so what is the current business model for TV?
NBC pays producers and directors and actors to create a show (check "30 rock" is created)
Next NBC has a contract with a cable provider (Time Warner, Comcast) to host NBC and "30 rock" at 8pm on some specific day of the week.
Consumer pays Time Warner and Comcast.
that money goes where exactly? A portion to Time Warner, a portion to NBC?
Does Time Warner keep all the money and NBC already got paid by Time Warner picking up NBC as a channel on the front end?
It goes like this:
1. A production studio creates a show, '30 Rock', that costs '$30 million' to produce a season.
2. NBC decides when to air this show (Thursday 8pm) to maximize their profits through commercials.
3. NBC sends their signal out over-the-air for reception by antennas for free. This is paid for by the commercials.
4. NBC gets additional money by negotiating with Time Warner to pay 15 cents a subscriber, and then Comcast to pay 17 cents per subscriber, then DirecTV to pay 12 cents a subscriber, and so on....
5. Time Warner decides to place NBC (15 cents), with CBS (15 cents), NBC (10 cents), etc. etc. etc. in some package that they charge $30/month for.
Also why is there like a gold, silver etc. package where certain channel are missing, certain ones are there etc. What the hell kind of FU to the customers is this? Why can't I customize a Channel lineup. Say i pick only 20 channel I care about. Why does channel 4 need to be NBC?
Because HBO charges something like $7/month per subscriber. Time Warner could just put that in the regular package, and charge $37 instead of $30 for it, but they think the best way to profitability is to have different packages. But it's all up to Time-Warner. They could easily have customized lineups, but they choose not to.
Originally, when the cable systems all started, it was all-or-nothing. The systems weren't designed for individual-channel blocking because it didn't make any sense. People all got about 5-10 channels over the air, and cable was just over-the-air channels in higher quality without having to re-position your antenna, plus a few extra channels. Then HBO came along, and they then had 2-tiers. They could only split it so much.
The technology is now here where they could offer channels individually if they wanted to.
So if NBC has a contract with Time Warner is that excusive for say the New York area? Can apple also have a contract with NBC for TV shows?
Yes - definately. Apple could negotiate with NBC New York to get their shows. There are legal issues, however, with who they can show the feeds to. They can't show someont the NBC New York feed in Cincinnati, because the NBC Cincinnati owns rights to this content in the Cincinnati area.
I know for example for NFL games you need direct TV for our of region games and they also black out games etc. Such a damn joke. TV must be the biggest FU to the consumer now that I think about it. Such a broken customer experience.
Yes - DirecTV has an exclusive agreement with the NFL. And the NFL has some of it's own made-up rules regarding black-outs which are pretty stupid. Apple could negotiate the next NFL exclusive contract if they wanted to. I think the DirecTV one expires in 2015?
Also the "free" hardware you need to rent from them is a joke. It's big and ugly and boxy and so unelegant next to the rest of my TV boxes. The remote is awful, the DVR is hard to use, the space on it is small, the channel are laggy.
Now that I think about it I hope apple fixes all of this. Wow could be great.
Apple could negotiate it's own contracts with NBC, CBS, HBO, etc. and have it's own model of charging per network if they wanted to. And I hope, if it's not Apple, that someday soon some company changes how things work.