Folks the days of channel programming as a component of the entertainment complex is rapidly drawing to a end. You see I finally have a media box running XBMC operational. Not a real big shucks, for the geeky, but there is a considerable amount of configuration work that has to be done post install.
Some 600 channels delivered via the Internet. No channel provider need apply. All those channels are on-air programming. RTE1 & 2, BBC 1,2,3, SyFy, Several Russian channels as well which is delighting my wife.
But those are still channels Dog. Granted. But I can go over to YouTube and download free movies. Add them to my library. The same with several other feeds that can be found. Work is already afoot by the team to integrate XBMC with NetFlix. The short story of all this is, the free tech already exists to automate your viewing pleasure without spending a dime.
Like the networking and telephony fields, the intelligence is moving to the edge of the network for entertainment as well. Centralized channel deploys will be a thing of the past. A very smart movie studio is going to figure this out.
I could see a XBMC addon provided by the studio. You install it, enter your provided identity code and have access to that studios back list of movies for $5mo. $50/year to have access to the MGM or WB back list. I would go for it at that price. Don’t have to include DRM either. Codecs exist that lock the stream route so it can’t be copied without all the pain of true DRM.
You will excuse me, my wife wants me to turn up the volume.
… cable that is. The cable majors in total lost 500k subscribers last quarter. Comcast led the pack on that score –
There’s now even more evidence that subscribers are cutting the cord and opting out of paying for cable: By adding up subscriber losses from four of the top five cable companies, we found that more than half a million users have ditched their cable companies.
The carnage began last week when Comcast announced it had lost 275,000 basic cable subscribers, but it has continued as Time Warner Cable, Charter Communications and Cablevision have all reported major subscriber losses of their own.
No. 2 cable provider Time Warner Cable announced today that it shed 155,000 cable subscribers during the third quarter, which included 46,000 digital video subs. Yesterday, Charter Communications reported that it lost 63,800 basic cable subscribers during the previous quarter. And Cablevision said this morning that it shed 24,500 subscribers during the same period, including about 5,000 digital video subscribers.
GigaOm goes on to mention that in many cases the cable loss rate vs the Dish/Uverse/FIOS up take is shy about 200k. Simply put, many are just foregoing any sort of broadband connection. Then there are the rates –
That’s a trend we see continuing, particularly as cable subscribers continue to raise their bills at an incredible rate. Comcast reported on its earnings call that average revenue per user (ARPU) increased by 10 percent year-over-year, ending the third quarter at about $130 per month. Charter’s ARPU also rose about 9 percent, to $126. And while Cablevision’s reported average revenue per sub didn’t grow as fast as the others, it’s now a whopping $149.
All of which is why we think that the cord cutting phenomenon, which Comcast and Time Warner Cable deny is something that they’re seeing, is for real. From our point of view, expecting users to pay $125 to $150 a month, and continuing to raise those rates 5 to 10 percent every year, isn’t a sustainable business model. At some point, those users will find alternative, cheaper ways of getting the content they want, and now there are plenty of ways to do so.
We here at ThirdPipe have said all along that if the providers tout their services as an entertainment venue rather than an essential service they increase their risk in an economic downturn. It appears to be happening this cycle. I also wonder if cable and Telco offerings too has lost their glitz? Five years ago cable-payperview were the hot things to have in the home. Now not so much and with the bad economy a $150 expenditure that is not used often enough is just not justified.
In business there are several ways you can win. You can be head and shoulders above everyone else. Your competition can be total screw ups. You can gain a defacto monopoly by political legerdemain. Or some mix of all of them. Case in point –
In just over two weeks, Emmy-winning AMC drama Mad Men is slated to begin its fourth season on the basic cable channel. But with negotiations between its parent company and AT&T U-Verse over carriage fees, the cable and internet provider might force subscribers to relocate their premiere parties to the apartment of someone with Comcast.
It’s not just AMC that faces being dropped by U-Verse. Female-oriented channel WE tv and the Independent Film Channel could also face the firing squad if AT&T can’t reach an agreement with parent company Rainbow Media before July 25.
