MUScoop
MUScoop => The Superbar => Topic started by: akmarq on March 27, 2013, 05:05:02 PM
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Something that has been discussed often here (though usually in relation to sports content). HBO is considering allowing people to pay for HBO GO independent of a cable subscription.
Finally.
http://www.avclub.com/articles/hbo-starting-to-think-letting-people-without-cable,94082/
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I saw this a few days ago: http://www.muscoop.com/index.php?topic=37202.msg473207#msg473207
You can see the resident TV/media expert's response just below mine.
I certainly would love for them to do it. I can't imagine it would be all that big of a deal to just put their on-demand content as a separate option from cable.
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Something that has been discussed often here (though usually in relation to sports content). HBO is considering allowing people to pay for HBO GO independent of a cable subscription.
Finally.
http://www.avclub.com/articles/hbo-starting-to-think-letting-people-without-cable,94082/
They've been "considering it" for a few years now and the math doesn't work. I'm getting a kick out of these articles.
"Right now we have the right model".
This is a challenge to HBO, however it would be a risky step for the company to by-pass its traditional distribution partners, which provide HBO with lucrative subscription fees.
There are billions of dollars generated from HBO's existing distribution network and to simply circumvent that would not make business sense, Plepler said in January, according to the Wall Street Journal.
Now, down the road could it change....of course. But they know for it to change their expenses go through the roof in a way they cannot appreciate.
Hire 20 to 30K agents for one.
The fact that a huge part of this country doesn't have broadband
The fact that almost every distributor has MFN clauses in their contracts that basically say if you sell over the top, they can stop selling it. Now what...now what happens to all those customers that used to get it from Comcast, or DISH or FIOS who tell HBO to pound sand but they don't have broadband. That's going to go over well.
The fact that most of the heavy lifting on marketing is done by the distributors to their 100 million customer households, an expense they will now bear.
I don't doubt it could happen and one day someone will say "I told you so". No need, one day it will happen. Today, the math does not work in so many ways. Kessler, etc...all of these guys have answered the question the same way every year. Of course they mull it, they would be stupid not to. That's without even factoring in the ever escalating price of broadband that is coming along with cap limits....another cost to the consumer.
It's a very risky decision for them....one they haven't made yet because the numbers don't add up. Maybe some day they will....I'm sure they will.
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Chicos, couldn't these bundling companies just go digital? Offer their entire package, or series of packages, online? Is that viable option if selling individual "channels" is not?
I'm not in the mainstream consumer market for these products, but honestly they have all lost me... cannot see paying for them under the existing models... but, again, I am 3 standard deviations away from the norm on this one (literally).
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Chicos, couldn't these bundling companies just go digital? Offer their entire package, or series of packages, online? Is that viable option if selling individual "channels" is not?
I'm not in the mainstream consumer market for these products, but honestly they have all lost me... cannot see paying for them under the existing models... but, again, I am 3 standard deviations away from the norm on this one (literally).
Sure, but to do that they risk losing out on the billions they already have. That's the decision they will have to make. The one that very few are making because they end up losing more money in the process. At least today.
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I know this is an old thread, but I had to post this story. Really interesting.
http://tv.yahoo.com/news/john-mccain-introduces-cable-la-carte-legislation-stop-171331371.html
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I know this is an old thread, but I had to post this story. Really interesting.
http://tv.yahoo.com/news/john-mccain-introduces-cable-la-carte-legislation-stop-171331371.html
Yup, good old John trying this again....tried this in 2006 where it fell flat because of what it truly means for people....like much of what he touches, he has no clue how it works and what will happen as a result. Less choice, a lot more cost....he didn't finish 5th from the bottom of his class for nothing. This is why in Canada customers have this choice and are paying much more per channel than they used to and customers are pissed about it and advocating for the old system. Oh the irony.
Can't wait to see the complaints by customers now who pay about $5.50 per month for ESPN when they will now pay $20 for that ONE channel. So instead of paying $70 for 140 channels, you'll pay $55 (save $15) and get 15 channels (if you are lucky). What a deal. Can't wait to see what the gov't does when certain special interest channels no one wants, are they going to force them on folks or let them die. ::) Fun times. I think when I go to McDonald's next time I'll ask to have the Big Mac without the middle bun and demand a price reduction because I don't want "all of it". Or perhaps take it further where in the ESPN example I don't care about women's softball, so I should be able to deduct that cost and only pay for certain shows I watch on ESPN. Say bye bye to a ton of good content if this happens, because there will be no money to develop good projects. Government and unintended consequences...like a glove to a hand.
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Yup, good old John trying this again....tried this in 2006 where it fell flat because of what it truly means for people....like much of what he touches, he has no clue how it works and what will happen as a result. Less choice, a lot more cost....he didn't finish 5th from the bottom of his class for nothing. This is why in Canada customers have this choice and are paying much more per channel than they used to and customers are pissed about it and advocating for the old system. Oh the irony.
Can't wait to see the complaints by customers now who pay about $5.50 per month for ESPN when they will now pay $20 for that ONE channel. So instead of paying $70 for 140 channels, you'll pay $55 (save $15) and get 15 channels (if you are lucky). What a deal. Can't wait to see what the gov't does when certain special interest channels no one wants, are they going to force them on folks or let them die. ::) Fun times. I think when I go to McDonald's next time I'll ask to have the Big Mac without the middle bun and demand a price reduction because I don't want "all of it". Or perhaps take it further where in the ESPN example I don't care about women's softball, so I should be able to deduct that cost and only pay for certain shows I watch on ESPN. Say bye bye to a ton of good content if this happens, because there will be no money to develop good projects. Government and unintended consequences...like a glove to a hand.
Nick Naylor? Is that you?
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Nick Naylor? Is that you?
::)
Be careful what you wish for, you might just get it. Besides, you gave up TV already, what do you care. :)
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Yup, good old John trying this again....tried this in 2006 where it fell flat because of what it truly means for people....like much of what he touches, he has no clue how it works and what will happen as a result. Less choice, a lot more cost....he didn't finish 5th from the bottom of his class for nothing. This is why in Canada customers have this choice and are paying much more per channel than they used to and customers are pissed about it and advocating for the old system. Oh the irony.
Can't wait to see the complaints by customers now who pay about $5.50 per month for ESPN when they will now pay $20 for that ONE channel. So instead of paying $70 for 140 channels, you'll pay $55 (save $15) and get 15 channels (if you are lucky). What a deal. Can't wait to see what the gov't does when certain special interest channels no one wants, are they going to force them on folks or let them die. ::) Fun times. I think when I go to McDonald's next time I'll ask to have the Big Mac without the middle bun and demand a price reduction because I don't want "all of it". Or perhaps take it further where in the ESPN example I don't care about women's softball, so I should be able to deduct that cost and only pay for certain shows I watch on ESPN. Say bye bye to a ton of good content if this happens, because there will be no money to develop good projects. Government and unintended consequences...like a glove to a hand.
It probably would be a good value for those who do not want ESPN or other sports packages. They are subsidizing the other side of this equation.
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It probably would be a good value for those who do not want ESPN or other sports packages. They are subsidizing the other side of this equation.
A lot of people are subsidizing a lot of different things so that everyone can get a lot of different choices. That's part of my point, you go a la carte and a lot of channels go bye bye forever, even if they have a following because 10% following for a niche channel can't be supported in that model. If everyone is paying 5 pennies per month for it, then it works. If you are asking only 10% of the households to pay much more than that, then it's a different scenario.
Would AMC be able to create Madmen or Walking Dead without the safety net of guaranteed revenues from all the subscribers that pay into? Absolutely not. As a result, they wouldn't risk creating those types of high cost shows anymore. Makes no sense for them. They need to know what revenues they can count on in order to invest in the content risks they take in show development. No different than the sports channels bidding on rights for the NFL, the Big East Network, etc.
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A lot of people are subsidizing a lot of different things so that everyone can get a lot of different choices. That's part of my point, you go a la carte and a lot of channels go bye bye forever, even if they have a following because 10% following for a niche channel can't be supported in that model. If everyone is paying 5 pennies per month for it, then it works. If you are asking only 10% of the households to pay much more than that, then it's a different scenario.
Would AMC be able to create Madmen or Walking Dead without the safety net of guaranteed revenues from all the subscribers that pay into? Absolutely not. As a result, they wouldn't risk creating those types of high cost shows anymore. Makes no sense for them. They need to know what revenues they can count on in order to invest in the content risks they take in show development. No different than the sports channels bidding on rights for the NFL, the Big East Network, etc.
I just think it makes sense to subsidize crappy channels people don't want. Why do you need 140 channels? Lots of useless crap out there that would people could switch to another channel for something similar. Yeah, there would be less competition since there would only be 30 channels, but the quality of each of those channels would be much higher I would think? If they put on crappy shows, people would drop them.
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Would AMC be able to create Madmen or Walking Dead without the safety net of guaranteed revenues from all the subscribers that pay into? Absolutely not. As a result, they wouldn't risk creating those types of high cost shows anymore. Makes no sense for them. They need to know what revenues they can count on in order to invest in the content risks they take in show development. No different than the sports channels bidding on rights for the NFL, the Big East Network, etc.
If there's a demand for Madmen or Walking Dead in the home entertainment market, then someone will figure out how to supply those shows to the public. You could be right that AMC wouldn't be able to create those programs... but HBO - or another channel that masters the pay-premium model - will. In other words, HBO has never had a safety net of guaranteed revenues, yet they seem to be doing just fine with cranking out hit programming and giving people a reason to subscribe (or maintain a subscription) to their channel. Shows like Madmen & Walking Dead will survive... shows like Toddlers & Tiaras and Extreme Couponing probably won't.
So Chicos... tell me which world you would rather live in: the one where Honey Boo Boo has a trust fund 10-20x greater than your annual earnings or the one where you expand your horizons in a new job?
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http://www.forbes.com/sites/mikeozanian/2013/05/14/senator-mccains-cable-tv-bill-targets-sports-fans-but-would-be-bad-for-everyone/?partner=yahootix
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McCain Pushes A La Carte Before Senate Panel; ESPN's Skipper Not Overly Concerned
Published May 15, 2013
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U.S. Sen. John McCain (R-Ariz.) yesterday told a Senate subcommittee that "Americans are at a 'tipping point' as it regards their monthly pay-TV bill and should be given the option of purchasing channels individually instead of as a bundle with hundreds of channels," according to Bob Fernandez of the PHILADELPHIA INQUIRER. McCain said, "I truly believe that a lot of Americans are fed up with their cable TV bills." McCain was trying to "rally support for the Television Consumer Freedom Act of 2013 that he proposed last week." McCain, who has "publicly supported a la carte for years, cited the soaring cost of sports programming and cable-bill inflation since the mid-1990s for the legislation." Former FCC Chair Michael Powell said that cable companies had "invested heavily in their networks and that the bundling of channels allows a diversity of programming that might not be supported if channels were sold individually" (PHILADELPHIA INQUIRER, 5/15).
SKIPPER FIRMLY AGAINST A LA CARTE: ESPN President John Skipper yesterday said that he "isn’t too worried" about McCain's proposed legislation. Skipper after the network's upfront presentation in N.Y. said, "We don't think the bill has any momentum." In L.A., Joe Flint notes Skipper's view that the legislation is a "long shot is shared by many television industry insiders." Skipper said that ESPN is priced "appropriately given the popularity of the channel." He added McCain is "dead wrong" on the issue. Skipper said that the cost for a family of four to go to dinner and a movie is "as much if not more than the cost of a monthly cable bill" (L.A. TIMES, 5/15). Skipper added, "ESPN is not a niche network and I'd like to meet some of these people who don't like ESPN. We have 115 million people a week who engage with ESPN Media … and we think we provide great value." He added the current cable package "provides great value." Skipper: "The average hour of television consumed in a pay television package is $0.23. That's a great value and a great story." A la carte programming "will not provide consumers with better choice or with better economics." The popularity of ESPN and other big networks "allows there to be a huge ecosystem of niche networks with diverse points of view and diverse product and those networks simply will not be able to exist in an a la carte universe" ("Bloomberg West," Bloomberg TV, 5/14).
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McCain Pushes A La Carte Before Senate Panel; ESPN's Skipper Not Overly Concerned
Published May 15, 2013
Font Size Resize Small Resize Normal Resize Large | Print | Share |
U.S. Sen. John McCain (R-Ariz.) yesterday told a Senate subcommittee that "Americans are at a 'tipping point' as it regards their monthly pay-TV bill and should be given the option of purchasing channels individually instead of as a bundle with hundreds of channels," according to Bob Fernandez of the PHILADELPHIA INQUIRER. McCain said, "I truly believe that a lot of Americans are fed up with their cable TV bills." McCain was trying to "rally support for the Television Consumer Freedom Act of 2013 that he proposed last week." McCain, who has "publicly supported a la carte for years, cited the soaring cost of sports programming and cable-bill inflation since the mid-1990s for the legislation." Former FCC Chair Michael Powell said that cable companies had "invested heavily in their networks and that the bundling of channels allows a diversity of programming that might not be supported if channels were sold individually" (PHILADELPHIA INQUIRER, 5/15).
SKIPPER FIRMLY AGAINST A LA CARTE: ESPN President John Skipper yesterday said that he "isn’t too worried" about McCain's proposed legislation. Skipper after the network's upfront presentation in N.Y. said, "We don't think the bill has any momentum." In L.A., Joe Flint notes Skipper's view that the legislation is a "long shot is shared by many television industry insiders." Skipper said that ESPN is priced "appropriately given the popularity of the channel." He added McCain is "dead wrong" on the issue. Skipper said that the cost for a family of four to go to dinner and a movie is "as much if not more than the cost of a monthly cable bill" (L.A. TIMES, 5/15). Skipper added, "ESPN is not a niche network and I'd like to meet some of these people who don't like ESPN. We have 115 million people a week who engage with ESPN Media … and we think we provide great value." He added the current cable package "provides great value." Skipper: "The average hour of television consumed in a pay television package is $0.23. That's a great value and a great story." A la carte programming "will not provide consumers with better choice or with better economics." The popularity of ESPN and other big networks "allows there to be a huge ecosystem of niche networks with diverse points of view and diverse product and those networks simply will not be able to exist in an a la carte universe" ("Bloomberg West," Bloomberg TV, 5/14).
Chicos,
Despite my monthly cable bill, you have me convinced this is a bad idea. Is there a middle road option in any of this? Other than the premium channels my cable company offers only 3 tiers. Can then offer 6 to 10? Or does that run into the same issue a la carte?
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Having the government push for this is the worst way to do it. The market is coming up with solutions all on its own. I think consumers will eventually demand this without any government interference, as the available consumer options already suggest.
McCain should take a break and get back to the D.C. cocktail circuit.
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The market is coming up with solutions all on its own. I think cConsumers will eventually are already demanding this without any government interference, as the available consumer options already suggest.
Fixed.
Having the government push for this is the worst way to do it.
Very true, provided the cable/sat companies i) don't stand in the way of those looking to adapt to new technologies and distribution models and ii) aren't colluding with content producers. But if you honestly think that Mickey Mouse is welcoming change and competition with open arms, then there's absolutely nothing anyone can say to change your mind.
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Fixed.
Very true, provided the cable/sat companies i) don't stand in the way of those looking to adapt to new technologies and distribution models and ii) aren't colluding with content producers. But if you honestly think that Mickey Mouse is welcoming change and competition with open arms, then there's absolutely nothing anyone can say to change your mind.
I agree with each of your points.
I think the things that will break the dam will be when entrepreneurial producers connect more directly with consumers, and existing/bigger content producers are forced to adapt. Isn't Netflix "hosting" shows or something? If things like this gain popularity, eventually the more traditional distributional channels will be forced to change.
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Would AMC be able to create Madmen or Walking Dead without the safety net of guaranteed revenues from all the subscribers that pay into? Absolutely not. As a result, they wouldn't risk creating those types of high cost shows anymore. Makes no sense for them. They need to know what revenues they can count on in order to invest in the content risks they take in show development. No different than the sports channels bidding on rights for the NFL, the Big East Network, etc.
So networks like AMC say subsidize us, give us your money up front and maybe will develop a show you'll like? And you, who when I last checked believed in free market capitalism, are OK with this? What's wrong with a hundred or more TV stations failing if nobody watches them? If AMC has some good ideas, find investors to back them - don't tell ESPN to foot the bill until (if) you produce a hit show.
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So networks like AMC say subsidize us, give us your money up front and maybe will develop a show you'll like? And you, who when I last checked believed in free market capitalism, are OK with this? What's wrong with a hundred or more TV stations failing if nobody watches them? If AMC has some good ideas, find investors to back them - don't tell ESPN to foot the bill until (if) you produce a hit show.
+1
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If there's a demand for Madmen or Walking Dead in the home entertainment market, then someone will figure out how to supply those shows to the public. You could be right that AMC wouldn't be able to create those programs... but HBO - or another channel that masters the pay-premium model - will. In other words, HBO has never had a safety net of guaranteed revenues, yet they seem to be doing just fine with cranking out hit programming and giving people a reason to subscribe (or maintain a subscription) to their channel. Shows like Madmen & Walking Dead will survive... shows like Toddlers & Tiaras and Extreme Couponing probably won't.
So Chicos... tell me which world you would rather live in: the one where Honey Boo Boo has a trust fund 10-20x greater than your annual earnings or the one where you expand your horizons in a new job?
Who is going to fund it Benny? Who is going to fund the creation of the next big show with no built in audience and sustained revenue to allow it to happen in the first place? This is what you guys continue to forget time and time again. You look at it POST hit, not development of shows. Most shows fail, but the revenues they can count on from these fees allows them to take risks to develop and create the shows to begin with. Without those guaranteed revenues, there will be many fewer risks taken and those shows will not be made. It's very simple. You aren't going to see huge bets made on a show that can't have a guaranteed revenue stream or guaranteed audience, the math doesn't work.
As long as the Dems are in power, this whole thing is a complete pipe dream. The creative types in Hollywood can't do their craft without the revenue that allows them to create. So its D.O.A. from the start. The sports leagues also will kill it. As I've said many times before, this isn't a technology issue, this is a content \ revenue \ creation issue. Way different than the music industry, the mistake people keep making and keep pounding their head into submission time and time again.
This is still years away, and there will be huge ramifications when it comes into play.
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Having the government push for this is the worst way to do it. The market is coming up with solutions all on its own. I think consumers will eventually demand this without any government interference, as the available consumer options already suggest.
McCain should take a break and get back to the D.C. cocktail circuit.
Consumers have demanded it...Canada is a test case and it's failing miserably. Look, the distributors like us would LOVE to have this a la carte, our CEO preaches it all the time. We would love to go to Viacom and say we will take MTV, and Nick and two other channels, but the other 7 you offer we don't want. Guess what happens when we try this? Viacom says you can have all 17 of our channels for $1 billion a year or you can have the four channels only you want for $999 million. Which do you prefer? As such, the distributors have to be able to recoup their costs so they have to bundle as well. The content companies refuse to break up the channel costs, and I've explained many reasons why they refuse to do so. ESPN needs the money to pay the NFL, NBA, college conferences. AMC needs it for content development, just as Fox, Viacom, etc do. Make it a la carte, and now the cost goes WAY up per channel, many channels disappear entirely because they are too niche (how is that going to fly with politicians when Black Entertainment goes away because of not enough subscribers...or Univision....or women's programming....etc, etc).
People don't understand what it means...it's a populist argument that people don't get. People don't realize the pipeline of new shows dries up, even MORE commercials will be added to subsidize for the revenue lost, channels will go away entirely, choice reduced, and costs rise. Sounds like a gov't idea to me.
McCain should retire.
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So networks like AMC say subsidize us, give us your money up front and maybe will develop a show you'll like? And you, who when I last checked believed in free market capitalism, are OK with this? What's wrong with a hundred or more TV stations failing if nobody watches them? If AMC has some good ideas, find investors to back them - don't tell ESPN to foot the bill until (if) you produce a hit show.
There is no such thing as a true free market, not in this country....you, of ALL people should know this. But let's keep playing along Lenny....guess what, Marquette you don't get any TV money anymore because Fox isn't going to give it to you because they won't get the fees from distributors to pay them. Guess what Chicago Bears, bye bye to all your television money...better yet, you only get the money if you win and people watch your broadcasts...no more equal sharing. Damn that socialism in tv and sports. Be careful what you wish for, you might just get it.
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Fixed.
Very true, provided the cable/sat companies i) don't stand in the way of those looking to adapt to new technologies and distribution models and ii) aren't colluding with content producers. But if you honestly think that Mickey Mouse is welcoming change and competition with open arms, then there's absolutely nothing anyone can say to change your mind.
Technology isn't the issue. Never has been, not sure how often I need to tell you this. Those other technology methods are being employed by the very same companies you suspect might be colluding.
If the content producers thought they could earn more money selling direct, they would do it. You are kidding yourself if you don't think that isn't the case. Cut out the middle man. The question becomes, do you want to do business with ESPN\Dinsey and cut them a check every month, and then one with CNN, and then one with FOX, and one with AMC, and one with Viacom, and then another check you write to Scripps because you can't get your Food Network, and then another check to Discovery. Good luck with that.....Disney, Time Warner, Viacom, Fox, etc, etc would do it in a second if they thought it would line their pockets. Distribution systems work for a reason, no different than why the music companies are largely in bed with Apple and others...the will do it if it makes sense. There's a reason why right now it doesn't make sense for many of the reasons I have laid out often. Someday it might, but the content providers need the money for this business model to create content or buy licensing etc. The mistake you and Lenny are making is trying to fit this into a traditional widget model, which absolutely isn't the case.
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Chicos,
Despite my monthly cable bill, you have me convinced this is a bad idea. Is there a middle road option in any of this? Other than the premium channels my cable company offers only 3 tiers. Can then offer 6 to 10? Or does that run into the same issue a la carte?
We've been trying...we opened up some new packages this past year. Here's the problem, many channels require a minimum penetration level of eyeballs, especially the sports channels. So if you add too many packages that don't include those core channels, you risk diluting the minimum pen rate requirements which are contractually required. We would love to not have to carry certain sports channels in every tier, but we can't avoid it presently. The sports channels need the dollars to pay the athletes so they demand huge subscription fees and the penetration to get advertising.
We've been aggressive not taking Pac 12 Network. We currently aren't taking Comcast Houston. These are the bets distributors are trying to take now to see if they do this, how many customers will they lose while fighting back against the pricing grab by the sports teams, but it comes at a cost. If you are a Rockets fan, you are going to get someone that gives you the Rockets in that case.
Many smart people trying to find a solution and they've been working on it for years. If it was obvious, it would have happened. Apple tried, and failed. Intel is trying right now and they are running into major problems.
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Consumers have demanded it...Canada is a test case and it's failing miserably. Look, the distributors like us would LOVE to have this a la carte, our CEO preaches it all the time. We would love to go to Viacom and say we will take MTV, and Nick and two other channels, but the other 7 you offer we don't want. Guess what happens when we try this? Viacom says you can have all 17 of our channels for $1 billion a year or you can have the four channels only you want for $999 million. Which do you prefer? As such, the distributors have to be able to recoup their costs so they have to bundle as well. The content companies refuse to break up the channel costs, and I've explained many reasons why they refuse to do so. ESPN needs the money to pay the NFL, NBA, college conferences. AMC needs it for content development, just as Fox, Viacom, etc do. Make it a la carte, and now the cost goes WAY up per channel, many channels disappear entirely because they are too niche (how is that going to fly with politicians when Black Entertainment goes away because of not enough subscribers...or Univision....or women's programming....etc, etc).
People don't understand what it means...it's a populist argument that people don't get. People don't realize the pipeline of new shows dries up, even MORE commercials will be added to subsidize for the revenue lost, channels will go away entirely, choice reduced, and costs rise. Sounds like a gov't idea to me.
McCain should retire.
I'll state again that I want no government part in any solution, so I hope we have that established.
I think this is going to happen whether content creators and distributors want it or not. Consumer just want it more and more, and eventually the financial incentive to do it will be too great to ignore. Eventually, too many people are going to want to see Game of Thrones without waiting for the DVD to come out or purchasing a package that carries HBO. I know I'm included in that group. I will absolutely grant you that that market may never expand. But I wouldn't be surprised to see it expand. And when it does, the entire existing TV infrastructure could collapse pretty quickly.
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Who is going to fund it Benny? Who is going to fund the creation of the next big show with no built in audience and sustained revenue to allow it to happen in the first place? This is what you guys continue to forget time and time again. You look at it POST hit, not development of shows. Most shows fail, but the revenues they can count on from these fees allows them to take risks to develop and create the shows to begin with. Without those guaranteed revenues, there will be many fewer risks taken and those shows will not be made. It's very simple. You aren't going to see huge bets made on a show that can't have a guaranteed revenue stream or guaranteed audience, the math doesn't work.
So what you're saying is that HBO didn't have to pony up any dough to produce The Sopranos until after season 1 was aired and it was declared a massive hit.
Bless you, James Gandolfini for working for free that first year.
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Let's think of it this way, because this is often the driver of costs.
When a NFL, NBA, NHL, or MLB player signs a multi-year contract are you paying him based on what he did or what he will do? The money (with the exception of the NFL) is guaranteed whether he totally dumps or plays great, but the money is coming regardless of performance. When a successful author signs to write some books, he is given a contract to produce X number of books. A director of movies, same thing. For many actors, same thing. This is different than most industries.
To pay for this stuff, revenues (guaranteed revenues) are coming from somewhere. To guarantee 5 year contracts for a baseball player they have to know what their revenues are going to be the next 5 years...the stable revenues. Those come from television. This is just one example, but where it all ties in. The same goes for Walking Dead or anything else along those lines. If a studio gets a hit with a show, their costs go up exponentially because the actors want more money, the producer, director, etc....so when they sign them to do X number of episodes over X number of seasons, they are doing this based on stable revenue sources. They cannot operate their businesses without these known revenues.
This is why sports, entertainment, etc do not want a la carte pricing. Of course the consumer does, but the consumer looks at it like every show is a hit, every series a home run, when the vast majority fail or never even get aired. All those failures still cost a tremendous amount of money to make. Without those "safety net" revenues in which to create content, there will be less content..a ton less. Without guaranteed television revenues, there won't be sports contracts that are guaranteed (maybe that's a good thing, but good luck getting it changed).
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I'm not sure why television "needs" to be different from every other industry.
If I want to buy a book from a particular publisher, I don't need to buy 9 crappy ones that I'm not interested in.
If I want to buy a salad at Panera, I don't need to buy their entire menu.
If I want to see a movie, I don't need to buy a slate of passes to half a dozen other movies that I'm not interested in.
If I want to buy a pair of jeans at Kohls, I don't need to buy eight other clothing items.
If a quality product exists, consumers will come. Same as every other industry. You find the money to support new projects either from your previous success or from VCs/bank loans/investors. Why would television be any different?
If consumers are already dumb enough to pay for full television packages, I guess I can see them continuing to shell out hundreds for satellite or Crime Warner, etc. As for myself, I'm in my late 20's and I can tell you that there will never be a moment in my life where I will purchase a standard television package as they exist today. Maybe the market for consumers like myself will never develop, maybe it will. Hard to tell.
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I absolutely love reading this thread.
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I'm not sure why television "needs" to be different from every other industry.
If I want to buy a book from a particular publisher, I don't need to buy 9 crappy ones that I'm not interested in.
If I want to buy a salad at Panera, I don't need to buy their entire menu.
If I want to see a movie, I don't need to buy a slate of passes to half a dozen other movies that I'm not interested in.
If I want to buy a pair of jeans at Kohls, I don't need to buy eight other clothing items.
If a quality product exists, consumers will come. Same as every other industry. You find the money to support new projects either from your previous success or from VCs/bank loans/investors. Why would television be any different?
If consumers are already dumb enough to pay for full television packages, I guess I can see them continuing to shell out hundreds for satellite or Crime Warner, etc. As for myself, I'm in my late 20's and I can tell you that there will never be a moment in my life where I will purchase a standard television package as they exist today. Maybe the market for consumers like myself will never develop, maybe it will. Hard to tell.
Well, I for one am pissed they don't offer a You Pick 3 or You Pick 1. I find it criminal that if I order a You Pick 2, they force me to take two items!!! Sometimes I just one, or I want 3!
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This is why sports, entertainment, etc do not want a la carte pricing. Of course the consumer does, but the consumer looks at it like every show is a hit, every series a home run, when the vast majority fail or never even get aired. All those failures still cost a tremendous amount of money to make. Without those "safety net" revenues in which to create content, there will be less content..a ton less. Without guaranteed television revenues, there won't be sports contracts that are guaranteed (maybe that's a good thing, but good luck getting it changed).
You're hilarious. We the consumer are not the rubes you think we are. We fully understand why TV content providers WANT their revenue guaranteed before (or whether) they produce anything worthwhile. They are crony capitalists/insider socialists (same difference) who want a free lunch - a rigged wheel. My advice to AMC? Find INVESTORS to help develop your content instead of asking for subsidies. How much content will we end up with? Exactly the amount that the market demands/wants. Defending these guys is no better than defending government subsidies for ethanol, Solyndra, etc., but I guess they're putting food on your table so that makes it OK.
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How much content will we end up with? Exactly the amount that the market demands/wants.
+1 - All that really needs to be said.
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You're hilarious. We the consumer are not the rubes you think we are. We fully understand why TV content providers WANT their revenue guaranteed before (or whether) they produce anything worthwhile. They are crony capitalists/insider socialists (same difference) who want a free lunch - a rigged wheel. My advice to AMC? Find INVESTORS to help develop your content instead of asking for subsidies. How much content will we end up with? Exactly the amount that the market demands/wants. Defending these guys is no better than defending government subsidies for ethanol, Solyndra, etc., but I guess they're putting food on your table so that makes it OK.
+1.
Chico's, you're a pretty political guy in other threads.
Everything you are saying here seems to go against your conservative viewpoint.
What's the deal?
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You're hilarious. We the consumer are not the rubes you think we are. We fully understand why TV content providers WANT their revenue guaranteed before (or whether) they produce anything worthwhile. They are crony capitalists/insider socialists (same difference) who want a free lunch - a rigged wheel. My advice to AMC? Find INVESTORS to help develop your content instead of asking for subsidies. How much content will we end up with? Exactly the amount that the market demands/wants. Defending these guys is no better than defending government subsidies for ethanol, Solyndra, etc., but I guess they're putting food on your table so that makes it OK.
Sounds to me then the answer is who can come up with the best model, i.e. we have a 20% success rate at producing hit television shows. And we know that from that 20% we get X number of dollars which fund the other 80% of the content that goes down the crapper. Question becomes who can identify and produce shows at a higher level than the competition and who allocates their money correctly, rather than throwing it at anything that moves and hoping it sticks.
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Question becomes who can identify and produce shows at a higher level than the competition and who allocates their money correctly, rather than throwing it at anything that moves and hoping it sticks.
This is right. The difference between the current television format and pretty much any other industry that has greater competition is that there seems to be less of a connection between producing a quality product and a direct response by consumers. McDonald's comes up with a new great product and people will come to McDonald's for that. AMC comes up with Breaking Bad and people like me sit around, still not having cable, and waiting for the next DVD set to come out. If the number of people sitting around waiting for current television shows to become available grows, eventually the financial incentive to reach out to them will be too great to resist.
Imagine if McDonald's came out with a great new burger, but said that if I want to have it now I have to purchase a stamp book of 12 value meals, a couple of which contain the new burger... or I can wait 12 months after its debut to buy it individually!
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+1.
Chico's, you're a pretty political guy in other threads.
Everything you are saying here seems to go against your conservative viewpoint.
What's the deal?
The deal is he works in the TV industry. Pretty obvious.
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Sounds to me then the answer is who can come up with the best model, i.e. we have a 20% success rate at producing hit television shows. And we know that from that 20% we get X number of dollars which fund the other 80% of the content that goes down the crapper. Question becomes who can identify and produce shows at a higher level than the competition and who allocates their money correctly, rather than throwing it at anything that moves and hoping it sticks.
Isn't this basically exactly what movie studios do?
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Isn't this basically exactly what movie studios do?
They produce content without subsidies or guarantees? And if they do a terrible job their investor base dries up and they go out of business? That's just plain mean.
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So what you're saying is that HBO didn't have to pony up any dough to produce The Sopranos until after season 1 was aired and it was declared a massive hit.
Bless you, James Gandolfini for working for free that first year.
Nope, didn't say that but they are also the exception to the rule. They are charging anywhere from $16 to $20 per month for their content. I know them very well, I'm responsible for all their revenue here. But Sopranos is hardly the only series they were having to pay for, many of which didn't do that well. Take a look at HBO from 2008 to 2011 and how much they were struggling for viewership, subscriptions, etc. Because of the backing they had with Time Warner at the time, they could get away with it. Many other channels cannot and they will not create the content as a result. The risk is too great.
You should also note, however, that Sopranos cost so much at the end to make because of the demands of the actors, etc, it was one of the reasons they called an end to the show. It ends up tapping so much on the cost side that they weren't able to effectively produce other shows for quite some time that could sustain the business.
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I'm not sure why television "needs" to be different from every other industry.
If I want to buy a book from a particular publisher, I don't need to buy 9 crappy ones that I'm not interested in.
If I want to buy a salad at Panera, I don't need to buy their entire menu.
If I want to see a movie, I don't need to buy a slate of passes to half a dozen other movies that I'm not interested in.
If I want to buy a pair of jeans at Kohls, I don't need to buy eight other clothing items.
If a quality product exists, consumers will come. Same as every other industry. You find the money to support new projects either from your previous success or from VCs/bank loans/investors. Why would television be any different?
If consumers are already dumb enough to pay for full television packages, I guess I can see them continuing to shell out hundreds for satellite or Crime Warner, etc. As for myself, I'm in my late 20's and I can tell you that there will never be a moment in my life where I will purchase a standard television package as they exist today. Maybe the market for consumers like myself will never develop, maybe it will. Hard to tell.
Think about what you are saying. Ridiculous examples. The jeans are mass produced...it's a widget. A television series is not mass produced, each show different, with different actors, sets, producers, writers, etc, etc. The jeans are the same thing, same machines making them...it's a widget. The salad is a widget. Your book example, actually you are paying more for certain books than others...why is that? Because Tom Clancy or whomever is getting paid in advance to produce certain books and that cost is built into what you pay. There's a reason why certain books are charged more than others, and isn't the page count.
Like I said, you can go a la carte, and the ramifications will be huge....Canada is learning this right now with backlash as a result. You'll pay a lot more for a lot less. It's simple economics. If you want to pay $20 for ESPN and $4 for Food Network, and $2 for DIY and $18 for HBO for a total of $44 for four channels...yup, you're saving money. Or you can spend about $85 for 150. Of course if you go with the former, many of those smaller, niche channels go bye bye. The revenues for ESPN dry up, less money for the Marquette's of the world, etc. It's simple economics.
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The deal is he works in the TV industry. Pretty obvious.
Actually, it's just common sense. I don't know why people make it so hard. These people don't work in the TV industry, and they are smart and figured it all out for themselves. Give it a try. ;)
This is from very liberal slate magazine, to conservative Bloomberg. It's COMMON SENSE and basic math. If you studied any math principles at all or any economics, this is a no brainer. Many of the articles here lay it out clearly. Has nothing to do with what I do, I just choose not to ignore the math...it doesn't lie.
http://www.slate.com/articles/business/moneybox/2013/05/mccain_s_la_carte_cable_bill_is_bad_deal_for_consumers.html
http://variety.com/2013/biz/news/a-la-carte-tv-will-never-be-1200410243/
http://go.bloomberg.com/tech-blog/2013-01-31-your-cable-bills-going-up-again-but-forget-a-la-carte-pricing/
http://www.bloomberg.com/video/why-cable-la-carte-pricing-will-never-happen-RRn3sCquSfOrQmCsDG7XEQ.html
http://www.twcableuntangled.com/2011/06/a-good-argument-against-a-la-carte-pricing/
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+1.
Chico's, you're a pretty political guy in other threads.
Everything you are saying here seems to go against your conservative viewpoint.
What's the deal?
I prefer the liberartian POV for most things, so get gov't out of the way. Call that conservative or libertarian, I think it's the right play. Now, saying that, yeah there is socialist principles in play here just as there are for many industries. No such thing as a pure play and no such thing as a true free market. The question there is how free is it going to be? Hards will have one view that is a heck of a lot different than mine.
I've copied many articles here...it's Math 101....that's why it surprises me greatly that Lenny, who is mathematically competent as well economically versed, doesn't spend 5 minutes to educate himself and figure it all out. It's not hard, he's a smart guy but on this topic he actually does come across as a rube which is odd. I had more faith in him.
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Isn't this basically exactly what movie studios do?
Not anywhere close to the scale. One TV show typically lasts 13 weeks for one hour per show, on average. Now multiply that by all the hours of programming you need in a single day, multiplied by all the channels out there. Far far far far far far far fewer movies are made than television shows. Thus the hits for success or failure are far different. Even saying that, think about how many movies go directly to DVD...you would be stunned. TV and movies, different animal though the cross pollinate in some areas because of the medium, but the business model is different because the amount of content needed.
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+1.
Chico's, you're a pretty political guy in other threads.
Everything you are saying here seems to go against your conservative viewpoint.
What's the deal?
Conservative idealist until it potentially affects him negatively in any way. Fairly common.
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Conservative idealist until it potentially affects him negatively in any way. Fairly common.
LOL.
It doesn't effect me at all. If you look at what I wrote, I would LOVE to sell this stuff a la carte. Our CEO, CFO, pretty much every distributor is saying the same thing. We would do it in a second. I'm telling you why it won't happen...because of the content providers (Disney, Fox, Viacom, Discovery, etc, etc, etc). I'm not against it, I'm telling you why they won't and some of it is legit, like creating content our securing sports fees.
Maybe the IRS can fix it for us.
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Far far far far far far far fewer movies are made than television shows.
Hmm.. Maybe if you took into account every television station and every time slot available to them. But what about top 4/5 movie studios vs. top 4/5 watched TV stations? I'm betting the number of shows those TV stations (i'd assume it's Fox, ABC, CBS, NBC, ESPN.. just guessing) developed/started per year are pretty close to the total number of movies produced/developed per year of the movie studios.
And the "direct to DVD" amount is the equivalent of a 1 season or less TV show. And again, I'd assume there's more direct to DVD movies made (and the production cost higher) than TV series that bottom-out after a season.
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Hmm.. Maybe if you took into account every television station and every time slot available to them. But what about top 4/5 movie studios vs. top 4/5 watched TV stations? I'm betting the number of shows those TV stations (i'd assume it's Fox, ABC, CBS, NBC, ESPN.. just guessing) developed/started per year are pretty close to the total number of movies produced/developed per year of the movie studios.
And the "direct to DVD" amount is the equivalent of a 1 season or less TV show. And again, I'd assume there's more direct to DVD movies made (and the production cost higher) than TV series that bottom-out after a season.
Even there it's an apples to oranges scenario because of the windowed releases. Here's what I mean.
For a studio movie it has six life cycle ways it is monetized.
1) Released to the movie theatres (window 1)
2) After window 1, it is released to DVD (window 2)
3) Window 3 it is sold as pay per view or EST (electronic sell through) on services like Directv, Dish, Apple TV, Xbox, PS3, Netflix
4) Window 4 is the premium window and usually happens about 9 months to 24 months after window 1. The premium window is when it appears on Starz or HBO or Epix or Showtime. This is an exclusive window.
5) Window 5 comes after the Premium window is closed and it can then appear as library content (non-exclusive) where it might be on any number of premium plex channels
6) The last window is where broadcast or cable channels like FX, Fox Movie Channel, TNT, etc buy the rights to have it played with commercials...this is typically many years after Window 1
In each of these lifecycle stages, that product earns revenue. Now, not all films hit all six. Some go directly to window 2 and may stop at window 5.
For TV episodes, they are lucky if they can monetize past seasons on DVD or through Hulu \ Netflix, but it is much rarer. This is why the TV side of the house has so much of a harder time with hits and misses. They can focus test the heck out of the pilots, have all the research in the world and it can do great but 2 or 3 weeks in, bombs and that entire investment is gone. This is why the studios won't be changing anything anytime soon in my opinion.
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Even there it's an apples to oranges scenario because of the windowed releases. Here's what I mean.
For a studio movie it has six life cycle ways it is monetized.
1) Released to the movie theatres (window 1)
2) After window 1, it is released to DVD (window 2)
3) Window 3 it is sold as pay per view or EST (electronic sell through) on services like Directv, Dish, Apple TV, Xbox, PS3, Netflix
4) Window 4 is the premium window and usually happens about 9 months to 24 months after window 1. The premium window is when it appears on Starz or HBO or Epix or Showtime. This is an exclusive window.
5) Window 5 comes after the Premium window is closed and it can then appear as library content (non-exclusive) where it might be on any number of premium plex channels
6) The last window is where broadcast or cable channels like FX, Fox Movie Channel, TNT, etc buy the rights to have it played with commercials...this is typically many years after Window 1
In each of these lifecycle stages, that product earns revenue. Now, not all films hit all six. Some go directly to window 2 and may stop at window 5.
For TV episodes, they are lucky if they can monetize past seasons on DVD or through Hulu \ Netflix, but it is much rarer. This is why the TV side of the house has so much of a harder time with hits and misses. They can focus test the heck out of the pilots, have all the research in the world and it can do great but 2 or 3 weeks in, bombs and that entire investment is gone. This is why the studios won't be changing anything anytime soon in my opinion.
I understand what you are saying. And agree with this post.
However, my post was in response to yours saying that there are fewer movies released compared to TV shows. This current post of yours does nothing to refute mine. I believe that there are as many, if not more, movies released compared to TV shows. This current post of yours shows nothing to deny that.
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I understand what you are saying. And agree with this post.
However, my post was in response to yours saying that there are fewer movies released compared to TV shows. This current post of yours does nothing to refute mine. I believe that there are as many, if not more, movies released compared to TV shows. This current post of yours shows nothing to deny that.
I was trying to track down the information. 677 movies were released in 2012 according to the MPAA. I'm trying to track down the number of shows.
EDIT: I was told today it would be more than 10,000 shows for television per year. Each show is unique and you have things like Ellen that does 250 unique shows a year on just one channel. Many shows like. Most series are 13 episodes. Etc, etc. The news operations alone put out out thousands of newly created shows constantly (every day). All come with a cost for writers, producers, etc, etc.
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LOL.
It doesn't effect me at all. If you look at what I wrote, I would LOVE to sell this stuff a la carte. Our CEO, CFO, pretty much every distributor is saying the same thing. We would do it in a second. I'm telling you why it won't happen...because of the content providers (Disney, Fox, Viacom, Discovery, etc, etc, etc). I'm not against it, I'm telling you why they won't and some of it is legit, like creating content our securing sports fees.
Maybe the IRS can fix it for us.
So if you want this to happen, why aren't you, your CEO, your CFO, and pretty much every distributor lobbying and backing McCain's bill? Heck... you guys have a voice and an outlet to reach the exact audience who are the grass roots for this bill - cable/sat subscribers. Yet you're bellyaching over the voodoo economics of the entertainment biz that is obviously being crammed down your throat. If you support this measure, why are you papering us with the other side's propaganda.
So it begs the question... why are you so afraid of a little mouse?
(http://www.behindthehype.com/wp-content/uploads/2009/03/mouse21.jpg)
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So if you want this to happen, why aren't you, your CEO, your CFO, and pretty much every distributor lobbying and backing McCain's bill? Heck... you guys have a voice and an outlet to reach the exact audience who are the grass roots for this bill - cable/sat subscribers. Yet you're bellyaching over the voodoo economics of the entertainment biz that is obviously being crammed down your throat. If you support this measure, why are you papering us with the other side's propaganda.
So it begs the question... why are you so afraid of a little mouse?
(http://www.behindthehype.com/wp-content/uploads/2009/03/mouse21.jpg)
+1. No matter how much fuzzy math conglomerates cram down our throats trying to convince us that in their unique (LOL) circumstance as little competition and choice as possible is in the consumer's best interest, I'm not buying it.
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Think about what you are saying. Ridiculous examples. The jeans are mass produced...it's a widget. A television series is not mass produced, each show different, with different actors, sets, producers, writers, etc, etc. The jeans are the same thing, same machines making them...it's a widget. The salad is a widget. Your book example, actually you are paying more for certain books than others...why is that? Because Tom Clancy or whomever is getting paid in advance to produce certain books and that cost is built into what you pay. There's a reason why certain books are charged more than others, and isn't the page count.
Like I said, you can go a la carte, and the ramifications will be huge....Canada is learning this right now with backlash as a result. You'll pay a lot more for a lot less. It's simple economics. If you want to pay $20 for ESPN and $4 for Food Network, and $2 for DIY and $18 for HBO for a total of $44 for four channels...yup, you're saving money. Or you can spend about $85 for 150. Of course if you go with the former, many of those smaller, niche channels go bye bye. The revenues for ESPN dry up, less money for the Marquette's of the world, etc. It's simple economics.
You've just admitted that I'm right with the purchase of a book. Thank you.
It doesn't have to be different with television. You just want it to be different so that consumers are forced to pay for more white trash garbage like the duck call and swamp shows. I, for one, am tuned out until your AT&T wannabe industry gets de-monopolized by market forces.
More options are always better. Welcome to market economics.
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You should also note, however, that Sopranos cost so much at the end to make because of the demands of the actors, etc, it was one of the reasons they called an end to the show. It ends up tapping so much on the cost side that they weren't able to effectively produce other shows for quite some time that could sustain the business.
I weep for the actors on the Sopranos.
But, really, if this is true it sounds like another successful market clearing operation. If consumers don't want to pay for a show, it won't come into existence. If they do, it will. If consumers want something to stay available, they'll pay for it. Something is only financially worth what people will pay for it.
