[opendtv] Re: How the dollars flow
- From: "Manfredi, Albert E" <albert.e.manfredi@xxxxxxxxxx>
- To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
- Date: Fri, 25 Sep 2015 02:10:55 +0000
Craig Birkmaier wrote:
You started saying that the networks could replace local
affiliates with a service delivered FOTI = FREE OVER THE
INTERNET.
If CBS charges for the service, as they do for All Access it is not
FREE.
I'm simply saying that when local broadcasters act as the middleman to get TV
network content on legacy MVPD nets, they are not essential. The MVPD can
directly sell their content to the MVPD. Just like the cable nets do.
On your second point, this second revenue stream you keep
bringing up, that's **so irrelevant to the conglom**!!
It is far from irrelevant Bert. It is billions of dollars and
growing.
You missed it, Craig. The conglom would be compensated regardless. Anyone who
takes someone else's content, and then resells it, can be made to compensate
the content owner. You do not need the OTA broadcaster to get in the middle of
that. It was a convenient way of doing business in pre-satellite CATV days, but
is not needed anymore.
As costs came down, ad rates went up. Most compensation to the
stations came in the form of ad avails in network programming.
Only a small number of stations in smaller markets received
checks from the networks.
So? The conglom deserves compensation, one way or another, when the conglom
high value content is sold by an MVPD. Why should the conglom care how
lucrative the ads are for the local broadcast station? As long as the conglom
is using the MVPD net and not the OTA transmitter, he couldn't care less. For
OTA transmissions, the conglom can easily come up with fair payment.
By the '80s broadcasting was a VERY lucrative business.
Good for them. Now here's the deal. As middlemen for getting TV network content
on MVPD nets, this "very lucrative" translates to unnecessarily bloated MVPD
subscription fees. No problem, this has played a part in declining MVPD
subscriptions.
The role of OTA broadcasters for legacy MVPDs is questionable, since the MVPD
already owns and runs the entire cable plant, and the conglom can transmit
their signal via satellite to MVPD headends. On the other hand, to get local
ISP nets to scale up to more universal use of the Internet as TV delivery
medium, these local broadcasters could carve out a MEANINGFUL new role.
After the congloms got control of 90% of the content
delivered by the MVPDs they went for the cash and we started
seeing the blackout strategy to drive up subscriber fees.
So the idea that the networks should pay the affiliates is
completely out of sync with reality.
Out of sync? You have explained how congloms sell a lot of content to MVPDs,
without involving local OTA broadcasters. Which is fair enough, by the way. You
seem unable to conclude that the congloms can equally well sell their
ABC/CBS/Fox/NBC content directly to the MVPDs as well, also without involving
OTA stations.
Now to the OTA stations. As long as the congloms want to retain FOTA service,
they have two options: either they sell to the OTA stations, same as they sell
to MVPD nets, and then the OTA stations get all the ad revenues. Or the
congloms get all the ad revenues from their network shows, and then they
compensate the OTA stations for their services. Either way works fine. This is
a very old thread on here, Craig.
CBS and the rest are available FOTI too, Craig.
Some programs but not all. And it requires a decent broadband
service that costs as much as basic cable.
Not even close. Already more than 90% of US households have broadband, and the
cheaper variants are well under $50/mo. That's a price the MVPD households pay
on top of their TV channels. Introductory offers for broadband and TV are
around $90 to get people suckered in.
No. Thee are no TVE apps for the broadcast networks/affiliates
that get retrans dollars.
Once again, Craig. If you can get a TVE app to play CBS linear streams on your
Cox TVE, it is **only because** Cox has paid the retrans consent dollars to
your local CBS affiliate. If Cox did not pay retrans consent to the CBS
affiliate, no way would Cox be able to carry that CBS station, either as a
linear MPEG-2 TS stream, or as TVE.
Two quotes from the same article that are 180 degrees out of phase.
Actually, no. The CNET article didn't go into future plans, the Variety article
did.
Sorry, but free ad supported is not the norm for the Internet.
That's pretty hilarious, Craig. The Internet only became the success it is
because the vast majority of its content is free and ad-supported. This formula
was basically invented by TV and radio, and was overwhelmingly adopted by the
Internet, when the Internet first went commercial (1991 or so).
Bert
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