I suspect if any network could make a go of this, it would be HBO. Not sure that this is a model a lot of other networks are going to be able to follow. ESPN, for example, holds the cable/satellite companies hostage for revenue from every household, whether the people want it or not. I think it would be hard for Disney to move to an ala carte system if that would mean the cable/satellite operators would drop their ESPN channel bundles.
(Note: I'm not saying I'm not for unbundled channels, I'm saying I don't see it actually happening beyond a select few.)
idea is great...but would be hard to seriously consider if it was more than $15-20/month. hopefully HBO knows this.
maybe they can break out their subscription to $10/month for TV Shows and $10/month for Movies. $18/month for both...or something similar.
I read on another site that HBO gets something like $7 per subscriber. If that is indeed the case they could do really well with a $9.99 subscription rate.
Personally, I need cable for sports and for some other stuff. But certainly a lot of other people will be glad about this news.
"Well the horseless carriage is nice for those who want it, but I need my horse & buggy to get to work and take the kids to their factory jobs." This is the first of several slices that will lead to the death of cable companies as we know them - I will gladly pay several individual one-off subscriptions than give my $$ to Comcast in exchange for umpteen channels that I'll never, ever use.
AMC isn't a premium channel. It's included with the cheapest cable packages, and if you wanted to catch up on the show, the first 5 seasons of the Walking Dead are on Netflix.
Never said it was a premium channel, just one that requires a cable subscription to watch. While Netflix has all prior seasons now, I was referring to a season pass for the current season that just starting airing.
I'll actually look forward to paying them for their content. They should have a "retire the eyepatch" campaign.
Yeah, since I started software development as a games dev, I've always been very anti-pirate. If you create media that I want, I will pay you for it. I do believe that most viewers, like you, will give up the pirating for a convenient, fairly priced paid solution.
I have been cable free for almost 8 years now and haven't had a TV at all in the house for the last 2.5 years. But I would happily pay to be able to watch HBO Go content.
To be fair, the BBC were actually the first to unbundle their service from a mandatory payment lock-in with their Global iPlayer, but for the American cable mafia this is a far bigger deal. Dpending on the monthly price, obviously, I would be very interested in this, and I hope Turner Classic Movies does something like it very soon.
Baseball is the one thing I miss without cable. MLB has been talking about trying to update its outdated blackout policy, which might mean the ability to watch local games on MLB.TV. I'm hoping that more and more stations move towards "standalone" options for non-cable customers.
There is a large amount of money to be made by offering cord cutters access to the select programming they want. For instance, I wonder how much AMC makes per household from airing Walking Dead exclusively through cable providers vs. how much they make per household selling season passes on iTunes or Amazon. Add to that: How much do they lose out on when frustrated customers with limited options just decide to watch shows illegally/for free because there isn't an affordable, easy-to-access option?
The problem is that AMC currently charges a carriage fee to EVERY basic cable subscriber. Selling a season pass through iTunes is a far more limited market with comparatively low revenue upside. The whole rationale for non-premium cable channels such as FX and AMC going to original prestige programming is to make the channels so essential to a large cross-section of viewers that the cable/satellite providers must re-up for those channels, even if the carriage fee goes way up.
My understanding is that AMC charges somewhere around $0.40 per month per household, which is the middle of the pack compared to what other channels charge (ESPN and regional sports channels charge by far the highest carriage fees, with ESPN at ~$4 per household, and RSNs at ~$2 per household). With ~100 million pay TV households, you're talking about $480 million annually from carriage fees alone. That doesn't even include the revenues from commercials. Because of the success of series like Walking Dead and Breaking Bad, AMC has been trying to raise the carriage fees to around $0.75 per household, which would put them closer to the upper tier of non-sports channels (I think USA has the highest non-sports carriage fees at close to $1 per household). You can do the math on annual revenues, but that's the amount of money that the broadcasters are looking for.
