Please, keep paying $80 a month for cable so I can enjoy cheap TV
xconomy.com
xconomy.com
Wait, Netflix has a quarter the viewers of all cable/sat TV viewers? Not inclined to call that "only a fraction", more like the hemorrhaging is well under way. Try taking all streaming video customers into account, I'd guess it's closer to half.
This "subsidizing" won't go on for long. My kids are growing with absolutely no notion of what "TV" (the ad-driven kind) is; those who do are used to a plethora of on-demand alternatives. 15 years from now, "channels" will be on-demand streaming sources unlike the schedule-driven content we have now.
The one thing I think is still missing: the streaming equivalent of TV's "here we are now, entertain us" - the pick a source and just watch a curated series of shows (not just same series episodes back-to-back).
Something equivalent to channel-zapping, or a tv listing.
Netflix might be beginning to suffer from the "Paradox of Choice" - I don't want to spend my already-depleted willpower choosing among all the available programming.
http://en.wikipedia.org/wiki/The_Paradox_of_Choice:_Why_More...
That, and live + on-demand streaming of sports, will finally kill cable.
I watch about 5 broadcast shows throughout the year. One is gone now since Breaking Bad is off the air. The only other thing I use my TV for is CNBC/Bloomberg and sports. Cutting the cord is just a horrible situation when that is the case.
I did it for five years and now that I have cable again I don't think I'm going back.
I use my chromecast to put it on my TV but even then, I don't regret paying for cable whatsoever.
I may or may not do this with the NBA and it works well enough. For the NFL, I'm generally happy with the games that I can pick up with my HD antenna on my TV, so I haven't tried their service.
You have to pay a few bucks a month for the VPN, but I like having a VPN service available anyway, so it's not a big concern for me and you're still saving substantial money over cable.
* With a router that can intercept DNS requests.
Are you cord cutting for economic reasons, or are you just opposed to cable companies in general? If it's the former, I think you need to rethink your plan.
Thing is, we'd go to the pub every other week and shell out 3 pounds per pint each time, stay for 2-3 games (sometimes more as La Liga is often on later) which between 3 of us would usually top out at around 20-25 quid each saturday.
I'm not sure how the US works, but even if you're a "sparkling water, please" person it's likely that paying a little extra for the sports channels is works out cheaper than going to the pub.
The only real difference is that in this case the early adopter is the normal case and the late adopters are the outliers.
This is how successful media business models work: milk the most money from those who most desire the product.
This isn't the case where I live. A new release DVD costs approx. £10. I can get a cinema ticket for as little as £3.50.
I'm referring to renting the DVD. Or even buying the DVD, and watching it together as a family or group (£10 DVD vs. 4*£3.50 movie tickets). But yes, there are some caveats.
*although you'll be dead long before you can watch breaking bad
For people like me, entertainment is fungible. I can enjoy myself watching football, playing a game from Steam, reading Mr. Money Moustache, streaming something from Netflix, or renting from RedBox. The game has changed. There is literally more high-quality entertainment than I have time to consume. Of course there is going to be downward pressure on prices.
If any of those things cost too much to be worth it (like non-local-market NFL games and non-event films in theaters), I'm going somewhere else with my money.
If the economics don't make sense for Hulu to entertain me for cheap (the number of commercials are pushing it already), no skin off my nose. There are probably some books I haven't gotten around to reading anyway.
So, for me, the supply of entertainment is high, my supply of attention and my budget for entertainment are both rapidly shrinking. So for me, and I suspect more people every year, paying a large monthly fee for cable (or even streaming services) is absurd.
The reason being social. If I wait a year or two for a show to appear on Netflix, my friends aren't talking about it, people aren't speculating about it... the buzz is gone. It's falling out of the zeitgeist.
It's true that if my only goal is to sit in front of a screen and amuse myself for a couple hours, it's very fungible. A $8/month netflix account + a $50/mo (or less) internet connection lets me do that.
But I want to be in tune with the culture. I want to be able to talk to my friends/family about that crazy play in the game on Sunday. I want to be able to read all the [spoiler alert] postings when they are current. I want to be able to play whatever game online with my friends while they are still interested in it.
It's really no wonder that they hold on to Game of Thrones like it's their crown jewel. It is.
If some entertainment for some people isn't fungible, then producers like HBO and ESPN will certainly have some sort of market capture. But their respective captures will probably overlap less and less as time goes on and interests diverge.
And that really doesn't detract from my point, which is that I don't require subsidized entertainment, and I believe fewer and fewer people do. Between that and the ever-increasing supply of top-notch entertainment, I don't see people affording relatively expensive cable packages, movie tickets, AAA games, and pay-per-view events as much.
Keep in mind that I'm talking about trends, not anecdotes, so there may be exceptions for certain periods of time, certain producers, and certain indrustries.
That being said, it's still not fungible. I want to watch what my friends are watching - it's not at all the case that "any content will do". Maybe my group of friends watches Game of Thrones, maybe they only watch How I Met Your Mother, it doesn't matter.
