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Royal Oak, MI
reply to osravens
Re: I'm not dumb, but I still don't understand
said by osravens:Like you mentioned, taking into account all of the free and other promos (Dish was offering all of it's premiums at half off for 6 months) plus the free weekends every other month that HBO/Cinemax have. There must be a tremendous mark-up for the pay-tv providers. I bet a $9.99 stand alone HBOGO would be just as, if not more profitable per sub, for HBO as the current model is.
The real question here through all this is what the cable companies are paying HBO per subscriber.
We've seen those charts that outline the subscriber fees for each cable channel, but they never show HBO, Cinemax, Showtime costs.
Considering how many promotions exist for "3/6/12 months free" of these channels, it suggests to me that there is a massive markup that the people who pay retail subsidize the promos, and that there's so much margin that they can handle that business model.
Here, Atlantic Broadband charges $19.95 per month for HBO. That does not include any West Coast feeds, does not include HBO Comedy or HBO Zone, and only includes HBO HD and HBO2 HD (which is more than any Comcast subscriber in MD can say they have). However, even if I paid for HBO (I don't), I would STILL not receive access to HBO GO as Atlantic Broadband doesn't have a deal with them. That's the real injustice. I can be a paying customer and STILL be locked out of the content.
But I think it shows the real rate HBO gets of that is maybe $5-$6 month, and considering the cost of Netflix, I could easily see charging $10 for the movie and original show library as not only being popular, but profitable, moreso possibly than the cable model.
The biggest problem is that most isp's also sell tv packages. Those guys wouldn't stand still with losing one of their big cash cows.
And boy, is Atlantic Broadband ripping people off. That's the most expensive pricing I've seen for HBO. And you're getting the bare minimum too.
The only suites of premium channels we get the full slates of are Starz/Encore, and that's because they're included with the Digital Plus package (The only digital cable package ABB has).
For Cinemax, we only have Cinemax, MoreMax and ActionMax and it's an additional $16.95 per month from the HBO.
We only have Showtime, Showtime 2, Showtime Showcase, Showtime Extreme and Showtime Beyond, which is all Comcast Mid-Atlantic carries too.
Atlantic Broadband is merely Charter's leftovers that they deemed non-strategic in 2004. All of the territories in MD and Western PA were deemed non-strategic by AT&T when they acquired TCI, and dealt to a shell company that was purchased by Charter within 6 months. We did get D3 speeds last week available here, and those are competitive (20/2 for $54.99, 40/3 for $69.99).
But there's a reason ABB is for sale. And I didn't even mention all the cable channels we can't get, including one of our in-market regional sports networks, Comcast SportsNet Mid-Atlantic.