Blake Sabatinelli, Atmosphere TV

The 16:9 PODCAST IS SPONSORED BY SCREENFEED – DIGITAL SIGNAGE CONTENT Screens in bars, restaurants and all kinds of venues have been part of the mix for decades, and there have been all kinds of different takes on what to put on those screens that not only entertains and occupies guests, but also has  tangible business impacts. Straight-up digital signage solutions give venue operators the ability to fully manage what appears on the screens, but then those operators have to do the work to keep the system running and content fresh. Boxes and software that squeeze a broadcast signal can allow operators to run in-house ads below and on the side of the screen from cable TV feeds, but the legal side of that can be more than a bit shaky. Widely available high-speed internet and over-the-top streaming technology advances have opened up a new way to keep screens fresh and interesting, and a well-funded Austin, Texas spinout company called Atmosphere TV is going hard at the opportunity. Launched in 2019, Atmosphere has more than 50 streaming content  channels that are in 14,000 venues and reach some 25 million sets of eyeballs monthly. There are curated channels full of cute pets and funny misadventures, but there's also a newsroom that produces carefully selected news that manages to straddle the increasingly polarized political divides of the U.S. The particularly interesting kicker is that the service is free to users, with Atmosphere even sending operators free, pre-staged Apple TV boxes that just need to be plugged in and connected to broadband. I had a great chat with Blake Sabatinelli, the company's Chief Operating Officer, about how things work and where Atmosphere is going. Subscribe to this podcast: iTunes * Google Play * RSS TRANSCRIPT Blake. Thank you for joining me. What is Atmosphere TV all about?  Blake Sabatinelli: Atmosphere at its core is a place-based television platform and we think at Atmosphere that we're here to help inform and inspire people who are watching our platform, and we do that through any one of our 54 channels that are on our platform, whether it's Atmosphere News, which we just launched or Chive TV, which is the the engine that built Atmosphere as a whole before we spun it out on its own. But we're everything from entertainment to information to digital signage and really just here to make sure that we're getting people to look up in the venues that they're sitting in, instead of staring down at their phone and engaging with the world around them.  So the simpleton explanation would be that this is something you would use in place of putting TVs in a venue and putting CNN or Fox or whatever on and just letting that run?  Blake Sabatinelli: A hundred percent. We look at our content in a whole different light that I think what you see in the traditional cable space, and if you go back to the genesis of our company, Leo and John, our founders were sitting in a bar, there was ESPN on mute, there was Judge Judy on mute and they were looking around and no one was really paying attention and they realized that no one was really programming television for out-of-home, and that audio is a huge consideration.  In both places, if you go to a sports bar here in the states, you'll see a football game that's usually the primary audio or a baseball game or something, but there's also 15 other TVs in the venue, and all of them are running captions that are really small, that you can’t see from 30 feet away on content that's not engaging if you don't have the audio on, on content that honestly isn't engaging even if you have the audio on. And in some cases, especially if you're talking about the news, Fox News or CNN, MSNBC, that's angering half the audience there. So we're coming at television from a totally different perspective.  We programmed it for eyes and not ears, which is not a native thing for anyone coming from television. You have to do both and ensure that it's something that everyone can lean into and enjoy and be engaged with. You mentioned that you've launched a news product among the many channels you already have. When I look at Atmosphere TV, and I've been familiar with it for a while, it's primarily soft content, it's curated social media videos, and that sort of thing. News is a very different animal! Blake Sabatinelli: Yeah, you're telling me. I spent 15 years in the news business before joining Atmosphere and ran a company called Newsy for seven years prior to this, and there's a whole different world from what traditionally is published on Atmosphere to what a news channel is. But if you really break it down, it's really not all that different. On the entertainment side of our business, it's engaging short form videos, programmed in such a way that you want to lean in and really watch, and with news, we're really trying to take the same approach. Keep people informed about what's going on around them. Tell them the things that they need to know, do it all in an audio off capacity, which is a challenge out the gate and also sprinkle in some things that inspire and entertain them along the way, because it's a pretty dark world out there and news can be a dark platform. So we feel like we can come at this a little bit differently. Get people to smile, get people to nod and understand what's happening and not feel bad after watching it at the same time.  