Bad news for cable companies

[Evil ... Thy name is Orville Redenbacher!!]

Dish is offering a on-line subscription service of dubbed Sling TV, that will launch in a few weeks and include channels from Disney, Scripps and Time Warner's Turner. About 20 channels will be available, such as the Disney Channel, ABC Family, the Food Network, HGTV, the Travel Channel, TNT, TBS and the Cartoon Network."
Oh, and the ESPN tier.
For about $20 a month.


http://www.businessweek.com/ap/2015-01-05/gadget-show-tv-channels-delivered-by-internet-new-tv-sets

I'm going to be all over this.

 

[Big Circus]

Time to jack up Internet prices!

 

[Steak Snabler]

"A la carte" TV has been a long time coming, so let's hope this is the first step. I'd gladly pay a couple of bucks a month each for the 20 or so channels my wife and I watch regularly, and I suspect a ton of other folks would too.

 

[User 11148]

I think a lot of people are over-optimistic about how much a la carte TV will save them. In my instance, for example, I pay about $90 a month mainly for live sports (principally my regional sports network, but also ESPN et al.). Now, my TV provider doesn't get charged $90 by those content companies for that content. I think ESPN/ESPN2 go for about $7 a subscriber, and regional sports networks wholesale for about $2 to $3 a subscriber. So, conceivably, I could get that small set of channels for about $10 a month. The thing is, though, I am already willing to pay around $90 a month to get them. So I doubt that unbundling cable packages is going to lead to my getting those channels at that price.

 

[JayFarrar]

I think a lot of people are over-optimistic about how much a la carte TV will save them. In my instance, for example, I pay about $90 a month mainly for live sports (principally my regional sports network, but also ESPN et al.). Now, my TV provider doesn't get charged $90 by those content companies for that content. I think ESPN/ESPN2 go for about $7 a subscriber, and regional sports networks wholesale for about $2 to $3 a subscriber. So, conceivably, I could get that small set of channels for about $10 a month. The thing is, though, I am already willing to pay around $90 a month to get them. So I doubt that unbundling cable packages is going to lead to my getting those channels at that price.

I read in the Atlantic (Maybe, I don't remember now) that ESPN would cost roughly $30 a month if bundling went away and the regional sports networks would essentially vanish since they don't have year around interest and people willing to pay the money that would be necessary to support.

People like to say that TV is in a golden age right now given the number of high quality shows scattered around smaller networks and I tend to think that's true but if AMC becomes a $15 a month option would you be willing to pay that just to watch Mad Men and The Walking Dead?

So many options exist because so many people pay for cable/dish but when that goes away, the number of channels will have to drop. The numbers aren't there to sustain them.

 

[User 11148]

Here's a fairly sound take on the economics of TV content bundling:

http://marginalrevolution.com/marginalrevolution/2004/04/why_cant_you_ch.html

Consider a simple example with two individuals. John values Disney at $100 a year and FoxNews at $10 a year; Sally has the reverse valuations. Without bundling, the cable company will offer each channel for about $99, and sell a channel to each consumer, reaping $198 in revenue. ...

In lieu of this set up, sell the bundle for $109 to each consumer, reaping a greater revenue of $218. The company makes greater profit.

More importantly, aggregate welfare is higher. In this case each consumer receives two channels instead of one.

Monopolies, regulated or otherwise, tend to bundle commodities when demands are scattered and the marginal cost of additional service is low. In this context, once the program is made, you can sell it cheaply to additional customers. So why not try to get the entire package into everyone’s hands?

You can spin your own numbers, with varying results, but the overall lesson is clear. While there is a general problem with monopoly in the cable market, bundling can make that problem better rather than worse.

 

[RecoveringJournalist]

Doesn't Google have something in the works that's supposed to launch in a year or two that is going to blow cable and satellite out of the water?

 

[trifectarich]

I make my living in sports and I'm not sure I'd miss ESPN if given a choice of what stations and networks came into my living room. I don't watch soccer or the NBA, it's been 20 years since I sat down and watched an entire baseball game, and SportsCenter generally is worthless nine days out of 10.

