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Canadian Telcos Lobby Against Pick-and-Pay TV
silentbrad writes with an excerpt from the Financial Post: "BCE Inc., Rogers Communications Inc., and Shaw Communications Inc. which together control two-thirds of the $8.3-billion broadcast distribution market, are lobbying against the so-called 'a la carte' model that would allow customers to pick and pay for individual networks, arguing the change would have disastrous consequences for programmers, such as Bell Media and Shaw Media. 'A regulation requiring that all programming services must be made available to consumers on a stand-alone basis would have far-reaching ramifications,' BCE, whose Bell owns 30 specialty networks, said in a submission to the Canadian Radio-television and Telecommunications Commission. 'Undoubtedly, a market shake-out, causing many specialty services to exit, would ensue.' The three big players, led by BCE, have told the CRTC they support the status quo of 'tied selling,' or the practice of grouping weaker-performing networks in with a popular channels, versus a new approach to sell channels individually. ... In the race for subscription dollars, rates for TV services across providers have risen sharply over the last decade as the number of specialty channels, each commanding its own fee, has soared. Net costs to subscribers climbed another 2.6% in 2011, while average bills now hover around $60 a month."
Of course they lobby aginst it..
Nobody actually WANTS to pay for all those shopping, religious nut, cable access bullshit channels.
And yet someone has to pay for them. Because we can't just tell those channel execs 'your channel sucks and nobody wants it, we're dropping it'.
So they stay. And we all get to pay for crap we never wanted.
Why are the popular channels subsidizing poor-performing specialty channels? What's the logic in that? Why is the cable company carrying a channel that's not profitable?
Their argument rings so damn hollow it's ridiculous.
Forget ala-carte channels, much less bundling of channels. The future isn't even in ala-carte series, but rather ala-carte episodes. It is insanely competitive, but with unicast now feasible (and catching on rapidly, e.g. netflix), it cannot be otherwise.
...a market shake-out, causing many specialty services to exit, would ensue.
The raisin de etre for cable tv is specialty service. All that non-sense about buying 'packages' is a way for the company to extort more money from customers.The channels have to put advertising in place to support themselves; They do not get that subscription money, and they wouldn't under a 'pick and choose' model anymore than they do now. But what it would do is force cable companies to disclose which assets are valuable and which are not, meaning those channels could then dictate terms to the cable companies, instead of the other way around; It would be an accurate way of figuring out how many people actually watch your channel, rather than relying on 3rd party services to provide that information.
So no. It wouldn't result in a market 'shakeout'.... and if it did, that's capitalism in action. Don't you support capitalism, oh great Cable TV executive with your very fancy hat? What you're really saying is your profits would be lower because you'd have to be honest about the numbers, rather than being able to use (achem) creative accounting.
#fuckbeta #iamslashdot #dicemustdie
media cartel if customers get to pick their own programming?
It's been around 10 or 11 years now since I stopped watching TV. The ridiculous monthly costs combined with the facts that 2/3 of the channels are uninteresting and those that are are filled with up to 40% commercial time, I just thought to myself one day "Why am I paying for this?"
Since canceling my cable, I chose to watch shows that I was interested in by on-line streaming or by just getting the DVDs, and that's worked out great so far. The added perk is that I'm not exposed to ANY commercials at all. The big Telco's have got to come to the realization sooner or later that embracing the more modern ways of media distribution is a lot more profitable and beneficial than constantly opposing them. They seem to forget that it is the consumer than "wants" the shows, and their job to deliver what the consumer wants, not what they think the consumer wants.
If they don't step into the 21st century soon, more and more folks are just going to do what I did and stop giving them any money at all. Personally... I think it was one of the best things I've ever done; I haven't a clue where I'd find time to sit in front of a TV nowadays.
If it only were a shiny "program" that would come next. It's often shiny only because it's a polished turd :(
A successful API design takes a mixture of software design and pedagogy.
You don't get how it works. The HSN pays the cable companies to be distributed! They are profitable, they have money! They are perhaps the poster child for how it should be done.
A successful API design takes a mixture of software design and pedagogy.
I also ducked out on satellite. It's streaming and over the air local channels with a UHF antenna for me now.
I use a Roku box (actually a couple of them), and have a Netflix and Amazon subscription.
I haven't ever looked back and certainly don't miss all the religious and shopping channels.
With streaming I can do a la carte subscriptions. Cable and satellite need to get with the program or wither and die on the vine.
Most people right now are paying for five channels they don't want for every one they do. Thus, a 300% increase in the price per channel would still be cheaper unless you're one of the few people that actually wants every channel.
-- "So they told me that using the download page to download something was not something they anticipated." - Bill Gates
I want a package with I can get things like Discovery, Syfy, and Cartoon Network, without subsidizing ESPN or any sports channel or religion channel..
If someone is passing you on the right, you are an asshole for driving in the wrong lane.
Oh, they do just fine when they're bundled together with TSN.
The fact is that most specialty channels don't care how many people watch them. They get more of their revenue from subscription fees (being in a package that people take) then they do from advertising to actual eyeballs. Why do you think so many of them just have the same few cheap shows on constant reruns?
-- "So they told me that using the download page to download something was not something they anticipated." - Bill Gates
I agree. This won't go the way people think it will. For proof, just look at season passes on Amazon Instant Video. They charge something like $2.35 an episode (in HD). Season seem to be around 22~24 episodes, so that is somewhere between $50 and $60 for a season depending on the show. Granted that I believe you "own" (in the sense the show will always be available to you in your video library) the show on Amazon instead of seeing it and having to buy the Blu-Ray when it comes out later, but it is still quite the mark up. If you only watch one or two shows and trust Amazon, then it may be worth it, but you are otherwise better off getting a cable package and the disks later down the road (TV seasons go on sale all the time).