Is it a function in certain respects of the political polarization that's out there, particularly in the United States, where you have auto dealer showrooms, where they may have one TV and you get arguments breaking out about the fact that it's on CNN or it's on Fox, and as you said, 50% of the people are unhappy? Blake Sabatinelli: I mean, look, I can tell you now that if you watch our network, there are no opinions. There's no commentary, there's only context and information, and that really does come to the point that you're making that the political environment here in the United States is challenging right now. There's no way to make everyone happy. So our view on the way to make this work is to strip out all the things that make people angry and just report facts and just really hammer home the headlines and straight news. There's plenty that happens in Washington on a daily basis that's factual and incredibly important. There's plenty that happens in Washington DC, if you watch Fox News, CNN, or MSNBC on a daily basis, that's filler, that's conjecture and opinion that people for the most part really don't care about.  So I would imagine with some of the other channels that you have, where it's cute pet videos or extreme sports or whatever it may be that, you've got content curators who are scanning YouTube and whatever for material.  Is it different for the new side where you have a quasi news room?  Blake Sabatinelli: Yeah, we do have a newsroom. So we actually hired Michael Grimes, the former head of social for NBC News to come in and join us and lead our newsroom, and we have a team of producers that sit just out in front of my office and are producing news on a 24/7 basis at this point. So yeah, while it's not our normal curation process, there's a news room out there and it's exciting to see and I like the buzz. How do you gather this news? Do you get feeds from the Associated Press and so on, like everybody else?  Blake Sabatinelli: Yeah, that's correct. So we actually partner with a number of down the middle, highly respectful of these organizations, like the Associated Press, AFP, Reuters, and others to ensure that we're aggregating and collecting the best news that's out there and packaging it in such a way that it can be enjoyed on our platform.  So on the other hand with the softer content, how does that work?  Blake Sabatinelli: Yeah. So we have a team of producers that work on each of our channels. Not all that different than what you mentioned that are out actively seeking out content on the most popular social platforms, whether it's TikTok or YouTube or Facebook and working with these content creators to license their content and get it on our platform to then produce it with a very specific formula that we generate for each channel and get it up on our platform when it’s ready to go.  If you use material from YouTube or Facebook or TikTok or whatever it may be, are you talking to those platforms for the rights to that material or do you go right to the content creators?  Blake Sabatinelli: We work directly with the content creators and we work with them in such a capacity that it's a mutually beneficial relationship. Most of these content creators are really looking to extend their reach and ensure they're going to get as many eyeballs on them as a creator as possible to build up their businesses, and we ensure that all of our content creators get a significant amount of showcasing in each of the videos that we air there, so when people see something amazing happening on screen, they're able to look up and say, I want to go to Instagram and follow that guy. So we've built these relationships in such a way that we have an active ongoing discussion with the content creators and when something new pops up in their feed and they're sending it out, they're reaching out to us as well. I guess chasing down certain material from somebody who's in the business or wants to be in the business of creating content that generates income for them that way, they're probably pretty easy to chase down. But on the other hand, you have the serendipitous stuff where somebody took a video of some weird weather event or whatever, I suspect it is probably a lot harder to get them?  Blake Sabatinelli: Yeah, that can be challenging, but we also work with the licenses agencies that those folks work with most predominantly. So whether it's your Stringers or Jukin or others, so wildly large, and when I say large, the vast majority of our content comes from the creators themselves. We also have to work with the licensing agencies as well to ensure that we're gathering all those amazing pieces and putting them in one place.  So technically if I am a restaurant operator, bar operator, and I want to use Atmosphere’s one or two or many channels on it, how do I do that?  Blake Sabatinelli: Great question! You generally just give us a call. We have a box delivered to you. It's a self-install. We have everything set up for you. So you call us, we will send you a fully provisioned device. We have onboarding steps delivered with the box so you can plug in and get set up on the internet, and once you turn your TV and the box on, it's up and running.  