[opendtv] Re: Estimate of MVPD subscriptions
- From: Craig Birkmaier <craig@xxxxxxxxxxxxx>
- To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
- Date: Thu, 6 Aug 2015 07:38:23 -0400
Regards
Craig
On Aug 5, 2015, at 8:34 PM, Manfredi, Albert E <albert.e.manfredi@xxxxxxxxxx>
wrote:
Weren't you asking about 80 percent recently, Craig? Are you going to go on
with this until "let me know when it's less than 5%"?
No Bert. I have been very consistent about the 50% level. We have been trading
barbs about this for a couple years. Various reports place the actual numbers
between 80 and 85%. That is a huge market that is generating more than $100
billion in revenues annually.
The rates of cord cutting are stabilizing. At the current rate of decline it
could take another decade to get to 75%. The point I am making is simple:
These oligopolies have the power to ride this one down. Broadcasters have
managed to stay extremely profitable over the 3+ decades since cable started to
offer more choice and grab 80% of the U.S. TV market.
One common theme in the recent quarterly results from the MVPDs is that overall
profits were up, despite some hits from sub losses on the TV side and declining
ad revenues. The major reason for the profit increases was the ADDITION of
broadband subs.
Me thinks these guys are going to survive this technology shift...
You won't know when we get to 50%, Craig, because the old MVPD model will be
hopelessly outdated by then, and no one will care to keep track anymore.
That's because we will never get to 50% Bert. Consumers are going to continue
to subscribe to bundles of linear networks, because these networks will
continue to control much of the content people want to watch.
The underlying technology for cable/Fios will shift slowly from dedicated video
bandwidth to generic IP bandwidth, and DBS will survive as a big broadcast data
pipe to complement broadband.
And the concept of a MVPD bundle will evolve from hundreds of linear streams to
a few dozen content sources offering access to both linear streams and library
content.
This will likely be augmented by one or two SVOD services in most homes.
Just like, "let me know when 4:3 TV sets fall to 50% of TVs." Who cares,
Craig? Just about all TV productions are now 16:9, because the trend was too
obvious for anyone to miss.
Apple and oranges. The same companies that drove the cost of a NTSC TV down
until the only profits came from royalties, did it again with HDTVs. But they
failed with 3D, and the jury is still out on 4k. I believe we will all move to
4K displays, just as we moved from NTSC to 1080P. But the forces behind this
shift will be different this time.
We have already seen this shift in computing platforms. At one time our
computer displays were pathetically under powered. 72 DPI displays with a
graphical user interface were "revolutionary." But we needed a laser printer
with 300 DPI to see the high quality images we were working on. Now we have 4K
computer displays and our mobile devices have 300-400 DPI displays. This shift
was critical to improving the contrast available for both synthetic and sampled
imagery. And this is going to be critical for TV displays, which will be dual
use - to watch moving images (TV), and to support web surfing and all the apps
that will be run from those big screens.
And by the way, we did not shift from 4:3 to 16:9 as the source standard. We
moved to a more flexible acquisition environment that accommodates multiple
acquisition aspect ratios from 1:1 to 2.5:1 or wider. The displays have
generally become wider, with 16:9 the most common for TV screens, but a variety
of screen aspect ratios are used on the mobile devices that are increasingly
being used to watch video streams. The big change is the ease with which all
screens are able to accommodate all source aspect ratios.
So please do let me know when the percentage of homes that subscribe to some
kind of MVPD bundle drops to 50%.
Regards
Craig
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