Another nail for Cable TV's (all bundled subscription) coffin?

[Texas Proud]

Quote:

Originally Posted by Midpack The $64K question. But like many/most, we never watch about 80% of the garbage "channels" in our satellite/cable "package." If we could subscribe to just the networks we actually watch/want, it's hard to believe they'll collectively charge more than the total satellite package cost. The networks know that obviously, so it must be in their internet pricing calculus (if not, demand will quickly fix their pricing). It would seem a great opportunity for popular networks to increase revenue while net reducing costs to consumers. And if some of the less popular networks fail, that's as it should be. Neflix, HBO and others are one thing. As everyone knows, if ESPN ever breaks with cable/satellite subscription, the dragon will truly be unleashed. While there are powerful forces protecting the network status quo, cord cutters continue to increase, so the old model will break down sooner or later...

I think your view on 'demand' is wrong... they still have almost monopoly powers.... and monopoly powers means that they do not have to worry about demand like a normal company...


I would LOVE to buy the channels I want... my bill would go way down... that option is NOT available from any vendor.... hence, I live with one of the bad choices that I do have....

[ziggy29]

Quote:

Originally Posted by Texas Proud I would LOVE to buy the channels I want... my bill would go way down... that option is NOT available from any vendor.... hence, I live with one of the bad choices that I do have....

Probably true if you watch less than 10% of the channels available to you. If you watch more than that, it may not help, since in an opt-in, a la carte model you wouldn't pay the 23 cents per channel that you do in a cable package, but probably closer to $5 per month.

Also in the cable package you get religious and home shopping programs which you may not want, but many of them PAY to be carried, thus subsidizing other programming the cable and satellite guys have to pay for.

[Lsbcal]

Quote:

Originally Posted by ziggy29 Seriously, try TV Fool if you haven't yet. It's as accurate as they come. If you see your stations in the "yellow" or closer, a good outdoor antenna will get them. If they are in the red, adding a preamp to a high-gain outdoor antenna will probably do the trick. Purple will be tougher but occasionally doable with a strong antenna and preamp setup. TVFool uses precise, address-specific info to find your GPS coordinates and maps that against terrain and the broadcast towers, and it's by far the best tool out there.

Nice tool there. Looked like for us we'd need a roof mounted antenna. Against the HOA cc&R's here.

[Walt34]

Quote:

Originally Posted by Lsbcal Nice tool there. Looked like for us we'd need a roof mounted antenna. Against the HOA cc&R's here.

Even with a roof antenna we wouldn't be much better off so the HOA regs don't really enter into it.

[Midpack]

Quote:

Originally Posted by Texas Proud I think your view on 'demand' is wrong... they still have almost monopoly powers.... and monopoly powers means that they do not have to worry about demand like a normal company... I would LOVE to buy the channels I want... my bill would go way down... that option is NOT available from any vendor.... hence, I live with one of the bad choices that I do have....

You might be right. But I'm sure the music industry thought they didn't have anything to worry about either...like hundreds of other industries that have been reshaped or killed off over the decades. And there are more and more 'cord cutters' and millennial 'cord nevers' every day. Not surprisingly, our generation has been the most likely to succumb to the "almost monopoly'"based on the chart posted earlier.

And I am not suggesting you'll be able to "buy [only] the channels you want" at rates anything like the theoretical unbundled cost of cable/satellite packages - that WON'T happen. But there could definitely be win-win price models that benefit popular channels and consumers.

And I'm also not suggesting it will happen soon or easily, but I think it will eventually.

[Texas Proud]

Quote:

Originally Posted by Midpack You might be right. But I'm sure the music industry thought they didn't have anything to worry about either...like hundreds of other industries that have been reshaped or killed off over the decades. And there are more and more 'cord cutters' and millennial 'cord nevers' every day. Not surprisingly, our generation has been the most likely to succumb to the "almost monopoly'"based on the chart posted earlier. And I am not suggesting you'll be able to "buy [only] the channels you want" at rates anything like the theoretical unbundled cost of cable/satellite packages - that WON'T happen. But there could definitely be win-win price models that benefit popular channels and consumers. And I'm also not suggesting it will happen soon or easily, but I think it will eventually.

Don't get me wrong.... I do see the writing on the wall that they will not have that monopoly power in the future.... but it is because of new delivery systems that are coming out instead of some other company putting in cable with a different model...


Remember, just a few years ago you could not get the internet speed that you can today.... and to your phone no less....


I think that some companies might price themselves out of reach of a lot of people... I might pay $1 per month for say TNT or whatever it is that has a few shows I like.... but I would not pay $5 for it.... heck, they have special football channels that have very high prices.... but I guess enough people sign up for them that they make the money....

[Texas Proud]

Quote:

Originally Posted by ziggy29 Probably true if you watch less than 10% of the channels available to you. If you watch more than that, it may not help, since in an opt-in, a la carte model you wouldn't pay the 23 cents per channel that you do in a cable package, but probably closer to $5 per month. Also in the cable package you get religious and home shopping programs which you may not want, but many of them PAY to be carried, thus subsidizing other programming the cable and satellite guys have to pay for.

