[opendtv] Re: Bundling and competition
- From: Craig Birkmaier <craig@xxxxxxxxxxxxx>
- To: opendtv@xxxxxxxxxxxxx
- Date: Wed, 11 Sep 2013 16:42:02 -0400
On Sep 10, 2013, at 4:32 PM, "Manfredi, Albert E"
<albert.e.manfredi@xxxxxxxxxx> wrote:
> The point is only that some businesses (water, sewer, power distribution)
> cannot compete adequately. I don't care if you call it oligopoly. The only
> important point is, they get heavily regulated when competition is physically
> impractical.
Competition in electricity is practical, just not encouraged.
> In this case, the cabled MVPDs fit that description, but not nearly as much,
> the owners of content on these MVPDs (and Internet and OTA).
The wired MVPD situation is not analogous at all, but does look a bit like what
deregulated electric service might look like. With MVPDs we have a local
company that has the wired infrastructure and customer service relationship
with the customer, and a variety of content providers who provide content to
the MVPD. Some content is paid for by the cable company, some is free to the
cable company, and some is a barter relationship like shopping channels. A
portion of your bill covers the cost of the infrastructure and customer service
organization, and a portion covers the cost of the content, although you never
know how much you are paying for what.
It is quite feasible to pay your current electricity provider for
infrastructure and customer service, and to buy the electricity from multiple
content providers. In fact this is exactly what happens in most electric
utilities today - they generate power for the grid and often buy power from the
grid - but you pay the same rate, rather than being able to cut a deal with a
lower cost generation facility.
There is little argument that content providers are now entitled to be paid for
the content they deliver via the MVPD. The argument is that they should not be
able to force everyone to pay for their content, whether we want it or not.
IMHO that is illegal tying, and violates our anti-trust laws. The fact that it
is not challenged is rooted in the fact that the MVPDs are regulated like other
utilities and the governments that tax the MVPDs are happy with the status quo.
> You're getting warmer. If enough people choose to be vegetarians, then the
> price of beef will go down. If everyone must have steak for breakfast, lunch,
> and dinner, then the price of beef will rise. Even if there's competition
> among beef growers, the inflexiblility in demand will allow them to set
> prices higher, because no one will do without.
Perhaps we are getting closer. But your "remedy" is to become a vegetarian,
even though i want a steak once in awhile. I agree, that if enough consumers
got their backs up and went on a hunger strike that the content owners and
MVPDs might wake up. They rely on the fact that we have a strong appetite for
entertainment. And this is not just the MVPD issue; look at the cost of movie
tickets, or actually going to a college or pro sporting event.
> MVPDs came about because they could offer way more choice than analog OTA.
> Once people became totally dependent on that umbillical, even for channels
> that are available OTA, it's really obvious, Craig, that the MVPDs could
> pretty much do whatever they wanted to the price. Then they move sports to
> the umbillical, and that becomes even more true. And sure, as long as the
> addicts pay a hefty fee for the cable medium, the most valuable content
> owners on that cable, the TV networks, will want their extra pound of flesh.
> Totally predictable.
Maybe this is just the inevitable Negroponte switch. A fifty year bait and
switch play.
Unfortunately it looks like they just gave the old bundling model a dose of
Viagra. Now you can watch all of the stuff you are paying for on your wireless
devices, at home via wired broadband, or when mobile via wireless broadband.
>
>> You continue to ignore the fact that you cannot access some content
>> at all, and are willing to wait for other content...
>
> That's disingenuous, Craig. If you watch content on demand, you very likely
> wouldn't be watching it exactly at the same time that it airs as a broadcast.
> Aside from Fox, the other networks put their stuff on their web site a few
> short hours after it aired as a broadcast. Hardly a case of "willing to
> wait." If I have to watch it live, like news, I just watch OTA. And yes, some
> content isn't available. That's when you choose an alternative.
I'm not arguing about time shifting. This is a major benefit for the content
oligopoly as they migrate content to the Internet. It's the stuff you miss
altogether.
>> "Person of Interest" aired on FOTA CBS stations.
>
> But not on their web site. So instead of using the PVR or subscribing to an
> MVPD, I choose an alternative.
No steak for you! Perhaps you really were not that interested - a person of
disinterest.
> There are tons of alternatives, Craig, but you have to be slightly flexible.
> When CBS decides to put that show on their web site again, I'll watch it.
> It's that simple.
>
> The bottom line is that it's not the FCC or Congress that are forcing people
> to ignore the alternatives. It is the consumers themselves that do so, and
> that's obviously because the MVPD prices they moan about are not too high.
There are tons of alternatives Bert. You can pick up an E-book.
If you were really interested in Person of Interest you could have recorded it.
I suspect that you don't watch much FOTA anymore, because you like the
alternatives better.
Regards
Craig
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