[opendtv] Re: Distribution outside of "the bundle"
- From: Craig Birkmaier <craig@xxxxxxxxxxxxx>
- To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
- Date: Wed, 10 Dec 2014 09:24:35 -0500
> On Dec 9, 2014, at 8:30 PM, Manfredi, Albert E <albert.e.manfredi@xxxxxxxxxx>
> wrote:
>
> Which kind of tells us that your "exclusive" "the bundle" content is not
> exclusive anymore, or at least, the most popular content may be becoming less
> so. Except certain sports. As long as each episode costs $2, well, you could
> rationalize that no one would use that option as a regular viewing option,
> outside "the bundle."
Sounds like we are debating the virtues of buying content ala carte. Apparently
Bert has no problem with the idea of buying content on an ala carte basis to
avoid paying for content you don't watch, even if you wind up paying more...
>
> Sounds like a competitive price, but few people would be satisfied anymore
> with analog TV images on their nice LCD TVs. Just seeing the last days of
> analog TV, is my bet.
My daughter and son in-law are doing it. They cut the cord to save some money,
but still subscribe to broadband; but Cox cable can't provide broadband and
shut off analog TV. So they get the analog TV bundle "free." I guess we can
blame those damn consumer electronics TV manufacturers for putting cable ready
tuners in every TV, along with those mandated DTV tuners.
>> No Bert [TVE] is absolutely relevant. It is another way to watch
>> your favorite shows on YOUR schedule, on the device of YOUR
>> choice, without paying more.
>
> We've been over this, Craig. With OTA TV, you can also watch content on
> whatever device you want, without paying more, so this huge new deal is kind
> of lost to me. We've seen boxes that convert the OTA signal to IP streams,
> right? And for VOD, the congloms already have that on the Internet.
Where to start...
Most of what I watch IS NOT available from OTA TV.
None of the devices I own have OTA tuners, except for my family room TV, for
which the OTA tuner Is mandated (but unused). Oh wait, I can BUY a Sling Box so
I can watch over the Internet, but that ain't free.
And why would I go to a conglom website to watch a show on my iPad that I don't
want to watch on the TV in my Family Room?
> What is not lost to me is that TVE is a scheme which "pretends" that TV
> content must still be delivered by this monopolistic medium. It's a bit like
> the neighborhood gasoline station trying to sell me a coupon book. I have a
> ton of other gas stations I could use, but if I "invested" in that coupon
> book, I would become a loyal customer of that one station. Well, come now.
Your analogy is interesting but not very relevant - kinda like all those
loyalty cards that every retailer now offers.
TV Everywhere is a key element in the evolution of the MVPD bundling model.
There are two main elements to this strategy:
1. For pre produced content, it enables the shift from appointment TV to VOD.
Each channel in the bundle gains the ability to create their own front end to
both current shows and their library content.
2. For the limited amount of content that is primarily viewed live, it provides
access on any device, anywhere.
> You're not seeing the bigger perspective. People are cutting or shaving that
> cord. People who, unlike you, are willing to find alternatives that are "good
> enough," in the near term. As more such people exist, and more are existing,
> the content owners, themselves, take action. Content owners deciding to make
> their content available in other ways, through other sites, sometimes even
> just ad supported (e.g. ESPN MLS). In short, the change in TV distribution is
> happening in spite of those still-loyal MVPD subscribers. It takes THESE
> OTHER consumers to make it happen, and (thankfully) they exist.
And there are people who only buy gas from Exxon stations because they have an
Exxon credit card and get some associated perks.
Nobody is saying that cord cutting is not happening Bert. Clearly there is a
segment of the population that can get by with good enough; whether this is
being caused by economic hardship or the availability of other choices really
does not matter. What matters is how long the congloms can maintain their
oligopolies and profit from the extended basic business model.
As I keep saying, let me know when less than 70% of U.S. homes subscribe to the
extended basic bundle.
> But they haven't (yet perhaps?) increased what I pay, Craig.
And there are AtV Never's out there too Bert. It would be helpful for f you
would at least admit you pay for TV at the checkout counter. Advertisers spent
about $171 billion on TV ads last year. Like embedded taxes, that $171 billion
is a component of nearly everything you buy.
> What you pay, sure, but only because you let them. I have no quarrel with
> content conglomerates continuing to make money. None at all. They generate
> the content that people want, no matter what the distribution technology
> might be. They deserve to survive this transition. My beef is only with those
> who would limit the distribution options we should see, and that includes
> device makers who deliberately cripple their receivers.
Stop with the device maker complaints Bert. The content owners are responsible
for all of the restrictions you complain about. Case in point, Dish must now
disable the Dish Hopper feature for CBS owned programming, per their new
licensing deal set last week.
>
> You are having to pay more, and more and more, because you are not
> demonstrating demand elasticity. Economics 101.
Me and 80% of my peers.
Should I cut the "cord" to me electric supplier because they keep increasing my
rates?
Monopolies exist because of the lack of demand elasticity Bert.
Last night I met the owner of an innovative company called Veterans Energy at
the brewery. They resell electricity to both commercial and residential
customers in Texas - a portion of their profits go to veterans, hence the name.
They have partnered with a local company, Infinite Energy, which has grown
rapidly selling natural gas contracts to distributors.
The markets for natural gas in Florida are now open and competitive, except for
the count I live in, where our local government utility, GRU, owns the
distribution rights. As you would expect we pay more for natural gas here than
customers in the rest of the state. The same is true for electricity in the
area serviced by GRU - we have the highest rates in Florida, thanks in large
measure to a misguided investment in a biomass plant.
Infinite Energy is now trying to get the distribution of electricity
deregulated in Florida, hence their relationship with Veterans. Can you imagine
what would happen to GRU if I could buy electricity at market rates from other
Florida or Georgia power generation companies?
The TV oligopolies exist because the politicians and regulators like it Bert.
And they take their pound of flesh in taxes on these services. The NCTA is
running ads in you market right now Bert, claiming that Title II regulation of
ISP services will add $90 billion in taxes annually.
Tell the government that you don't want to pay taxes because of demand
elasticity.
> And both you and he are saying something that was already possible, for MVPD
> nets, and is therefore **not interesting**.
You are getting way ahead of yourself here Bert. The MVPDs have been inserting
ads in live streams for decades. Only a few, like Comcast, are offering VOD to
their subscribers, and the ad insertion technology is still in its infancy.
> VOD from within garden walls was already available, Craig. It's the garden
> walls that are no longer required. Plus, the congloms have been making their
> content available as VOD for YEARS AND YEARS, Craig. So again, that VOD
> aspect is simply old news.
Most of the content in the extended basic bundle is not available as VOD, or
with dynamic ad insertion as Sarandos suggests. But it is clear that this is
the direction things are headed. What is also clear is that the garden walls
are not crumbling Bert. The FCC is about to allow new MVPDs to build "virtual
walls" around the extended basic bundle on the Internet.
> No, Craig. They will NOT be forced, and you should get this by now? If you
> don't like the Netflix prices, no matter where you live, you can finds
> another TV portal. And no doubt, more to come in the future (like HBO for
> instance). If I can watch HBO over my neutral Verizon ADSL link, which does
> not offer MVPD services, I'm watching HBO with absolutely NO MVPD
> affiliation. Or Hulu. Or the congloms' own sites. Or foreign TV programs.
> Nothing walled in about any of this.
You may be able to watch HBO via your Verizon broadband Bert. But will you Pay
$15/mo for it?
Silly question.
Regards
Craig
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