[opendtv] Re: Freeview business model

At 5:59 PM -0500 1/29/07, Manfredi, Albert E wrote:

This is the difference between the Freeview model and the OTA scheme we
have here. Your association with BE is much more similar to what
broadcasters do here with their affiliates and with the cable companies.
What difference? In both cases (U.S. and Freeview) the content is "primarily" paid for from the advertising revenues that can be generated. The only difference here in the U.S. is that broadcasters now expect to receive significant ADDITIONAL compensation from subscriber fees. 




 The reason content networks are paying to get their content
 onto Freeview is obvious. They can control how they use the
 channel(s) and keep all the ad revenue they generate. Bottom
 line, if you can generate more revenue than you pay to Freeview
 for carriage, you should make a profit.


So why don't you work that with BE? Pay them a fixed fee, and see if you
can't increase your profit?
That's an interesting idea, however, it is not their business model. They have the infrastructure to sell the advertising - my leverage is how well I can attract readers, and advertisers that request placement adjacent to my columns.
Thanks to Internet distribution I "could" go direct to the customer and sell advertising. I have given this some consideration, however, the potential "rewards" do not seem to justify the effort. 



My point was simple, and I think you missed it. Either model can work
just fine. Either you pay BE, as in Freeeview, or BE pays you, as in
cable and DBS in the US. There's no reason to ask that question over and
over, Craig.
No Bert, you are the one who is missing the point. The Freeview model is the same as the U.S. commercial broadcast model, with the exception that broadcasters each operate their own facilities in the U.S.
Both provide access to viewers for content producers. Both generate revenues via advertising.
What is different here in the U.S. Bert, is that government regulation of the TV industry prevents the marketplace from operating, with the result that multiple entities are skimming significant additional profits off the top of a highly profitable business. These entities include Local, State and Federal governments, broadcasters, muilti-channel distributors, and the content oligopoly. Even with "State Support" of TV in Europe via TV set licenses, U. S. viewers pay SIGNIFICANTLY more for TV than viewers in Europe (except for the small percentage of viewers who accept an inferior OTA service with limited program selection. 

Regards
Craig


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