[opendtv] Re: B&C: Analyst: Video’s Future Is Omni-Channel Content
- From: Craig Birkmaier <brewmastercraig@xxxxxxxxxx>
- To: opendtv@xxxxxxxxxxxxx
- Date: Mon, 26 Sep 2016 09:44:03 -0400
On Sep 25, 2016, at 10:27 PM, Manfredi, Albert E
<albert.e.manfredi@xxxxxxxxxx> wrote:
Covered this already. The big change, aside from even more library content
(which library content had already been made available pre-Internet-TV, via
in-system VOD), is that TV content comes from a lot more than just the one
MVPD head-end.
Irrelevant. There were thousands of Blockbuster stores once upon a time.
The fact remains that the content owners used the capacity of the MVPD systems
to create new networks filled with their library content. And by adding these
new networks each year it allowed the MVPDs to keep increasing rates for two
decades.
It does not matter how many places you can buy or rent library content - you
can find this stuff at every Walmart, Target, and Redbox kiosk. What has
changed is that you no longer need to leave your home to access this stuff on
demand, and with a relatively affordable subscription you can binge watch to
your heart's content without having to watch a single commercial.
Here's a VERY SIMPLE explanation for Bert:
BEFORE: dozens of channels showing old library content filled with commercials,
and annual YOY rate increases. You cannot choose the specific show or episode
to watch; it's still appointment TV. Or you can get in the car and go rent or
buy what you want.
AFTER: For less than $10/mo. you get commercial free access to vast libraries
of old shows (and a few new originals) that you can access on demand.
What is the trend line, Craig? A smaller and smaller "majority" behaves as
you do, and that is in large part caused by momentum. It takes effort to make
the switch.
Little change.
- Live TV still dominates
- The majority of homes now subscribe to both a MVPD service AND an SVOD
service.
- Cord cutting is stabilizing as the MVPDs are forced to become more
competitive.
You are deliberately changing the subject. Why?
Not changing the subject Bert.
You claim legacy appointment TV is DYING because its audience share is
declining.
I note that the audience share for legacy appointment TV has been declining for
more than three decades, yet the owners of this content are making more money
that at any time in their history.
Nielsen reports that live TV still dominates the time spect watching TV.
To repeat the same old stuff? I said, linear TV viewing has been in decline
steadily, for decades, thanks initially to the VCR. Linear TV is now a
minority of how TV is viewed.
Wrong.
The TV network content is watched by many more people than you think, e.g.
CBS being on the increase, and this is in large part revealed now, only
because Nielsen was ignoring all of the new media in the past!
Nielsen has been counting live/same day, live plus three day and live plus 7
day for several years. Yet network ratings dropped more than 10% in 2015 and
are down again this year.
Covered this way too many times to mention. This is obvious, Craig. Assuming
the decline in ratings is accurate, which is not accurate in some cases,
people such as yourself are paying ever more for this content, whether you
watch it or not. Your loyalty to legacy distribution methods is much
appreciated by the TV networks. They count on you to show growth.
I do not watch the network shows, so I am not contributing to their ratings. I
do watch some network sports, which is a major reason why I still pay for a
MVPD subscription. We have no choice with respect to what we pay for versus
what we watch.
They count on the fact that we are willing to pay and they control the pricing
and business model thanks to their "politically correct" monopoly.
See above. (The better answer is a completely competitive distribution model,
which has been emerging over the past few years.)
Only slightly more competitive. The existing MVPD model is moving to the
Internet, and library content is moving to SVOD services. People are paying
MORE, not less.
If ESPN cannot maintain current revenue levels they may need to do a
better job managing their business. They have no good options,
because people who do want ESPN are not going to pay significantly
more to make up the difference if the free money disappears.
Glad to see that you understood some of my previous comments. Indeed, the
free money is dwindling. What they will have to do is provide their content
without forcing the subscriber to pay for a bunch of other stuff.
We have already seen where the cracks are in their armor and what they are
doing in reaction.
1. Some people love ESPN, but do not want to pay for dozens of channels they
don't watch. Thus we now see Dish Sling offering a way to get ESPN with less
"overhead." And the Dish DBS service now offers ESPN as one of the plus packs
for their reduced cost DBS bundle.
2. Verizon has broken the old model too, offering bundles without ESPN.
3. ESPN has cut loose a number of highly paid commentators to reduce costs and
reduced overall headcount by more than 300.
http://www.businessinsider.com/cost-cutting-is-coming-to-espn-2015-7
According to a report from The Hollywood Reporter, the so-called "Worldwide
Leader in Sports," is currently looking to cut $100 million from its 2016
budget and $250 million from 2017.
There's a lot of other interesting info in this article, like:
According to The Journal, Disney reached a deal with Dish to cancel its
agreement to include ESPN on Sling TV if more than 3 million Nielsen
households — or homes that count for the all-important Nielsen ratings — got
rid of ESPN after May 2014.
According to The Wall Street Journal's sources, this threshold has now been
crossed.
So now the question is: Will ESPN go it alone, offering something like HBO's
"over-the-top" (outside of a traditional cable bundle) HBO Now streaming
offering, or figure something else out?
