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Cablevision's Anti-Bundling Suit Against Viacom Will Proceed
by Karl Bode 09:46AM Monday Jun 23 2014
Back in early 2013 Cablevision sued Viacom, claiming that the broadcaster practice of forcing cable companies to carry bundles of channels violated antitrust law. "The manner in which Viacom sells its programming is illegal, anti-consumer, and wrong," Cablevision said in a statement at the time. Viacom's efforts to have the case dismissed this week ran into a brick wall, with a Manhattan court Judge ruling that Cablevision has provided enough evidence to "support plausibly an inference of anticompetitive effects."

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goalieskates
Premium
join:2004-09-12
land of big

1 recommendation

A step in the right direction

Good. Companies like Viacom have gotten away with this for far too long.

I'm just sorry my cable provider knuckled under to these bullies.

battleop

join:2005-09-28
00000

Re: A step in the right direction

It won't matter. If you have to bundle 10 channels for $10 the are going to just make you pay $5-10 for one channel. Viacom will see to it that they won't loose a dime.
--
I do not, have not, and will not work for AT&T/Comcast/Verizon/Charter or similar sized company.
Network Guy
Premium
join:2000-08-25
New York
kudos:2

1 recommendation

Re: A step in the right direction

Pretty much.

But one can hope people stop being frivolous and vote with their wallets for a change.

Yeah...... I know...... Fairy tales....

AnonEM

@166.137.101.x
Cynical, but true...they will just raise the rates for the channels people want.

However, breaking bundling does give the subscriber a bit of power and may improve programming if the network has to compete for eyeballs. No more marathons of crummy reality TV all weekend (I am looking at you Discovery Networks).
tmc8080

join:2004-04-24
Brooklyn, NY
Reviews:
·ooma
·Optimum Online
·Verizon FiOS

Re: A step in the right direction

The subscription to blocks of channels will see a declining base as on demand programming shifts by the way content can now be consumed via broadband. The more these companies fight over the crumbing business model (making the lawyers rich) the faster the decline will become. Content providers & resellers must come to terms with the way consumers want their content. Companies have crammed far too much advertising and revenue pumping schemes (rate increases to both advertisers & content subscribers) into their channel subscription model to keep it viable. The number of consumers who want to pay $50, $75 and more for just video content is dwindling by the year because of these and other reasons-- one of which is the ability to get the paid content for free on the internet (aka piracy).
Skippy25

join:2000-09-13
Hazelwood, MO
You have absolutely no proof of this and are purely speculating a bad outcome because that is what you would want to support your view.

I personally see them placing the correct current value on the products according to how they arrived at that $10 price to begin with.

I then see in the future that the demand of users, thus the demand by the cable providers setting the actual cost per market conditions. Which is exactly how it should be anyway. Therefore, they will get a price that is much closer to market price and if they attempt to charge $10 for a channel that consumers don't want or have little desire for, then the cable providers are not going to buy it and that price will come down to a point that the market will support it or that channel will go away, as it should at that point.

That is exactly what will happen in the real world.

battleop

join:2005-09-28
00000

Re: A step in the right direction

Do you honestly think for one second that they are going to roll over and take a loss in revenue? Absolutely not! They will find one way or another to stick it to the consumer.
--
I do not, have not, and will not work for AT&T/Comcast/Verizon/Charter or similar sized company.
Skippy25

join:2000-09-13
Hazelwood, MO

Re: A step in the right direction

Gotta love your constant doomsday attitude.

Do I think they will just rollover? No, but they will if that is what the market dictates or they will need to be more creative in maintainingor raising it.

For all you and I know, Mr. Negative, they may make a lot more in tis business model.h

battleop

join:2005-09-28
00000

Re: A step in the right direction

Why would they fight this if they could make more money at it?
Skippy25

join:2000-09-13
Hazelwood, MO

Re: A step in the right direction

Being they are so short sighted and afraid of change, yes they would.

You are the prime example to your own question. You without question assume that they would make less money and have absolutely no facts to base it on. So with absolutely nothing to support your claim, you come here and lay it down as though it is fact and proven science.

For all you know, they may get to actually charge more for all the channels individually combined than they currently do as a single bundle because the true consumers (subscribers of the cable provider) have spoken and are willing to pay more than what they are currently getting for them. They may even get to lower their expenses by eliminating unwanted channels while still charging the same if not more based on other demand. You simply don't know how the market will react so stop trying to act like you do.

