Vizio's Profit On Ads, Subscriptions, and Data Is Double The Money It Makes Selling TVs (theverge.com) 49
The TV maker released its latest earnings report on Tuesday and revealed that over the last three months, its Platform Plus segment that includes advertising and viewer data had a gross profit of $57.3 million. That's more than twice the amount of profit it made selling devices like TVs, which was $25.6 million, despite those device sales pulling in considerably more revenue. The Verge reports: When Vizio filed to go public, it described the difference between the two divisions. While Devices is easy to understand -- 4K TVs, soundbars, etc. -- Platform Plus is a little more complicated. It counts money made from selling ad placements on its TV homescreens, deals for the buttons on remotes, ads that run on streaming channels, its cut from subscriptions, and viewer data that it tracks and sells as part of the InScape program.
The company says shipments of its TVs fell to 1.4 million in 2021 compared to 2.1 million in 2020, a drop of 36 percent. CEO William Wang told investors on the call that he sees "pretty healthy inventory" going into the holiday season, so anyone planning to pick up a value-priced TV or soundbar should have some decent options available. That spike in Platform Plus revenue, which shot up 136 percent compared to last year, did a lot to help Vizio make up the difference as profits from TVs dipped compared to last year. Supply chain and logistics problems affecting many companies hit Vizio hard, too, but execs also said the company is working with its third-party partners to help find warehouse and trucking employees.
Where the numbers keep growing is in its number of active SmartCast accounts, which are now over 14 million, and how much money it makes from each user on average. That number has nearly doubled from last year, going from $10.44 to $19.89. On the call with investors and analysts, Vizio execs said 77 percent of that money comes directly from advertising, like the kind that runs on its WatchFree Plus package of streaming channels, a group that recently expanded with content targeting. The next biggest contributor is the money it makes selling Inscape data about what people are watching.
The company says shipments of its TVs fell to 1.4 million in 2021 compared to 2.1 million in 2020, a drop of 36 percent. CEO William Wang told investors on the call that he sees "pretty healthy inventory" going into the holiday season, so anyone planning to pick up a value-priced TV or soundbar should have some decent options available. That spike in Platform Plus revenue, which shot up 136 percent compared to last year, did a lot to help Vizio make up the difference as profits from TVs dipped compared to last year. Supply chain and logistics problems affecting many companies hit Vizio hard, too, but execs also said the company is working with its third-party partners to help find warehouse and trucking employees.
Where the numbers keep growing is in its number of active SmartCast accounts, which are now over 14 million, and how much money it makes from each user on average. That number has nearly doubled from last year, going from $10.44 to $19.89. On the call with investors and analysts, Vizio execs said 77 percent of that money comes directly from advertising, like the kind that runs on its WatchFree Plus package of streaming channels, a group that recently expanded with content targeting. The next biggest contributor is the money it makes selling Inscape data about what people are watching.
"Smart" TVs (Score:5, Funny)
Dumb consumers.
Re: "Smart" TVs (Score:2)
Re: "Smart" TVs (Score:2)
By that definition, which is commonly used to disparage Facebook and Google, product is you is true of any company that sells ads. Everything from newspapers to billboards. Seems like a warped thing to get ones panties in a bunch over.
Re: (Score:3)
When I buy an inkjet printer, I know what I'm buying. A freakin' printer.
When I buy an inkjet ink cartridges, I know what I'm buying. Freakin' inkjet ink cartridges.
When I'm buying a TV, I'm expecting to buy a TV, not a device that force ads on me and tries to steal my information.
Re: (Score:2)
Absolutely valid point.
There was a time when people raged about their TV's reporting on them. We called them conspiracy nuts. Now we connect all kinds of devices to livestream audio and video from inside our homes.
Pure idiocy.
Note to self (Score:3)
Re:Note to self (Score:5, Insightful)
A better idea is to just make sure that the smart TV you buy can be activated and used without being connected.
I have 4 smart TVs total in the house, none of them are connected to the net, they are used as "stupid TVs" and and as large computer monitors , but the price on them was pretty low because the manufacturer had gotten kickbacks from all those preinstalled apps and such.
Re: Note to self (Score:5, Interesting)
Re: (Score:2)
On occasion, about once a quarter, I will allow those connections for software updates that provide enhancements.
I'd be wary of those "enhancements" too; vendors are aware some users don't allow their TVs to connect to the Internet, and I'm pretty sure they want to monetize them too. What if the "enhancement" loads some ads in ROM, and they get played directly from your TV without the need for net access? You'll end up seeing the same ads again and again, at they would soon get as annoying as the "apply directly to the forehead" thing of sad memory. Or else, the TV could log your viewing habits over time, and upload t
Re: (Score:2)
On occasion, about once a quarter, I will allow those connections for software updates that provide enhancements.
