[opendtv] Re: TVE definition
- From: Craig Birkmaier <craig@xxxxxxxxxxxxx>
- To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
- Date: Sat, 1 Aug 2015 08:19:27 -0400
On Jul 29, 2015, at 9:36 PM, Manfredi, Albert E
<albert.e.manfredi@xxxxxxxxxx> wrote:
Craig Birkmaier wrote:
You keep telling us that Comcast should be able to sell the same
bundles of channels they deliver to their cable subscribers to
anyone in the country via the Internet. That is exactly what
Dish is doing with Sling
Hardly "exactly." Think this one through, Craig. Yes indeed, all MVPDs can
market whatever bundles they have, or might create to compete, over the
Internet, BUT THEY DON'T!
You are making a huge assumption here that is not grounded in fact.
Just because something is technically possible does not make it legal or
permissible from a business perspective. I can drive our Infiniti EX-35 at 140
MPH on the Interstate, but that's twice the speed limit and illegal.
In order to offer the content from the big content conglomerates via the
Internet, Comcast and the other MVPDs would need to negotiate the rights to do
so.
Comcast just negotiated a new carriage deal with Discovery Networks. We do not
know what rights Comcast obtained via that contract, other than the ability to
offer the linear Discovery network channels via their cables, and most likely
the right to offer these programs via the proprietary Comcast VOD service
(something they were doing under the previous contract). It may well be that
they obtained the rights to sell the Discovery channels to anyone over the
Internet; then again that may not be the case.
Apple is negotiating carriage rights for their Virtual MVPD service as we
discuss this. These deals are complicated and take time. What's more, we are in
the early experimental phase of developing VMVPD services, The content owners
are moving slowly and trying out smaller deals like Sling to see how the
consumer reacts.
Instead, they place artificial walls, so that only if you physically connect
to their wire in your home can you receive the Internet service.
These are not artificial walls. They are terms of a contract that they
negotiated with the owners of the content. Comcast bought NBC Universal to gain
leverage in such negotiations. And clearly Sony Vue and Dish Sling do not
require an MVPD subscription from a facilities based MVPD.
You are correct that the MVPDs and content owners are tying the TVE Internet
sites to the sale of the rights for the linear channels, no matter how they are
delivered.
Sling went two steps further than the other MVPDs, and one step further than
Regards
Craig
1. They place no phony barriers as to who can get their TV over IP offerings,
and
2. They are smart enough to have created a bundle which DOES NOT simply mimic
the old-school walled garden offerings. This second step is important when
you're competing in an unwalled playing field.
We've already been over this Bert. Sling and Sony Play Station Vue are national
Virtual MVPD services. They nave negotiated the rights to offer these networks
to anyone in the U.S. via the Internet. AND they are still negotiating to add
channels to their services, just as Apple is negotiating to create another
VMVPD service.
The ONLY thing we can conclude from these deals is that the content owners were
willing to provide the rights, and in the case of Sling, they were willing to
allow Dish to offer a smaller bundle with fewer channels.
All of this is what one would expect as an industry begins to offer new options
to consumers enabled by a technology shift that eliminates the need to be
connected to a dedicated wire or satellite dish. The Internet is becoming the
new communications infrastructure of the future, but legacies tend to die
slowly when powerful industries and politicians collaborate to support
monopolistic business practices.
Ironically, the Internet is leveraging the old infrastructures it is replacing.
You have talked about the importance of dial up modems to enable the first
phase of Internet access. Now we can connect to the Internet via the TV cables,
the telco wireless data networks, and all kinds of WiFi hot spots connected to
wired broadband.
So stop with the crap about not grasping what is going on.
Read the first important quote, which is later followed by more detail:
"Each cable, satellite, and telco TV-service company has to negotiate
separate, often-complex deals for each channel they want to offer, where they
want it to be viewable, and sometimes for each type of device they want to
support. And new agreements are being reached all the time. That's why it
pays to check your TV service provider's website periodically for the latest
information about new deals and partnerships that could expand its mobile
offerings.
Exactly as I stated above.
When the consumer reports article was written three years ago, TVE was more of
a concept than a reality. Let's look at the statement above, as it may help you
understand why Comcast and others cannot simply sell their bundles everywhere
in the U.S.
1. "Separate complex deals for each channel" - I would go a step further and
say all of the channels that the content owners require the MVPD to carry as
part of the contract. This is how the content owners took control of the MVPD
systems - you want the Disney Channel and ESPN, then you must ALSO carry ABC
Family, and a bunch of our rerun networks.