In the end it doesn't matter. If they courts reject the claim by the cable provider all this is for nothing and the content provider wins out again. However, if the courts uphold their claim then the Viacom's of the world will bend over to the consumers demand exactly how the consumer wants them to as they should and that is regardless of whether you, I, their CEO or their other stock holders like it or not.
houghe9

join:2008-02-27
Lexington Park, MD

not sure

not sure how this is going to help. like it was said instead of 10 channels for 10 dollars they will get 1 or 2 for 10...they are basically going to end up with a smaller channel line up at the same price. how does this help them or the consumer?

ieolus
Support The Clecs

join:2001-06-19
Danbury, CT

1 recommendation

Re: not sure

Choice.
Chubbysumo

join:2009-12-01
Superior, WI
Reviews:
·Charter

2 recommendations

it forces content providers like viacom to come up with content people want to watch that is self supporting, instead of supporting shitty content no one wants to see with content that is popular. Its the reason I dumped cable TV. For all those 158 channels I got, I actually wanted to watch 5 shows, on 4 channels, and 3 of those channels were OTA broadcasts(that were sketchy where I was at the time). Why should so many good channels be forced to subsidize channels that no one wants, like shopping network.
elefante72

join:2010-12-03
East Amherst, NY

1 recommendation

Competition. At first unbundled channels will be expensive, but keep in mind they would have to wind down obligations to contracts (actors, sports) before the race to reality. What would be amazing is that one would see just how much sports contributes to ones cable bill, especially if said person is not interested. I remember when I was younger that being a TV actor was an upper middle class job.

"Unprofitable" channels will move to OTT, and then they will find their niches. If they simply recycle content, they will be the first to go.

People say there will be less choice, there will be more--and they will be more focused and of higher quality to survive. Look @ the weather channel.

The big gotcha of course is caps on internet creating haves and have nots, and that is where payola will fly. DJ's back in the day...nothing new here.

So $50 million dollar players and $2 million per episode TBH is not sustainable forever. If they break the channels watch this collapse.

I remember when music moguls were jetting around...Not so much anymore. That what happens when there is more supply than demand. Bundling is just distorting supply and creating artificial demand. And hence we know why a $200 cable bill is possible.
rfrooney

join:2006-02-26
Antioch, TN
I may end up paying the same amount for fewer channels but at least I won't have to click through 185 sports, shopping and Jesus channels that I don't watch.

Killa200
Premium
join:2005-12-02
Southeast TN

Re: not sure

Its doubtful that your Jesus and shopping channels will ever go away, as those are the ones that are mostly free. Somr even pay commision instead of asking for money to get on the channel line up.
smitty825

join:2013-06-25
I would hope that the "bundles" aren't "all or nothing".

There seems to be 3 possibilities:

1) The person *just* wants to watch a single network (say ESPN). They'd be able to pay for that channel, only.

2) The content providers *could* offer a discount for subscribing to all (or a subset) of channels they offer. That way, the sports fan could subscribe to the entire ESPN family at a cheaper rate than just getting them individually

3) Cable companies could put together their own "bundles" for those who want a more traditional package.

In an ideal world (...and I know that anything that involves media companies and cable companies is never ideal...), we'd have all 3 options available to us, and it would become much easier to "vote with our wallets" on what we want to consume...
aandpdan

join:2013-11-18
Athol, MA
Reviews:
·Verizon Online DSL

1 recommendation

About time

I hope this gets somewhere. While I don't disagree with bundling you should have a choice to bundle or go a la carte, even if a la carte costs a nominal premium.

It is no different than going to McDonald's for a coffee and having to buy a breakfast sandwich and hash brown that you don't want to get that coffee.

Skippy25

join:2000-09-13
Hazelwood, MO

Re: About time

This would not eliminate all bundling, it would simply give choice.

The cable providers can still bundle products based on how they want to market to people. They just wont be forced by the content company to include the channels they say in the bundles they want.

Cable companies can make sports tiers, family tiers, movie tiers, kids tiers or anything else they can creatively come up with to market to their consumers that they know better than the content companies. They can then still offer all channels a la carte so that people like me that may not want all the crap but wants to get say TNT along with locals and Fox Sports Midwest can do just that, regardless of the price.

What if uVerse offered some channels in the basic tier that Charter offers in a higher bundle for more? That is something that would create competition and choice.
elray

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

I hope this gets somewhere. While I don't disagree with bundling you should have a choice to bundle or go a la carte, even if a la carte costs a nominal premium.

