[opendtv] Re: Sony To Take Viacom Over-The-Top | Multichannel

  • From: Craig Birkmaier <craig@xxxxxxxxxxxxx>
  • To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
  • Date: Fri, 12 Sep 2014 13:38:00 -0400

> On Sep 11, 2014, at 9:43 PM, "Manfredi, Albert E" 
> <albert.e.manfredi@xxxxxxxxxx> wrote:
> First, in the article you copied, did you catch this statistic?
> "While cord-cutting remains a small but growing threat to the traditional 
> pay-TV industry, 84% of U.S. homes still subscrib to some form of pay 
> television, and 35% of households that don't take pay-TV have never 
> subscribed to a pay-TV service, according to a recent study from Leichtman 
> Research Group."

> The 84 percent is likely overstated, from what we've seen in other articles 
> recently. But the more significant stat is that 65 percent, a comfortable 
> majority, of those who aren't paying for TV are in fact cord cutters. Said 
> another way, 2 out of 3 people who don't subscribe to an MVPD are cord 
> cutters, rather than cord-nevers. I very much doubt that the ESPNs and the 
> Viacoms of this world have missed that stat. Did you miss it?

So you are talking about 65% of 16% which amounts to about 10% of the TV 
audience. And some portion of these dropped MVPD service because of the rotten 

What really matters is the people who have the money to pay for stuff. It's why 
Apple does not care about "market share." They focus on the segment of the 
market with money.

And even as the number of MVPD subscribers slowly declines, the number of 
broadband subscribers is increasing.

Please let me know when the ESPN and Viacom's of the world decide they can make 
more money by taking their most valuable content out of the bundle. 

> So the take-away here is not some broad brush "MVPD migrating to the 
> Internet," but rather that the content owners have come to understand that 
> something more flexible is needed to keep people watching their content. If 
> it were a simple matter of repeating the previous business model on the 
> Internet, quelle surprise, the viewership of pay-TV would continue to drop. 
> Just as ESPN is considering its options, so is Viacom. And just as it's 
> obvious to me that this Internet TV game is different, it seems to be just as 
> obvious to the Dish Network. As I said before, the MVPDs need to reinvent 
> themselves as OTT services.

They are.
> Sony will offer something different from Hulu, Netflix, Amazon, etc. And they 
> will compete head to head everywhere, or at least anywhere in the US. Hardly 
> just "the MVPD bundle OTT."

It certainly looks like Sony is assembling the bundle in an Internet service. 
They are not trying to compete with Hulu, Netflix or Amazon. As I noted in 
another message this morning, the next major change will be the ability to 
access pre-produced content in the bundle on demand. Clearly this "should" be a 
major feature of Sony's offering. But remember, Comcast ALREADY offers a huge 
VOD library...

> TV shows have become the most popular content on Comcast’s video-on-demand 
> service, which overall delivered 2.4 billion hours of VOD across all 
> categories in 2012, up from 2.1 billion a year earlier, according to the MSO. 
> - See more at: 
> http://www.multichannel.com/news/cable-operators/comcast-24-billion-vod-hours-served-2012/325973#sthash.dpuf

The issue here is paying for the bundle.  Nothing has changed.

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