If they're going to charge that much to the cable/satellite providers, they have to then provide some measure of exclusivity. All of that is at the root of the blackout rules for sports. Sports teams are now negotiating local rights deals in the billions of dollars, with terms that go for a decade or longer. Exclusivity comes with those big dollar amounts.
HBO is a different situation because they are already an optional service. Their current arrangement works great for them because the cable/satellite providers handle the marketing, billing, and distribution. HBO just produces the programming and uploads it. Up to this point, HBO Go has been an added benefit and not needed a huge investment in network capacity (except those occasions when "shared" accounts slam HBO's servers during Game of Thrones). Obviously, HBO thinks there's enough upside to offer HBO Go as a standalone service. Other pay TV channels don't have this luxury, because of their carriage arrangement with the cable/satellite providers.
Baseball is the one thing I miss without cable. MLB has been talking about trying to update its outdated blackout policy, which might mean the ability to watch local games on MLB.TV. I'm hoping that more and more stations move towards "standalone" options for non-cable customers.
If you buy the streaming MLB package you can just use a VPN to get around the blackout rules.
Some of those streaming services are getting hip to that. Hulu Plus blocks anyone using a VPN.
While that's true, Hulu is beholden to the content providers and their restrictions. However, there are still ways to circumvent their VPN block. The MLB package, as well as the NHL package, are available internationally unlike Hulu. Since the MLB and NHL are simply selling their own product and don't care where you are when watching the content, I think it's unlikely they would crack down on VPN users. To this point in time, I've had no issues using a VPN with either MLB or NHL.
I'm in the same boat as you. I wish I could cut the chord but with all the sports and other programs I watch, it's impossible.
I understand your issues but wish you'd phrase it differently. You don't *need* cable, you *need* live sports wich "currently" means cable. I know it's 6 of one, a half dozen of the other but when phrased the other way, it sounds like the cable companies have brainwashed you into believing the only way live sports can be enjoyed is via cable. I would love to see the sports networks go the same route as HBO and make their programming available a la carte via Apple TV, Roku, etc...
I cancelled my cable 3 years ago and replaced it with Netflix and Hulu+ and the only thing I miss is live sports. But since my TV bill went from $1560/year to $192/year, I'm more than happy to watch the game at a friends place or a local pub!
Awesome! I have a feeling that this is just the tip of the iceberg in terms of problems for the cable industry. Surely, more and more networks will follow suit.
The problem is that AMC currently charges a carriage fee to EVERY basic cable subscriber. Selling a season pass through iTunes is a far more limited market with comparatively low revenue upside. The whole rationale for non-premium cable channels such as FX and AMC going to original prestige programming is to make the channels so essential to a large cross-section of viewers that the cable/satellite providers must re-up for those channels, even if the carriage fee goes way up.
My understanding is that AMC charges somewhere around $0.40 per month per household, which is the middle of the pack compared to what other channels charge (ESPN and regional sports channels charge by far the highest carriage fees, with ESPN at ~$4 per household, and RSNs at ~$2 per household). With ~100 million pay TV households, you're talking about $480 million annually from carriage fees alone. That doesn't even include the revenues from commercials. Because of the success of series like Walking Dead and Breaking Bad, AMC has been trying to raise the carriage fees to around $0.75 per household, which would put them closer to the upper tier of non-sports channels (I think USA has the highest non-sports carriage fees at close to $1 per household). You can do the math on annual revenues, but that's the amount of money that the broadcasters are looking for.
If they're going to charge that much to the cable/satellite providers, they have to then provide some measure of exclusivity. All of that is at the root of the blackout rules for sports. Sports teams are now negotiating local rights deals in the billions of dollars, with terms that go for a decade or longer. Exclusivity comes with those big dollar amounts.
HBO is a different situation because they are already an optional service. Their current arrangement works great for them because the cable/satellite providers handle the marketing, billing, and distribution. HBO just produces the programming and uploads it. Up to this point, HBO Go has been an added benefit and not needed a huge investment in network capacity (except those occasions when "shared" accounts slam HBO's servers during Game of Thrones). Obviously, HBO thinks there's enough upside to offer HBO Go as a standalone service. Other pay TV channels don't have this luxury, because of their carriage arrangement with the cable/satellite providers.