I'd be wary of those "enhancements" too; vendors are aware some users don't allow their TVs to connect to the Internet, and I'm pretty sure they want to monetize them too. What if the "enhancement" loads some ads in ROM, and they get played directly from your TV without the need for net access? You'll end up seeing the same ads again and again, at they would soon get as annoying as the "apply directly to the forehead" thing of sad memory. Or else, the TV could log your viewing habits over time, and upload them in a burst when the connection is available, so you still get spied on even if your TV is mostly offline.
I'd be more concerned about an *update* that requires a regular connection to the manufacturer mother-ship for *their* product to continue being usable unless you've also provided a way to back-out manufacturer updates.
Re: Note to self (Score:2)
Re:Note to self (Score:5, Interesting)
Another thing you can do is figure out where the traffic is going and use a Pi-Hole (or just dnsmasq or unbound on your PC if you don't want to buy a Pi) to block it from communicating with the TV's servers. Smart TVs allow you to configure the DNS server (probably because they have to so they play friendly with all ISPs), which makes it pretty trivial to prevent them from being as nefarious as they want to be.
Your method is obviously easier for the non-geek, but my wife wants the smart TV to work rather than use the Apple TV or another connected device. She likes how it has a Netflix button and she only has to worry about a single remote. If I can block it from phoning home without interrupting her smart TV experience everyone is happy. Another nice thing about going the Pi-Hole route is that we can watch IMDb TV on Amazon (free with ads) and it will cut out most and sometimes even all the ads (you can't always cut out 100% because you can't block some without blocking the show—these are usually Amazon commercials).
When it's just me watching, I use the Apple TV but it still helps to run that through the Pi-Hole, too.
Ok until Amazon Sidewalk mesh network (Score:2)
I'm waiting for new TVs to be part of Amazon's Sidewalk mesh network, and serve ads and surveil you without using your internet connection directly. Indirectly, if you have Ring etc, or indirectly if an in-reach neighbour does. In higher density neighbourhoods, you're done honey chile.
Next step is the TV not working without a connection, similar to many game, and the new Windows 11SE which is cloud-only.
Re: (Score:2)
I have a Ring Thermostat. The supplier didn't mention this in the quote bummer. At least it works without being connected to the internet. Even if it did manage a connection to my network my firewall will block any attempts to phone home.
That said, I log all outgoing connection attempts. Any that are not on my permitted list, are notified to me. It is surprising what [redacted] is happening deep in many websites.
Re: (Score:2)
DNS based blocking is a stopgap. It used to work for YouTube, but not anymore. They deliver ads from the same servers as the videos.
In time more and more services will start doing that. The best option seems to be a set top box that you control enough to run alternative apps on, like Smart YouTube Next. Some smart TVs run Android. Anything locked down will be a lost cause eventually.
If course there's always the Pirate Bay, usually the best quality option.
Re:Note to SWASTIKAS!!! (Score:1)
ii ii ïi ii iï ii ii ijDMMQtii ii ïi ii iï ii ii i [youtube.com]
ii ii ïi ii iï ii iicXMMNMMNQjii ii ïi ii iï ii ii [youtube.com]
ii ii ïi ii iï ii cSMMNMMNMMHJii ii ïi ii iï ii ii [youtube.com]
ii ii ïi ii iï iiSWMMNMMNMHJii ii ïi ii iï ii ii i [youtube.com]
ii ii ïi ii iï 6WMMNMMNMNYii ii iiJcii ii ïi ii iï [youtube.com]
ii ii ii ii i5WMMNMMNMN5ii ii iiJHMMScii ii ii iii [youtube.com]
ii ii ii ii5NMMNMMNMW5ii ii iiJHMM [youtube.com]
Re: (Score:2)
Easier: Do not set up your smart TV on WiFi but use it as a display.
Alternative: Use wired Ethernet only, and only when you specifically want to use those *smart* services.
This... (Score:3)
...is why my 2 smart televisions are used as dumb televisions behind 2 4k AppleTVs. They don't have commercials, nor am I their product.
If the ad branch subsidizes the hardware branch...I guess I win with lower TV costs.
Re: (Score:2)
If the ad branch subsidizes the hardware branch...I guess I win with lower TV costs.
Sure - until the subsidized hardware gains enough market traction that it's the only kind available. Then any TV you can buy will require an active internet connection to work at all. Those TV's will suddenly be more expen$ive. And you'll spend still more money for aftermarket mods to defeat the spyware and advertising - if defeating it is even possible.
So, in other words... (Score:3)
...we get cheaper TV's, but on the downside, we have to ignore ads?
Hmmm. What to choose - a more expensive TV with fewer ads to ignore, or a cheaper TV and time to fetch a beer instead of watching commercials.
Wow, that's a tough one alright.
