Fear Not MU Scoopsters

[JoBo2756]

http://www.casualhoya.com/2012/11/27/3698576/big-east-tulane-east-carolina-big-ten-big-12-pac-10-acc-maryland-rutgers-ncaa-realignment

Just read it. It's worth it.

This jumping of conferences for bigger TV contracts is a bubble. Newer ways of consuming and watching games are being developed and they aren't coming through big contracts with ESPN.

Schools jumping conferences, skipping out on long-standing rivalries, for a sliver of that extra cash are diluting their brand - the most important asset they will have in the future, when streaming games on thousands of different devices is going to be the norm.


I think we need to stick to our guns in the BEAST (or form another bball only league) and partner with an innovator like Apple, Google for exclusive rights to broadcast on mobile platforms.

Thoughts?

[JamilJaeJamailJrJuan]

http://www.casualhoya.com/2012/11/27/3698576/big-east-tulane-east-carolina-big-ten-big-12-pac-10-acc-maryland-rutgers-ncaa-realignment

Just read it. It's worth it.

This jumping of conferences for bigger TV contracts is a bubble. Newer ways of consuming and watching games are being developed and they aren't coming through big contracts with ESPN.

Schools jumping conferences, skipping out on long-standing rivalries, for a sliver of that extra cash are diluting their brand - the most important asset they will have in the future, when streaming games on thousands of different devices is going to be the norm.


I think we need to stick to our guns in the BEAST (or form another bball only league) and partner with an innovator like Apple, Google for exclusive rights to broadcast on mobile platforms.

Thoughts?

Sure, as long as every game is broadcast on tv as well. Watching every game on a phone would blow.

[Tugg Speedman]

Sure, as long as every game is broadcast on tv as well. Watching every game on a phone would blow.

Apple and Google will eventually run the planet.  So, yes partner with them. 

[JoBo2756]

Sure, as long as every game is broadcast on tv as well. Watching every game on a phone would blow.

Sorry it won't be all mobile. There is such a thing as Apple TV already.

[Aughnanure]

Yeah, cause you can't hook up a computer to a TV? The TV is just a monitor.

[🏀]

Yeah, cause you can't hook up a computer to a TV? The TV is just a monitor.

And a cable box is a small computer.

[ChicosBailBonds]

http://www.casualhoya.com/2012/11/27/3698576/big-east-tulane-east-carolina-big-ten-big-12-pac-10-acc-maryland-rutgers-ncaa-realignment

Just read it. It's worth it.

This jumping of conferences for bigger TV contracts is a bubble. Newer ways of consuming and watching games are being developed and they aren't coming through big contracts with ESPN.

Schools jumping conferences, skipping out on long-standing rivalries, for a sliver of that extra cash are diluting their brand - the most important asset they will have in the future, when streaming games on thousands of different devices is going to be the norm.


I think we need to stick to our guns in the BEAST (or form another bball only league) and partner with an innovator like Apple, Google for exclusive rights to broadcast on mobile platforms.

Thoughts?

There are major problems with this.  Ultimately, it's about who owns the rights to broadcast and those are tied up by the major content providers.  Sure, there are all kinds of new ways to deliver content, but if they don't own the rights to do so, doesn't mean a hill of beans.  The rights are the keys and when ESPN, Fox, Directv, or whomever is spending billions on rights, they make damn sure all of the OTT (Over the Top) angles are covered.  If they aren't covered, the value for those rights goes down because it puts at risk the additional ways the product can be consumed which no one worth their salt is going to spend a bunch of money on to have it be undersold to them on another device \ platform.   The bubble may burst, but with the amount of money that everyone is paying for sports fees right now, those dollars have to be recouped somehow.  ESPN spending billions on MNF, Fox spending billions on baseball (rumor out here for $6 billion for the Dodger rights), etc. 

[JoBo2756]

There are major problems with this.  Ultimately, it's about who owns the rights to broadcast and those are tied up by the major content providers.  Sure, there are all kinds of new ways to deliver content, but if they don't own the rights to do so, doesn't mean a hill of beans.  The rights are the keys and when ESPN, Fox, Directv, or whomever is spending billions on rights, they make damn sure all of the OTT (Over the Top) angles are covered.  If they aren't covered, the value for those rights goes down because it puts at risk the additional ways the product can be consumed which no one worth their salt is going to spend a bunch of money on to have it be undersold to them on another device \ platform.   The bubble may burst, but with the amount of money that everyone is paying for sports fees right now, those dollars have to be recouped somehow.  ESPN spending billions on MNF, Fox spending billions on baseball (rumor out here for $6 billion for the Dodger rights), etc. 

That's actually just one problem... the rights.

I'm not saying that we have a deal with ESPN AND Apple. I'm saying we have a deal with Apple. Give them the rights...

