I think what most have been saying is that when you DROP TV you can not DROP High Speed Internet. They will just raise the price of Internet if you ONLY want Internet or they will impose CAPS. I do not understand the big complaints about getting the TV Content from the current providers of Broadband.
The complaints are grounded in false math logic. It goes like this:
- I pay $100/month for 200 channels of cable
- I only watch about 10 channels
- Each channel costs 50 cents/month (this is the false math part)
- Thus, if I could just subscribe to the 10 channels I watch, my cable bill should drop to $5/month.
The false math is false because of a lot of things. For example, commercials running on lots of channels we don't watch generate revenue for the production studios who make some of the programming we do watch. Kill off the channels we don't watch and the commercials don't run, don't yield their revenues and thus the shows we want to watch aren't funded (and can't be paid for out of a tiny slice of that $5/month we want to pay).
Or, some channels definitely have a cost per channel. For example, ESPN is perceived to have a relatively high cost to be included in a cable package. Because it is so highly demanded, it's owner (Disney) leverages that demand to "encourage" cable/satt to also carry a bunch of other channels they wouldn't necessarily want to include in their packages. This gets many more channels on which those all-important commercials can run. That generates revenues for Disney which can then help pay the huge costs related to channels like ESPN. Kill off those other channels and kill off those revenues. ESPN then goes from (I've heard) $6-$15/month for JUST ESPN to maybe $20-$40 per month for just ESPN to make up the difference. That's quite a difference (either way vs. 50 cents per channel).
And so on. Basically, we've lost our perspective about the business model. We think local network television should be free because it seems to be free by putting up an antenna. However, all those network shows we love involve all the people we see (the actors) and all the behind-the-scenes people (writers, directors, producers, camera, sound, etc- think of that long list of names in the credits that zip by at the end). They all get paid for making those shows. They don't do all that work for free. If we don't pay for their work (if it as actually free), how do those salaries get paid?
On the cable/satt level, you have hundreds of channels of programming (and other people's money paying so that we can see any of that programming we desire). The industry is built around about $100/month (give or take $50+ dollars) rolling in from each household each month. Cut that to $5 or $15 or $29.99/month with Apple getting their 30% and you are removing a revenue stream of $100 and replacing it with a revenue stream of < $20. While there is certainly some profit in that $100, we should have no expectations that the Studios that make the shows we like will be able to keep making them if their business revenue stream is suddenly cut by 80% or more.
We already have the free video programming that is actually free. That's stuff like YouTube and Podcasts. That's what we get if the dream becomes reality: programming with a cost structure that matches the revenue structure. You don't get a Avatar or Avengers or Titanic or Game of Thrones or Major Sports Programming "as is" by pinching off most of the revenues that holds all that up at that level of quality.
Looking at that "190 channels I never watch", one can imagine that it is 95% of their cable bill. Or they could see it for what it really is: a big piece of the subsidy that contributes to getting to see the "10 channels I actually watch". Of course, we would all love to get just the shows we want for 90% less expense... but that won't make it all go. Get what we want in the wallet and we lose what we want in the programming.
The last piece of the false math is this: while the dream seems fantastic for us (substantially cut the cable/satt bill) and Apple (domination of the video space much like they dominate the music space), the deals that would have to be struck with everyone to make it go would involve Apple having to show them (the Studios) how they are going to make MORE money with this new model, not 80% less. If the new model involves only 3 parties: Studios for Content + Apple as middleman + Us a content consumers, one of the latter two have to come up with that "more money" to get them to play ball. I don't see Apple replacing the "other people's money" subsidy of the current model (just the commercials revenue alone was $49 billion last year). So if it's not Apple showing the content owners the money, who's left?