I do have more than 10.... but when you look at local etc. I could get it down to that.... at times I will watch a channel for one of the 'home shows', but would not pay for it if I had a choice....


And heck, I do not care if they PAY to be on.... let them... I program in my favorites anyhow, so all the other ones I do not see...


I do not see them charging $5 per month per channel.... just a bit too high... I would bet that a lot of channels would not be on anymore... I know that I pay a lot of 25 cents to ones that I could care less about...


The other thing is that I do NOT get some channels that I or DW want... she really wants animal planet... but I have to go up one or two levels to get it and am not willing to pay that much extra for that one channel I want.... even if I get an extra 100 or so...

[Midpack]

Just for fun I looked at how many channels we have and actually watch.

• Our package is called Americas 120, yet it says 190+ channels? We pay just over $70/mo with everything.
• We actually watch 21 of them more than once a year, about 5%.
• There are only 13 we watch regularly.
• So about 95% of the channels could go away and we'd never miss them.

I'd be surprised if they all tried to charge $5-6/mo, some would be less or we'd learn to get by with less than 13.

Remember when we were kids and had about 4 channels (3 networks and PBS)?

[imoldernu]

For everyone who believes that television or internet will ever cost less:

[photoguy]

Does anybody know how the economics of the channel bundling work? I.e. which channels are getting more under bundling than if they were sold a la carte and vice versa? or is it more of a situation that everyone is paying more than they would if channels were sold separately?

I guess nobody knows for sure as this is a hypothetical but are there any well thought out analyses/simulations on this?

[Lsbcal]

Quote:

Originally Posted by Midpack Just for fun I looked at how many channels we have and actually watch. Our package is called Americas 120, yet it says 190+ channels? We pay just over $70/mo with everything. We actually watch 21 of them more than once a year, about 5%. There are only 13 we watch regularly. So about 95% of the channels could go away and we'd never miss them. I'd be surprised if they all tried to charge $5-6/mo, some would be less or we'd learn to get by with less than 13. Remember when we were kids and had about 4 channels (3 networks and PBS)?

We pay about $107/mo now. This includes internet at 50 Mbps. I got the price down by telling them DW would pull the cord if I didn't lower the bill and how I really still wanted the sports stuff. That got me their retention specialist.

We have to use Comcast for internet as there are no good alternatives otherwise. We probably only watch about 1 hour per day of TV and that includes PBS news. Occasionally I go on a rampage and record some hours of something like "Cops" or one of those silly food reality shows. Then watch them when I'm about to head off to bed early.

The HD reception is great and I would not want to go back to the old days. It is a luxury but we can afford it. Don't want to leave too much for our heirs.

[Midpack]

Quote:

Originally Posted by photoguy Does anybody know how the economics of the channel bundling work? I.e. which channels are getting more under bundling than if they were sold a la carte and vice versa? or is it more of a situation that everyone is paying more than they would if channels were sold separately? I guess nobody knows for sure as this is a hypothetical but are there any well thought out analyses/simulations on this?

No but...

I have seen several recent reports stating ESPN costs $5.50/mo.

And I found this supposed detailed channel cost breakdown from 2009.

You might be able to ballpark extrapolate a 2014 table using both bits of info.

However, I don't see the major or any OTA networks listed...

Have ESPN’s Profits Obscured A Mediocre Return On Disney’s Big Acquisitions? | Deadline

ESPN, Fox Sports, NFL Network Cost The Most To Get On TV - Arrowhead Pride

[LoneAspen]

Quote:

Originally Posted by Lsbcal Nice tool there. Looked like for us we'd need a roof mounted antenna. Against the HOA cc&R's here.

HOAs might not be able to prevent it, if it falls within the FAA's Over-the-Air rules:

Over-the-Air Reception Devices Rule | FCC.gov

[photoguy]

Quote:

Originally Posted by Midpack And I found this supposed detailed channel cost breakdown from 2009.

Thanks for posting -- this is really fascinating. It lists the average cost per channel at 20 cents, so if only say 1 in 5 households watched it a revenue neutral a la carte would be $1 (assuming people buy just as much a la carte).

[Texas Proud]

Quote:

Originally Posted by photoguy Does anybody know how the economics of the channel bundling work? I.e. which channels are getting more under bundling than if they were sold a la carte and vice versa? or is it more of a situation that everyone is paying more than they would if channels were sold separately? I guess nobody knows for sure as this is a hypothetical but are there any well thought out analyses/simulations on this?

I am responding after the other post with the prices...

Yes, a lot of small change channels.... but since 100% of the people are paying, that can add up to a lot of money for some food channel that might only be looked at by 1% of the people...

Also, the content providers bundle what they have... take ESPN.... there are a good number of channels I get from them... how many from Turner or XYZ (don't know who they are... soooo).....