Of course, we'll have to think about how is actually doing the broadcasts and how that will be produced, etc. because it's ESPN now.

Of course this is all just speculation. Apple or Google may have NO interest in sports, BUT Google is getting into producing entertainment with YouTube, so its not farfetched for them to try to upend this sports TV model.

[77ncaachamps]

$6b for the Dodgers?!

Someone is getting RIPPED OFF!!!

[ChicosBailBonds]

$6b for the Dodgers?!

Someone is getting RIPPED OFF!!!

Now looking like it might be close to $7 billion.  The only way they (FOX) can pay for it is to have massive distribution (no a la carte) and charge huge rates.  That is why cable, satellite, telco video bills will go up.  Sports costs are unbelievable right now.

http://www.businessweek.com/news/2012-11-25/fox-closes-on-6-billion-7-billion-dodgers-deal-deadline-says

[Groin_pull]

Now looking like it might be close to $7 billion.  The only way they (FOX) can pay for it is to have massive distribution (no a la carte) and charge huge rates.  That is why cable, satellite, telco video bills will go up.  Sports costs are unbelievable right now.

http://www.businessweek.com/news/2012-11-25/fox-closes-on-6-billion-7-billion-dodgers-deal-deadline-says

Chicos,

Obviously, this is great for the Dodgers. But how does Fox justify that incredible rights package ($7B  ). No one really watches baseball...certainly not during the regular season. So if the ratings are so-so at best, how does this makes sense?

Is it just all about TV sets and potential viewers?

[GGGG]

Chicos,

Obviously, this is great for the Dodgers. But how does Fox justify that incredible rights package ($7B  ). No one really watches baseball...certainly not during the regular season. So if the ratings are so-so at best, how does this makes sense?

Is it just all about TV sets and potential viewers?

Correct.  So the risk if the bubble might pop is on ESPN, etc.  Not the conferences.  So why should the leaders of these schools be concerned if there is a bubble?  They can cash the checks anyway.  And when the rights are ratcheted downward in the future, they can readjust then.

[ChicosBailBonds]

Chicos,

Obviously, this is great for the Dodgers. But how does Fox justify that incredible rights package ($7B  ). No one really watches baseball...certainly not during the regular season. So if the ratings are so-so at best, how does this makes sense?

Is it just all about TV sets and potential viewers?

I don't know how they justify it.  My former boss now leads Fox sports and I can't wait to have a beer with him when this is over to understand it.  Either they think they can get 6X the advertising revenue they used to get (certainly the team will be much better because they will buy every high priced talent you can imagine), or they expect all the distributors to pony up money at rates never before even imagined.

This is mostly about local rights.  The Dodgers and Lakers are the key properties in this city and when the Lakers left Fox earlier this year for TWC Sports and $2 billion, that smarted Fox quite a bit.  The arms race right now is going crazy and most distributors will not be able to swallow this.  So I don't know who is actually going to carry these guys.  The Lakers get about $3.95 (public knowledge) per tv subscriber per month in the territory.  This Dodgers deal will triple that.  Imagine in your monthly television bill that 15 to 20% is going for ONE CHANNEL.  Now imagine if you hate the Dodgers, hate baseball, don't care about sports but you are forced to pay it anyway because they refuse to sell the rights to a distributor unless they get 90% of your subs so they can sell the advertising.  If it were to ever go a la carte, the price would have to be about $45 to $55 per month for that one channel because all those that don't care for it wouldn't be subsidizing it.  That's always been the problem with a la carte that most people don't understand.

The system is so broken right now and sports is driving 80% of the programming cost increases.  This deal might finally derail the whole thing.  Most of the ESPN deals come up in the next two years for distributors.  Then you have a bunch of the RSNs.  It's going to get beyond wild.

[Classof83]

To put this loss in perspective, my son, who watches EVERY MU game to the bitter end, turned the game off 5 minutes into the second half to watch soccer instead...and it was Tijuana v. Toluca.  

[GOO]

I would love it if Apple or Google would buy the rights and stream.  Apple would sell a lot of those $99 Apple TV's.
I would pay per game or for a subscription, of course. 
Now, exposure would take a hit, so that would be a problem.  I think to make it work from an exposure standpoint, you have to include ESPN and/or an NBC or CBS for some games as well.

To break  up the cable distribution system, in my opinion, all that is needed as a spear is the 4 main networks streaming over Apple TV.  Many consumers, if they could easily get the networks (without an antenna)  would add hulu, netflix, and cut out cable. 

Then other channels would start to follow suit, and many of those channels get pennies from the cable companies, so consumer would probably have to pay a buck or two per channel per month.  Still, one could get the channels they want without paying a whole lot... EXCEPT for live sports as that is the cable bill killer, from what I understand.  But most people can live without ESPN, etc.