Same with any other "widget" you can buy at Target.
At the end of the day, there is a lot of garbage on television, and a lot of the people behind the scenes are making a lot more money than consumers would pay if (and when) more options became available. Soon, they will. And, soon, the quality of the average entertainment option will probably increase because people just won't pay for all the excess.
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So if you want this to happen, why aren't you, your CEO, your CFO, and pretty much every distributor lobbying and backing McCain's bill? Heck... you guys have a voice and an outlet to reach the exact audience who are the grass roots for this bill - cable/sat subscribers. Yet you're bellyaching over the voodoo economics of the entertainment biz that is obviously being crammed down your throat. If you support this measure, why are you papering us with the other side's propaganda.
So it begs the question... why are you so afraid of a little mouse?
(http://www.behindthehype.com/wp-content/uploads/2009/03/mouse21.jpg)
And do you know if they aren't backing it? In the past 5 years I've seen probably 10 different Senators come through here, many reps, many state reps, etc. Part of the problem may be that what he is suggesting to do isn't very good legislation (gasp, how could that be coming from the beauties in Washington...I'll probably get an audit for saying that). Distributors say all the time they want to put certain programming on a specific tier...Pac 12 we've been saying it from day one. Comcast Houston. Verizon saying the same thing. It's out there.
I'm telling you how it is and who has the control...it's the content providers (media companies, sports leagues, etc). I'm here trying to explain the realities of what goes on. We got into a very public dispute with Viacom last year that got to the point Jon Stewart had it on his nightly opening for several days. We try to take on these guys when it makes sense to do so, but they're also partners as well. Not all of them act in the same manner.
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I weep for the actors on the Sopranos.
But, really, if this is true it sounds like another successful market clearing operation. If consumers don't want to pay for a show, it won't come into existence. If they do, it will. If consumers want something to stay available, they'll pay for it. Something is only financially worth what people will pay for it.
Same with any other "widget" you can buy at Target.
At the end of the day, there is a lot of garbage on television, and a lot of the people behind the scenes are making a lot more money than consumers would pay if (and when) more options became available. Soon, they will. And, soon, the quality of the average entertainment option will probably increase because people just won't pay for all the excess.
Warrior....where would you like to take it?
How about, you order ESPN but you only pay for the football game you want, not SportsCenter and not the women's softball championship. I hate the NBA, so I shouldn't have to pay for the NBA games on ESPN. See where this is going?
This isn't a widget business and the cost to produce a book is nowhere on planet earth close. We'll see what "soon" happens. I've been hearing about it for 7 or 8 years now, from many on this board that it was next year, next year, next year. I have no doubt someday it will, but I truly think many of you have no idea what it takes to produce content but you want to compare it to getting a salad, or blue jeans, or buying a book. Uhm, ok.
Duck Dynasty....funny show. One person's garbage is another person's treasure.
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Chicos,
I'm not saying when or even if the system will change. The powerful (team owners, player unions, content providers and content deliverers) have a rigged wheel and they'll fight tooth and nail to keep it that way. And since this system puts food on your table I think it's normal to try to rationalize or excuse their behavior. But...and it's a big but....can you honestly, in your libertarian heart of hearts, tell me that free market principles should apply and are effective in every industry but your own? That for some bizarre reason less competition and fewer choices for consumers are good things in the television industry when they're anathema everywhere else? C'mon, man
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Chicos,
I'm not saying when or even if the system will change. The powerful (team owners, player unions, content providers and content deliverers) have a rigged wheel and they'll fight tooth and nail to keep it that way. And since this system puts food on your table I think it's normal to try to rationalize or excuse their behavior. But...and it's a big but....can you honestly, in your libertarian heart of hearts, tell me that free market principles should apply and are effective in every industry but your own? That for some bizarre reason less competition and fewer choices for consumers are good things in the television industry when they're anathema everywhere else? C'mon, man
Ironically, the stuff I'm in charge of is a la carte (sports packages, HBO, etc) so I'm already operating in that world and have for many years.
Free market principles don't apply in many industries, that's what I've said from the get go. There is no such thing as a free market. Every industry is regulated in some fashion....every industry. Utilities, insurance, food, healthcare, etc, etc. All are heavily regulated and are not true free markets in the purist sense. But, I certainly agree with you that some are more free than others and I suspect that's what you are getting at.
And to answer your question, yes, I do think some industries should not work under a free market principle because of the nature of their business. I think sports is one area. I absolutely believe in a cap, a hard cap in which all teams have the same amount to work with in terms of salaries. That isn't free market, but when talent is so hard to find in that type of business, I do think it should be the case.
I will again point to Canada that is going the a la carte model and now when they finally see what it is doing, they want out of it. This is one of those classic "you have the pass the bill to see what's in it" moments. The law of unintended consequences. I think there is value in something like Black Entertainment Television, but if it was a purely a model based on consumption it would not exist. There are many other channels in the same vein, where if it wasn't for pooled revenues they wouldn't exist. Some of these channels serve a niche audience, or a minority audience, but could not stand on their own. This is one of the benefits of the system.
Let's face it, there is bundling everywhere. Marquette is part of a bundle. Their power is limited on their own, but as a collective with the Big East schools they can use that power to get television deals, etc. If I go to a grocery store and want to buy one hot dog bun, I can't...I need to buy 8 buns and pay for all 8 even if I'm going to use 1. I can buy one can of soda for $.50 or I can buy a 6 pack for $2.15. There are examples all over the place where we "tolerate" bundling that doesn't even benefit us that much. With television (or radio...see Sirius XM), you are also benefiting niche audiences that could not do so on their own without it. So yes, in some cases I do support it. In many cases I do not. It depends what it is. Should I have to fly gov't airlines? No. Does society benefit? Unlikely. Should we have a system where channels like PBS, BET, Smithsonian Channel, etc are available for a low cost and included in a bundle....I don't have an issue with that. Should all customers have to pay for sports programming...I don't think so (see, I'm pro a-la carte here). So it depends what it is.
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On point
Pac 12 http://zonazealots.com/2013/05/17/larry-scott-pac-12-network-miserably-failing-expectations/
CSN Houston http://blog.chron.com/sportsmedia/2013/05/csn-houston-faces-tough-decisions-due-to-financial-strains-crane-says/
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If I go to a grocery store and want to buy one hot dog bun, I can't...I need to buy 8 buns and pay for all 8 even if I'm going to use 1. I can buy one can of soda for $.50 or I can buy a 6 pack for $2.15. There are examples all over the place where we "tolerate" bundling that doesn't even benefit us that much. With television (or radio...see Sirius XM), you are also benefiting niche audiences that could not do so on their own without it.
"Bundling" is not the same as "buying in bulk." If you buy a six-pack of Coke... even if you only drink five, you are merely buying excess of something you need. If the only six-packs of Coke you can buy are in a "bundle" that contains four Cokes and two Diet Cokes and you're phenylketonuric, the difference is that with the former, you have an opportunity to fully utilize your purchase; however with the latter, you are being forced to pay for something you can never utilize just to get to a product you want.
I'm sorry, but that concept reeks of anti-trust... and frankly, that's exactly where the gov't needs to step in.
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If Coke only sold six packs, they would go out of business. Eventually, competitors are going to step into the market to such an extent that brands like Disney will be forced to offer more options for their product. The process might take 10-15 years, but the companies that do not diversify will not survive.
I hope you are not arguing that the government should protect existing entertainment monopolies with your comment about the free market not applying to the industry. The laws of economics apply to any industry whether they want it or not. I think you will admit that those laws are pointing to eventual change.
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"Bundling" is not the same as "buying in bulk." If you buy a six-pack of Coke... even if you only drink five, you are merely buying excess of something you need. If the only six-packs of Coke you can buy are in a "bundle" that contains four Cokes and two Diet Cokes and you're phenylketonuric, the difference is that with the former, you have an opportunity to fully utilize your purchase; however with the latter, you are being forced to pay for something you can never utilize just to get to a product you want.
I'm sorry, but that concept reeks of anti-trust... and frankly, that's exactly where the gov't needs to step in.
Your soda example you have to think about pricing. Coke will gladly sell you one can at a time, but a .75 apiece, while you can buy 12 cokes for around .35 apiece. So should Coke be forced to price every can at the same price regardless of quantity because it's not fair to charge different prices for when you buy different quantities? And sure, if you want to create your six pack of soda, you will pay a premium.
So while cable a la cart pricing sounds great in theory, I would be curious to see in reality. And while folks cry monopoly with cable billing, no one is forcing you to buy cable right now...these are companies, and yes of course I want my cable bill to go down (and Chicos your local sports charges are still BS ;)
but at the end of the day I think they are primarily motivated by $, but they still have to look out for the best interest of their millions of customers because as soon as our countries internet infrastructure is upgraded that can efficiently deliver, download, and store HD content, more and more folks will unplug the cable box.
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Your soda example you have to think about pricing. Coke will gladly sell you one can at a time, but a .75 apiece, while you can buy 12 cokes for around .35 apiece. So should Coke be forced to price every can at the same price regardless of quantity because it's not fair to charge different prices for when you buy different quantities? And sure, if you want to create your six pack of soda, you will pay a premium.
Of course ala carte pricing will be higher per unit, but sometime you just want an order of fries and not the #4 so you don't mind paying a premium for that choice. Nobody is suggesting that cable companies shouldn't be able to charge a premium to customers who want to pick and choose or that bulk buying (bundling) shouldn't result in a discount. We just don't want those choices dictated to us.
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Of course ala carte pricing will be higher per unit, but sometime you just want an order of fries and not the #4 so you don't mind paying a premium for that choice. Nobody is suggesting that cable companies shouldn't be able to charge a premium to customers who want to pick and choose or that bulk buying (bundling) shouldn't result in a discount. We just don't want those choices dictated to us.
Fair enough, good points.
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I think there is value in something like Black Entertainment Television, but if it was a purely a model based on consumption it would not exist. There are many other channels in the same vein, where if it wasn't for pooled revenues they wouldn't exist. Some of these channels serve a niche audience, or a minority audience, but could not stand on their own. This is one of the benefits of the system.
So because YOU, in your infinite wisdom, have decided that some stations deserve to be aired regardless of their economic feasibility YOU want to force your customers to pay for them? So eliminating competition and picking winners is OK as long as we have really smart, good guys like yourself in charge of that? The unintended consequences of that line of thinking are infinitely more dangerous than letting failing networks fail.
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If Coke only sold six packs, they would go out of business. Eventually, competitors are going to step into the market to such an extent that brands like Disney will be forced to offer more options for their product. The process might take 10-15 years, but the companies that do not diversify will not survive.
I hope you are not arguing that the government should protect existing entertainment monopolies with your comment about the free market not applying to the industry. The laws of economics apply to any industry whether they want it or not. I think you will admit that those laws are pointing to eventual change.
Bingo.
Eventually, the free market and technology are going to bust up the current model.
Outside of live events, there is no need to "broadcast". You can just have a "release date", and consumers can intake on their own time.
I don't think McCain really needs to get involved. Let the guys from google or facebook figure it out. Once they do, the current delivery model will die on the vine.
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Chicos, you should probably be encouraged that McCain is getting involved. As surefire a way to guarantee that it won't work as probably exists. We could get bundling for the next 150 years.
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If Coke only sold six packs, they would go out of business. Eventually, competitors are going to step into the market to such an extent that brands like Disney will be forced to offer more options for their product. The process might take 10-15 years, but the companies that do not diversify will not survive.
I hope you are not arguing that the government should protect existing entertainment monopolies with your comment about the free market not applying to the industry. The laws of economics apply to any industry whether they want it or not. I think you will admit that those laws are pointing to eventual change.
I'm saying there are some industries that produce things that benefit some groups which could not survive without subsidization. In this case, a number of tv channels serve some niche groups but not the masses. Is it important for those channels to exist? Today they do because everyone pays a little bit for them. Take that away, they go away. Now, whether that is a good thing or not, I don't know but I suspect a number of lawmakers will have their pet channels for certain constituencies that they don't want to see go. We'll see how it shakes out. On the sports side, like I've said...be careful what you wish for because the first entities to go bye bye forever will be those like Marquette. Sports rights are doable today because 90% of folks are paying them even if only 30% or whatever watch. If that becomes a la carte, only the cream of the crop will get any dollars of any magnitude.
Disney is already doing it as is everyone else, but they are going to do it in a way that makes economic sense for them which includes development of product. This is where your argument that you keep going back to (and others) falls apart. You want to make comparisons to buying a book to a tv show (let's see...one author writes a book and then you have printing \ publishing, distribution. Now compare that to creating a tv show...writers, producers, director, actors, cameramen, technology folks, editing, distribution, etc). It's a totally different animal. They survive on successful series. For every American Idol or 24 or 60 Minutes there are carcasses everywhere of failed programming. It's a totally different animal and if they cannot monetize for the risks they are taking in content development, they won't do it.
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Chicos, you should probably be encouraged that McCain is getting involved. As surefire a way to guarantee that it won't work as probably exists. We could get bundling for the next 150 years.
He's an American patriot, good guy, but there are things that all these guys and gals get into that they don't understand and the harmful effects or byproducts are what we are left with. The destruction of the General Aviation industry in this country is totally at their feet. There are so many others.
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Of course ala carte pricing will be higher per unit, but sometime you just want an order of fries and not the #4 so you don't mind paying a premium for that choice. Nobody is suggesting that cable companies shouldn't be able to charge a premium to customers who want to pick and choose or that bulk buying (bundling) shouldn't result in a discount. We just don't want those choices dictated to us.
Yup, but producing fries and producing television shows are a lot different. Producing almost anything compared to a television show or movie is wildly different, thus the different economic principles in play.
Look, I realize you don't like it. I know you want to take a few swipes at me, that's fine. I'm just trying to give you the realities of the situation having been in this business on multiple sides of the fence (from the Television and Radio Exec Producer for MU, or working those gigs for the Angels and Ducks, to being on the distributor side and working with these studios and content providers for more than a decade). Changes will continue to happen on the margins, but you have to find a way for them to be able to monetize their risk. You can say that's my INFINITE WISDOM or whatever crack you made, or you can go to any of the highly educated sources I have given to you or read others at the Wall Street Journal, Forbes, Multichannel News, sports executive commentary, etc, etc. Don't take my word for it.
I know Apple and HBO are going to do a deal for example, but I also know it will be through authentication which means you have to be a television subscriber. The technology is there, it's the revenue streams that they are guaranteed by the distributors that cannot be supplanted at this time which is why it is in this current model. If the media companies could get the same billions directly from consumers, they would do it. Some day they likely will.
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Your soda example you have to think about pricing. Coke will gladly sell you one can at a time, but a .75 apiece, while you can buy 12 cokes for around .35 apiece. So should Coke be forced to price every can at the same price regardless of quantity because it's not fair to charge different prices for when you buy different quantities? And sure, if you want to create your six pack of soda, you will pay a premium.
So while cable a la cart pricing sounds great in theory, I would be curious to see in reality. And while folks cry monopoly with cable billing, no one is forcing you to buy cable right now...these are companies, and yes of course I want my cable bill to go down (and Chicos your local sports charges are still BS ;)
but at the end of the day I think they are primarily motivated by $, but they still have to look out for the best interest of their millions of customers because as soon as our countries internet infrastructure is upgraded that can efficiently deliver, download, and store HD content, more and more folks will unplug the cable box.
The irony is if we were to charge you the true local sports cost in your area you would really scream. We are charging $2 or $3 when some RSN costs in some DMAs is north of 6X higher.
Take a DMA like New York with YES, SNY, MSG, MSG+....all RSNs, all carrying a different pro team and all charging a ton of money to a distributor. Los Angeles very similar. What happens when a distributor doesn't carry that content....fans leave and go somewhere else that has it. Tough spot to be in which is why we have requested to only offer those sports services to customers that actually watch sports. You can imagine what the teams said.
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I'm saying there are some industries that produce things that benefit some groups which could not survive without subsidization. In this case, a number of tv channels serve some niche groups but not the masses. Is it important for those channels to exist? Today they do because everyone pays a little bit for them. Take that away, they go away. Now, whether that is a good thing or not, I don't know but I suspect a number of lawmakers will have their pet channels for certain constituencies that they don't want to see go. We'll see how it shakes out. On the sports side, like I've said...be careful what you wish for because the first entities to go bye bye forever will be those like Marquette. Sports rights are doable today because 90% of folks are paying them even if only 30% or whatever watch. If that becomes a la carte, only the cream of the crop will get any dollars of any magnitude.
Disney is already doing it as is everyone else, but they are going to do it in a way that makes economic sense for them which includes development of product. This is where your argument that you keep going back to (and others) falls apart. You want to make comparisons to buying a book to a tv show (let's see...one author writes a book and then you have printing \ publishing, distribution. Now compare that to creating a tv show...writers, producers, director, actors, cameramen, technology folks, editing, distribution, etc). It's a totally different animal. They survive on successful series. For every American Idol or 24 or 60 Minutes there are carcasses everywhere of failed programming. It's a totally different animal and if they cannot monetize for the risks they are taking in content development, they won't do it.
I don't disagree with any of this. I think there will be a lot less content around when the market moves television away from the current business model. For me, I just do not care about what will be left off. And, I think if these programs cannot survive on their own, the same way that other business' products are almost all expected to have positive ROI, the consumers don't care either.
The one thing I would possibly care about, of course, are the sports programs I care about (all two of them). But, if the market can't support them, I can't say I wasn't warned.
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The news out of ESPN today....those rights fees cost a LOT of money. Several friends impacted by this. Despite posting profits, the margins not good enough. Many ESPN deals are up in the next two years with distributors and the cost for ESPN (already highest of all widely distributed cable channels) will go even higher.
http://deadspin.com/source-espn-laying-off-hundreds-509043249
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The news out of ESPN today....those rights fees cost a LOT of money. Several friends impacted by this. Despite posting profits, the margins not good enough. Many ESPN deals are up in the next two years with distributors and the cost for ESPN (already highest of all widely distributed cable channels) will go even higher.
http://deadspin.com/source-espn-laying-off-hundreds-509043249
Same thing is going on with my company... record profit each quarter, but they are cutting staff like crazy. Gotta feed that earnings report beast, I guess. Long live Bernanke and the Dow Jones Industrial Average.
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The news out of ESPN today....those rights fees cost a LOT of money. Several friends impacted by this. Despite posting profits, the margins not good enough. Many ESPN deals are up in the next two years with distributors and the cost for ESPN (already highest of all widely distributed cable channels) will go even higher.
http://deadspin.com/source-espn-laying-off-hundreds-509043249
The demand isn't inelastic.
Eventually, people will just tune out and spend their time/money elsewhere.
Now, that doesn't mean ESPN or cable companies are going to fail next year... but it does open up the marketplace for a cheaper/different entertainment/content options.
ESPN will keep cranking it up, and consumers will keep paying... right up until they don't.
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The news out of ESPN today....those rights fees cost a LOT of money. Several friends impacted by this. Despite posting profits, the margins not good enough. Many ESPN deals are up in the next two years with distributors and the cost for ESPN (already highest of all widely distributed cable channels) will go even higher.
http://deadspin.com/source-espn-laying-off-hundreds-509043249
Money isn't everything, Mortimer.
- Oh, grow up.
Mother always said you were greedy.
- She meant it as a compliment.
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The news out of ESPN today....those rights fees cost a LOT of money. Several friends impacted by this. Despite posting profits, the margins not good enough. Many ESPN deals are up in the next two years with distributors and the cost for ESPN (already highest of all widely distributed cable channels) will go even higher.
http://deadspin.com/source-espn-laying-off-hundreds-509043249
Chicos you are a smart business guy. What you are listing above indicates that ESPN is being poorly run. They are spending more on rights, with the only hope being to charge more and more for their product. In a climate fighting against these rising costs, they should not continue paying a premium for the content. If cable companies balk at the increase in costs, because they are afraid to lose customers, ESPN would be left holding the bill. Seems like they should have more foresight into shifting economic climates.
Really opens the door for a new company like Fox.
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Yup, but producing fries and producing television shows are a lot different. Producing almost anything compared to a television show or movie is wildly different, thus the different economic principles in play.
There are some very smart people who have tried to convince me for years that competition and choices are unimportant in health care because it is "different". You are a very smart person trying to tell me the same thing about television. It's what people looking to establish a monopoly or protect one reflexively say. I disagree in both cases.
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The news out of ESPN today....those rights fees cost a LOT of money. Several friends impacted by this. Despite posting profits, the margins not good enough. Many ESPN deals are up in the next two years with distributors and the cost for ESPN (already highest of all widely distributed cable channels) will go even higher.
http://deadspin.com/source-espn-laying-off-hundreds-509043249
I worked with Dirk Ziff on investments in ASEAN. I have also worked with Disney, a Ziff holding. Disney is a nasty, cut-throat organization. A lot of the blame for that culture rests with Eisner but the Ziffs are demanding SOBs and helped set the bar which Eisner had to hurdle. I have not worked with ESPN but I would guess a lot of the Ziff/Eisner culture is at play in CT. If so then high expectations for return, limited patience, and bone jarring layoffs are par for the course.
GE Cap and Ziff took positions in several companies when Ziff first started investing in SE Asia. They don't just want seats on the board but like to insert people into line positions. This is great in theory but a bull headed, loud, arrogant, culturally insensitive New Yorker in a 300 year old Chinese family enterprise in Jakarta is a recipe for disaster. Throw in the fact that in one case the obnoxious New Yorker was Jewish, in the world's largest Moslem country, and the disaster turned into a meltdown.
Dirk Ziff is an HBS grad but he was completely ignorant about living and working in Asia. Seeing their expectations first hand I could not imagine being subordinated to them. I am certain much of what is happening in CT is attributable to the Eisner culture cultivated in the mid-90's. It is mercenary, audacious, and contemptuous. Customers are seen as mice who will pay whatever fare Disney dictates. That usually works well in monopolistic verticals but is not sustainable with the introduction of competition. God bless Mr. Murdoch.
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There are some very smart people who have tried to convince me for years that competition and choices are unimportant in health care because it is "different". You are a very smart person trying to tell me the same thing about television. It's what people looking to establish a monopoly or protect one reflexively say. I disagree in both cases.
Agreed.
I know TV is different than tomato soup, but at the end of the day, the basic economics of any good or service are the same.
We can dress it up however we want, but the principles of supply and demand are always at the core. The demand for content and entertainment isn't inelastic. At some point people will tune out and/or find alternatives.
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Agreed.
I know TV is different than tomato soup, but at the end of the day, the basic economics of any good or service are the same.
We can dress it up however we want, but the principles of supply and demand are always at the core. The demand for content and entertainment isn't inelastic. At some point people will tune out and/or find alternatives.
This is the bottom line. Karl Marx was too angry to understand this fact.
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Chicos you are a smart business guy. What you are listing above indicates that ESPN is being poorly run. They are spending more on rights, with the only hope being to charge more and more for their product. In a climate fighting against these rising costs, they should not continue paying a premium for the content. If cable companies balk at the increase in costs, because they are afraid to lose customers, ESPN would be left holding the bill. Seems like they should have more foresight into shifting economic climates.
Really opens the door for a new company like Fox.
The new competition (Fox Sports 1 and others?) has something to do with ESPN spending like there is no tommorrow.
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The new competition (Fox Sports 1 and others?) has something to do with ESPN spending like there is no tommorrow.
It's a double edged sword.
If they buy up/overpay for the top live sports properties, in theory, they have to raise their rates.
If they keep raising their rates, it opens up a larger slot for a competitor to come in underneath.
The competitor won't have the top live content, but they might be able to follow the blueprint of another sports network... named ESPN.
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The demand isn't inelastic.
Eventually, people will just tune out and spend their time/money elsewhere.
Now, that doesn't mean ESPN or cable companies are going to fail next year... but it does open up the marketplace for a cheaper/different entertainment/content options.
ESPN will keep cranking it up, and consumers will keep paying... right up until they don't.
I've heard that argument in sports for two decades and it has yet to waiver...the sports teams and leagues know it. With every strike and fans saying\threatening they won't come back, they come back. On the television side, nothing is more "DVR proof" than sports, which is why they can charge what they do. People don't want to watch a game 2 days later.
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Chicos you are a smart business guy. What you are listing above indicates that ESPN is being poorly run. They are spending more on rights, with the only hope being to charge more and more for their product. In a climate fighting against these rising costs, they should not continue paying a premium for the content. If cable companies balk at the increase in costs, because they are afraid to lose customers, ESPN would be left holding the bill. Seems like they should have more foresight into shifting economic climates.
Really opens the door for a new company like Fox.
It's the reality of sports rights. They are protecting their turf. If anything, Fox is going to make it much worse. NBC, FOX are going to drive up prices even more to keep content away from ESPN, but ESPN will come in and pay it which will keep FOX and NBC with mostly the scraps, but the consumer will ultimately pay a lot more as a result of all the rights fees being paid. NBC paying $260 million for EPL is an example. That's a ton of money for something that will be very difficult for them to monetize directly. NBC has done it for years with the Olympics...their hope is to drive other ratings and make it work for them. That's the nature of the TV business. It's definitely crazy, that's for sure. Not just TV, either. I have a friend at Wasserman Sports and they just concluded a deal with Microsoft and the NFL yesterday at over $400 million for a sponsorship. Monopoly money.
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There are some very smart people who have tried to convince me for years that competition and choices are unimportant in health care because it is "different". You are a very smart person trying to tell me the same thing about television. It's what people looking to establish a monopoly or protect one reflexively say. I disagree in both cases.
Well, it's pretty fundamental. What are the cost of goods needed to produce content and the adoption rate of a product \ the need to fill hours. Pretty fundamentally obvious how different things are. No one has a gun to anyone's head, they can choose not to go to the movies or not watch television.
I disagree with you on healthcare as well. How many businesses out there have to carry insurance to the tune that a doctor, hospital does for every single "customer" they meet? It's incredible, but that drives up costs. Create a drug that helps 99.99% of the population, but 99 of the other drugs you developed never got approved by the FDA so you need to monetize that one that did plus deal with the issues that is causes for the 0.01% that you are sued into oblivion for.
Again, not many industries like those two. Some I would argue are, but most are not. Trying to cookie cutter all these is a fool's errand.
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Well, it's pretty fundamental. What are the cost of goods needed to produce content and the adoption rate of a product \ the need to fill hours. Pretty fundamentally obvious how different things are. No one has a gun to anyone's head, they can choose not to go to the movies or not watch television.
I disagree with you on healthcare as well. How many businesses out there have to carry insurance to the tune that a doctor, hospital does for every single "customer" they meet? It's incredible, but that drives up costs. Create a drug that helps 99.99% of the population, but 99 of the other drugs you developed never got approved by the FDA so you need to monetize that one that did plus deal with the issues that is causes for the 0.01% that you are sued into oblivion for.
Again, not many industries like those two. Some I would argue are, but most are not. Trying to cookie cutter all these is a fool's errand.
You would be an excellent lobbyist, but you'll never convince me that crony capitalism, corporate welfare and the discouragement of competition promote the common good, so we'll agree to disagree.
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Well, it's pretty fundamental. What are the cost of goods needed to produce content and the adoption rate of a product \ the need to fill hours. Pretty fundamentally obvious how different things are. No one has a gun to anyone's head, they can choose not to go to the movies or not watch television.
I disagree with you on healthcare as well. How many businesses out there have to carry insurance to the tune that a doctor, hospital does for every single "customer" they meet? It's incredible, but that drives up costs. Create a drug that helps 99.99% of the population, but 99 of the other drugs you developed never got approved by the FDA so you need to monetize that one that did plus deal with the issues that is causes for the 0.01% that you are sued into oblivion for.
Again, not many industries like those two. Some I would argue are, but most are not. Trying to cookie cutter all these is a fool's errand.
Chico,
I have to admit I am seriously disappointed in you. You are not remaining true to your libertarian leanings by arguing thusly. Adam Smith, Milton Friedman, Simon Kuznets, and Ronald Reagan weep bitter tears of vain expectation. You, sir, are a sheep of much cry but little wool. An interventionist wolf in the velvety guise of a free market lamb. For shame! Please return your membership card to the Cato institute forthwith.
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Chico,
I have to admit I am seriously disappointed in you. You are not remaining true to your libertarian leanings by arguing thusly. Adam Smith, Milton Friedman, Simon Kuznets, and Ronald Reagan weep bitter tears of vain expectation. You, sir, are a sheep of much cry but little wool. An interventionist wolf in the velvety guise of a free market lamb. For shame! Please return your membership card to the Cato institute forthwith.
LOL. I've asked for an explanation why you think this particular industry is the same as the widget industry that others want it to be.....whether it is producing Pepsi, or whatever. No one has explained it to me yet or the very smart people that have reported on this for years and years.
I'll keep my membership, thank you. Friedman is a hero of mine. RR....love him, though he did plenty of things that he could have turned his own card in for (amnesty, etc). There are exceptions to all rules, and this happens to be one of them, at least for now. Maybe it changes down the road, I suspect it will at some point, we're certainly trying to do so, but it is absolutely different than just about every other industry out there. Them are just the facts. When every product produced (every game, every show, every broadcast, etc) is unique to the core and not repeatable (assembly line thinking), then you have a different model from which to start.
We'll see where it goes...someone like HBO can probably pull it off some day because they are already an a la carte service, but not yet. Most of the other channels and sports content, going to be awhile.
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I'll keep my membership, thank you. Friedman is a hero of mine.
Well, your "hero" is rolling over in his grave even as we speak. You've made him very sad.
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Well, it's pretty fundamental. What are the cost of goods needed to produce content and the adoption rate of a product \ the need to fill hours. Pretty fundamentally obvious how different things are. No one has a gun to anyone's head, they can choose not to go to the movies or not watch television.
I disagree with you on healthcare as well. How many businesses out there have to carry insurance to the tune that a doctor, hospital does for every single "customer" they meet? It's incredible, but that drives up costs. Create a drug that helps 99.99% of the population, but 99 of the other drugs you developed never got approved by the FDA so you need to monetize that one that did plus deal with the issues that is causes for the 0.01% that you are sued into oblivion for.
Again, not many industries like those two. Some I would argue are, but most are not. Trying to cookie cutter all these is a fool's errand.
I know this discussion is about television, but your analysis of the healthcare industry is deeply flawed (and there are some carry overs to the television industry). The healthcare industry, particularly drug discovery is not very efficiently run, primary reason being is that they can afford to gamble alot as they can force prices on the consumer and insurance companies. More over they can and have committed flat out fraud and been given essentially free passes because if we actually convicted them no one with govt' health care would be allowed access to the medications they need.
If we remove the safety net of guaranteeing the consumer will pick up the tab, the industry would be forced to become more efficient and have a more steamlined discovery infrastructure. I think television will be similar, right now there is a guarantee that costs will be passed on to the consumer that is driven by the monopolies cable companies have. Pull the rug out and these television stations will be forced to be more efficient and selective in their projects, thereby keeping prices down.
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If we remove the safety net of guaranteeing the consumer will pick up the tab, the industry would be forced to become more efficient and have a more steamlined discovery infrastructure.
I have worked in drug discovery and development and can assure you that protocols for safety, safety, safety, then efficacy preclude the normal productivity gain mechanisms afforded other R&D efforts. Any experimentation involving unproven molecules on human subjects are by design methodical, rigorously meticulous in procedure, readily duplicable, and documented to an extreme degree. It can take years to get data lock on the most mundane safety criteria.
Imagine the cost associated with running parallel trials at multiple sites in numerous political jurisdictions, each with its own regulatory oversight. Everything that goes into and comes out of a subject's body is weighed, tested, assessed, evaluated. Everything.
At GE Cap we only managed the data collection piece of Clinical Trials. Quintiles managed the physical infrastructure while Sun provided the back end servers and Microsoft the middle tier. Harvard provided the medical component and the Singapore MoH contributed the bilingual English/Mandarin and English/Hindi CRAs. At GE we had hundreds of DBAs working on the data management and the cost per body was not insignificant. We also had biostatisticians, microbiologists, and epidemiologists on staff.
All of this was only the Trial infrastructure. Add in Big Pharma's costs associated with all of the pre-trial research as well as the in-Trial expenses and it is easy to see how getting a molecule to regulatory approval after 3 Phases approached $1 Billion.
When Big Pharma id's a promising molecule they patent it and the clock begins ticking. Every day spent in Trial is one less day they have to market the drug under patent protection before generics wash away their margins.
The current system is flawed and something everybody forgets is that litigation is the single biggest factor debilitating drug discovery and development. I cringe every time I see the class action ads on tv...
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Keefe
I'm curious, what do you think Friedman would have said about an industry in which all the entities, the rich and the poor must share a majority of their profits and must spend a mandated percentage on labor? Allowing for the weakest entities to compete on the same level as the strongest?
Normally I, like Friedman, would say this is crazy. Yet some industries its not only workable its neeed. The example above is the NFL.
There are certain industries that don't fit the mold.
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I have worked in drug discovery and development and can assure you that protocols for safety, safety, safety, then efficacy preclude the normal productivity gain mechanisms afforded other R&D efforts. Any experimentation involving unproven molecules on human subjects are by design methodical, rigorously meticulous in procedure, readily duplicable, and documented to an extreme degree. It can take years to get data lock on the most mundane safety criteria.
Imagine the cost associated with running parallel trials at multiple sites in numerous political jurisdictions, each with its own regulatory oversight. Everything that goes into and comes out of a subject's body is weighed, tested, assessed, evaluated. Everything.
At GE Cap we only managed the data collection piece of Clinical Trials. Quintiles managed the physical infrastructure while Sun provided the back end servers and Microsoft the middle tier. Harvard provided the medical component and the Singapore MoH contributed the bilingual English/Mandarin and English/Hindi CRAs. At GE we had hundreds of DBAs working on the data management and the cost per body was not insignificant. We also had biostatisticians, microbiologists, and epidemiologists on staff.
All of this was only the Trial infrastructure. Add in Big Pharma's costs associated with all of the pre-trial research as well as the in-Trial expenses and it is easy to see how getting a molecule to regulatory approval after 3 Phases approached $1 Billion.
When Big Pharma id's a promising molecule they patent it and the clock begins ticking. Every day spent in Trial is one less day they have to market the drug under patent protection before generics wash away their margins.
The current system is flawed and something everybody forgets is that litigation is the single biggest factor debilitating drug discovery and development. I cringe every time I see the class action ads on tv...
I've been involved in drug discovery also, and can tell you that Big Pharma can improve on efficiency significantly. I realize drug trials are quite expensive and there is a lot of risk. I know whole companies that folded, because a rat dies after taking a drug, but that doesn't mean they are being run in the best manner possible.
I'll also say that big pharma is probably the shadiest industry out there.
Also, on the patent side there are a lot of avenues to extend their patent rights. For example, extended release formats, that provide no additional efficacy, but can allow them to obtain/extend the patent. If the company holding the patent sues the provider of a generic, there is an automatic hold of 30 months before a generic can be offered.
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The current system is flawed and something everybody forgets is that litigation is the single biggest factor debilitating drug discovery and development. I cringe every time I see the class action ads on tv...
As do I and most sane people sans the Trial Lawyers of America.
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I know this discussion is about television, but your analysis of the healthcare industry is deeply flawed (and there are some carry overs to the television industry). The healthcare industry, particularly drug discovery is not very efficiently run, primary reason being is that they can afford to gamble alot as they can force prices on the consumer and insurance companies. More over they can and have committed flat out fraud and been given essentially free passes because if we actually convicted them no one with govt' health care would be allowed access to the medications they need.
If we remove the safety net of guaranteeing the consumer will pick up the tab, the industry would be forced to become more efficient and have a more steamlined discovery infrastructure. I think television will be similar, right now there is a guarantee that costs will be passed on to the consumer that is driven by the monopolies cable companies have. Pull the rug out and these television stations will be forced to be more efficient and selective in their projects, thereby keeping prices down.
1) Cable companies don't have monopolies any longer. Satellite is available to 94% of people in this country
2) Do you really think these content providers aren't already incredibly selective in their projects? They don't just rush every show to the small screen. I can't remember what the latest stats are, but more than 90% of scripts never even get piloted (i.e. created). Shows are vetted, focus grouped again and again and again, yet most fail. One person's treasure is another person's junk. Think of it like a painter....DaVinci painted thousands of paintings in his lifetime, how many are "great"? Or a composer's work? Or a Director's work. Too many people think along the lines of the hits, not the millions of failures that get you the hits. Without the ability to create, and let's face it, this is an industry based on creation, you can't get the hits.
That's why I used the drug example. I have some good friends at Amgen and Eli Lilly, and it's crazy the promising work that is done on a whole host of drugs when only one drug comes to market, and even then the litigation for that "successful" drug is insane. Most of the stuff considered for the pipeline never gets to market. As such, they monetize the crap out of the one or two "hits" that do make it to the market to pay for the R&D, etc. That's why I used the analogy. Many many failures, a few hits, and they are going to charge for those hits in order to keep developing. Similar to the content creators.
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1) Cable companies don't have monopolies any longer. Satellite is available to 94% of people in this country
2) Do you really think these content providers aren't already incredibly selective in their projects? They don't just rush every show to the small screen. I can't remember what the latest stats are, but more than 90% of scripts never even get piloted (i.e. created). Shows are vetted, focus grouped again and again and again, yet most fail. One person's treasure is another person's junk. Think of it like a painter....DaVinci painted thousands of paintings in his lifetime, how many are "great"? Or a composer's work? Or a Director's work. Too many people think along the lines of the hits, not the millions of failures that get you the hits. Without the ability to create, and let's face it, this is an industry based on creation, you can't get the hits.
That's why I used the drug example. I have some good friends at Amgen and Eli Lilly, and it's crazy the promising work that is done on a whole host of drugs when only one drug comes to market, and even then the litigation for that "successful" drug is insane. Most of the stuff considered for the pipeline never gets to market. As such, they monetize the crap out of the one or two "hits" that do make it to the market to pay for the R&D, etc. That's why I used the analogy. Many many failures, a few hits, and they are going to charge for those hits in order to keep developing. Similar to the content creators.
I wonder if you went to DaVinci's house and wanted to buy a painting if he would only sell it to you if you would also buy some crap nobody else wanted. Or if a drug company would only sell you an arthritis drug you found effective if you also bought some junk from their warehouse that didn't work. Or if a movie studio would only let you pay to see Iron Man if you also bought a ticket to Gigli. Create enough hits to cover your misses (or one big enough hit) and you're in business. Don't and you fail. Isn't that the American way?
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Keefe
I'm curious, what do you think Friedman would have said about an industry in which all the entities, the rich and the poor must share a majority of their profits and must spend a mandated percentage on labor? Allowing for the weakest entities to compete on the same level as the strongest?
Normally I, like Friedman, would say this is crazy. Yet some industries its not only workable its neeed. The example above is the NFL.
There are certain industries that don't fit the mold.
Friedman was a big Sox fan so I believe he would be in favor of competitive balance in professional sports. Baseball's anti-trust exemption exists for the reason that the internal management of MLB or the NFL is to maintain some semblance of competitive balance. The mistake you make is in confusing competitive balance with competitiveness. MLB, NFL, NBA, NHL are collectives with 30-32 independent business units. Profit sharing and access to labor are mechanisms used to control competitive balance between the constituent members of the collective.
But MLB or the NFL must be competitive within the entertainment vertical for it is there that they slug it out with Hollywood, the symphony, the local poetry reading, a trip to Disneyland, or having a beer in your backyard. Consumers vote with their wallets and baseball competes with Sea World for a family's discretionary entertainment spend. They may purchase tickets to see the Padres but that is a sub-brand to MLB.
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We'll see where it goes...someone like HBO can probably pull it off some day because they are already an a la carte service, but not yet. Most of the other channels and sports content, going to be awhile.
Your agreement to eventually agree with the rest of us who support free commerce is accepted.
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I've been involved in drug discovery also, and can tell you that Big Pharma can improve on efficiency significantly. I realize drug trials are quite expensive and there is a lot of risk. I know whole companies that folded, because a rat dies after taking a drug, but that doesn't mean they are being run in the best manner possible.
I'll also say that big pharma is probably the shadiest industry out there.
Also, on the patent side there are a lot of avenues to extend their patent rights. For example, extended release formats, that provide no additional efficacy, but can allow them to obtain/extend the patent. If the company holding the patent sues the provider of a generic, there is an automatic hold of 30 months before a generic can be offered.
As will all things involving the government, the excessive degree of regulatory oversight on human subject clinical trials inhibits efficiencies that might otherwise be obtained. Having said which the principle aims of our joint venture was:
- expand trustworthy investigation into jurisdictions that had theretofore not been credible sources for validated study
- expand the statistical sample of human subjects for clinical investigation
- increase the statistical data base of de-identified patient data for clinical analysis
- enable greater accuracy and efficiency through technological innovation
We implemented the first EDC trials in Asia (and the first paperless Phase III anywhere) that improved accuracy and accelerated data lock by 70%. This was almost 20 years ago but at the time was revolutionary. At that time the only EDC was done for Phase IV which has far less regulatory oversight. One of the yields from this project was the platform that is now Oracle Clinical. I can assure you that GE made some money on this venture.
As for efficiency in Clinical Trials I would always default to the overwhelming need for safety and security. Any investigations involving human subjects must position safety as the paramount consideration. Anything less is criminal.
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Your agreement to eventually agree with the rest of us who support free commerce is accepted.
My guess is the time horizons you envision are much different than mine.
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I wonder if you went to DaVinci's house and wanted to buy a painting if he would only sell it to you if you would also buy some crap nobody else wanted. Or if a drug company would only sell you an arthritis drug you found effective if you also bought some junk from their warehouse that didn't work. Or if a movie studio would only let you pay to see Iron Man if you also bought a ticket to Gigli. Create enough hits to cover your misses (or one big enough hit) and you're in business. Don't and you fail. Isn't that the American way?
Like I said, we would sell the channels a la carte in a second, but we can't. But don't pretend that the drug company isn't selling that drug for X times what it costs to produce or even cover the R&D because they are also monetizing it against the failed drugs they tried to generate. This is very similar to what the media companies will do. I told you, ESPN could go down this path and you would pay $20 a month just for ESPN...if that's the way you want to go, then have at it. Canada is trying it and it's imploding because people now realize what it actually means. To each their own.
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Friedman was a big Sox fan so I believe he would be in favor of competitive balance in professional sports. Baseball's anti-trust exemption exists for the reason that the internal management of MLB or the NFL is to maintain some semblance of competitive balance. The mistake you make is in confusing competitive balance with competitiveness. MLB, NFL, NBA, NHL are collectives with 30-32 independent business units. Profit sharing and access to labor are mechanisms used to control competitive balance between the constituent members of the collective.
But MLB or the NFL must be competitive within the entertainment vertical for it is there that they slug it out with Hollywood, the symphony, the local poetry reading, a trip to Disneyland, or having a beer in your backyard. Consumers vote with their wallets and baseball competes with Sea World for a family's discretionary entertainment spend. They may purchase tickets to see the Padres but that is a sub-brand to MLB.
I agree with some of this, but not entirely. There have been teams that have purposely lived off the shared revenues and not tried to be competitive because it was more profitable for them to do that. Basically put out a team with limited stars, rookies, journeymen and collect the fat revenue sharing checks. Plenty of examples out there. Also factor in that the value of these teams have absolutely exploded so even if they are "losing" money in a given year, when they go to sell the team they are making out very well.
I also don't think you are correct with some sports. NFL teams don't have to be competitive and fans still buy the tickets. There are only 8 games at home and even the worst of the worst teams sell out or come within 5% of sellouts for all of their games. In some markets, this is all they have. It's certainly tougher for a team in California to do this, but if you're in Buffalo, Green Bay, Minneapolis, etc, there aren't a whole of other things going on that are going to eat into your selling opportunities.
So humor me a bit, you do agree (I think) based on your response that some industries are better served with a non-free market (or fully free market) model...correct? I don't want to put words in your mouth, but it seems you are acknowledging that even Friedman would be in favor of competitive balance for which the lever that is most often used has been revenue sharing and a salary cap, hardly the principles of a free market.
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I agree with some of this, but not entirely. There have been teams that have purposely lived off the shared revenues and not tried to be competitive because it was more profitable for them to do that. Basically put out a team with limited stars, rookies, journeymen and collect the fat revenue sharing checks. Plenty of examples out there. Also factor in that the value of these teams have absolutely exploded so even if they are "losing" money in a given year, when they go to sell the team they are making out very well.
I also don't think you are correct with some sports. NFL teams don't have to be competitive and fans still buy the tickets. There are only 8 games at home and even the worst of the worst teams sell out or come within 5% of sellouts for all of their games. In some markets, this is all they have. It's certainly tougher for a team in California to do this, but if you're in Buffalo, Green Bay, Minneapolis, etc, there aren't a whole of other things going on that are going to eat into your selling opportunities.
So humor me a bit, you do agree (I think) based on your response that some industries are better served with a non-free market (or fully free market) model...correct? I don't want to put words in your mouth, but it seems you are acknowledging that even Friedman would be in favor of competitive balance for which the lever that is most often used has been revenue sharing and a salary cap, hardly the principles of a free market.
I would say that there are certain industries that should have regulatory oversight for the sake of safety and health. One only need read Upton Sinclair or Charles Dickens to fathom the horrors of industrialization. I was speaking just yesterday with another Scoop member about abuses that take place today in manufacturing in south China. My view is that no Christmas ornament is worth the health of the young women producing them in toxic fumes and dangerous machinery without adequate safety controls in place.
