6 million DVD-only accounts during fourth quarter, following a quickly squelched plan to spin off its DVD rental service into a new company called Qwikster. "Our primary issue is many of our long-term members felt shocked by the pricing changes, and more of them have expressed that by cancelling Netflix than we expected," wrote Netflix chief executive officer Reed Hastings and chief financial officer David Wells in a letter sent to shareholders. The big question, of course, is whether any of those disgruntled customers will return. There are a number of services that have arisen to compete with Netflix, including Hulu Plus, Amazon Prime and the revamped Blockbuster online rental service, along with Red Box.
Study: TV ad spending stays on rise
Nearly half of advertisers have increased TV ad spending in the past two years, though marketers have some concerns about the effectiveness of the medium. Forty-seven percent of marketers increased TV ad budgets since 2009, according to a survey by the Association of National Advertisers, while 30 percent said budgets remained the same and 23 percent said budgets decreased. The survey found that 64 percent of business-to-consumer marketers reported increased budgets in the past two years, versus just 27 percent among business-to-business advertisers. Similarly, 36 percent of B-to-C advertisers said TV has become more important to their overall strategy in the past two years, compared to just 13 percent of B-to-B advertisers who said the same. But while TV remains the top platform for advertisers, the medium isn't without its troubles. Fifty-seven percent of respondents said they worried about fractured attention due to other options including computers and cell phones, while 56 percent are concerned about commercial avoidance through DVR use.
Hinton: I didn't know about NOTW hacking
News International executives continue to insist that they knew nothing about the phone hacking scandal that brought down the News of the World until after the fact, despite others' insistence to the contrary. Yesterday Les Hinton, the former Wall Street Journal publisher who headed News International from 1995 to 2007, testified in front of a parliamentary committee investigating the scandal, and he emphasized that he had no clue that hacking was widespread at NOTW. Hinton stuck to the News International refrain that executives believed hacking was limited to one rogue reporter, Clive Goodman, who served jail time in 2007 after being busted for phone hacking. Hinton also dismissed the infamous letter sent to him by Goodman claiming that many more reporters had participated in hacking as "accusations and allegations" that were not evidence of anything. Hinton was criticized by several members of Parliament for his foggy memory and insistence that he was not told about certain seemingly crucial developments in the scandal. And his testimony still did not clear up whether James Murdoch, son of News Corp. CEO Rupert, actually knew about the scandal before this summer. Yesterday James was officially called to testify next month in front of Parliament, his second appearance.
Less-than-commanding premiere for 'Boss'
Perhaps it's a good thing for Kelsey Grammer that Starz ordered a second season of his new drama "Boss" before the show even debuted because its ratings aren't all that great. The series premiere of "Boss" averaged a so-so 659,000 viewers in its 10 p.m. timeslot last Friday, according to the network, while back-to-back airings of the premiere combined to average 1.05 million. That's down 30 percent from the 1.51 million viewers back-to-back airings of the premiere of "Torchwood" averaged on the network back in July, and also down 33 percent from the 1.57 million the now-canceled "Camelot" averaged on its premiere night in February. Including other encore airings, "Boss" averaged 1.72 million total viewers throughout the weekend, 39 percent lower than Starz' record-setting "Spartacus: Gods of the Arena" averaged over its opening weekend last January. Starz is holding out hope for "Boss," however, saying its viewership numbers will be supplemented significantly once online sampling and on-demand numbers are factored in. Grammer plays Chicago mayor Tom Kane, who has a degenerative neurological disease that he is hiding. Last month Starz ordered a second season of the drama.
Lohan: From child actress to Playboy centerfold
This kinda seemed inevitable, didn't it? Child actress-turned-train wreck Lindsay Lohan has agreed to pose nude for Playboy magazine, according to TMZ, and shooting for her pictorial reportedly began this past weekend. Playboy had been trying to convince Lohan to pose for months, initially offering her $750,000 to appear in its pages. The actress came back with a $1 million counteroffer, but TMZ says the two sides settled on an amount between those two figures. If Lohan did indeed take part in a photo shoot, it must have made for a busy weekend. On Friday she spent eight hours doing cleaning work at the Los Angeles county morgue as part of her court-ordered community service. There's no word yet on which issue of Playboy Lohan will be featured in.
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