It is no different than going to McDonald's for a coffee and having to buy a breakfast sandwich and hash brown that you don't want to get that coffee.

But it won't be a nominal premium.

Once you make discrete channel rentals a retail event, with customer service and billing involved, you remove the bulk pricing opportunity.

I'd still like to see it happen, and let the chips fall as they may.
But don't delude yourself - à la carte isn't going to happen unless it is a profit opportunity for all players.
danj34

join:2006-11-16
Edgartown, MA

Re: About time

Even charging $10 per channel would save me a fortune. I only watch the same 4-5 channels.
Mystic95Z

join:2005-05-10
Sellersburg, IN

The Pot Calling the Kettle Black....

This is rich lol, kinda like how the cable co's force US to buy packages of channels we don't want just so we can get the ones we do....
Skippy25

join:2000-09-13
Hazelwood, MO

Re: The Pot Calling the Kettle Black....

You do realize there are contract obligations that the cable companies must adhere to right?

Yes

@50.182.54.x
said by Mystic95Z:

This is rich lol, kinda like how the cable co's force US to buy packages of channels we don't want just so we can get the ones we do....

The content companies call the shots on bundling, NOT the cable companies.

B1ker

@134.242.92.x
said by Mystic95Z:

This is rich lol, kinda like how the cable co's force US to buy packages of channels we don't want just so we can get the ones we do....

My thought exactly. I'm glad someone else noticed the irony of this. If Cablevision wins, do we get to sue our providers based on the decision
SatManager

join:2011-03-17
North Las Vegas, NV

How to cost manage to the consumer

The Cable Company can provide a package were you can pick a total of 50 channels by picking 5 from Tier 1, 10 from Tier 2, 20 from Tier 3, and 15 from Tier 4 just for an example. That way they can spread their costs out between the different cost points of the channel providers, you can pick the channels you want. It is the best of both worlds. So it will never happen.
firedrakes

join:2009-01-29
Arcadia, FL

Re: How to cost manage to the consumer

come dont fail. but win!

RARPSL

join:1999-12-08
Suffern, NY
said by SatManager:

The Cable Company can provide a package were you can pick a total of 50 channels by picking 5 from Tier 1, 10 from Tier 2, 20 from Tier 3, and 15 from Tier 4 just for an example. That way they can spread their costs out between the different cost points of the channel providers, you can pick the channels you want. It is the best of both worlds. So it will never happen.

When I first got cable years ago, aside from Basic (ie: The OTA stations) I was offered something like a bundle of 8 cable channels from which for the fee, I could choose any 3 to watch. This is something like what is being proposed above. The problem is that in setting up the tiers, the deck can be stacked against the customer by putting too many channels with the same interest together so you can not choose all and are forced to not order some. There is also the situation where the contents of a tier have no interest for you or there are not enough channels you want to meet the order limit for that tier (IOW: You get lots of channels bundled in the tier with only a few you want - just like at present).
BiggA

join:2005-11-23
EARTH

It will be interesting

To see how this all plays out. Something has to change, it's just a matter of what it will be. No one seems to really have a good idea of what that will be... Maybe this will be it.

Bemused

@71.236.98.x

What needs to happen...

Yes, I agree this should happen. However, under the pick your own content, the cable companies will be able to bundle you any which way it sees fit. For example it may let you pick 10 channels from group A. or 5 channels from group B for $20 but absolutely will not let you pick 10 channels from A & B (unless they are all from group A.)

Channel 1-9 may be 0.25, Channel 10-12 is .50, Channel 13 is .75, so they will average this group as .50 a piece. Otherwise the ordering process would take all day on the phone. Group B may be $1-$2 channels.

IMO, if this goes down, it will need to be online only, or make the customer buy in at the minimum rate, then select the channels they want through buy in options on their tv after install.

We probably won't see real promotions. Internet pricing will likely increase so they can recoup their loss, especially in areas where there is no competition. Comcast calls my area, non-competitive and promotional deals are awful compared to where Verizon has built. They know I won't switch to 3Mpbs DSL compared to 105 they are pumping in now. They probably won't want my .50 and gladly let me go to Dish or Direct TV (not that they'd want me either) for my TV content.

We need to see the pricing point Viacom wants per channel, what the operator will profit if it is forced to carry all of them, and if BYOC succeeds, what those prices on both sides will turn into.