The HBOs and other movie channels are paid separate.... and I do not buy them because I just do not watch enough movies on them.... I have been given them for 3 months a couple of times and just do not see the value...


I will have to check out what I do... I bet I could get down to between 5 and 10 channels that I would want that are not network... but then again I think the cable companies have to pay the networks now....

[Gotadimple]

I am not exactly convinced that buying a la carte will cost less than a bundled package.

Netflix, Hulu, etc are bundled services, just like a cable provider. For a flat monthly fee, they provide access (whether you look at all they offer or not). They're cheaper because you can't watch it as it broadcasts.

Think about the cost of telephone service - before the internet and cell phones - and with the ATT virtual monopoly. And what the same phone service (local/long distance only) cost after the break-up.

Same for airline pricing.

Long-term, paying for each channel you might want to watch directly might cost more than what you pay a cable provider today.

-- Rita

[Lsbcal]

We can all theorize about this stuff and it is sort of fun. What is unclear is how tech changes will add to options and a richer experience.

The old standalone ATT landline model is hugely outdated by all the tech advances we could not foresee. I cannot easily compare the costs to the old stuff because we have so much more in communications now and the old landline phone has been somewhat absorbed by the spectrum of talk/text/data. BTW, I still have a redundant ATT landline here in earthquake country for $40/mo.

[Texas Proud]

Quote:

Originally Posted by Gotadimple I am not exactly convinced that buying a la carte will cost less than a bundled package. Netflix, Hulu, etc are bundled services, just like a cable provider. For a flat monthly fee, they provide access (whether you look at all they offer or not). They're cheaper because you can't watch it as it broadcasts. Think about the cost of telephone service - before the internet and cell phones - and with the ATT virtual monopoly. And what the same phone service (local/long distance only) cost after the break-up. Same for airline pricing. Long-term, paying for each channel you might want to watch directly might cost more than what you pay a cable provider today. -- Rita

You are missing what we want.... we want to pay a cable company for the channels we wish to watch.... not the individual channels themselves....

I have DISH.... they are paying a LOT of channels money that I pay to them... if they would allow me to pick the channels I want, I am sure it would cost much less than what I am paying for now.... I bet I could throw out 100 channels at say 25 cents each savings $25... pay the ones I want a bit more and I am good to go... and if one or two try and get greedy and ask for more than a buck or so a month then I drop them...


But the main thing is that you are still going thru a cable provider...

[PhrugalPhan]

Quote:

Originally Posted by ziggy29 Seriously, try TV Fool if you haven't yet. It's as accurate as they come. If you see your stations in the "yellow" or closer, a good outdoor antenna will get them. If they are in the red, adding a preamp to a high-gain outdoor antenna will probably do the trick. Purple will be tougher but occasionally doable with a strong antenna and preamp setup. TVFool uses precise, address-specific info to find your GPS coordinates and maps that against terrain and the broadcast towers, and it's by far the best tool out there.

Nice - I think I tried this site once before. Unfortunately while it takes into account most things like the terrain, it doesn't deal with issues like the airport between me and the "supposed" best channels that periodically scrambles TV transmissions. With the old analog signals this wasn't too bad, but with digital ...

[Gotadimple]

Quote:

Originally Posted by Texas Proud You are missing what we want.... we want to pay a cable company for the channels we wish to watch.... not the individual channels themselves.... I have DISH.... they are paying a LOT of channels money that I pay to them... if they would allow me to pick the channels I want, I am sure it would cost much less than what I am paying for now.... I bet I could throw out 100 channels at say 25 cents each savings $25... pay the ones I want a bit more and I am good to go... and if one or two try and get greedy and ask for more than a buck or so a month then I drop them... But the main thing is that you are still going thru a cable provider...

Yah, Texas Proud, that would be great if we all understood the pricing model the cable company (or Netflix, or Hulu+) uses. Unfortunately, like everything retail, some channels subsidize other channels, and the service company has a profit built it as well.

So, you get one layer of service with the cable company that includes 40 channels - mostly ones not too interesting, but three to five that basically are useful to you (those 5 pay for the other 35). That means you're paying $60 a month for the 5 channels that have some usefulness, and and the other 35 are free!

But if you really want some additional channels in the next tier, you have to pay the added $20 for another 50 channels, of which you only wanted three. And $30 for another 50 channels in Tier 3.

The cable company could get you an a la carte menu, but the pricing would be much different: Like
$60 for the basic channels
$10 per month for each channel in Tier 2,
$20 per month for each channel in Tier 3. Pretty soon, you're looking at:

$60 (sorry sir it's the minimum charge + the taxes don't forget those!)
$20 for the 2 channels in tier 2 you want
$40 for the 2 channels in tier 3 you want
So, $120 + taxes per month for cable a la carte

You can have it your way!

I don't know what you pay, but I pay $60 a month for basic plus tier 2 channels (and I don't care about what they have in tier 3).

-- Rita