Powell Blames Content Companies For Cable's Inflexibility
Now Excuse Me While I Cap Your Connection to Make Netflix More Expensive...
Former FCC boss turned cable industry top lobbyist blames content companies for the pay TV industry's inflexibility when it comes to giving consumers what they want. In an interview with The Verge
, Michael Powell covers a number of topics, from the cable industry's subsidizing of HBO, to the industry's slow and clunky shift toward IP-distributed content. But it's the inability of the cable industry to give consumers what they really want (cheaper, a la carte content anywhere, anytime) that forges the lion's share of the interview -- with the content industry getting all
of the blame:
We should be clear about something: cable companies are at the mercy of content companies on the issue of content rights and use. Time Warner Cable and Comcast have to go into the content market, pay Disney, and negotiate how and in what way they can use that signal. You see them pushing very hard to iterate their experience and get on devices like the iPad and iPhone. Can I put the guide there? Can I put the content there? Can I stream a linear stream? That problem is never technological they can do that and a lot more very quickly. The issue most frequently is licensing rights.
While it's certainly true there's an endless list of incredibly stupid decisions made by content companies that hamper innovation and TV evolution (their suit against auto-ad-skipping DVRs being only the latest
), Powell's pretense that the cable industry is blameless in this stagnation is fairly adorable. This is, after all, a cable industry that historically fights disruption, competition and innovation on every front. While the content industry deserves plenty
of blame, they're not the ones imposing unnecessary bandwidth caps and per byte overages on broadband connections to thwart Netflix, making it more costly for consumers.
Cable has plenty of responsibility for pay TV's stubborn refusal to change, and it's because (even with ugly retransmission fee disputes and obnoxious sports channel programming price hikes) everybody involved is making gobs of money, with consumers obliviously and happily paying bi-annual rate hikes. Only after customers start fighting back with their wallets will things really change, something Powell of course has no interest in acknowledging. The former FCC boss goes on to pooh pooh a la carte pricing, and justify HBO's resistance
to offering direct streaming services:
Remember, Game of Thrones exists because someone else is subsidizing it heavily. If the old guys with cable boxes didnt exist, neither would Game of Thrones, and neither would the pirating. If we looked at what that show costs in production, we would be stunned...I challenge people to to trace the money. Game of Thrones doesnt come out of thin air.
To suggest Game of Thrones wouldn't exist without the current cable model is a fairly amusing dash of hubris, reminiscent of the RIAA's similar legacy-mindset claim that music simply wouldn't exist without them. Powell does his very best to portray himself as a real visionary and risk taker throughout the interview, when in reality he's a rather status quo
sort of fellow; his FCC legacy largely consists of blindly hyping broadband over powerline technology
despite its significant interference issues.
Ok While he talks up that Cable Companies want to have the content everywhere "3 Screens" if you will. He tosses the blame on the Content/Distributors that they cant because of licensing. What he fails to add is that most would be ok with it being viewable everywhere......for a fee, which the Cable Companies balk at, they feel that they should pay once for the rights to use the content/stream and then use it how they seem fit, via On Demand, "Live" Airing, View on Xbox, View on Mobile Devices/Phones, ect. Fact is the content people their stuff to reach as many people as possible. What they don't want is it being paid for by one person, who then shares that with everyone he knows "illegally".
Cable companies then try to reach a middle ground with things like HBO Go, requiring you to sub to HBO to access, and having that app phone home to make sure you didn't just sign up for one month then cancel and still have access. Price it the same as HBO monthly sub and now its a matter of HBO getting the whole fee vs the cable co taking a cut, and that's why they wont do it. Lets say it cost TWC 10/month to offer HBO, and we get charged 15/month, TWC is the one blocking you having HBO as a stand alone product bc they want that 5/month profit, while HBO is like sweet we just made 5/month more and don't have to deal with uplink issues at the cable company.
Re: Ok He also fails to mention why cable is higher than DirecTV and Dish* and why its higher than U-Verse in most areas? After all they both have to go to the same companies for those rights.
Re: Ok cable has higher box fees then the other guys.
Re: Ok Very true! TWC MidWest, LLC now charges $9 per box for new customers, and is required to receive any channels, including the locals. Gotta love it!
| |The LimitPremium
This single line... "Time Warner Cable and Comcast have to go into the content market"
No they don't.
Re: This single line...
said by The Limit:Agreed. They need to just become the dumbpipes they truly are.
"Time Warner Cable and Comcast have to go into the content market"
No they don't.
| |The LimitPremium
Re: This single line... The fact of the matter is "nothing to see here". We've already heard these words before by other "experts" in the field.
Monopoly or duopoly can't front off content providers? Please....
Make that "monopsony: or "duopsony." Result is the same. Where else are these horrible, blameworthy content providers going to go to sell their stuff in the huge markets ruled by the cable companies?
| |pnh102Reptiles Are Cuddly And PrettyPremium
Mount Airy, MD
He's Sorta Right This problem isn't helped by the increasing vertical integration in this industry. For example, Comcast as a cable TV company should not be allowed to own entities like NBC Universal and the various sports networks that it currently owns.
If you want to shake things up, start here.
USA 2012 - the mooches won.
Palo Alto, CA
Re: He's Sorta Right Except Powell doesn't want you to notice THOSE content providers.
There's a reason why these industries are referred to as cartels.
Elephant in the room I was disappointed that the interviewer didn't ask him how he justifies the revolving door of former commissioners becoming lobbyists for the same industry they are supposed to be regulating. It's disgusting to even think about.
Palo Alto, CA
Re: Elephant in the room It was bad enough that while he was FCC commish, his idea of competition was one cableco, one telco, and one satco, and those were all the American consumer needs for "healthy competition". He was a joke then and is a joke today. He's probably an embarrassment to his dad.
Doing Us A Favour The content producers and distribution channels (subscription and OTA) are actually doing my wife and I a favour by keeping their collective head firmly buried where the sun don't shine. We've never had subscription TV--regarding it as too expensive for what you get. The content on commercial OTA TV has become so universally poor we watch little of that, anymore, either. (We added it up the other night. About three hours of commercial TV per week, this season. That's it.) Most of our TV time now is PBS, Netflix and the occasional DVD or BD rental. In total, tho, I'd say we're watching TV far less than in years past. I regard this as a Good Thing. So keep it up, industry.
Re: Doing Us A Favour PBS has as many commercials and other tv...they call it sponsorships and fund drives.
Re: They have a right to protect their revenues Net Neutrality???? Where? The guidelines that the FCC published was just that. They were unenforceable guidelines. The courts even ruled as such as the FCC gave up their right to regulate the Internet a long time ago when it decided the Internet was an Information Services and NOT a communications service to deregulate DSL and next generation networks, also with the Brand X case.
And what is funny is you are in favor of breaking up these companies, but yet many of them brought you what you have and you brag about the one being the highest power---Verizon?? How can you want to destroy their business while loving them at the same time?