• by Ross Fadner , April 25, 2012

Hi, folks,

We start today's VideoDaily Roundup with the startling news that streaming entertainment usage on Microsoft's Xbox Live service has now outstripped multiplayer gaming (which the service was originally designed for) in the U.S. Next, an Atlantic Wire columnist argues that TV Everywhere doesn't solve the basic problem of today's pay-TV service. Over at the Senate hearing on the future of TV, product placements take center stage, and finally: the video advertising battle is heating up in China as the country's major players consolidate.

Xbox Live Entertainment Usage Outstrips Multiplayer Gaming in the U.S.

The LA Times reports that Microsoft, during its Digital Content NewFront presentation in New York on Monday, had some fascinating news regarding the use of Xbox Live, the online service for its game console, the Xbox 360. Ross Honey, general manager of entertainment and advertising for Xbox Live, said streaming entertainment usage more than doubled year-over-year and had actually surpassed multiplayer gaming on Xbox Live in the U.S. "That's a profound event," he said. "When Xbox Live started 10 years ago, what it was all about was multiplayer gaming. Now, Xbox Live really is an all-in-one entertainment platform."

Indeed. Microsoft, Honey said, has struck some 50 content deals in recent months for Xbox Live, including agreements with cable provider Comcast Corp., and HBO, that offer subscribers access to TV shows via the Xbox 360. He added that Xbox Live has grown 30 percent in the last year to 40 million members, and that the console outsold all other so-called over-the-top devices (such as Blu-Ray players) that connecta TV to the Internet.

TV Everywhere Doesn’t Solve the Basic Problem

New TV Everywhere services like Nimble TV -- which aims to stream your existing cable TV service over the Web for an added fee -- are not the answer consumers are looking for, says The Atlantic Wire's Rebecca Greenfield -- "like all digital content problems before it, until consumers get what they really want in the television department -- raw streaming Internet television sans cable subscription.”

Consumers want on-demand, a la carte options and/or subscriptions to shows that they know they want to watch, not the same overpriced 500+ channel bundle that the cable and satellite companies are selling.  Greenfield argues that as with the music industry before it, consumers will simply steal what they want until the industry gets it right.

Product Placements Adorn The Senate’s Future of TV Hearing

The Senate Commerce Committee hearing on video migration has devolved into something of a product marketing showcase, The Washington Post's Cecilia Kang says, as the execs giving testimony -- realizing that thousands would be watching the hearing via live streaming -- pulled out their respective products. In between demonstrations of the online video capabilities of the Kindle Fire by Amazon and the Xbox 360 Kinect by Microsoft, the execs touted Net neutrality, and warned against the dangers of data caps imposed by carriers and ISPs. As we have noted before, the hearing is the Senate's first close look at the transition away from traditional television services toward on-demand, a la carte and online subscription services.

Video Advertising Battle Heats Up in China, as Players Consolidate

The battle over Web video advertising in China heated up Tuesday when Tencent Holdings, Sohu.com, and Baidu said they would join forces to offer video services in the country. The arrangement will see the three companies collaborate on content licensing and broadcasts. According to Bloomberg, Sohu.com and Baidu’s iQiyi are the third and fourth-biggest players in online video advertising in China, respectively.

Last month, Youku, China's most popular video site, agreed to buy No. 2 player Tudou Holdings in a deal valued at $1 billion at the time. The combined entity would have accounted for more than a third of China’s video advertising revenue in the fourth quarter, according to Analysys International.