[opendtv] Re: Starz and Altice Struggle to Reach Carriage Deal
- From: Craig Birkmaier <brewmastercraig@xxxxxxxxxx>
- To: opendtv@xxxxxxxxxxxxx
- Date: Tue, 02 Jan 2018 06:17:06 -0500
On Jan 1, 2018, at 9:00 PM, Manfredi, Albert E <albert.e.manfredi@xxxxxxxxxx>
wrote:
Monty Solomon posted:
http://variety.com/2017/biz/news/starz-altice-carriage-agreement-deadline-1202650309/
I just love it when these silly squabbles come out. Yet more proof of the
wonderfully "innovative" ideas the current FCC Chairman has in store, for
broadband service. The article makes the point that Starz is asking for more
than they get as a stand-alone service?
The FCC is not involved in any way in this dispute Bert. And Net Neutrality
rules have no bearing on this dispute either. This is the marketplace at work...
The simple issue in play here is that Starz wants Altice to pay more for the
service than a customer pays if they subscribe directly to the OTT version of
the service. By way of comparison, HBO Now costs the same as the version
offered by MVPDs, but the MVPDs have some pricing leverage, and often include
HBO in promotional bundles to attract new subscribers.
Altice has every right to reject the pricing that Starz is trying to exact from
their subscribers. The subscribers can buy the service cheaper direct.
This may well be one of those defining moments - the inflection point - where
traditional business models are disrupted. But Starz has heavy competition in
the OTT subscription market - makes one wonder why they would risk losing the
subscribers at Altice?
What percentage will continue to pay for the service direct, versus being
buried in their MVPD bill?
And what percentage of existing Starz subscribers at Altice do not have the
required broadband service needed to use the OTT service?
Should they pay more for the content from Altice, than someone who subscribes
directly, but is ALSO paying more than $50/mo for broadband?
These are issues that the marketplace - not the FCC - must resolve.
Assuming this is true, BECAUSE THEY CAN. Duh! If enough luddites complain and
write their congressmen, they'll likely get away with it.
Really? What will they complain to their Congress person about?
This is not a Net Neutrality issue.
It is not a retransmission consent issue.
Even the FTC has no role here, as there does not appear to be an anti-trust
issue involved. I suppose that Altice could go after Starz for anticompetitive
behavior, but that would just make the lawyers rich.
These are shenanigans the legacy gatekeeper systems practically beg for. On
the other hand, carriage on OTT sites gives them religion. There are plenty
of OTT sites out there, available for everyone in US territory, if not
beyond. Oh, only if net neutrality is mandated, of course.
What does Net Neutrality have to do with this Bert. Are you claiming that
Altice could block the OTT version of Starz for its broadband subscribers?
If they did that the FTC would go after them in a nanosecond. And in most of
the markets Altice serves there is real competition for broadband.
Some people, regrettably the FCC Chairman among them, seem unable to think
beyond the 40 years old MVPD monopolistic gatekeeper model. Allow the ISPs to
play favorites, and this ridiculous state of affairs will pollute Internet
service too. How innovative!
Earth to Bert - the Internet is already “polluted” with more than 200
subscription based services that generated $9.4 billion in revenues in 2017
according to the USA Today article. (Note that in my previous post I used the
projected 2019 revenues when I compared OTT revenues to the 2015 MVPD
revenues).
ISPs are not playing favorites with the OTT services; they are competitors, as
is clear in this case. Altice can just walk away from their relationship with
Starz. We may see many more similar examples in 2018.
The question for Starz, is simple. Can they make more money going direct to
subscribers than they make using the MVPD services for distribution?
It will be interesting to see how this plays out...
Regards
Craig
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