‘House of Cards’ Stacked Deck for Netflix

Frank Underwood was probably right when he said, “There’s no better way to overpower a trickle of doubt than with a flood of naked truth.”  The maniacal politician played by Kevin Spacey in Netflix’s original hit series “House of Cards” continues to excite fans and gain industry recognition for a second straight season.

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Netflix made history last year when it became the first non-TV network to win an Emmy, three actually, with one going to David Fincher for best directing for the political drama series.  The online video streaming company received 31 Emmy nominations this year, including 13 going to “House of Cards” and 12 for season one of “Orange is the New Black.”

What makes Netflix different than traditional award-winning networks such as HBO is that the full seasons of its original series shows are released at once, delighting binge watchers everywhere.  Season two of “Orange is the New Black” already is online.  So please, no spoiler alerts.

No doubt the strategy is working.  Netflix (NFLX) stock and subscriber base are at all time highs.  With good expected 2Q 2014 earnings to be announced on Monday, the company continues to invest in production and international expansion.

Pumping out consistent hits is not easy, however, no matter how much money is thrown at development.  It’s also easy to assume this is even more crucial for Netflix because of its decision to unload all of its series content at once.

But Netflix is changing the way people watch television, giving viewers the opportunity to stream content when and where they want.  It’s this competitive edge that truly separates Netflix from traditional broadcasters, where weekly episodes keep viewers tuning in to see what’s next.

That’s great news for advertisers, but Netfliix is about subscribers.  While the company’s decision to release all of its original series content in one swoop is great marketing, it’s really nothing new for Netflix.

All of its content is always available, whether it is a multi-episode documentary or a full season of the latest hit TV series. Original content released weekly doesn’t make much difference for Netflix.  The new content, however, and the awards it receives, generates media coverage and builds brand awareness for Netflix, which ultimately brings in more subscribes.

While we may never know exactly how many subscribers watch its shows like “House of Cards” and “Orange is the New Black,” Netflix currently is firing on all cylinders, at least until the Internet goes down and customers cancel their subscriptions.

Right now, all eyes will be watching on August 25 during the 66th Annual Emmy Awards when Netflix may continue to make Internet-TV history.

Reader Beware: More Online News Stories Dubbed as Ads

The line between editorial and advertising has become increasingly blurred, as sorely needed revenues are forcing struggling news organizations to find new money streams.

For online news outlets, native advertising is emerging as a solution in today’s Internet-based media landscape. These sponsored ads, otherwise known as advertorials, are written as news stories, favorably positioning the advertiser.

 Sponsored content in 2013 from The Atlantic posting an ad for the Church of Scientology.


Sponsored content in 2013 from The Atlantic posting an ad for the Church of Scientology.

According to the Pew Research Center’s State of the Media 2014, the number of these types of ads will increase this year, as prestigious new organizations like the New York Times, Washington Post and Wall Street Journal, and others, have at least begun the process to implement sponsored content, which is expected to generate $2.29 billion in 2014, says eMarketer.

More of these “ads” are popping up in financial broadcast outlets since the SEC last year lifted its ban on alternative investment vehicles advertising to the general public as amendments to Rule 506 of Regulation D mandated by the JOBS Act.

Facebook has mastered the art of sponsored content with its “suggested posts” that pop up in news feeds.  These posts are meant to look and feel like generic updates from friends and not by advertisers because the ad content is selected based on user preferences. For example, if a person likes car racing, he or she may receive posts pertaining to an automotive manufacturer or retailer.

The concept is not new.  For years, advertorials appeared in news magazines and newspapers with the corresponding phrase, “special advertising supplement,” alerting readers that the content is an advertisement, although sometimes the ads slip by as editorial content.

The proverbial jury is still out, however. While many publishers have expressed concern over using sponsored content, including the Wall Street Journal’s Chief Editor Gerard Baker calling it a “Faustian pact,” the reality is that sponsored advertising is a necessary evil and a good solution for today’s media outlets, even though it may come disguised as an unbiased news story.

LA’s Mayor Goes From Crude to Rude All in One Day

Millions of Americans last Monday night got to hear New York City Mayor Bill de Blasio sing “I Love L.A.” during “Jimmy Kimmel Live” after losing a friendly wager with Los Angeles Mayor Eric Garcetti.

