Santa Monica, CA
reply to Skippy25
Re: Will you save money?
said by Skippy25:1) The industry is not full of crap. They're in business to make a profit, and absent legislation to the contrary, they are generally allowed to negotiate content bundling agreements, much to our collective dismay.
That is your assumption and the same BS the industry spouts out as though we should just take it at face value.
I for one do not agree for 2 reasons.
1.) The industry claims it and they are full of crap so pretty much anything they say when it comes to consumers the opposite is true.
2.) There are only a few channels that are very expensive that make the entire package expensive that many would not subscribe to. Disney and ESPN channels are just 2 examples.
Regardless, even if I end up spending the same amount or even a little more to get the channels I want that is my choice as opposed to the current forced "choice" we live with now.
Most channels cost less than a dollar per subscriber and can be sold at a dollar given them plenty of profit on them. Assuming of course that they will want to charge more because they wont be able to force the providers into X sub numbers with forced tiering it will cause the channels to be sold at a true market value. This will probably bring the cost up a little per channel. How much? No one will know until it is done, but what we do know is that the channel will charge what they can and we will pay what we are willing.
Let's not forget, ala-carte doesn't mean there don't have to be bundles. They can still bundle based on X channels, themes, channel owners or whatever other creative way they want in ADDITION to having the channels available on a completely ala-carte option.
2) We all know that there is a Sports Tax, which 75% of pay to subsidize the 25%. But industry is very comfortable with that model, and they aren't going to change it. Even Google forces its KC subscribers to pay for it.
You affirmed my point - industry isn't going to permit "ala-carte" unless you and I pay more than ARPU not less. That can work, if and only if they let us choose 2nd- and 3rd-tier channels that we currently have to buy in bundles, likewise for premiums.
The figures that you cite are meaningless. Sure, MDU/bulk/headend, CATV and satellite pay $.10/drop/channel for some channels, others are $1. That doesn't carry over to ala-carte - where rates would have to at least 3-4x more or greater to be revenue-neutral to the content seller, plus cover the additional customer service overhead for channel delivery and billing management.
Industry is NOT going to abandon the last-mile guaranteed bulk revenue for the headache of direct-to-consumer sales, via IPTV, OTT or the Roku channel store.
Under normal conditions, "greed" would drive them to do so, but they all know the pitfalls of taking responsibility for delivery of streams in a net-neutral world and doing customer service, all the while netting less revenue.
Crappy as it is, CableCo has a pretty good handle on customer service and repair. Do you really want to talk to Santa Domingo, Cebu, or Mumbai when you can't stream Matlock?