Very informative. Thank you.
I'll still be hopeful that someday I'll be able to choose to specific programming I want. If enough people move away from cable, I see these providers looking for alternative revenues streams but, as you mentioned, exclusivity agreements are a huge hurdle to that.
Comments
I suspect if any network could make a go of this, it would be HBO. Not sure that this is a model a lot of other networks are going to be able to follow. ESPN, for example, holds the cable/satellite companies hostage for revenue from every household, whether the people want it or not. I think it would be hard for Disney to move to an ala carte system if that would mean the cable/satellite operators would drop their ESPN channel bundles.
(Note: I'm not saying I'm not for unbundled channels, I'm saying I don't see it actually happening beyond a select few.)
maybe they can break out their subscription to $10/month for TV Shows and $10/month for Movies. $18/month for both...or something similar.
I read on another site that HBO gets something like $7 per subscriber. If that is indeed the case they could do really well with a $9.99 subscription rate.
Well, happy for the people this will help.
Personally, I need cable for sports and for some other stuff. But certainly a lot of other people will be glad about this news.
"Well the horseless carriage is nice for those who want it, but I need my horse & buggy to get to work and take the kids to their factory jobs." This is the first of several slices that will lead to the death of cable companies as we know them - I will gladly pay several individual one-off subscriptions than give my $$ to Comcast in exchange for umpteen channels that I'll never, ever use.
AMC isn't a premium channel. It's included with the cheapest cable packages, and if you wanted to catch up on the show, the first 5 seasons of the Walking Dead are on Netflix.
Never said it was a premium channel, just one that requires a cable subscription to watch. While Netflix has all prior seasons now, I was referring to a season pass for the current season that just starting airing.
iTunes.
I'll actually look forward to paying them for their content. They should have a "retire the eyepatch" campaign.
Yeah, since I started software development as a games dev, I've always been very anti-pirate. If you create media that I want, I will pay you for it. I do believe that most viewers, like you, will give up the pirating for a convenient, fairly priced paid solution.
Baseball is the one thing I miss without cable. MLB has been talking about trying to update its outdated blackout policy, which might mean the ability to watch local games on MLB.TV. I'm hoping that more and more stations move towards "standalone" options for non-cable customers.
There is a large amount of money to be made by offering cord cutters access to the select programming they want. For instance, I wonder how much AMC makes per household from airing Walking Dead exclusively through cable providers vs. how much they make per household selling season passes on iTunes or Amazon. Add to that: How much do they lose out on when frustrated customers with limited options just decide to watch shows illegally/for free because there isn't an affordable, easy-to-access option?
The problem is that AMC currently charges a carriage fee to EVERY basic cable subscriber. Selling a season pass through iTunes is a far more limited market with comparatively low revenue upside. The whole rationale for non-premium cable channels such as FX and AMC going to original prestige programming is to make the channels so essential to a large cross-section of viewers that the cable/satellite providers must re-up for those channels, even if the carriage fee goes way up.
My understanding is that AMC charges somewhere around $0.40 per month per household, which is the middle of the pack compared to what other channels charge (ESPN and regional sports channels charge by far the highest carriage fees, with ESPN at ~$4 per household, and RSNs at ~$2 per household). With ~100 million pay TV households, you're talking about $480 million annually from carriage fees alone. That doesn't even include the revenues from commercials. Because of the success of series like Walking Dead and Breaking Bad, AMC has been trying to raise the carriage fees to around $0.75 per household, which would put them closer to the upper tier of non-sports channels (I think USA has the highest non-sports carriage fees at close to $1 per household). You can do the math on annual revenues, but that's the amount of money that the broadcasters are looking for.
If they're going to charge that much to the cable/satellite providers, they have to then provide some measure of exclusivity. All of that is at the root of the blackout rules for sports. Sports teams are now negotiating local rights deals in the billions of dollars, with terms that go for a decade or longer. Exclusivity comes with those big dollar amounts.
