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CBS Rejected Apple Subscription TV Idea
Moonvees Didn't Want to Rock the Revenue Boat
by Karl Bode 08:50AM Monday Mar 12 2012
Everyone keeps expecting that it will be Apple that can shake up the traditional TV industry by offering a cheap streaming TV service, but indications so far are that they're running into the same old licensing roadblocks as terrified TV execs try their hardest to keep things from evolving (particularly on price). CBS exec Les Moonves now confirms he had discussions with Apple and Steve Jobs over a subscription-based TV service, but noted that CBS wasn't interested in such an innovative idea."You know more than me about 99 percent of things but I know more about the television business," Moonves said he told Jobs, stating he was concerned about disrupting CBS' existing revenue streams.

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topics flat nest 

fifty nine

join:2002-09-25
Sussex, NJ
kudos:2

1 recommendation

It's the revenue

Let's face it. $7/month internet TV subscriptions aren't going to pay for big dollar content.

FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5

1 recommendation

Re: It's the revenue

said by fifty nine:

Let's face it. $7/month internet TV subscriptions aren't going to pay for big dollar content.

And doing a deal with Apple is like a supplier doing a deal with WalMart - Walmart gets the profit and the supplier gets the shaft. CBS depending on Apple for a fair deal is ludicrous.

Subaru
1-3-2-4
Premium
join:2001-05-31
Greenwich, CT
kudos:1

Re: It's the revenue

looks like they (Apple) thought the name would of sealed the deal hah

Rambo76098

join:2003-02-21
Columbus, OH

Re: It's the revenue

[GrammarNazi] Would HAVE, not would OF.[/GrammarNazi]


AuraReturn
Premium
join:2003-08-18
USA
said by FFH5:

said by fifty nine:

Let's face it. $7/month internet TV subscriptions aren't going to pay for big dollar content.

And doing a deal with Apple is like a supplier doing a deal with WalMart - Walmart gets the profit and the supplier gets the shaft. CBS depending on Apple for a fair deal is ludicrous.

It's just like how cable companies pay big bucks to keep ESPN and ESPN2 TV only.

Let's face it. If streaming becomes a reality, content companies would have to deal with piracy even more.
--
Ask me about my sites:
bay area jobs Dogs for adoption coupons NBA: »nbaintelligence.com
jagged

join:2003-07-01
Boynton Beach, FL

Re: It's the revenue

ESPN gets $4+ from me per month whether or not I watch it. I wouldn't call that cable companies paying the channel owners
Skippy25

join:2000-09-13
Hazelwood, MO
I'm pretty sure if your statement had any truth at all, then Walmart would be without suppliers.

Simply based on your belief system, why would any company continue business if they can't make money, well the same holds true for Walmart suppliers. If they arent making the money they need, then they will either stop producing the product or they will take their business elsewhere (Im going with option 2 there).

Cheese
Premium
join:2003-10-26
Naples, FL
kudos:1

2 recommendations

Re: It's the revenue

Walmart is killing the small stores, who could they possibly take their business too?
25139889

join:2011-10-25
Toledo, OH

3 recommendations

Walmart is the one that makes out in their stores. The suppliers make SHIT. A simple google search will show you that. Walmart does NOT care about the supplier and tells them how much they will pay for the shelf, how much WM will pay for the product (if at anything- Lay's only gets paid when WM sells a bag) and then yet WM has every right to put those on sale without Lay's approval and can even throw them away if they wish- Lay's takes the hit. NOT WM.

There is a Rolling Stones article from several years ago and it even says WM pays below TEN (10cents) for music CDs and then charges $15+ for them. The same as for anything else.

Not to mention you are REQUIRED to purchase your UPCs FROM Wal-Mart/Kroger's UPC company.
Skippy25

join:2000-09-13
Hazelwood, MO

Re: It's the revenue

Ive watched the documentry and now how their system works.

They are cut throat without question, but my point still stands. Suppliers will not use Walmart if they can't make money and your "sale argument" is BS. Walmart purchases items from these people and then resells them. They can give them away if they want, but the supplier has already been paid so it is WM loss, not the product manufacturers.

Your music CD example is probably very wrong, but even if it wasnt, then the suppliers are still making money (enough to make them happy) or they wouldnt sell through Walmart. It is that plain and simple.