Everything is managed by us from a cloud capacity. So our IT team and our engineering teams push updates and manage the devices remotely, and if you ever have any issues, you can call our customer service team. They're there 24/7 to make sure that any issue that crops up is able to be taken care of immediately.  So it's pretty much set it and forget it? Blake Sabatinelli: That's right, and that's why we love the platform so much, and that's why our operators that use the platform love it so much. It's robust, it's highly engaging and it's easy to use.  And this is an Apple TV bow? Blake Sabatinelli: It's a provisioned Apple TV box, that's correct.  If you had a smart TV, like a Samsung or an LG Smart TV that has apps and everything else, could you use that instead?  Blake Sabatinelli: So we actually do everything through our own device. We found that our device is far more robust, easier to keep up and running and just decided to go that direction.  Yeah, and the Apple TV boxes, they've got pretty good third-party device management and things like that. So you can remedy things, and as you said, push up new firmware and everything else.  Blake Sabatinelli: Yeah, a hundred percent. The entire Apple ecosystem is robust, and we've found a great deal of success in working with both third-party management platforms and on the Apple TV platform broadly.  I'm thinking five-six years ago, this would have been a lot harder to do. Over the top streaming capabilities have progressed massively in that time space, right? Blake Sabatinelli: A hundred percent. The proliferation of high-speed internet has been a key catalyst in the growth of the business. You couldn't necessarily deliver gigabytes upon gigabytes of information across a slow 128 kilobytes a second DSL line, that was challenging. And the additional infrastructure that's been built along the way to support services like Netflix and Amazon, HBO Max, and others has really benefited our business as well. There's a digital signage component, I guess you could call the whole thing related to digital signage as well, but there's the ability for the owner-operator of a venue that's using this to go in and add advertising, right? Blake Sabatinelli: That's right.  So we give our venue partners the opportunity to add a couple 30s spots every every couple ad breaks into the channel feeds itself. Everything that we hear back from our partners at this point is that it is a great tool for them to be able to advertise specials, upcoming events, you name it for their venue and it's just really helps complete that fortuitous circle of keeping butts in seats longer, bringing them back more frequently, spending more money, etc. How do they do that? Is there an app or a desktop application?  Blake Sabatinelli: Great question. We actually have a portal with a digital signage manager that allows you to either upload your own assets, or we have a tool that allows them to create their own assets on the fly within the ecosystem itself. So if you have an agency and you've been working with them, or you have a creative team and you work with them to create assets, that's great. But if you don't, you're at a small bar or a restaurant, or a dental office and you need to get something done. We have a tool in there to help you build this.  With templates and things like that? Blake Sabatinelli: Yeah, we have templates, both video and still, and a ton of options in there.  Do you work at all with third party digital signage CMS software platforms or is it that either you're going down this path or you go down that path. You can't really merge the two?  Blake Sabatinelli: So primarily we work within our own platform. So all of our tools are built custom for our device and custom for our platform as a whole.  If there is an opportunity for us down the road to work with third-party software operators, whether that’s for queuing or for other signage options? A hundred percent, but right now we've been operating and developing all our own software.  Do you get beyond the simple component of throwing ads every three minutes or whatever it may be and enable a venue operator to do things like, ”Hey, we're hiring!” or things like that that get into messaging as opposed to advertising? Blake Sabatinelli: Whatever they want to run in those spots, it's up to them. We're not in the business of policing how businesses operate their own signage option. So if they're looking to post that they're hiring, which I know every restaurant in America is right now, then we would encourage them to use the tool to do that as well. It’s a subscription, right?  Blake Sabatinelli: So our platform as a whole is actually free. If you want to use the digital signage option, it's $50 a month.  So you send them a free Apple TV box?  Blake Sabatinelli: That's right. We send people a free Apple TV box and we ask very few questions of them. Our goal is to get people on board and running and streaming and getting people enjoying the content as fast as possible, and while it sounds too good to be true, it's not.  We give you a free Apple TV box. We pay for that Apple TV box by providing advertising. So we're advertising a sport or business, it's a vast majority of our revenue stream, and we find it works for both us and for our partners.  