HBO is a different situation because they are already an optional service. Their current arrangement works great for them because the cable/satellite providers handle the marketing, billing, and distribution. HBO just produces the programming and uploads it. Up to this point, HBO Go has been an added benefit and not needed a huge investment in network capacity (except those occasions when "shared" accounts slam HBO's servers during Game of Thrones). Obviously, HBO thinks there's enough upside to offer HBO Go as a standalone service. Other pay TV channels don't have this luxury, because of their carriage arrangement with the cable/satellite providers.
If you buy the streaming MLB package you can just use a VPN to get around the blackout rules.
Some of those streaming services are getting hip to that. Hulu Plus blocks anyone using a VPN.
If by ‘best’ you mean ‘pornography and soap opera-level drama’.
Good.
While that's true, Hulu is beholden to the content providers and their restrictions. However, there are still ways to circumvent their VPN block. The MLB package, as well as the NHL package, are available internationally unlike Hulu. Since the MLB and NHL are simply selling their own product and don't care where you are when watching the content, I think it's unlikely they would crack down on VPN users. To this point in time, I've had no issues using a VPN with either MLB or NHL.
There was very little sex this past season, and I don't remember seeing giants riding mammoths on All My Children.
I understand your issues but wish you'd phrase it differently. You don't *need* cable, you *need* live sports wich "currently" means cable. I know it's 6 of one, a half dozen of the other but when phrased the other way, it sounds like the cable companies have brainwashed you into believing the only way live sports can be enjoyed is via cable. I would love to see the sports networks go the same route as HBO and make their programming available a la carte via Apple TV, Roku, etc...
I cancelled my cable 3 years ago and replaced it with Netflix and Hulu+ and the only thing I miss is live sports. But since my TV bill went from $1560/year to $192/year, I'm more than happy to watch the game at a friends place or a local pub!
The problem is that AMC currently charges a carriage fee to EVERY basic cable subscriber. Selling a season pass through iTunes is a far more limited market with comparatively low revenue upside. The whole rationale for non-premium cable channels such as FX and AMC going to original prestige programming is to make the channels so essential to a large cross-section of viewers that the cable/satellite providers must re-up for those channels, even if the carriage fee goes way up.
My understanding is that AMC charges somewhere around $0.40 per month per household, which is the middle of the pack compared to what other channels charge (ESPN and regional sports channels charge by far the highest carriage fees, with ESPN at ~$4 per household, and RSNs at ~$2 per household). With ~100 million pay TV households, you're talking about $480 million annually from carriage fees alone. That doesn't even include the revenues from commercials. Because of the success of series like Walking Dead and Breaking Bad, AMC has been trying to raise the carriage fees to around $0.75 per household, which would put them closer to the upper tier of non-sports channels (I think USA has the highest non-sports carriage fees at close to $1 per household). You can do the math on annual revenues, but that's the amount of money that the broadcasters are looking for.
If they're going to charge that much to the cable/satellite providers, they have to then provide some measure of exclusivity. All of that is at the root of the blackout rules for sports. Sports teams are now negotiating local rights deals in the billions of dollars, with terms that go for a decade or longer. Exclusivity comes with those big dollar amounts.
HBO is a different situation because they are already an optional service. Their current arrangement works great for them because the cable/satellite providers handle the marketing, billing, and distribution. HBO just produces the programming and uploads it. Up to this point, HBO Go has been an added benefit and not needed a huge investment in network capacity (except those occasions when "shared" accounts slam HBO's servers during Game of Thrones). Obviously, HBO thinks there's enough upside to offer HBO Go as a standalone service. Other pay TV channels don't have this luxury, because of their carriage arrangement with the cable/satellite providers.
Very informative. Thank you.
I'll still be hopeful that someday I'll be able to choose to specific programming I want. If enough people move away from cable, I see these providers looking for alternative revenues streams but, as you mentioned, exclusivity agreements are a huge hurdle to that.
http://9to5mac.com/2014/10/16/cbs-all-access/