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« HBOI'd save a lot on my cable. »
This is a sub-selection from Subsidies?

mogamer

join:2011-04-20
Royal Oak, MI
reply to longtimecabl

Re: Subsidies?

said by longtimecabl :

No. Having worked in the cable industry for years and having dined with HBO reps multiple times much of their income comes in the form of say a free promotion. If you get HBO free for 3, 6, or 12 mo the cable company uses that tactic to convince people that higher priced packages are a great value (and believe me it works every time) Comcast i.e. still is paying HBO X amount of dollars for their channel. Very, very few people have HBO a la carte anymore. Typically they are part of a bundle or package that includes HBO. Their churn is pretty high since most people a la carte subscribe just for a certain show i.e Game of Thrones and then drop HBO. The cable company promos allow HBO to get recurring revenue throughout the year. i.e. Same thing would happen if it was a la carte. The risk is just too great and makes no business sense. You don't go after the pennies when you have gold bars on auto delivery. Likewise if they did not have this revenue the wild risky shows they do try that end up being amazing would never be greenlit. i.e Girls

Thanks for the explanation.