[opendtv] Migration to virtual MVPDs
- From: "Manfredi, Albert E" <albert.e.manfredi@xxxxxxxxxx>
- To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
- Date: Fri, 4 Jul 2014 00:40:03 +0000
Craig Birkmaier wrote:
> I do not understand why you believe adding another player to this
> oligopoly will result in meaningful competition.
As of now, you may have two or three choices for MVPD, but if you want to
combine MVPD and broadband systems, 80 percent of the country gets one choice
only. But most importantly, these few choices are "sticky." People can't just
change service at the drop of a hat, as you can change TV channels at the drop
of a hat. It's a hassle.
When you create "virtual MVPDs," you don't get "another player," as you state.
You get a kozillion other players, potentially. And changing your favorite
portal, or adding a new one while retaining the old one, becomes very easy to
do. The only obstacle to any of this is non-neutral ISPs. Which is why it's
important for Wheeler to get this right.
The increase in competition would be huge. Hardly just adding one player. This
has already started to happen. Even for FOTA TV, people like me depended on the
local broadcasters, much like you depend on Cox cable. Now I'm less limited.
The same increase in options is also available for pay-TV, and there's no
reason to think this trend will screech to a halt!
> I base this on the assumption that the licenses that a new virtual MVPD
> would need, would require them to protect "the bundle."
That's not how competition works. Already now, people are cutting the cord,
and/or young people never getting the cord. The more online options people are
given, the more they will continue to opt out of the cord. This is not lost to
the content owners. You seem to assume the content owners won't change the way
they operate with third party distribution media, but they already are!
Different virtual MVPDs will offer different bundles, to compete, or even a la
carte. The content owners will become obliged to play along. In fact, some of
these content owners may even run their own for-pay portals, as they are now
running their own FOTI portals, just to get back some of the cord cutters.
> The content owners DO NOT want competition
Not this again. Content owners hold more sway than distribution media, perhaps,
but the consumer has the last word. The more competing portals there are, the
more demand elasticity the content owners will perceive. When the congloms
notice consumers dropping their bundles today, perhaps moving to Netflix or
even FOTI portals, they perceive this as increased demand elasticity. With new
virtual MVPDs, the effect is multiplied.
Content owners won't have a choice, if they want to stay in business!
Bert
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