HBO May Make The Jump From Cable/Satellite Model To Direct-to-Consumer Model

Discussion in 'The Howard Stern Show' started by chapped, Sep 15, 2014.

  1. chapped

    chapped Well-Known Member

    Reputations:
    384,616
    Joined:
    Jan 6, 2012
    Messages:
    55,632
    Likes Received:
    61,906
    Time Warner CEO Jeff Bewkes said there is a shift in how the cable TV is sold. HBO, which is a part of the Time Warner family, is looking at moving away from satellite and cable companies to become a part of the direct-to consumer model. According to Bewkes this broadband-only option didn’t present itself until now, which is why the company never thought to consider it before. He said the option has grown significantly. While no official announcement was made, Bewkes was a bit optimistic about it, which could give cable operators some reason to worry and people who let go of pay-TV a reason to have faith.

    What Would It Be Like For HBO

    HBO, if it made this move from one model to the other, would find they no longer have a middleman and become a competitor to Netflix. For HBO, the news is good because of the already developed Go app.

    Reed Hastings, CEO of Netflix, said HBO was the only competitor on his radar. Netflix has brought its total subscriptions to 50 million, with another four million expected in the next quarter. The company also surpassed HBO in revenue for total subscriptions last month. Although Hastings talks about competing with HBO, both companies are barely doing that. Netflix is a direct-to consumer business while HBO is still selling through cable companies.

    Although HBO has a 114 million subscriber base, its revenue is less because it must share it with the distributors. Should HBO eliminate its middleman, it won’t have to deal with the costs. It will have an array of other problems to contend with – billing, content delivery, customer service and marketing, which is not on their plate now.

    The company, for a trial, has sold HBO with a thin basic cable plan that includes local channels and broadband Internet, which is found on Comcast and runs around $50 a month. If HBO has no Internet, it can’t succeed. And, once it starts getting past cable, it’s got two possible risks:

    • It could anger its partners who get $8 a month per subscriber and use the channel to encourage people to bundle cable TV.
    • It could have a pricing issue. If the company charges $10 a month, it would make more money per customer than currently, and angering DirecTV, Comcast and others.
    Should HBO makes this move, it could lead to other channels following suit, unraveling the cable/satellite bundle and giving consumers a new option in attaining programming.



    http://www.homemediatech.net/hbo-ma...tellite-model-to-direct-to-consumer-model/558
     
  2. CrucifiedAGT

    CrucifiedAGT He's Around VIP

    Reputations:
    334,098
    Joined:
    Nov 23, 2013
    Messages:
    11,667
    Likes Received:
    24,496
    I remember in 1994, one of the dumbest employees I have ever had tell me that the computer would run day run the entire entertainment center. You'd have a computer on the rack, and all the components including the TV would be hooked into it.

    He also dated women with obvious herpes, then have breakouts constantly. So there's that too.

    As a consumer, I never understood the lack of the a la carte availability in cable/satellite anyhow. Why the fuck do I want to pay for the oxygen channel and anything with oprah in it?
     
    TeeDonkey, jcosey, Lester and 3 others like this.
  3. cg256

    cg256 Well-Known Member VIP

    Reputations:
    69,268
    Joined:
    Jul 15, 2013
    Messages:
    4,593
    Likes Received:
    8,844
    People would only pay for it for the 2.5 months GOT is on and cancel for the rest of the year. They dont have enough content to go on their own. They probably wont get the same movie deals if they went internet only. Amazon Prime already has the back catalog for streaming Sopranos, The Wire, Oz and the couple other HBO shows actually worth watching.
     
  4. Uncle Larry

    Uncle Larry Well-Known Member VIP

    Reputations:
    53,900
    Joined:
    Dec 21, 2011
    Messages:
    4,447
    Likes Received:
    7,683
    If HBO goes this route I hope they improve the streaming quality of the service - at least half of the time I try to use HBO GO the audio is out of sync and there are hang ups in the video.

    I don't have this problem with videos from Amazon, You Tube or other services.
     
  5. Head Censor

    Head Censor Turgid Member VIP

    Reputations:
    393,457
    Joined:
    Dec 13, 2011
    Messages:
    10,321
    Likes Received:
    26,907
    Interesting article. Two things that immediately come to mind.

    1) For all their faults, the current standard that is "cable television" does enjoy a fairly simple user interface. Switching between channels is fast and simple, and the guide features make it easy to see what programming is currently available. By contrast, navigating the net to switch between providers is much more cumbersome, the content tends to be more static and, as technology currently stands, there is no cross platform guide feature that makes it convenient to scan a list of what everyone is airing at a particular moment.

    2) Before heading too far down this path, we should probably also take some time to consider what the unintended consequences might be. Presently, the cable TV providers are also the ISPs for many people. It's hard to imagine that they would allow one lucrative operation to dissolve without trying to recoup their losses by dominating its replacement. Competition and the free market would offer some protection here, but to the extent that the cable companies already own much of the infrastructure that delivers the internet to homes and businesses, the transition could be painful for the consumer.

    I'm surprised the article didn't mention ESPN's online and mobile app, because in my estimation, it's as good or better than HBO's. But even at that, I still have my concerns related to the amount of internet throughput these apps demand and the vulnerability this creates for the customer. I have an unlimited data plan on my phone with AT&T. I would imagine most months I use less than 2GB of data. But after streaming only a few live matches during the World Cup, I received a text from AT&T telling me that due to my excessive usage, they were downgrading the speed of my connection for the remainder of that billing period. I imagine there's probably some unmentioned fine print lost somewhere in the text of an agreement that I had no choice but to accept if I wanted their service that allows them to do this, but it did come as quite a shock after a decade of being a loyal customer.
     