2. "Where they want it to be viewable" - except for the DBS services, most of
these contracts have geographic restrictions that parallel local franchise
agreements. Because of the FCC program access rules, a content owner must sell
their MVPD channels to the DBS systems and any local overbuild such as a
Verizon Fios system and these systems must have contracts as well. The large
MSOs also offer different bundles in different markets - these differences are
typically related to the regional sports networks they carry.
3. "sometimes for each type of device they want to support" - remember when the
networks blocked Google TV? The ability to support new screens has come slowly.
Comcast and Cox had to negotiate the rights to allow computers, tablets and
smartphones to access their proprietary VOD services, Xfinity and Contour. And
these deals only allow access in the home where the cable terminates.
To my knowledge no content owner has given contractual rights to stream outside
the home - that is what TV Everywhere is about. The MVPD gets the benefit of
subscribers being able to access TV Everywhere, but the content owner gets any
revenues from commercials AND the data about who is watching.
4. "New agreements are being reached all the time" - this is crucial,
especially with respect to allowing a MVPD to stream content via the Internet.
My guess is that just like Apple and Sony, the wired facilities based MVPDs are
negotiating to create VMVPD services.
"Also, a word of caution: Some TV service providers, including Comcast and
Cox, have instituted data caps on your broadband service and count your video
streaming against your monthly allotment. Caps can also apply if you're using
a 3G or 4G cellular network to access programming. You'll have to pay extra
if you exceed your monthly data allotment."
This is TVE, Craig.
No Bert. It is the business relationship between the MVPDs and the content
owners. The Consumer Reports article talks about ALL of the contractual rights
the content owners grant to the MVPDs. TV Everywhere did not exist for most of
the content owners in 2012. When you provided the link to the Cox TVE page I
was amazed at the number of networks I can now access with TVE that did not
exist last year!
This applies to whatever channels you are allowed to get over IP in each
MVPD, whether they are just VOD or also linear, and data caps which also
apply to the TVE streaming. They differ among MVPDs. In effect, this, along
with your bundle selections, creates your TVE bundle.
There is a difference between what a MVPD can stream inside or outside the home
and TVE. The MVPD is not streaming the content - the content owner operates the
TVE site. All the MVPD does is operate a verification server. It is possible
that some MVPDs are doing co-location deals with the content owners to improve
the QOS, but this is on the ISP side of the business, not the video side.
And data caps are part of the contract between the ISP and consumer. We expect
them on wireless service. They are common on wired broadband. My cox broadband
is capped, although I don't stream enough to have a problem. Your Verizon DSL
service is capped as well.
Is this to protect the TV side of the business, or is it the reality that bits
do cost something?
Clearly there are costs associated with connection to the Internet backbone and
for local traffic in large systems. If you get a bunch of homes on a local node
that all stream during prime time, QOS may suffer unless the cable system adds
another node to handle the traffic.
I wrote:
I understand what you want. You would like to be able to access TVE
sites without having to subscribe to a MVPD service.
At long last. How long did it take, Craig? Why is it so painful to get simple
points across?
You have been making this point for a long time Bert. Many months, if not the
past few years. But it is you who fails to comprehend that this is a very
deliberate business decision between the MVPDs and the content owners. You may
be offended by this decision, but it is perfectly legal.
No. I am seriously telling you that TWC does not have the contractual
rights to offer their MVPD services over the Internet.
Not a problem. If they don't know how it's done, they can pay Dish some
amount of consultation fee to show them how. The real reason they aren't all
moving in this direction, YET, is that there are still enough well-trained
walled garden True Believers such as yourself Craig, who are helping to delay
the inevitable. The longer they can keep those garden walls up, plus
artificially placing them over the Internet, the longer they can *operate as
local monopolies*.
You still don't get it. Dish had no special negotiating talent. They are not
operating under franchise agreements with geographic restrictions. As the CR
article stated, these are complex agreements; even the local franchise
authorities have a say.
Both local and State governments are making millions of dollars by taxing MVPD
service. It is far from clear that they can tax a service like Netflix or Dish
Sling. The good news for governments is that they can tax your broadband
service.
BS again. It is extended artificially, because the neutral Internet has no
actual walls **as the legacy one-way broadcast infrastructure had**. And it
is extended "by design," precisely as I described above. Repeating: The real
reason they aren't all moving in this direction, YET, is that there are still
enough well-trained True Believers such as yourself Craig, who are helping to
delay the inevitable. As long as they can keep those garden walls up, plus
artificially placing them over the Internet, the longer they can **operate as
local monopolies**.
