[opendtv] Re: IP-Based TV Will Revolutionize Entertainment

  • From: John McClenny <jamcclenny@xxxxxxxxx>
  • To: opendtv@xxxxxxxxxxxxx
  • Date: Mon, 2 May 2005 08:59:43 -0500

On 5/2/05, Craig Birkmaier <craig@xxxxxxxxx> wrote:
> At 7:02 PM -0400 5/1/05, Manfredi, Albert E wrote:
> >
> >Craig, Craig. You're jumping to another discussion again.
>=20
> Bert, Bert, Bert.
>=20
> I am discussing the real issue at play here.
>=20
> While SBC and the rest of the RBOCS would love to succeed in the
> walled garden arena, they don't have a chance with this approach.
> They are too late into the game and have very little to offer that
> would cause a significant number of consumers to switch from cable or
> DBS. All it will take is a few major content holders to refuse to
> play ball and they will be shut out.

The content providers will sign up - they can charge the telcos
somewhat higher rates than they can charge Comcast and anything they
do to increase their pricing power is a good thing for them.  Plus
they get tighter DRM than the MSOs provide.

The telcos can offer a better user experience than the MSOs, mainly
because they are starting later with more capable STBs and newer
software.

> But they do have a chance to play the ala carte card, and to open
> their "gardens" to the content providers who are being shut out by
> the existing gatekeepers. In time, this could be sufficient to cause
> a seachange in the way consumer buy content. We shall see.

Basically, content providers could buy access to the STB and a spot on
the channel guide, as well as the network capacity to deliver the
content.  Think of it as the equivalent of buying time for a
infomercial, but with real content.  How is revenue generated?  PPV?
advertising?  If advertising, how do we aggregate enough eyeballs to
make it financially worthwhile to support the ad sales and creation
process?

I don't think that telcos will go to a pure ala carte strategy - it
makes the initial ordering problem really hard in even a 300 channel
lineup where the core offering is equivalent to an extended basic
cable offering.  I do expect more granular bundles that cable offers.

Plus, adding additional content makes it harder to find the content -
even the limited content that my Time Warner cable supplies is
difficult to search - kick that up to 1000 things to watch and the
search problem gets nasty on a TV set.

Doc
 
 
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