[opendtv] Re: Devastating to consumers?

At 1:58 PM -0400 4/16/08, Manfredi, Albert E wrote:

 > Can someone explain why it would be devastating to eliminate

 channels that I do not watch that I am now forced to pay for?


They explain. It will give the consumer less choice for typically more
money. They explain that the consumers who would benefit are only those
who buy a "handful" of channels only.


Who is "they."
We are not talking about offering everything ala carte, only those channels with higher fees. 

And me thinks "they" are full of it.
The cable and DBS companies do not directly benefit from subscriber fees; they are just collecting money for the conglomerates. It is possible that the cable industry sneaks in a little extra for themselves when they raise rates to cover new re-trans consent deals.
The only parties that I can see being devastated are the the content owners who are collecting money from A BUNCH of people who are NOT watching the content they are forced to pay for.
AND BERT, PLEASE do not remind us that nobody is forced to subscribe. The issue here is illegal tying. Using something that people want to tie another product that they do not want.
We've been through all of this many times - the reality is that there is NO REASON for people to pay more under an ala carte scheme. The only additional cost to the multi-channel system operator is to keep tack of this - something that the DBS guys do already and the cable systems do already via their digital tiers.
The problem is the cable extended basic analog tier, which is sold as a bundle. Individual channels cannot be blocked unless the cable co provides a conditional access box. 







They also explain that program diversity would suffer. All stuff we have
already talked about on several occasions.


Why? The programs would still be available.


If your accounting costs go up, the "average" subscriber will pay a
little more, the low-ball subscriber will pay less, and the big-time
subscriber will pay a lot more.
The big time subscriber is already paying more - they are buying multiple tiers. IF it really is more efficient to bundle, then they should not pay a penny more. It is the consumers who drop channels that they are concerned about. 



That's not realistic. What would happen is that the costs would become
rejiggled with a la carte.
Yes they would. The content providers would be the ones doing the rejigging. They would be faced with a loss of possible viewers and the related subscriber fees. So most likely they would drop the subscriber fees so as to not lose audience. In other words, they would operate like most other commercial broadcasters around the world, selling ads based on ratings, rather than expecting subsidies from people who don't even watch their programs. 


Take the extreme: all consumers request only one channel. That one
channel has to cover the entire cost of the infrastructure, so it will
cost a lot, considering what you're getting. Yeah, consumers would be
outraged.
WRONG. The infrastructure costs is covered 100% by the portion of the bill that pays for the operation of the infrastructure. Subscriber fees only benefit the cable and DBS operators IF they can hold onto the cash flow long enough to make money off the float.
Let's take a look at another extreme. What if everyone just downloaded their content via the Internet using a broadband service. The broadband service fee is analogous to the portion of the cable bill for infrastructure. The cost for downloaded content is the content portion of the cable bill. 

So ala carte is likely to happen one way or another...eventually.



A less extreme condition is where some of the unpopular shows are
dropped for lack of interest. But those shows are probably not the
expensive ones, so the subscriber will end up not saving anything. The
higher accounting costs will simply mask any savings you might have
expected.
It is unlikely that there are any cable channels that are only surviving because of subscriber fees. They still need ratings to sell the ads. If people are not watching under the current regimen, ala carte is not gong to decrease ratings, just over the transom revenues. 



You probably think that telephone companies should go back to charging
for individual telephone calls, whether local or long distance. And that
on average, everyone would save that way.


No.
I think that it got to the point where tracking everything cost more than the incremental profits from charging for every call. In essence the real cost is being attached to the network - the cost of a call is virtually free.
By the way, we are just now getting to the point where you can buy all-you-can eat wireless service. 



The good news would be that without the "150 channels for one low
price," consumers would think twice about going to MVPDs at all. Paying
a lot for a few channels should give any sensible person pause.
I am in general agreement on this. I think that the congloms are just training us to pay for our TV fix so that they can bypass the multichannel operators - or turn them into common carriers. 

Regards
Craig


----------------------------------------------------------------------
You can UNSUBSCRIBE from the OpenDTV list in two ways:
- Using the UNSUBSCRIBE command in your user configuration settings at FreeLists.org 
- By sending a message to: opendtv-request@xxxxxxxxxxxxx with the word 
unsubscribe in the subject line.

Other related posts: