[opendtv] Re: McAdams On: TV Everywhere, Why Aereo Wins the PR War...

  • From: Craig Birkmaier <craig@xxxxxxxxx>
  • To: opendtv@xxxxxxxxxxxxx
  • Date: Sun, 14 Jul 2013 11:15:03 -0400

Thanks for posting this Bert. For once we seem to agree on many points…

On Jul 12, 2013, at 7:16 PM, "Manfredi, Albert E" 
<albert.e.manfredi@xxxxxxxxxx> wrote:

> "My query then to Aereo is based on their premise that they should be able to 
> retransmit broadcast signals for free: So why isn't their service free? Aereo 
> would be much better off cutting deals with broadcasters to provide free, 
> universally authenticated service versus milking end-users for a few bucks 
> apiece."
> Interesting question Ms. McAdams asks. My answer to it would be, it's because 
> Aereo is not being compensated by the ads as the broadcasters are. Which is 
> also the answer to making schemes such as Aereo legit.

Certainly this is part of the explanation. 

But there is no way broadcasters are going to compensate Aereo - they are the 
ones looking for compensation. The whole point raised in Deborah's analysis is 
that the networks and broadcasters want verification that the person seeking to 
access an OTT version of their content is an MVPD subscriber. Aereo is not 
sharing the revenue they receive for their service with the broadcasters, and 
the viewer may be using Aerreo to bypass the need for an MVPD subscription, 
which is likely to net a broadcaster a buck per subscriber in the next few 

> Nielsen is talking about including online viewing their ratings (or has 
> started doing so). The ISPs themselves could track online TV viewing. So FOTI 
> TV should conceivably be as viable as FOTA is, for any and all content, live 
> and otherwise.

In theory it should be MORE viable. Knowing who is watching is much more 
valuables than knowing how many unidentified people are watching, which is what 
the Nielsen service provides. Targeted ads are generally perceived to be more 
valuable than shotgun mass audience ads. The issue is how to monetize the 
targeted ads. 

From here it seems this problem has been solved by Google and others, who 
routinely target us with ads based on the Internet trail we leave for the 
trackers and the NSA.

At least the potential exists in this space to generate additional ad revenue 
that "could" be shared, much as Pandora is paying for music to sell its 
targeted ads.

> For instance, the TV networks and affiliated broadcasters could treat Aereo 
> as they would a translator station. The broadcasters wouldn't be paying for 
> that transmitter site, instead they pay Aereo. Then Aereo wouldn't have to 
> ask for subscription fees. If the additional eyeballs attracted by Aereo can 
> be quantified, and that part should be well within the state of the art, all 
> of this should be simple enough.

Quantification is next to worthless. It may have a tiny impact on the cost per 
thousand viewers that broadcasters use to set ad rates, but is lost in the 
noise level when compared to the "buck a month" a broadcaster can collect from 
an MVPD service.

In short, there is no way that broadcasters are going to pay a third party to 
deliver their content - but I can see a "compromise" where a third party pays a 
broadcasters a fee for the right to deliver a targeted ad to a viewer.

> Another quote:
> "Rather than a single, simple, universal interface that provides TV 
> Everywhere access to all network content, each network and provider has to 
> have its own."
> I continue to wonder about this conceptual disconnect, on the part of trade 
> scribes and probably consumers too. Would anyone expect all restaurants to 
> share the same site? Banks? Flower shops? Even before TV was on the Internet, 
> there were all manner of different aggregation media from which TV could be 
> viewed (OTA, different cable companies, different DBS companies). With 
> Internet TV, you instead have different OTT sites or portals. I don't see 
> anything surprising or fundamentally different, EXCEPT that over the 
> Internet, all of these different portals are accessible to all (save for 
> artificially-induced geo-location limitations).

I think Bert has the conceptual disconnect here. ALL of the businesses Bert 
mentions DO SHARE several common verification/payment systems - Visa, 
Mastercard, AMEX etc. 

Deborah was describing the problems associated with the MVPD verification 
systems used by every content owner that is requiring MVPD verification in 
order to enable OTT streaming. Bert is wishing for a world where he could 
access all of this content without an MVPD subscription…

A very large disconnect. 

I expect that someone is going to step in and develop a highly secure 
verification system that operates as a third party, issuing a secure passcode 
to viewers; the MVPDs would provide subscriber data to this service, and the 
content owners would use the common passcode authorization system. I suspect 
the main reason this has not happened yet, is that the middleman will want to 
run this business profitably, and the potential customers - content owners and 
MVPDs - would like this service to be free. In the meantime, we have the chaos 
that Deborah describes.

> I really like the part where Deborah talks about "cloud-based broadcast 
> facilities." Why not? I would be surprised if TV stations weren't already 
> started down this path, even if "the cloud" resides mostly inside their own 
> facilities still.

In reality, all OTT services are already "cloud based." The content resides on 
a remote server. Web stores like iTunes or Amazon Prime may download files to 
you rather than streaming them, IF you pay for their service. 

Most of the OTT sites use third party CDNs to stream this content today.

But the notion that you can run an App called "Broadcasting" on remote servers 
is completely logical. We are already seeing this happen with cloud based Apps 
like Google Docs, Microsoft Office 365, and soon  Apple's iWork in the cloud. 
The iWork in the cloud demo a few weeks ago illustrated just how sophisticated 
a cloud based app can be using the full HTML5 toolbox. Deborah tied this 
together with her comments about the Cisco HTML5 program guide. 

A reporter for a broadcaster would need nothing more than a smartphone or 
tablet to produce a story and make it available through the cloud. 

Perhaps the future of "broadcasting" will involve little more than a office 
with a small studio and a few computers.

Who needs spectrum?

Who needs transmitters?

The problem is that most local broadcasters need content, but most content 
producers don't need broadcasters.


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