[opendtv] Re: Hulu Orders J.J. Abrams’ ‘11/22/63’ | Broadcasting & Cable

  • From: "Manfredi, Albert E" <albert.e.manfredi@xxxxxxxxxx>
  • To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
  • Date: Wed, 24 Sep 2014 21:10:27 +0000

Craig Birkmaier wrote:

> Exclusive means the only place you can get it BERT.

Get "it." What's "it," Craig? Exclusive can mean that this food store also 
rents videos, making it better compete against other food stores. Exclusive can 
mean that this Internet bookseller includes streaming TV content as part of its 
annual one-shot mail delivery payment, unlike all other booksellers. Exclusive 
can mean that this insurance company only ensures DoD personnel. And so on. You 
don’t HAVE to develop original video content to offer something competitive or 
unique, against the other guys.

> Low cost is not exclusivity - it is price differentiation.

Anything unique to your business is exclusive. If you rent movies at a low 
price, because you're using movies as a loss leader in a food business, you're 
offering an exclusive service. That's called competition.

>> Not to be overly blunt, but did it ever occur to you, Craig, that
>> you "hammer for weeks" on many topics that don't necessarily make
>> a lot of sense? You hammered for years on how great 480p could be.
> And I was RIGHT!

Not only were you incorrect, in the sense that HD is discernibly better than 
480p, especially in the much larger TV screens that emerged since those days, 
but your hammering was also irrelevant. In a broadcast scheme, one to all, the 
only reason to obsess about such matters is if you want to cram more content in 
the channel.

And we can go on at great lengths about any number of other such misconceptions 
and "mishammerings," but it would all be repetitive.

> The MVPD bundling formula evolved from a business imperative -
> charging subscriber fees to help fund new networks that could not
> generate sufficient add revenues to grow.

No, not just that.

The important aspect of bundling is that it works on schemes that cannot easily 
segregate content for separate authentication. With analog one-way broadcast 
distribution, you relied on notch filters or on clumsy scrambling of the analog 
signal. The notch filters were a nuisance to install, because they required a 
truck roll for every single change. And the scrambling was even worse, in the 
sense that each scrambling scheme would require another STB.

So that's why the bundles made a whole lot of sense. It was a way of 
segregating tiers of service, within practical limits of that technology.

Now, obviously the bean counters made the most of it. If I can only "resolve" 
these tiers at a low level, that forces the subscribers to pay for a bunch of 
stuff they don’t want. It becomes an easy subsidy for channels that otherwise 
wouldn't stay afloat, and it also subsidizes more popular channels, by making 
people pay for them even if they don’t care.

Here's the important part: This bundling model is not technically required 
anymore. Programs can now be authenticated individually, if need be. So, new 
entrants in the TV distro market can leverage this, to better compete against 
the incumbents.

John Skipper gets this. Direct to consumer. Not part of a bundle. Content 
owners are free to choose among different business models that might appeal 
more to certain consumers.


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