This is similar to the situation faced by Cablevision last March when its pricing squabble with ABC resulted in customers missing a bit of the live Oscars telecast.
It is crazy that a channel customer should be losing any access to the entertainment over some internal provider-carrier squabble. That is fighting over who washes the dishes kind of silliness. And the customer be damned thank you very much.
The better model is the carrier is paid by the subscription of the consumer not by the channel provider. No squabbles occur. In fact under that scheme the two parties work in concert to maximize subscription rates. The whole effort become customer focused rather than channel focused as it is now on cable.
And that is why the likes of Netflix and Hulu will be winners in the space.
We here at ThirdPipe have long held the conviction that paywalls for content on small value product really are wrong unless you are providing the service as part of a larger offering. A good example would be the Apple Store iTunes as a conjunction with the Nano MP3 player. Or the paywall is a convenience factor to an already high value information source. Say Dunn and Bradstreet where all you have to do is register if you already subscribe to the service.
But to view a paywall as a new income stream? Bonkers man. Ain’t gonna fly. NYT found that out two years ago. Now NewsDay has found out the same thing –
So, three months later, how many people have signed up to pay $5 a week, or $260 a year, to get unfettered access to newsday.com?
The answer: 35 people. As in fewer than three dozen. As in a decent-sized elementary-school class.
That astoundingly low figure was revealed in a newsroom-wide meeting last week by publisher Terry Jimenez when a reporter asked how many people had signed up for the site. Mr. Jimenez didn’t know the number off the top of his head, so he asked a deputy sitting near him. He replied 35.
Now to be fair one has to consider the context of that number. NewsDay also owns the local cable franchise as well. Plus anybody who subscribes for the pulp get the online subscription free as well. So a large swath of the potentials already have access for free. But what it does show is that a paywall is a barrier unless one is linking it to something larger. There is too much free content out there to justify paying for it. Fact one concept that none of the papers yet fathomed is that they are third person before the reader gets to it. Customers are cutting out the middleman and reading the press releases directly now, removing the filter and hence the need for the paper itself!
We have said this before. If a paper wants to make a go of digital news content they need to follow an old Telco prescription. Offer the handset for ‘free’ and pay for it and your talk time as a bundle. In the papers case, you offer the Kindle II for free bundled with a 2 year subscription to the paper at $9.95 a month. Then you make sure the digital daily is on the machine everyday. Don’t require the reader to futz with a download, it has to be a push.
Its a multimillion dollar idea offered free.
Or should I say the channel selector? You still might want to keep the cable for data transport — to get TV. –
So say you skip the Boxee Box and go with the Zino. One of the frustrations of internet TV is finding what you want, when you want it. This show is only on Hulu, that show is only on the network’s portal, and you’re on the web…what do you care which network produced what show? Can’t someone else keep track of that?
Well another launch yesterday was Clicker, a programming guide for internet TV. What’s nice about Clicker is that it only offers full episodes of content, so you won’t get dozens of hits that lead to 15 second clips. Clicker catalogs content from both free and paid sources, such as Netflix Instant Streaming and Amazon Video-on-Demand, but it marks paid content clearly so you can skip over it if you wish. You can set up Playlists, and Clicker also offers some social features, such as Trends and connecting your Clicker account to your Facebook account.
With each passing month it seems like cutting the cable cord becomes a more viable alternative, but yesterday in particular seemed to be a Big Day for internet TV (most of these launches were probably due to the NewTeeVee event that took place in San Francisco, CA). So are you ready to ditch cable? Or have you already? Please share your thoughts in the comments!
That is from IT World. Not exactly a CES oriented publication.
But the question is, is next year, THE year more users cut out the channel side of the cable connection? It could be if things remain stable as in near free. Or that Hulu does go to a paid service that’s like $20/year and includes premium offerings at that price. Sadly for the TWC and Comcast’s of the world, whether that happens or not is out of their hands.
The deep question is could Comcast survive as a data only transport provider?