The LA Kings decidedly beat the NY Rangers during the 2014 Stanley Cup Finals, clinching the title in dramatic fashion by winning game four at home in a double overtime 3-2 thriller, forcing the Big Apple mayor to pay up.

Viewers listened uncomfortably to the New York mayor wearing an “I (heart) LA” t-shirt try to carry a tune, as members of New York City’s 52nd Street Project student chorus, also wearing the same shirts, sang along making the performance a great success.

Aside from his awkwardness as a singer and performer, de Blasio was gracious throughout the entire skit, even after Garcetti’s comment about Gray’s Papaya franks tasting “like a steaming bag of New York garbage” compared to Los Angeles favorite Pink’s Hot Dogs.

It’s unclear why the first-term mayor would make such a rude comment, even prompting Kimmel to “take issue” with the remark as the late night host chomped on a Gray’s Papaya hot dog given out to audience members courtesy of NYC’s Mayor de Blasio.

But this is only half the story.  Earlier that day, Garcetti blurted out an f-bomb during a televised LA Kings celebration rally.  Many of the players were advised in advance not to use profanity, especially since many youngsters would be in attendance.

Apparently, the mayor’s crude outburst was planned because he began his remarks by saying two things elected officials should never do, “never take a photo with a drink in your hand and never curse.”  That’s when he said, “But this is a big f—— deal.”

While there are worse offenses committed by elected officials over the years, cursing ranks pretty low on the spectrum.  But the mayor is representative of the people who elected him, and not all Los Angelinos need to use profanity to express excitement and elation.

Whatever Garcetti’s future political aspirations, hopefully it’s filled with motives of alliance building and no curse words.  A good place to start can be at the 82nd annual U.S. Conference of Mayors.  Either way, while crude and rude comments may make headlines, they’re not the type of press coverage for building a sustainable brand in the public’s eye.

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The Good and Bad of Phil Mickelson’s Insider Trading Scandal 

Phil MickelsonPhil Mickelson’s squeaky clean image has come under scrutiny as the golf hall of famer is confronted with accusations of insider trading that may jeopardize lucrative endorsement deals that earn him nearly $30 million annually.

The four-time major champion along with Las Vegas gambler William T. Walters have been named in an F.B.I. investigation citing the two may have acted on information given to them by activist investor Carl Icahn about his planned takeover bid of Clorox in 2011.

Needless to say, Icahn’s takeover bid failed, but both Mickelson and Walters apparently traded Clorox shares during the time of the takeover attempt.  Whether or not Icahn breached any fiduciary duty to his own investors remains unclear, published reports indicate that Mickelson and Walters appear to have done nothing illegal. 

Any publicity is never good publicity. Look at what scandals did to Tiger Woods and celebrity chef Paula Deen, although both seem to be on the turnaround.  Marital troubles and a racist remark that may have been taken out of context created a firestorm of bad press that sent sponsors fleeing.

While Mickelson and Walters deny any wrongdoing, just the association linked to a scandal can raise an eyebrow or two.  For the pro golfer, however, a sign of humanity pitted against a near perfect perception actually may not be a bad thing after all.

Consider the fact that most Americans love a comeback, especially someone they can identify with whom may have gone through some kind of misfortune.  Even voters have changed their image of the perfect candidate, finally realizing politicians are just imperfect human beings.

A journey through the proverbial abyss not only builds character, but makes for a slightly better story.  And for Mickelson, that could mean even more sponsorship deals.

IndyCar to Drive Fan Interest

Sunday marked the 98th running of the Indianapolis 500, an event billed as the “greatest spectacle in racing.”  One can only truly experience the magnificence of this historical event if lucky enough to be present at Indianapolis Motor Speedway (IMS) during Memorial Day weekend.

KVSH Racing's Sebastien Bourdais at the 2014 Indy 500.

KVSH Racing’s Sebastien Bourdais at the 2014 Indy 500.

Close to 300,000 people attend the annual race, which originally began in 1911 on a track of 3.2 million bricks.  A yard-wide strip of these bricks still remain across the width of the asphalt track.  It has become customary for the winning driver to kiss the “yard of bricks” after the race.