Though one interesting thing that happened was the Netflix release of Breaking Bad saw a significant group of my friends suddenly watching it. If none of my friends have cable and everybody waits for the Netflix release, I will too.
I do take issue with the TFA, though, even if it is sarcastic: I don't think it's the sports fans who are getting screwed in cable deals; wasn't there an article a while back that described (or at least the comments did) in detail how all the non-sports fans are being forced to subsidize ESPN by not being allowed to opt out of it?
I also have netflix and attempted to use Hulu for a while. I couldn't find enough content I wanted to watch. It was too difficult to switch back and forth between content.
Now I have hundreds of channels. There are 3D movies available to stream from U-verse.
I will get the UFC fight tomorrow on PPV through AT&T which by itself will be $60 for 3 hours of viewing.
"In short, my cushy life as a TV free rider is only feasible because there lots of people like you who aren’t switching to Internet-only video. So please, keep on subsidizing my high-quality, low-cost couch surfing experience by paying your big cable bills for as long as you can."
Your viewing experience is not as good as mine. It's cute you think so.
Oy.. So much smug over choice of entertainment packages. If you're into 3d movies and sports, cable sounds like a good fit for you. Others, like myself, aren't into sports (unless ESPN were to start broadcasting eSports), and I have no desire for 3d movies nor 100s of channels. For me, Netflix, twitch, and amazon gives me a better experience than cable.
It's almost as if, and this may be crazy, something being a "good experience" is subjective.
"Please, Keep Paying $80 a Month for Cable So I Can Enjoy Cheap TV"
The author is picking up my scraps and he's welcome to them.
Hulu is a complete fucking piece of crap cause of this.
Umm, My wife and I watched Homeland on Netflix. That's streaming and we don't have a cable subscription.
What point are you making exactly?
http://dvd.netflix.com/Search?v1=homeland&ac_abs_posn=-1&fcl...
Content: (I live in a 54,000 population town: 20 channels or so, nbc, fox, abc, etc.), major shows on major networks, live sports on certain days; Drawback: no Breaking Bad or other specialty channel shows.
Quality: Unbeatable all channels 1080i - No static, you either get the channel or you don't.
Functionality: I use Windows Media Center which works like a dvr.
Cost: $40 tv tuner on ebay, $20 antenna from Radio Shack. No contracts or subscriptions.
I can't wait until Aereo comes to my city.
Note that the best place to get signals is high up, on top stories or roofs. Sorry basement dwellers.
Source: Google's stock today.
Source: Facebook's stock today.
Edit: Also the cable companies only own a small number of the channels they broadcast therefore the ad revenue from those may be zero.
I felt this way the second I saw XBox Live. Imagine how much more content you would be willing to consume from there if everything wasn't a la carte. You have a captive audience where you can charge advertisers a premium for getting in front of those eyes.
Instead the customers are asked to pay a monthly fee just to access online content and you either pay per download or for a secondary service.
It's exactly why I don't miss paying for cable or watch much live TV.
I have absolutely zero interest in any sports whatsoever. Even trying to watch the news you have to put up with ridiculous sports related stories weaved throughout.
Thank god for PBS.
I'm sure the leagues are incentivized to maintain local blackouts as a way to capture enormous deals with various sports networks, and also to drive gate revenue, but cutting out the league middleman does afford them the ability to do some nifty things, like directly charge consumers of their content.
The last episode of Breaking Bad had 6 million live viewers. Assume that everyone cuts their cable, and only half buy the finale for the average price of $3.5. Also assume that prior to this no one is buying it at all. Yank the standard Apple-style 30% and that's still almost 15 million dollars. That's real money right there.
Want to charge less per episode? Breaking Bad's last season cost $3.5M per episode to produce just to break even on production costs they'd need to charge just over a buck per episode (3M paid) and you'd still be charging that household $68 bucks a month. That still real money right there.
[1] http://www.nydailynews.com/entertainment/tv-movies/americans...
[2] http://variety.com/2013/tv/news/mipcom-katzenberg-offered-to...
But that aside, The 34 hours a week includes a lot of advertisement watching too, so I'm sure there are hybrid models that could be explored where you get a good discount on streaming for choosing to watch some ads inserted into the middle of the show, say $1.99 for the SD show without commercials or heavy discount (maybe even free) if you choose the ads, and then the higher end $2.99 for people who really insist on "HD".
Also, I'm sure not all of that 34 hours per week the average person watches is Breaking Bad quality, presumably a lot of it is filler that would be valued far less by the watcher and thus have to be priced far less, which is one of the real benefits of ala carte. When I was a cable subscriber I felt like I was subsidizing a lot of really shitty networks churning out really shitty programs. I'm perfectly happy to pay the same amount per month (or even a bit more!) but with all my money going to programs of a high enough quality that I choose to pay to watch them specifically.
Assuming that everyone cuts their cable and half of the 6 million people who watched the Breaking Bad series finale pay the $3.50 to watch it, that's $10,500,000. Less Apple's 30%, that's $7,350,000 in revenue left.
Bear in mind two things:
1) It reportedly costs $3M to $3.5M to make an episode of Breaking Bad.