For speculation sake, lets guestimate what that will be. I'm sure that the content providers won't charge as high a price as on Amazon, but it wouldn't surprise me if they didn't use it as a basic starting point. I could see them doing $0.50 per week for each local stations (so $2 per month), and $1 to $1.50 per week ($4 to $6 a month) per "cable" station.
If it is that price then for me I would need the local 4 networks (ABC, NBC, CBS, & FOX) at $8, and ten cable stations I regularly watch... somewhere around $45 to $60 per month. Isn't that what I pay now for 30 or 40 channels?
Vol~
I work for a major cable network- here's a hopefully better explanation of why we've stuck with the bundling model.
A cable channel gets its revenue from two main sources- cable subscription fees from the cable provider (~70%) and ad revenue (~30%).
Let's assume we have a cable channel that is currently bundled, and in 100% of households with TVs, with revenue of $100 million a year. We're getting $70 million from cable subscriptions, and $30 million from ad revenue.
Now let's say we switch to a-la carte, but 100% of households still want to subscribe at a price that leaves us revenue-neutral. The cable channel says "great! we're still getting $70 million from subscriptions and $30 million from ad revenue. Everybody wins."
But, let's say only 50% of households would be willing to subscribe, but they're willing to pay double the price because they love the channel. We're still making $70 million from subscription fees. However, we're now only in 50% of households, which means we're much less attractive to advertisers. We're not going to keep making $30 million from ad revenue, because advertisers often need a "critical mass" of households reached in order to make a deal. This isn't a linear relationship- 50% of households doesn't mean 50% of ad revenue, it could mean 0% because we don't have the scale to make an ad deal worthwhile for the advertiser.
So now we've only got $70-85 million a year, which means we have less money to spend on programming. Program quality suffers as a result, and so the next year maybe only 25% of households are willing to subscribe. We're now in a downward spiral.
TL;DR - unbundling has the unfortunate side effect of reducing program quality for specialty channels. Only the cheapest shows (ie, crappy reality shows) or the ones appealing to the lowest common denominator (ie, CBS's entire lineup) might survive in the long-term.
Wow...where do you live in the US where they offer A la carte cable?
I've never seen it offered anywhere I've been in the US....
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
They tried to hide the quality of the channel by simply saying its your personal opinion of the channel, not the value of the channel itself.
So even if you don't like it, imaginary people do. Hence we're giving 28 channels for X amount is a GREAT bargin.
Even if you only watch two of them, other people watches the OTHER channels...so we're giving you VALUE.
No. No you're not. You're bundling cheap crap that people don't want in to justify your prices.
If you tried to charge 30$ for two channels, you'd suddenly seem 'expensive' for what you get.
So you try to hide that and just don't want to be exposed.
Tough shit.
I'd love if I could sell people things and force them to buy other crud, but when it comes to physical objects, can't get away with it as much.
"Ah, I see you wish to purchase this TV, well, the TV is decent, medium level TV, and I realize the price is for a higher quality TV, but look, you get this cheap
living room set that no one wants to buy, so you're getting a great deal really."
No, no I'm not, because I don't need another living room set, and it's worthless, I couldn't sell it if I tried.
I wonder how many of the channels that do make money kickback part of the profit to the cable providers? Above board or otherwise.
This Tuesday. You install it from the store or from the same video channels dialogue netflix is under.
It isn't evil; it's just bundling, and there is a reason for it.
Simple example (from the newspaper days)
Alice values the fashion section at $0.20 and the sports section at $0.10.
Bob values the sports section at $0.20 and the fashion section at $0.10.
If the publisher prices both sections at $0.10, he sells 4 sections and makes $0.40.
If the publisher prices both sections at $0.20, he sells 2 sections and makes $0.40.
But if the publisher bundles the two sections together and prices the bundle at $0.30, he sells 2 bundles and makes $0.60.
In Montreal we have six OTA digital channels (Radio Canada, CBC, CTV, Global, Télé Quebec, V).
I opted to not go with cable, IPTV or satellite because of the quantity of commercials on top of the fee I have to pay for these packages. I hate most are shows that spend more time announcing what is going to come on next and what they just showed, amounting to five minutes of real content in 20 minutes. I have Netflix and I am very happy. All I would like now is to be able to watch Crunchyroll via Plex.
Jumpstart the tartan drive.
Funny how A la carte works in the U.S. but for some reason can't work in Canada
A la carte does work in Canada. Both Videotron and Bell are doing it in Quebec. It doesn't seem to be hurting the channels at all.
And if it leads to the end of a channel that nobody watches, how is this a bad thing?
In the race for subscription dollars, rates for TV services across providers have risen sharply over the last decade as the number of specialty channels, each commanding its own fee, has soared.
There's the real problem right there. The cost keeps going up. So, reduce the overall cost to the consumer, and we won't care if you "bundle" other channels. Get the specialty channels to reduce their fees, or to be included in "bundles" and so long as the overall monthly cost is kept low, the other channels can ride along.
What I fear is everything becoming "specialty" - or charging like it - can you imagine paying $10/mon PER CHANNEL? e.g for SyFy - $10, Discovery - $10. Food network - $5. But that's basically what a la carte will do - eventually each channel will cost $5-$10/month, with "bigger" ones (HBO, Showtime) being $12-$15.
So, for just a FEW channels, the cost is MORE than it would be now:
SyFy $10
Discovery $10
HBO $15
Food $5
ABC $5
NBC $5
CBS $5
FOX $5
CNN $5
COMEDY $5
TBS $5
USA $5
-----
$80/month!
So, PLEASE, let's just go back to one flat rate per month for EVERYTHING - and let's keep it to say, $75/month. Any more for 'tv' makes me just want to kick the thing out on the curb and go back to playing card games, reading, etc.