So, I see the very real possibility that these deals are bubbles.  The Big 10 network will go poof in an instant if it isn't bundled.  And athletic departments that base their budgets on these revenue streams will have real financial issues.  Also, football is probably at a peak... is it a bubble?  I don't see it being anymore popular in 10 years and probably declining.         

Chicos, what is preventing the networks from offering ala carte via stream or via Apple TV?  You can get a lot of the shows right from their webpages already for free, but that is inconvenient. I see the 4 networks as the key to breaking up the bundles.  Give me the 4 networks and netflix over an Apple TV and I'll gladly kill the cable bill.  It is worth missing a few games or watching at a bar once in a while. 

I'd think the networks could get do okay selling their stream to an Apple for a couple of bucks per user per month. 

[ChicosBailBonds]

Chicos, what is preventing the networks from offering ala carte via stream or via Apple TV?  You can get a lot of the shows right from their webpages already for free, but that is inconvenient. I see the 4 networks as the key to breaking up the bundles.  Give me the 4 networks and netflix over an Apple TV and I'll gladly kill the cable bill.  It is worth missing a few games or watching at a bar once in a while. 

I'd think the networks could get do okay selling their stream to an Apple for a couple of bucks per user per month. 

Money...BIG money.  Those networks, despite the claim they are "free over the air", are not free over the air for most consumers.  DISH, DIRECTV, FIOS, Time Warner, Charter, etc, etc pay them billions of dollars in RE-TRANS fees each year to have that programming.  You can imagine that those distributors that are forced to pay all that money want sizable protections.  Why should DISH have to pay FOX all that money for their network feeds if FOX is going to sell it a la carte?  DISH will just say no way, not going to pay you.  The networks need that guaranteed revenue to develop their programming, pay salaries, etc, etc.  They need PREDICTABLE revenue streams, not ones based on popularity of a show that might do well a la carte or might not, where the risk is totally on the network. 

Secondly, production and content.  Say during a 24 hour period a network only has 4 hours worth of programming you are willing to pay for.  Say your choice for those 4 hours lines up pretty well with many others.  How is the programming for the other 20 hours going to be paid for?  Television is a complex business where there is trial and error all the time in introducing new shows that can take even several years to get a strong foothold.  If you cut off that kind of funding, you'll see a lot less content and development.  What's the incentive to develop a show that costs a lot of money if it is going on a la carte and may not make it at an individual price point?  There is none.  Too much risk.  This is why people don't understand that if TV went to an a la carte model you might be able to lower your bill but you will pay far more per channel plus lose likely half the channels you have.  Many channels survive based on the subsidy of other channels.  Could ESPNU survive on it's own without ESPN and ESPN2?  Not likely.  Certainly not ESPN Classic. Now, you may say "I never watch those anyway"...the thing is, you actually do watch ESPNU every once in awhile for MU games.  Just an example, but one person's "I never watch channel" is another person's must have channel but in lower numbers.

[muwarrior69]

Hi Chicos,

Out of curiosity who carries the WCC basketball games on the west coast and how much does each school get?

[ChicosBailBonds]

Hi Chicos,

Out of curiosity who carries the WCC basketball games on the west coast and how much does each school get?

ESPN has a WCC deal that lasts until 2019 I believe.  I don't have the value of that contract, but I suspect it is quite small.

[Dawson Rental]

I don't know how they justify it.  My former boss now leads Fox sports and I can't wait to have a beer with him when this is over to understand it.  Either they think they can get 6X the advertising revenue they used to get (certainly the team will be much better because they will buy every high priced talent you can imagine), or they expect all the distributors to pony up money at rates never before even imagined.

This is mostly about local rights.  The Dodgers and Lakers are the key properties in this city and when the Lakers left Fox earlier this year for TWC Sports and $2 billion, that smarted Fox quite a bit.  The arms race right now is going crazy and most distributors will not be able to swallow this.  So I don't know who is actually going to carry these guys.  The Lakers get about $3.95 (public knowledge) per tv subscriber per month in the territory.  This Dodgers deal will triple that.  Imagine in your monthly television bill that 15 to 20% is going for ONE CHANNEL.  Now imagine if you hate the Dodgers, hate baseball, don't care about sports but you are forced to pay it anyway because they refuse to sell the rights to a distributor unless they get 90% of your subs so they can sell the advertising.  If it were to ever go a la carte, the price would have to be about $45 to $55 per month for that one channel because all those that don't care for it wouldn't be subsidizing it.  That's always been the problem with a la carte that most people don't understand.

The system is so broken right now and sports is driving 80% of the programming cost increases.  This deal might finally derail the whole thing.  Most of the ESPN deals come up in the next two years for distributors.  Then you have a bunch of the RSNs.  It's going to get beyond wild.