I would say that commercial aviation is an example of an industry that requires oversight, again for safety reasons. It was absolutely controlled in the past but has been quasi-deregulated over the past 30 years. What has transpired is inefficient carriers have struggled and disappeared, only to be replaced by leaner, keener competitors. There has been significant consolidation but for every Braniff there has been a Southwest or Virgin to raise the efficiency bar. Entrepreneurs like Kelleher and Branson have revolutionized the industry, forcing others to adapt or die.
Prior to 1980 it was impossible for a Southwest or Virgin to enter the market as routes and gates were controlled by the government. Fares ran 500% greater in NPV terms simply because there was no competition. And as Open Skies theory gained traction in international routes more innovative carriers as Singapore shoved the entrenched players, BOAC, Pan Am, and TWA, into bankruptcy.
Singapore revolutionized the industry by changing a carrier's corporate paradigm. SQ was the first carrier to not see itself as a transportation company that flew aircraft. Rather, it identified itself as a service company that happened to fly aircraft. The traditional model for service was that an airline could only concern itself with the time a passenger was in a seat. SQ opened up the aperture to make the UX better from the moment a passenger contemplated taking an international trip until he walked back through his front door. Every potential UX was identified, measured, calibrated and analyzed. SQ introduced Kaizen protocols to ensure the very best possible UX.
Product innovation and service excellence were the guiding principles of SQ operational practice. Singapore pioneered a number of industry firsts, all designed to improve the UX:
- free headphones in all compartments
- free alcohol in all classes
- meal choices in all compartments
- in-flight phone service
- personal entertainment systems
- city check baggage service
In the domestic industry Herb Kelleher emphasized financial management at Southwest to a degree not seen before in the industry. He standardized his fleet to make maintenance more efficient; carrying costs for spares were 15% of that at UAL and NWA which operated multi-platform fleets. He obtained gates at older, less expensive in-town fields that were actually more convenient for most business travelers. And he was the first airline to play futures. When fuel prices sky rocketed only SWA had controlled its single biggest variable expense through the use of futures. And for 4 years only SWA made money. I won't get into his labor practices as that might be controversial but Management-Labor relations at SWA are the best in the domestic industry.
Compare all of this with the industry prior to deregulation. Innovators like SWA and Virgin could not have entered the marketplace. Stodgy players like Pan Am, TWA, Braniff, Eastern, BOAC, Sabena, etc... ruled the skies but flitted in and out of bankruptcy protection. Aviation is still regulated to a degree but the inefficient are no longer protected. Should every country have a national airline? Only if they can operate efficiently in a de-regulated marketplace. Belgium and Singapore are comparable in that there is no domestic market per se so all flights are international. But SQ is run brilliantly while Sabena was just another government bureaucracy. Sabena died because the already overburdened Belgian taxpayers had enough of subsidizing incompetence. SQ gets no subsidy from the Singapore government but then it has demonstrated it does not need it.
Regulatory oversight still exists but it is really to sort out safety issues and other problems associated with international travel. I cannot comment on entertainment as I have no experience in it other than as a consumer. But I know that cable companies get away with murder because the genesis of that industry was through governmental midwives. They offer horrible product and abysmal customer service because they can. I have always had DirecTV because cable is a nightmare. But DTV is far from being responsive; they are just better than the cables in terms of service and had better sports packages than your sole competitor, Dish. I will always argue against monopolies and government regulation whenever possible. I believe that serves me well with the Cato Institute, Milton Friedman, and St. Ronald Reagan.
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Also factor in that the value of these teams have absolutely exploded so even if they are "losing" money in a given year, when they go to sell the team they are making out very well.
This reminds me of a line from one of my favorite artists. Roger Waters wrote, "Think I'll buy me a football team..."
Sports franchises, like art work, have artificial value and cannot be correlated with the broader marketplace. These are vanity assets that gain equity uptick through incoherent factors not found elsewhere. While there is some relationship with the financial performance these are by and large valued in ways that lack conventional measurement.
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Keefe
I don't disagree with what you said there, especially with the aviation industry. In our industry, I believe we've made television 100X better and actually got cable to get their crap together because at the time they were a monopoly. Our technological leaps have forced them to get better. Service is always a challenge with products that have many variables (user error, electricity, weather, infrastructure, computer chips, etc)....no question about it.
Some interesting times ahead. We'll see if we get Hulu as it has been widely reported that we are bidding along with some others. Technology keeps changing, still at the end of the day it's the content that drives the pricing. We spent over $10 billion on programming fees alone last year...that's more than the GDP of about 65 nations...just on programming fees. Interesting times ahead, indeed.
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Keefe
I don't disagree with what you said there, especially with the aviation industry. In our industry, I believe we've made television 100X better and actually got cable to get their crap together because at the time they were a monopoly. Our technological leaps have forced them to get better. Service is always a challenge with products that have many variables (user error, electricity, weather, infrastructure, computer chips, etc)....no question about it.
Some interesting times ahead. We'll see if we get Hulu as it has been widely reported that we are bidding along with some others. Technology keeps changing, still at the end of the day it's the content that drives the pricing. We spent over $10 billion on programming fees alone last year...that's more than the GDP of about 65 nations...just on programming fees. Interesting times ahead, indeed.
I agree that the satellite players forced the cables to become more responsive. Perfect example of why government sanctioned monopolies are horrible for efficiency, customer service, and overall competitiveness.
I was not aware you guys were sniffing at Hulu but it certainly makes sense. I would not see that as a content play, however. It's more about delivery and access. You guys are a distribution company and the more portals you control the more compelling your USP.
The real winners of tech innovation are the consumers. I remember as a kid when the old Magnavox crapped out. My dad would open up the back panel and pull a bunch of tubes. We would head over to the hardware store where he used the "Bulb tester" to deconflict the problem. The UX of today is markedly different than just 5 years ago. I really do believe the sats are so much better positioned for the long term than the land line players. Delivery is fundamentally driven by transmission media. Exciting times.
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We bid a year ago but ultimately the auction went south for everyone. Now it's back on the table.
http://www.complex.com/tech/2013/05/directv-time-warner-place-bids-to-buy-hulu
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We bid a year ago but ultimately the auction went south for everyone. Now it's back on the table.
http://www.complex.com/tech/2013/05/directv-time-warner-place-bids-to-buy-hulu
(http://www.newyorker.com/images/2008/05/12/cartoons/080512_cartoon_a_a13168_p465.gif)
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I told you, ESPN could go down this path and you would pay $20 a month just for ESPN...if that's the way you want to go, then have at it. Canada is trying it and it's imploding because people now realize what it actually means. To each their own.
If I want ESPN enough to pay $20 a month for ESPN that's up to me, but it's certainly not fair to force everyone to pay $5 (or whatever) if they don't. Maybe it will (eventually) mean that revenues shrink throughout the business of sport to meet real demand rather than an artificial one. Or maybe there's truly enough demand to support further increases. Why not stop the corporate welfare and find out?
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This is somewhat interesting. The May 2013 issue of Connecticut Magazine has a short interview with ESPN President John Skipper. The reporter brings ups some MUScoop discussed topics.
http://www.connecticutmag.com/Connecticut-Magazine/May-2013/Final-Say-John-Skipper/
Final Say: John Skipper
by Ray Bendici
John Skipper, 57, is the president of ESPN and co-chairman of Disney Media Networks. Previously, he was ESPN’s executive vice president of content, and has also served as general manager of ESPN The Magazine. He lives in Wilton.
What are the plans for ESPN 8, The Ocho?
The Ocho? [laughs] I don’t think we’re going to actually name anything The Ocho, but I think we’ll have ocho. We have ESPN 1, 2, 3, ESPN News, Deportes, Classic, ESPNU and The Longhorn Network, so we already have eight networks already. We’re not going to use The Ocho twice—I’m not going to give Ben Stiller the satisfaction.
Is it possible for sports to become even more popular?
Will it become more popular? Sports is pretty central to the culture. What I do believe is that there’s still demand for more sports because there are still people who have games they care about that aren’t produced and available widely. So yeah, I think sports will remain ascendant. The other issue you’ve got, of course, is that sports are live and in this current media environment, the only thing you have to watch live other than news—although this is scheduled, meaning we know when the Rose Bowl is and it’s unique, so you can’t knock it off, and it’s live, so you can’t DVR it. This all that portends for growth. Ninety-nine percent of all ESPN is watched live, and that’s a big advantage, say if you want to advertise a movie on Thursday because it’s opening on Friday, and you want to make sure that everybody is watching right then and not the next Wednesday on their DVR.
Are sports over-exposed?
No, I don’t think so. Fans want as much choice as possible. But it’s a choice—if you don’t want to watch it, you don’t have to watch it. It’s not going to get overexposed. My son went to Davidson College in North Carolina, and the Southern Conference tournament was this weekend and he was able to watch all of it on ESPN3, so he doesn’t think of that as being overexposed. He just thinks of that as being available.
It seems that for sports like the NFL and MLB, the coverage is now year-round. How does the ESPN 24/7 news cycle play into that?
You could argue that ESPN was quite influential in that. Long before I got here, ESPN began to make—out of necessity—events out of the off season. The NFL draft, training camps . . . now we do it with college-recruiting sign-up days, we do it with Major League Baseball winter meetings, we do it with the NBA Summer League, so if you’re a fan, you’re a fan year-round. Even when there are not games, you’re a fan because your team is trading for players or signing free agents. So almost all sports are year-round now. You don’t see the seasonal swings you used to see.
FOX just announced its own sports network and—
You’re kidding! [laughs] I need to get some information on this!
Right? And NBC is increasing its sports coverage, so is there enough content for everyone?
Well . . . it’s an excellent question because the answer is “Yes,” and “No.” There is literally enough content, right? What there is a scarcity of is high-profile big events. There’s a lot of content, right? There’s at least 300 American universities that play college football and basketball—there’s more than that, 500 or 600—there’s wrestling teams, there’s high-school track teams . . . but when you get to the things that aggregate an audience of a million-plus people, there’s not that much. There’s Major League Baseball, NBA, SEC football, Wimbledon, etc. So the issue for these new networks is that there’s plenty of content to put on, but is there big-event content that can actually aggregate you an audience? Because you need those big events to have your studio programming get a big audience because it’s all about lead-ins. Very little studio programming is appointment viewing. Mostly you tune in to see the game and you stay around afterward to watch “SportsCenter.” You tune in early to see “College Game Day” because you’re going to be watching the game afterward.
NBC Sports has been infringing on your turf by setting up in Stamford—do you feel like the home team?
Oh yeah. I wouldn’t use the word “infringe.” I mean, NBC has moved into the 24/7 cable business, they have a radio-syndication business, they’ve been more aggressive with their digital business, so I’d certainly suggest that they’re looking to compete with us. The question of whether they’ve infringed on us or not is not clear. I think so far we’ve been holding our own.
ESPN is one of Gov. Malloy’s “First Five” participants and has demonstrated a big commitment to the state—other than the tax breaks, why here?
Well you know, it’s legacy and it’s competitive advantage and it’s culture, right? This is where it started back in 1979. At various times in the company’s history, there were decision points where the company decided to stay here rather than go somewhere else, which turned out to be an enormous advantage. None of those decision points have been recently, by the way—they were early in the company’s history. We’re here, we’re going to be here and we think it’s an enormous competitive advantage because we’ve created a Bristol culture. It’s a culture of work ethic, a sense of not being in the mainstream in New York City, the media capital of the world—we’re up here in Bristol and there’s sort of a hometown advantage to being here. People feel real pride at being from Southington and Cheshire and Plainville and Bristol and Waterbury and Southbury and Southtown—wait, I don’t think there’s actually a Southtown. [laughs] So we think it’s great, we have no intention of going anywhere. We like being in this particular part of the state as well. You mentioned NBC; they decided to go to Stamford—that works for them because they’re really a New York City company. We’re a Bristol company. We’re proud of being from here.
More plans for expansion?
Our business is good. Right now we’re building a new digital center, too, which is 193,000 square feet of space. We’ve never had a moment on this campus, I’m told, where there wasn’t building and growth. As president of this company, it’s my intention to continue to be a growth company.
Biggest challenge for the worldwide leader in sports?
You know, it’s hard to say that there’s a big challenge; there are several big challenges. Maintaining the culture of the company. Maintaining the quality of the people who work here is very, very important. We have a very successful business model, which has as one of its important elements the pay-television business, so the continuation of that business is an important issue for us. Competition is important, you mentioned that. You heard me talk about how important big-event live rights are, and that is an issue for us, maintaining that live rights portfolio. Making sure we get into new platforms—digital, mobile apps. If you have to sum it up into one thing, we just have to keep our edge—we have to be not complacent. As long as we concentrate on what we’re doing—we have an established business, we have a long head start, we have the best brand in sports. We just need to keep doing what we’re doing and not get complacent.
Biggest challenge for the leader of the worldwide leader in sports?
The biggest challenge is managing my time, prioritizing, figure out where best to use my time because the range of things I can get involved in from rights deals to innovations owned to studio programming to relationships with major partners, distribution deals to being out at the Walt Disney Company to participate there . . . . It’s also staying in touch with as many people as possible. This is a very people-oriented culture, so I make a point to get down to the cafeteria and walk around, see people and shake hands. It’s one person with a plethora of things to do, so it’s figuring out how to spend my time, that’s the hardest challenge.
What’s one aspect of your job that no one knows?
I don’t know that people know really how much fun this is. I mean, it’s got stress and challenges and demands but it’s got to be one of the best ten jobs in the world, right? You’re working for ESPN, people love sports and it’s fun. I should say one of my biggest challenges is convincing my family that I’m working when I’m at sporting events! They just think I’m having fun.
Do you get to watch a lot of live sporting events?
I do get to a lot of sporting events. Over the course of the last 10 to 15 years, I’ve had the great fortune to be at most of the major sporting events in the world. I try not to tell people on airplanes stuff I’ve done because I’m concerned they’ll throw me out.
Favorite venue?
You know I’m a big fan of the North Carolina Tarheels, so my favorite sporting venue was the old Carmichael Auditorium where North Carolina used to play basketball in, which was fabulous and fun. So I’ll stick to that, but you know, I love The Garden and going to see the Knicks play. College football stadiums are just fabulous. I mean you go to The Big House in Michigan, you go down to Blacksburg and see Virgina Tech play, you go to the Rose Bowl and sit there and watch the Rose Bowl, you go to Austin, Texas . . . I love college football stadiums. I also happen to love the English Premier League, so I’m fond of White Hart Lane.
You’re a big soccer fan—why has it struggled to gain the popularity of the other big sports in the U.S.?
Well, it’s a crowded landscape, right? And it’s a legacy. There have been big shifts—there was a time when this was not a professional sports team country, when it was about boxing, horse racing, it was about college football at one point, but now it’s about the NFL, MLB, NBA, NASCAR, big-time golf and tennis. Soccer’s coming, though. It’s just got to find its place in this very crowded landscape. We’re the only country in the world to have this wide variety of popular sports. Most countries, it’s just a couple of things. In the U.S., we have lots and lots of sports variety, and soccer is wedging its way in and becoming more important, and I think that trend will continue.
What other sports do you enjoy/play?
The thing that I enjoyed playing the most in my life was basketball, and I’m too feeble now to play. But that’s what I enjoyed playing in my life. Back to your earlier question: I have the great pleasure of being at the Super Bowl, I’ll be at the NCAA Women’s Final Four, I was at the World Series last year, I get to the U.S. Open tennis in New York, I get to The Masters—I always loved basketball, so I like it all. I love all my children!
Speaking of children, Given your ESPN and Disney background, your sons must’ve gotten used to access to things that most kids don’t experience—at any point, did they realize, “Hey, not everyone lives like this?”
Oh, yeah! I have 27- and 23-year-old boys, and they understand how lucky they are. [laughs] They can never become estranged from their father because my tickets are too good and they might actually have to figure out how to use StubHub!
Is it challenging to raise kids with such access?
We’ve been having a lighthearted conversation, but it’s one of the things I’m most proud of in my life—my wife Jessica probably had more to do with it than me. The challenge is keeping your kids grounded when they have so many opportunities and privilege. There’s nothing wrong with being privileged; what you can’t have it leading to is being spoiled or taking it for granted, and my kids do not. They never get anything that they don’t thank me for or anyone else who helped them to get the access. I’m very proud, obviously.
Sports Illustrated recently named you the "4th Most Powerful Person in Sports"—how much of that is you and how much of that is ESPN?
I’d say it’s about 99.99 percent ESPN and .01 percent Skipper. I mean, anybody in this job is going to be on the list. I’m in a different job, I’m not on the list.
Where you rank on that list is due to you—you could be 10 or 20.
ESPN has more to do with that. I am proud of working hard and making the contribution, and I’m proud of having the privilege of getting this job, so that’s an accomplishment, but the job carries with it the responsibility and the influence. I walk out of this job and my influence in the sporting business is pretty small.
How was it moving from Disney family-centric content to ESPN’s sports-centric atmosphere?
It was actually remarkably easy. I don’t know if it’s so much as “family” to “sports” as it’s about the culture and ethos of the companies. If you listen to Bob Iger [CEO of The Walt Disney Company], he’ll say it’s about creativity, it’s about integrity, it’s about innovation, it’s about growth, it’s about collaboration, so the Walt Disney Company and the ESPN division are very consistent. You don’t get the bends going from one culture to the other because there’s not much difference in the oxygen.
You started back in print—how was the transition from print to multimedia?
I was very fortunate. As you know, I love magazines—you work for a magazine. It was a very outstanding transition because there’s just more growth and vitality in other segments. Again, I have great affection and respect for magazines, so I don’t mean to be flippant talking to a magazine writer, you understand. But the transition wasn’t that hard. The fundamental things apply, right? I feel like I’m in Casablanca: “The fundamental things apply, as time goes by . . .” [laughs] If you’re creative in one medium, you can be creative in another medium. The main thing is understanding what the attributes of the medium are. In print, it’s about paper and ink and photography and design and ease of navigation because I can turn to page 73 quicker than I can figure out where page 73 is ESPN.com. But to me, it didn’t seem like a difficult transition.
Do you think print is dying? Or dead?
Dying? No. But is it challenged? Yeah. By the way, people love magazines, they love print. It’s the business—it’s just not where advertisers are putting their money. People haven’t quit reading magazines. We have 15 million people every two weeks reading ESPN Magazine, and they love it and they like it. But selling the ads into it is a challenge right now.
Given your magazine background [Rolling Stone and SPIN], What’s your favorite type of music?
Reggae. I have one of the largest reggae collections in Connecticut—sometime you can come out and do a photo spread on my reggae collection. I have thousands of reggae CDs. I don’t know what I’m doing with CDs, but . . . . I’m thinking in Fairfield County, I don’t have a lot of competition for reggae collections.
Favorite reggae artist?
Bob Marley.
Favorite musical athlete?
Musical athlete? No, I can’t think of a single, great musical athlete. Well, Bernie Williams is a real musician, but he ain’t no Bob Marley. I’m not struggling to figure out if I’m putting on some Bernie or Bob. [laughs]
Favorite SportsCenter commercial?
Yeah, I do actually have a favorite one. I’ve got to admit though, this is an old one, but it’s a funny one. I have never seen or said out loud, “Charley, come out and get your whuppin’!” without laughing. It’s the old Evander Holyfield and Charley Steiner commercial where Evander is walking through the office going, “Charley, come get your whuppin’!” and Charley is hiding under the desk. I laugh every time I see that.
MTV—no more music it seems. Other cable networks also seem to change their original mission trying to reach more audiences. does ESPN have that concern?
No. In fact, I think if anything, we have focused in the last few years on core stick-and-ball sports, sports, sports. There was a time when we veered a little bit toward ESPN Hollywood movies, but we think sports is ascendant in this culture and we’re going to ride that. Though I must confess, as a kid—ESPN, MTV and CNN all kind of started together in 1979, and were really the core of how the cable-television business got started because people wanted their MTV, they thought, “Wow, 24/7 news, 24/7 sports? This is fabulous!” and I think the issue for MTV is that they had kind of had a thing that happened: Music videos—free content, by the way, that was promotional in nature—and it was great. I remember watching Martha Quinn and Alan Hunter and those guys, but 24/7 news and 24/7 sports are still very excellent concepts.
Can we expect more fictional content?
Right now, no. It is not our intention to re-enter that.
ESPN is 34 this year—where do you see it in 34 years?
I see it from a very long distance away because I’m pretty sure I don’t have 34 years left! [laughs] I see it from the beach. I see myself in a hammock watching television! [laughs] This is a very sustain't I dimble business over a long period of time. There’s nobody foolish enough to predict what the world is going to look like in 34 years—what would that be, 2047? But if you had to make bets, you’re betting on the sustain't I dimbility of sports video—and I didn’t deliberately say television because it’s just video, right?—I’d make that bet. I can’t think of anything that’s a better bet, not even oil and gas because they’ll run out at some point. Sports will never run out.
This article appeared in the May 2013 issue of Connecticut Magazine
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Final Say: John Skipper
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This is somewhat interesting. The May 2013 issue of Connecticut Magazine has a short interview with ESPN President John Skipper. The reporter brings ups some MUScoop discussed topics.
NBC Sports has been infringing on your turf by setting up in Stamford—do you feel like the home team?
Oh yeah. I wouldn’t use the word “infringe.” I mean, NBC has moved into the 24/7 cable business, they have a radio-syndication business, they’ve been more aggressive with their digital business, so I’d certainly suggest that they’re looking to compete with us. The question of whether they’ve infringed on us or not is not clear. I think so far we’ve been holding our own.
I actually have some insight on the NBC Sports move to Stamford. It is related to GE ownership of the network and capturing synergies with GE Cap holdings in Stamford. That decision was made well before Comcast entered the picture.
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I actually have some insight on the NBC Sports move to Stamford. It is related to GE ownership of the network and capturing synergies with GE Cap holdings in Stamford. That decision was made well before Comcast entered the picture.
That is interesting. I know GE Capital has a huge campus on Long Ridge Road. Strangely, NBC Sports is located in a renovated building that used to be old Clairol shampoo factory.
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That is interesting. I know GE Capital has a huge campus on Long Ridge Road. Strangely, NBC Sports is located in a renovated building that used to be old Clairol shampoo factory.
I believe that property was better suited for production requirements. It is still part of Cap's portfolio. GE Cap is really an umbrella brand. I was on the GEFA side so we didn't do real estate but when we needed a new footprint in Tokyo the deal was managed by that unit of Cap. GE must be the single largest private employer in CT. I would dare say it has the highest tax base and payroll.
It is funny but when I was with PepsiCo it was the largest private employer in the world. The vast majority of the employees were employed at Pizza Huts, Taco Bells, KFCs, A&Ws, Long John Silvers, etc...around the world.
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I believe that property was better suited for production requirements. It is still part of Cap's portfolio. GE Cap is really an umbrella brand. I was on the GEFA side so we didn't do real estate but when we needed a new footprint in Tokyo the deal was managed by that unit of Cap. GE must be the single largest private employer in CT. I would dare say it has the highest tax base and payroll.
It is funny but when I was with PepsiCo it was the largest private employer in the world. The vast majority of the employees were employed at Pizza Huts, Taco Bells, KFCs, A&Ws, Long John Silvers, etc...around the world.
GE is the largest corporation headquarted in Connecticut (in Fairfield) and a large employer. The largest overall employer is actually United Technologies (UTC). The largest employer is the UTC Sikorsky Division (helicopters), followed by the Foxwoods Casino, Yale University then UTCs Pratt & Whitney Division (jet engines) and at # 5 is The Hartford Insurance. UTCs UTC Aerospace Systems Division falls in at #10.
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GE is the largest corporation headquarted in Connecticut (in Fairfield) and a large employer. The largest overall employer is actually United Technologies (UTC). The largest employer is the UTC Sikorsky Division (helicopters), followed by the Foxwoods Casino, Yale University then UTCs Pratt & Whitney Division (jet engines) and at # 5 is The Hartford Insurance. UTCs UTC Aerospace Systems Division falls in at #10.
I had forgotten about UTC being in CT. Of course they would be the largest in the state. I have flown three airframes using a mix of both PW and GE power plants. The 220E is just raw kick ass power while the TF 34 is brutally efficient. If I had to differentiate I would say GE power plants are far more reliable while PW's are something a Tennessee moonshiner would appreciate.
What is scary is that a casino is the second largest employer in the state. I can think of no less worthy or productive endeavor. Gambling does nothing from a wealth/value generation standpoint; it is really just moving sand between buckets. I am surprised there are more employed in CT at a casino than GE. GE has a lot of intellectual capital in that footprint.
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GE has like 6,500 employees in Connecticut among the HQ and all it's divisions so that's significant. For what its worth, Foxwoods is the largest casino in the world. The second largest casino resides 15 minutes away at the Mohegan Sun.
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GE has like 6,500 employees in Connecticut among the HQ and all it's divisions so that's significant. For what its worth, Foxwoods is the largest casino in the world. The second largest casino resides 15 minutes away at the Mohegan Sun.
I have heard of the Mohegan Sun because ESPN broadcasts women's pool. the Black Widow seems to be a crowd favorite. Certainly looks like she knows how to handle a stick.
(http://blackwidowbilliards.com/images/on_the_road.jpg)
(http://lastnewsusa.com/wp-content/uploads/2011/06/Jeanette-Lee-Pictures-6-300x447.jpg)
(http://www.poolhottiess.com/uploads/6/2/5/6/6256560/4737814_orig.jpg)
She wears a thong
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That's the place.
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What is scary is that a casino is the second largest employer in the state. I can think of no less worthy or productive endeavor. Gambling does nothing from a wealth/value generation standpoint; it is really just moving sand between buckets. I am surprised there are more employed in CT at a casino than GE. GE has a lot of intellectual capital in that footprint.
It is perfectly acceptable to speak derogatorily about the expansion of gambling beyond the borders of land better suited for nuclear testing and alien autopsies because it was the same which facilitated and directly contributed to the demise of our beloved Warrior moniker. There's absolutely no need to bring the logic and economic truths of sand and buckets to Scoop.
That said, the majority of people in this country are better suited to employment at a casino than the likes of GE (or even more so, UTC), and CT is no exception. Perhaps we should be thankful that we don't live in an alternate world where affirmative action exists not for the benefit of race but strictly for those with inferior intelligence... the otherwise common blackjack dealer might have been the one working quality control on the the power plants for said airframes you've flown. In which case, God only knows what we'd be talking about right now.
In short, I like casinos.
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It is perfectly acceptable to speak derogatorily about the expansion of gambling beyond the borders of land better suited for nuclear testing and alien autopsies because it was the same which facilitated and directly contributed to the demise of our beloved Warrior moniker. There's absolutely no need to bring the logic and economic truths of sand and buckets to Scoop.
That said, the majority of people in this country are better suited to employment at a casino than the likes of GE (or even more so, UTC), and CT is no exception. Perhaps we should be thankful that we don't live in an alternate world where affirmative action exists not for the benefit of race but strictly for those with inferior intelligence... the otherwise common blackjack dealer might have been the one working quality control on the the power plants for said airframes you've flown. In which case, God only knows what we'd be talking about right now.
In short, I like casinos.
I am not a gambler so Casinos have never held any appeal for this old Warthog driver. We used to go to Nellis AFB outside of LV for Red Flag exercises. They housed us off base in the big casino hotels which the Capts and Lts loved as The Strip was certainly a Target Rich Environment for a 26 year old fighter puke (they enjoyed playing a different form of slots...)
Anyhow, I hated having to walk all through the casino to get to the hotel elevators. The air was so thick with cigarette smoke that your eyes would burn and our nomex flight suits soaked up all that rich tobacco aroma so that we stunk like ashtrays. But man, the flying in a Red Flag was the most Sh1t Hot aviating this side of combat. God help me but I love it so.
(http://aircraft-photographs.s3-website-eu-west-1.amazonaws.com/aircraft-USAF-Fairchild-Republic-A10-Thunderbolt-Warthog-Ground-Attack-Aircraft-hog.jpg)
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I am not a gambler so Casinos have never held any appeal for this old Warthog driver. We used to go to Nellis AFB outside of LV for Red Flag exercises. They housed us off base in the big casino hotels which the Capts and Lts loved as The Strip was certainly a Target Rich Environment for a 26 year old fighter puke (they enjoyed playing a different form of slots...)
Anyhow, I hated having to walk all through the casino to get to the hotel elevators. The air was so thick with cigarette smoke that your eyes would burn and our nomex flight suits soaked up all that rich tobacco aroma so that we stunk like ashtrays. But man, the flying in a Red Flag was the most Sh1t Hot aviating this side of combat. God help me but I love it so.
(http://aircraft-photographs.s3-website-eu-west-1.amazonaws.com/aircraft-USAF-Fairchild-Republic-A10-Thunderbolt-Warthog-Ground-Attack-Aircraft-hog.jpg)
Man... you AF flyboys are way too classy and eloquent. I can only imagine how flowery your anti-exposure suits must be. ;D
Someone tipped me off prior to my taking of the ASTB in the early 2000s that answering the questions as though you were a former juvenile delinquent - particularly affirmative responses to the ones about "do you ocassonally speed just for the thrill of it" and "does taking a risk excite you" - would actually yield a better OAR score. I'm sure Vegas isn't a fan of it, but maybe there's logic in having Nellis right outside town but Fallon a few hours away.
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Man... you AF flyboys are way too classy and eloquent. I can only imagine how flowery your anti-exposure suits must be. ;D
Someone tipped me off prior to my taking of the ASTB in the early 2000s that answering the questions as though you were a former juvenile delinquent - particularly affirmative responses to the ones about "do you ocassonally speed just for the thrill of it" and "does taking a risk excite you" - would actually yield a better OAR score. I'm sure Vegas isn't a fan of it, but maybe there's logic in having Nellis right outside town but Fallon a few hours away.
I hear you Navy guys usually use crayons for the ASTB so anyone using a pen gets extra credit... My favorite was the Psych battery test. The more psychotic you were the better airframe you got. An example of the obtuseness of the questions is, "I loved my mother."
I've logged time at Fallon. Warthogs fly aggressor strike missions out of there for Red Flag. I know a lot of the younger guys got their Mustang Ranch qual while at Fallon. I did a SAR run one night for some Captains who had a sudden attack of conscience.
(http://imgc.allpostersimages.com/images/P-473-488-90/60/6003/FQBB100Z/posters/matthew-diffee-sorry-he-s-been-cursing-like-that-ever-since-we-put-him-in-that-little-new-yorker-cartoon.jpg)
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I hear you Navy guys usually use crayons for the ASTB so anyone using a pen gets extra credit... My favorite was the Psych battery test. The more psychotic you were the better airframe you got. An example of the obtuseness of the questions is, "I loved my mother."
I've logged time at Fallon. Warthogs fly aggressor strike missions out of there for Red Flag. I know a lot of the younger guys got their Mustang Ranch qual while at Fallon. I did a SAR run one night for some Captains who had a sudden attack of conscience.
To be clear (and to not purport to be something I'm not), I only took the ASTB; I was booted during my pre-comm at Great Lakes... evidently, my right eye wasn't quite as sharp as I thought it was (20/50). Incidentally, I came to find out much later that the USAF would have welcomed me with open arms when my cousin - who was reserve USMC during college and has worse vision than I do - got accepted to OTS. So instead of being a grunt in a Jump Jet, he's now a KC-135 bus driver, and I'm just damn good at giving him sh%# about it. He's on deployment right now, so I appreciate you helping me keep my skills sharp.
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To be clear (and to not purport to be something I'm not), I only took the ASTB; I was booted during my pre-comm at Great Lakes... evidently, my right eye wasn't quite as sharp as I thought it was (20/50). Incidentally, I came to find out much later that the USAF would have welcomed me with open arms when my cousin - who was reserve USMC during college and has worse vision than I do - got accepted to OTS. So instead of being a grunt in a Jump Jet, he's now a KC-135 bus driver, and I'm just damn good at giving him sh%# about it. He's on deployment right now, so I appreciate you helping me keep my skills sharp.
The Navy has always had the tougher eye test. You experienced the NAMI Whammy which is an anal assault through the eye socket. The best score ever recorded on the Navy eye test was by Ted Williams. People might not know The Splinter was a Marine fighter pilot who served in both WW2 and Korea. Imagine his numbers if he didn't miss those seasons in his prime.
Be sure to let your cousin know that he passes gas for a living. Those guys form the sky bridge that keeps the 24/7 airlift moving. While not as glamorous as flying a fast mover it is a critical link in our strategic superiority.
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The Navy has always had the tougher eye test. You experienced the NAMI Whammy which is an anal assault through the eye socket. The best score ever recorded on the Navy eye test was by Ted Williams. People might not know The Splinter was a Marine fighter pilot who served in both WW2 and Korea. Imagine his numbers if he didn't miss those seasons in his prime.
Be sure to let your cousin know that he passes gas for a living. Those guys form the sky bridge that keeps the 24/7 airlift moving. While not as glamorous as flying a fast mover it is a critical link in our strategic superiority.
The splendid one will be back in 100 years when he thaws out from cryogenics.
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The splendid one will be back in 100 years when he thaws out from cryogenics.
Well at least the top part of him.
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The splendid one will be back in 100 years when he thaws out from cryogenics.
Certainly one of the most morbidly grotesque family sagas out there. I believe Walt Disney is also kept in the same cryogenic facility. There is a doleful pathos about such desperation. Just a small measure of poise and grace serves one's memory far better than wistful lunacy.
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I believe Walt Disney is also kept in the same cryogenic facility.
That's a myth. I was just up at Disney studios for work, and asked about that myself.
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That's a myth. I was just up at Disney studios for work, and asked about that myself.
Correct....as a former employee of Disney (Angels and Mighty Ducks), I can confirm.
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Correct....as a former employee of Disney (Angels and Mighty Ducks), I can confirm.
Is his unfrozen head on display somewhere that only Disney employees are allowed?
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Correct....as a former employee of Disney (Angels and Mighty Ducks), I can confirm.
Chico
What is correct? That Walt's head is in storage or that the story is a myth? Is Walt Disney's Cranial Disposition part of New Employee Orientation? While nowhere near enthralling as the Richard Gere Gerbil Legend it would be a damn shame to ruin a perfectly wonderful cocktail anecdote.
(http://imgc.allpostersimages.com/images/P-473-488-90/60/6002/XDBB100Z/posters/peter-steiner-i-hear-they-can-freeze-you-until-they-discover-a-cure-new-yorker-cartoon.jpg)
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Is his unfrozen head on display somewhere that only Disney employees are allowed?
He was cremated....but fun stories abound where his ashes are buried.
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Chico
What is correct? That Walt's head is in storage or that the story is a myth? Is Walt Disney's Cranial Disposition part of New Employee Orientation? While nowhere near enthralling as the Richard Gere Gerbil Legend it would be a damn shame to ruin a perfectly wonderful cocktail anecdote.
(http://imgc.allpostersimages.com/images/P-473-488-90/60/6002/XDBB100Z/posters/peter-steiner-i-hear-they-can-freeze-you-until-they-discover-a-cure-new-yorker-cartoon.jpg)
He was not frozen, he was embalmed two days after death for his wake. Then cremated and buried at Forest Lawn in Glendale, CA.
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He was not frozen, he was embalmed two days after death for his wake. Then cremated and buried at Forest Lawn in Glendale, CA.
Chico
If this is true then how is it that Disney's dying words were, "Kurt Russell?" There is something very sinister about this.
And how do you explain Walt Disney's Quest for Global Domination?
http://www.jinxmagazine.com/disney.html
(http://imgc.allpostersimages.com/images/P-473-488-90/59/5999/RUPQG00Z/posters/frank-modell-mickey-mouse-reading-a-english-french-dictionary-refers-to-the-recent-an-new-yorker-cartoon.jpg)
(https://encrypted-tbn1.gstatic.com/images?q=tbn:ANd9GcT2-4h5w03ZQSUG0BuZmZeNG6gmITsIYozJlkMCGcOJU2UqDl6V2w)
(http://assets.nydailynews.com/polopoly_fs/1.1327789!/img/httpImage/image.jpg_gen/derivatives/landscape_635/167372323.jpg)
(http://t2.gstatic.com/images?q=tbn:ANd9GcR-hEnoO_iu6NvugW_jWhQkglMbHcbNTXhq2MLHgD3y_p4hn4cc)
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http://www.nytimes.com/2013/06/13/business/media/gatekeepers-of-cable-tv-try-to-stop-intel.html?ref=technology&_r=0
no monopolies here... nope... nothing at all but us poor cable companies...
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http://www.nytimes.com/2013/06/13/business/media/gatekeepers-of-cable-tv-try-to-stop-intel.html?ref=technology&_r=0
no monopolies here... nope... nothing at all but us poor cable companies...
The State of Wisconsin once banned the sale of "Oleo," seeing it s a threat to the dairy industry.
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I recall the oleo runs to IL in my youth with my parents smuggling contraband across the IL/WI border
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Chico
If this is true then how is it that Disney's dying words were, "Kurt Russell?" There is something very sinister about this.
And how do you explain Walt Disney's Quest for Global Domination?
http://www.jinxmagazine.com/disney.html
"Kurt Russell... make sure you keep casting him... must make him forget... about Fred MacMurray's advances."
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I recall the oleo runs to IL in my youth with my parents smuggling contraband across the IL/WI border
I seem to recall that when WI finally allowed oleo sales it forbade the use of yellow dye so that margarine was an industrial gray color. Government's patronizing oversight is ridiculous if not insulting.
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Chico
If this is true then how is it that Disney's dying words were, "Kurt Russell?" There is something very sinister about this.
And how do you explain Walt Disney's Quest for Global Domination?
http://www.jinxmagazine.com/disney.html
(http://assets.nydailynews.com/polopoly_fs/1.1327789!/img/httpImage/image.jpg_gen/derivatives/landscape_635/167372323.jpg)
Kurt was my assistant Little League coach in Thousand Oaks, CA about 35 years ago. His sister, Jill, was our head coach (she was married to Larry Franco...producer of Batman movies, Whitehouse Down, Jurassic Park, etc). Jill's son, Matt Franco was on my Little League team and eventually played for the Chicago Cubs, New York Mets and Atlanta Braves (ultimately caught up in the Mitchell report). Kurt, in his own right was a very solid baseball player. A few years later, my sister (an outstanding softball pitcher) played with Matt's sister throughout high school (Kurt's niece) and Kurt would bring Goldie Hawn to the games. Down to earth guy, very pleasant...just one of the boys.
An article from the LA Times when we were in high school. http://articles.latimes.com/1987-07-01/sports/sp-508_1_minor-league-baseball
To this day, if you watch a Kurt Russell movie that Larry Franco was involved in (Escape from New York, the Thing, etc) watch the entire credit listing and you can see Matt Franco listed as an "assistant to the assistants". Trivia you can only get here boys and girls.
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Sponsored by the same industry that made sure WI had butter yellow license plates for years. IIRC it took changing the state constitution to change the plate color to anything but yellow
I seem to recall that when WI finally allowed oleo sales it forbade the use of yellow dye so that margarine was an industrial gray color. Government's patronizing oversight is ridiculous if not insulting.
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Like I said, we would do a la carte very easily, but the media companies make it financially impossible.
Testifying in front of Congress yesterday...one of my bosses.
http://www.latimes.com/entertainment/envelope/cotown/la-et-ct-directv-executive-blasts-broadcasters-congress-20130612,0,7516703.story
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Like I said, we would do a la carte very easily, but the media companies make it financially impossible.
Testifying in front of Congress yesterday...one of my bosses.
http://www.latimes.com/entertainment/envelope/cotown/la-et-ct-directv-executive-blasts-broadcasters-congress-20130612,0,7516703.story
Wow. Is the public position of DirecTV in favor of government enforced ala carte?
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http://www.nytimes.com/2013/06/13/business/media/gatekeepers-of-cable-tv-try-to-stop-intel.html?ref=technology&_r=0
no monopolies here... nope... nothing at all but us poor cable companies...
They're not monopolies, they have to compete with two major satellite companies as well as the phone companies. What is at play here are MFNs.
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They're not monopolies, they have to compete with two major satellite companies as well as the phone companies. What is at play here are MFNs.
Not entirely accurate. The cables were granted territorial exclusivity, thereby giving them market monopolies. Challenges through choice came only later with tech innovation in the form of satellite then OTT Content delivery.
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Not entirely accurate. The cables were granted territorial exclusivity, thereby giving them market monopolies. Challenges through choice came only later with tech innovation in the form of satellite then OTT Content delivery.
Yes, territorial (or franchise) monopolies which they pay dearly for. My point is that just because they have a franchise territory (which they bid and paid for from the gov't), a citizen does not have to use them. They have two satellite options, a telco option, rabbit ears, OTT, etc.
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Wow. Is the public position of DirecTV in favor of government enforced ala carte?
I believe his point was fairly clear, the laws put on the books years ago in the form of "MUST CARRY" and other such laws (SHVERA) have resulted in much of the mess the public hates now. Fix the laws.
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You would think that at some point, one of the cable network families (because no one has just one cable network anymore) goes rogue and decides to offer a la carte. Hypothetically, let's say Viacom.
So DTV, Dish, Comcast, TW, Brighthouse, etc. start offering an a la carte option that offers any combination (or all) of Comedy Central, Logo, BET, Spike, TV Land, Nick at Nite, Nickelodeon, TeenNick, Nicktoons., Nick Jr., MTV, VH1, MTV2, Tr3s, CMT, & Palladia for - say - $6.95/mo for 1, $12.95 for any 4, $15.95 for 8, or $19.95 for all 16 -- in lieu of a full cable/sat package. IMO, that's something that would appeal to many households with children and teens - personally, I would certainly reattach the cable for a 4-pack. Some of the smaller networks who get a mere penny or two per subscriber now see opportunity for growth and decide to put their offerings on a la carte. With expanded options, more and more households drop the full package for a la carte. But there's one holdout -- the conglomerate who makes the most from per subscriber fees: The Mouse. So Mickey and Minnie start seeing their subscriber numbers fall and are forced to either i) cut per subscriber fees or ii) start offering a la carte. Disney and others never wanted a la carte and never would have gone a la carte voluntarily, but they ended up being forced into doing so.
That's how this goes down -- it's not a matter of changing laws, it's a matter of time before the first network figures out how to be profitable in a la carte... the rest of the dominoes will fall in time.
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I recall the oleo runs to IL in my youth with my parents smuggling contraband across the IL/WI border
My dad did that for his clients.
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You would think that at some point, one of the cable network families (because no one has just one cable network anymore) goes rogue and decides to offer a la carte. Hypothetically, let's say Viacom.
So DTV, Dish, Comcast, TW, Brighthouse, etc. start offering an a la carte option that offers any combination (or all) of Comedy Central, Logo, BET, Spike, TV Land, Nick at Nite, Nickelodeon, TeenNick, Nicktoons., Nick Jr., MTV, VH1, MTV2, Tr3s, CMT, & Palladia for - say - $6.95/mo for 1, $12.95 for any 4, $15.95 for 8, or $19.95 for all 16 -- in lieu of a full cable/sat package. IMO, that's something that would appeal to many households with children and teens - personally, I would certainly reattach the cable for a 4-pack. Some of the smaller networks who get a mere penny or two per subscriber now see opportunity for growth and decide to put their offerings on a la carte. With expanded options, more and more households drop the full package for a la carte. But there's one holdout -- the conglomerate who makes the most from per subscriber fees: The Mouse. So Mickey and Minnie start seeing their subscriber numbers fall and are forced to either i) cut per subscriber fees or ii) start offering a la carte. Disney and others never wanted a la carte and never would have gone a la carte voluntarily, but they ended up being forced into doing so.
That's how this goes down -- it's not a matter of changing laws, it's a matter of time before the first network figures out how to be profitable in a la carte... the rest of the dominoes will fall in time.
Let me explain why that doesn't happen. First, it could happen, but I would expect it to be with an independent network that folks largely don't care about.
For someone like Viacom, they are generating BILLIONS of dollars from all the distributors. If it made financial sense for them to go a la carte, they would do it in a heartbeat, but these are not stupid people. They know they wouldn't come close to making the money they are today....money needed to drive the creation of their current content. It just isn't there. This is simple mathematics - economics undergraduate stuff. The math doesn't fly...not today. Maybe some day, but not today.
And for all the lost revenue from distributors would force them to charge even more a la carte....so instead of $5.50 of your current cable or satellite bill going to ESPN, you will pay $15 or $20 for that same channel....thus pushing a lot of people on the fringe out as possible customers.
In our major Viacom dispute last Summer where we took them off the air for 8 or 9 days, we flat out told Viacom sell the channels to us a la carte so we can sell them that way to our customers. They basically give you that option but make it so price onerous as to not make sense. For example, you get all the Viacom channels for $1 billion a year or you can buy them individually that all add up to $2 billion.
Apple hasn't figured it out. Intel hasn't figured it out. Samsung hasn't figured it out. Neither have any of the distribution companies. It starts at the content companies, been saying that for years.
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Like I said, we would do a la carte very easily, but the media companies make it financially impossible.
Testifying in front of Congress yesterday...one of my bosses.
http://www.latimes.com/entertainment/envelope/cotown/la-et-ct-directv-executive-blasts-broadcasters-congress-20130612,0,7516703.story
one of my bosses is on a radio commercial in Madison.
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one of my bosses is on a radio commercial in Madison.
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Ziggy you still schlepping schlock for Crazy TV Lenny?
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Let me explain why that doesn't happen. First, it could happen, but I would expect it to be with an independent network that folks largely don't care about.
For someone like Viacom, they are generating BILLIONS of dollars from all the distributors. If it made financial sense for them to go a la carte, they would do it in a heartbeat, but these are not stupid people. They know they wouldn't come close to making the money they are today....money needed to drive the creation of their current content. It just isn't there. This is simple mathematics - economics undergraduate stuff. The math doesn't fly...not today. Maybe some day, but not today.
