[opendtv] Re: News: The Real Fight Over Fake News

  • From: "Adam Goldberg" <adam_g@xxxxxxxxx>
  • To: <opendtv@xxxxxxxxxxxxx>
  • Date: Mon, 9 Jun 2008 08:26:42 -0400

Trying to be funny, but the message was lost, I guess.

Disclaimer:  I don't necessarily buy the argument, just presenting it.

(to cover costs only) If ESPN costs $1M to produce and Disney Channel costs 
$100k to produce, then if you bundle them, the total costs are $1.1M and you 
just force each of your 10M customers to each pay $.11.  But if you don't 
bundle them, every family with kids wants the Disney Channel (say 5M of them), 
every one of your subs pays $.05 for Disney.  But only the sports junkies 
(100,000 of them) want ESPN, and each would need to pay $10.

(build in some profit) Because Disney costs nearly zero to produce, but it's 
worth more than $0.05 to consumers, and because ESPN is expensive, but if sold 
a la carte, fewer would subscribe to it at a high cost (like the premium movie 
channels).  But, if ABC/Disney bundle them together (and don't sell them 
separately), they can charge $1 per sub for the package.  $10M revenue on $1.1M.

(yes I completely made up the numbers, and if you look carefully at them, they 
don't make sense)

"They pass the savings on to you" translates into if you wanted ESPN, you're 
paying much less for it than you would have to otherwise.  Disney is free(-ish) 
either way.

-----Original Message-----
From: opendtv-bounce@xxxxxxxxxxxxx [mailto:opendtv-bounce@xxxxxxxxxxxxx] On 
Behalf Of John Willkie
Sent: Sunday, June 08, 2008 9:28 PM
To: opendtv@xxxxxxxxxxxxx
Subject: [opendtv] Re: News: The Real Fight Over Fake News

I've never heard the cable companies saying that they "passed the savings on to 
consumers."  Indeed, I do believe there is extensive evidence to the contrary 
on this exact point ...

John Willkie

-----Original Message-----
>From: Adam Goldberg <adam_g@xxxxxxxxx>
>Sent: Jun 8, 2008 7:10 AM
>To: opendtv@xxxxxxxxxxxxx
>Subject: [opendtv] Re: News: The Real Fight Over Fake News
>
>> With digital cable the cable company can enable/disable channels on 
>> an individual basis via the STB - a critical part of the two-way
>
>Channel authorizations have NOTHING to do with the two-way 'agreement' (if
>there is one).
>
>> the FCC and public interest groups. In essence they have said that 
>> they cannot offer ala carte until every subscriber has a conditional 
>> access box. The fact that DBS cab enable/disable channels on an
>
>Without expressing an opinion on a la carte, I haven't heard this argument
>against it.  What they argue, I think, is that channels are cheaper in
>bundles (for them, and they pass the savings on to you).  
>
>-----Original Message-----
>From: opendtv-bounce@xxxxxxxxxxxxx [mailto:opendtv-bounce@xxxxxxxxxxxxx] On
>Behalf Of Craig Birkmaier
>Sent: Sunday, June 08, 2008 8:05 AM
>To: opendtv@xxxxxxxxxxxxx
>Subject: [opendtv] Re: News: The Real Fight Over Fake News
>
>At 10:18 PM -0700 6/7/08, John Willkie wrote:
>>  If you are able to watch at least one channel that should have been 
>>encrypted, that's simply the problem/fault of the cable company.
>
> From time to time the cable companies put HBO or other premium 
>channels in the clear for promotional purposes. Perhaps the clear QAM 
>version was just a promotion where they removed the encryption for a 
>weekend?
>
>>
>>I kind of wonder how cable is able to charge for digital when you 
>>have access to many digital cable channels when you hook up a DTV 
>>receiver to cable.
>
>Actually, when you subscribe to digital cable on most systems you are 
>required to choose one or more tiers, which you typically pay for. 
>With digital cable the cable company can enable/disable channels on 
>an individual basis via the STB - a critical part of the two-way 
>cable agreement. So you do not gain access to the digital channels 
>unless they program the system to allow you to view them.
>
>Cable has used this argument to fend off the ala carte overtures of 
>the FCC and public interest groups. In essence they have said that 
>they cannot offer ala carte until every subscriber has a conditional 
>access box. The fact that DBS cab enable/disable channels on an 
>individual basis but still offers programming packages says volumes.
>
>THEY COULD EASILY offer ala carte but do not. One would think that 
>they would jump on this opportunity as it is a major CURRENT 
>advantage over cable. But they go along with the same bundling 
>schemes because that's what the congloms want, and they make a little 
>more money too.
>
>Regards
>Craig
> 
> 
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