[opendtv] Re: Reasons for rising MVPD prices
- From: Craig Birkmaier <craig@xxxxxxxxxxxxx>
- To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
- Date: Fri, 28 Nov 2014 22:07:53 -0600
> On Nov 28, 2014, at 5:26 PM, Manfredi, Albert E
> <albert.e.manfredi@xxxxxxxxxx> wrote:
>
> As plenty of articles have pointed out, the only "exclusive" content that
> really holds this "bundle" captive would be the three specific sports I've
> mentioned.
I can only think of one, the Motley Fool article, which is more speculation
than fact. And this was the article that suggested that the "other" content
might leave the bundle, which you mistakenly told us this is already happening.
> The other "exclusive" content is not "exclusive" enough, is available
> elsewhere with sometimes a short delay, does not need to be consumed live,
> and/or is replaceable with very decent alternatives, so this other content is
> having a hard time justifying the increases in "the bundle" fees.
Your opinion.
> And yet, I think you will find that in FACT, it is the main TV network
> content that people miss most from their MVPDs, when it gets interrupted.
> Even if it's also available online and with an antenna.
Not the main TV Network content, but the threat of losing the BEST network
content, like the Super Bowl or the final episode of Friends. And I will remind
you once again that the broadcast networks are not part of the extended basic
tier.
> It's odd how Craig loses the thread. Remember when I said that the profits
> made by HGTV or the Food Network were "fake"? Not supportable in a more open
> market? Remember when you disagreed? I was explaining why to you, Craig.
And I explained why this is so important to them. Of course they prefer to stay
with the bundle as I pointed out again yesterday. Monopoly pricing is generally
not supportable in an open and competitive market.
>
> But also missed by Craig was the main point to all of this. Craig's constant
> obsession about the conglom "oligopoly" is quite misplaced. The only reason
> your cable bill keeps rising is NOT caused primarily by the congloms AT ALL.
> It is caused primarily, and surely I'm not the only one saying this, by the
> NFL/MLB/NBA.
Yeah right. So the NFL/MLB/NBA are getting the $3.6 billion in retrans consent
fees that broadcasters are getting this year; fees that are expected to rise to
$9 billion by the end of this decade?
The total portion of that $80/mo cable bill for basic + extended basic that
goes to the congloms as retrans consent and subscriber fees is now about
$35/mo. Of this, ESPN and other sports networks get less than $10/mo. You
probably will argue that the broadcast networks and TNT justify part of their
subscriber fees based on what they pay for sports rights, which is partly true.
But actors who get $1 million per episode are just as much a part of the
problem too.
>
> At best, the congloms are exploiting the fact that people like Craig exist.
> They won't let go of the monopolistic pipe, EVEN WHEN alternatives for TV
> content exist. Monopolistic pipes can determine the content "bundles" and
> their prices. Craig fails to list credible, non-sports-related "exclusive"
> content by the congloms, available only in "the bundle," that people credibly
> can't do without, because it ain't there.
Pure bull. I did list one example, and there are many many more because more
people watch the content in the extended basic tier than the broadcast networks.
> The most in demand conglom product in the basic bundle, sports aside, is, in
> fact, also available OTA and online. But as long as people demand those three
> sports, and the leagues keep a tight control of it, and as long as the older
> generations demand TV network content be made available behind MVPD walls
> along with those sports, the congloms and the MVPDs can take advantage. And
> why shouldn't they? It's economics 101.
Well at least you understand the economics of monopolies. But you don't have a
clue about what people are watching.
Regards
Craig
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