Ryan Hunter-Reay got to kiss those bricks as he became the 2014 Indy 500 champion, winning in dramatic fashion, holding off three-time Indy 500 winner Helio Castroneves by .0600 of a second, one of the closest margins of victory in IndyCar history.

As exciting as the race was, IndyCar Series, the premier level of American open wheel racing, is struggling to capture viewers.  The Series saw its viewership drop 22 percent last year for 19 race telecasts across ABC and NBCSN, compared to 15 telecasts in the prior season, averaging 953,000 viewers, down from 1.2 million viewers in 2012.

Much of the downturn has been a result of the infighting between IndyCar Series and Champ Car World Series (formerly CART).  The two finally merged in 2008, but left a trail of discontented fans fueled by top drivers leaving the series for Formula One and NASCAR.

There is some good news.  Ratings are up, a little.  This year’s Indy 500 scored a TV rating of 4.0, compared to a 3.7 score in 2013.  The added races in 2013 also led to increased total reach for the race series. Still, attracting eyeballs continues to be a challenge for IndyCar Series organizers, not to mention getting fans in the seats.

While attendance at the Indy 500 remains a contested debate among race fans, industry insiders are positive about IndyCar’s future, saying the series is “rising,” and that they are confident it will make its way back to the glory days of the 70s, 80s and 90s.

Hunter-Reay’s win is a good start.  He’s the first American to win the Indy 500 in almost a decade, being quoted after the race promoting the series saying, “This (race) is American history. It’s where drivers are made.”

This may be a recipe for success, although it’s unclear if Hunter-Reay was solely responsible for the higher ratings.  Media reports say race fans were watching NASCAR driver Kurt Busch compete in both the Indy 500 and Coca-Cola 600, attempting to drive 1,100 miles in a single day in two different states.  Busch finished sixth in the Indy 500 and withdrew from the Coca-Cola 600 due to a blown engine.

It’s really about the drama that gets people interested.  Look what Tiger Woods did for golf.  Without him in the field, golf tournaments just don’t have the same cache when he plays.  Good, bad or indifferent, more people are watching Tiger.

INDYCAR also can learn a thing or two from NASCAR’s playbook, such as extending the race season and adding more drivers.  A side-by-side comparison between INDYCAR and NASCAR show stark differences, everything from more prize money to more races and drivers.

While adding U.S. drivers to the IndyCar Series may help spur fan interest, it’s hard to deny the talented array of race pros that hail from other countries, including four-time Series Champion Sebastien Bourdais of KVSH Racing.

Contrary to some public opinion, INDYCAR is as American as apple pie.  A tour of the Indiana, IL-based IMS Hall of Fame Museum is evidence of the speedway’s impact on racing history, right here in the United States, a theme that may help carry the IndyCar Series back to national prominence.  In the interim, it may not be a bad idea to raise the drama level between drivers – because everyone loves a great race story.

NBA’s Strong Arm in Black and White

Just as the dust began to settle last week after NBA Commissioner Adam Silver banned Los Angeles Clippers owner Donald Sterling for life, slapping him with a $2.5 million fine for his alleged racist remarks during a taped telephone conversation with a personal confident 50 years his younger, V. Stiviano, the team went on to win game seven of a playoff against the Golden State Warriors – without him.

Ousted Los Angeles Clippers Owner Donald Sterling

Ousted Los Angeles Clippers Owner Donald Sterling

The NBA is no stranger to controversy. It’s much less about the owners, at least until now, although many players have been in trouble with the law for various offenses during the league’s 60-year history.   Some of these incidents have been heavily publicized, while others have gone unnoticed. Either way, the league has worked diligently over the past decade to change its negative perception.

So, it was a no brainer that newly appointed Commissioner Silver, with less than two months on the job, had to come down hard on the outspoken billionaire, especially since many players around the league were planning to boycott the playoffs unless swift and decisive action were taken.

Silver, a lawyer by trade with 20 years at the NBA before his new gig as the league’s commissioner, basically threw the proverbial book at Sterling, making history, administering the most stringent fine and harshest ruling against a team owner, ever.

Sterling’s remarks may have been taken out of context, however, at least according to V. Stiviano during a Barbara Walters interview, who nearly defended her benefactor, saying that she cares for the ousted owner dearly and helped him change into a better person.

