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| reply to travelguy
Re: The basic flaw... said by travelguy:to ala carte pricing is a misunderstanding of how the cable/sat tv business works. Much of the costs are fixed (trucks, customer support, wires, satellites, receivers, etc). Pricing is set by what people (as in on the whole) are willing to pay for video entertainment, not what an individual channel or group of channels cost. This drives business to use a revenue per subscriber model known as ARPU. If these companies make it too easy for subscribers to lower their monthly bill - i.e. going from that $79+ a month to $29/month, they aren't going to be able to generate enough revenue to support the fixed costs... To simply say that if cable companies went to pay per channel pricing that they wouldn't make enough money is a fallacy.
Lets say that if a customer wanted the scifi channel, and they pay lets say $5/month. Fine, the cable company wouldn't be able to make a profit on that because the cost of sending out a tech to hook it up with the fear that he may disconnect at any moment.
HOWEVER, you are missing the bigger picture. What if he was forced to sign, say a 2 year contract, or pay annually for it, that would be a win-win for both sides as now you have the customer and when a customer currently has the service they are more likely to add MORE channels which means MORE profit for the cable company. This is especially in part due to the 2 year contract, the customer would have to make the best of a bad situation by ordering more channels.
I think everyone is missing the fact that people are disconnecting not in part that they can't afford it, that its wayyyy too expensive for what they want to offer you. Currently in the US if you want to watch scifi on Comcast you have to purchase a specific tier of channels; most you probably would never watch. And cable channels seem to have never ending commercials...sorry Comcast I don't want to pay monthly to watch commercials.
And this is a win for consumers as well, as now the content providers can't push the cable companies because if no one is purchasing a channel, then the law of supply/demand comes into play where they would be forced to lower the channel until people are watching it or include it in like a "buy one channel - get one free". However, you have to be careful with that as we might fall into the same package trap we are in now - for example "to get the scifi channel you need to purchase A&E and you get scifi for free" without a way to just pay for scifi.
But hey, Comcast et all, keep digging yourself your grave and not listen to your customers. Your stupidity will be the death of you yet. I could care less, as they just don't "get it". You need to make the content cheap and easy to get. Why do you think bittorrents became the pirates #1 choice? The "pirated content" is easy to get and DRM free. DUH! | |
| said by k1ll3rdr4g0n:To simply say that if cable companies went to pay per channel pricing that they wouldn't make enough money is a fallacy. Lets say that if a customer wanted the scifi channel, and they pay lets say $5/month. Fine, the cable company wouldn't be able to make a profit on that because the cost of sending out a tech to hook it up with the fear that he may disconnect at any moment. HOWEVER, you are missing the bigger picture. Shall we step back to reality for a moment? I just went over to the Comcast investor relations web sit and pulled the following details out of their 2009 annual report:Total Analog & Digital Video Subscribers was just shy of 42M, which is a 1M increase over the 2008 number. Their revenue went up almost 4% as well, so subscribers are not trading down to cheaper packages.
So this idea that Comcast and the other cable companies are bleeding subscribers is not supported by reality.
I didn't take the time to compute the actual ARPU numbers, but it doesn't take a rocket scientist to figure out that it takes more than 16 $5/month subscribers to replace one $80/month subscriber. Given that pretty much everyone who wants cable has cable, there isn't a huge pool of starving students sitting around waiting for $5 pricing. | |
| said by travelguy:said by k1ll3rdr4g0n:To simply say that if cable companies went to pay per channel pricing that they wouldn't make enough money is a fallacy. Lets say that if a customer wanted the scifi channel, and they pay lets say $5/month. Fine, the cable company wouldn't be able to make a profit on that because the cost of sending out a tech to hook it up with the fear that he may disconnect at any moment. HOWEVER, you are missing the bigger picture. Shall we step back to reality for a moment? I just went over to the Comcast investor relations web sit and pulled the following details out of their 2009 annual report:Total Analog & Digital Video Subscribers was just shy of 42M, which is a 1M increase over the 2008 number. Their revenue went up almost 4% as well, so subscribers are not trading down to cheaper packages. So this idea that Comcast and the other cable companies are bleeding subscribers is not supported by reality. I didn't take the time to compute the actual ARPU numbers, but it doesn't take a rocket scientist to figure out that it takes more than 16 $5/month subscribers to replace one $80/month subscriber. Given that pretty much everyone who wants cable has cable, there isn't a huge pool of starving students sitting around waiting for $5 pricing. Are you saying this story is false then?
»Cable TV Losing 1 Million Customers A Year
And in reality, you can spin the number of customers however you want, what you should be interested in is the number of PAYING customers. I know someone who rented a room at a house, subscribed to Comcast, moved out without letting Comcast know, and Comcast never shut off the service. Not saying it was right to not let Comcast know, but still, I'm sure if it happened once I am sure it has happened many times which the numbers the company puts out may not be as reliable as an independent firm (as the independent firm is not biased). Do you really think Comcast would put that they are losing customers on their public website? | | |
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| reply to travelguy
said by travelguy:Shall we step back to reality for a moment? I just went over to the Comcast investor relations web sit and pulled the following details out of their 2009 annual report:Total Analog & Digital Video Subscribers was just shy of 42M, which is a 1M increase over the 2008 number. Their revenue went up almost 4% as well, so subscribers are not trading down to cheaper packages. The problem is, there is *no* cheaper plan.
Analog TV, before Comcast forced the switch to SDV (with box rental fees) was $70/month + taxes!
Before, it used to be $35 a month (probably 10 years ago).
Then we switched to U-Verse.
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