Re: (Score:2)
Only if you think TV's would be subsidized by ad income. I highly doubt it, it is just another revenue source they're only too willing to exploit.
Re: (Score:1)
Only if you think TV's would be subsidized by ad income.
you can buy a 75" 4k smart tv for under $1000 these days.
dumb TVs were never that cheap, and that's not even considering inflation.
Re: (Score:2)
It's called a pause button, nobody watches live TV anymore.
Re: (Score:2)
What makes you think that you get a TV cheaper just because you're bombarded with ads?
Re: (Score:2)
So, your assumption is that you get an expensive TV with ads, or a cheap TV with ads?
Alright, so why would you pay extra for a TV that gives you nothing that you wouldn't have with a cheap TV?
Re: (Score:2)
Because one more checkbox is ticked. You know, on the card that you get next to the TV. Where they list all those nifty cool features. DLNA, 4k, 8k, KMA, FU2, ...
What do you mean, you don't know what they mean? That doesn't matter, but this one has one checkbox ticked more than that one, so it is better!
Subsidized tvs (Score:3)
I was thinking of splurging on a 4k tv this year and you better read the negative reviews first. The TCL Roku tvs are cheap for a reason. They make you create an account and enter a credit card number before they start functioning. I don't know if you can even use one without connecting it to the internet first. My current "smart" tv isn't connected to the internet and everything is streamed from a PC. No bullshit slow and clunky apps.
Re:Subsidized tvs (Score:4, Interesting)
That was not my experience. I have a TCL Roku TV, and it worked great as a dumb TV until I let it connect to the Internet. I never had to give it any credit card information to make it work, though I did create an account. I turned off the "spy on me to see what I'm watching" option in the advanced privacy menu. Once I had it set up, I added firewall rules to block the advertising, though you only see that on the home screen.
Other than blocking the home screen advertising, there was nothing unusual or tricky I had to do to make it work for me.
As to using it without connecting to the Internet, I'll go further and say that I really like the interface. You can rename or disable any of the inputs as needed. You can tell it whether you want the home screen, last-used input, or a specific input to be active when you turn it on. It's really the ideal dumb TV out of the box.
Re: (Score:2)
Never had to give a credit card number. Just need an account.
Re: (Score:2)
What erosion has happened that "don't need a credit card number, just need an account" is somehow a okay?!?!?! I'm sorry, but appliances asking me to create accounts just to track me IS NOT SOME SORT OF COMPROMISE! OMG people! Buy them and return them so that the manufacturers get the message!
Re: (Score:2)
Or don't buy them at all after researching. You can always not connect to the Internet and use it as dummy TV. Everything tracks these days online. :(
Re: (Score:2)
What I see people saying in this discussion is that some TVs require the internet connection. That is what is scaring me.
Re: (Score:2)
I also read that future TVs might include cellular modems. :(
Re: (Score:2)
No to CC (Score:3)
From manual for the $2000 8 series...
Re: (Score:3)
Re: (Score:2)
. They make you create an account and enter a credit card number before they start functioning.
Time for one of those one-time-use credit cards with only $1 on it.
Re: (Score:2)
No! Don't hack around the system -- make them change it by returning the item!
Re: (Score:2)
By charging it back I keep the money and the TV.
But I guess I could zorch it into a brick with a jolt of high voltage and then return it.
Re: (Score:2)
A commercial signage display (Score:2)
ah, plasma (Score:2)
why not free TV ? (Score:2)
In the book and movie '1984' there were TVs everywhere. Mandatory TVs! Do you think the citizens bought them at Best Buy on Black Friday? No, those TVs were a gift of Big Brother. That is because the message to the People was more important and outweighed the cost of the TV. We are approaching a similar situation today. So expect free television sets very soon.
(It's been 70 years since I read the book; apologies if I mixed in memories of other books.)
Re: (Score:2)
What makes you think that? Was your phone free?
And no, getting it on installments, i.e. bundled with a 2+ year contract you pay for monthly and can't cancel, is not free.
You don't own anything (Score:2)
Welcome to the for profit surveillance state.
Took my last Visio back... never again (Score:2)
I had a Visio years ago and really liked it. It was a solid TV.
Last year I got a TV for my partner and with such a great prior experience with Vizio, that's what I went with. That was a huge mistake. First, it required accepting at least 2 EULAs before the thing could even be used (even when not connected to the internet).
Second, and I can't even believe this, they didn't have a "sleep" button on the remote. To get the sleep function, it took 9 button presses to navigate the menu and choose to "sleep af
Kill it with fire (Score:2)
If I start seeing ads on a TV or monitor I'd paid for, there's gonna be some shit going down.
Step one- charge it back to wherever I bought it from as it's "unfit for use as sold".
Step two- find a way to nuke the ads (if that's even possible). If not, then...
Step three- throw it in the trash or sell it on Craigslist.
News? (Score:1)