Regardless of what else you through at this, the bottom line still stands. ANYONE and EVERYONE that supplies to Walmart is getting an amount that is satisfying to them or they wouldnt be selling to Walmart. Any of you arguing any other way are talking out of your rears.

Walmart does 2 things I dont like, 1 they require businesses to have an established place in the town of their HQ and 2 because of their cut throat method they encourage companies to use off shore labor.

Did you know that products are made specifically for Walmart for that reason? So that 46" you bought at Walmart probably isnt the same quality build as the one selling at BestBuy for $50 or $150 more. This I know for a fact for when I was an electronic reseller my supplier was required to disclose Walmart sku's to me.

Rambo76098

join:2003-02-21
Columbus, OH
Reviews:
·WOW Internet and..

1 recommendation

Re: It's the revenue

Can't believe I'm saying this, but NWOhio is right. Walmart does dictate the price, and you know what this causes? Outsourcing! Cutting corners! Lower quality!

In order to make money at the prices Walmart forces you to charge, you have to make huge cuts to push the cost to manufacture (+overhead) below the sale price. In manufacturing, you can cut labor or material costs. Lower material costs are obtained by getting lower quality materials. Lower labor costs are obtained by outsourcing.

Believe it or not, but Walmart is one of the biggest causes of outsourcing in the manufacturing sector. In order to survive, you have to outsource to make a profit on the Walmart dictated price.

Don't outsource, and one of your competitors will, undercutting your price, allowing the competitor to offer better prices to the retailers (more profit for them), and eventually you will have nowhere to sell your goods.

There's a reason the Walton family is one of the richest in the world.

fifty nine

join:2002-09-25
Sussex, NJ
kudos:2
said by Skippy25:

I'm pretty sure if your statement had any truth at all, then Walmart would be without suppliers.

Simply based on your belief system, why would any company continue business if they can't make money, well the same holds true for Walmart suppliers. If they arent making the money they need, then they will either stop producing the product or they will take their business elsewhere (Im going with option 2 there).

The walmart model makes perfect sense.

Netflix = Walmart

The suppliers get very little from walmart.

intok

join:2012-03-15
Apparently you don't realize that if you open up some small stores in the area Walmart will lower their prices as far as required in that area to undercut them out of business, the only stores that can survive this are the ones massive enough to actually hold a price war of their own like Kmart/Sears and Target and a few of the smaller grocery companies that can at least get people in by stocking allot more specialty items and regional goods that will draw people in.

Walmart isn't a store, it's an economic death machine.
rradina

join:2000-08-08
Chesterfield, MO
Do broadcast networks need ANY subscriber revenue to create "big dollar content"? Other than the ridiculous retransmission fees, I thought advertising paid their bills.

How much do MSOs pay per subscriber for broadcast network retransmission fees? Whatever this amount is, add to it something for Apple/Netflix/Service X and you'll have what's fair.

Corehhi

join:2002-01-28
Bluffton, SC
Reviews:
·Hargray Cable

Re: It's the revenue

said by rradina:

Do broadcast networks need ANY subscriber revenue to create "big dollar content"? Other than the ridiculous retransmission fees, I thought advertising paid their bills.

How much do MSOs pay per subscriber for broadcast network retransmission fees? Whatever this amount is, add to it something for Apple/Netflix/Service X and you'll have what's fair.

More more more pump every last dollar out of where ever they can get it.

fifty nine

join:2002-09-25
Sussex, NJ
kudos:2
said by rradina:

Do broadcast networks need ANY subscriber revenue to create "big dollar content"? Other than the ridiculous retransmission fees, I thought advertising paid their bills.

Ad revenue is down, bad economy etc.

How much do MSOs pay per subscriber for broadcast network retransmission fees? Whatever this amount is, add to it something for Apple/Netflix/Service X and you'll have what's fair.

As long as you're willing to pay per channel and accept the same amount of paid advertising.

In the end you'll be paying the same amount or more. You think those who work in the TV industry are going to voluntarily take a pay cut so you can watch TV on the cheap? LOL.
25139889

join:2011-10-25
Toledo, OH
9 out of 10 broadcast networks do NOT create the content except for the local "news". They license that content from the actual network who owns it.