Okay. So there's a programming wheel and there’s interruptions in that programming wheel that are both for booked advertising, that your team or the Atmosphere team has sold or is through programmatic platforms of some kind, but if you want to do local on-premise venue specific advertising, that's an opportunity as well, and you pay $50 a month for that?  Blake Sabatinelli: You hit the nail on the head there, and we end up offsetting some of those advertising slots that we normally would sell on a national or local capacity for the venue operators themselves. What's your built-out footprint at this point?  Blake Sabatinelli: We're over 15,000 venues right now, reaching I want to say 48 million unique visits on a monthly basis at this point. Did some of that transfer over from Chive or is that starting from scratch a couple years ago? Blake Sabatinelli: So some of that definitely transferred over from Chive. Chive was an incredible catalyst and test case for us to be able to understand product market fit and the dynamics of the marketplace. We have doubled our footprint over the last year and have seen tremendous growth post COVID. Now if you look back at back in the Chive TV days, we were primarily focused on only bars and restaurants and bars and restaurants are still our bread and butter at this point, they make up 60% of our venue footprint but we've definitely diversified significantly and learned a lot post COVID too.  Now there's any number of Software companies and solutions companies that sell into hospitality, sell into restaurants and bars and all those kinds of venues, as well as clinic waiting rooms and so on. They would sell a software solution that would enable the operators to go in and do all of their on-premise messaging and everything else but they would then have to subscribe to a third party content service, like a ScreenFeed, or one of those kinds of companies to provide the other content for the wheel.  Is that something you sell against or are you finding people are saying, “You know what, I love the ScreenFeed material and everything else, but we just can't keep up with all this. We don't want to manage it. If we could just get something that just shows up, that would be better”?  Blake Sabatinelli: Yeah. So there's a couple of constituencies that we sell against.  Primarily for us as is against the pay television ecosystem. There's not a lot of great options that exist for waiting rooms or public spaces that exist in the pay TV ecosystem. Some of the contents are wonderful with the audio on, but when the audio is off, it's not, and there's also no signage options in there, which clearly is a challenge. There's also the folks that are endemic to the space, to your point, the operators that work with the waiting rooms, especially around point of care and we do hear a lot that people just really want to make sure that the perceived wait times are going down and they can provide signage options, and for us, making sure that our venue operators have higher net promoter scores that proceed wait times are lower in bars or in restaurants, that you're staying for longer is really the key. Beyond that, the additional messaging is a bonus.  I'm going to assume that you guys have done the work to try to develop and highlight some of those metrics, right? Blake Sabatinelli: That's a hundred percent correct. So we've worked with in-market to understand dwell time and other metrics within our restaurant venues, we work closely with our metrics partner Epicenter on how people are engaging and activating with our content, and then a number of case studies along the way to really drive down the funnel, the efficacy of the platform and everything.  So what does happen? Does it increase dwell times if I'm ordering a second round of drinks or another plate of nachos or whatever?  Blake Sabatinelli: Our last study showed that we had 16% longer dwell time in bars and restaurants and 18% higher return frequency amongst customers and a lot of our venue partners who shared back some of their net promoter scores have gone up based on our content being in place.  So really there's no argument against it. If they're going to have flat panel displays, whether they're TVs or commercial displays in their venues anyways, and if they get the Apple TV box free, then you know, I would imagine it's hard to say no? Blake Sabatinelli: Like I said, we've grown really fast the past 18 months post COVID and the business has been booming. So I agree with you. It's hard to say no.  The biggest challenge that we have, and it's really about getting people to understand that this thing that they didn't know existed in a segment that really doesn't have anyone else playing in it. It exists and it's going to be beneficial to their business. Once they understand how this fits into their restaurant experience or their waiting experience, it's an easy close.  So you mentioned how the growth happened in the past 18 months, I keep saying 18 months, it's probably like 20 months now. Blake Sabatinelli: It's been a long time. I've lost count at this point. I think everybody has, as I'm sitting in my home office saying that.  COVID was an interesting thing for our business. Look, I don't think anyone in the media space would say that things didn't go a little haywire in April of 2020 but it did also give us the opportunity to evaluate our business model, our distribution strategy, and to really think about how we could expand and pivot a little bit. So while bars and restaurants were closed, aftermarket auto and doctor's offices, dentists offices, and others still had people coming into them, especially outside of California and New York, so expanding our distribution strategy has allowed us to not only keep up and running through COVID, but to dramatically increase the velocity of our distribution as we've gone out of the initial wave of COVID and into the present day.  Is there a type of a vertical category type of venue that seems to adapt it more so than others? Blake Sabatinelli: I'll be honest with you. We've seen strong growth in that across a number of categories. So everything from traditional bars and restaurants to QSR, we've seen explosive growth in gyms, in aftermarket auto, in point of care. Moving now pretty aggressively into airports and other spaces. We've just seen strong, measured growth across every category and every segment that's been incredibly encouraging.  When you onboard new clients or new venue clients, do you do any work to audit the type of audience that they may have and make recommendations about the channels that suit them best? Because I'm really curious whether a venue puts in a channel that’s about cute puppies or whatever, and the audience would be saying, “Why are you showing that?” Or “Why are you showing news? I don't want to see the news.”  Blake Sabatinelli: There's plenty of venues that Chive TV works really well in, but in veterinarian offices, Paws TV plays better and so we make that recommendation. The same goes for news in airports in the doctor's weightings rooms. So we're incredibly thoughtful about how we present our content and where we think it should play, and our customer service and account management teams work closely with our venue partners to ensure that they know new options are available and that options they may not know about that may suit their venue better are available as well. Do you try new content channel formats and try them out with test partners and sometimes just throw them out, cause that doesn't work?  Blake Sabatinelli: We wouldn't be a tech driven platform if we weren't doing a significant amount of AB testing. Our product team and content teams were constantly working within new partners to do tests and learn to better understand product market fit of a channel or a new format and to better understand how we can continue to improve the product. It's a constant process and it's just part of operating in the ecosystem that we do.  Have you learned things about length of material, like duration of material?  Blake Sabatinelli: We actually have and there's a reason that if you look at the content on our platform, it's formatted the way that it is. People want to quickly move from one thing to an X and I think that's partly a by-product of this new world that we live in where short form, highly addictive, highly engaging video is the norm. You're used to looking down and getting that dopamine rush. So fitting that format onto a big screen is important for us. And then just people are really looking for variety too. That's why we have custom playlist features that allow you to compile a number of different options into one because not everyone wants to see the same thing for a long period of time. So we try to keep the format moving, we try to keep the content moving. We try to keep it varied and engaged as much as we possibly can again, to reduce perceived wait times on one end or in some cases to ensure people are sticking around the same. I'm hoping I can get another round of people doing amazing things.  How do you deal with portrait material, stuff shot in portrait mode? Blake Sabatinelli: At this point pretty much everything is shot in a vertical format. So you get pretty used to working with curtains. We've done a good job of being able to cycle back and forth between the vertical and horizontal formats as effectively as possible, and I think people have gotten used to seeing video shot both vertically and horizontally. Ten years ago, I remember you would shoot a video on a cell phone while working in the news business, you would be screaming in the control room. Why didn't they turn their camera sideways? In this instance, everyone's used to this, this is the new normal and it's really not that big of a concern.  And I guess the advancements of camera sensor technology and smartphones has been good news for you guys as well. Like you say, 10 years ago, I remember I had a Blackberry about 10 years ago and that camera was dreadful.  Blake Sabatinelli: 320x240 resolution and if you watch that on my little MacBook that's sitting in front of me right now, I believe the kids would say it looks like it was shot on a potato.  Look, the advancements in camera technology have just really been a boon to businesses like ours. I have one of the crappier iPhones in my pocket and I think it's probably a higher resolution camera than the SLR that's sitting in my closet that I've never used. So it's been fantastic for us.  Yeah, that's exactly right. I've got a mirrorless camera, nice SLR, and I never use it because it's just so much easier to whip out my phone, take a shot, and it's got like a 16 megapixel sensor and it looks great!  