And for all the lost revenue from distributors would force them to charge even more a la carte....so instead of $5.50 of your current cable or satellite bill going to ESPN, you will pay $15 or $20 for that same channel....thus pushing a lot of people on the fringe out as possible customers.
In our major Viacom dispute last Summer where we took them off the air for 8 or 9 days, we flat out told Viacom sell the channels to us a la carte so we can sell them that way to our customers. They basically give you that option but make it so price onerous as to not make sense. For example, you get all the Viacom channels for $1 billion a year or you can buy them individually that all add up to $2 billion.
Apple hasn't figured it out. Intel hasn't figured it out. Samsung hasn't figured it out. Neither have any of the distribution companies. It starts at the content companies, been saying that for years.
You never read the story about The Little Engine That Could, did you? You could be that little engine, Chicos. Do you always want to be known as some random DirecTV employee, or do you want to be the notorious underdog who took on the giants and changed the landscape of TV as we know it?
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You never read the story about The Little Engine That Could, did you? You could be that little engine, Chicos. Do you always want to be known as some random DirecTV employee, or do you want to be the notorious underdog who took on the giants and changed the landscape of TV as we know it?
(http://imgc.allpostersimages.com/images/P-473-488-90/60/6069/5YYD100Z/posters/mick-stevens-superman-s-final-years-new-yorker-cartoon.jpg)
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You never read the story about The Little Engine That Could, did you? You could be that little engine, Chicos. Do you always want to be known as some random DirecTV employee, or do you want to be the notorious underdog who took on the giants and changed the landscape of TV as we know it?
Ah yes, and put 100's of thousands of people out of work in the process. Tank quality products because the well will dry up to create anything of quality. Drive down revenues for leagues like the Big East in the process. What a great legacy. At the end of the day, it's the studios and programmers that will make this call, but I doubt very much they are going to do it based on their shareholders, commitments over the next 15 years, etc. We're happy to sell it a la carte, but if those creating it aren't offering it economically in that vein, impossible for us to do.
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Ah yes, and put 100's of thousands of people out of work in the process. Tank quality products because the well will dry up to create anything of quality. Drive down revenues for leagues like the Big East in the process. What a great legacy. At the end of the day, it's the studios and programmers that will make this call, but I doubt very much they are going to do it based on their shareholders, commitments over the next 15 years, etc. We're happy to sell it a la carte, but if those creating it aren't offering it economically in that vein, impossible for us to do.
Just curious Chicos, you don't have to give specifics but how far up in DirecTV are you?
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Just curious Chicos, you don't have to give specifics but how far up in DirecTV are you?
"Clean up in Aisle 5!"
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Ah yes, and put 100's of thousands of people out of work in the process. Tank quality products because the well will dry up to create anything of quality. Drive down revenues for leagues like the Big East in the process. What a great legacy. At the end of the day, it's the studios and programmers that will make this call, but I doubt very much they are going to do it based on their shareholders, commitments over the next 15 years, etc. We're happy to sell it a la carte, but if those creating it aren't offering it economically in that vein, impossible for us to do.
Would you rather be one of the "100's of thousands" without a job, or would you rather be the guy who gets to sign the $multiMM book deal for putting those people out of work?
Of course it's a rhetorical question, but feel free to search your soul.
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Let's just get rid of ATM's since they cost people jobs too, right, Chicos?
Unbelievable.
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BTW, I absolutely weep for the people who are making their living off America's addiction to garbage television that will go away once it is clear that the market no longer supports it. I weep tears of unfathomable sadness for them.
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Let's just get rid of ATM's since they cost people jobs too, right, Chicos?
Unbelievable.
LOL. I think you're missing the point. ATMs are a widget, that can do the job more efficiently than a teller. You can't just come off the street and create a machine or widget that is a writer, producer, director, actor, etc to create entertainment. I'm talking about lost jobs because they are unique jobs, highly skilled in creativity that not every Tom, Dick and Nancy can do, but if the money isn't there to create the content they go bye bye.
I really do think you are missing the point entirely on this because you and so many others continue to think the entertainment or sports industries are the same as creating a crankshaft or an insurance policy or what have you. There's a reason why elite actors get paid what they do, a reason why elite writers do, why elite ball players do, because there are so few out there...people pay to watch or see their craft, and that leads to a niche industry that costs a lot of money.
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RIP to James Gandolfini...my HBO brethren are in mourning right now....or more like it, they are stunned, including Chris Albrecht (now head of Starz).
RIP
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Would you rather be one of the "100's of thousands" without a job, or would you rather be the guy who gets to sign the $multiMM book deal for putting those people out of work?
Of course it's a rhetorical question, but feel free to search your soul.
I'd rather be one of the people that every day works to bring sports, news, entertainment of all kinds for your viewing pleasure on the television, phone, tablet, computer to the tune of 100's of channels daily, 24/7 at an average cost of about $3 per day. I enjoy being one of those people that can entertain you, your wife, your kids, can help educate them, deliver the world, or just deliver stupidity (if that's what you crave) to unwind. All at the press of a button for less than the cost of a Starbucks...every day, every hour, every minute.
If you like sports, it's there. You want porn, it's there. You want religious programming, it's there. History, education, movies, news, ethnic, music....it's there. For a few dollars a day. And in the process, the revenues generated flow downstream to help more content to be created, enrich my alma maters, push leading edge technologies like HD, 4K, DVRs, interactivity, etc...all to make your life and others happier.
My soul searching is done.
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push leading edge technologies like HD, 4K, DVRs, interactivity, etc...
Virtually all electronic technical innovation is due to the military-industrial complex churning out toys for Natural Born Killers. The fact there are significant consumer applications redeems the investment of so much national treasure into an otherwise non-productive capital consuming vortex. The entertainment industry is not in the vanguard of scientific and engineering vicissitude.
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Just curious Chicos, you don't have to give specifics but how far up in DirecTV are you?
As Keefe said, I just sweep the floors and read everyone's notes when they leave for the day...kind of like the janitor on Good Will Hunting. ;)
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Virtually all electronic technical innovation is due to the military-industrial complex churning out toys for Natural Born Killers. The fact there are significant consumer applications redeems the investment of so much national treasure into an otherwise non-productive capital consuming vortex. The entertainment industry is not in the vanguard of scientific and engineering vicissitude.
Never claimed it was and I absolutely agree with you that the military creates many of the early toys that are out there...with the R&D that Uncle Sammy provides both directly and indirectly to the M.I.C., it's not a surprise.
All that being said, we (the industry) has some pretty awesome patents of our own over the years. Some of which are on the coattails of what the military has done, and some that are unique from day one.
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As Keefe said, I just sweep the floors and read everyone's notes when they leave for the day...kind of like the janitor on Good Will Hunting. ;)
Yea but the janitor was really smart, right??
Actually, you have a fun job in an important vertical in the cash cow that is DTV. Much too important for a Crean lover I should think.
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Yea but the janitor was really smart, right??
Actually, you have a fun job in an important vertical in the cash cow that is DTV. Much too important for a Crean lover I should think.
Not a Crean lover, just despise the hypocrisy here and happy to point it out.
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I'd rather be one of the people that every day works to bring sports, news, entertainment of all kinds for your viewing pleasure on the television, phone, tablet, computer to the tune of 100's of channels daily, 24/7 at an average cost of about $3 per day. I enjoy being one of those people that can entertain you, your wife, your kids, can help educate them, deliver the world, or just deliver stupidity (if that's what you crave) to unwind. All at the press of a button for less than the cost of a Starbucks...every day, every hour, every minute.
If you like sports, it's there. You want porn, it's there. You want religious programming, it's there. History, education, movies, news, ethnic, music....it's there. For a few dollars a day. And in the process, the revenues generated flow downstream to help more content to be created, enrich my alma maters, push leading edge technologies like HD, 4K, DVRs, interactivity, etc...all to make your life and others happier.
My soul searching is done.
I've seen lots of horse manure shoveled in my life, but this post is the most self serving, self important piece of garbage I've seen in a long, long time. Stunning in its arrogance.
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I've seen lots of horse manure shoveled in my life, but this post is the most self serving, self important piece of garbage I've seen in a long, long time. Stunning in its arrogance.
Hubris. Don't forget hubris, Mr Bernstein.
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I've seen lots of horse manure shoveled in my life, but this post is the most self serving, self important piece of garbage I've seen in a long, long time. Stunning in its arrogance.
Par for the course.
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Hubris. Don't forget hubris, Mr Bernstein.
Amen, brother Keefe.
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LOL. I think you're missing the point. ATMs are a widget, that can do the job more efficiently than a teller. You can't just come off the street and create a machine or widget that is a writer, producer, director, actor, etc to create entertainment. I'm talking about lost jobs because they are unique jobs, highly skilled in creativity that not every Tom, Dick and Nancy can do, but if the money isn't there to create the content they go bye bye.
I really do think you are missing the point entirely on this because you and so many others continue to think the entertainment or sports industries are the same as creating a crankshaft or an insurance policy or what have you. There's a reason why elite actors get paid what they do, a reason why elite writers do, why elite ball players do, because there are so few out there...people pay to watch or see their craft, and that leads to a niche industry that costs a lot of money.
I get your point here, but people are working on replacing writer's, producers, actors etc (and likely will eventually succeed as crazy as that sounds). Also, as Spielberg recently said, the entertainment industry is broken and will see major changes. Creativity has gone the way of the dinosaur most of the time in high-end entertainment...too much of a risk.
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If you like sports, it's there. You want porn, it's there. You want religious programming, it's there. History, education, movies, news, ethnic, music....it's there. For a few dollars a day. And in the process, the revenues generated flow downstream to help more content to be created, enrich my alma maters, push leading edge technologies like HD, 4K, DVRs, interactivity, etc...all to make your life and others happier.
The tragic flaw in your soliloquy is that DirecTV is the laggard when it comes to new technologies. DTV simply took a 1960's idea, adapted it for early-90's technology, and has been milking that cow ever since... at least your neighbor in Englewood, CO is pumping some rBGH into their cow.
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All that being said, we (the industry) has some pretty awesome patents of our own over the years. Some of which are on the coattails of what the military has done, and some that are unique from day one.
Were you the guys behind that movie theatre gizmo that gets the Faux Butter throughout the whole Large Popcorn Tub?
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Were you the guys behind that movie theatre gizmo that gets the Faux Butter throughout the whole Large Popcorn Tub?
No, that was the military too
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All that being said, we (the industry) has some pretty awesome patents of our own over the years. Some of which are on the coattails of what the military has done, and some that are unique from day one.
We (the planet) are forever in your debt.
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No, that was the military too
Death by clogged artery...
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The tragic flaw in your soliloquy is that DirecTV is the laggard when it comes to new technologies. DTV simply took a 1960's idea, adapted it for early-90's technology, and has been milking that cow ever since... at least your neighbor in Englewood, CO is pumping some rBGH into their cow.
Uh, ok. This company? http://www.businessweek.com/articles/2013-01-02/dish-network-the-meanest-company-in-america
http://www.theverge.com/2013/1/4/3835670/what-makes-dish-network-the-worst-company-to-work-for-in-america
They're having trouble just keeping people there.
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Back to the original thread...simple math
http://techcrunch.com/2012/09/11/citing-the-math-hbos-alison-moore-says-there-are-still-no-plans-for-standalone-hbo-go-in-the-u-s/
http://allthingsd.com/20130322/hbo-explains-why-its-not-going-a-la-carte-any-time-soon/
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From today
A La Carte ESPN Would Cost Consumers $30 Per Month While Industry Could Lose $13B
Published July 16, 2013
Research shows 20% of pay-TV subscribers would pay for ESPN if a la carte
ESPN would "cost vastly more for sports fans, about $30 a month, if it was unbundled from the pay-TV package and sold separately only to those who wanted to watch it," according to Bob Fernandez of the PHILADELPHIA INQUIRER. That would be "five times the $6 a month" that ESPN now costs as part of the "big TV bundles offered by cablecasters such as Comcast." Fans that would choose ESPN at the increased cost "would be unlikely to purchase non-sports entertainment channels, leading to billions of dollars in lost revenue." Needham Co. analyst Laura Martin yesterday released her Future of TV report, the "latest contribution to the public debate in Washington and within the TV industry on skyrocketing TV sports costs and what to do about them." Martin said that 20 million pay-TV subscribers, or "one in five, would choose to purchase ESPN if they had the option." This "falls below the 25 million subscribers that many national advertisers seek on pay-TV systems, so ESPN would lose substantial ad revenue." She estimated that "unbundling ESPN could result" in $13B in lost revenue of the pay-TV industry's total $150B revenue per year "because of a cascading effect of lost advertising revenue and ESPN fans not selecting to purchase non-sports channels." Martin said, "This has to be solved, and these negotiators have to figure out how to keep (sports cable channels) in the bundle" (PHILADELPHIA INQUIRER, 7/16). CABLEFAX DAILY reports sports "accounts for about 50% of sub fees and accounts for less than 25% of total viewing." Martin in her report wrote, "We can find no math where unbundling is the best economic answer" (CABLEFAX DAILY, 7/16).
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But there's no way they could get $30. Why? Because people won't pay $30, so they'll have to cut it back to ~$10. They might actually pick up some customers at $10 that they wouldn't have at $30. Same as any other product out there. Market economics really isn't that difficult.
I await the gnashing of teeth when this inevitable day comes and the ESPN's of the world are taken down a few notches.
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But there's no way they could get $30. Why? Because people won't pay $30, so they'll have to cut it back to ~$10. They might actually pick up some customers at $10 that they wouldn't have at $30. Same as any other product out there. Market economics really isn't that difficult.
+1
It's like ESPN forgot how supply and demand works.
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From today
A La Carte ESPN Would Cost Consumers $30 Per Month While Industry Could Lose $13B
Published July 16, 2013
Research shows 20% of pay-TV subscribers would pay for ESPN if a la carte
ESPN would "cost vastly more for sports fans, about $30 a month, if it was unbundled from the pay-TV package and sold separately only to those who wanted to watch it," according to Bob Fernandez of the PHILADELPHIA INQUIRER. That would be "five times the $6 a month" that ESPN now costs as part of the "big TV bundles offered by cablecasters such as Comcast." Fans that would choose ESPN at the increased cost "would be unlikely to purchase non-sports entertainment channels, leading to billions of dollars in lost revenue." Needham Co. analyst Laura Martin yesterday released her Future of TV report, the "latest contribution to the public debate in Washington and within the TV industry on skyrocketing TV sports costs and what to do about them." Martin said that 20 million pay-TV subscribers, or "one in five, would choose to purchase ESPN if they had the option." This "falls below the 25 million subscribers that many national advertisers seek on pay-TV systems, so ESPN would lose substantial ad revenue." She estimated that "unbundling ESPN could result" in $13B in lost revenue of the pay-TV industry's total $150B revenue per year "because of a cascading effect of lost advertising revenue and ESPN fans not selecting to purchase non-sports channels." Martin said, "This has to be solved, and these negotiators have to figure out how to keep (sports cable channels) in the bundle" (PHILADELPHIA INQUIRER, 7/16). CABLEFAX DAILY reports sports "accounts for about 50% of sub fees and accounts for less than 25% of total viewing." Martin in her report wrote, "We can find no math where unbundling is the best economic answer" (CABLEFAX DAILY, 7/16).
Imagine that: a report on why unbundling ESPN is bad for everyone authored by.... wait for it.... a Disney consultant.
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Imagine that: a report on why unbundling ESPN is bad for everyone authored by.... wait for it.... a Disney consultant.
Incorrect.
Needham is an investment banking firm among other things. Martin is an expert in this area, who also researches Discovery, News Corp, Viacom, CBS, Scripps, Disney along with a bunch of other companies like AOL, Time Warner, Facebook, Yahoo, Nielsen, etc. I'd hardly call her a Disney consultant, that would imply she is paid by Disney to consult them. She is not. She understands this sector and advises institutional investors why or why not to invest in them. Smart as a whip...Harvard Business School, Stanford, etc.
If you wish to peruse her resume, here you go
http://www.capknowledge.com/docs/07_18_11_LAM_Resume.pdf
I can give you 30 to 50 economists that have said the same thing about the math, Congressional investigators, etc, etc. The math doesn't work. I don't see the networks or studios doing it. Like I've said, we would be happy to offer it a la carte, but we can't. They won't let us because the math doesn't work.
Supply and demand would be cool. I can only suggest one contact Mr. Redstone, Mr. Iger, Mr. Murdoch, etc, etc.
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It's coming whether you want it to or not. Unless you can make the case that welfare recipients should be able to pay their welfare checks toward DTV et. al, the ever shrinking part of the population with disposable income is not going to pay $100++/mo. for a television package when the few alternatives (Netflix, Hulu) keep coming out. Maybe we can get the Obama phone people to work up an Obama TV program.
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Incorrect.
Needham is an investment banking firm among other things. Martin is an expert in this area, who also researches Discovery, News Corp, Viacom, CBS, Scripps, Disney along with a bunch of other companies like AOL, Time Warner, Facebook, Yahoo, Nielsen, etc. I'd hardly call her a Disney consultant, that would imply she is paid by Disney to consult them. She is not. She understands this sector and advises institutional investors why or why not to invest in them. Smart as a whip...Harvard Business School, Stanford, etc.
If you wish to peruse her resume, here you go
http://www.capknowledge.com/docs/07_18_11_LAM_Resume.pdf
I can give you 30 to 50 economists that have said the same thing about the math, Congressional investigators, etc, etc. The math doesn't work. I don't see the networks or studios doing it. Like I've said, we would be happy to offer it a la carte, but we can't. They won't let us because the math doesn't work.
Supply and demand would be cool. I can only suggest one contact Mr. Redstone, Mr. Iger, Mr. Murdoch, etc, etc.
Perhaps I misspoke.... what I should have said was published or commissioned by a Disney consultant. An i-Stalker with top notch Google-Wikipedia skillz such as yourself should have been able to ascertain the relationship that exists between Needham and Disney.
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Perhaps I misspoke.... what I should have said was published or commissioned by a Disney consultant. An i-Stalker with top notch Google-Wikipedia skillz such as yourself should have been able to ascertain the relationship that exists between Needham and Disney.
Laura Martin isn't a Disney consultant. This wasn't commissioned by a Disney consultant nor is Needham & Company a Disney consultant (at least not in this space). We've heard Laura's presentations for many years, she's very good (not hard on the eyes either). Needham, in this role at least, is an investment firm \ asset management company. This is why when she talks about buy, hold, neutral, sell, etc ratings on Disney and other companies, she carries some weight. In fact, Needham put a hold on Disney today. As a Disney shareholder (and former employee), I appreciate her insight and that of Needham. She's a smart cookie.
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Laura Martin isn't a Disney consultant. This wasn't commissioned by a Disney consultant nor is Needham & Company a Disney consultant (at least not in this space). We've heard Laura's presentations for many years, she's very good (not hard on the eyes either). Needham, in this role at least, is an investment firm \ asset management company. This is why when she talks about buy, hold, neutral, sell, etc ratings on Disney and other companies, she carries some weight. In fact, Needham put a hold on Disney today. As a Disney shareholder (and former employee), I appreciate her insight and that of Needham. She's a smart cookie.
I have met Laura Martin. In my role at TMO I worked closely with the Sand Hill Road community and Needham has a presence there. I spoke with Martin at length during a 2 day gathering at Andreessen Horowitz. I presented on how content is driving loyalty in Mobile while she looked at content with a much broader aperture. It is silly to suggest she has an agenda of any sort as she makes her coin by offering an independent, objective, unvarnished view of content across a number of verticals. She is exceptionally bright and carries a lot of heft in that space. And yes, she is not bad to look at in a gracefully aging sort of way.
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That sounds just like Marty Kaan from House of Lies. ;D
I have met Laura Martin. In my role at TMO I worked closely with the Sand Hill Road community and Needham has a presence there. I spoke with Martin at length during a 2 day gathering at Andreessen Horowitz. I presented on how content is driving loyalty in Mobile while she looked at content with a much broader aperture. It is silly to suggest she has an agenda of any sort as she makes her coin by offering an independent, objective, unvarnished view of content across a number of verticals. She is exceptionally bright and carries a lot of heft in that space. And yes, she is not bad to look at in a gracefully aging sort of way.
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That sounds just like Marty Kaan from House of Lies. ;D
Is that the take-off on McKinsey/BCG/Bain with Don Cheadle?
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Is that the take-off on McKinsey/BCG/Bain with Don Cheadle?
that's it
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It's coming whether you want it to or not. Unless you can make the case that welfare recipients should be able to pay their welfare checks toward DTV et. al, the ever shrinking part of the population with disposable income is not going to pay $100++/mo. for a television package when the few alternatives (Netflix, Hulu) keep coming out. Maybe we can get the Obama phone people to work up an Obama TV program.
That's probably why we have launched so many packages so customers can get programming under $60....we realize that, but you can only put so much into those packages due to the cost and still make a profit. At the end of the day, we buy product and distribute it. The prices we pay are set by the content producers (studios, sports leagues, television networks). You just wait to see what happens with the pricing on Netflix and Hulu in the next few years, it's going to make you cry. The studios want their money, and if they aren't getting it from pay TV and people shift to another source, that other source is going to pay the difference and fill the void. We just went through 8 months of due diligence to purchase Hulu. A real eye opener is coming for a lot of people out there than think everything should be FRRRRRRRRRRRREEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE.
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I have met Laura Martin. In my role at TMO I worked closely with the Sand Hill Road community and Needham has a presence there. I spoke with Martin at length during a 2 day gathering at Andreessen Horowitz. I presented on how content is driving loyalty in Mobile while she looked at content with a much broader aperture. It is silly to suggest she has an agenda of any sort as she makes her coin by offering an independent, objective, unvarnished view of content across a number of verticals. She is exceptionally bright and carries a lot of heft in that space. And yes, she is not bad to look at in a gracefully aging sort of way.
DING DING DING.....thank you.
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We just went through 8 months of due diligence to purchase Hulu. A real eye opener is coming for a lot of people out there than think everything should be FRRRRRRRRRRRREEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE.
Maybe I missed it, but I don't think anyone here is asking for anything to be free. It seems the consensus is just that we want to pay for what we want - a la carte purchasing.
Also, I think it's telling that NBC, etc. started up Hulu to get back some of the "cord cutters." Also interesting that Hulu started with very little commercials and usually the choice to watch a 2 minute commercial at the beginning or 2-3 30 second commercials during your show. Now it's 2-3 30 second commercials, 3-4 times per episode. When a company finds a way to make money, they will take it to the nth degree.
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DING DING DING.....thank you.
Again... not talking about Laura, I'm talking about her employer. But there's no way that Needham takes that report public without the mouse's permission. If Ms. Martin wrote it with an opposite message, I guarantee it never sees the light of day.
That's got to be the most frustrating thing about being an independent analyst for a company who has a relationship with your subject... a good portion of your work ends up in the custody of "top men."
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Maybe I missed it, but I don't think anyone here is asking for anything to be free. It seems the consensus is just that we want to pay for what we want - a la carte purchasing.
Also, I think it's telling that NBC, etc. started up Hulu to get back some of the "cord cutters." Also interesting that Hulu started with very little commercials and usually the choice to watch a 2 minute commercial at the beginning or 2-3 30 second commercials during your show. Now it's 2-3 30 second commercials, 3-4 times per episode. When a company finds a way to make money, they will take it to the nth degree.
You can't believe the number of people out there that think it should be free. It's entertaining to read, to be sure.
I get you want to pay for you want, we would like to offer it in that fashion. We aren't allowed to. I also think it will be interesting for those that say they want to just pay for what they want if they change their tune when ESPN is $30 for one channel and by the time they are done stacking up their 10 to 15 channels they want, they are $70 to $80 in. This is why it's been fun watching the Canadians give this a go and then the customers now saying "well wait, we didn't know this was going to be the outcome." If people want that system, by all means send letters to your congressmen, get the legislation passed but also understand the ramifications....there will be plenty. Big money for schools like Marquette from sports rights....bye bye. One of many examples. I think most people in this country have not a clue on the ramifications...I'm being generous...I know they don't.
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Again... not talking about Laura, I'm talking about her employer. But there's no way that Needham takes that report public without the mouse's permission. If Ms. Martin wrote it with an opposite message, I guarantee it never sees the light of day.
That's got to be the most frustrating thing about being an independent analyst for a company who has a relationship with your subject... a good portion of your work ends up in the custody of "top men."
I don't know why you keep saying this...you are wrong. They ARE NOT A CONSULTANT OF DISNEY. They are an analyst....analysts come out with reports all the time on companies and are not consultants of those companies. Do they see a report in advance, sure that's possible but that doesn't mean the analyst can't deliver incredibly bad news about a company. At the end of the day, they have a fiduciary responsibility to their clients...their customers, not to Disney or AOL or Microsoft. They are there to advise on certain companies that their customers are either advised to buy or not to buy based on their research. I don't understand why you keep saying this about Needham and Disney.
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Again... not talking about Laura, I'm talking about her employer. But there's no way that Needham takes that report public without the mouse's permission. If Ms. Martin wrote it with an opposite message, I guarantee it never sees the light of day.
That's got to be the most frustrating thing about being an independent analyst for a company who has a relationship with your subject... a good portion of your work ends up in the custody of "top men."
Actually, Benny, Needham cannot under SEC regs act in the advisory role as you are suggesting to Disney (unless of course its principals wish to hone their tennis game at a Club Fed...) Needham focuses on incipient thru mezzanine level placements and can advise those investees on operational matters. But Laura's role is altogether different. She is an analyst who monitors the market place within her vertical and provides insight on past and future performance strictly for the purpose of investment.
When I was in Corp Strat at TMO my team worked with the Street analysts and industry observers like Laura to help them understand what was happening in Bellevue & Bonn as well as how we saw things in NJ, Atl, and KC. There is no way we or anyone else (VZ, ATT, Spint, et al) would speak with her if she was consulting the enemy.
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Thought you guys might be interested in this....latest industry data. Things are changing, but at a very slow rate. Report issued this week:
Average American weekly video consumption
34 hours and seven minutes of traditional television
two hours and 40 minutes of time-shifted viewing (DVR, VOD)
40 minutes of Internet video (Hulu, Netflix, Amazon, YouTube)
10 minutes of smartphone viewing.
Cable subscribership was at 57.4% in 2011 down to 55.7% in June 2012. By contrast, satellite is going the other way, at least slightly, from 33.9 million in 2011 to 34 million in 2012.
98.6% of Households have access to at least three providers (Satellite, Cable, Telco)
The other interesting data point, online subscription services way up from 26million to 41million, but has not translated enough in viewership to augment the numbers significantly (I'm sure that will change over time).
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Actually, Benny, Needham cannot under SEC regs act in the advisory role as you are suggesting to Disney (unless of course its principals wish to hone their tennis game at a Club Fed...) Needham focuses on incipient thru mezzanine level placements and can advise those investees on operational matters. But Laura's role is altogether different. She is an analyst who monitors the market place within her vertical and provides insight on past and future performance strictly for the purpose of investment.
When I was in Corp Strat at TMO my team worked with the Street analysts and industry observers like Laura to help them understand what was happening in Bellevue & Bonn as well as how we saw things in NJ, Atl, and KC. There is no way we or anyone else (VZ, ATT, Spint, et al) would speak with her if she was consulting the enemy.
Again....thank you.
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Again....thank you.
If you see Laura please tell her Dan from TMO says hi. She'll remember me from the meeting at Andreessen Horowitz.
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What's coming for Netflix and others....very soon. They really don't have a choice if they want to survive long term.
http://www.bloomberg.com/news/2013-07-21/netflix-rule-as-no-1-s-p-performer-but-.html
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Many fun articles today about Netflix as well as HBO.
Here was one interesting tidbit
"In 2012, HBO raked in $1.5 billion in profit on more than $4.5 billion in revenue, according to SNL Kagan. Netflix posted net profit of $17 million with $3.6 billion in revenue (of which $1.1 billion was from the mail-by-DVD business)."
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Many fun articles today about Netflix as well as HBO.
Here was one interesting tidbit
"In 2012, HBO raked in $1.5 billion in profit on more than $4.5 billion in revenue, according to SNL Kagan. Netflix posted net profit of $17 million with $3.6 billion in revenue (of which $1.1 billion was from the mail-by-DVD business)."
Sounds like there's a lot of producer surplus out there waiting to be gobbled up by smart competitors to HBO.
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Sounds like there's a lot of producer surplus out there waiting to be gobbled up by smart competitors to HBO.
If "smart" is making only $17M on $3.6 billion in revenue, I'd hate to see what dumb is.
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Nevermind, why bother.
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Nevermind, why bother.
Smart competitors aren't going to stay in business long if they run their business like that. That was my only point.
It's going to be a fun next 10 to 15 years. Technology isn't the issue, as I've said many times before. It comes down to what the studios are willing to sell their product for...they hold the cards.
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Not a shady set of companies at all....
http://www.techdirt.com/articles/20130722/17503523891/telco-astroturfing-tries-to-bring-down-reviews-susan-crawfords-book.shtml
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Uh, ok. This company? http://www.businessweek.com/articles/2013-01-02/dish-network-the-meanest-company-in-america
http://www.theverge.com/2013/1/4/3835670/what-makes-dish-network-the-worst-company-to-work-for-in-america
They're having trouble just keeping people there.
Back to back winners. Your 2013 winner http://blogs.denverpost.com/techknowbytes/2013/07/30/dish-network-rated-as-worst-company-to-work-for-in-america-for-second-straight-year/10869/
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And Time Warner drops CBS...wow. I thought it was annoying when DirecTV dropped Viacom for a hot minute, but this is crazy...
http://www.usatoday.com/story/money/business/2013/08/02/cbs-time-warner-cable-negotiation/2613667/
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And Time Warner drops CBS...wow. I thought it was annoying when DirecTV dropped Viacom for a hot minute, but this is crazy...
http://www.usatoday.com/story/money/business/2013/08/02/cbs-time-warner-cable-negotiation/2613667/
CBS wants a ton of money for something you can free with an off air antenna. When the networks lost their arse a few years ago in the advertising world they decided they would now charge cable, satellite, telco from a few cents per sub to dollars per sub. At the end of the day, folks don't go and blame CBS, or ESPN, or HBO, or whatever...they blame the guy sending them the bill (TWC, FIOS, UVERSE, DISH, CHARTER, etc). So that's why they are pushing back so hard.
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CBS wants a ton of money for something you can free with an off air antenna. When the networks lost their arse a few years ago in the advertising world they decided they would now charge cable, satellite, telco from a few cents per sub to dollars per sub. At the end of the day, folks don't go and blame CBS, or ESPN, or HBO, or whatever...they blame the guy sending them the bill (TWC, FIOS, UVERSE, DISH, CHARTER, etc). So that's why they are pushing back so hard.
To CBS I'd say this, what makes you so necessary?
I've had DTV since early 1997 without interruption and never felt like pulling the plug on them. Now I'm starting to think I might if programming choices aren't made more flexible. With cheap high speed WiFi my house is likely to have Netflix going over programming from DTV. My wife and I watch maybe 10 channels out of the 150 DTV forces us to buy. CBS, NBC, ABC, PBS, Fox aren't among those 10 except for 1 show, "Blue Bloods". We can do without all of those legacy networks for entertainment and we stopped using them for news over 10 years ago.
Did anyone at CBS notice that Amazon bought out the Washington Post's newspaper business? That sets them up nicely to have a news channel when they roll out their TV router in the near future. Then there is Netflix winning Emmy's for original programming.
Does CBS get where this is going?
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To CBS I'd say this, what makes you so necessary?
I've had DTV since early 1997 without interruption and never felt like pulling the plug on them. Now I'm starting to think I might if programming choices aren't made more flexible. With cheap high speed WiFi my house is likely to have Netflix going over programming from DTV. My wife and I watch maybe 10 channels out of the 150 DTV forces us to buy. CBS, NBC, ABC, PBS, Fox aren't among those 10 except for 1 show, "Blue Bloods". We can do without all of those legacy networks for entertainment and we stopped using them for news over 10 years ago.
Did anyone at CBS notice that Amazon bought out the Washington Post's newspaper business? That sets them up nicely to have a news channel when they roll out their TV router in the near future. Then there is Netflix winning Emmy's for original programming.
Does CBS get where this is going?
Actually Bezos bought the Post, but Amazon had nothing to do with it.
Netflix was nominated for 14 Emmys. To put that in perspective, HBO had 108. Netflix refuses to release how many people are actually watching their original series. We have three former Netflix employees on staff and they said the numbers are quite low.
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Actually Bezos bought the Post, but Amazon had nothing to do with it.
Netflix was nominated for 14 Emmys. To put that in perspective, HBO had 108. Netflix refuses to release how many people are actually watching their original series. We have three former Netflix employees on staff and they said the numbers are quite low.
Chicos, I'll agree with you on the emmy front. Heck, I've even been nominated for an Emmy so I'll take those nominations with a grain of salt.
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Actually Bezos bought the Post, but Amazon had nothing to do with it.
Netflix was nominated for 14 Emmys. To put that in perspective, HBO had 108. Netflix refuses to release how many people are actually watching their original series. We have three former Netflix employees on staff and they said the numbers are quite low.
I don't see the perspective on that; if HBO didn't have more - a lot more - they would be out of business. HBO has a ton of quality programming and a reputation going back decades to draw talented people in. Netflix is a new player in that area. For Netflix to earn a nomination for it's first original show is a huge feather in its cap. I'm sure HBO and Showtime cannot claim the same honor.
And compared to network TV, HBO's audiences are miniscule. It's all about perspective. It's like saying that FS1 will be a failure because it's numbers will pale in comparison to ESPN next year.
It was also funny in the article belittling Netflix' subscription numbers that it saw the almost 2 million free subscribers as a negative. How can that be? EVERY new Netflix subscriber is getting it free for the first month. This is where the paid subs will come from.
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Actually Bezos bought the Post, but Amazon had nothing to do with it.
Netflix was nominated for 14 Emmys. To put that in perspective, HBO had 108. Netflix refuses to release how many people are actually watching their original series. We have three former Netflix employees on staff and they said the numbers are quite low.
Yes you are correct, I should not have conflated Bezo's ownership of Wapo with his leadership of Amazon. But for my purposes its a distinction without a difference should Amazon go ahead and launch its own streaming network. For Bezo he has content to feed into Amazon TV without having to dilute Amazon's balance sheet with Wapo's much weaker financials. While Wapo isn't Amazon's news gathering division, it will be Bezo's news gathering division dedicated to supplying Amazon with all the content a news station could need.
On the one hand you have DirecTV trying to rein in its payments to content providers who are demanding too much already, then you have Netflix at $7.95 offering original programming and seemingly endless on demand movies driving costs lower. Now Amazon is about to enter the fray and already controlling their own news content so you can be sure they will do the same for original entertainment programming with the goal of costing much less than Comcast, DTV and the others. The non-sports fans of the world should be happy as they will get their ala carte programming, probably without the legacy networks, but maybe that is ok. For companies like DTV, which I've had for 16 years and had excellent customer service, they have to deal with these new lower cost WiFi distributors while dealing with the ESPN's and CBS's that I think are drastically overvaluing their product. Tough problem you have to solve. Could a purchase of Netflix by DTV or Comcast be far off?
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Chicos, I'll agree with you on the emmy front. Heck, I've even been nominated for an Emmy so I'll take those nominations with a grain of salt.
You, too? What for?
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I don't see the perspective on that; if HBO didn't have more - a lot more - they would be out of business. HBO has a ton of quality programming and a reputation going back decades to draw talented people in. Netflix is a new player in that area. For Netflix to earn a nomination for it's first original show is a huge feather in its cap. I'm sure HBO and Showtime cannot claim the same honor.
And compared to network TV, HBO's audiences are miniscule. It's all about perspective. It's like saying that FS1 will be a failure because it's numbers will pale in comparison to ESPN next year.
It was also funny in the article belittling Netflix' subscription numbers that it saw the almost 2 million free subscribers as a negative. How can that be? EVERY new Netflix subscriber is getting it free for the first month. This is where the paid subs will come from.
They are belittling the numbers because financially they are in for some big issues. They have $5 billion in expenses they have to dole out in the next 3 years, over $3billion of that in the next 18 months. The street expected a lot more than 2 million free subscribers, that's the rub....that's why it was considered a negative. It will be interesting to see what happens with them and the space. There isn't a month that goes by that just about everyone on our team isn't approached by Netflix, Amazon, etc to go work for them....no one has left yet. They have some fundamentals that are problematic on the Netflix side. On the Amazon side, you have to live in Seattle.....I could no longer say citizen or brown bag.... :o
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Yes you are correct, I should not have conflated Bezo's ownership of Wapo with his leadership of Amazon. But for my purposes its a distinction without a difference should Amazon go ahead and launch its own streaming network. For Bezo he has content to feed into Amazon TV without having to dilute Amazon's balance sheet with Wapo's much weaker financials. While Wapo isn't Amazon's news gathering division, it will be Bezo's news gathering division dedicated to supplying Amazon with all the content a news station could need.
On the one hand you have DirecTV trying to rein in its payments to content providers who are demanding too much already, then you have Netflix at $7.95 offering original programming and seemingly endless on demand movies driving costs lower. Now Amazon is about to enter the fray and already controlling their own news content so you can be sure they will do the same for original entertainment programming with the goal of costing much less than Comcast, DTV and the others. The non-sports fans of the world should be happy as they will get their ala carte programming, probably without the legacy networks, but maybe that is ok. For companies like DTV, which I've had for 16 years and had excellent customer service, they have to deal with these new lower cost WiFi distributors while dealing with the ESPN's and CBS's that I think are drastically overvaluing their product. Tough problem you have to solve. Could a purchase of Netflix by DTV or Comcast be far off?
I don't agree with you on the costs going lower. As mentioned in a previous post, their liabilities are coming in spades in the next 18 months. The media companies don't want to trade dollars for dimes. So if people pull out of pay tv, the media companies will exact their pound of flesh from the OTT players (Netflix, Hulu, Amazon). One way or the other, they are going to get their dollars. Something has to give for them to pay out this $5.7billion, especially for a company that can barely turn a profit right now. Big price increases coming for their subscribers most likely.
http://www.zerohedge.com/news/2013-04-22/does-netflix-34-billion-balance-sheet-liability-make-it-house-cards
http://www.tradingfloor.com/posts/the-importance-of-netflixs-growth-and-its-liability-time-bomb-263346944
(http://www.tradingfloor.com/images/blog/medium/5622f01a-ee89-4bae-9446-8857994bf7de.png)
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They are belittling the numbers because financially they are in for some big issues. They have $5 billion in expenses they have to dole out in the next 3 years, over $3billion of that in the next 18 months. The street expected a lot more than 2 million free subscribers, that's the rub....that's why it was considered a negative. It will be interesting to see what happens with them and the space. There isn't a month that goes by that just about everyone on our team isn't approached by Netflix, Amazon, etc to go work for them....no one has left yet. They have some fundamentals that are problematic on the Netflix side. On the Amazon side, you have to live in Seattle.....I could no longer say citizen or brown bag.... :o
Chico - Netflix stock is up 500% in the last year. Should we buy some puts? Is it all a "House of Cards"? :)
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http://images.burrellesluce.com/image/3570XN/3570XN_26262
http://images.burrellesluce.com/image/3570XN/3570XN_26263
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They are belittling the numbers because financially they are in for some big issues. They have $5 billion in expenses they have to dole out in the next 3 years, over $3billion of that in the next 18 months. The street expected a lot more than 2 million free subscribers, that's the rub....that's why it was considered a negative. It will be interesting to see what happens with them and the space. There isn't a month that goes by that just about everyone on our team isn't approached by Netflix, Amazon, etc to go work for them....no one has left yet. They have some fundamentals that are problematic on the Netflix side. On the Amazon side, you have to live in Seattle.....I could no longer say citizen or brown bag.... :o
I recognize your expertise here and admit you know a lot more about these things.
But it seems like what is being said about Netflix is the same that was being said about YouTube just a few short years ago. Now, YouTube is raking in a ton of money for Google.
I don't doubt that Netflix will have a few more growing pains - but you have to remember that this is there first year for original programming and they have put 3 very good products out there. I don't know how much the public at large is aware of this. I know in my case, before I decided to subscribe, I thought it was a place for movies. I think that is probably still the general perception among non-members.
There is also the sea change over the last half dozen years where creative people are clamoring to get into television now because of the short-season series (10 - 13 episodes). Again I think that is something that will continue. Movies are no longer the only outlet for creative, enterprising minds.
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I don't agree with you on the costs going lower. As mentioned in a previous post, their liabilities are coming in spades in the next 18 months. The media companies don't want to trade dollars for dimes. So if people pull out of pay tv, the media companies will exact their pound of flesh from the OTT players (Netflix, Hulu, Amazon). One way or the other, they are going to get their dollars. Something has to give for them to pay out this $5.7billion, especially for a company that can barely turn a profit right now. Big price increases coming for their subscribers most likely.
http://www.zerohedge.com/news/2013-04-22/does-netflix-34-billion-balance-sheet-liability-make-it-house-cards
http://www.tradingfloor.com/posts/the-importance-of-netflixs-growth-and-its-liability-time-bomb-263346944
(http://www.tradingfloor.com/images/blog/medium/5622f01a-ee89-4bae-9446-8857994bf7de.png)
Given that balance sheet I wouldn't buy their stock but they do put out an excellent product. I think they have proven there is a market for ala carte programming where the consumer uses on demand to get their entertainment. Maybe Amazon or Apple will do better. All I know is my 18 year old daughter is addicted to Netflix. Her crowd of friends are too. I'm starting to see the cost savings of using Ruku or Apple TV since I've learned about Netflix. Seems to me I can't be alone. I pay about $1300/year to you guys, you're welcome, but Netflix at $7.95/mo gets my attention and thinking that something has to change. Again, I can't be alone.
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There is going to be some major consolidation coming up. All the tea leaves point to it. Whether it is Directv buying Dish (or the other way around), or AT&T buying a satellite company, Charter and TimeWarner merging or perhaps Cablevision is bought out, it's likely to happen. The media companies have too much leverage right now and the only way to combat them is with scale.
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Given that balance sheet I wouldn't buy their stock but they do put out an excellent product. I think they have proven there is a market for ala carte programming where the consumer uses on demand to get their entertainment. Maybe Amazon or Apple will do better. All I know is my 18 year old daughter is addicted to Netflix. Her crowd of friends are too. I'm starting to see the cost savings of using Ruku or Apple TV since I've learned about Netflix. Seems to me I can't be alone. I pay about $1300/year to you guys, you're welcome, but Netflix at $7.95/mo gets my attention and thinking that something has to change. Again, I can't be alone.
Yes, but remember they aren't selling a la carte programming, their selling SVOD, or subscription VOD. Basically one price gets you access to a bunch of stuff, most of it really old, but some peppered in there with newer stuff. Don't get me wrong, I think they have a nice product, nice interface, but I'd be worried about what they plan on doing. I say that as a shareholder that got in pretty low (I tend to buy companies that I'm most familiar with, many of which I either worked for in the past or their competitors) and I wonder where they are going. Very cost conscious customer base that revolted over a few dollar increase a few years ago. They are going to have to go that way in the near future to address these liabilities, IMO.
In terms of a la carte, no one has that here that isn't costing a ton of money. If you want a recent movie, you have to pay iTunes or XBOX, or PS3 or DIRECTV $6 to $10 to view it and you don't even own it. You can own it at usually $15 or so. It's only until it becomes quite dated that it can slip into an affordable SVOD type offering.
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Chico - Netflix stock is up 500% in the last year. Should we buy some puts? Is it all a "House of Cards"? :)
I know, I got in at a very good number. Of course I can think of a lot of companies that are miles ahead of them in quality, etc, etc that are taking a short term hit...Apple comes to mind....over $700 nearly a year ago, now in the $460's. I own both stocks. NFLX was at it's peak a few weeks ago until their most recent earnings report when it took a nice slide. A lot of people are in love with them, certain stocks have a way of producing Greenspan's Irrational Exuberance from time to time. Their balance sheet concerns me as a stockholder.
I'm not saying it isn't a good company without a compelling product, of course it is. I worry about what's coming around the corner because the piper is ready to be paid and how are they going to pay it? Maybe they find a way, but as a shareholder I'd like to see them make a bit more than $17M on $1B in revenues and not have almost $6B in liabilities staring them down.
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I recognize your expertise here and admit you know a lot more about these things.
But it seems like what is being said about Netflix is the same that was being said about YouTube just a few short years ago. Now, YouTube is raking in a ton of money for Google.
I don't doubt that Netflix will have a few more growing pains - but you have to remember that this is there first year for original programming and they have put 3 very good products out there. I don't know how much the public at large is aware of this. I know in my case, before I decided to subscribe, I thought it was a place for movies. I think that is probably still the general perception among non-members.
There is also the sea change over the last half dozen years where creative people are clamoring to get into television now because of the short-season series (10 - 13 episodes). Again I think that is something that will continue. Movies are no longer the only outlet for creative, enterprising minds.
Interesting post. My comments would be that YouTube is making money off an ad driven model. I don't think Netflix is going to go down this path, but if they do they could monetize further, though they would alienate folks as well. On the original series of Netflix, they are good. That isn't my concern, it's on the content they are buying elsewhere. Some smart guys over there, hopefully they have a plan. It will help my nest egg.
Agree on the ability for the amateur to break in through other means. Whether they can monetize it is another story, but the platforms are there and there are eyeballs.
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Interesting post. My comments would be that YouTube is making money off an ad driven model. I don't think Netflix is going to go down this path, but if they do they could monetize further, though they would alienate folks as well. On the original series of Netflix, they are good. That isn't my concern, it's on the content they are buying elsewhere. Some smart guys over there, hopefully they have a plan. It will help my nest egg.
