On Sep 15, 2014, at 2:29 AM, Albert Manfredi <albert.e.manfredi@xxxxxxxxxxx> wrote: > > Craig Birkmaier wrote: > >> There may well be a business in special interest sports portals, >> monetized via advertising. It may be profitable to create ad >> supported portals for sports that are too "special interest" for >> the ESPN TV channels. > > And ESPN is looking into this too. Ain't that a kick in the pants? No. It is a reasonable analysis of the info you provided about the ESPN/MLS ad supported portal. > Also, just today I see that Netflix is expanding to a number of Western > European countries. Didn't I suggest to you that the Internet permits this, > without being shackled to the old models of TV content distribution? Or > should I fetch this too out of the archive? These are NEW ways of doing > business, Craig. Not the same old same old you enjoy dredging up. Nobody is arguing that the Internet is creating new ways of doing business. The content congloms are FEASTING on this opportunity to sell their program libraries to new customers. The argument is related to the preservation of a VERY lucrative business model that has been allowed to grow and prosper in the U.S. - a business model that is now migrating to the Internet. You view the availability of content from the MVPD bundle, based on authentication that you are paying the subscriber fees, as an act of desperation. The reality is that this is adding significant value to the MVPD bundle. This morning I read that Fox News and the Fox Business Channel are now available as live streams to MVPD subscribers. What is even more important is that this is setting the stage for new services that use OTT portals to deliver the bundle, AND VOD access to these programs, something that cable and DBS cannot do easily with their dedicated streaming networks. All that matters is that the lucrative dual revenue streams afforded by "the bundle" survive yet another technology driven transition. More choice for consumers means more customers for the content conglomerates. And yes, the Internet permits global distribution. But you should be careful not to read too much into this. Netflix may well be expanding into other markets outside the U.S., but the congloms are the big winners here. Every new market means Netflix is paying additional rights fees to serve that new market. The losers here are the international broadcasters who also license this content and load it up with commercials. As is the case in the U.S., viewers around the world are: 1. Very interested in watching U.S. made content; 2. Willing to pay for the Netflix subscription to watch this content on demand - WITHOUT commercials. > > This is the repeat from more than a year ago, in which I said: > >>> It is foolish to think that CBS prefers to have customers tied >>> to bundles that include a bunch of expensive ESPN channels, >>> for example, since CBS gets zero nada out of that ESPN >>> overhead cost for customers. They might even lose potential >>> customers that way. CBS benefits from the subscriber fees they get for the content they put into the bundle, and from the retrans consent revenue they get from the bundle. They get this second revenue stream even if people DO NOT watch ANY of their content. Bottom line the bundle is a cash cow for EVERY channel in it. Ad revenues have already peaked, and are now declining for all but the highest rated programs. Subscriber fees are increasing on average 8% per year. >>> >>> The MVPD model, retained to control access to Internet TV, >>> cannot stand long. It's top heavy, cumbersome, unnecessary >>> anymore. You can't assume the consumer is too plain dumb >>> to eventually figure this out. They already are figuring this >>> out. I figured out a long time ago that I must pay monopoly rates for many critical services: Water, electricity, telecommunications, and the bundle. The bundle was never "necessary." It was a response to the tactics used by early cable networks to help fund the huge start-up costs to create content to compete with the broadcast network oligopoly. The networks realized that this dual revenue stream approach would be VERY lucrative and move quickly to control it. First with the 1992 Cable Act that enabled retransmission consent; second by buying up the cable networks and creating new second tier networks to put into the bundle. Would consumers like to choose and pay for channels on an ala carte basis Bert? Can they get it? Markets only respond to consumer desires when they exist. In the absence of market forces, monopoly rents can and do become the norm. > And Craig replies today, > >> ALL OF THIS is your imagination working over time. None of >> this has happened. > > Hey Craig! Wake up! This is what Sony and Viacom are doing. (Do you want me > to post from over a year ago, where I mentioned Amazon instead of Sony?) This > is what ESPN is considering. Waxing loquacious about what happened in TV > decades ago gets sort of boring after awhile, doesn't it? Everybody knows > what happened in the past. We're talking about TV of the future, not what > everyone already knows. We are talking about TV of the present and what powerful oligopolies are doing to control its evolution so that they can preserve their lucrative oligopolies. Sony and Viacom are simply writing the next chapter of this story. Amazon and Netflix are building collections of "used" content they are licensing from the congloms, with a few new original programs to help sell their bundles. Consumers love commercial free VOD; but most subscribe to the bundle for the exclusive stuff like ESPN, just as they subscribe to Netflix to watch House of Card or Orange is the New Black. > >>> Like I said, broader distribution, perhaps even without >>> subscription fee, can end up being even more profitable. > >> Seriously? > > Again, Craig, argue with Skipper. Here's the quote from the NYT article. And > please, READ THESE so you don’t keep arguing in circles: > > http://www.nytimes.com/2013/08/27/sports/ncaafootball/to-defend-its-empire-espn-stays-on-offensive.html?pagewanted=all&_r=0 > > "According to ESPN President John Skipper, they're trying a new strategy in > where they are they believe there could be more profit by engaging digital > content with on-screen ads and a direct-to-consumer strategy." > > What is there not to understand, Craig? The audience Bert. This experiment is related to a sport that does not attract enough eyeballs to generate good ratings and ad revenues on the ESPN channels. As I pointed out, ESPN has many businesses, not just the MVPD CHANNELS. What you choose not to understand is that there is no There, There. ESPN CANNOT expand their audience enough with free ad supported OTT delivery to make up for the $25 billion in subscribers fees they collect each year. > >> Guess you missed that part. > > Sorry, Craig, Forbes' article did not address the fact that 2 out of 3 > non-subscribers used to be shackled to an MVPD. John Skipper gets this. He's > not satisfied even with a 10 percent drop. How is it you don't get this? Because it is unrelated nonsense. Skipper said that a 10% drop would hurt ESPN. He ALSO said that such a drop is highly unlikely. As for former subscribers, there are many possible reasons why they cut the cord. The economy continues to take its toll... > > If it's not the case today, it tends to blindside you, eh? You are trying to extrapolate a future based on a bunch of predictions of what could happen. I prefer to argue based on reality and what IS happening. Regards Craig ---------------------------------------------------------------------- You can UNSUBSCRIBE from the OpenDTV list in two ways: - Using the UNSUBSCRIBE command in your user configuration settings at FreeLists.org - By sending a message to: opendtv-request@xxxxxxxxxxxxx with the word unsubscribe in the subject line.