Sterling has a long history of making outlandish remarks during his 30-plus years as the Clippers team owner, as well as having a reputation for being a slum lord. Stories continue to emerge from various reliable sources reporting on his borderline racism and unorthodox behavior.

Whether or not Sterling is an out-of-touch-80-year-old billionaire or a real racist remains unclear. It’s also uncertain if the NBA can actually force him to sell his team, although the league announced this week that Clippers President Andy Roeser will be taking an indefinite leave of absence while the NBA restructures the franchise.

Depending on what Sterling will do next in a court of law, the fight now is in the court of public opinion. Keeping silent may not be in this owner’s playbook, so it’s quite possible the NBA will need to pump up its defense because the longer this particular game is played, the more likely professional basketball will suffer.

Google Sees Future with Glasses

Google’s one-day sale of its long-awaited Glass, Internet-connected spectacles “for whatever you do, wherever you go, and whoever you are,” was either a huge success or serious let down, selling out its inventory even before the day was over.

Good news for Google, not so good news for those techies that want the latest gadget now, although the company has launched an “explorers” program, which gives certain developers, testers and early adopters the ability to buy the highly sought-after glasses.

The launch of Google Glass comes at a time when most Americans see the future filled with real-life science fiction.  According to a newly released survey by the Pew Research Center, 59 percent of Americans are optimistic that coming hi-tech changes will make life better in the future.

It’s not all rosy, however.  Americans get a little spooked when it comes to robots, lab-grown human organs and teleportation devices, where a majority see these technological developments as changes for the worse.   Pew also found that a majority of Americans (53 percent) say it would be a change for the worse if most people wear implants or other devices “that constantly show them information about the world around them.”

Whether Pew’s new sci-fi data is a direct correlation to the launch of Google Glass remains unclear.  Early signs point to strong consumer demand for the new specs, even though the Mountain View, CA-based company seems to have focused more on a grassroots marketing approach than a big ad spend,  a strategy that appears to be working well.

Despite consumer hesitation toward humans wearing tech devices such as Google’s new glasses, the global search engine is on the right track.  It’s near impossible to stop the advancement of technology, good or bad.  There always will be those that embrace new technologies and those that are resistant.  In the end, everyone comes around sooner or later.  Just think, not too long ago grandparents were oblivious to the Internet, now they can’t get off Facebook.

Google is transitioning itself from a search engine to a super high-tech powerhouse.  In fact, much of the shift already has occurred with its mapping infrastructure, which literally connects the real world and the Internet making Google Glass possible.  Perhaps in the next decade we’ll see flying drones delivering online purchases or maybe a remote controlled automobile, but for right now Google Glass puts us one step closer to that reality.

Why Candy Lost its ‘Crush’

Candy CrushNearly 100 million people each day play Candy Crush Saga, the highly addictive online game where players match candies in combinations to win points and advance to increasingly difficult levels.

Anyone that has played the game probably can understand why King Digital Entertainment (NYSE: KING), maker of Candy Cush, went public on March 26 through an initial public offering, selling  22,200,000 shares of its stock on the open market.

While timing for IPOs is good, King’s public stock debut went south, dropping 20 percent on its opening day, closing this Friday at $18.96, $3.54 below its asking IPO price of $22.50.

Investor fatigue may be seeping in for publicly traded game makers like Zynga (NASDAQ: ZNGA), which dropped more than 100 percent since its IPO in December 2011 because of poor financials and a declining popularity of its games.

Wall Street may see the same fate for King, mainly because Candy Crush accounts for 78 percent of its sales, although lesser popular games such as Farm Heroes Saga and Bubble Witch Saga have about 20 million daily users, which quite frankly, isn’t half bad.

King’s future success as a public entity undoubtedly depends on its ability to pump out hits, like Disney’s Pixar, which continues to create blockbuster animated films, and Blizzard’s Activision (NASDAQ: ATVI), which had its stock nearly double since the start of last year.

It’s a good bet that consumers will lose its crush on King’s “candy game” probably soon than later, especially since consumer attention spans are becoming increasingly shorter.   Be that as it may, this blogger’s addiction with Candy Crush has dwindled sharply after only reaching level 107, still a long way to go before hitting the illusive 500 mark.  Maybe the game’s 100 million users feel the same way.