Blake Sabatinelli: Yeah. What a time to be alive that I don't have to carry a giant camera or a camera bag around with me anymore. So I'm not going to complain.  You recently announced, I believe that you are expanding Atmosphere TV into Canada, right?  Blake Sabatinelli: That's correct. We're actually moving aggressively there right now.  When I look at your installation map, it throws me off a little bit. It looks like you already have a lot of points of presence in Canada, or is that just the way the map looks? Blake Sabatinelli: So we do have some presence in Canada to start off with, but now we're making a concerted effort to actually come in and take as many shares as we possibly can in the marketplace. But early on we were testing, are we a hundred percent sure that the content is going to work just the same as it does in Canada? It does. Is our distribution and sales model gonna work exactly the same? It will. Is the ad sales model exactly the same? It is, and so at that point, we all sat down and made the decision to make a more concerted effort to move into Canada, to take more share and to really replicate the model that we have down here in the States. Yeah, that would be the easy one. The harder one would be going South.  Blake Sabatinelli: Yeah. Look, our primary target out the gate is English speaking countries. We have Canada, Australia, New Zealand, there's plenty of others that'll be coming down the pipeline. But moving into second languages is definitely going to be a focus for us, especially as we start to understand what the economics look like in each market, how we can program in those markets in such a way that we do here in the United States and in Canada, and then we'll continue spreading in that direction.  How big is the company at this point?  Blake Sabatinelli: The headcount changes every single day. I think we're at 220 people. We've about tripled our head count since I joined in March, I think I was employee number 84.  So there's 110 plus people who you've not met yet because you're working out of your bunker?  Blake Sabatinelli: I go into the office four days a week and I am incredibly thankful that I'm able to go in and actually see people face to face and so we have a large contingency here in Austin, satellite offices now that are popping up in New York and LA, and Chicago is on the roadmap. While we're almost all here, there's a decent chunk of us that are external, and I've had the pleasure of meeting everyone in person. How much of that would be Editorial versus Sales versus IT or Ops, I guess you'd call it?  Blake Sabatinelli: Editorial’, probably a quarter of our company. IT and Operations, probably another quarter, and then the rest is spread across Distribution and Ad Sales and GNA, and other. Has it been hard to manage all this largely virtual? Blake Sabatinelli: So we've been back in the office since March at this point. There has been a significant amount of growth with all of us virtual. I'm not going to tell you that there hasn't been a growing pain or two and that it's all easy, and this is a cakewalk, Dave, but our team's incredible, our HR team, our finance folks, recruiters, everyone that works on our team to find, identify and bring and onboard new employees, they're wonderful and so it hasn't been as bad as I’d think as other experiences I've heard across the industry.  My twenties and thirties were spent in newspaper newsrooms and I struggle to wrap my head around the idea that you would have a dispersed newsroom where you're only talking to each other by video meetings and Slack. Blake Sabatinelli: We did it in April of 2020. The entirety of our Newsy at home and we spun up live operations in people's living rooms and it was absolutely bananas, and that was as difficult as you would imagine, and was ripe with challenges, but that team got it done too and made it look easy. I think one thing that I've learned in this new COVID world is to truly expect the unexpected, and so long as you're comfortable with that, and so long as you know that something's going to blow up at some point in time and you're ready for it, then it's not that bad. So what can we expect from Atmosphere TV in the next year, are you going to be launching more products?  Blake Sabatinelli: Yeah. So I think you're going to see a pretty significant expansion in our content offering. We've had the opportunity over the last year to really understand product market fit, to do a significant amount of tests and learn, to gather the data that we need and really prepare ourselves to start running. I feel like we've been at a full sprint, but now it's time to move like Usain Bolt for the next couple of quarters. So a significant expansion in our content offering in the size and scale of our company and our distribution footprint. We have big plans ahead and I expect you'll be able to watch Atmosphere pretty much everywhere you go here soon.  Are you still hiring people?  Blake Sabatinelli: We are hiring like crazy and have plans to continue at a pace like we are now through the next two years.  Great. All right, Blake, thank you so much for spending some time with me. Blake Sabatinelli: It's my pleasure. Thanks for the time Dave.