 

[RecoveringJournalist]

I make my living in sports and I'm not sure I'd miss ESPN if given a choice of what stations and networks came into my living room. I don't watch soccer or the NBA, it's been 20 years since I sat down and watched an entire baseball game, and SportsCenter generally is worthless nine days out of 10.

I went a year without it and I missed it less than I thought I would. Dish did something about five years ago where you had to upgrade your package to keep ESPN. It was an extra $20 a month. When college football season came around, we started to really miss it. I called up and said we were going to cancel unless they upgraded us for free, which they did.

 

[playthrough]

I went a year without it and I missed it less than I thought I would. Dish did something about five years ago where you had to upgrade your package to keep ESPN. It was an extra $20 a month. When college football season came around, we started to really miss it. I called up and said we were going to cancel unless they upgraded us for free, which they did.

Always ask the providers to jump, they'll say "how high?" At the start of the football season our local NBC affiliate was in a dispute with DirecTV and it threatened the season opener of SNF, in which the local boys were playing. Everyone knew the dispute would get resolved in time, but when it was still in doubt I called DirecTV and, bending the truth a little, said I'd cancel if I missed the game. I figured I'd get $20 off a bill or something. They gave me a year of NFL Sunday Ticket for free.

 

[RecoveringJournalist]

Yeah, in May, I called Dish and told them I was going to cancel. They then offered me $20 off a month for three months to stay.

By the end of the call, I got a year at $40 off per month, free HBO/Starz for three months, free upgrade to the Hopper and the Joey, which is the smaller version for the other rooms in the house. Five months earlier, I had called to get The Hopper and was told it would be $200 plus another hundred in installation. I didn't a dime to upgrade.

I'm constantly stunned when I hear of people who call their providers to complain and get nothing. I always get something, usually pretty significant, with pretty minimal effort. You just have to ask for the manager when you get through.

 

[Bradley Guire]

I left Dish becauae they offered me jack **** to stay. I don't miss it. Most things I watch are on Hulu. I don't need ESPN because I use my parent's cable login for WatchESPN. They don't understand Internet TV enough to ever give up cable. And WWE Network is beautiful to me.

 

[Steak Snabler]

Maybe cable/satellite companies won't let a la carte happen. Providers have a lot of consumers, like me for one, by the balls due to live sports.

But it's a good idea and it would work. Record companies took years to come around to the iTunes model, as did movie/TV companies with streaming video, but that's the way of the world now.

 

[JackReacher]

So this is just an online only thing? Can it be viewed on an actual TV?

 

[Steak Snabler]

So this is just an online only thing? Can it be viewed on an actual TV?

Not sure, but I assume you could get a RoKu box or at the very least run it through an auxiliary cable onto your TV.

 

[JackReacher]

Yeah, I guess. I see this appealing to people who haven't spent significant money on TVs. Who sits at a computer and watches live games? People who are used to watching everything on a 50-inch TV probably won't enjoy watching on a 17-inch laptop. I think I read that there's an extra fee for viewing on multiple TVs.

This could be great for single people in their early 20s, though.

 

[Jake_Taylor]

There are multiple ways to watch online content on your 60-inch flatscreen. Roku or Amazon boxes. Apple TV, Chromecast or even just plugging your laptop into your TV with a monitor cable.

 

[JackReacher]

Is all that going to be available with the Dish package?

 

[Jake_Taylor]

I don't know, but if that's the direction Dish decides to push people I'd be surprised if it doesn't create apps for different devices. Some newer TVs you can beam stuff too from your computer, most made in the past 10 years you can at least plug your laptop into and use it as a monitor. So if you were going to watch on your laptop you can watch on your TV. Ipad would be a different story I guess.

 

[User 11148]

Is all that going to be available with the Dish package?

The plan is to let subscribers access the Dish package on streaming devices as well as computers.

Re: those devices. I tried one of those Chrome sticks this past weekend and was none too impressed. That you have to have your smartphone handy to beam the content to it was something I wasn't aware of. My advice is to spend the little bit extra and get yourself a Roku or an Apple TV.