Crisis in a Text: Malaysian Airlines Flight MH370

Malaysian Prime Minister Najib Razak yesterday let the world know that its government has to assume Malaysia Airlines flight MH370 ended in tragedy, saying, “It is with deep sadness and regret that I must inform you that flight MH370 ended in the southern Indian Ocean.”

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At the time the prime minister was making his remarks, families of the 229 souls on board were alerted to the news via text message by Malaysia Airlines that read, “Malaysia Airlines deeply regrets that we have to assume beyond any reasonable doubt that MH370 has been lost and that none on board survived.”

Airline officials are now taking heat due to the callous nature of the text message, although company spokespeople said during today’s press conference in Kuala Lampur that the alert was a last resort to ensure families got the news before it was made public.

Whether that is true or not, texting news of this nature to scores of highly emotional families is a recipe for disaster, as images of the reactions of inconsolable family members made international headlines. Any company, especially an airline, should be aware of these general communications disciplines, more so during a crisis of this magnitude.

Somebody had to call it and timing seemed right, although the delivery of the news is in question.  It’s been more than two weeks since the world was put on notice when Malaysia Airlines first confirmed that flight MH370 lost contact with Subang Air Traffic Control, prompting a global search that has uncovered nothing since the plane went missing on March 8.

Officials in Australia, China and France recently reported they found debris via satellite that may or may not be linked to the missing plane.  Other new data has the Boeing 777-200 flying as low as 12,000 feet, which may provide further clues about the plane’s flight path but still has investigators scratching their heads.

The mystery surrounding flight MH370 has created much speculation among media, not to mention extreme angst for the families of the 229 people on board, who have gone so far as to accuse authorities of deliberate search delays and cover-ups.

To the contrary, Malaysia Airlines has provided detailed updates on the status of search efforts, outlined on the company’s dark website, posting recent statements from the company’s chairman, Sri Md Nor Md Yusof, and Group CEO, Ahmad Jauhari Yahya, regarding the prime minister’s remarks.

Aside from the text message snafu, Malaysia Airlines seems to have diverted attention from itself to other countries involved in the “search and rescue” efforts, at least for the time being.  However, as the search moves toward an investigation, more details may emerge regarding the airline’s handling of the crisis, putting the airline in the hot seat as the world seeks answers.

Power to the People

Civil unrest in the Ukraine was escalated this week by a Putin-backed Russian invasion, less than two weeks after the Sochi-hosted XXII Olympic Winter Games came to a close.

Russian President Vladimir Putin asked his country’s Parliament to approve the military action in Crimea, a clear violation of Ukraine’s sovereignty, propelling President Obama and the United Nations to act, either militarily or with economic sanctions, including possibly removing the former Soviet Union leader from the G8 forum of leading industrialized democracies.

Putin’s actions come at a time when the world have unfavorable or mixed views of Russia, according to the Pew Research Center’s 2013 Global Attitudes survey.  More importantly, recent events in the Ukraine overshadow any favorable publicity Russia may have generated during the 2014 Olympiad.

While it is unclear how events in the Ukraine will play out, there is one movement that seems to be gaining traction throughout the world: protest.  Maybe it’s just perception or the rise of social media, which enabled Egypt’s rebellion that ousted two corrupt governments and spawned the awarding-winning documentary, “The Square.”  Heck, it was anti-government protesters just weeks ago that helped expel Ukraine’s President Viktor Yanukovych, one reason for Russia’s current involvement in that country.

From the Arab Spring to Venezuela, people are protesting for change, whether it is to improve human rights, achieve better economic conditions or gain new leadership.  Is it Western influenced propaganda driving these actions?  Probably not.  Long gone are the days when leaflets were dropped from airplanes to influence change, such as with the Japanese during WWII, although radio proved to be a very effective medium in psychological warfare.

Looking back more than two centuries ago, it was Thomas Paine’s “Common Sense” that helped ignite an American revolution.  This pamphlet at the time was read by more people per capita than any other book published in American history.  Many believe it’s the greatest piece of propaganda ever written.

Today the Internet is the vehicle used to drive change.  Rebellion can come in the form of a tweet, post or even a blog.  Either way, the power of protest is alive and well, and spreading globally.