This is what happens when you get greedy. The next paragraph tells us that to
keep revenues constant, an OTT ESPN service would cost $30/mo. That ain't
happening.
And too of course, tighten their belts. In other words, pay for sports, not
for all the other "the bundle" content. This is what I tried to get across
to you for a long time. And part of the belt tightening is how the salaries
of pro-athletes are reined in.
But that's not happening. The cost of sports rights keeps increasing because
it's the last major bastion of appointment TV. The salaries for "talent" are
not declining, not for athletes, not for coaches, not for actors and actresses,
not for producers, not for politicians...
But this CAN ONLY HAVE HAPPENED because the Internet has now given TV
consumers alternatives to the one monopolistic head-end, for their TV
content. Repeated note to Craig: Internet TV does more than just provide
library content!
It's just another evolution in technology Bert. Very little has changed in
terms of what we pay for TV, and the cost to get TV from the Internet is NOT
going to decline in any significant way. At best, some of the rampant greed is
finally coming to an end.
But that's one of the most important benefits of being a monopoly. You can push
up prices until the pain levels get too high, then moderate a bit, while still
bringing in profits at much higher levels than would exist in a competitive
market.
Look at Microsoft - they are still charging monopoly prices for an outdated OS.
Competitors have stopped charging for the OS. Such is the power of a monopoly,
even as it slowly declines...
like broadcast network TV ratings.
Oh ooops, Craig neglected to mention that "browsers" were up 23% too, for a
daily total of 0.97 of an hour, way more than ANY DEVICE except smartphones.
I did not neglect to mention this Bert. Remember the little factoid about total
media spending reaching $630 billion this year?
We consume media everywhere and have ads forced upon us everywhere - even in a
theater when we pay through the nose for a movie ticket.
But TV is only one component of overall media consumption. And much of the
streaming that takes place in browsers and on new mobile devices has NOTHING to
do with television entertainment.
You are easily persuaded, and thus confused, by the idea that if it moves, it
must be TV entertainment. This is why you keep coming up with irrelevant
statistics.
Is streaming music the same as listening to the radio. In many cases yes, but
radio is still thriving as it adapts to technical evolution. Did I mention the
fact that radio stations now PAY for the music they broadcast and stream?
Craig also neglected to say that daily video consumption accounts for 8.66
hours per day total, of which only 4.52 hours are "live" (supposedly, but
clearly in-home PVR use was ignored).
That is grossly incorrect.
So as always, Craig, you really do struggle with the numbers. The truth is,
we already know from other articles that in-system DVRs are used very little,
for time-shift viewing.
Wrong again, unless you are talking about networked DVRs. DVRs in STBs still a
count for most time shifting.
Pay attention Craig! The Business Insider article Craig is now referencing
lumps all daily online "media consumption" together, be it TV or other video.
Unlike what an earlier article did. So these are the numbers.
Oh boy, here we go again...
http://www.businessinsider.com/how-much-tv-do-americans-watch-2016-6
Total daily hours viewing old-fashioned TV, time shifted TV, and other "media
consumption" (could be Netflix, Amazon, YouTube, etc.): 8.66
Where did you come up with this number?
It's nowhere to be found in the article.
They do say our "Total media consumption" is now 10:39...
Total daily hours viewing luddite broadcast TV streams (but my bet is this
includes in-home PVR use): 4.52
The number for 2016 is 4:31. With DVR time added it is 5:04...
Total hours watching time-shifted TV, Internet TV, and any other "online
media stream," which includes in-system DVR or online: 4.14
Please explain where you came up with this number? There's nothing remotely
close to this in the article. And the numbers they give for smartphones and
tablets include ALL activities, not just video streaming.
So, this article says that 4.14/8.66 = 48% of daily video is being watched by
other-than-linear-stream methods.
Nope. Not even close.
And only just 0.55 hours of that is (presumably) in-system DVR. The article
DOES NOT separate online TV viewing from other online "media consumption."
Since we know that the vast majority of online streaming is not going to be
linear streams, we can deduce that even if in-home PVRs are ignored
completely, about 1/2 of daily video is consumed time-shifted, a tiny
fraction of that being in-system DVRs.
Sorry, but the article does not say this. Not even close.
You really need to spend your own quality time doing the numbers, Craig, so
you don’t come out with absurd statements. Nowhere close to 80% of TV is
being consumed live. (Note: Experience has taught me to keep the numbers
handy, because it will take extreme efforts for Craig to grasp these numbers.)
Bert. This is exactly why your credibility is continuously in question. The
analysis above is nothing less that ABSURD. You're not only misinterpreting the
information, now you're making stuff up.
Wow, Craig, you are so very challenged. You totally ignored watching TV
online. See above.
Where does it break out watching TV online Bert? And no combination of the
numbers provided for each device adds up to what you are saying.
Let's see now. The legacy method charges subscribers more and more each year,
and yet they are suffering substantial losses in annual revenues. I wonder
what that might mean?
As the article reported, they are seeing an increase in revenues. The
relatively small loss in MVPD subscription revenues is more than made up by the
revenues from new SVOD services. This is nothing but a shift in the way TV
entertainment is viewed and paid for.
Bottom line, as a nation we are spending MORE THAN EVER for our TV
entertainment.
Regards
Caig
Other related posts:
