[opendtv] Re: Why aren't there more converter boxes?
- From: "Manfredi, Albert E" <albert.e.manfredi@xxxxxxxxxx>
- To: <opendtv@xxxxxxxxxxxxx>
- Date: Tue, 30 Jan 2007 11:19:01 -0500
Craig Birkmaier wrote:
> To put this a slightly different way, consider what would
> happen because of market forces if these industries were
> deregulated:
>
> 1. It is likely that broadcasters would make significant
> investments in infrastructure to provide a reliable
> multi-channel service for fixed, portable and mobile
> receivers. And it is likely that there would be a FREE
> extended basic tier.
It is unlikely that broadcast networks would opt for a spectrum utility.
Instead, they would be more likely to want to have control of an entire
nationwide OTA network. Very much as each cell phone company has done,
or the DBS and satellite radio companies have done. Each want to control
a nationwide system, given a chance. Government regulations are what
prevent this from happening, if anything does.
Cable systems, being hard wired like other utilities, would still have
to be separate. It's not easy to have multiple cable systems compete in
the same neighborhoods. So I don't see a major change here.
> 2. Subscriber fees would all but disappear because networks
> would not risk the possibility that consumers would choose
> not to subscribe to them. In other words, we would move
> closer to the Freeview business model, or if you prefer,
> move back to the original broadcast business model, where
> advertising paid for the content.
Subscriber fees would continue to exist for distribution systems that
offer more spectrum than the OTA solution can provide. You pay for the
extra expense incurred for providing you with more spectrum.
We have been over this already, but it seems that 75 percent of
Australians are satisfied with OTA TV, even though they have no more
choice in OTA TV there than we do in most reasonable markets here. (I do
not consider Gainesville to be a reasonable OTA market.) Seems to me
that this "gotta have 250 sports channels" phenomenon exists only here.
If I would conclude anything, it would be that umbillical service
providers in the US are simply more aggressive at offering exactly what
customers want. If you can attract them with a zillion sports channels,
that's what they will offer and charge for. And then make darned sure
that OTA networks do not offer anything that comes close, with any kind
of deal they can make.
This is not government at work. It is private enterprise at its best
(and worst).
Bert
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