Agree on the ability for the amateur to break in through other means. Whether they can monetize it is another story, but the platforms are there and there are eyeballs.
The next couple years will definitely be interesting on these fronts. You look at the changes in viewing over the last 10 years - actually even earlier if you look at the hurdles ESPN had in their formative years - and it's unbelievable.
I vacation/travel a lot and it used to be that you'd try to find a motel on the road that had HBO. Now I throw the iPad in the bag and can watch Netflix or a ton of content on HBOGo on any motel TV.
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Where else can you gt this kind of quality? ;D
http://bleacherreport.com/articles/1729287-peyton-and-eli-mannings-rap-song-is-the-greatest-thing-to-ever-hit-the-internet?utm_source=facebook.com&utm_medium=referral&utm_campaign=programming-national
;D
http://www.youtube.com/v/jn5zytfm9No
TOUCHDOWN! ADWEEK's Gabriel Beltrone wrote, "At first you'll hate it, but then you won't be able to stop watching." After a couple minutes "of rubbernecking, you'll see Eli burst through a large portrait of Alexander Graham Bell and realize you've been beaten about the head with stupidity to the point that you can't help but laugh" (ADWEEK.com, 8/6). SI.com's Chris Burke wrote this spot "raised the bar ... putting 'Football on Your Phone' immediately into the pantheon of greatest commercials featuring athletes" (SI.com, 8/6). NFL.com's Dan Hanzus wrote, "Say this for Peyton and Eli Manning: They aren't afraid to be ridiculous for the sake of entertainment." Eli is "absolutely rocking a curly wig that summons memories of 1999-era Justin Timberlake." Peyton is "dressed like an aging European nightclub patron." They are both "woeful in their lyrical delivery." Hanzus: "Our favorite part is probably when Eli disrespects the memory of Alexander Graham Bell. But really, this is a tour de force all around" (NFL.com, 8/6).
TWITTER REAX: SI.com's Jimmy Traina wrote, "Don't want to oversell this, but this Peyton & Eli Manning rap/R&B video is the greatest thing you will see today." Blogger Steve DelVecchio: "Manning brothers have officially won the offseason with this amazing rap video." The Washington Post's Cindy Boren wrote, "The Mannings put football on your phone and football in your pants. It's for DirecTV and it's ... mesmerizing." Newsday Sports' official feed stated, "Peyton Manning already a commercial genius, but Eli's Will Ferrell hair in new RAP VIDEO is pure brilliance."
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There is going to be some major consolidation coming up. All the tea leaves point to it. Whether it is Directv buying Dish (or the other way around), or AT&T buying a satellite company, Charter and TimeWarner merging or perhaps Cablevision is bought out, it's likely to happen. The media companies have too much leverage right now and the only way to combat them is with scale.
Oh goody. Nothing better for consumers than to have huge companies occupying large swaths of a single market. That always works out well for the little guy!
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Oh goody. Nothing better for consumers than to have huge companies occupying large swaths of a single market. That always works out well for the little guy!
The hope is that it will be a counterweight against the Disney, CBS, NBC, Viacom, because they have all the leverage. My company is spending more than $10 billion this year in programming costs. It's insane.
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Chase Carey, #2 guy at NewsCorp (FOX) and my former CEO had this to say last week.
"A la carte is fantasy"
http://www.forbes.com/sites/jeffbercovici/2013/08/08/21st-century-foxs-chase-carey-a-la-carte-is-a-fantasy/
As I've been saying here for a long time, the content providers are the ones that control this, not the distributors. They aren't going to kill their golden goose, not anytime soon anyway. Many years down the road, maybe.
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This would be an interesting blow to cable/satellite ..
http://allthingsd.com/20130820/is-google-ready-to-buy-its-way-into-tv-with-an-nfl-deal/
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This would be an interesting blow to cable/satellite ..
http://allthingsd.com/20130820/is-google-ready-to-buy-its-way-into-tv-with-an-nfl-deal/
Yup, it would mean a package we lose money on would go away (or shared is most likely) along with a huge cost and 15% of customers could get it elsewhere, like on YouTube instead of their 60" screen. Customers will have to make that choice. The ISPs will love it when people's data caps explode and they rake in the cash. Old news, surprised it took this long to get out.
Right now, Dish and Directv making about 10% profit annually, not exactly crazy money. Not anywhere close to Apple or Google on net profit margins.
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Yup, it would mean a package we lose money on would go away (or shared is most likely) along with a huge cost and 15% of customers could get it elsewhere, like on YouTube instead of their 60" screen. Customers will have to make that choice. The ISPs will love it when people's data caps explode and they rake in the cash. Old news, surprised it took this long to get out.
Right now, Dish and Directv making about 10% profit annually, not exactly crazy money. Not anywhere close to Apple or Google on net profit margins.
I get 1080p with my Youtube app via my Chromecast right now.
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I get 1080p with my Youtube app via my Chromecast right now.
Don't confuse 1080p with bit rate or necessary quality. Bit rate is the key. Lots of stuff in 1080p that is subpar to 1080i or even 720p if the bit rate isn't there. 1080p merely represents the lines of resolution at 1920 X 1080, but if the throughput isn't there in the bit rate (i.e. bit rate starved) then you suffer quality, especially on larger devices.
As an example, an uncompressed 1080p stream maxes out (I believe, it's been awhile) at 19mpbs to 20mbps. Youtube's maxed out 1080p is 8mbps to 10mbps....that's maxed out. Satellite is usually pumping it through at 13mbps and can go higher if need be, just a matter of capacity constraints.
Higher the bit rate, higher the file size \ streaming capacity. That's where the data caps come into play
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chicos is correct - not all 1080P is created equal as Netflix customers etc. should have noticed by now, it is all about the bit rate
true 1080P ala blu-ray disks can have 54Mbps (and could even be expanded in the future to 288Mbps)
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chicos is correct - not all 1080P is created equal as Netflix customers etc. should have noticed by now, it is all about the bit rate
true 1080P ala blu-ray disks can have 54Mbps (and could even be expanded in the future to 288Mbps)
Yup. A common marketing spin by television services (I include DTV, Netflix, etc in this) is to say they are providing 1080p broadcasts, same as BluRay. Honestly, I shook my head when we did it. It's technically true, but it's no where close to the story. Most people don't understand bit rate or resolution or codecs, etc. So when you go out and say things like 1080p format, just like BluRay and then a customer watches the show and says "this isn't as good as BluRay", you're asking for trouble. To your point, there can be a huge difference if the content is bit starved, which is all a function of capacity. Cable, satellite, broadband (Hulu, Netflix, etc) all have to compress streams, some much more than others. It can make a big difference, especially on the device one is looking on.
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Basically what FOX CEO said last week...fantasy.
A LA CARTE NOT PRACTICAL: Skipper addressed several other topics during a 90-minute meeting with the assembled media. He said an a la carte pricing system for cable channels "is not a good solution for whatever the issue is here." Skipper: "It is not particularly beneficial to anybody. Right now there is an issue of price pressure. But the $73 for 200-plus channels kind of works for almost everybody, other than some people for whom it’s a financial burden. It subsidizes a big system of content. There is better content now to consume on video than there’s ever been. There’s a discussion about the golden age of television -- this is the only golden age of television. ... This ecosystem works to provide lots and lots of choice for a very insignificant cost on any sort of metric. If you break it up and charge it on a per-program basis or per-network basis -- which by the way has very little chance of happening, despite there being a couple senators floating this around -- it just won’t work.” Skipper said 83% of households that get ESPN watch the network. He added of a la carte ever becoming a reality: “Because of the rights we hold, we’d be fine. ... But channels 65 through 250 are going to go out business, or start producing inexpensive content, which will be lousy. There won’t be this beautiful content that you have this opportunity to pick from, because they won’t be able to afford it.” Skipper said, “Specialty channels, serving specialty interests, will not survive in an a la carte world. However, we’re talking hypotheticals. That’s just not getting ready to happen.”
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CBS is the winner.
Customers won't complain about CBS, they complain about who they have to pay the bill to. Basically, Time Warner bills just went up a whole bunch to cover this, but CBS won't care. Programmers have most, if not all, of the leverage in this stuff.
http://articles.chicagotribune.com/2013-09-02/business/sns-rt-us-cbs-timewarner-20130902_1_cbs-corp-cable-operator-cbs-content
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I wonder if you chalk that up to .. the value of football.
CBB, you might not know .. TWC in Milwaukee is fighting the local NBC affiliate .. been off the air for 30+ days now. Every few days, one side takes out a full page ad in the paper, saying how evil the other side is.
Meanwhile, a month has gone by and .. I think most people are thinking .. Channel 4? Never heard of it. Sure, there were a couple of Packer pre-season games that people had to scramble to see, but that's over now. The value of WTMJ is evaporating each day. I would foresee them completely losing this dispute since people have just .. moved on. In a month or two, they'll be begging TWC to accept any offer.
But CBS .. has the NFL. No way TWC could drop them forever.
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I wonder if you chalk that up to .. the value of football.
CBB, you might not know .. TWC in Milwaukee is fighting the local NBC affiliate .. been off the air for 30+ days now. Every few days, one side takes out a full page ad in the paper, saying how evil the other side is.
Meanwhile, a month has gone by and .. I think most people are thinking .. Channel 4? Never heard of it. Sure, there were a couple of Packer pre-season games that people had to scramble to see, but that's over now. The value of WTMJ is evaporating each day. I would foresee them completely losing this dispute since people have just .. moved on. In a month or two, they'll be begging TWC to accept any offer.
But CBS .. has the NFL. No way TWC could drop them forever.
I don't disagree with you in general, but NBC has the NFL too...granted it is just one game per week.
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I don't disagree with you in general, but NBC has the NFL too...granted it is just one game per week.
Might be interesting to see how this would turn out after the football season.
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I don't disagree with you in general, but NBC has the NFL too...granted it is just one game per week.
but now WTMJ has until October 27th before they really have to worry about that (GB vs. MN on NBC)
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but now WTMJ has until October 27th before they really have to worry about that (GB vs. MN on NBC)
I booked Pat McCurdy for our festival right during that game. It'd be helpful if people were unable to watch...!
(Yes, McCurdy is still performing. He is exactly the same guy you saw at the Brooks Union 25 years ago.)
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For 1 Packer game a year, it's not worth it to me. I never watch the local programming on WTMJ.
They wouldn't know what news is if someone slapped them in the face with it. If I want to watch that crap (which I don't), I'd watch TMZ or read People magazine. Probably more news value there than at WTMJ.
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but now WTMJ has until October 27th before they really have to worry about that (GB vs. MN on NBC)
Has TWC contemplated giving away vouchers for TV antennas recently? You can get an antenna off the shelf at Wally World for less than $15... TWC could save face and money if they just bought antennas for people.
That said, I'm in northern Illinois - 51 miles from the WTMJ-DT antenna, to be exact - and WTMJ comes in crystal clear on my TV antenna I fashioned from two coat hangers and a 2x4. If I can do that, a simple set-top antenna in metro Milwaukee should be more than sufficient.
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I wonder if you chalk that up to .. the value of football.
CBB, you might not know .. TWC in Milwaukee is fighting the local NBC affiliate .. been off the air for 30+ days now. Every few days, one side takes out a full page ad in the paper, saying how evil the other side is.
Meanwhile, a month has gone by and .. I think most people are thinking .. Channel 4? Never heard of it. Sure, there were a couple of Packer pre-season games that people had to scramble to see, but that's over now. The value of WTMJ is evaporating each day. I would foresee them completely losing this dispute since people have just .. moved on. In a month or two, they'll be begging TWC to accept any offer.
But CBS .. has the NFL. No way TWC could drop them forever.
Partially true, bur realize this is a dead time for broadcast television. In a couple weeks the new seasons of shows will begin and I assure you people will be more upset when their favorite shows premiers begin. TWC has a cushion of a few more weeks before people really start getting upset.
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Has TWC contemplated giving away vouchers for TV antennas recently?
Yes. They have free antennas at their TWC stores .. and if you go to Best Buy they will give you a voucher for $xx off any antenna you buy there.
Partially true, bur realize this is a dead time for broadcast television. In a couple weeks the new seasons of shows will begin and I assure you people will be more upset when their favorite shows premiers begin. TWC has a cushion of a few more weeks before people really start getting upset.
You're right .. but .. it's all crap! Viewers aren't seeing the fall season promos, they won't even know what they are missing.
My guess is the umbrage TWC is feeling from people complaining is dying down, and will continue to slope to zero. WTMJ is in real trouble. -- This happened to the #1 station in a city in Texas .. they had a 5 month battle with the big cable company .. when they got back on cable, they were dead last.
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WTMJ gave out antennas at the WI State Fair
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The plot thickens...
http://qz.com/144377/time-warner-doesnt-want-you-to-know-you-can-get-hbo-without-cable/#!
http://variety.com/2013/biz/news/comcast-becomes-first-pay-tv-distributor-to-offer-hbo-without-basic-cable-1200761863/
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The plot thickens...
http://qz.com/144377/time-warner-doesnt-want-you-to-know-you-can-get-hbo-without-cable/#!
http://variety.com/2013/biz/news/comcast-becomes-first-pay-tv-distributor-to-offer-hbo-without-basic-cable-1200761863/
Been going on for over a year
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Been going on for over a year
Ok... But you don't think it represents any sort of change in philosophy or anything?
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Ok... But you don't think it represents any sort of change in philosophy or anything?
Fair question. I think the fundamentals for them here in the States are still the same, at least for now. Some day, yes, but right now they risk massive dollars if this becomes the norm. What they are doing is a test. Their biggest issues right now are they don't have the infrastructure to do this at scale and they don't want to give up the billions of dollars from the television providers either. They also don't want to have to launch massive number of call centers, etc.
They're giving up a lot of revenue in this test they are doing. Typically HBO gets over half of that fee the distributor is charging, so if Dish is charging $18 then HBO is getting north of $9. In this test, they are getting a fraction of that amount. In the long run, they are not going to want to trade dollars for dimes, so they're going to have to figure out what is most important to them. Remember, they don't sell advertising and ratings don't mean a whole lot to them. This is the big difference between them and the OTA networks that will sell their stuff online all day and all night because they don't give a rip if you watch it online or via a television distributor, they'll get their piece of the advertising either way....of course they also want the retrans fees as well from the distributors, and those days might be coming to an end with Aereo, etc. Lots of fun stuff starting.
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http://www.businessinsider.com/cord-cutters-and-the-death-of-tv-2013-11
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http://www.businessinsider.com/cord-cutters-and-the-death-of-tv-2013-11
DIRECTV, AT&T, FIOS, DISH all growing right now
(http://static2.businessinsider.com/image/528a33ec69beddfa0568bc3e-921-580/screen%20shot%202013-11-18%20at%2010.35.27%20am.png)
Cable....losing and have been for over a decade....nothing new.
Follow the money Jesu, follow the money. It all comes down to the content companies. If they don't get their billions from the distributors, they'll get it from the OTT guys, either way they are getting their money. This idea that by cord cutting is going to get people cheaper content isn't going to happen. You're just going to be paying someone else, but you will be paying.
You are going to see major consolidation in my opinion. Charter will merge with TWC IMO. Wouldn't be surprised to see the satellites merge, or maybe one of the Telco's buy one of the satellite companies. You'll be left with about 4 majors when all is said and done and they will have immense leverage over content because the OTT guys will not be able to go out and cut other deals without the content guys cutting their own throats.
All comes down to the $$$
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You are going to see major consolidation in my opinion. Charter will merge with TWC IMO. Wouldn't be surprised to see the satellites merge, or maybe one of the Telco's buy one of the satellite companies. You'll be left with about 4 majors when all is said and done and they will have immense leverage over content because the OTT guys will not be able to go out and cut other deals without the content guys cutting their own throats.
All comes down to the $$$
Awesome. Can't wait. I'm sure that'll be a positive for consumers
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Awesome. Can't wait. I'm sure that'll be a positive for consumers
Well, consumers want NFL, want FS1, want their Marquette games, want their Game of Thrones want all this stuff. It costs money. The guys that create it or buy the rights are charging a crapload of money for it. Those that distribute it have to pass the costs on.
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I'm sure this will work out well for another 10-20 years, but after the wealthiest generation in history dies off and the Gen-X'ers and Millenials who can't even afford free health care (sic) are supposed to replace them, the $$$ for triple digit tv packages featuring trash like 24/7 Alaska channels will disappear.
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Well, consumers want NFL, want FS1, want their Marquette games, want their Game of Thrones want all this stuff. It costs money. The guys that create it or buy the rights are charging a crapload of money for it. Those that distribute it have to pass the costs on.
You're right!!
But the benefit for consumers is that they will probably be able to choose what the want to pay for rather than being force-fed dozens of useless channels.
It was only a few short years ago where it was unthinkable to be able to buy only the album tracks that you wanted. I buy a lot of music, but only what I want to buy. I'm no longer required to buy 'filler' tracks to get a couple good songs off of an album. While there are many artists that can fill a CD with quality music, they are many more than can't.
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I'm sure this will work out well for another 10-20 years, but after the wealthiest generation in history dies off and the Gen-X'ers and Millenials who can't even afford free health care (sic) are supposed to replace them, the $$$ for triple digit tv packages featuring trash like 24/7 Alaska channels will disappear.
You may well be right. Of course, the questions will also be asked if triple digit mobile phone bills will still be ok, triple digit a month Starbucks habits, etc, etc.
Lots of choices out there on how people spend their money.
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You're right!!
But the benefit for consumers is that they will probably be able to choose what the want to pay for rather than being force-fed dozens of useless channels.
It was only a few short years ago where it was unthinkable to be able to buy only the album tracks that you wanted. I buy a lot of music, but only what I want to buy. I'm no longer required to buy 'filler' tracks to get a couple good songs off of an album. While there are many artists that can fill a CD with quality music, they are many more than can't.
Oy vei........you guys still make the comparison of producing a music album to television \ sports \ movie. Honestly, I don't know why you guys keep going into that trap. Apples to monkeys comparison.
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You may well be right. Of course, the questions will also be asked if triple digit mobile phone bills will still be ok, triple digit a month Starbucks habits, etc, etc.
Lots of choices out there on how people spend their money.
Chicos, you make a good point here. But the problem for cable/satellite television is that if gen xers or millenials are forced to decide between TV, starbucks or their phone, the first thing to go is going to be TV.
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Chicos, you make a good point here. But the problem for cable/satellite television is that if gen xers or millenials are forced to decide between TV, starbucks or their phone, the first thing to go is going to be TV.
Believe me, we know. Millenials is a big discussion point. The question is what happens to millenials, do they get to a point where they grow up or do they keep going down that path. That's an interesting question and one that many are dealing with, not just tv but those companies that make money on gaming, the internet, etc, etc.
I did a project with L.A. college and post grad students about a month ago. We interviewed random students at USC, college of Fashion and Design, etc...man on the street kind of stuff. Totally targeting millenials and their beliefs on tv. It was very interesting. There was your typical "everything should be FREEEEEEEEEEEEEEEEEEEEEEEEEE" crowd, but there were many that loved their sports or loved certain shows and wanted to watch them (whether it was on TV, a tablet, or whatever). They don't have the money, of course many don't because we've had an entire decade of economic crap, but the desire is there. We'll see how things shake out with the economy over the next decade. I don't see sports rights getting cheaper, certainly making quality tv isn't getting any cheaper (the crap stuff...reality tv is cheap, but not the good stuff). That has to be paid for. Piracy is going to be really interesting, as well, especially with some of the new counter piracy stuff coming down the pipeline.
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Oy vei........you guys still make the comparison of producing a music album to television \ sports \ movie. Honestly, I don't know why you guys keep going into that trap. Apples to monkeys comparison.
I wasn't making a comparison - I was giving an example of how things change in a way that was never expected. When I was young and buying record albums, the concepts of being able to listen to any music you desired on a computer or of purchasing, say, just 3 songs off of a record album were unheard of. I mean, the concept of CDs was not even thought of.
I guess I was saying this will still shake out in ways we may not expect rather than comparing the 2 situations
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Let the fun begin
http://business.time.com/2013/11/25/comcast-time-warner-cable-one-broadband-giant-to-rule-them-all/
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TV business is not the music or print business
http://gigaom.com/2013/09/25/why-the-tv-industry-wont-go-the-way-of-newspapers-and-the-music-business/
http://www.thewrap.com/why-a-la-carte-cable-could-kill-tvs-golden-age/
I believe Mr. Kagan says it well here. It's a 3 party system, not a 2 party system and that is what so many people do not understand.
“Traditionally when customers complain pricing is too high, the company feels the pinch and cuts the price, but cable television isn’t a two-part system,” says Kagan. “Instead, it’s a three-part system. If customers complain to the cable company, they aren’t complaining to the only party that matters. The third party is the networks who always charge more, year after year.”
Part of the reason they do is because the talent also wants more. In fact, a lot of stakeholders have to get paid. Complaining about the cost of accessing content might directly relate to what it costs to produce a show and what actors and actresses in hot shows are demanding for pay raises. A good example is Friends, where all six regular cast members wanted $1 million per episode. That, along with more elaborate shooting locations and larger crews, has likely contributed to this trickle-down effect.
“If the cast of Modern Family goes on strike demanding higher wages, that can trickle down, just like with the high-profile demands of the cast of Friends and for sports programming costs,” says Ireland. “So consumers that clamor for a la carte need to understand that, for better or worse, depending on one’s perspective, there’s a bigger business model that results in the situation we now have and there are many parties on which to place blame if we’re looking for someone to blame.”
Calling it a “broken model” that is essentially unsustainable, Kagan believes the current system protects pay-TV companies and punishes customers unfairly. Regulators back in the day never could’ve imagined this scenario when the system was first set up, but reforming it now will require some trade-offs on all sides.
Are actors or actresses willing to take a pay cut? Will pay-TV operators slowly phase out niche and specialty channels? Will those channels then move to streaming online to connect with their audience, and if so, is that audience willing to pay $5 per month for just one channel?
Read more: http://www.digitaltrends.com/home-theater/a-la-carte-channels-cable-tv-viewing/#ixzz2lgXWQaJG
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I wasn't making a comparison - I was giving an example of how things change in a way that was never expected. When I was young and buying record albums, the concepts of being able to listen to any music you desired on a computer or of purchasing, say, just 3 songs off of a record album were unheard of. I mean, the concept of CDs was not even thought of.
I guess I was saying this will still shake out in ways we may not expect rather than comparing the 2 situations
Fair enough...it's an argument that many others make so I thought you were going there. I just posted a few articles that you might enjoy, they take a balanced view. They explain what would happen to the content, but also to the pricing and why this is so much more complex than people want to make it. For the costs to go down, the athletes, actors, directors, etc that drive the costs of the content have to go the other way. Will that happen? I have serious serious doubts.
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Fair enough...it's an argument that many others make so I thought you were going there. I just posted a few articles that you might enjoy, they take a balanced view. They explain what would happen to the content, but also to the pricing and why this is so much more complex than people want to make it. For the costs to go down, the athletes, actors, directors, etc that drive the costs of the content have to go the other way. Will that happen? I have serious serious doubts.
I guess that is what I was getting at. I think the pricing (if we are able to pick and choose rather than getting a package from a cable company), will be quite a complex issue because of what you stated.
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I just noticed yesterday that my Cablevision/Optimum cable bill carries a separate line item $2.98 monthly fee for Sports Programming Surcharge.
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I just noticed yesterday that my Cablevision/Optimum cable bill carries a separate line item $2.98 monthly fee for Sports Programming Surcharge.
Yup, you're going to see more and more of that. That is to try to cover some of the RSN costs, but it doesn't even come close. The RSN costs per month in a place like New York can be close to $15 a month for an operator.
MSG +
MSG
SNY
YES
So operators are trying to get some of those dollars back. The operators would love to take the RSNs out of the base packages completely and sell them a la carte because the costs are so high, but the RSNs refuse because they want the eyeballs for the advertising. So then you have this fun situation where if you don't carry the RSN, the diehard fans leave you and go to a distributor that will. For that distributor, it has to charge even if you don't like sports.
It's the situation currently in Houston with the Rockets and Astros where many major distributors refuse to carry. In your neck of the woods, DISH has basically given up on sports fans entirely by not carrying most of the New York based RSNs...too costly. In the Spring, with the new Dodgers channel coming, many distributors will have a hard decision to make for an enormously priced channel that they have to decide is it worth carrying knowing they have to raise everyone's bill and not everyone cares about the Dodgers, or do they say no to the Dodgers and lose customers as a result.
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“Most channels are owned by the same handful of large media companies that seek to maximize revenue across all of their channels,” says Greg Ireland, a research manager at IDC who follows the industry. “By bundling channels, they’re able to get carriage fees and advertising revenue on channels that perhaps wouldn’t get carriage if offered on their own. This model, while problematic for some consumers (and some pay-TV operators), isn’t broken from the media company perspective and they don’t necessarily want to make changes that upset the current formula.”
Chico's this is the most interesting paragraph to me. Using the record industry again (and I understand it isn't apples to apples) as an example - they felt the exact same way. Their old model represented max profits for them. But it was a combination of new technology and consumer demands that forced the change. No way of knowing how this shakes out price-wise, but the consumer will force changes to the current model of cable TV as well.
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Next contract announced, $5.2 billion from Rogers to the NHL....huge increase. Sports rights up up up again....consumers will have to pay for it
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“Most channels are owned by the same handful of large media companies that seek to maximize revenue across all of their channels,” says Greg Ireland, a research manager at IDC who follows the industry. “By bundling channels, they’re able to get carriage fees and advertising revenue on channels that perhaps wouldn’t get carriage if offered on their own. This model, while problematic for some consumers (and some pay-TV operators), isn’t broken from the media company perspective and they don’t necessarily want to make changes that upset the current formula.”
Chico's this is the most interesting paragraph to me. Using the record industry again (and I understand it isn't apples to apples) as an example - they felt the exact same way. Their old model represented max profits for them. But it was a combination of new technology and consumer demands that forced the change. No way of knowing how this shakes out price-wise, but the consumer will force changes to the current model of cable TV as well.
Until the consumer realizes they will pay $75 for 25 channels instead of $90 for 150. That's the other part of the story. Now, someone will say I only watch 15 channels, while his wife will say the same thing (only they are a different 15 channels) and their kids will watch a different 15 channels, etc, etc.
Wait until the political howling comes into play as well....when a channel targeted for certain groups can't survive without shared distribution. BET...can it survive where only customers that want it will pay for it? Not a chance....do you think politicians are going to let BET die....we'll see.
The consumers you talk of want to only pay for the channels they watch, of course they also want great content for which the content companies can't produce without guaranteed revenues which they get from the current model. Take one leg out from the tripod and it collapses. Fun times.
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Until the consumer realizes they will pay $75 for 25 channels instead of $90 for 150. That's the other part of the story. Now, someone will say I only watch 15 channels, while his wife will say the same thing (only they are a different 15 channels) and their kids will watch a different 15 channels, etc, etc.
Wait until the political howling comes into play as well....when a channel targeted for certain groups can't survive without shared distribution. BET...can it survive where only customers that want it will pay for it? Not a chance....do you think politicians are going to let BET die....we'll see.
The consumers you talk of want to only pay for the channels they watch, of course they also want great content for which the content companies can't produce without guaranteed revenues which they get from the current model. Take one leg out from the tripod and it collapses. Fun times.
I totally see what you are saying, but won't you concede it should at least be an option for consumers to pay $75 for 25 channels? Or $50 for 10 channels? I realize the price per channel goes up. But that still might make sense for some people. Not everyone is married. Not everyone has kids. You talk about millenials...millenials are staying single and putting off having kids. 10 might be enough for some people. And they might be willing to pay more per channel to save $30-$40 a month in their overall bill. Why can't this be an option? I honestly probably watch less than 10 channels with any regularity. And they all start with ESP and FS.
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Until the consumer realizes they will pay $75 for 25 channels instead of $90 for 150. That's the other part of the story. Now, someone will say I only watch 15 channels, while his wife will say the same thing (only they are a different 15 channels) and their kids will watch a different 15 channels, etc, etc.
Wait until the political howling comes into play as well....when a channel targeted for certain groups can't survive without shared distribution. BET...can it survive where only customers that want it will pay for it? Not a chance....do you think politicians are going to let BET die....we'll see.
The consumers you talk of want to only pay for the channels they watch, of course they also want great content for which the content companies can't produce without guaranteed revenues which they get from the current model. Take one leg out from the tripod and it collapses. Fun times.
Nice whistle there using BET as your example, well played.
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Next contract announced, $5.2 billion from Rogers to the NHL....huge increase. Sports rights up up up again....consumers will have to pay for it
And at the point where consumers say "no mas" to the increases then 1.) the companies inking these long-term deals lose money, and 2.) the next contracts are signed for less money.
It's not a given that it's a one way arrow up forever.
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And at the point where consumers say "no mas" to the increases then 1.) the companies inking these long-term deals lose money, and 2.) the next contracts are signed for less money.
It's not a given that it's a one way arrow up forever.
I don't believe that sports demand is inelastic, so eventually, there will be a breaking point and the market will adjust.
That breaking point might not come for a while, but at some point people can't or will chose not to pay for expensive sports content.
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I totally see what you are saying, but won't you concede it should at least be an option for consumers to pay $75 for 25 channels? Or $50 for 10 channels? I realize the price per channel goes up. But that still might make sense for some people. Not everyone is married. Not everyone has kids. You talk about millenials...millenials are staying single and putting off having kids. 10 might be enough for some people. And they might be willing to pay more per channel to save $30-$40 a month in their overall bill. Why can't this be an option? I honestly probably watch less than 10 channels with any regularity. And they all start with ESP and FS.
Sure....convince Disney, Fox, A&E, Rainbow, Viacom, etc to do that. Convince them that they will allow the distributors to sell their channels in this manner and allow us to do the same. Good luck with it.
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Nice whistle there using BET as your example, well played.
I'm giving you the most obvious example, one that has been used in the industry many times. Their ratings are not good, they primarily serve a small audience, they cannot survive on their own.
I could give other examples, but that one is the one that resonates with politicians pretty quickly.
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I don't believe that sports demand is inelastic, so eventually, there will be a breaking point and the market will adjust.
That breaking point might not come for a while, but at some point people can't or will chose not to pay for expensive sports content.
Yup....of course we have been hearing this argument for the last 15 years, ever since I got into this business and it hasn't come close to even slowing, let alone going the other way.
I'll believe it when I see it. Not saying it won't happen or can't happen, but I haven't seen it. Today's Rogers contract with the NHL is just another example of how far it is still going the other way. With FS1 here in the states, it will only drive UP sports rights even more in the coming years, not down.
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Sure....convince Disney, Fox, A&E, Rainbow, Viacom, etc to do that. Convince them that they will allow the distributors to sell their channels in this manner and allow us to do the same. Good luck with it.
You previously said it was impossible because consumers would not accept it. Are you at least now conceding that they might?
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You previously said it was impossible because consumers would not accept it. Are you at least now conceding that they might?
Today, the way the contracts are written and the economics that are in place, it is not possible. I also said that consumers are not going to accept the reality of it. We test this stuff all the time, we would LOVE to offer a la carte. Believe me, if we didn't have to carry some of these channels we are forced to carry, we wouldn't but we have no choice.
Here is usually how the research and focus groups go.
Customer: I want to pay only for the channels that I watch.
TV Distributor: Great. So today you are paying $80 for 145 channels. How much would you like to pay?
Customer: I want to pay $45 a month.
TV Distributor: OK, what channels are important to you and your family? How many do you care about?
Customer: I only care about 10 or so, but my husband really likes ESPN even though I hate sports. My kids watch Nick at night and Cartoon Network and MTV. So I guess if we add it all up about 40 channels
TV Distributor: OK, well for $45 you will be able to get about 10 of those channels. Unless you don't want ESPN, then you can probably get about 20, would that be ok with your husband?
Customer: Well no. I don't understand. If I get 145 channels for $80, isn't that less than $2 per channel? Shouldn't I be able to get about 80 channels for $45?
TV Distributor: I'm sorry maam, but that's the benefit of bundling because those content companies are spreading out their costs over multiple channels. ESPN is about $5 for us because we can guarantee them 15 million subscribers. If those numbers aren't guaranteed to them, they have to charge $20 or so for ESPN, maybe more. So you can lower your bill, but you will get a lot less and it sounds like you won't be able to get the channels your family watches. Do you still want to do this?
Customer: Well I don't like this one bit.
You get the idea. It sounds so simple, until the pesky details come out and it falls apart time after time after time. But believe me, we would LOVE it. We will spend over $10 BILLION in programming costs this year. Many of those channels are bundled in and we (plus everyone else) has no choice, but to carry it. If you want ESPN, you MUST carry ESPN Classic, and Longhorn, etc, etc. You want to carry MTV, you MUST carry Palladia. So on so forth.
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Chicos, I definitely understand the situation. And it sucks that consumers all attack the distributors, because that's not the problem. It's the whole system. You need system-wide changes. Sports, TV, entertainment, etc are all way too expensive. When I think about athletes making 10 million a year, it's so ridiculous. And the examples go on and on. Prices/salaries/whatever need to come down across the board. It just doesn't seem like a sustainable situation long-term.
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Today, the way the contracts are written and the economics that are in place, it is not possible. I also said that consumers are not going to accept the reality of it. We test this stuff all the time, we would LOVE to offer a la carte. Believe me, if we didn't have to carry some of these channels we are forced to carry, we wouldn't but we have no choice.
Here is usually how the research and focus groups go.
Customer: I want to pay only for the channels that I watch.
TV Distributor: Great. So today you are paying $80 for 145 channels. How much would you like to pay?
Customer: I want to pay $45 a month.
TV Distributor: OK, what channels are important to you and your family? How many do you care about?
Customer: I only care about 10 or so, but my husband really likes ESPN even though I hate sports. My kids watch Nick at night and Cartoon Network and MTV. So I guess if we add it all up about 40 channels
TV Distributor: OK, well for $45 you will be able to get about 10 of those channels. Unless you don't want ESPN, then you can probably get about 20, would that be ok with your husband?
Customer: Well no. I don't understand. If I get 145 channels for $80, isn't that less than $2 per channel? Shouldn't I be able to get about 80 channels for $45?
TV Distributor: I'm sorry maam, but that's the benefit of bundling because those content companies are spreading out their costs over multiple channels. ESPN is about $5 for us because we can guarantee them 15 million subscribers. If those numbers aren't guaranteed to them, they have to charge $20 or so for ESPN, maybe more. So you can lower your bill, but you will get a lot less and it sounds like you won't be able to get the channels your family watches. Do you still want to do this?
Customer: Well I don't like this one bit.
You get the idea. It sounds so simple, until the pesky details come out and it falls apart time after time after time. But believe me, we would LOVE it. We will spend over $10 BILLION in programming costs this year. Many of those channels are bundled in and we (plus everyone else) has no choice, but to carry it. If you want ESPN, you MUST carry ESPN Classic, and Longhorn, etc, etc. You want to carry MTV, you MUST carry Palladia. So on so forth.
Fair enough. Maybe my situation is rare, I'm just saying that I personally would be willing to pay for just sports programming. And enough to cover the costs and maintain margins for the cable providers. I know that ESPN is the most expensive channel on the planet. I would gladly pay $10 per channel for the channels I want. Because my bill would still be cut in half. But I recognize maybe most people don't think like I do.
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Until the consumer realizes they will pay $75 for 25 channels instead of $90 for 150. That's the other part of the story. Now, someone will say I only watch 15 channels, while his wife will say the same thing (only they are a different 15 channels) and their kids will watch a different 15 channels, etc, etc.
You keep using these examples, but right now your industry is getting $0 for 0 channels from a LOT of millennials and a lot of Gen-Xers. If I had to buy 20 different fruits just to get an orange at the grocery store, I would buy nothing. You can either create more marketable options, or get nothing.
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Chicos, I definitely understand the situation. And it sucks that consumers all attack the distributors, because that's not the problem. It's the whole system. You need system-wide changes. Sports, TV, entertainment, etc are all way too expensive. When I think about athletes making 10 million a year, it's so ridiculous. And the examples go on and on. Prices/salaries/whatever need to come down across the board. It just doesn't seem like a sustain't I dimble situation long-term.
Customers will have the final say - just takes a few years. Happened in music, movies, even TV shows are distributed differently. It will happen to cable TV as well.
What we don't know yet is the form it will take. Cable subscriptions are on a downward trend, viewership (on TV) is declining. So things will change. When and how are to be determined.
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Fair enough. Maybe my situation is rare, I'm just saying that I personally would be willing to pay for just sports programming. And enough to cover the costs and maintain margins for the cable providers. I know that ESPN is the most expensive channel on the planet. I would gladly pay $10 per channel for the channels I want. Because my bill would still be cut in half. But I recognize maybe most people don't think like I do.
Many of us are in the same boat. I watch sports, HBO, Showtime and MSNBC. Very little else. Any series that I watch are on Roku - and Netlix and HuluPlus are a lot cheaper than paying for all of the unwanted channels.
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Yup....of course we have been hearing this argument for the last 15 years, ever since I got into this business and it hasn't come close to even slowing, let alone going the other way.
I'll believe it when I see it. Not saying it won't happen or can't happen, but I haven't seen it. Today's Rogers contract with the NHL is just another example of how far it is still going the other way. With FS1 here in the states, it will only drive UP sports rights even more in the coming years, not down.
You're right. I can't pretend to know sports television well enough to predict the ultimate market correction. It might not occur for a long time.
I'm merely looking at it from an economics 101 standpoint. Some products are very inelastic, but EVERY product has a breaking point.
ANNNND if you really want to go down the wormhole, if traditional professional sports become "expensive", it does open up the marketplace for cheaper alternatives and/or alternate delivery mechanisms. It's basic economics.
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You're right. I can't pretend to know sports television well enough to predict the ultimate market correction. It might not occur for a long time.
I'm merely looking at it from an economics 101 standpoint. Some products are very inelastic, but EVERY product has a breaking point.
ANNNND if you really want to go down the wormhole, if traditional professional sports become "expensive", it does open up the marketplace for cheaper alternatives and/or alternate delivery mechanisms. It's basic economics.
Like the growth of the X-games. I'd venture to guess that more kids play on their bikes and boards than play baseball. During the summer it's easy to find kids doing this, but go to any park and the diamonds are empty.
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We need the ATA (Affordable TV Act) to solve the problem.
(no politics.)
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People will go on there computer to rent movies? Nerds.
Best regards,
Blockbuster and Planet Video
/Jim Rome'ed
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You keep using these examples, but right now your industry is getting $0 for 0 channels from a LOT of millennials and a lot of Gen-Xers. If I had to buy 20 different fruits just to get an orange at the grocery store, I would buy nothing. You can either create more marketable options, or get nothing.
It's cute, but your examples aren't the same. To produce that orange is a lot different than producing television content or sports content, and that's what those making the content will argue every day.
As for the millennials, yup but that begs another question that our industry and many others are sorting through. They don't have much money PERIOD, so what is it that they are willing to pay for when so many of them think the world runs on pixie dust? :D There are some that are willing to pay, as I mentioned in the recent study I was involved in, but the question is it worth going down that path. That is why what happens in the economy in the next 10 years will drive much of this.
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Customers will have the final say - just takes a few years. Happened in music, movies, even TV shows are distributed differently. It will happen to cable TV as well.
What we don't know yet is the form it will take. Cable subscriptions are on a downward trend, viewership (on TV) is declining. So things will change. When and how are to be determined.
Cable down, satellite up, Telco up...you forgot that part. Cable has been down for a decade.
Using music is a fool's argument, I don't know why you go there.
Movies, another wrong argument. The movies are going to be made either way, because they are made for the movie theater first, then EST (electronic sell thru)...they have a monetization path setup. Renting movies on Netflix or Redbox or DISH isn't changing any of that...it's just a different delivery system.
What you guys are ignoring, time and time again is sports and non-movies. That is the key. For sports to work, they have to have dedicated revenues, which a la carte CANNOT deliver. The math does not work. For every day television, they are in the same boat, though not exactly the same, but because their model is based on subscription revenue and advertising revenue, both from NUMBERS OF EYEBALLS, they can't make the math work on a la carte model. Not today. Maybe someday, but not even close today. Sell it a la carte, all the distributors say BYE BYE to that programming and they lose 80 million to 100 million eyeballs...there goes their ad revenue and their subscription revenue.
You need to solve for that first before you get want you are looking for. Plenty of very smart people have tried to solve that and failed. Apple, Intel, Google, HBO, etc, etc, etc...all have failed. These aren't stupid people or stupid companies.
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Like the growth of the X-games. I'd venture to guess that more kids play on their bikes and boards than play baseball. During the summer it's easy to find kids doing this, but go to any park and the diamonds are empty.
Not here in So. Cal, the diamonds are used often. But let's say we use your example, go to the soccer fields and the soccer fields are PACKED all the time and have been for several decades so surely soccer is the most popular sports in the USA now.......
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Many of us are in the same boat. I watch sports, HBO, Showtime and MSNBC. Very little else. Any series that I watch are on Roku - and Netlix and HuluPlus are a lot cheaper than paying for all of the unwanted channels.
MSNBC......
(http://puppetbuzz.com/wp-content/uploads/2007/03/187397_500.jpg)
Um, you do realize that those shows you watch on Roku are subsidized by the current model....right? I hope you do, but I sense you don't. In other words, they have been monetized through the process already to whether they get to Netflix, etc, they sold off cheaply. Now, what's going to happen in the coming years is Netflix is going to have to charge a TON more for those shows because the revenue windows are shifting and as they shift, the content producers are going to get their dollars from someone.
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Um, you do realize that those shows you watch on Roku are subsidized by the current model....right? I hope you do, but I sense you don't. In other words, they have been monetized through the process already to whether they get to Netflix, etc, they sold off cheaply. Now, what's going to happen in the coming years is Netflix is going to have to charge a TON more for those shows because the revenue windows are shifting and as they shift, the content producers are going to get their dollars from someone.
We are going in circles. I am in total agreement that the revenue windows are shifting. But you seem to believe (correct me if I am wrong) that the new model will look very much like the old. That is really the one point where we differ.
And as much as you don't want to look at the music industry, it is similar as to the company/s plan of attack. Which is that they will drive the decision. Well they didn't see Shawn Fanning coming. And they under-estimated the public's hunger for change.
Yes the cable and satellite companies will still get there money - but anyone that says they know how things are going to shake out is fooling themselves.
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It's cute, but your examples aren't the same. To produce that orange is a lot different than producing television content or sports content, and that's what those making the content will argue every day.
As for the millennials, yup but that begs another question that our industry and many others are sorting through. They don't have much money PERIOD, so what is it that they are willing to pay for when so many of them think the world runs on pixie dust? :D There are some that are willing to pay, as I mentioned in the recent study I was involved in, but the question is it worth going down that path. That is why what happens in the economy in the next 10 years will drive much of this.
When anyone - millennial or otherwise - wants a product, they will pay for it. I see and work with many every day. They are perfectly fine shelling out triple digit payments every month for cell phones, for new cars, for expensive clothes, for songs on iTunes. They must believe they are getting the full value of their dollars on their purchases or they wouldn't be making them every month.
Guess what they aren't spending their money on? Your products.
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Chicos industry is based on the same premise as Obamacare. Get as many people as possible to subsidize the interests of other people and have them pay a fortune for products they don't need or don't want.
Is it any wonder, when it comes to obscene satellite bills featuring products no one wants to watch, and 300% increases in monthly premiums for crap they don't want or need, that people are just simply deciding to opt out?
Basic economics, Chicos.
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When anyone - millennial or otherwise - wants a product, they will pay for it. I see and work with many every day. They are perfectly fine shelling out triple digit payments every month for cell phones, for new cars, for expensive clothes, for songs on iTunes. They must believe they are getting the full value of their dollars on their purchases or they wouldn't be making them every month.
Guess what they aren't spending their money on? Your products.
Not exactly.
Let me share part of the research we did with millenials earlier this month. I am paraphrasing, but its pretty close (this we repeated by a number of interviewees in one sense or another....not all, but enough that it was a common theme). It was interesting to us that certain things they believed should be FREEEEEEEEEEEEEEEEEEEEEEEEEE and not compensated for, but other items should be. Mostly it was due to enabling. You can't get that Starbucks for free unless your friend is working behind the counter. Clothes, cars, same thing, but if you can find a way to get things for free...the morality barometer takes a nosedive. It's easier to get tv for free than a car.
Interviewer: What video programming do you watch?
Grad student: I love Game of Thrones, True Blood and Walking Dead
Interviewer: So you have a subscription to HBO then?
Grad Student: Well, no. I just watch it on the torrents, pirated stuff
Interviewer: Why do you do that?
Grad Student: HBO is too expensive, I don't want to pay for it and tv.
Interviewer: If you could get HBO directly without the TV part, would you buy it?
Grad Student: Honestly, no. I can get it for free and all this stuff should be free. It's the public airwaves.
Interviewer: Interesting. You do realize it costs money, in fact Game of Thrones is several hundred million dollars to make that show. If people don't pay for it, shows like this cannot be made. Incidentally, broadcast television uses the public airwaves, not HBO.
Grad Student: Yeah, but there are enough people out there paying for it that I don't have to worry about that. I bought a HBO t-shirt once, so I gave them some money.
Interviewer: What are you studying?
Grad Student: Graphic design
Interviewer: How would you feel if the work you did was no longer paid for, that people should be able to enjoy your work without having to pay for it?
Grad Student: That's different, I won't be working for a company that makes billions of dollars most likely
Interviewer: Thank you for sharing your thoughts with us.
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Chicos industry is based on the same premise as Obamacare. Get as many people as possible to subsidize the interests of other people and have them pay a fortune for products they don't need or don't want.