The local broadcasters do NOT have to charge retransmission fees; they can force the providers to carry their channel; but yet REFUSE to because they wish to get the $$$$ for their "award winning news". MSOs need to tell those provides to *uck off and walk away. see how well they do then; or do pay them and move their channel up to a digital tier or out of the local broadcast. Due to once they require payment; they're not required to be on a local broadcast tier.

fifty nine

join:2002-09-25
Sussex, NJ
kudos:2

Re: It's the revenue

said by 25139889:

MSOs need to tell those provides to *uck off and walk away. see how well they do then; or do pay them and move their channel up to a digital tier or out of the local broadcast. Due to once they require payment; they're not required to be on a local broadcast tier.

They do that and subscribers leave.

In the end who blinks first? The cable companies don't have an original product. They are for the most part dumb pipes.

Corehhi

join:2002-01-28
Bluffton, SC
Reviews:
·Hargray Cable
said by fifty nine:

Let's face it. $7/month internet TV subscriptions aren't going to pay for big dollar content.

Who says these pickle licker's need to make millions a year?? The people involved in TV make huge amounts of money and that wasn't true back a few decades ago, why should an actor work for 5 years and be able to retiree??/ Why should a producer and a director be able to buy a plane for a few years of work.

My 2 cents.

vpoko
Premium
join:2003-07-03
Boston, MA

Re: It's the revenue

Because they can.

fifty nine

join:2002-09-25
Sussex, NJ
kudos:2

1 recommendation

said by Corehhi:

Who says these pickle licker's need to make millions a year??

They do.

It's their content. If they want to price it to make millions, it's their choice.

You don't have to watch.

The people involved in TV make huge amounts of money and that wasn't true back a few decades ago, why should an actor work for 5 years and be able to retiree??/ Why should a producer and a director be able to buy a plane for a few years of work.

My 2 cents.

Because they can and because you're paying.
stunod2002

join:2003-11-07
Carol Stream, IL

1 recommendation

Re: It's the revenue

BINGO!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

I am so sick and tired of people bitching and whining that stuff like TV shows and Movies (and other things too) cost to much.. If it's to much then don't pay the price and move on!
--
Stunod
TheGuvnor9

join:2006-06-23
Beverly Hills, CA
Do you seriously think it is going to be $7/ month?? Get real! Your premium channels are still going to be worth $$$. Once Apple starts talking to Showtime, HBO, Starz then we really need to be interested. Who the crap cares about CBS??
25139889

join:2011-10-25
Toledo, OH

Re: It's the revenue

Not with Apple. They'll try and under cut to get some more fanboy customers. After all they make their money on their hardware NOT anything else.
TheGuvnor9

join:2006-06-23
Beverly Hills, CA

Re: It's the revenue

Wow, methinks you are just pulling off the curmudgeon card.

fifty nine

join:2002-09-25
Sussex, NJ
kudos:2
said by TheGuvnor9:

Do you seriously think it is going to be $7/ month?? Get real! Your premium channels are still going to be worth $$$. Once Apple starts talking to Showtime, HBO, Starz then we really need to be interested. Who the crap cares about CBS??

Netflix already set the price point at $7/month.

If it's $20/month for CBS content only then it gets to be more expensive than cable, so why even bother.

88615298
Premium
join:2004-07-28
West Tenness

Re: It's the revenue

said by fifty nine:

said by TheGuvnor9:

Do you seriously think it is going to be $7/ month?? Get real! Your premium channels are still going to be worth $$$. Once Apple starts talking to Showtime, HBO, Starz then we really need to be interested. Who the crap cares about CBS??

Netflix already set the price point at $7/month.

Actually it's $8 a month for Netflix. And Netflix can only get you PAST seasons of TV shows not current ones.

If it's $20/month for CBS content only then it gets to be more expensive than cable, so why even bother.

It wouldn't be only CBS.
59677028

join:2012-01-19
Pontypool, ON
said by fifty nine:

Let's face it. $7/month internet TV subscriptions aren't going to pay for big dollar content.

and last i checked technology is about making things cheaper for everyone, kinda like the robots did that make your cars....unions fought and lost that battle....SO SHOULD THE HOLLYWOOD UNION.
elray

join:2000-12-16
Santa Monica, CA
Reviews:
·Time Warner Cable
·EarthLink

Innovative?

What is "innovative" about streaming or subscriptions?

Bring us 2K, with guaranteed / QoS / capless delivery, with buffering algorithms that the user can tailor, targeted ads with a choice of viewing methods, auction-based, resolution-based pricing, charge options (minute, hour, day, week, month, series, network) and payment options that exclude PayPal.

aaronwt
Premium
join:2004-11-07
Woodbridge, VA

Re: Innovative?

said by elray:

What is "innovative" about streaming or subscriptions?

