[opendtv] Re: Distribution outside of "the bundle"
- From: Craig Birkmaier <craig@xxxxxxxxxxxxx>
- To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
- Date: Sun, 14 Dec 2014 09:48:31 -0500
On Dec 13, 2014, at 8:06 PM, Albert Manfredi <albert.e.manfredi@xxxxxxxxxx>
wrote:
>
> Craig, broadcasters have no "monopoly" on the MVPD media.
Not true. The a FCC requires their carriage in the most basic tier. Only DBS
subscribers have the option to pay for local stations... or not.
But this still misses the point. Broadcasters get virtually free spectrum in
return for the delivery of content in the clear. They get paid (by advertisers)
based on the size of the audiences each program delivers.
For decades they were more than happy to allow CATV systems extend their reach,
without demanding payment for their signals. Less popular broadcasters were
more than happy with the FCC Must Carry regulations, that assured they would be
carried on MVPD systems, without compensation. It was only after the MVPD
systems started to offer competitive content, and charge subscribers small fees
to help launch these new channels, that broadcasters used their considerable
political clout to force retransmission consent. The rest is history - they now
control the MVPD content we watch and feast on the subscriber fees that the
MVPDs collect for them.
> So this is a totally logical situation. MVPD subscribers *demand* the
> broadcasters' signals inside their MVPD walled-in distribution pipe. The
> MVPDs charge subscribers to be connected to their infrastructure (as Aereo
> did). THEREFORE, the content owners, in this case the broadcasters, see that
> it is their content luring in these heavy spenders, and they want a piece of
> that action.
I am not demanding the broadcast signals. I can use an antenna to watch the
very limited number of hours of broadcast content - mostly sports - that I do
watch. And I am not demanding a large portion of the channels I receive from my
MVPD service.
But the politicians and the oligopolies make demands that we cannot control,
except to just say no. Such is the nature of monopolies that control popular
services.
>
> You have a problem accepting a basic tenet of US microeconomics, Craig.
> Owners of content (or whatever item), who sell their product or service, set
> their rates according to what the demand side is willing to pay. A Chevy
> rebadged as a Cadillac sells at higher prices.
The basic tenets of US microeconomics are not applicable to monopolies.
A Cadillac is not a Chevy.
> Which is why, when you go on and on about politicians, I end up reading "bla
> bla bla." You cannot ascribe some totally tangential excuse like that, when
> the main reason for things being as they are is so obvious. In this case, the
> blame goes mostly to the sports fans. And also people who got lured in some
> years ago, and lack the imagination to break out. (We've talked about this
> already. People who can't wrap their brains around the fact that just maybe,
> you can watch TV without having to dial a three digit channel number.)
Give it up Bert. You are irrational. Monopolies are illegal in this country,
UNLESS the politicians and regulators make the necessary exceptions to allow
them.
It is Congress that gives the NFL an anti-trust exemption, not sports fans.
>
>> What if 100% subscribed to the bundle? There would be no
>> ability to grow, and the oligopoly would be highly profitable.
>
> If 100 percent subscribed to both MVPDs *and* to "the bundle," then you would
> not see any Moonves or Skipper trying out anything different. But 100 percent
> do not subscribe to either MVPDs or to "the bundle," and what's more,
> subscribership is dropping. So your "what if" simply doesn't apply here.
>
Never have, never will. You mention economics. Please provide an economic
analysis that tells us at what level of subscribers the Extended basic bundle
is not longer economically viable.
> Let me demonstrate a counter example. A couple of years ago, CBS would not
> put "Person of Interest" on cbs.com. Why not? My guess is, they wanted people
> to watch it only by appointment, or even better yet, to subscribe to an MVPD.
>
> What did I do in response? I just watched other shows. That's "demand
> elasticity." Now CBS has "Person of Interest" back on cbs.com, and they've
> regained one fan.
I don't watch CBS shows. Lost me more than a decade ago.
>
> I see plenty of competition among the congloms, Craig. If CBS suddenly
> decided to shut everything behind MVPD walls, I would replace those shows
> with others.
Of course you would!
Regards
Craig
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