Is it any wonder, when it comes to obscene satellite bills featuring products no one wants to watch, and 300% increases in monthly premiums for crap they don't want or need, that people are just simply deciding to opt out?
Basic economics, Chicos.
300% increases in monthly premiums...seriously, what are you talking about? Our rates went up 4.5% last year to the consumer, despite our programming costs going up 8%...we take the much bigger hit.
As for your comparison to Obamacare, uhm....no. It isn't against the law to not have television or pay a fine if you don't, it is with Obamacare. It isn't against the law to downgrade to a different package, not get HBO, etc. Not even close to the comparison. Believe me, I think O-Care is a disaster for any number of reasons, but to compare the two is just wrong.
You want to complain, contact Disney, NewsCorp, Viacom, Turner, Rainbow, the NFL, NBA, NHL, the players unions, SAG, the writers, producers, actors, etc, etc, etc. Get to the source.
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300% increases in monthly premiums...seriously, what are you talking about? Our rates went up 4.5% last year to the consumer, despite our programming costs going up 8%...we take the much bigger hit.
As for your comparison to Obamacare, uhm....no. It isn't against the law to not have television or pay a fine if you don't, it is with Obamacare. It isn't against the law to downgrade to a different package, not get HBO, etc. Not even close to the comparison. Believe me, I think O-Care is a disaster for any number of reasons, but to compare the two is just wrong.
You want to complain, contact Disney, NewsCorp, Viacom, Turner, Rainbow, the NFL, NBA, NHL, the players unions, SAG, the writers, producers, actors, etc, etc, etc. Get to the source.
Health care premiums, Chicos. Though I didn't realize you also call your bills "premiums." Interesting.
It's very comparable. The only way for your business model to work is for lots of people to pay for products they don't want or need. Same with Obamacare. Unfortunately for both industries, people are opting out.
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Not exactly.
Let me share part of the research we did with millenials earlier this month. I am paraphrasing, but its pretty close (this we repeated by a number of interviewees in one sense or another....not all, but enough that it was a common theme). It was interesting to us that certain things they believed should be FREEEEEEEEEEEEEEEEEEEEEEEEEE and not compensated for, but other items should be. Mostly it was do to enabling. You can't get that Starbucks for free unless you friend is working behind the counter. Clothes, cars, same thing, but if you can find a way to get it for free...the morality barometer takes a nosedive.
Interviewer: What video programming do you watch?
Grad student: I love Game of Thrones, True Blood and Walking Dead
Interviewer: So you have a subscription to HBO then?
Grad Student: Well, no. I just watch it on the torrents, pirated stuff
Interviewer: Why do you do that?
Grad Student: HBO is too expensive, I don't want to pay for it and tv.
Interviewer: If you could get HBO directly without the TV part, would you buy it?
Grad Student: Honestly, no. I can get it for free and all this stuff should be free. It's the public airwaves.
Interviewer: Interesting. You do realize it costs money, in fact Game of Thrones is several hundred million dollars to make that show. If people don't pay for it, shows like this cannot be made. Incidentally, broadcast television uses the public airwaves, not HBO.
Grad Student: Yeah, but there are enough people out there paying for it that I don't have to worry about that. I bought a HBO t-shirt once, so I gave them some money.
Interviewer: What are you studying?
Grad Student: Graphic design
Interviewer: How would you feel if the work you did was no longer paid for, that people should be able to enjoy your work without having to pay for it?
Grad Student: That's different, I won't be working for a company that makes billions of dollars most likely
Interviewer: Thank you for sharing your thoughts with us.
Very amusing example, I'll grant you that. Are you hoping that somehow the gap of people who have "cut the cord" consists entirely of pirates, and also that somehow more regulation will force them to pay up? I wonder if you realize to what extent people have "tuned" television out. I know a lot of people who might catch a television show on Netflix or on DVD, if enough people recommend it. But they aren't so obsessed with the latest shows that they need to have triple digit per month TV bills or wade through the swamp of illegal online viewing.
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Here's who you have to convince....based on what he and others are saying....not looking good.
http://www.forbes.com/sites/jeffbercovici/2013/08/08/21st-century-foxs-chase-carey-a-la-carte-is-a-fantasy/
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Apple...failed
Intel...just threw in the towel last month.... http://www.reuters.com/article/2013/11/20/us-intel-tv-insight-idUSBRE9AJ17620131120 (not that I didn't tell you guys here 8 months ago it would fail, which of course it did.... sigh )
Google.... nope...failed.
Maybe some day, but it comes down to the content creators. You want what you are asking for, you have to convince the content creators. Good luck
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Not exactly.
Let me share part of the research we did with millenials earlier this month. I am paraphrasing, but its pretty close (this we repeated by a number of interviewees in one sense or another....not all, but enough that it was a common theme). It was interesting to us that certain things they believed should be FREEEEEEEEEEEEEEEEEEEEEEEEEE and not compensated for, but other items should be. Mostly it was do to enabling. You can't get that Starbucks for free unless you friend is working behind the counter. Clothes, cars, same thing, but if you can find a way to get it for free...the morality barometer takes a nosedive.
Interviewer: What video programming do you watch?
Grad student: I love Game of Thrones, True Blood and Walking Dead
Interviewer: So you have a subscription to HBO then?
Grad Student: Well, no. I just watch it on the torrents, pirated stuff
Interviewer: Why do you do that?
Grad Student: HBO is too expensive, I don't want to pay for it and tv.
Interviewer: If you could get HBO directly without the TV part, would you buy it?
Grad Student: Honestly, no. I can get it for free and all this stuff should be free. It's the public airwaves.
Interviewer: Interesting. You do realize it costs money, in fact Game of Thrones is several hundred million dollars to make that show. If people don't pay for it, shows like this cannot be made. Incidentally, broadcast television uses the public airwaves, not HBO.
Grad Student: Yeah, but there are enough people out there paying for it that I don't have to worry about that. I bought a HBO t-shirt once, so I gave them some money.
Interviewer: What are you studying?
Grad Student: Graphic design
Interviewer: How would you feel if the work you did was no longer paid for, that people should be able to enjoy your work without having to pay for it?
Grad Student: That's different, I won't be working for a company that makes billions of dollars most likely
Interviewer: Thank you for sharing your thoughts with us.
I think morality has very little to do with it. This is really human nature. People respond to incentives, and if they are able to get free content and for them the benefits outweigh the risks, they will do it. I can afford paying for content and for me it's worth it to avoid the (small) risk of some sort of legal action being brought against me, and the (larger) risk of infecting my computing devices with malware. However, for a lot of broke people in my generation, the math doesn't lead them to the same conclusion. And until producers of content give people a viable legal alternative to paying $80+ a month for a cable subscription, content will continue to be stolen and producers of content will lose out on the potential revenue of alternatives.
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Health care premiums, Chicos. Though I didn't realize you also call your bills "premiums." Interesting.
It's very comparable. The only way for your business model to work is for lots of people to pay for products they don't want or need. Same with Obamacare. Unfortunately for both industries, people are opting out.
We don't call bill premiums, but there is a part of the service that is called premiums. HBO, Showtime, Playboy, Starz, Encore, Epix, Cinemax are called premium services on most distributor services.
Its not comparable. You can't get cheap insurance any longer, catastrophic insurance. You can get base packages for tv if you wish and everyone would be fine....sure, less revenue, but a lot less cost as well. You have choices for TV, you extremely limited choices for insurance. You're a dude, too bad you are getting pregnancy coverage...that's the law. Yet if you don't want tv, drop it, if you don't want 250 channels, then get 150, get 70 and pay $29 a month...you have many options....put an antenna on your roof and get it for FREEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE
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Very amusing example, I'll grant you that. Are you hoping that somehow the gap of people who have "cut the cord" consists entirely of pirates, and also that somehow more regulation will force them to pay up? I wonder if you realize to what extent people have "tuned" television out. I know a lot of people who might catch a television show on Netflix or on DVD, if enough people recommend it. But they aren't so obsessed with the latest shows that they need to have triple digit per month TV bills or wade through the swamp of illegal online viewing.
First off, I would recommend you put cutting the cord into proper frame. Context is everything. In the last quarter, the industry lost 113,000 net subs. The year prior, 101,000. For an industry that has over 100,000,000 subscribers it's a small number. Important? Of course. Is the world ending tomorrow? No.
Agree, many people, especially your age, aren't obsessed with it. Totally understand it. My kids aren't, they have their shows, but would much rather be gaming, stealing, or whatever. ;)
One of the issues with piracy is if the industry ever goes to an a la carte model, the predictions are piracy becomes exponentially worse. Why? Because those that find value in ESPN today won't at $20 to $25 a month for one channel, but they'll be more than willing to find a way to pirate it. Some very interesting anti-pirating stuff coming down the pike, especially on the enforcement legislation side. Politicians know who butters their bread and the Disney, NewsCorp, Viacoms, CBS' etc of the world don't like their stuff stolen, it leaves less $$$$ to go into politicians hands. :) I think you will be rather surprised at some of the next waves of enforcement coming down, especially as they work with the pipe providers (the networks) to crack down at the account level of the end user. You're probably to young to remember the RIAA lawsuits, that will be a walk in the park.
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New study out today on a la carte....at least 124 channels would be eliminated, higher costs for consumers, 1.4 million jobs lost.
Total financial loss into the system from advertising, etc...$80 billion to $113 billion.
Can't wait to hear the politicians sign up for this and all those lost tax revenues as a result.
http://www.latimes.com/entertainment/envelope/cotown/la-et-ct-a-la-carte-pricing-would-cost-billions-of-dollars-20131204,0,4355658.story#axzz2mYDT0I00
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New study out today on a la carte....at least 124 channels would be eliminated, higher costs for consumers, 1.4 million jobs lost.
Total financial loss into the system from advertising, etc...$80 billion to $113 billion.
Can't wait to hear the politicians sign up for this and all those lost tax revenues as a result.
http://www.latimes.com/entertainment/envelope/cotown/la-et-ct-a-la-carte-pricing-would-cost-billions-of-dollars-20131204,0,4355658.story#axzz2mYDT0I00
I didn't spend a lot of time with this, but the "loss" of advertising revenue ($45B I think) is unlikely. Sure, it won't go to the disappearing networks but it will certainly go somewhere else (surviving nets, digital, etc.) It wouldn't just evaporate.
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I didn't spend a lot of time with this, but the "loss" of advertising revenue ($45B I think) is unlikely. Sure, it won't go to the disappearing networks but it will certainly go somewhere else (surviving nets, digital, etc.) It wouldn't just evaporate.
I believe what they were saying is that some would certainly shift to other mediums, but the net impact is not all of it could be shifted and thus the $45b hit is a net number.
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I wonder who has been saying that since the get-go. It isn't technology folks, its content.
Great article on Intel's failure and why Apple, Google, etc have not been able to crack it either.
http://news.cnet.com/8301-1023_3-57613334-93/how-intel-tv-failed-pay-attention-google-and-apple/
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A la carte is a farce.....says FOX COO (not my words, but that's how many of the content makers view it)
http://www.multichannel.com/technology/carey-la-carte%E2%80%99s-%E2%80%98farce%E2%80%99/147126
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A la carte is a farce.....says FOX COO (not my words, but that's how many of the content makers view it)
http://www.multichannel.com/technology/carey-la-carte%E2%80%99s-%E2%80%98farce%E2%80%99/147126
We understand Chicos. Of course they say that - this is how they make their money.
Record companies also said the same thing. Until they didn't. 20 years ago it was unimaginable that we could get ALL of our music without ever buying a physical CD, but....
I think our point is that things will change. We don't know how yet, but they absolutely will change.
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I can afford cable but refuse to pay for it. I paid for decades and cut the cord last fall.
I love my current no cable set up and love only having a bill for 9 bucks or whatever for Netflix.
I have over the air via antennas in my attic, with a lot of PBS and multiple options on sub-channels. I get all the networks from chicago and milwaukee, and a lot more choices of the type of shows I like to watch (PBS) than on cable where they gave me one PBS station.
I have a Tivo with a 1T hard drive added, which works a lot better than the crappy DVR's that the cable company rented to me (no monthly fee on the Tivo, I got it free from someone who was upgrading, and even if there was, I'd buy it up front and it would pay for itself in a few months by not having cable).
The thing that is really making it a great experience is the added over the air channel choice and my Apple TV. With the Smithsonian, PBS, and now Bloomberg (just added) on Apple TV, it is really nice to just go and watch full episodes without having to Tivo them or know when they are on. Having Bloomberg added will be really nice as it adds a 24/7 "true" station to the Apple TV mix. I hope Apple TV adds a Kahnacademy App next.
Finally, Netflix does it for my daughter, and i watch a show or movie here or there on netflix and enjoy the convenience for Ted Talks.
The above: Antenna, Apple TV and NetFlix is so much better than having cable. I really don't even want to add cable and all those junk channels. For my viewing, this is so much better other than ESPN and Fox Sports missing. Do I miss ESPN and Fox Sports? Yes, a little, but if there is a game I really want to watch, I just plan dinner or lunch around it at a friends or a bar. I am not a big fan of watching random teams play and have better things to do, so I don't miss it much, and the advantages out way the negatives by far.
I tell you what. A couple more decent Apps on Apple TV and the cord cutting will continue to escalate. The cable industry is paying attention and trying some low tier basic cheaper packages without ESPN. If those take off or if Aereo is declared legal, it is pretty much over for cable. The networks won't pull over the air and instead will stream to devices like Apple TV, etc.
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We understand Chicos. Of course they say that - this is how they make their money.
Record companies also said the same thing. Until they didn't. 20 years ago it was unimaginable that we could get ALL of our music without ever buying a physical CD, but....
I think our point is that things will change. We don't know how yet, but they absolutely will change.
+10,000. All of the people getting obscenely rich (athletes, owners, networks, talent, tv execs, etc.) from the present rigged wheel system will (for selfish reasons) say "we're different" than other industries who have to compete for their customers.
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+10,000. All of the people getting obscenely rich (athletes, owners, networks, talent, tv execs, etc.) from the present rigged wheel system will (for selfish reasons) say "we're different" than other industries who have to compete for their customers.
It also wasn't foreseeable that people would buy one or two songs from an album and not buy the whole album. Think of it like alacarte for the music industry. Big change not only in how music is sold due to the technology change, but also how it is sold as individual songs instead of an entire CD/Album at 16 bucks or whatever they cost now.
I saw an article a few weeks ago about some rumblings re the future of sports on cable and how unsustainable it probably is... I agree.
I admit I can be a cheap guy (no, I don't download free stuff or watch games on the internet for free and would never do that)... But as an example my cable company started charging $5.99 for the 8 year old modem that I had from them... i bought my own and returned theirs.. not because of the $5.99 a month but rather the way they went about it and without giving me a decent new modem. They try to quietly ripoff the customers, and that is no way to run a business. It was a hassle that probably wasn't worth saving the $5.99 a month, but I had to get my own modem on principle.
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A big disruption could be coming within a year or a little more, if the U.S. Supreme Court agrees to hear the Aereo case. If they don't hear it, then the slower disruption continues. Aereo rebroadcasts network TV over the internet, with each subscriber having their own unique antenna. From a legal point of view, it is a very interesting case.
If the U.S.S.C decides in favor of the broadcasters/cable companies, it slows the disruption down.
A win for aereo could really speed things up as far as cord cutting.
http://www.bloomberg.com/news/2013-12-12/aereo-urges-u-s-supreme-court-to-hear-broadcast-tv-case.html
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A big disruption could be coming within a year or a little more, if the U.S. Supreme Court agrees to hear the Aereo case. If they don't hear it, then the slower disruption continues. Aereo rebroadcasts network TV over the internet, with each subscriber having their own unique antenna. From a legal point of view, it is a very interesting case.
If the U.S.S.C decides in favor of the broadcasters/cable companies, it slows the disruption down.
A win for aereo could really speed things up as far as cord cutting.
http://www.bloomberg.com/news/2013-12-12/aereo-urges-u-s-supreme-court-to-hear-broadcast-tv-case.html
I agree on Aereo - except I don't expect them to win.
I use a Roku for Netflix and also have access to hundreds of channels. Like Cable TV most are junk but there are about a half dozen decent ones besides Netflix. If it wasn't for Sports I would cut cable completely.
But back at the turn of the century record execs were adamant that you got the whole album or nothing - they only changed when enough people chose nothing. THEN, the changed their sales model - something they said they could never do and still survive.
Cable can afford to lose 500,000 - 1,000,000 customers a year for a few years, but if the number starts to go where they are losing 2% - 3% a year, they will 'suddenly' figure out that there are new innovative sales models to use.
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I agree on Aereo - except I don't expect them to win.
I use a Roku for Netflix and also have access to hundreds of channels. Like Cable TV most are junk but there are about a half dozen decent ones besides Netflix. If it wasn't for Sports I would cut cable completely.
But back at the turn of the century record execs were adamant that you got the whole album or nothing - they only changed when enough people chose nothing. THEN, the changed their sales model - something they said they could never do and still survive.
Cable can afford to lose 500,000 - 1,000,000 customers a year for a few years, but if the number starts to go where they are losing 2% - 3% a year, they will 'suddenly' figure out that there are new innovative sales models to use.
That has always been my point. They are not unique. They don't have to do it like they do it. They're not looking out for the consumer. They're looking out for themselves. They do what they do because they can get away with it. If push comes to shove, the market will see to it that content costs less and that their own salaries become more reasonable. And, of course, the consumer will benefit.
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That has always been my point. They are not unique. They don't have to do it like they do it. They're not looking out for the consumer. They're looking out for themselves. They do what they do because they can get away with it. If push comes to shove, the market will see to it that content costs less and that their own salaries become more reasonable. And, of course, the consumer will benefit.
+1
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We understand Chicos. Of course they say that - this is how they make their money.
Record companies also said the same thing. Until they didn't. 20 years ago it was unimaginable that we could get ALL of our music without ever buying a physical CD, but....
I think our point is that things will change. We don't know how yet, but they absolutely will change.
Difference is, the record companies actually let it happen. The television content companies aren't, not any time soon.
I'm just passing on what they are saying. We would love to offer a la carte, but pretty clear those that make the content have absolutely no desire to sell their services that way.
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A big disruption could be coming within a year or a little more, if the U.S. Supreme Court agrees to hear the Aereo case. If they don't hear it, then the slower disruption continues. Aereo rebroadcasts network TV over the internet, with each subscriber having their own unique antenna. From a legal point of view, it is a very interesting case.
If the U.S.S.C decides in favor of the broadcasters/cable companies, it slows the disruption down.
A win for aereo could really speed things up as far as cord cutting.
http://www.bloomberg.com/news/2013-12-12/aereo-urges-u-s-supreme-court-to-hear-broadcast-tv-case.html
The secret to the Aereo case isn't the content, it's the antenna....just wait until the antenna gets exposed. Their argument is that there is a unique antenna for each customer, thus they are not violating any rights. This is not what the broadcasters are fighting them on, but it's the silver bullet for them in my opinion. From an engineering standpoint, what they claim is impossible. What they are actually doing is using many antennas together to form an array, that's quite different than what they claim. The engineers have been laughing about this for quite some time. On the business side, it's great for distributors because they have to pay the networks a ton of money to carry them. So if Aereo wins, you'll see the distributors buy Aereo or license their technology (or something similar) in their own boxes and not have to write enormous checks to Fox, CBS, NBC, ABC. Win win. Of course, CBS and FOX have already said if they lose in court, they will simply go all cable and take their networks off the network air and be treated just like ESPN. A threat? Maybe.
It is interesting, will be very interesting to see how it goes. The friends of the court briefs against Aereo have been very interesting.
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I agree on Aereo - except I don't expect them to win.
I use a Roku for Netflix and also have access to hundreds of channels. Like Cable TV most are junk but there are about a half dozen decent ones besides Netflix. If it wasn't for Sports I would cut cable completely.
But back at the turn of the century record execs were adamant that you got the whole album or nothing - they only changed when enough people chose nothing. THEN, the changed their sales model - something they said they could never do and still survive.
Cable can afford to lose 500,000 - 1,000,000 customers a year for a few years, but if the number starts to go where they are losing 2% - 3% a year, they will 'suddenly' figure out that there are new innovative sales models to use.
Sigh. Hands are tied. If ESPN requires they be distributed in 90% to all subscribers, then there isn't a whole lot of "new innovative sales models"....that's been the beef for many years.
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Sigh. Hands are tied. If ESPN requires they be distributed in 90% to all subscribers, then there isn't a whole lot of "new innovative sales models"....that's been the beef for many years.
Appreciate your input, Chicos. You certainly have access to more inside info than Lenny or I and I tend to agree with you on the aereo case. I'm sure in a couple years we will look back at this and someone will be able to say "told you so".
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This excerpt I always found interesting from an article on the subject:
"Last fall I had an interesting conversation with an influential player in the TV and movie production business, who explained the fear and loathing with which Apple is viewed in Hollywood.
Part of the problem, he told me, is that the video guys all saw what happened to the music guys after they got in bed with Apple. But also, "Steve Jobs came down here and did meetings in Hollywood, talking to people who've been in this business for 25 years, and he told these guys, `You're all a bunch of idiots. You're dinosaurs.' The response from the Hollywood guys was, `Go f@ck yourself.'"
As far as Hollywood is concerned, "Apple is scary. Steve Jobs was scary. There's a fear of empowering Apple. No one here has a vested interest in helping to build that up. It's a scary time, and do you really want an 800-pound gorilla controlling your pricing?"
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@GOO
How in the world do you watch MU basketball? If you're a big enough fan to participate in a fan forum I cannot believe you are content to not watch games.
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This excerpt I always found interesting from an article on the subject:
"Last fall I had an interesting conversation with an influential player in the TV and movie production business, who explained the fear and loathing with which Apple is viewed in Hollywood.
Part of the problem, he told me, is that the video guys all saw what happened to the music guys after they got in bed with Apple. But also, "Steve Jobs came down here and did meetings in Hollywood, talking to people who've been in this business for 25 years, and he told these guys, `You're all a bunch of idiots. You're dinosaurs.' The response from the Hollywood guys was, `Go f@ck yourself.'"
As far as Hollywood is concerned, "Apple is scary. Steve Jobs was scary. There's a fear of empowering Apple. No one here has a vested interest in helping to build that up. It's a scary time, and do you really want an 800-pound gorilla controlling your pricing?"
Interesting!!
I think Jobs was looking 5-10 years out and the studio guys were/are happy with current model. I think it ends up falling somewhere between what they each envisioned.
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Sigh. Hands are tied. If ESPN requires they be distributed in 90% to all subscribers, then there isn't a whole lot of "new innovative sales models"....that's been the beef for many years.
but with enough backlash could ESPN ever be forced to cave on that 90%? It's their business model that needs changing if enough foks that don't watch sports cut the cable. If that tipping comes maybe ESPN will have to eat some $ and just perhaps rein in sports costs i.e. athlete's salaries etc.
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Interesting!!
I think Jobs was looking 5-10 years out and the studio guys were/are happy with current model. I think it ends up falling somewhere between what they each envisioned.
Actually, he wanted it done back then, but the video guys knew (still know), they can't create the programming people want with that model. For every hit, you have a bunch of bombs that are enormous in costs to create. On the music side, the risk is so much smaller. It cost next to nothing to make an album vs making a television show.
This is why comparing the two industries is always problematic. People want the music model, but they still want Walking Dead, Game of Thrones, Madmen, etc created. Those two combinations are going to be very difficult to pull off in an a la carte world which Jobs either didn't understand or didn't want to come to grips with.
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but with enough backlash could ESPN ever be forced to cave on that 90%? It's their business model that needs changing if enough foks that don't watch sports cut the cable. If that tipping comes maybe ESPN will have to eat some $ and just perhaps rein in sports costs i.e. athlete's salaries etc.
Sure, but it hasn't come close to happening. People pack stadiums, watch sports, demand sports. The issue is more from the non sports fans that don't want to pay for sports which they are forced to pay today. The tipping point will come from them, if it comes at all. But who is going to be the first distributor to say no to ESPN and refuse to carry it? The first one that does is going to get hammered. Thus the problem.
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But who is going to be the first distributor to say no to ESPN and refuse to carry it? The first one that does is going to get hammered. Thus the problem.
one word: collusion ;)
maybe we need a distributor conspiracy
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one word: collusion ;)
maybe we need a distributor conspiracy
Yeah, illegal. ;)
Plus, the contracts for each distributor are not synced. For example, DISH's came up this year, Time Warner was a few years ago, etc, etc. Disney isn't dumb, they will make sure they do not end in the same years to prevent exactly what you are saying.
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@GOO
How in the world do you watch MU basketball? If you're a big enough fan to participate in a fan forum I cannot believe you are content to not watch games.
I attend about half the games in person. I listen to Mac and Homer over my phone ESPN app. I actually enjoy it, as I get stuff done while I listen (household type tasks) that I wouldn't get done watching it on TV. That being said, if I could spend 10-15 bucks a few times a year and watch a few games, I'd do so:
In the UK:
Apple has added a couple of new channels to the Apple TV for UK users. The addition of Sky Sports (provide through Now TV) makes live sports available to UK owners of Apple TV for the first time without the need for a cable subscription. Users can buy £9.99 day passes and get unlimited access to all six Sky Sports channels encompassing the Barclays Premier League football matches, cricket, F1 racing and more.
Now TV and Sky Sports are both owned by the same parent company BSkyB, which makes this deal possibly. Compared to a monthly cable subscription, the day-pass option is not cost-effective but it may be enticing to some people who only want to watch certain events across the year.
Chicos, thanks for the info on Aereo, if they can't distribute content from a certain antenna to a certain recipient, it would seem to be a hugh hole in the case for Aereo and an easy way for the courts to distinguish this case and rule against Aereo.
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https://www.techdirt.com/articles/20130118/17425221736/cable-industry-finally-admits-that-data-caps-have-nothing-to-do-with-congestion.shtml??
again, the problem is much MUCH bigger than the cable companies.
having said that, shocking news here!! the cable companies are doing things that are pretty scummy overall
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https://www.techdirt.com/articles/20130118/17425221736/cable-industry-finally-admits-that-data-caps-have-nothing-to-do-with-congestion.shtml??
again, the problem is much MUCH bigger than the cable companies.
having said that, shocking news here!! the cable companies are doing things that are pretty scummy overall
I have no problem if they clamp down on them....especially since I don't work for a cable company. :D However, from what I understand from the engineers that do handle this stuff, if you don't tier it and put artificial barriers in place (through price controls), you will cause a problem as people overly stream like crazy. There's a reason why the more water you use, the highered tiers kick in. Same for electricity, you go through various tiers with higher usage.
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I have no problem if they clamp down on them....especially since I don't work for a cable company. :D However, from what I understand from the engineers that do handle this stuff, if you don't tier it and put artificial barriers in place (through price controls), you will cause a problem as people overly stream like crazy. There's a reason why the more water you use, the highered tiers kick in. Same for electricity, you go through various tiers with higher usage.
Sounds like you might be one of their lawyers :o
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I have no problem if they clamp down on them....especially since I don't work for a cable company. :D However, from what I understand from the engineers that do handle this stuff, if you don't tier it and put artificial barriers in place (through price controls), you will cause a problem as people overly stream like crazy. There's a reason why the more water you use, the highered tiers kick in. Same for electricity, you go through various tiers with higher usage.
Water and electricity have to be produced for people to use them. So, the more you use, the more you should pay. With data? No. This is just like when cell companies were charging for texts, when they didn't need to.
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Sounds like you might be one of their lawyers :o
LOL. I'm now going to kill myself.
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Water and electricity have to be produced for people to use them. So, the more you use, the more you should pay. With data? No. This is just like when cell companies were charging for texts, when they didn't need to.
That is true, but they physics of delivery don't change for the cable guys. There are only so many packets they can deliver at any time, and if the request for packets of data increases to the point it degrades their ability to deliver, that is a problem.
Ever try to get a network signal, or even 3G or 4G in a stadium? Very difficult because everyone is pulling at the same time.
This is why the delivery over the internet of video is still such a huge problem for single based events. We actually brought down HBO Go last year (us, DISH and Charter) for Game of Thrones because they did a preview of episode 2 right after episode 1 on Go only. It crashed their system because too many people at one single point in time it couldn't handle. That's just a specific example, but there are other broader examples that the cable guys are worried about in terms of performance metrics and what the network can truly absorb.
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That is true, but they physics of delivery don't change for the cable guys. There are only so many packets they can deliver at any time, and if the request for packets of data increases to the point it degrades their ability to deliver, that is a problem.
Ever try to get a network signal, or even 3G or 4G in a stadium? Very difficult because everyone is pulling at the same time.
This is why the delivery over the internet of video is still such a huge problem for single based events. We actually brought down HBO Go last year (us, DISH and Charter) for Game of Thrones because they did a preview of episode 2 right after episode 1 on Go only. It crashed their system because too many people at one single point in time it couldn't handle. That's just a specific example, but there are other broader examples that the cable guys are worried about in terms of performance metrics and what the network can truly absorb.
i'd buy more into this if the cable guys ever actually worried about "performance metrics". a large majority of the time, people aren't receiving the bandwidth they pay for anyway. joe schmo wouldn't really notice much difference, but he's not getting what he paid for most of the time anyway.
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i'd buy more into this if the cable guys ever actually worried about "performance metrics". a large majority of the time, people aren't receiving the bandwidth they pay for anyway. joe schmo wouldn't really notice much difference, but he's not getting what he paid for most of the time anyway.
The analogy to electricity is app. Electricity has a limiting factor, the generation of it. Very expensive to build new generation capability, but you have to account for the "worst" case scenario. As an example 5% of the energy generation capability in the LA region is used less than 50 hours per year, but they had to spend millions to have that 5% available.
Same goes for data, there is a physical limit to how much data they can push through the infrastructure as well as move with the servers. You have to have infrastructure and servers to support the worse case from a customer satisfaction standpoint but you have to have some way to pay for that.
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i'd buy more into this if the cable guys ever actually worried about "performance metrics". a large majority of the time, people aren't receiving the bandwidth they pay for anyway. joe schmo wouldn't really notice much difference, but he's not getting what he paid for most of the time anyway.
This is true, but I think they say "up to X Mbps" for that reason. They can't predict necessarily the load on their networks which is why at times if the load is heavy, they won't be able to deliver the same throughput then say at 3:00am.
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Nothing to with a la carte. Or anything of that ilk. But an interesting article nonetheless. I wonder if netflix, hulu, espn3, etc think the same way?
http://bgr.com/2014/01/20/hbo-go-login-sharing-policy/
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Nothing to with a la carte. Or anything of that ilk. But an interesting article nonetheless. I wonder if netflix, hulu, espn3, etc think the same way?
http://bgr.com/2014/01/20/hbo-go-login-sharing-policy/
It's funny, I read a similar article about 8 months ago and again 3 months ago. I was with HBO a few weeks in New York and I point blanked them if they truly support what is in these articles, because if they do they have a major problem. They told me at basically one level below the CEO they do not support this and they are trying to curtail it.
So, number one I thank you for sharing this article because I'm getting ready to send it to their #2 right now and ask again WTF? They are concerned about subscription revenue and having everyone bust their arses for this stuff and they make statements like this. Not good. Decide what you want (you meaning HBO). They say it doesn't impact business, they're in denial. Of course it does. I have the data to prove it.
Thanks for sharing....I truly mean that.
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It's funny, I read a similar article about 8 months ago and again 3 months ago. I was with HBO a few weeks in New York and I point blanked them if they truly support what is in these articles, because if they do they have a major problem. They told me at basically one level below the CEO they do not support this and they are trying to curtail it.
So, number one I thank you for sharing this article because I'm getting ready to send it to their #2 right now and ask again WTF? They are concerned about subscription revenue and having everyone bust their arses for this stuff and they make statements like this. Not good. Decide what you want.
Thanks for sharing....I truly mean that.
So their CEO is saying one thing, and the rest of the company (executives) believe something totally different? Probably not the best atmosphere there...
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So their CEO is saying one thing, and the rest of the company (executives) believe something totally different? Probably not the best atmosphere there...
Well, because the part of the company I deal with is responsible for selling it so when they hear their CEO say that kind of stuff they're like WTF. I have data surveys of millenials and others showing absolutely it impacts business. We have several former Netflix employees on the team now, and they know for a fact in has impacted Netflix subscriptions. I don't know why this guy is saying this...I know he would like to believe that people borrowing a login will magically say I want it myself. The reality is that people that borrow the login want to keep on borrowing the login. No different than people here wanting a free stream for a MU game, they have no intention of paying for it.
EDIT: Just fired off my email. I normally sit on that stuff, reread it, make sure I'm saying the right thing. Not tonight, off it went. Again, appreciate the article. Likely would have had it tomorrow morning as our research team pulls all of this stuff daily, but glad I got it tonight. Take care.
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Well, because the part of the company I deal with is responsible for selling it so when they hear their CEO say that kind of stuff they're like WTF. I have data surveys of millenials and others showing absolutely it impacts business. We have several former Netflix employees on the team now, and they know for a fact in has impacted Netflix subscriptions. I don't know why this guy is saying this...I know he would like to believe that people borrowing a login will magically say I want it myself. The reality is that people that borrow the login want to keep on borrowing the login. No different than people here wanting a free stream for a MU game, they have no intention of paying for it.
Fair enough. I can tell you I used to share a Netflix account with a couple buddies. We'd all pitch in some $$ and one guy would set it up.
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http://www.chicagotribune.com/business/sns-rt-us-amazon-paytv-20140121,0,4156461.story
No real details here, but interesting nonetheless
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Aaaaannnnddd, Amazon denies it:
http://www.bizjournals.com/milwaukee/morning_roundup/2014/01/amazon-denies-creation-of-streaming-tv.html
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http://www.chicagotribune.com/business/sns-rt-us-amazon-paytv-20140121,0,4156461.story
No real details here, but interesting nonetheless
Yup, former boss of mine leading the effort........
All comes down to what the content companies (Disney, Viacom, NewsCorp, etc will sell their content for).
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Aaaaannnnddd, Amazon denies it:
http://www.bizjournals.com/milwaukee/morning_roundup/2014/01/amazon-denies-creation-of-streaming-tv.html
Everyone has tried to kick the tires on this...Apple, Google, Intel, Amazon, etc. Intel threw in the towel officially yesterday by selling their infrastructure to Verizon yesterday for unspecified terms (rumored to be asking for $500 million).
None of them can make a go at it because the power is in the hands of the content makers as discussed here many many times. We'll see how Amazon is doing. They can deny it, but they are kicking the tires like everyone else and the spreadsheets don't lie. Not yet anyway. Times will change, but the revolution that people predicted in 2010 2011 2012 2013 2014 is so extremely complicated that people just don't understand the mechanics of it. Some day will it happen, probably but unlikely in the form people think. Is some day in 2015 or 2020 or ..... ?
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Latest...the economic disparity is huge.
http://www.engadget.com/2014/02/05/time-warner-reveals-how-much-money-hbo-makes-and-why-its-not-s/?a_dgi=gravity
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Latest...the economic disparity is huge.
http://www.engadget.com/2014/02/05/time-warner-reveals-how-much-money-hbo-makes-and-why-its-not-s/?a_dgi=gravity
Wow. The margins of HBO vs. Netflix is astounding, given their revenue is about the same.
How do they do it? Especially with how expensive Game of Thrones is to make...I don't get it...
Is Netflix just overpaying for content?
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Wow. The margins of HBO vs. Netflix is astounding, given their revenue is about the same.
How do they do it? Especially with how expensive Game of Thrones is to make...I don't get it...
Is Netflix just overpaying for content?
The irony is, Netflix's biggest bills haven't even hit yet. $5.5 BILLION coming their way in expenses over the next 36 months. They aren't charging enough. They are trying to grow their way to prosperity with volume, but that is a strategy that can only go so far....then when they have to raise their rates a lot of the folks that are on the lower end of the economic food chain will drop them as a result. Interesting times ahead, for everyone. Challenging, because we totally get what the customers want, have to deal with what the channels want ($$), etc, etc. I'm right in the middle of it...hair getting greyer by the day.
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Interesting update from SNL Kagan today.
"With 85% of movies and nearly 93% of TV series unavailable on Netflix Inc"
Hypothesizing when customer churn start to ramp up for lack of content.
Reminds me of this banner from the Honest Corporate Slogans spoof done last year
(http://www.everyjoe.com/wp-content/uploads/2014/02/netflix-honest-slogan.jpg)
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http://www.businessinsider.com/comcast-to-buy-time-warner-cable-2014-2
Where the hell is the DOJ or FCC on these deals? Did our anti-monopoly laws just get locked in a drawer somewhere and forgotten about? Bad enough when Comcast was allowed to buy NBC-Universal (no coincidence at all one of the FCC executives who pushed through that deal ended up becoming an executive at Comcast-Universal shortly after... ::))
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http://www.businessinsider.com/comcast-to-buy-time-warner-cable-2014-2
Where the hell is the DOJ or FCC on these deals? Did our anti-monopoly laws just get locked in a drawer somewhere and forgotten about? Bad enough when Comcast was allowed to buy NBC-Universal (no coincidence at all one of the FCC executives who pushed through that deal ended up becoming an executive at Comcast-Universal shortly after... ::))
All of those free marketers get very quiet over a deal like this. Rather than supporting competition in the marketplace to control prices, they just turn and walk away.
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All of those free marketers get very quiet over a deal like this. Rather than supporting competition in the marketplace to control prices, they just turn and walk away.
Amen.
They do it because it helps their stock profile.
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http://www.businessinsider.com/comcast-to-buy-time-warner-cable-2014-2
Where the hell is the DOJ or FCC on these deals? Did our anti-monopoly laws just get locked in a drawer somewhere and forgotten about? Bad enough when Comcast was allowed to buy NBC-Universal (no coincidence at all one of the FCC executives who pushed through that deal ended up becoming an executive at Comcast-Universal shortly after... ::))
Give the process time. The companies have to announce their intentions before it can be reviewed by regulators, and this stuff can take months to go through regulatory approval. I'm sure it will get a very close look by US regulators, and I doubt it goes through as-is to be very honest.
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http://www.businessinsider.com/comcast-to-buy-time-warner-cable-2014-2
Where the hell is the DOJ or FCC on these deals? Did our anti-monopoly laws just get locked in a drawer somewhere and forgotten about? Bad enough when Comcast was allowed to buy NBC-Universal (no coincidence at all one of the FCC executives who pushed through that deal ended up becoming an executive at Comcast-Universal shortly after... ::))
Think about, how is it less competition? TWC and Comcast already have municipal monopolies. You can't have two cable companies in the same territory today. All that is happening here is one buying out the other's territory....no changes. The competition comes from Directv, Dish, Fios, Uverse. Now, if the FCC, FTC, DOJ, etc allowed Dish and Directv to merge, that would truly reduce competition.
As for a gov't official getting a job......SHOCKING. Sounds like the reverse with all the "impartial" media members that have cozy jobs with this administration. SHOCKING.
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All of those free marketers get very quiet over a deal like this. Rather than supporting competition in the marketplace to control prices, they just turn and walk away.
You clearly need to research this one a little bit more, then come back. How is competition, IN THIS CASE, reduced since it is already IMPOSSIBLE for a customer to choose between TWC and COMCAST today. The option DOES NOT EXIST. Anyone living in any of these cities where either of these cable companies do business today still have the EXACT same choices
A cable company
Two satellite companies
One telephone company (the telephone companies also have territories, you can choose FIOS or UVERSE, it's one or the other if they even are there at all)
I look forward to the answer. ;)
Apparently all those liberal pro gov't folks may have jumped the gun on this one. :D
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Think about, how is it less competition? TWC and Comcast already have municipal monopolies. You can't have two cable companies in the same territory today. All that is happening here is one buying out the other's territory....no changes. The competition comes from Directv, Dish, Fios, Uverse. Now, if the FCC, FTC, DOJ, etc allowed Dish and Directv to merge, that would truly reduce competition.
As for a gov't official getting a job......SHOCKING. Sounds like the reverse with all the "impartial" media members that have cozy jobs with this administration. SHOCKING.
False. I have 2 different cable companies I can pick from where I live in Chicago, Comcast and RCN. Maybe not true everywhere, but certainly true in a lot of bigger markets.
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You clearly need to research this one a little bit more, then come back. How is competition, IN THIS CASE, reduced since it is already IMPOSSIBLE for a customer to choose between TWC and COMCAST today. The option DOES NOT EXIST. Anyone living in any of these cities where either of these cable companies do business today still have the EXACT same choices
A cable company
Two satellite companies
One telephone company (the telephone companies also have territories, you can choose FIOS or UVERSE, it's one or the other if they even are there at all)
I look forward to the answer. ;)
Apparently all those liberal pro gov't folks may have jumped the gun on this one. :D
As I said in my above post, despite your convincing use of caps lock, that is not true everywhere. Many markets have multiple cable companies to choose from.
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False. I have 3 different cable companies I can pick from where I live in Chicago. Maybe not true everywhere, but certainly true in a lot of bigger markets.
Cable service is a monopoly in literally 98% of this country. If you live in pocket that allows you to get more than one, you are the lucky 2%ers.... In those RARE instances when they overlap, TWC and Comcast have already said they will divest those subscribers...problem solved.
And it is certainly NOT true in most bigger markets. I have maps and maps and maps of every cable market in every DMA in this country. They are very neatly carved out and only ONE is allowed in those markets with VERY few exceptions. In those exceptions, it's still one cable company owning the cable and another is providing an overlay on top of their lines. In those situations, check out the difference between them....usually its the company logo on the bill, and that's it. Simply because that overlay company is essentially just renting the line, doing business with the owner of that line, etc. Think of it in the old days of Covad and various ISPs like Earthlink, etc. Municipalities didn't want an existing cable company that already laid the copper to have another one come in, tear up all the streets to lay new copper down. Plus, the other cable companies don't want to spend all that money knowing there is an incumbent already there, makes no business sense for them to do so.
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Cable service is a monopoly in literally 98% of this country. If you live in pocket that allows you to get more than one, you are the lucky 2%ers.... In those RARE instances when they overlap, TWC and Comcast have already said they will divest those subscribers...problem solved.
And it is certainly NOT true in most bigger markets. I have maps and maps and maps of every cable market in every DMA in this country. They are very neatly carved out and only ONE is allowed in those markets with VERY few exceptions. In those exceptions, it's still one cable company owning the cable and another is providing an overlay on top of their lines. In those situations, check out the difference between them....usually its the company logo on the bill, and that's it. Simply because that overlay company is essentially just renting the line, doing business with the owner of that line, etc. Think of it in the old days of Covad and various ISPs like Earthlink, etc. Municipalities didn't want an existing cable company that already laid the copper to have another one come in, tear up all the streets to lay new copper down. Plus, the other cable companies don't want to spend all that money knowing there is an incumbent already there, makes no business sense for them to do so.
I did correct it to 2. I thought it was 3, but I was wrong.
You are correct, it is an overlay service. I do think that this is still a good thing. . The model is working for electric utilities. If every market had a Comcast and an overlay, consumers would benefit, if not from better prices than at least from improved customer service.
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Cable service is a monopoly in literally 98% of this country. If you live in pocket that allows you to get more than one, you are the lucky 2%ers.... In those RARE instances when they overlap, TWC and Comcast have already said they will divest those subscribers...problem solved.
And it is certainly NOT true in most bigger markets. I have maps and maps and maps of every cable market in every DMA in this country. They are very neatly carved out and only ONE is allowed in those markets with VERY few exceptions. In those exceptions, it's still one cable company owning the cable and another is providing an overlay on top of their lines. In those situations, check out the difference between them....usually its the company logo on the bill, and that's it. Simply because that overlay company is essentially just renting the line, doing business with the owner of that line, etc. Think of it in the old days of Covad and various ISPs like Earthlink, etc. Municipalities didn't want an existing cable company that already laid the copper to have another one come in, tear up all the streets to lay new copper down. Plus, the other cable companies don't want to spend all that money knowing there is an incumbent already there, makes no business sense for them to do so.
+1
Anyone remember Ma Bell?
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National, state, county...can drill down to the street level if needed, but these are how the territories are divided through almost all of the country...I'm using public maps, not proprietary ones.
(http://tvbythenumbers.zap2it.com/wp-content/uploads/2011/01/top_10_MSO_footprints.jpg)
(http://1m0esx2939yhjwld8419obqhyb.wpengine.netdna-cdn.com/wp-content/uploads/2012/10/LAKERS_CABLE_GRAPHIC.jpg)
(http://www.calcable.org/wp-content/uploads/2013/03/CA_CableProvider_map.jpg)
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I did correct it to 2. I thought it was 3, but I was wrong.
You are correct, it is an overlay service. I do think that this is still a good thing. . The model is working for electric utilities. If every market had a Comcast and an overlay, consumers would benefit, if not from better prices than at least from improved customer service.
What is the incentive for a company to do that? Ultimately, that is the question you would need to ask. If an incumbent has been there for 30+ years, paying that incumbent to be an overlay is very costly, then you likely have to cut your rates to get people to even consider switching which reduces your margins....and the kicker...you're using their cable line so the service quality is exactly the same as the other guy (it's his line). If his line has artifacts in it, or whatever, then you get those, too.
The only way I see any of that ever working is if there is joint or multiple ownership of the line, but that also presents massive problems from an operational point of view.
I get why you would want it, but I think if you dig deeper into the realities of why it almost never happens there is a clear reason why. It makes no economic sense to invest that kind of money for almost no return.
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Cable service is a monopoly in literally 98% of this country. If you live in pocket that allows you to get more than one, you are the lucky 2%ers.... In those RARE instances when they overlap, TWC and Comcast have already said they will divest those subscribers...problem solved.