Bring us 2K, with guaranteed / QoS / capless delivery, with buffering algorithms that the user can tailor, targeted ads with a choice of viewing methods, auction-based, resolution-based pricing, charge options (minute, hour, day, week, month, series, network) and payment options that exclude PayPal.

Why exclude Paypal? You would want to include Paypal. The more payment options the better.
25139889

join:2011-10-25
Toledo, OH

Re: Innovative?

because PayPal is worthless and crap. Ever deal with PayPal customer service? Besides on filing a buyer complaint?

Have a read:

»www.google.com/webhp?sourceid=ch···&bih=685

•••••

88615298
Premium
join:2004-07-28
West Tenness

Stupid is as stupid does

When will these morons see that things like this will actually make them MORE money not less and reduce piracy. Of course these are the same idiots that tried to kill off the VCR.

espaeth
Digital Plumber
Premium,MVM
join:2001-04-21
Minneapolis, MN
kudos:2

Re: Stupid is as stupid does

Networks make most of their money through their affiliate system. If they de-value the product they are selling to the affiliate networks by delivering content directly to consumers their revenue stream would dry up faster than end-user subscriptions could possibly replace it.

88615298
Premium
join:2004-07-28
West Tenness

Re: Stupid is as stupid does

said by espaeth:

Networks make most of their money through their affiliate system. If they de-value the product they are selling to the affiliate networks by delivering content directly to consumers their revenue stream would dry up faster than end-user subscriptions could possibly replace it.

Yeah whatever. They tried to kill the VCR because it would kill the industry and kill jobs. Now Hollywood couldn't survive without the home video industry. Hollywood has tried to kill every new technology because that technology was going to kill revenues and in EVERY single case that has turned out to be the exact opposite. EVERY TIME.
jfmezei
Premium
join:2007-01-03
Pointe-Claire, QC
kudos:23

Apple may create its own content

My gut tells me that Apple will say "we tried to get you on board, and you refused, now, watch the power of this fully functional Apple content producing station destroy you to smithereens"

Apple can turn around and commission its own TV series, and have worldwide distribution rights.

More and more, I don't think that TV will evolve, I think it will be replaced by streaming who will develop better and better content while TV will see its revenues coontinue to drop because they won't evolve.
OwlSaver
OwlSaver
Premium
join:2005-01-30
Berwyn, PA

Content Creators will Follow the Money

Right now, the studios make content for ABC, CBS, and NBC for the most part. There is lots of original content being made for HGTV and Discovery but it does not have the draw. Some really good content has already moved to HBO, Showtime, and such.

When Google can get high quality content on YouTube, the switch will be on. Particularly if they can guarantee more money to the content creators. I expect the result to be a very fragmented model where you watch shows on demand on applications on your smart tv. Some will be subscription, some will be pay per view, and some will be advertising supported.

The "channels" and MSO's will not be able to stop it if the money is there.
jfmezei
Premium
join:2007-01-03
Pointe-Claire, QC
kudos:23

Re: Content Creators will Follow the Money

Apple has enough spare change in its savings account that the bank probably had to get programmers to widen the "account balance" field in all its software to handle going from 99 billion to 100 billion.

If Apple wanted to commission the next "Lost" or a new Star Trek series, it could afford to.

If the traditional studios would't want to produce a series paid for by Apple, then Apple can afford to build its own studios and lure the good producers, directors etc away from the legacy networks.

If you produce original content then the legacy networks can't stop you from offering it on-line all around the world.

What is not clear to me is what will happen to Steve Job's share of Disney/ABC. He was able to leverage this to ensure Apple got access to Disney content (which pushed other networks to accept also).

But with his shares no longer owned by the same people who drive Apple, it isn't clear that Apple can leverage that block of shares to its advantage.
sonicmerlin

join:2009-05-24
Cleveland, OH
kudos:1

Surprised No one Else Commented on This

Moonves said he was bullish on political advertising from Super- PACs fueling the bottom line at CBS-owned stations.
"It may be bad for America but it's good for CBS," Moonves joked.

Wow... I don't even know what to say.
59677028

join:2012-01-19
Pontypool, ON

Why doesn't apple

Just start hiring people to make its own shows then. TO heck with HOLLYWOOD....OH right....THEY just about are hollywood.