[opendtv] Re: Amazon Warns FCC About OTT Redefinition | Multichannel
- From: Craig Birkmaier <craig@xxxxxxxxxxxxx>
- To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
- Date: Thu, 17 Sep 2015 08:52:16 -0400
On Sep 16, 2015, at 9:50 PM, Manfredi, Albert E
<albert.e.manfredi@xxxxxxxxxx> wrote:
You have given an example of a conglom willing to create its own web site,
with live streams. Yes, for this, Moonves decided to use the local OTA
stream, but that was entirely up to him. Nothing is chiseled in stone to
force this solution, for Internet linear streams. And contrary to what you
say, Moonves is not requiring any sort of
bundle-which-colludes-with-other-networks, to offer the linear CBS stream.
Actually you gave the example. You also mentioned A&E and ESPN as sources that
might be willing to leave the bundle, despite the fact that both have said they
will not, at least for the next five years.
You seem to believe that the broadcast networks can just walk away from the
affiliate model. But this is where their power, both economic and competitive
come from.
If any of the major networks were to go direct, where would they go?
Clearly you would recommend going a step further than CBS and offering the live
streams OTT. But what would the economic model be?
It appears that the goal for the networks is to charge the MVPDs $2.50 per home
- but this would be shared with affiliates, as are the subscriber fees for CBS
All Access.
IMHO $6/mo is too much for CBS, or any other broadcast network for an OTT
service. But more important than the price, is the fact that it requires people
to CHOOSE to subscribe.
The number of subscribers to CBS All Access is still in the noise. If it was
taking off Moonves would be shouting this from the mountain tops.
Even if a network could get 25% of U.S. homes to subscribe, they would lose
money compared to the MVPD business model.
The only viable economic alternative to the affiliate model would be to become
another MVPD network; this would allow a network to get 100% of the subscriber
fees, and access to about 85% of U.S. homes. But there are downsides too:
1. They would lose the FOTA audience, which is a healthy portion of their
remaining audience.
2. They would lose the political clout of "being everywhere" in terms of
program access, and existing anti-trust exemptions.
3. And they would need to fill all the time slots that affiliates now program;
admittedly they could do this with their library content, expanded news, or
other syndicated content.
So I would not expect any major changes in the next five years, OTHER THAN
working with OTT MVPD services.
In the Internet era, no reason to assume that retrans consent is the only
way, Craig. Or your "the bundle."
See above.
Circling back to square one, no, and that's why you aren't getting the
change. Sling is an OTT site. It carries no OTA broadcast stations, does not
worry about retrans consent, nor is it mandated to carry must-carry channels.
Give it up Bert. Sling is a slimmed down OTT MVPD service.
They have announced the intention to offer the broadcast networks, but have not
been able to put a package together yet.
I believe the reason for this, and the delayed launch of the Apple OTT MVPD
service, is the pending FCC NPRM on MVPDs. Sony DOES offer local broadcast
affiliates, but the service is only available in seven U.S. markets where most
of the stations are operated by the broadcast networks. And Sony IS paying
retrans consent fees.
If the FCC chooses to regulate Internet MVPDs, and I believe they will, the
last major hurdle to real completion between the legacy MVPDs and new internet
MVPDs will be removed. It is highly likely that the FCC will require these new
OTT services to offer local broadcast signals, if they provide any broadcast
network packages.
And some are trying, like CBS. How's that working out for your
buddy Les?
Are his subscriptions are increasing? Then it's working better that the
legacy MVPD bundle, eh?
Who knows if his subscriptions are increasing? More than 85 million homes
access CBS via a MVPD service. Moonves won't say how many subscribers All
Access has, but has hinted it is more than 100,000. The reality is that the
appeal of CBS All Access is VOD access to their program library, and perhaps
mobile access to the sports they are allowed to offer live - they did have a
temporary spike in interest during the NCAA basketball tournament.
Craig! You are so strange! Many people have proven *not* to be the good,
faithful, MVPD servants that you are. Get it?
Yes Bert. I get it.
I also get the fact that 85% of U.S. homes subscribe to a MVPD service.
How many non monopoly businesses in the U.S. have that kind of market share?
"Lucrative business models" are supply side thinking. For that to work, it
depends on an acquiescent, faithful demand side, which can be corralled and
controlled.
It also depends on the willing accomplices in government that have enabled and
sustained this oligopoly. Obviously the demand side is there; the Bureau of
Labor Statistics tells us that the average consumer unit spent more than $2,700
on entertainment in 2014.
You know, people like you, who keep telling us what the MVPDs and what the
broadcasters want us to do. Why do you keep circling back to square one on
this point? The unwalled Internet allowed people to choose other options.
Yes, the Internet has the POTENTIAL to offer new options. I believe the obvious
advantages of VOD and live linear streaming to mobile devices is changing the
landscape of TV.
But the reality is that currently, the most successful OTT services are
additive to the MVPD model. I believe new hybrid live/VOD OTT MVPD services
will be VERY successful, once they get the right bundles in place.
You don't need to mindlessly parrot the ultra conservatives. Telephone
companies have interoperated for more than a century, and totally content
neutral. There has been no serious legal challenge against that, Craig, and
I'm pretty sure Americans would revolt if anyone attempted to screw that up.
Apples and oranges. Title II was a necessary regulatory regime for telephony,
although it led to one of the biggest, most powerful monopolies in U.S.
history. It is inappropriate for the Internet and is likely to lead to a new
powerful ISP monopoly.
What a GREAT argument! I'm so impressed with this logic, Craig. Yes indeed,
let's all emulate what a totalitarian regime would do. Let's allow the ISPs
to filter and replace, and we'll be the ever-faithful servants. Weeeirrd!
It's weird that you do not understand that we have had Net Neutrality WITHOUT
government intervention. This happened because the concept was powerful,
business respects it, and consumers demand it. We have plenty of laws to keep
it that way without letting the FCC turn it into another regulated monopoly.
Funny how that congestion affected only Netflix streams, and how it magically
disappeared as soon as Netflix agreed to some new terms.
Not funny at all. This was entirely dependent on the contracts that Netflix had
with CDNs (specifically Cogent), and the CDNs with large ISPs. The problems
went away when Netflix and the CDNs agreed to new contracts that adequately
provisioned for one of the most demanding, asymmetrical sites on the Internet.
Square one again: The fundamental point is that net neutrality is essential
for the Internet to continue to be what it has been. And the broadband pipe
to your home has no credible amount of competition. So, aside from repeating
ultra-conservative political slogans, Craig, you are unable to explain to me
why a broadband pipe should be expected to remain neutral, only operating on
market forces.
If you want credible competition, don't regulate it and advantage the
entrenched monopolists.
The marketplace can work if it is allowed to. The Internet has become what it
is BECAUSE of marketplace competition. Consumers are capable of understand good
and bad deals. I dropped AT&T DSL service because it was a bad deal.
Circling back to square one AGAIN? When competition for a product or service
is not practical, govt regulations make sense. I'm not "having it both ways."
I've repeated this a zillion times. And I proved to you that it works (cost
of power vs inflation).
Competition IS practical. AT&T is finding a niche with lower cost, lower
performance DSL service. They are giving up on wired broadband because they
understand that wireless is their future. I actually have TWO broadband
services: wired from Cox, and wireless from AT&T. I use AT&T on my phone and
tablet when I am NOT at home, and occasionally at home when Cox is down for
maintenance or other service issues.
Google is building out fiber networks. Municipalities like our GRU are building
networks. But investment has already declined because of the Title II decision.
Regards
Craig
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