And it is certainly NOT true in most bigger markets. I have maps and maps and maps of every cable market in every DMA in this country. They are very neatly carved out and only ONE is allowed in those markets with VERY few exceptions. In those exceptions, it's still one cable company owning the cable and another is providing an overlay on top of their lines. In those situations, check out the difference between them....usually its the company logo on the bill, and that's it. Simply because that overlay company is essentially just renting the line, doing business with the owner of that line, etc. Think of it in the old days of Covad and various ISPs like Earthlink, etc. Municipalities didn't want an existing cable company that already laid the copper to have another one come in, tear up all the streets to lay new copper down. Plus, the other cable companies don't want to spend all that money knowing there is an incumbent already there, makes no business sense for them to do so.
But isn't this a problem in itself?? Again, monopoly. If consumers don't have choices, they lose. It's said the gov't can't or won't do anything about situations like this. Yes, over-regulation is a problem, but it's not as though companies would regulate themselves if the gov't weren't around in these situations.
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But isn't this a problem in itself?? Again, monopoly. If consumers don't have choices, they lose. It's said the gov't can't or won't do anything about situations like this. Yes, over-regulation is a problem, but it's not as though companies would regulate themselves if the gov't weren't around in these situations.
Flip the question. Say a brand new community springs up and they want cable infrastructure in their town. They go to Comcast, TWC, Charter, Cox, etc and say we want you all to provide service here. OK. Now let's do the math. Each of them is going to spend enormous dollars to lay that system in knowing they might get 10%, 20% share....pay back in 30 years from now. What's the interest level going to be from those companies considering the capital cost to put all that stuff in? Low to non existent. Remember, this is hard wired stuff, not over the air....that's the advantage satellite has had (no trenches to be dug, no cable to be laid...no infrastructure costs).
Now, if you say we want bids from each of you and you will own the territory so you can recoup your cost in a reasonable time period, what's the interest? Much higher and why the system exists today.
Now, if you want the gov't to lay the cable, the gov't to own the cable...that's an option...they tend to do so many other things so well and are so customer oriented, that could be a solution.
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What is the incentive for a company to do that? Ultimately, that is the question you would need to ask. If an incumbent has been there for 30+ years, paying that incumbent to be an overlay is very costly, then you likely have to cut your rates to get people to even consider switching which reduces your margins....and the kicker...you're using their cable line so the service quality is exactly the same as the other guy (it's his line). If his line has artifacts in it, or whatever, then you get those, too.
The only way I see any of that ever working is if there is joint or multiple ownership of the line, but that also presents massive problems from an operational point of view.
I get why you would want it, but I think if you dig deeper into the realities of why it almost never happens there is a clear reason why. It makes no economic sense to invest that kind of money for almost no return.
It happens all the time in electric utilities. Its everywhere in the Chicagoland region.
The reason is simple, there's lots of money to be made.
The big utility, Commonwealth Edison, has fat margins. So some other guy pays to overlay, and still makes big profits, with slightly lesser margins. ComEd takes the free money up front, for a potential loss in market share, and the new guy competes by offering better rates and customer service.
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http://www.businessinsider.com/comcast-to-buy-time-warner-cable-2014-2
Where the hell is the DOJ or FCC on these deals? Did our anti-monopoly laws just get locked in a drawer somewhere and forgotten about? Bad enough when Comcast was allowed to buy NBC-Universal (no coincidence at all one of the FCC executives who pushed through that deal ended up becoming an executive at Comcast-Universal shortly after... ::))
By the way, don't underestimate Comcast snuggling with this administration. Brian Roberts (CEO) s a big Obama donor as are many of his lieutenants. Odds are, this gets passed....with restrictions, but I would be surprised if it doesn't get through.
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By the way, don't underestimate Comcast snuggling with this administration. Brian Roberts (CEO) s a big Obama donor as are many of his lieutenants. Odds are, this gets passed....with restrictions, but I would be surprised if it doesn't get through.
Oh, I have no doubt it will go through. Too much money involved.
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I was wrong, less than 1% of cable companies overlap territories in the United States. I said 2% this morning. Got the data today. If you truly are in the less than 1%, you are in a very rare situation.
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I was wrong, less than 1% of cable companies overlap territories in the United States. I said 2% this morning. Got the data today. If you truly are in the less than 1%, you are in a very rare situation.
That's interesting. Having lived in Chicago and Indianapolis, I've been lucky to have at least 2 choices. 3 in Indy.
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That's interesting. Having lived in Chicago and Indianapolis, I've been lucky to have at least 2 choices. 3 in Indy.
Whichever one you don't live in now, can you share that zip code? I suspect you think you had 2 or 3, but you actually didn't. Humor me and I can source it pretty quickly.
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Whichever one you don't live in now, can you share that zip code? I suspect you think you had 2 or 3, but you actually didn't. Humor me and I can source it pretty quickly.
I believe I had 3 in 46203. (comcast, brighthouse, uverse)
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I believe I had 3 in 46203. (comcast, brighthouse, uverse)
Uverse isn't cable, it's a Telco..it's AT&T fiber television (though much of it is still copper)....just like FiOS isn't cable, it is also a Telco (Verizon). I think that's where a lot of the confusion comes in, people lump them all together but they aren't.
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Uverse isn't cable, it's a Telco..it's AT&T fiber television (though much of it is still copper)....just like FiOS isn't cable, it is also a Telco (Verizon). I think that's where a lot of the confusion comes in, people lump them all together but they aren't.
Gotcha. Well, 2 then, I guess.
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Gotcha. Well, 2 then, I guess.
You are one of the rarest of the rares. I don't know your street address, but looking at Sherman and other streets in that zip code, two cable providers...Comcast (Xfinity..same thing) and Brighthouse. You are a 1%er. Wear it proudly.
BrightHouse is a unique story in that it used to be several other companies and TWC still negotiates all their deals on their behalf, so they are essentially TWC light, but they are their own company now since 2003.
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ESPN launched 15 conference-specific channels for its online outlet, WatchESPN, the media company announced on Thursday.
The channels can be streamed to television via Apple TV or Roku, and they will feature live men's and women's college basketball games and replays of college football games. With conference basketball tournaments on the horizon, ESPN is offering a platform for most Division I conferences around the country. Those included are the ACC, America East, Atlantic Sun, Big South, Big West, MEAC, SWAC, CIA, Horizon, MAC, MAAC, Missouri Valley, Northeast, Ohio Valley, Southern, Sun Belt and Southland. ESPN plans on broadcasting more than 2,000 live men's and women's games during conference tournaments.
The deal doesn't include the Big Ten, Big 12, Pac-12 or SEC because those conferences either already have or are planning to launch their own networks.
http://www.sbnation.com/2014/2/27/5453344/espn-conference-channels-watchespn
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ESPN launched 15 conference-specific channels for its online outlet, WatchESPN, the media company announced on Thursday.
The channels can be streamed to television via Apple TV or Roku, and they will feature live men's and women's college basketball games and replays of college football games. With conference basketball tournaments on the horizon, ESPN is offering a platform for most Division I conferences around the country. Those included are the ACC, America East, Atlantic Sun, Big South, Big West, MEAC, SWAC, CIA, Horizon, MAC, MAAC, Missouri Valley, Northeast, Ohio Valley, Southern, Sun Belt and Southland. ESPN plans on broadcasting more than 2,000 live men's and women's games during conference tournaments.
The deal doesn't include the Big Ten, Big 12, Pac-12 or SEC because those conferences either already have or are planning to launch their own networks.
http://www.sbnation.com/2014/2/27/5453344/espn-conference-channels-watchespn
Damon Phillips...good buddy of mine, former DIRECTV employee. This is all for lower end conferences. They aren't going to do anything that hurts their $$$$ streams. ESPN has some really big contracts up this year and they need to get carriage for the SEC network. Fun fun times.
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Damon Phillips...good buddy of mine, former DIRECTV employee. This is all for lower end conferences. They aren't going to do anything that hurts their $$$$ streams. ESPN has some really big contracts up this year and they need to get carriage for the SEC network. Fun fun times.
The ACC being the exception
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The ACC being the exception
From what I understand, you're talking about things like ACC women's field hockey, or some obscure games in other sports, though I'm trying to get confirmation. Here again is where this gets very interesting. You have ESPN wanting to launch these things and monetize them, while also jacking up their prices considerably for satellite, cable and telco distributors while ALSO trying to get all of them to carry SEC and other services. You can imagine how that can get rather complicated very quickly.
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Spoke to him today, actually it will have men's and women's hoops, even some football. Here's the part none of the articles spoke of.....authentication required on all. Basically you need to be a subscriber of pay television to get it.
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U.S. sides with the networks over Aereo in friend of the court brief.
http://news.cnet.com/8301-1023_3-57619849-93/us-sides-with-networks-against-aereo-in-supreme-court-fight/
Going to be interesting
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U.S. sides with the networks over Aereo in friend of the court brief.
http://news.cnet.com/8301-1023_3-57619849-93/us-sides-with-networks-against-aereo-in-supreme-court-fight/
Going to be interesting
i wonder why... ::)
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i wonder why... ::)
Copyright law means something in this country, and Aereo is violating copyright law. That's for starters.
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Copyright law means something in this country, and Aereo is violating copyright law. That's for starters.
That's the crux of the issue. If a band puts their music online for free, it isn't a copyright issue if people download it and play it. Aereo is arguing it is not a violation because the content they are distributing is available for free to anyone that wants it. They claim that since these are over the air channels whose content they want to distribute, rather than cable channels who charge a fee to broadcast their content, they are not in violation of any law.
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Hoopalooping this thread to see how Chicos reconciles this with his claim that this would never happen
http://www.nytimes.com/2014/04/24/business/amazon-to-offer-original-hbo-content.html?_r=0
Yes, mostly older shows (although not entirely, some new stuff too). But I think this is just the beginning. This model will take off.
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Hoopalooping this thread to see how Chicos reconciles this with his claim that this would never happen
http://www.nytimes.com/2014/04/24/business/amazon-to-offer-original-hbo-content.html?_r=0
Yes, mostly older shows (although not entirely, some new stuff too). But I think this is just the beginning. This model will take off.
LOL. Uhm, no. This is a licensing deal, nothing more. I've been involved with this for some time because of the contractual issues for MVPDs. When the announcement was made yesterday I was waiting to see who would bring this up first. The amount of incorrect data in the media yesterday about this deal was funny to watch. I probably had 7 calls with HBO yesterday about the inaccuracies being reported. You said some "new stuff"..exactly what new stuff would that be? Shows currently running like VEEP? Not exactly.
The deal is for content 3+ years and older. Certain series are excluded ENTIRELY....little tiny series like Game of Thrones, Curb Your Enthusiasm, True Detective franchise, etc, etc. This is why I say "not exactly" for the new stuff. Sure, VEEP content will be on there, but you have to wait for it to be 3 years old or older. If you had a HBO subscription, you get all of that stuff included with no wait as part of OnDemand or HBO Go.
When I say licensing deal, no different than what HBO has done with Sex and the City on TBS, SpikeTV and such. It's a way for them to monetize old stuff. The guy who did the deal for Amazon is Brad Beale, a former colleague of mine. He's an engineer by trade, but got in on the programming side with Amazon a few years ago.
Let's be clear on what I also said in the past. I did not say it will never happen, I said this idea it is happening soon just because people want it too is wrong. HBO makes billions off MVPDS without having to incur the lion's share of marketing costs, no support costs (call centers, agents, etc) and few technical costs. An enormous savings for them. If they decide to go direct, which certainly they can, they get to incur those things. They also know the billions they get now is in jeopardy. The same reason Dish, Directv, and others stopped carrying WWE events.
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Hoopalooping this thread to see how Chicos reconciles this with his claim that this would never happen
http://www.nytimes.com/2014/04/24/business/amazon-to-offer-original-hbo-content.html?_r=0
Yes, mostly older shows (although not entirely, some new stuff too). But I think this is just the beginning. This model will take off.
Now I hope the weather sucks this summer.
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Bye bye Aereo. Supreme Court rules against. You can't just steal stuff.
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It's over. "We did try, but it's over now"
http://www.deadline.com/2014/06/aereo-stock-prices-broadcasters-supreme-court/
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Jus. Breyer basically laid the groundwork for a simple workaround.
"We believe that resolution of questions about cloud computing, remote storage DVRs and other novel matters not now before us should await a case in which they are clearly presented," Justice Stephen Breyer wrote.
Somebody is going to package a device that has an antenna, hard drive, and ethernet link all built in, basically a DVR on steroids. The difference is that most every cable subscriber has something like this already, not all are accessible on your devices. So if the broadcasters go after "Aereo Jr.", they're also going to have to go after all of their distributors.
My guess is that ATV is only a generation or two from being able to pull and cloud OTA signals that you can access anywhere.
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Jus. Breyer basically laid the groundwork for a simple workaround.
"We believe that resolution of questions about cloud computing, remote storage DVRs and other novel matters not now before us should await a case in which they are clearly presented," Justice Stephen Breyer wrote.
Somebody is going to package a device that has an antenna, hard drive, and ethernet link all built in, basically a DVR on steroids. The difference is that most every cable subscriber has something like this already, not all are accessible on your devices. So if the broadcasters go after "Aereo Jr.", they're also going to have to go after all of their distributors.
My guess is that ATV is only a generation or two from being able to pull and cloud OTA signals that you can access anywhere.
Ain't about the pipes. The ruling still gets down to content. Problem was, Aereo offered a "cheap" solution by essentially stealing (not paying the content providers) for their copyrighted content. That's what this and the future is all about. Cloud DVR, how it is delivered, etc, that will change...technology isn't the issue. Disney, NewsCorp, CBS, etc want to be paid. The reason they don't go after all the distributors is because all the distributors are paying for those rights. All Aereo had to do was compensate the content creators, of course to do that means they couldn't offer a product like this because it costs money, lots of money, for content.
As mentioned here months ago, I was pretty certain this was going to be how SCOTUS ruled today. Surprised to see Scalia, Thomas and Alito in the dissent, but even reading their dissent they were not crazy about the copyright infringement going on.
If people want cheaper television or video, my mantra continues. You need to crack the code with those that make the content and sell it at such a high cost. The source product is very expensive, very very expensive. Solve that issue, and video becomes cheaper. Delivery mechanism isn't the issue, it is content cost.
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5 industries that millennials are destroying
There’s a lot to be said for watching demographic shifts as you craft your long-term investing strategy.
And while Baby Boomer stocks like health care and insurance get a lot of attention, long-term investors should also consider the impact Millennials will have on businesses — and their portfolios.
There are about 80 million Americans who were born between 1980 and 1995. And while much has been made about the challenges for Millennials to get good jobs or contribute to the economy, that is sure to change. As the Boomer population starts its inevitable decline, the power of this age group will grow substantially in the years ahead.
Some of that will be good, as the tech talents of younger Americans are put to work in the economy and as they grow into a powerful consumer class.
But for some stocks, the rise of Millennials is assuredly bad news. Which picks? Well, here are five specific businesses that Millennials are shunning, which could cause a lot of pain for investors over the long-term if current trends continue.
2. Cable TV
It’s unclear where streaming video is headed in the next several years. But it’s clear that the future is likely with Netflix (NFLX) or Google (GOOG) property YouTube and not an old-guard cable company.
Consider that for the first time ever, the number of pay-TV lines in the U.S. fell last year — with a drop of about 250,000 subscriptions over the calendar year. That’s a big number, and a number that seems to be growing at an alarming rate.
Alarming, at least, if you’re a company like Comcast (CMCSA) or Time Warner Cable (TWC).
Part of the problem is “cord cutting” as folks with cable TV find options on Netflix or other streaming providers at a fair price. But increasingly, traditional cable-TV businesses are going to face the big pressure of Millennials and so-called “cord nevers” who haven’t ever had an affinity to cable and see no reason to start anytime soon when so much of their entertainment is consumed via laptop, tablet or smartphone.
Clearly the industry is circling the wagons, with Comcast bidding for Time Warner Cable (TWC). Similarly, AT&T (XNYS:T) is looking to snap up DirecTV (DTV) — not just to bolster its U-Verse pay-TV business but also to help the company transition into a new content delivery company in the Internet age.
There are big pressures ahead for those that can’t evolve with the times. So while investors may like the dividends of some previously reliable telecoms, it’s important not to forget the long-term headwinds for anything related to cable TV.
http://finance.yahoo.com/news/5-industries-millennials-destroying-132117647.html
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Ain't about the pipes. The ruling still gets down to content. Problem was, Aereo offered a "cheap" solution by essentially stealing (not paying the content providers) for their copyrighted content. That's what this and the future is all about. Cloud DVR, how it is delivered, etc, that will change...technology isn't the issue. Disney, NewsCorp, CBS, etc want to be paid. The reason they don't go after all the distributors is because all the distributors are paying for those rights. All Aereo had to do was compensate the content creators, of course to do that means they couldn't offer a product like this because it costs money, lots of money, for content.
As mentioned here months ago, I was pretty certain this was going to be how SCOTUS ruled today. Surprised to see Scalia, Thomas and Alito in the dissent, but even reading their dissent they were not crazy about the copyright infringement going on.
If people want cheaper television or video, my mantra continues. You need to crack the code with those that make the content and sell it at such a high cost. The source product is very expensive, very very expensive. Solve that issue, and video becomes cheaper. Delivery mechanism isn't the issue, it is content cost.
This is more of a general question, asked it earlier in the thread...but the AMOUNT of TV has surely increased the past 15 years, more channels, more content...but hasn't the most dramatic increase of TV content been reality-based programming (which has to be sooooo much cheaper to produce), my best guess, of original programming on TV, take any random day on my fantastic DirecTV setup, 30-40% reality-based? So while all of this ne TV is cheaper to produce, that money has to be going somewhere, I am just curious where.
You have talked about this in the past, yes, some truly expensive TV exists (GoT, live sports, big dramas, big comedies with high salaries)...but all in all, don't tell me Real World/Rules Challenge or Chopped is what drives my bill going up about 5-7% a year.
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Ain't about the pipes. The ruling still gets down to content. Problem was, Aereo offered a "cheap" solution by essentially stealing (not paying the content providers) for their copyrighted content. That's what this and the future is all about. Cloud DVR, how it is delivered, etc, that will change...technology isn't the issue. Disney, NewsCorp, CBS, etc want to be paid. The reason they don't go after all the distributors is because all the distributors are paying for those rights. All Aereo had to do was compensate the content creators, of course to do that means they couldn't offer a product like this because it costs money, lots of money, for content.
As mentioned here months ago, I was pretty certain this was going to be how SCOTUS ruled today. Surprised to see Scalia, Thomas and Alito in the dissent, but even reading their dissent they were not crazy about the copyright infringement going on.
If people want cheaper television or video, my mantra continues. You need to crack the code with those that make the content and sell it at such a high cost. The source product is very expensive, very very expensive. Solve that issue, and video becomes cheaper. Delivery mechanism isn't the issue, it is content cost.
No disagreement here at all. Just all seems very, very weak though. Like a house of cards. A bubble. Similar to sports, how much more money can really be out there?
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5 industries that millennials are destroying
There’s a lot to be said for watching demographic shifts as you craft your long-term investing strategy.
And while Baby Boomer stocks like health care and insurance get a lot of attention, long-term investors should also consider the impact Millennials will have on businesses — and their portfolios.
There are about 80 million Americans who were born between 1980 and 1995. And while much has been made about the challenges for Millennials to get good jobs or contribute to the economy, that is sure to change. As the Boomer population starts its inevitable decline, the power of this age group will grow substantially in the years ahead.
Some of that will be good, as the tech talents of younger Americans are put to work in the economy and as they grow into a powerful consumer class.
But for some stocks, the rise of Millennials is assuredly bad news. Which picks? Well, here are five specific businesses that Millennials are shunning, which could cause a lot of pain for investors over the long-term if current trends continue.
2. Cable TV
It’s unclear where streaming video is headed in the next several years. But it’s clear that the future is likely with Netflix (NFLX) or Google (GOOG) property YouTube and not an old-guard cable company.
Consider that for the first time ever, the number of pay-TV lines in the U.S. fell last year — with a drop of about 250,000 subscriptions over the calendar year. That’s a big number, and a number that seems to be growing at an alarming rate.
Alarming, at least, if you’re a company like Comcast (CMCSA) or Time Warner Cable (TWC).
Part of the problem is “cord cutting” as folks with cable TV find options on Netflix or other streaming providers at a fair price. But increasingly, traditional cable-TV businesses are going to face the big pressure of Millennials and so-called “cord nevers” who haven’t ever had an affinity to cable and see no reason to start anytime soon when so much of their entertainment is consumed via laptop, tablet or smartphone.
Clearly the industry is circling the wagons, with Comcast bidding for Time Warner Cable (TWC). Similarly, AT&T (XNYS:T) is looking to snap up DirecTV (DTV) — not just to bolster its U-Verse pay-TV business but also to help the company transition into a new content delivery company in the Internet age.
There are big pressures ahead for those that can’t evolve with the times. So while investors may like the dividends of some previously reliable telecoms, it’s important not to forget the long-term headwinds for anything related to cable TV.
http://finance.yahoo.com/news/5-industries-millennials-destroying-132117647.html
Number of pay tv subscribers actually up in Q1. For them to say 250,000 is a big number or alarming rate is kind of funny. It's a small number, and as stated, the number actually increased in Q1. Will that happen forever, of course not. But the number of death articles over the years has been quite humorous.
And yes, delivery will change, that's never been the issue. But it ain't coming free like millenials want. Sorry to burst their bubble. They will pay for it one way or another....whether its via pay tv, pay mobile, pay cloud, whatever the pipe delivery mechanism is, it will be paid for.
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And yes, delivery will change, that's never been the issue. But it ain't coming free like millenials want. Sorry to burst their bubble. They will pay for it one way or another....whether its via pay tv, pay mobile, pay cloud, whatever the pipe delivery mechanism is, it will be paid for.
Making up an argument to argue against yourself again.
I have never heard any "millenials" say they want cable content for free. Hard to take anything you say seriously when you make such silly statements.
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Number of pay tv subscribers actually up in Q1. For them to say 250,000 is a big number or alarming rate is kind of funny. It's a small number, and as stated, the number actually increased in Q1. Will that happen forever, of course not. But the number of death articles over the years has been quite humorous.
And yes, delivery will change, that's never been the issue. But it ain't coming free like millenials want. Sorry to burst their bubble. They will pay for it one way or another....whether its via pay tv, pay mobile, pay cloud, whatever the pipe delivery mechanism is, it will be paid for.
Most millennials don't have a problem paying 1.09 for a song on iTunes. But if they're forced to buy the entire album, they will seek an alternative path.
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This is more of a general question, asked it earlier in the thread...but the AMOUNT of TV has surely increased the past 15 years, more channels, more content...but hasn't the most dramatic increase of TV content been reality-based programming (which has to be sooooo much cheaper to produce), my best guess, of original programming on TV, take any random day on my fantastic DirecTV setup, 30-40% reality-based? So while all of this ne TV is cheaper to produce, that money has to be going somewhere, I am just curious where.
You have talked about this in the past, yes, some truly expensive TV exists (GoT, live sports, big dramas, big comedies with high salaries)...but all in all, don't tell me Real World/Rules Challenge or Chopped is what drives my bill going up about 5-7% a year.
I don't know the percentage, but of course everyone is looking to cut costs and reality programming was one way to do it. People don't want to admit it, but they also watch the stuff in droves. But the cost of reality programming has also gone up a lot, because everyone is trying to out perform the next guy.
I know our programming costs go up 8% to 10% per year, mostly because there are escalators built into contracts. Added features like apps, new technology costs money like HD, 4K, 3D, new encoding, streaming capabilities, etc. Customers want all this stuff, it costs money. All new contracts, those are wonderful and they come usually with huge resets. What is passed on to consumers has been 4% to 6% on average, so margins actually shrinking in some cases. Some cable providers have hit customers with an 8% to 10% increase each year to fully cover their costs, we haven't. Your local channels....I have seen increases at 500% percent asked for in one year by channels. I remember years ago having to pay $0.05 for a broadcast network are now over $1.00 per, that's a 2000% increase in a decade. Those costs are passed on. Lots of actors, directors, producers, writers, camera guys, sound guys, editing guys, unions, ad sales market tanking, etc, that those guys are charging for.
Sports rights are the most expensive, but nothing is cheap when it comes to video in comparison to other forms of entertainment.
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I don't know the percentage, but of course everyone is looking to cut costs and reality programming was one way to do it. People don't want to admit it, but they also watch the stuff in droves. But the cost of reality programming has also gone up a lot, because everyone is trying to out perform the next guy.
I know our programming costs go up 8% to 10% per year, mostly because there are escalators built into contracts. Added features like apps, new technology costs money like HD, 4K, 3D, new encoding, streaming capabilities, etc. Customers want all this stuff, it costs money. All new contracts, those are wonderful and they come usually with huge resets. What is passed on to consumers has been 4% to 6% on average, so margins actually shrinking in some cases. Some cable providers have hit customers with an 8% to 10% increase each year to fully cover their costs, we haven't. Your local channels....I have seen increases at 500% percent asked for in one year by channels. I remember years ago having to pay $0.05 for a broadcast network are now over $1.00 per, that's a 2000% increase in a decade. Those costs are passed on. Lots of actors, directors, producers, writers, camera guys, sound guys, editing guys, unions, ad sales market tanking, etc, that those guys are charging for.
Sports rights are the most expensive, but nothing is cheap when it comes to video in comparison to other forms of entertainment.
Thanks for the insight, very appreciated. Hope to re-sign with DTV when my contract is up in a month, but have to weigh some other options before reupping.
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Making up an argument to argue against yourself again.
I have never heard any "millenials" say they want cable content for free. Hard to take anything you say seriously when you make such silly statements.
I have studies after studies that suggest otherwise. I'm not making up anything Brandx. Stop on by, can show you about 500 pages of data if you wish. It's not a silly statement at all. It is the number one justification millenials and young millenials give for stealing stuff on Bit Torrent and sharing passwords on Netflix, HBO Go, etc. I have two separate surveys done on that, both by independent groups.
Literally hundreds of pages of research and feelings about what should be charged and what shouldn't. Now, do all millenials think this way? Of course not. Do a scary number? Yes. Do a scary number think it is wrong to go steal a car, but perfectly fine to steal something else because they think it is a victimless crime? Yup.
Here's a random few from the latest. I love the argument the airwaves are free, especially when this guy thinks the "airwaves" apply to a non broadcaster like HBO. Wow, I weep for the future sometimes.
Q: "Do you feel watching Game of Thrones on Bit Torrent is stealing?"
A: No
Q: Why or why not?
A: Because it should be free. The airwaves are free for the people
Different millenial
Q: Do you pay for Netflix service?
A: No
Q: Do you use Netflix service?
A: Yes
Q: If you are not paying for it, how are you using it?
A: My friends and I share the account and only one pays for it
Q: Do you feel that is stealing? Why or Why Not?
A: No. They make enough money already and we are paying for it. It's not my fault they don't limit who can use it
Q: Do you help to pay for the service with your friends?
A: No.
Interesting times.
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A bit mis-leading ain't it? You make up that 'margin' on the fees charged for extra boxes, High Definition fees or as you now call them 'Advanced equipment'
I know our programming costs go up 8% to 10% per year, mostly because there are escalators built into contracts. Added features like apps, new technology costs money like HD, 4K, 3D, new encoding, streaming capabilities, etc. Customers want all this stuff, it costs money. All new contracts, those are wonderful and they come usually with huge resets. What is passed on to consumers has been 4% to 6% on average, so margins actually shrinking in some cases. Lots of actors, directors, producers, writers, camera guys, sound guys, editing guys, unions, ad sales market tanking, etc, that those guys are charging for.
or as Reinko put it, how much does it really cost and how many actually watch shows like "Searching for Sasquatch"?
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I'm not sure I buy that they say they should get it for free. That's a bit like saying I should be able to get away with crime.
I think the problem is that they don't see it as a crime in the first place. In fact, most have probably gone their entire lives without any moral education whatsoever.
Edit: In other words, there's no difference between paying for something if a legal purchase is a requirement of consumption and downloading it for free if there is no other obstacle to consumption.
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Making up an argument to argue against yourself again.
I have never heard any "millenials" say they want cable content for free. Hard to take anything you say seriously when you make such silly statements.
As usual.
Most millennials don't have a problem paying 1.09 for a song on iTunes. But if they're forced to buy the entire album, they will seek an alternative path.
Yep. A la carte means "pay for what I want," not "give it to me for free."
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I have studies after studies that suggest otherwise. I'm not making up anything Brandx. Stop on by, can show you about 500 pages of data if you wish. It's not a silly statement at all. It is the number one justification millenials and young millenials give for stealing stuff on Bit Torrent and sharing passwords on Netflix, HBO Go, etc. I have two separate surveys done on that, both by independent groups.
Literally hundreds of pages of research and feelings about what should be charged and what shouldn't. Now, do all millenials think this way? Of course not. Do a scary number? Yes. Do a scary number think it is wrong to go steal a car, but perfectly fine to steal something else because they think it is a victimless crime? Yup.
Here's a random few from the latest. I love the argument the airwaves are free, especially when this guy thinks the "airwaves" apply to a non broadcaster like HBO. Wow, I weep for the future sometimes.
Q: "Do you feel watching Game of Thrones on Bit Torrent is stealing?"
A: No
Q: Why or why not?
A: Because it should be free. The airwaves are free for the people
Different millenial
Q: Do you pay for Netflix service?
A: No
Q: Do you use Netflix service?
A: Yes
Q: If you are not paying for it, how are you using it?
A: My friends and I share the account and only one pays for it
Q: Do you feel that is stealing? Why or Why Not?
A: No. They make enough money already and we are paying for it. It's not my fault they don't limit who can use it
Q: Do you help to pay for the service with your friends?
A: No.
Interesting times.
reads like a Jay Walking bit on the Tonight Show, i.e. cleverly edited to make a point
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Q: "Do you feel watching Game of Thrones on Bit Torrent is stealing?"
A: No
Q: Why or why not?
A: Because it should be free. The airwaves are free for the people
Congratulations, you found the one nut job in your 500 pages of data. That is random ::)
Different millenial
Q: Do you pay for Netflix service?
A: No
Q: Do you use Netflix service?
A: Yes
Q: If you are not paying for it, how are you using it?
A: My friends and I share the account and only one pays for it
Q: Do you feel that is stealing? Why or Why Not?
A: No. They make enough money already and we are paying for it. It's not my fault they don't limit who can use it
Q: Do you help to pay for the service with your friends?
A: No.
Not sure why you cite this... Netflix and HBO have already acknowledge - and embraced - this phenomenon.
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A bit mis-leading ain't it? You make up that 'margin' on the fees charged for extra boxes, High Definition fees or as you now call them 'Advanced equipment'
or as Reinko put it, how much does it really cost and how many actually watch shows like "Searching for Sasquatch"?
You can make it up elsewhere, but I don't think it is misleading. You either introduce new services to sell, like home security and such. You try to claw back cost increases by raising prices that directly impact those costs, which right now that can't be done at the rate programming costs are going up, or yes you can try to increase costs elsewhere. The other challenge is with a large cohort of customers and a wide range of services, you actually make no money on some, some money on others, etc. It's all over the board, so price increases are difficult to pass through because everyone gets the programming, not everyone has a DVR, or HD, or MRV, etc.
Nothing is incorrect about the statement that programming costs go up 8% to 10% a year, and those are found on the record. Nor are the 4% to 6% price increases, also on the record for the FCC, SEC, consumer groups, etc to see. Content costs this year alone, over $10 billion. Single largest cost.
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I'm not sure I buy that they say they should get it for free. That's a bit like saying I should be able to get away with crime.
I think the problem is that they don't see it as a crime in the first place. In fact, most have probably gone their entire lives without any moral education whatsoever.
Edit: In other words, there's no difference between paying for something if a legal purchase is a requirement of consumption and downloading it for free if there is no other obstacle to consumption.
I agree, but that's one of the problems. If you read some of their answers, they are absolutely saying they should get away with a crime. Why? Because they don't view it as a crime as you mentioned. Some of these folks don't pause one second to think watching something on Bit Torrent is a crime, not one nanosecond, but that doesn't make it so.
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nm
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Yep. A la carte means "pay for what I want," not "give it to me for free."
+1000
This is the argument many of us have made here - over and over again.
We are completely willing to pay for content that we want. We have a problem being forced to pay for content we do not want.
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+1000
This is the argument many of us have made here - over and over again.
We are completely willing to pay for content that we want. We have a problem being forced to pay for content we do not want.
I have an antenna, Netflix, Hulu Plus, and Amazon Prime (all paid). Give me HBO GO for the same price as those, as well as FS1 streaming for games (or even PPV for MU games) and I'm all set. Right now HBO and FS1 get zero dollars from me. They could be getting ~$100/year each. Their loss.
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Congratulations, you found the one nut job in your 500 pages of data. That is random ::)
Not sure why you cite this... Netflix and HBO have already acknowledge - and embraced - this phenomenon.
Actually, not one nutjob. There are countless answers like this by many folks that if the demo, that was the point. The examples I gave were of two different people. I can open these binders up and come up with 100's of other examples.
HBO's CEO has said it isn't a big deal, the day to day people I have to deal with that are actually responsible for numbers don't agree with their CEO. That is also why they are changing their college marketing and college operation where HBO is offered. A major test going on this Fall as a result. Should be interesting to say the least.
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+1000
This is the argument many of us have made here - over and over again.
We are completely willing to pay for content that we want. We have a problem being forced to pay for content we do not want.
Understood. Talk to Disney, Newscorp, CBS, etc. That's where the issue resides. I'm curious, do you hate it when you buy Marquette tickets that some of the money is going to the men's soccer team or women's tennis team? Perhaps you don't, as a MU alum. For a person in Milwaukee that isn't an alum, only wants the help the basketball program should he\she be upset that some of the money is supporting something he doesn't want?
I hate that my taxes are being spent on things I don't want to support. I want an OS on my computer that does only X, Y and Z, not A, B and C. I get your argument and I support it, but this happens in the world all the time with products and services across the spectrum. Petition those that force it, those that create it. Their answer will be simple. You only want ESPN, ok...$20 a month for ESPN only.
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I have an antenna, Netflix, Hulu Plus, and Amazon Prime (all paid). Give me HBO GO for the same price as those, as well as FS1 streaming for games (or even PPV for MU games) and I'm all set. Right now HBO and FS1 get zero dollars from me. They could be getting ~$100/year each. Their loss.
Also close to that boat. A way for FS1 to get to me and I would never watch regular television. I'm paying to have something I use for maybe an hour per month seven months out of the year, probably would be year round if FS1 didn't have crummy distribution. Had a family member rant about the same thing to me when she called to cancel cable and they completely missed the point (cost) in trying to dissuade her - offered to add more channels and some feature on her home phone...she said she didn't want to hear about getting 200 more channels; if she had 10,000 channels she would still only watch the same two and there is no need to add features to an obsolete home phone.
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Also close to that boat. A way for FS1 to get to me and I would never watch regular television. I'm paying to have something I use for maybe an hour per month seven months out of the year, probably would be year round if FS1 didn't have crummy distribution. Had a family member rant about the same thing to me when she called to cancel cable and they completely missed the point (cost) in trying to dissuade her - offered to add more channels and some feature on her home phone...she said she didn't want to hear about getting 200 more channels; if she had 10,000 channels she would still only watch the same two and there is no need to add features to an obsolete home phone.
Thanks for quoting Jujuman otherwise I never would have seen it. Sure, FS1 is getting zero dollars from Jujuman. Problem is, if they sold it direct like he wants, they would pick up his dollars and lose 50% to 70% of all the other dollars they get from everyone else. They aren't stupid which is why they aren't going to do that. They can't offer to set it to JuJuman direct and require everyone else to buy it in a bundle. So they're going for the larger buy, obviously. They aren't going to give up their dollars for dimes, not anytime soon at least. They know the second they offer it direct, every single distributor has the ability to sell it that way as well, which means they immediately lose tons of viewers and tons of subscribers. It's why they don't do it, because they cannot afford to. All their rights are based on that large number of subscribers, which helps to pay the Big East, which helps to fund the MU athletic department.
Would love for it to happen, but right now it isn't allowed. Maybe this lawsuit will change things. http://arstechnica.com/tech-policy/2014/06/cablevision-bid-to-end-viacoms-forced-channel-bundling-survives-challenge/
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I agree, but that's one of the problems. If you read some of their answers, they are absolutely saying they should get away with a crime. Why? Because they don't view it as a crime as you mentioned. Some of these folks don't pause one second to think watching something on Bit Torrent is a crime, not one nanosecond, but that doesn't make it so.
Maybe that's because many of us don't think the show is worth paying much for but don't mind taking a chance on it if its free to check out. I only watch Game of Thrones because I can download it(BT), if the only way to see current episodes is to subscribe to HBO I will pass on seeing it until I can rent the blu-rays instead. IOW, many people do BT shows like that only because its possible but they wouldn't watch it at all if BT wasn't possible = HBO not really losing those subscribers to BT since they would never watch it otherwise.
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Maybe that's because many of us don't think the show is worth paying much for but don't mind taking a chance on it if its free to check out. I only watch Game of Thrones because I can download it(BT), if the only way to see current episodes is to subscribe to HBO I will pass on seeing it until I can rent the blu-rays instead. IOW, many people do BT shows like that only because its possible but they wouldn't watch it at all if BT wasn't possible = HBO not really losing those subscribers to BT since they would never watch it otherwise.
Doesn't justify it, stealing is stealing. You can rationalize it all you want, but if you watch it via BT, you aren't paying them subscriber fees or DVD sales. Not a victimless crime. The rationalization you mention is similar to the studies I've seen. They feel if it isn't something like a car, a computer, an iphone, or something tangible, it's not really stealing. "It's just data". That's where we are as a society. Fortunately there is some very good work being done on the law enforcement side that will finally be helping. One of the rare instances that the left actually cares about "petty criminal" behavior because it's costing their buddies in Hollywood a ton of money, and that includes down to the rank and file union guy that is a sound person, camera guy, lighting guy, etc. Yes, things do trickle down.
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Doesn't justify it, stealing is stealing. You can rationalize it all you want, but if you watch it via BT, you aren't paying them subscriber fees or DVD sales. Not a victimless crime. The rationalization you mention is similar to the studies I've seen. They feel if it isn't something like a car, a computer, an iphone, or something tangible, it's not really stealing. "It's just data". That's where we are as a society. Fortunately there is some very good work being done on the law enforcement side that will finally be helping. One of the rare instances that the left actually cares about "petty criminal" behavior because it's costing their buddies in Hollywood a ton of money, and that includes down to the rank and file union guy that is a sound person, camera guy, lighting guy, etc. Yes, things do trickle down.
I agree with you on this, but could you turn down the political rhetoric for 5min? It doesn't really help you make your point here.
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I agree with you on this, but could you turn down the political rhetoric for 5min? It doesn't really help you make your point here.
As a cord cutter who despises the cable and satellite companies, I can only pray that Chicos finds himself working at Jack-In-The-Box sometime soon. But sadly, Chicos is correct... those supporting the producers and distributors in Congress (counter-intuitively) are doing so only because they know who butters their bread, not because they think it's good for the consumer. Unfortunately, that leaves the consumer with no ally in DC to fight the fight against big TV.
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...those supporting the producers and distributors top of any industry in Congress (counter-intuitively) are doing so only because they know who butters their bread, not because they think it's good for the consumer. Unfortunately, that leaves the consumer with no ally in DC to fight the fight against big TV anything.
FTFY
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As a cord cutter who despises the cable and satellite companies, I can only pray that Chicos finds himself working at Jack-In-The-Box sometime soon. But sadly, Chicos is correct... those supporting the producers and distributors in Congress (counter-intuitively) are doing so only because they know who butters their bread, not because they think it's good for the consumer. Unfortunately, that leaves the consumer with no ally in DC to fight the fight against big TV.
Welcome to libertarianism. This is exactly why I think regulation almost never does anything except help rent-seekers maintain monopolies.
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FTFY
Understood and agreed. I was merely attempting to stay on topic.
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As a cord cutter who despises the cable and satellite companies, I can only pray that Chicos finds himself working at Jack-In-The-Box sometime soon. But sadly, Chicos is correct... those supporting the producers and distributors in Congress (counter-intuitively) are doing so only because they know who butters their bread, not because they think it's good for the consumer. Unfortunately, that leaves the consumer with no ally in DC to fight the fight against big TV.
I wouldn't wish that on anyone. I wouldn't wish for anyone to lose their job, their health, etc. To each their own.
Creating good content costs lots of money. Stuff isn't free or cheap, not the quality stuff anyway. It isn't a widget.
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Welcome to libertarianism. This is exactly why I think regulation almost never does anything except help rent-seekers maintain monopolies.
Except for the elephant in the room.
Libertarians ALSO need millions of $$$$ to get in office. They are human and they WILL also chase the $$$$$.
Not a political statement - just a facts of life statement.
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I wouldn't wish that on anyone. I wouldn't wish for anyone to lose their job, their health, etc. To each their own.
Creating good content costs lots of money. Stuff isn't free or cheap, not the quality stuff anyway. It isn't a widget.
Corporate office, Chicos; not the deep fryer. You'll be better off in the long run.
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Corporate office, Chicos; not the deep fryer. You'll be better off in the long run.
I worked the fryer at McDonalds when I was 16. Have some good friends in Chicago working at McDonald's corporate, been offered a few times but said no.
As I mentioned here a few weeks ago, my new gig is actually something you would be happy about. Trying like the dickens to get something for cord nevers and cord cutters. A low cost video package for those folks. The complexity is convincing the content creators they should do this without jeopardizing their revenue streams they need to create and\or purchase (sports rights) new content. A grand challenge that Apple, Google, Intel and others have failed in. We'll see how it goes, but a tough slog to be sure. If it does happen, then you might throw an atta boy out there. ;)
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I worked the fryer at McDonalds when I was 16. Have some good friends in Chicago working at McDonald's corporate, been offered a few times but said no.
As I mentioned here a few weeks ago, my new gig is actually something you would be happy about. Trying like the dickens to get something for cord nevers and cord cutters. A low cost video package for those folks. The complexity is convincing the content creators they should do this without jeopardizing their revenue streams they need to create and\or purchase (sports rights) new content. A grand challenge that Apple, Google, Intel and others have failed in. We'll see how it goes, but a tough slog to be sure. If it does happen, then you might throw an atta boy out there. ;)
Holy crapola.... it took several years, but it looks like we finally got through to Chicos. Atta boy, Scoop.
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Like I said 12 months ago, you're going to see major consolidation
http://dealbook.nytimes.com/2014/07/16/rupert-murdoch-said-to-have-made-offer-for-time-warner/?_php=true&_type=blogs&_r=0
This one is dead right now, but don't count it out or don't count others from happening. Tis the way of the world in this industry right now.
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Verizon is finally ready to acknowledge that cable TV just isn't working for a lot of us anymore.
The company is planning to launch its Internet-based TV service that can be watched on mobile devices in the "late first half of 2015," Lowell McAdam, Verizon's CEO, said on Thursday. It's unclear what exactly the service would look like, but McAdam said it would offer "a la carte" options, rather than being bundled like expensive cable packages are now.
Think Netflix, but with live streaming. McAdam said at the conference that the service would include programming from "the big four" networks -- CBS, ABC, NBC and Fox.
"No one wants to have 300 channels on your wireless device," he said. Greg Ireland, a research manager at IDC, the technology research firm, said Verizon's offering could borrow ideas from services like Netflix or Amazon Instant Video, which offer interactive menus and will remember where you are in a program, regardless of what device you started watching it on.
Verizon's move comes as the TV industry is set to undergo a massive shift. The rise of streaming services like Netflix, Amazon Prime Instant Video and Hulu, which for a flat fee offer on-demand viewing of movies, TV shows and original programming, pose a threat to traditional "linear" cable and satellite. An increasing number of people -- especially young people, a highly coveted demographic for advertisers -- are cutting the pay TV cord and opting for streaming services over expensive cable or satellite packages. According to a report this spring from Experian Marketing Services , nearly a quarter of young adults between 18 and 34 who subscribe to Hulu or Netflix don't pay for TV.
Experian also said that the number of cord-cutting homes has increased dramatically in just three years, from 5.1 million homes in 2010 to 7.6 million homes in 2013.
Pay TV subscriptions have been flat or declining slightly, while Netflix continues to grow at a rapid clip. Netflix ended the June quarter with 36.24 million members in the U.S., up from 29.81 million at the same time last year.
About 100 million households in the U.S. pay for traditional TV.
It's unclear what exactly Verizon's product would look like. But to get an idea, said IDC's Ireland, it could be helpful to look to what Dish is working on. The company is developing a service that would allow you to watch live TV on multiple devices, but not require a cable box.
"[It could be] a service that offers fewer channels at a smaller price point, targeting a piece of the market that may not now be pay TV subscribers," Ireland said of Verizon's new product. Such a service would "appeal to those outside of the pay TV universe today and get them back into that universe."
Verizon's Internet TV product will incorporate technology from Intel's OnCue, which Verizon announced it would buy from the chip maker in January. Intel previously planned to launch its own TV product by the end of last year, but ran into oppositionfrom cable and satellite companies, which make tons of money from expensive bundles.
Verizon's McAdam told investors that much of the technology is in place for the network. Now, the company is negotiating with content providers, which in the last two years have become much more receptive to delivering programming in different ways.
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Holy crapola.... it took several years, but it looks like we finally got through to Chicos. Atta boy, Scoop.
It's been a crazy few months with the new gig. My beliefs haven't changed, however, in fact they are hardened in many cases. I said in the past you will see packages get smaller and the pipes will change, but I believe a la carte is so far down the road (though I said in the past if someone could do it would be HBO, but at great cost to them).