The Internet is full of walled gardens Bert; this is not a new phenomenon.
Neutrality only addresses site blocking and/or artificially throttling QOS.
What the operator of an Internet portal does is a business decision - there are
no rules that say you cannot tie services or charge what the market will bear.
You benefit from a tied service relationship with Amazon Prime.
Netflix, Amazon Prime, HBO Now, and Sling are not local monopolies. We can both
access them if we are willing to pay. The content owners have used the
exclusivity of a MVPD subscription to provide access to most of their content;
making it available to MVPD subscribers via the Internet is their way to
protect a very lucrative business model that is propped up by government
regulations.
If you want to change this, talk to your Congress person or the FCC, not this
forum. Tell them that YOU want access to any TVE site without having to
subscribe to a MVPD service. The FCC cannot force the content owners to give
their content away; at best they could require them to offer a stand alone
equivalent like HBO Now, at a price.
Let's take this to the logical conclusion Bert. Let's say that the content
owners decide to do what I just stated - put a price tag on each TVE site. REAL
ala carte at last!
Would you pay between $6 (CBS All access) and $15 (HBO Now) per month for each
source you want? The typical person watches 10-15 channels; the typical home
more than twenty. Going ala carte would be a price increase for most homes.
Bundling is not going away any time soon. But the value of bundles is
improving, in large part because TVE adds value to a MVPD subscription.
Which means, keep the well-trained luddites in line, and you can continue to
force people to pay for a bunch of channels they never watch, using the
tactics of any monopoly. The luddites won't be likely to search out more
competitive options, because they are trained to just accept what they've
gotten for decades. They might "complement," as you do, but momentum makes
them subtract nothing yet.
Pressure is building on the content owners and MVPDs to end the annual increase
in channels we don't watch. Part of that pressure is coming from the Internet
in the form of VOD, which consumers prefer over linear rerun channels. Part is
coming from new services like Sling that offer a cheaper core bundle and small
add on packages. And soon we may see even more options. Apple has used its
bargaining power to disrupt both the music and wireless industries - I expect
that the service they are working on may eliminate some of the undesirable
requirements of the big MVPD bundles.
Meanwhile we wait and see progress in small increments.
No doubt you would fire back "But I would pay for access to a TVE
site." In fact you can - just buy the linear streaming channel
that has a companion TVE site from a MVPD.
False again. Take my specific example: Verizon DSL. I cannot subscribe to TWC
TVE or anyone else's TVE. Not that I want to, of course, but my only
recourses would be to change to either FiOS or to Cox, have them annoyingly
string their cable everywhere, then THEIR broadband package, and then accept
*only their* list of TVE offerings, capacity caps on the TV content, and all
the rest.
One last time - you cannot subscribe to TVE; it is a benefit of subscribing to
the linear channel that it mirrors.
You can subscribe to Sling or Sony Vue now. Both allow TVE access to the sites
that are in the bundle you are paying for.
Clearly, and clearly that trend is ongoing. At some point, the chipping away
will convince the MVPDs that it's time to compete like OTT sites, as Dish
did. You notice what DirecTV did instead, right? Keep the old MVPD formula,
but join up with a cabled MVPD.
Only if they can obtain the rights to offer a service like Sling. You seem to
ignore the fact that TVE is allowing them to offer much of what they are
selling OTT. Ne could logically conclude that at some point they turn off the
linear streams and we just access everything via TVE. But this does not work
well for the DBS services, as their bandwidth is not very useful for broadband
service, which is why DirecTV hooked up with AT&T.
You mean, like the "trend" was for HDTV to be a niche service? Craig, you
don't get trends, remember?
The first HDTV broadcasts started about 1998, only in a few large markets. That
was clearly a niche service. The Super Bowl was offered in HD in 2000, for the
few who could access it.
The product that helped launch the sale of HDTV sets was the DVD, which was not
HD, but rather well encoded SDTV that scaled up well on the HD sets.
The cable industry started offering HD channels in 2003, most notably ESPN,
which is credited with driving the sale of HDTV sets from niche to mainstream
status. Many local broadcast markets did not see HD until 2006-2007.
It took more than a decade to replace NTSC.
We can speculate all day about how long the MVPD model will exist, or what it
will look like in a decade. My guess is that they will still be thriving,
selling broadband and the bundles of TVE sites that you think they are selling
today.
Regards
Craig
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