[opendtv] Re: FW: Re: Distribution outside the bundle
- From: "Manfredi, Albert E" <albert.e.manfredi@xxxxxxxxxx>
- To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
- Date: Thu, 18 Dec 2014 00:04:30 +0000
Craig Birkmaier wrote:
> Consumers tend to complain when ANY content they value and pay for
> is withheld to blackmail the MVPDs (in reality the subscribers) to
> increase these fees. This is a classic case of the law of "intended"
> consequences. The MVPDs get to pretend that they are protecting
> their subscribers, and the content congloms get more money.
It's the classic case of supply and demand, Craig. The owners of valuable
content want more money, and they show the middlemen how much their content is
worth. Subtracting content is simply a way to "prove" to that middleman that
their request was reasonable. If no one cared, Craig, you wouldn't see any
protests.
>> Fairly early days for cable, still. That's about when TVs started
>> being sold with their tuners set to cable frequencies **by default.**
> Wrong.
> More than 15 million cable-ready sets have been sold since they were
> introduced in the late 1970's,
Yet another example of Craig's reading acumen. Look again at what I wrote,
Craig, especially the emphasized part you missed. I know full well when "cable
ready" sets became available. Early 1990s is probably about the time when the
majority of TV households became walled in. So it would be about the time the
TV networks, through their affiliates, would raise a stink.
> According to TVB there were 93.7 million TV homes in 1990. That
> means more than 56% were cable subscribers, hardly "just getting
> started."
Exactly as I had estimated. Which is why TV sets were sold with tuners set to
cable frequencies by default.
> Bottom line, the networks were losing their audience and wanted
> in on the second revenue stream.
Pure speculation. It doesn't even matter whether the TV networks were losing
audience (which you'd expect, given the greater choice on MVPD nets). Even if
the TV networks were NOT losing audience, it wouldn't make sense for them to
not ask for a subscription fee kickback, when far less popular channels were
getting one. After all, consumers certainly did want continued carriage of
those TV networks. It's not like they didn't matter. Remember what I said about
a middleman creating an infinite revenue stream, from content owned by someone
else?
> They continue to ask for more, even as some homes cut the cord.
> THAT shows inelasticity in demand.
> And to be fair, before new OTT services began to provide viable
> alternatives to the bundle.
I think Craig is starting to get it! Yes, this shows that there will be a core
of MVPD stalwarts who can be made to pay more and more, and these are the
sports fans. And especially for non-sports fans, alternatives have emerged and
will emerge.
> Apparently your heroes like Skipper and Moonves are not too
> concerned about this trend.
And yet, they are both concerned. Moonves more than Skipper, because Skipper's
viewership can more easily be made to pay more and more. But even he has seen
that 4.6 percent drop, Craig.
>> If that were true, you wouldn't be seeing Tom Wheeler having
>> to consider Title II, Craig.
>
> Really?
>
> The courts are forcing Wheeler to consider alternatives, as
> earlier attempts were ruled illegal.
The courts were basically saying that the FCC could not enforce anything unless
broadband was classified under Title II. That's all, Craig. They were in effect
nudging the FCC in that direction, when the FCC didn't want to go that way.
> Now answer the question Bert. We were not talking about the
> Internet. We WERE Talking about access to cable systems,
No, Craig. I asked you to imagine how cable TV would have evolved, if the
system from the start could support an essentially unlimited number of content
sources, and were mandated to be device-neutral. And your response was that
this was impossible. So I had to remind you that the Internet is just such a
model.
You do not need bundles and you do not need a monopolistic content gatekeeper,
when you have such a model. So, now that the Internet IS available, it's not so
hard to understand why this transition is occurring. That was my point.
> There is no NEED for monopolistic bundles Bert.
There certainly was, Craig, with 1970s cable technology. We already discussed
this more than once (or twice, or three times).
Bert
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