  6. Kool

    Kool Well-Known Member

    Reputations:
    32,141
    Joined:
    Mar 12, 2012
    Messages:
    8,612
    Likes Received:
    8,812
    saw Dalls Buyers Club on HBO yesterday...pretty good flick
     
  7. chapped

    chapped Well-Known Member

    Reputations:
    384,616
    Joined:
    Jan 6, 2012
    Messages:
    55,632
    Likes Received:
    61,906
    I think it all depends on what the final price would be..

    With GOT breaking records every year its hard to imagine that this wouldn't work

    I would not have a problem paying for a few months and then canceling
     
  8. nserafini

    nserafini Well-Known Member

    Reputations:
    3,385
    Joined:
    Sep 7, 2010
    Messages:
    5,260
    Likes Received:
    769
    In the end all the cable carriers will just become ISP's delivering internet and become like the power system. The problem is as more of these go to pay to play, there's not one collective account, you'll have 18 accounts with 18 vendors ( Verizon, NBC,SHO,HBO, ETC ).... NBC doesn't have to host a consumer tech support and account mgmt departments for their clients on the scale Verizon does now. Taking it in house can be quite expensive.
     
    Head Censor likes this.
  9. chapped

    chapped Well-Known Member

    Reputations:
    384,616
    Joined:
    Jan 6, 2012
    Messages:
    55,632
    Likes Received:
    61,906

    Yes but u can decide what u want to pay for....

    Its not perfect but IF HBO does jump ship and succeededs it would change the landscape of cable tv...

    The cable companies have enjoyed a monopoly up until now...this would usher in a new area of competition
    Much how Google fiber is forcing Cable companies it directly competes with to -gasp- offer lower rates and friendlier service
     
  10. Head Censor

    Head Censor Turgid Member VIP

    Reputations:
    393,457
    Joined:
    Dec 13, 2011
    Messages:
    10,321
    Likes Received:
    26,907
    Yeah, I think that sort of follows along the unintended consequences theme. It definitely sounds like there are some economies of scale that would be lost, at least in the near to mid term, if a model like this was pursued. Which, in turn, will likely result in higher costs to the consumer (for an equivalent amount of content), decreased customer service or both.
     
  11. Head Censor

    Head Censor Turgid Member VIP

    Reputations:
    393,457
    Joined:
    Dec 13, 2011
    Messages:
    10,321
    Likes Received:
    26,907
    Viewed from the current paradigm, I agree completely. But if one technology effectively replaces the other, then that advantage might be lost.

    I just want to make sure we're properly assessing the likelihood that, if a near total changeover were to occur, what comes out the other end will be preferable (in terms of content and affordability) to what we have today.
     
  12. cia212

    cia212 Well-Known Member VIP

    Reputations:
    14,308
    Joined:
    Jan 19, 2012
    Messages:
    4,722
    Likes Received:
    3,697
    Would new episodes of GOT air through the streaming service or be posted as an iTunes-like download?

    I prefer TV - computer based DVR systems suck, IF you are even allowed to. I guess that's the point, keeping you from having a copy of the show. You either re-stream it or buy the Bluray. Of course, you can still just download from a file sharing site within minutes of the show airing.
     
  13. HS Cult Leader

    HS Cult Leader Elite Member Gold

    Reputations:
    101,078
    Joined:
    Jun 2, 2012
    Messages:
    13,067
    Likes Received:
    18,316

    I thought it was ok until I read that most of it was dramatized bullshit, if you read the real story about the guy, you would be surprised how different the two stories are. In the movie, they lead you to believe he was a bachelor and got hedro-AIDS from partying hardy and messing with drugs. He actually had a family, and fagged around every chance he got.
     
  14. nserafini

    nserafini Well-Known Member

    Reputations:
    3,385
    Joined:
    Sep 7, 2010
    Messages:
    5,260
    Likes Received:
    769
    So here's the issue someone like HBO or SHO may have. They aren't network, and live off subscriptions. Let's say the GoT continues to be great, but the next 3 or 4 shows tank. In this new model, people will only subscribe for 3 months a year. Revenue peaks and valleys like that won't, in the end, allow HBO to continue being profitable. That cost is past on probably first to advertisers, then at some point to you. Someone like SHO won't compete, so the market contracts as HBO fights to buy rights.

    Who knows, maybe we'll all just have SIM cards :p
     
  15. scoobyla

    scoobyla Well-Known Member

    Reputations:
    35,238
    Joined:
    Oct 29, 2013
    Messages:
    10,800
    Likes Received:
    8,083
    i dont understand why all TV channels dont stream live on their website. they get paid by number of viewers and that would increase viewers, and they can actually be counted, and the ads cant be skipped, and they can be targeted and interactive "click here to buy the shoedini for $10 off"
     
  16. chapped

    chapped Well-Known Member

    Reputations:
    384,616
    Joined:
    Jan 6, 2012
    Messages:
    55,632
    Likes Received:
    61,906
    There are many ways to watch HBOgo on a tv off the top of my head

    Apple TV
    Ps3
    Xbox 360
    Roku
    Chrome cast
     
    cia212 likes this.