2) The average viewership per episode in the last couple of seasons was substantially less than 6 million viewers.
Suddenly the numbers become a little murkier.
How much will each episode earn over its lifetime?
AMC would never have had the money to do this and Mad Men without the subsidy of cable bundles funding them during the early years. If AMC was an ala-carte channel in 2005, none of this would have happened.
To flip the tables a bit, here is the same logic being applied to tech, instead of TV/Film:
First, lets get rid of these incubators, angels, VCs, and IPOs pumping money into the system up front. Surely, the $30 million spent to start Foobr.com could easily be paid by the users, right?
Second, instead...sell time on Foobr.com at $2.99/day a la carte. Multiple by the 1 million users that the $30 million pre-funded Foobr.com has today, and Boom! Foobr.com can clearly exist (in the same form, too!) if we got rid of incubators, VCs, IPOs, aquihires, and all the rest.
Third, gloat on HN, in blogs, podcasts, and on Twitter. It's math, dude! Bask in my brilliant economic analysis of the startup ecosystem. You people working at Ycombinator and VCs, and buying stock at IPOs? Chumps, all of you! You're just subsidizing my usage. I get for free what you pay billions for. Idiots.
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This analogy (if you don't know TV and Film is funded) is much stronger than you'd think. It's amazing how similar the two are in terms of funding.
And hopefully everyone can agree that removing literally all of the up front funding channels for tech startups, and instead moving to a la carte pricing on the final product, is not a workable plan. The same is true of TV and Film. You cannot simply move it to a la carte pricing and expect the exact same things to be available, and at the same quality level.
There are very strong reasons why the Film/TV ecosystem is the way it is that are not immediately obvious to people outside of it. If you want to disrupt it, you'll first need to understand it.
*as best I can tell
Let's be super conservative and take just that 10% into consideration. That's still $78.3 million a year from the Comcast and DirecTV accounts. If we take all cable fees into consideration, the number climbs to somewhere closer to $400-$600 million a year.
That's a pretty big chunk of change to sacrifice, especially very suddenly. If the CEO of AMC Networks "cut cable" out of his model in the course of a year, the company's stock price would collapse, and he'd be out of a job in record time.
No question that there's a lot of money to be made from VOD licensing and a la carte purchases. But we need to be realistic about how companies like AMC are going to get there. It's going to be a slow transition, not a sudden one.
And no, I'm not in a rural, remote, or otherwise hard-to-serve area. For many years I've lived in affluent, dense, urban neighborhoods in some of America's most important cities. Yet I've never had any ISP available other than the cable company.
Those of you who are familiar with the ISP industry: By your estimate, when will most Americans have at least two options for Internet service?
I use digital/HD cable, Netflix, iTunes, and HBO Go along with using TOR to watch shows that I normally can't see here in the U.S.
Why? Is it because I'm a sucker? No. It's because I got a good job and I can afford the things that I like and that make myself and my wife happy.
Not everyone wants to watch live TV, some people are happy to watch their shows afterwards, which makes sense. Personally, I hate the hassle of using illegal streaming sites and I refuse to use torrents just because I dislike gambling on the quality.
I pay $80 a month for decently fast internet (30 down and 5 or so up), all the broadcast and premium tv I can watch, and the ability to watch tons of HBO content on-demand via my phone or iPad wherever I am. Then I pay for Netflix streaming and that adds that much more value, so let's call it $90 a month. That's absolutely nothing.
But, if you want to pay less then that's a fine choice as well, and I can respect that. It doesn't make me a sucker any more than it does you. Now, go bag my groceries.
Before this article, I'd never heard of Aereo. Their solution sounds pretty sweet. I signed up for being notified once they're in my area. I'd love to ditch the big frickin' antenna in my garage attic since it does absolutely jack squat in terms of picking up digital TV signals these days. We're bound by neighborhood covenant laws from having an antenna outside, so having Aereo would be great.
The only thing I'm "meh" about Aereo is $8 / month. I'd be willing to pay $5 or less. $8 / month is too steep for me given our media consumption habits.
Are you in the USA? Laws* that interfere with antenna use are not enforceable.
http://www.fcc.gov/guides/over-air-reception-devices-rule
* "applies to state or local laws or regulations, including zoning, land-use or building regulations, private covenants, homeowners' association rules, condominium or cooperative association restrictions, lease restrictions, or similar restrictions on property within the exclusive use or control of the antenna user where the user has an ownership or leasehold interest in the property"
"We don't give away trees to newspaper publishers. Why should we give away more airwaves to broadcasters? The airwaves are a natural resource. They do not belong to the broadcasters, phone companies or any other industry. They belong to the American people."
from http://www.nytimes.com/1997/03/27/opinion/giving-away-the-ai...
Why shouldn't, for example, CBS be charged a modest $1,000,000,000/year for their use of the public airwaves?
Anyway, television broadcasters are becoming irrelevant.
The cost savings start to add up if you hold on to your phone for longer than 2 years, but if you're the kind of person who buys a cutting edge phone every 18 months, prepaid is only an advantage if you care about being able to switch carriers on the drop of a hat.