In dealing with the programmers daily, they have no desire to break the bundle and that remains the key as I stated the last few years. Until they change, things aren't going to change dramatically. It has to be a financial winner for them. Which means one either pays a ton for an individual channel or slightly more for many. Same thing I've been saying for years. You only want 10 channels, well the content owners are going to say pay $65 for that 10 channels or pay us $90 and get 100 channels. You decide....your cost per unit will be radically different, and not truly "a la carte"
Verizon made a comment last week about their new OTT service...this is the space that I now co-lead. The pipes are changing, obviously. Verizon talks of a la carte offerings. I'll believe it when I see it because none of the conglomerates are allowing it (Disney,NewsCorp, Viacom, A&E, CBS, Comcast\Universal, etc). Their CEO may have thrown that out just to get people excited, but the content producers aren't budging.
What you will see is some streaming services actually stream television networks in smaller packages. That will catch on for those strapped for cash. How good of a product it actually is (quality, number of streams, etc) remains to be seen...remember, I'm not talking SVOD, but streaming linear over IP. There are also subscriber caps that the conglomerates put in to protect their revenue streams, meaning only a limited number of people can sign up before they stop selling it. This will be popular in MDUs, college campuses, low income, etc.
Fun times...crazy times....same hurdles....those that own the content.
http://www.fool.com/investing/general/2014/09/17/verizon-is-determined-to-make-a-la-carte-cable-a-r.aspx
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Found an interesting commentary on the DOJ, antitrust laws and the TWC/Comcast merger:
"For one, we're talking about different antitrust issues. Broadly speaking, the antitrust laws prohibit (1) concerted action that harms competition, like price fixing cartels; (2) unilateral action by a monopolist that harms competition; and (3) mergers and acquisitions that significantly diminish competition.
Microsoft was alleged to have used its position as a monopolist to undermine competition. That's (2) above. Typically, monopolization entails an element of foulplay. Achieving or maintaining a monopoly through normal, reasonable business practices is not illegal.
Comcast and TWC are proposing to merge. That's (3) above. When evaluating a merger, the DOJ looks at whether the companies directly compete in any markets, and whether the merger is likely to reduce competition in those markets.
Comcast and TWC claim that they do not directly compete. That's true, but there's more to the story. Comcast and TWC will point out that cable systems are "natural monopolies" -- it costs a lot to lay cable, and where one company has already laid cable in a given area, it enjoys a huge cost advantage over other would-be competitors, who would have to lay their own cable to compete.
But on the other hand, Comcast and its rivals have also done some dubious stuff in the past that has led to the current competitive landscape. For example, Comcast, TWC, and others have engaged in a number of anticompetitive deals, such as geographic market allocation and customer swapping, to create large regional monopolies. These deals themselves arguably violate the antitrust laws -- see (1) above -- and indeed are the subject of ongoing litigation. But unfortunately, the DOJ most likely would not take this background into account when evaluating the likely effect of the merger on competition.
So when Comcast and TWC say that the merger will not reduce competition because they do not currently compete, that is in part due to the fact that they have already agreed not to compete. It's like two members of a price fixing cartel saying that merging would not reduce competition because, hey, they aren't competing anyway.
We don't know yet whether the DOJ will challenge the merger. The Obama DOJ has been decent in this area; they challenged the AT&T/T-Mobile merger and US Air/American Airlines merger. But neither of those cases played out -- the FCC killed AT&T/T-Mobile, and the DOJ caved once politicians began pressuring the agency to let US Air/American Airlines go through.
Given that Comcast is so well connected in Washington, and in light of the potential difficulties in establishing that the merger will actually reduce competition, I expect that the DOJ will approve the Comcast/TWC merger, subject to certain concessions.
Politics is a core issue when it comes to antitrust enforcement. In fact, I don't think the Obama DOJ would sue Microsoft today. Clinton's DOJ was a bit more aggressive in this area."
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Time Warner adding more fees. The $8.00 per month modem "lease" fee kills me.
http://www.jsonline.com/business/time-warner-cable-adding-fee-for-sports-programming-b99419919z1-287524741.html
If you haven't taken the time and hassle to buy your own modem and set it up, this might be the incentive to do so. I bought my own modem a couple of years ago. The fee isn't a big deal, but for the 8 year old modem I had from Time Warner, it was such a hugh rip off, that I refused to pay Time Warner. They continue to prove that they will take advantage of their customers as often and in any way that you allow them to :D
At some point, as the costs continue to escalate, the cable cutting has to increase. But Americans love their live sports, I guess. And paying for a leased modem, I guess.
I don't have cable TV, but with all of the taxes and fees (DVR, Modem, Remotes, Sports) I wonder what just the fees and taxes total, versus the actual price of the package.
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Time Warner adding more fees. The $8.00 per month modem "lease" fee kills me.
http://www.jsonline.com/business/time-warner-cable-adding-fee-for-sports-programming-b99419919z1-287524741.html
If you haven't taken the time and hassle to buy your own modem and set it up, this might be the incentive to do so. I bought my own modem a couple of years ago. The fee isn't a big deal, but for the 8 year old modem I had from Time Warner, it was such a hugh rip off, that I refused to pay Time Warner. They continue to prove that they will take advantage of their customers as often and in any way that you allow them to :D
At some point, as the costs continue to escalate, the cable cutting has to increase. But Americans love their live sports, I guess. And paying for a leased modem, I guess.
I don't have cable TV, but with all of the taxes and fees (DVR, Modem, Remotes, Sports) I wonder what just the fees and taxes total, versus the actual price of the package.
Yup. Comcast just increased theirs too. It is now a $10 per month fee for me. My overall monthly rate went up about $6.
It pisses me off they increased my monthly rate with them just 3 months after switching over to them from RCN. I thought you were guaranteed that rate for a year. Annual increases are part of the deal but 3 months? I called and complained, and they refused to lower it, but threw me 3 months of Starz/Showtime for free.
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A la carte has arrived
http://www.businessinsider.com/dish-internet-based-tv-includes-espn-2015-1
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I found this to be interesting. Pretty decent offer from Dish. I cancelled cable a few months ago but recently re-subscribed because I missed MU Hoops and NFL games. I do think this will eventually be the future of cable service, more of an a la carte model.
http://www.cnbc.com/id/102310691
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A la carte has arrived
http://www.businessinsider.com/dish-internet-based-tv-includes-espn-2015-1
beat me to it >:(
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The sling tv is interesting. Not a replacement for true cable lovers, but for those who just want a few channels or a few channels to go along with their antenna, this could work.
If I could get fox sports 1 for $15 or $20 a month, I'd pay for it. Everything else I can do without.
I noticed on Apple TV that CBS now offers all of their main shows for free, on demand, without cable verification. The only catch is that the programs are a week old.
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A la carte has arrived
http://www.businessinsider.com/dish-internet-based-tv-includes-espn-2015-1
Nope.
It's not a la carte AND the Disney deal limits how many they subscriptions they can sell. There is a cap....I spoke about this months ago.
But from a cost perspective, yes you're basically paying $20 for one channel (to be accurate, about $19 for one and about $1.00 for the rest). Which I also said months and years ago to just get ESPN you're going to have to pay anywhere from 3x to 5x what the current going rate is....I was exactly right. It's pure economics gents. ESPN (Disney), isn't going to give up the $6 they get today from MVPDS when 90% of people MUST take it. So if it goes a la carte (or even hybrid like this one), they're going to have to get 3x or 4x to make up the difference. AND, they are going to cap it, as I stated, to prevent any downstream erosion. These people aren't stupid.
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Time Warner adding more fees. The $8.00 per month modem "lease" fee kills me.
http://www.jsonline.com/business/time-warner-cable-adding-fee-for-sports-programming-b99419919z1-287524741.html
If you haven't taken the time and hassle to buy your own modem and set it up, this might be the incentive to do so. I bought my own modem a couple of years ago. The fee isn't a big deal, but for the 8 year old modem I had from Time Warner, it was such a hugh rip off, that I refused to pay Time Warner. They continue to prove that they will take advantage of their customers as often and in any way that you allow them to :D
At some point, as the costs continue to escalate, the cable cutting has to increase. But Americans love their live sports, I guess. And paying for a leased modem, I guess.
I don't have cable TV, but with all of the taxes and fees (DVR, Modem, Remotes, Sports) I wonder what just the fees and taxes total, versus the actual price of the package.
Everyone's programming costs went up about 8% to 10%, those companies are trying to recoup those expenses. NFL costs money. MLB costs money. Big Bang Theory costs money. So on and so forth.
The reason they are taking up the costs on those other items is a bucketing exercise more than anything. They are trying not to burden the costs as much on programming, even though that's where their expense like is getting jacked, so they raise DVR fees, or modem fees, or technology fees, or mirroring fees, or box fees. That's all it is. That's how that game is played.
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Nope.
It's not a la carte AND the Disney deal limits how many they subscriptions they can sell. There is a cap....I spoke about this months ago.
But from a cost perspective, yes you're basically paying $20 for one channel (to be accurate, about $19 for one and about $1.00 for the rest). Which I also said months and years ago to just get ESPN you're going to have to pay anywhere from 3x to 5x what the current going rate is....I was exactly right. It's pure economics gents. ESPN (Disney), isn't going to give up the $6 they get today from MVPDS when 90% of people MUST take it. So if it goes a la carte (or even hybrid like this one), they're going to have to get 3x or 4x to make up the difference. AND, they are going to cap it, as I stated, to prevent any downstream erosion. These people aren't stupid.
Nope what? How is it not a la carte? Fewer channels, lower total cost...
I think everyone with half a brain recognizes you are going to pay more per channel with this type of system. But for some people, that is still worth it.
I think we all see what is coming, and it is more of this.
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Nope.
It's not a la carte AND the Disney deal limits how many they subscriptions they can sell. There is a cap....I spoke about this months ago.
But from a cost perspective, yes you're basically paying $20 for one channel (to be accurate, about $19 for one and about $1.00 for the rest). Which I also said months and years ago to just get ESPN you're going to have to pay anywhere from 3x to 5x what the current going rate is....I was exactly right. It's pure economics gents. ESPN (Disney), isn't going to give up the $6 they get today from MVPDS when 90% of people MUST take it. So if it goes a la carte (or even hybrid like this one), they're going to have to get 3x or 4x to make up the difference. AND, they are going to cap it, as I stated, to prevent any downstream erosion. These people aren't stupid.
You're mixing together a lot of stuff.
ESPN is offering an ala Cart option. Period.
It's not cheap, but it is a legit option. Period.
In the future, I don't think our cost per channel is going to go down (as you have correctly stated, bundling creates efficiency), but if I only watch 2 or 3 channels, I might be able to do it for $30 or $40 instead of $110 for 200 channels I don't watch.
To put it another way, I know if I buy a pallet of eggs, my cost per egg will drop to $.02 per egg... but I only eat 3 or 4 eggs per week, so I'm better off paying $3 per egg.
Television doesn't spoil like food, but my time is limited, so it's not like I can magically create more viewing opportunities to consume more television to get more value. I'm probably better off purchasing the amount of television content I actually use.
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You're mixing together a lot of stuff.
ESPN is offering an ala Cart option. Period.
It's not cheap, but it is a legit option. Period.
In the future, I don't think our cost per channel is going to go down (as you have correctly stated, bundling creates efficiency), but if I only watch 2 or 3 channels, I might be able to do it for $30 or $40 instead of $110 for 200 channels I don't watch.
To put it another way, I know if I buy a pallet of eggs, my cost per egg will drop to $.02 per egg... but I only eat 3 or 4 eggs per week, so I'm better off paying $3 per egg.
Television doesn't spoil like food, but my time is limited, so it's not like I can magically create more viewing opportunities to consume more television to get more value. I'm probably better off purchasing the amount of television content I actually use.
Nope, ESPN is not offering a la carte option to just purchase ESPN. Disney is requiring you to take multiple channels which they forced on DISH (which they tried to force on DIRECTV), thus it is NOT a la carte. Your statement is just plain false. You MUST take ESPN, ESPN2, Disney Channel and ABC Family. That is NOT a la carte. You also MUST take some Scripps and Turner channels. That is not a la carte.
Yes, it is a legit option, no one said it wasn't. We agree.
We've done many calculations on how many people would take just ESPN at $15, $20, $25, $30. We believe there is a market for it. It will gain some traction, no doubt about it. Here's where it gets interesting, however, in many cases it can hurt those conglomerates, which is why they put a cap on it. If a bunch of people bail on pay tv to buy this product and DISNEY is no longer being paid on Disney XD, Disney Junior as they would a MVPD, then that's an issue for them.
Same goes for HBO. Time Warner may hit a home run with OTT HBO, then again, it could mean their CNN, TNT, TBS, etc properties get crushed in the process. Many smart people working on this, they aren't going to kill their golden goose.
I've been working as counter to this product for the last 7 months....we've been all over it with my new gig. Today's article how this isn't a game changer is pretty interesting and what we have also been saying. We believe there is a market, no doubt, but not a game changer in its current state. It's not even an OTT product really. It's a PSN, which I have my own biases against for many reasons, but we'll see how those work.
http://variety.com/2015/digital/news/why-dishs-sling-tv-skinny-internet-bundle-isnt-a-game-changer-1201392269/?utm_source=sailthru&utm_medium=email&utm_campaign=dailyheadlines
Also interesting about a Forbes and Motley Fool article the past week about what was actually a game changer.... :)
http://www.forbes.com/sites/greatspeculations/2014/12/26/directv-launches-over-the-top-streaming-service-for-u-s-hispanic-consumers/
http://www.fool.com/investing/general/2015/01/03/directv-just-went-over-the-top-of-cable-companies.aspx
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Got myself a Roku and $8.99 Netflix for Christmas. I could spend every waking hour of the day watching content just from Netflix.
Enjoy those cable (satellite, whatever) bills, kids.
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Got myself a Roku and $8.99 Netflix for Christmas. I could spend every waking hour of the day watching content just from Netflix.
Enjoy those cable (satellite, whatever) bills, kids.
Actually, the kids are the ones cutting the cord. The only age cohort that's mostly still paying for cable/satellite are technologically illiterate adults through semi-senile boomers.
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Actually, the kids are the ones cutting the cord. The only age cohort that's mostly still paying for cable/satellite are technologically illiterate adults through semi-senile boomers.
True. As someone closer to being a kid than a boomer, I agree.
I just cannot imagine paying the triple figures that people on here and people I know pay for cable. All for what, so they can rent movies for an additional fee? I can rent movies through multiple services on the Roku.
I was back at my parents' over the holidays. A dozen channels on Alaska and another dozen channels on home improvement. What a waste. Why do people spend their few moments on the planet watching this stuff?
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Cable bill just went up to $175 with internet.
Gotta love that even when the meteors are striking all around, some dinosaurs can't see the extinction coming.
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Honest question: where do I watch my Marquette Warriors and other sporting events if not on cable or satellite?
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Nope, ESPN is not offering a la carte option to just purchase ESPN. Disney is requiring you to take multiple channels which they forced on DISH (which they tried to force on DIRECTV), thus it is NOT a la carte. Your statement is just plain false. You MUST take ESPN, ESPN2, Disney Channel and ABC Family. That is NOT a la carte. You also MUST take some Scripps and Turner channels. That is not a la carte.
Yes, it is a legit option, no one said it wasn't. We agree.
We've done many calculations on how many people would take just ESPN at $15, $20, $25, $30. We believe there is a market for it. It will gain some traction, no doubt about it. Here's where it gets interesting, however, in many cases it can hurt those conglomerates, which is why they put a cap on it. If a bunch of people bail on pay tv to buy this product and DISNEY is no longer being paid on Disney XD, Disney Junior as they would a MVPD, then that's an issue for them.
Same goes for HBO. Time Warner may hit a home run with OTT HBO, then again, it could mean their CNN, TNT, TBS, etc properties get crushed in the process. Many smart people working on this, they aren't going to kill their golden goose.
I've been working as counter to this product for the last 7 months....we've been all over it with my new gig. Today's article how this isn't a game changer is pretty interesting and what we have also been saying. We believe there is a market, no doubt, but not a game changer in its current state. It's not even an OTT product really. It's a PSN, which I have my own biases against for many reasons, but we'll see how those work.
http://variety.com/2015/digital/news/why-dishs-sling-tv-skinny-internet-bundle-isnt-a-game-changer-1201392269/?utm_source=sailthru&utm_medium=email&utm_campaign=dailyheadlines
Also interesting about a Forbes and Motley Fool article the past week about what was actually a game changer.... :)
http://www.forbes.com/sites/greatspeculations/2014/12/26/directv-launches-over-the-top-streaming-service-for-u-s-hispanic-consumers/
http://www.fool.com/investing/general/2015/01/03/directv-just-went-over-the-top-of-cable-companies.aspx
The first cell phone didn't put land lines out of business.
The first news blog didn't put newspapers out of business.
The first car didn't eliminate the need for horses and trains.
The first laptop didn't eliminate the need for desktop computers.
Tesla didn't eliminate Ford.
The first MP3 didn't eliminate CDs.
There is an evolution to these things. ESPN being available in a smaller bundle isn't going to be the magic bullet or a game changer.
However, consumer demand is changing. A growing portion of the population may never subscribe to a traditional cable provider in their lifetime.
Cable isn't going to magically go away, but the consumption model is changing. Companies will adapt, or die.
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The first cell phone didn't put land lines out of business.
The first news blog didn't put newspapers out of business.
The first car didn't eliminate the need for horses and trains.
The first laptop didn't eliminate the need for desktop computers.
Tesla didn't eliminate Ford.
The first MP3 didn't eliminate CDs.
There is an evolution to these things. ESPN being available in a smaller bundle isn't going to be the magic bullet or a game changer.
However, consumer demand is changing. A growing portion of the population may never subscribe to a traditional cable provider in their lifetime.
Cable isn't going to magically go away, but the consumption model is changing. Companies will adapt, or die.
Bingo!
What Chicos can't comprehend, for whatever reason, is that these things work in degrees. This is a start - not a final solution.
Luckily, these execs are much smarter than he is. They don't want to change, but know that they must. Networks used to have all of the creative content. Then, after cable advanced a bit, the cable networks grabbed a share. Then with the advent of the iPhone the vice tightened a little more on the networks. And because of mobile computing they are losing still more.
Now, the cable networks are starting to lose some ground. They slowed the tide by selling to Netflix, Hulu, etc., but the progress will not stop.
And the overall cable numbers that chicos likes to quote don't matter. The numbers that matter are the people under 35. Because that is the future. They are NOT going to embrace mobile computing while young and then go back to the older model as they age.
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Honest question: where do I watch my Marquette Warriors and other sporting events if not on cable or satellite?
Once Fox Sports go the route that ESPN is now going, then cable will be gone for me. I have cable strictly for sports.
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The first cell phone didn't put land lines out of business.
The first news blog didn't put newspapers out of business.
The first car didn't eliminate the need for horses and trains.
The first laptop didn't eliminate the need for desktop computers.
Tesla didn't eliminate Ford.
The first MP3 didn't eliminate CDs.
There is an evolution to these things. ESPN being available in a smaller bundle isn't going to be the magic bullet or a game changer.
However, consumer demand is changing. A growing portion of the population may never subscribe to a traditional cable provider in their lifetime.
Cable isn't going to magically go away, but the consumption model is changing. Companies will adapt, or die.
And Amazon didn't (totally) put Barnes and Noble out of business - just moved them towards irrelevance. As an aging boomer I like the feel of a book or newspaper in my hands but the kindle and online news reports have won me over - much more bang for the buck.
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Once Fox Sports go the route that ESPN is now going, then cable will be gone for me. I have cable strictly for sports.
To be fair, I think this is what Chico's and the cable companies are counting on.
They have paid A LOT of money for sports content, so they are going to do everything they can to get you to consume that content by traditional means (to maximize revenue).
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And Amazon didn't (totally) put Barnes and Noble out of business - just moved them towards irrelevance. As an aging boomer I like the feel of a book or newspaper in my hands but the kindle and online news reports have won me over - much more bang for the buck.
Here's one:
Do you think people under 25 know that Amazon was originally a book retailer?
That company has evolved very quickly. It's essentially just a logistics interface, and they do it very well. I use it all of the time.
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Here's one:
Do you think people under 25 know that Amazon was originally a book retailer?
That company has evolved very quickly. It's essentially just a logistics interface, and they do it very well. I use it all of the time.
Amazon Prime is still the greatest deal known to the American consumer.
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Amazon Prime is still the greatest deal known to the American consumer.
I ordered a new set of headphones on a Friday, and they arrived Sunday morning, for FREE. (I have prime).
It's insanely efficient. Love it.
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Once Fox Sports go the route that ESPN is now going, then cable will be gone for me. I have cable strictly for sports.
Same here. If MU was still on the ESPN family of networks as it was in the old Big East, I'd seriously consider this new DISH a la carte option.
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I ordered a new set of headphones on a Friday, and they arrived Sunday morning, for FREE. (I have prime).
It's insanely efficient. Love it.
Not to mention all of the music and video content included free with the subscription. I have Prime, and my fiancee pays for Netflix. And we are thinking about dropping Netflix, because we hardly ever use it anymore. We have cable too. It is probably overkill. But I want my MU basketball, and I can watch just about every game on FS1/2. At least my bill is still under $100 a month. I'd never pay $175. Hards, I'd recommend you switch to a new provider or at least bitch to the retention department that you are going to leave until they cut you a deal. I am lucky that in my neighborhood of Chicago I actually have 2 cable providers, in addition to the satellite/AT&T options. I switch every few years to keep it reasonable.
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Not to mention all of the music and video content included free with the subscription. I have Prime, and my fiancee pays for Netflix. And we are thinking about dropping Netflix, because we hardly ever use it anymore. We have cable too. It is probably overkill. But I want my MU basketball, and I can watch just about every game on FS1/2. At least my bill is still under $100 a month. I'd never pay $175. Hards, I'd recommend you switch to a new provider or at least bitch to the retention department that you are going to leave until they cut you a deal. I am lucky that in my neighborhood of Chicago I actually have 2 cable providers, in addition to the satellite/AT&T options. I switch every few years to keep it reasonable.
Ya, the streaming music and video are great as well. I find myself using it more and more.
The user interface for those products isn't perfect (yet), but I'm sure they will improve over time.
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Nope what? How is it not a la carte? Fewer channels, lower total cost...
I think everyone with half a brain recognizes you are going to pay more per channel with this type of system. But for some people, that is still worth it.
I think we all see what is coming, and it is more of this.
With all due respect. Your definition of a la carte is unlike any I have ever seen, be it for food, tv, etc. That's not a la carte the way you describe it.
A la carte is buying individual items rather than a bundled or part of a set (i.e. a meal).
What DISH is doing, as I stated, the industry has known about for almost a year. Due to MFNs, they couldn't hide it. It is a one stream service, which the media reported. It will attract people who like stuff for free and don't want to pay very much. The question is how much does it cannibalize existing revenue streams for the studios, and they have put in all kinds of safeguards to prevent that....all of which were not reported by the media because the media doesn't know about them or were too lazy to find out. But eventually those will come out as well.
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Actually, the kids are the ones cutting the cord. The only age cohort that's mostly still paying for cable/satellite are technologically illiterate adults through semi-senile boomers.
LOL.
Uhm...no. The folks that pay for cable\satellite (especially satellite) on average have a college degree, make more than $100K a year and are plenty literate, both in real terms and technology terms. Yes, there are a bunch of old farts like Lenny and others that do fit your description in terms of wanting to find other products. But there are also many that could, but don't because they find it a pain in the rear to have 5 different services, instead of one. They like sports, which the others don't provide. They like having 1080P in tangible bit rates on their big screen, not 1080p on a tablet. So on and so forth.
Secondly, kids aren't cutting the cord....they didn't sign up for it in the first place. They are called cord nevers. A big distinction.
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Secondly, kids aren't cutting the cord....they didn't sign up for it in the first place. They are called cord nevers. A big distinction.
Now that's an interesting point.
Is there a recruitment strategy for DirectTV to acquire these types of customers? Obviously exclusive content is one way to do it, but if these folks are already finding enough content elsewhere, what would drive them to DirectTV?
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To be fair, I think this is what Chico's and the cable companies are counting on.
They have paid A LOT of money for sports content, so they are going to do everything they can to get you to consume that content by traditional means (to maximize revenue).
Thank you for quoting him....his ignorance on this stuff remains amazing.
You can tell he has never done anything in his life in the business world and wouldn't understand a contract or a business deal if slapped him in the head.
The sports contracts are spoken for many many many many years. Secondly, the only way sports can survive at today's salaries, etc, is through maximum burdeoning of many people to pay for it. I know people don't like that, but that's the way it is. 90% of the country pays for sports, even though less than 40% gives a rip about it. If it goes to the 40% that gives a rip to be relied on to pay for it, then the costs go up 2.5X if not more. Because guess what, the players and the leagues have learned that the fans gripe a bitch about stuff, but the fans never follow through on their gripes. The fans say during a strike they will stop watching, stop coming...but that isn't the truth. The players and the teams aren't going to take less revenues, because they know the fans, despite their threats, will still watch and still go to the games.
As such, the model is either most of the nation pays a few dollars a month for it, or the model is the sports fans pay a ton for it....either way, the leagues and the teams and the players are going to get theirs.
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Now that's an interesting point.
Is there a recruitment strategy for DirectTV to acquire these types of customers? Obviously exclusive content is one way to do it, but if these folks are already finding enough content elsewhere, what would drive them to DirectTV?
I don't work directly for them anymore....note...I said directly. It's complicated, but I'm 100% in the Over The Top (OTT) space now with the Netflixes, Hulus, Crackles, DramaFevers, Ooyalas, HBOGos, etc of the world). But the answer is yes, the same thing DISH is doing....you target these people with smaller bundles (not a la carte, but smaller bundles) that are more affordable, but you put restrictions on it like one concurrent stream. This is targeted to the single guy that thinks everything should be free for $5.00. That's the market that is targeted for this.
You create programs with major colleges to stream content and get them started young.....did you know only 28% of college kids now bring a tv to their dorm? But 87% have a lap top or tablet. So that's where you go.
The other part that brandx and so many people simply cannot process right now. Where do these people think Directv, Dish, Charter, Comcast, etc are going? They are going to own those pipes as well. This is why AT&T is buying DIRECTV. They're going to control the pipes either way. Including the wireless pipe...wait until you see PCell and those technologies coming. The big guys are going to own all those pipes, and they are moving big time into solidifying those positions.
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Not to mention all of the music and video content included free with the subscription. I have Prime, and my fiancee pays for Netflix. And we are thinking about dropping Netflix, because we hardly ever use it anymore. We have cable too. It is probably overkill. But I want my MU basketball, and I can watch just about every game on FS1/2. At least my bill is still under $100 a month. I'd never pay $175. Hards, I'd recommend you switch to a new provider or at least bitch to the retention department that you are going to leave until they cut you a deal. I am lucky that in my neighborhood of Chicago I actually have 2 cable providers, in addition to the satellite/AT&T options. I switch every few years to keep it reasonable.
LOL....."included for "free".
The American public is duped daily. One of my old bosses is the head of program acquisition for Amazon Prime. There is nothing free about it, but the American consumer will buy some of that stuff up until the cows come home. It is fun to watch. They charge $99 for Prime....it is profitable for them....most of their consumers don't come close to consuming the shipping costs or the content costs for audio and video....note the service was $79 just last year, so that extra $20 is part of that "FREE" stuff. LOL
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I don't work directly for them anymore....note...I said directly. It's complicated, but I'm 100% in the Over The Top (OTT) space now with the Netflixes, Hulus, Crackles, DramaFevers, Ooyalas, HBOGos, etc of the world). But the answer is yes, the same thing DISH is doing....you target these people with smaller bundles (not a la carte, but smaller bundles) that are more affordable, but you put restrictions on it like one concurrent stream. This is targeted to the single guy that thinks everything should be free for $5.00. That's the market that is targeted for this.
You create programs with major colleges to stream content and get them started young.....did you know only 28% of college kids now bring a tv to their dorm? But 87% have a lap top or tablet. So that's where you go.
The other part that brandx and so many people simply cannot process right now. Where do these people think Directv, Dish, Charter, Comcast, etc are going? They are going to own those pipes as well. This is why AT&T is buying DIRECTV. They're going to control the pipes either way. Including the wireless pipe...wait until you see PCell and those technologies coming. The big guys are going to own all those pipes, and they are moving big time into solidifying those positions.
Thanks for sharing.
I appreciate the insights.
While I understand that INSERT CABLE COMPANY will own "the pipe", I also believe that the high price for content delivery leaves a space in the market for somebody to develop a better mousetrap. Now, I have no idea what it will look like, or how it will work. But, I know that if there is a profit to be made, somebody will find out a way to do it.
EXAMPLE: Amazon has basically eliminated Best Buy for me. I haven't been in one of their stores for years. I don't need a salesman. I need a way top purchase products efficiency (headphones, laptop, hard drive, batteries, usb stick, etc.)
10 years ago, that would have been a crazy thought. Today, it seems perfectly rational.
In 10 years, we might see some advances in personalized media that still provide value to the brands/networks, but also offer consumers a more competitive pricing model.
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Not to mention all of the music and video content included free with the subscription. I have Prime, and my fiancee pays for Netflix. And we are thinking about dropping Netflix, because we hardly ever use it anymore. We have cable too. It is probably overkill. But I want my MU basketball, and I can watch just about every game on FS1/2. At least my bill is still under $100 a month. I'd never pay $175. Hards, I'd recommend you switch to a new provider or at least bitch to the retention department that you are going to leave until they cut you a deal. I am lucky that in my neighborhood of Chicago I actually have 2 cable providers, in addition to the satellite/AT&T options. I switch every few years to keep it reasonable.
I'm in the Madison area... not Madison proper. I am stuck with Charter... or I have to switch to Dish/DirecTV. My wife has called the retention department every time that the bill jumps like it just did, and after a while they finally throw us back on to a promotional deal. This time she hasn't had much luck. We will probably give it another go... but if it doesn't work out, I have zero love for Charter. People complain about Comcast on the daily, but I would lay odds that my Charter experience has been total garbage as well.
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Time Warner announced that they will be adding a $2.75 sports surcharge on all bills in order for customers to blame sports for their higher cable bills
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When people talk about $175 cable bill, we need to remember that includes internet access - usually around $45.
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LOL....."included for "free".
The American public is duped daily. One of my old bosses is the head of program acquisition for Amazon Prime. There is nothing free about it, but the American consumer will buy some of that stuff up until the cows come home. It is fun to watch. They charge $99 for Prime....it is profitable for them....most of their consumers don't come close to consuming the shipping costs or the content costs for audio and video....note the service was $79 just last year, so that extra $20 is part of that "FREE" stuff. LOL
Well, considering I probably get well over $99 worth in free shipping, yes, the digital content is free for me. I signed up for Prime before it included digital streaming, so I view it as free.
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When people talk about $175 cable bill, we need to remember that includes internet access - usually around $45.
That's still way too high. Mine is under $100, including internet, TV (HD) and HBO.
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Same here. If MU was still on the ESPN family of networks as it was in the old Big East, I'd seriously consider this new DISH a la carte option.
For a single guy, that makes sense, or someone with a significant other that doesn't care about those services....it can only serve one person, that's the key. It will make sense for some people. Just make sure you are one of the first, because they have to stop selling it when it reaches a certain number. :)
As for Fox, Chase Carey is absolutely against a la carte so I don't think you will see that happen any time soon. They are committed to an authenticated model because of their economic structure, at least for the time being.
The anti-piracy stuff is the stuff that I'm most intrigued by because the studios, networks, leagues, etc are paying so much attention to them now, working with gov'ts on how to stop it, prosecute it, etc. I think change in that space in the next year is going to be very interesting as concurrent streams are reduced, geo targeting tied to IP ownership is implemented, prosecuting individuals and websites, etc. I haven't seen them this ramped up and that's bad news for a lot of people that think the world is free and shouldn't cost anything.
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With all due respect. Your definition of a la carte is unlike any I have ever seen, be it for food, tv, etc. That's not a la carte the way you describe it.
A la carte is buying individual items rather than a bundled or part of a set (i.e. a meal).
I guess my point is that this is a bigger step towards a la carte than we have ever seen. As others have noted on this thread, these things are evolutionary, it does not happen overnight.
I concede it is not true a la carte (paying per channel), but it is close enough, in that the cost is low enough to justify only wanting ESPN/ESPN2 for a lot of people
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As for Fox, Chase Carey is absolutely against a la carte so I don't think you will see that happen any time soon. They are committed to an authenticated model because of their economic structure, at least for the time being.
Please... we have heard all of this from you before.
Only a few months ago you posted an article with this heading from the head of ESPN: SKIPPER FIRMLY AGAINST A LA CARTE:
You also posted the article: A La Carte ESPN Would Cost Consumers $30 Per Month
Now you give us this great "insight" from Fox.
We can also look back to your posts about HBO. Wrong again!
Your MO is always to quote someone else saying what you believe so you have deniability regarding the comments, but we all know better.
We all said it would start small and build from there. We are seeing that now. These are just the first baby steps - we will have to wait and see what happens next - but one thing can be taken to the bank: We ain't going backwards..
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For a single guy, that makes sense, or someone with a significant other that doesn't care about those services....it can only serve one person, that's the key. It will make sense for some people. Just make sure you are one of the first, because they have to stop selling it when it reaches a certain number. :)
As for Fox, Chase Carey is absolutely against a la carte so I don't think you will see that happen any time soon. They are committed to an authenticated model because of their economic structure, at least for the time being.
The anti-piracy stuff is the stuff that I'm most intrigued by because the studios, networks, leagues, etc are paying so much attention to them now, working with gov'ts on how to stop it, prosecute it, etc. I think change in that space in the next year is going to be very interesting as concurrent streams are reduced, geo targeting tied to IP ownership is implemented, prosecuting individuals and websites, etc. I haven't seen them this ramped up and that's bad news for a lot of people that think the world is free and shouldn't cost anything.
I think there are people that feel that this should all be free. Mainly the millenials. However, I think most reasonable people are willing to pay, but won't/can't continue paying 4x the rate of inflation to watch TV. There's a breaking point and it's coming soon.
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I think there are people that feel that this should all be free. Mainly the millenials. However, I think most reasonable people are willing to pay, but won't/can't continue paying 4x the rate of inflation to watch TV. There's a breaking point and it's coming soon.
In all honesty, I have never met a single person who thinks that this should be free.
Of course that doesn't change the fact that many people will attempt to get it free through whatever means they can.
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Thanks for sharing.
I appreciate the insights.
While I understand that INSERT CABLE COMPANY will own "the pipe", I also believe that the high price for content delivery leaves a space in the market for somebody to develop a better mousetrap. Now, I have no idea what it will look like, or how it will work. But, I know that if there is a profit to be made, somebody will find out a way to do it.
EXAMPLE: Amazon has basically eliminated Best Buy for me. I haven't been in one of their stores for years. I don't need a salesman. I need a way top purchase products efficiency (headphones, laptop, hard drive, batteries, usb stick, etc.)
10 years ago, that would have been a crazy thought. Today, it seems perfectly rational.
In 10 years, we might see some advances in personalized media that still provide value to the brands/networks, but also offer consumers a more competitive pricing model.
Some of this is true and many of us have tried like the dickens to intergrate all into one. It's starting to happen, but very slowly.
You will see a point in time an integrated search. You'll go to your cable or satellite or telco video provider, aind withing their GUI you will also see Netflix or Hulu, etc. Now, some are doing this today, but still as an app.
I'm talking about living beyond the app....where it's all part of the same ecosystem. So I search for Unforgiven and it shows up that I can watch it on my HBO service, or on AMC, or on Netflix, etc....all options, all there at one time. The challenge has been Netflix doesn't want to share with Hulu who doesn't want to share with Xfinity who doesn't want to share with .... you get the idea. Plus how to divide the $$$. It will get there eventually, but that is part of the better mousetrap idea.
Ultimately, the number one problem still revolves around content and the enormous costs to make content. Whomever had the landline comparison earlier....might as well compare cadiallacs to french fries. Content is so unique in it's cost to create, produce, develop, etc, that any comparison to any other industry is futile at this point. Those peeps want to get paid....be it actors, athletes, directors, etc.
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Time Warner announced that they will be adding a $2.75 sports surcharge on all bills in order for customers to blame sports for their higher cable bills
This is been going on for at least 2 years if not 3 years. Similar surcharges have come up over local broadcasting networks.
TWC in So. California been going on since January '13. Satellite started in '12 if I recall. Sports channels were (still are) killing MVPDs with distribution demands and costs, so they needed a mechanism to fight back and at least try to educate the consumer where those costs were coming from. For a national provider like a Dish or DTV, you will see them do it on a DMA by DMA level. In some DMAs, there are no surcharges because there are no associated RSN (regional sports network) fees. In some DMAs there are enormous costs like Los Angeles (3 RSNs) or New York (4 RSNs) so the surcharge is high, while still in other DMAs there might be one but at a lower rate like $1.00. It's dependent upon what territory a customer lives, how many RSN's there are and what the costs are due to the number of RSNs serving that territory.
This is why so many MVPDs in So. Cal refused to launch the Dodgers channel, because there is already the Lakers Channel, Fox Sports West, Prime Ticket. Three RSNs for the Angels, Ducks, Lakers, Kings, UCLA, USC, Clippers. The Dodgers used to be part of that mix, but they broke off to create their own. It would have added another $5 a month in costs to consumers for that one channel. The MVPDs said no. Enough.
Sports is an enormous cost to television pricing. ENORMOUS.
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Well, considering I probably get well over $99 worth in free shipping, yes, the digital content is free for me. I signed up for Prime before it included digital streaming, so I view it as free.
Understood....but the irony in all this is this is a classic example where you are getting the benefit of a BUNDLED DEAL. Others are subsidizing your shipping costs, you make out for it.
Just as you do with sports channels, etc on television.
Those that don't ship a lot that pay for Prime, actually lose out on it. Same as those that are paying for TV but don't care about sports, they are subsidizing the rest.
Ironic.
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I think there are people that feel that this should all be free. Mainly the millenials. However, I think most reasonable people are willing to pay, but won't/can't continue paying 4x the rate of inflation to watch TV. There's a breaking point and it's coming soon.
I've been hearing that for 15 years. Same for college expenses. Gasoline...we were all going to ditch our cars. So on and so forth.
Life is about choices. If you don't want it, don't pay for it. Or, instead of paying $6 a day for your Starbucks habit, pay $3 a day for television. No one is putting a gun to anyone's head.....unless of course it's the gov't and forcing you to buy healthcare....ironic....another way people have to subsidize others....but it's ok in that case. LOL
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I've been hearing that for 15 years. Same for college expenses. Gasoline...we were all going to ditch our cars. So on and so forth.
Life is about choices. If you don't want it, don't pay for it. Or, instead of paying $6 a day for your Starbucks habit, pay $3 a day for television. No one is putting a gun to anyone's head.....unless of course it's the gov't and forcing you to buy healthcare....ironic....another way people have to subsidize others....but it's ok in that case. LOL
Good Lord, can you check the Rush Limbaugh schtick at the door?
My point is your point (your first point, anyway). Nobody is forced to buy TV. Nobody is forced to pay for coffee.
But the TV bubble is on it's way and much of the public will be making choices between life's luxuries. Coffee will win out more than many TV execs think.
You can't just throw infinite billions of dollars at sports leagues, expect the consumer to pick up the tab and enjoy wild success for an infinite amount of time
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Good Lord, can you check the Rush Limbaugh schtick at the door?
My point is your point (your first point, anyway). Nobody is forced to buy TV. Nobody is forced to pay for coffee.
But the TV bubble is on it's way and much of the public will be making choices between life's luxuries. Coffee will win out more than many TV execs think.
You can't just throw infinite billions of dollars at sports leagues, expect the consumer to pick up the tab and enjoy wild success for an infinite amount of time
He can't. He is far more secure in his bubble that he has created for himself.
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Good Lord, can you check the Rush Limbaugh schtick at the door?
Good Lord, what does that even mean?
Also, I love how if Chicos says some Vets are disappointed in the direction of our country, the libs on this board start wetting their pants about the "politicization" of threads or whatever. But attacking Rush Limbaugh or whatever clearly isn't political. ::)
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I've been hearing that for 15 years. Same for college expenses. Gasoline...we were all going to ditch our cars. So on and so forth.
Life is about choices. If you don't want it, don't pay for it. Or, instead of paying $6 a day for your Starbucks habit, pay $3 a day for television. No one is putting a gun to anyone's head.....unless of course it's the gov't and forcing you to buy healthcare....ironic....another way people have to subsidize others....but it's ok in that case. LOL
Knock it off.
We were having a pretty good discussion over the past 48 hours.
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Good Lord, what does that even mean?
Also, I love how if Chicos says some Vets are disappointed in the direction of our country, the libs on this board start wetting their pants about the "politicization" of threads or whatever. But attacking Rush Limbaugh or whatever clearly isn't political. ::)
What the hell are you talking about?
There was nothing political about this thread until Chicos made it political.
Its obnoxious. We were having good discussion (Chicos included, until he went there). And now we are one more post from you or Chicos from getting it locked. Contribute something worthwhile or get lost.
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Some of this is true and many of us have tried like the dickens to intergrate all into one. It's starting to happen, but very slowly.
You will see a point in time an integrated search. You'll go to your cable or satellite or telco video provider, aind withing their GUI you will also see Netflix or Hulu, etc. Now, some are doing this today, but still as an app.
I'm talking about living beyond the app....where it's all part of the same ecosystem. So I search for Unforgiven and it shows up that I can watch it on my HBO service, or on AMC, or on Netflix, etc....all options, all there at one time. The challenge has been Netflix doesn't want to share with Hulu who doesn't want to share with Xfinity who doesn't want to share with .... you get the idea. Plus how to divide the $$$. It will get there eventually, but that is part of the better mousetrap idea.
Ultimately, the number one problem still revolves around content and the enormous costs to make content. Whomever had the landline comparison earlier....might as well compare cadiallacs to french fries. Content is so unique in it's cost to create, produce, develop, etc, that any comparison to any other industry is futile at this point. Those peeps want to get paid....be it actors, athletes, directors, etc.
I brought up the landline comparison, and this is where we fundamentally disagree.
I don't think content is that expensive to create. I think it WAS expensive to create back in the day (film, staff, actors, sets, distribution, etc.)
I don't think it's that expensive anymore, and I think the system is adapting.
You and I have already had this conversation, so we don't need to rehash it again. It's just a fundamental point that we disagree on.
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I brought up the landline comparison, and this is where we fundamentally disagree.
I don't think content is that expensive to create. I think it WAS expensive to create back in the day (film, staff, actors, sets, distribution, etc.)
I don't think it's that expensive anymore, and I think the system is adapting.
You and I have already had this conversation, so we don't need to rehash it again. It's just a fundamental point that we disagree on.
I think it just depends on the content. Game of Thrones is expensive to create. A YouTube superstar with millions of views can create content for virtually nothing. Both are capable of bringing in A LOT of money.
I think there will always be expensive blockbuster content, with big actors and effects. But the difference is, you don't NEED that sort of investment to get a return. And other people will innovate and find ways to do it less expensively. The field is becoming much more open.
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I think it just depends on the content. Game of Thrones is expensive to create. A YouTube superstar with millions of views can create content for virtually nothing. Both are capable of bringing in A LOT of money.
I think there will always be expensive blockbuster content, with big actors and effects. But the difference is, you don't NEED that sort of investment to get a return. And other people will innovate and find ways to do it less expensively. The field is becoming much more open.
Exactly. I realize the the large scale movies and whatnot cost a TON of money. No doubt.
But, as an example, I was very entertained by "Serial podcast"... which didn't even require a video camera. So, content and entertainment aren't really that expensive to make if they are done correctly.
Not EVERYTHING has to be a blockbuster.
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Exactly. I realize the the large scale movies and whatnot cost a TON of money. No doubt.
But, as an example, I was very entertained by "Serial podcast"... which didn't even require a video camera. So, content and entertainment aren't really that expensive to make if they are done correctly.
Not EVERYTHING has to be a blockbuster.
Serial is an even better example.
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I wonder how Chicos feels now that his company is "censoring" Fox News. :P
http://247wallst.com/media/2015/01/12/bill-oreilly-charges-dish-network-with-censorship/
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I wonder how Chicos feels now that his company is "censoring" Fox News. :P
http://247wallst.com/media/2015/01/12/bill-oreilly-charges-dish-network-with-censorship/
Stop.
I've given chico's some grief about this kind of stuff, and now you're doing the same kinda thing.
If you want to troll each other, just send him a private message.
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Stop.
I've given chico's some grief about this kind of stuff, and now you're doing the same kinda thing.
If you want to troll each other, just send him a private message.
You are completely right on this, Ammo.
My comments should have stayed on-issue. I should have asked why is it censorship when Fox is in a Money dispute, yet censorship was never raised when CBS was in the exact same type of dispute.
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You are completely right on this, Ammo.
My comments should have stayed on-issue. I should have asked why is it censorship when Fox is in a Money dispute, yet censorship was never raised when CBS was in the exact same type of dispute.
Because the gasbag Bill O’Reilly works for Fox News and not CBS?
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You are completely right on this, Ammo.
My comments should have stayed on-issue. I should have asked why is it censorship when Fox is in a Money dispute, yet censorship was never raised when CBS was in the exact same type of dispute.
Because liberals are stupid and conservatives are bad.
We good?
Cool.
Let's move off of the not-so-subtle political jabs. There is a special forum that was created for that.
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I should have asked why is it censorship when Fox is in a Money dispute, yet censorship was never raised when CBS was in the exact same type of dispute.
If you don't know the answer to your own question, then I am ashamed for having been educated by the same university as you.
Otherwise, flame on at your own risk.
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No politics.