To me your post seems to make a la carte sound like the solution, not the problem.  At least from a subscriber point of view.  At least for those subscribers who are willing to do without the high outrageously priced sports programming.

[ChicosBailBonds]

To me your post seems to make a la carte sound like the solution, not the problem.  At least from a subscriber point of view.  At least for those subscribers who are willing to do without the high outrageously priced sports programming.

They can't get enough money from the subscribers to make it a go.  If you reduce the number of subscribers (which a la carte  does), you have to charge a LOT more for the programming in order for the rights fee payer to break even and make any money.

If I didn't convey that properly, my fault.  

A la carte won't work...good article on this and there are many over the years.  http://articles.latimes.com/2012/oct/05/entertainment/la-et-ct-cable-prices-20121005


http://www.techdirt.com/articles/20071126/030522.shtml

[Dawson Rental]

They can't get enough money from the subscribers to make it a go.  If you reduce the number of subscribers (which a la carte  does), you have to charge a LOT more for the programming in order for the rights fee payer to break even and make any money.

If I didn't convey that properly, my fault.  

No, you conveyed nicely.  I'm just trying to convey my opinion that NO ONE should have to be forced to pony up for for these outrageously high sports fees when they would chose not to.  And then if the fees can't be swallowed by those who are actually watching the programming - because ESPN or Fox or whomever negotiated the fees, overbid for them assuming that they could make them palatable by spreading them among viewers who don't particularly want the programming - then ESPN or Fox or Etc. can just go to bankruptcy court to fix their screwup.  How can the cable sports networks not see that this will blow up in their face?  Do they really think that they will be allowed to significantly raise the cost of everyone's cable, even those who don't want sports programming, because that's the only way they can meet their broadcasting rights?  Do they really think that they can force this through by threatening to take away cable TV from those viewers who won't yield to this ransom demand?

The situation is analogous to sports teams bidding for free agent players in a league without a salary cap.  It doesn't work there, and it won't work here either.  Even though cable sports networks think that they can get around it by spreading the cost around to non users.  The cable sports networks will find that they will have forced a la carte cable pricing upon themselves through government intervention through this folly.

My modification after your modification adding the article on a la carte pricing.
Okay, I'm not saying that we will see complete, true a la carte pricing where one only pays for those exact channels that one watches.  What I believe we will see is sport channels put in premium packages (or sold a la carte) that will cost a whole lot more to a point where subscribers will seriously rethink whether they want to have them.  We're not talking about universal phone service where everyone paid a small fraction of the cost to bring (wired) phone service to remote locations.  We're talking about people being forced to pay for high priced programming that they don't want because that's the only way for a cable service provider to be able to offer those channels economically to those who do want them because cable sports network overbid for the rights to that programming.

[Canned Goods n Ammo]

They can't get enough money from the subscribers to make it a go.  If you reduce the number of subscribers (which a la carte  does), you have to charge a LOT more for the programming in order for the rights fee payer to break even and make any money.

If I didn't convey that properly, my fault.  

A la carte won't work...good article on this and there are many over the years.  http://articles.latimes.com/2012/oct/05/entertainment/la-et-ct-cable-prices-20121005


http://www.techdirt.com/articles/20071126/030522.shtml

Cable is a communist system with the best networks propping up the worst.
Let the free market take over and only the strong survive!
(That's only sorta sarcastic)

Oh, and these television deals will come crashing down at some point. The way people intake content is changing RAPIDLY.

If google/apple/facebook ever want to really get into the live content business, the entire model will change.

Google could charge a pretty penny for customized adspace that plays during a live sports broadcast. Every viewer would receive their own customized set of ads based upon their google algorithm. Much more effective than the standard pop-ups or current commercials (which only target the demographics of the general viewer).

Google won't make the fees that ESPN makes by charging the cable companies (that's some good coin), but if google fiber keeps going, google will be the cable company!

You download the "google sports app" for $X, and boom, you have "google sports" on every piece of electronics you own.

It's obviously not this easy, especially given the expertise and infrastructure in place at ESPN. But, when products become large and somewhat bloated... it opens the marketplace for new competition.

PREVIOUS EXAMPLES: American auto industry in 70's/80's, Best Buy more recently.

The model will evolve as technology and consumer tastes evolve.

[The Lens]

No, you conveyed nicely.  I'm just trying to convey my opinion that NO ONE should have to be forced to pony up for for these outrageously high sports fees when they would chose not to.  

We all have a choice. Cable and Dishes are products. You're not forced into anything. 

[Parsighian]

We all have a choice. Cable and Dishes are products. You're not forced into anything. 

Nobody is forced to drink alcohol or chase poon but damned if we don't do it with tremendous abandon.

[JoBo2756]

Who changed my headline?