The Changing Landscape of Television Entertainment

Discussion in 'Community Discussion' started by mscriv, Apr 21, 2015.

  1. mscriv, Apr 21, 2015
    Last edited: Apr 21, 2015

    mscriv macrumors 601

    mscriv

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    #1
    I posted this in the TV Binging thread here at MR:

    This got me thinking... The landscape of traditional television entertainment is obviously changing and it's going to be interesting to see how it plays out. The entertainment industry is fighting for your "screen time" and they are coming to the realization that the TV is merely one of the screens that you own.

    People have been clamoring for more choice in the traditional cable/satellite programming model. We have various threads here at MR about "cutting the cord" or wanting "a la carte programming options" and the emergence of options like iTunes, Netflix, Amazon Prime, Hulu, and most recently HBO Now, shows that the reality of that possibility is on the way.

    Like most of us, I don't watch anywhere close to all that comes in my cable (Uverse) subscription. There are channels I'm sure I've never watched. With budget in mind, we don't pay the extra for premium movie channels or additional packages. We do pay for Netflix and Amazon Prime and are enjoying what those services provide. I do stay on top of our billing with At&t and speak with customer service to get the best possible deal available and our cable and internet bill at present is around $125 a month. Do I want more for less, you bet I do.

    I wonder though... is this one of those situations in life where "getting what you want" is going to "cost you in the end". The traditional entertainment model has been supported by advertising through commercials and all of us complain about commercials. Getting a DVR years ago completely changed my watching habits and patterns (I could finally skip commercials, awesome!). Those routines have changed even more with the ability to "binge watch" shows on Netflix and similar services (No commercials and I don't have to wait for new episodes each week, double awesome!). We sure do love our immediate gratification don't we. :D

    My concern is that the new model of media delivery is ultimately going to be more expensive than our current model. HBO Now is $15 a month. Netflix is $8+ a month. Amazon Prime is $99 a year. The new rumored Apple TV service is estimated to be around $30 or $40 a month. I looked at the new season of a popular show on iTunes and the season pass was $25. If I get two shows a month then I'm paying more than what I pay now for the entire cable television part of my bill and that's just to watch two shows. When you start adding up all the individual fees it seems very likely that just "watching what I want to watch" is going to end up costing me way more on a monthly basis then what I pay now. And, let's not forget I'm still going to have to pay a service provider for internet so that I can access all of my a la carte choices.

    All the major players are starting to create their own content instead of just being a vehicle for the media content of others, HBO, Showtime, Starz, Netflix, etc.. I've heard that Amazon Prime is actually producing pilots of original content and letting viewers vote on which shows will actually make it to production. In my general cable package we enjoy programming from BBC, AMC, Food Network, MTV, Comedy Central, History Channel, Nat Geo, ESPN, HGTV, etc.. If all of these networks went the route of HBO Now then there is no way I would be able to afford them all.

    Ultimately, if the support of the advertising dollar is going to go away then the premium for content is going to go up. I think the film industry is a good example of this. Seeing a movie is getting direct access to premium content with no commercials. We all remember when you could see a movie for a few bucks, but now the cost of a ticket can easily be $10+. I think bundling is going to be necessary in some form in order to keep costs down. It will be interesting to see how all of this plays out.

    What do you think?
     
  2. Huntn, Apr 21, 2015
    Last edited: Apr 21, 2015

    Huntn macrumors G5

    Huntn

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    #2
    Netflix a single provider is a tremendous deal as compared to bundled cable services when it comes to quantity and quality of content and also as compared to a single network like HBO. As a subscription to watch recent movies, HBO is a failure. With exclusive programming like Daredevil, Netflix and streaming competition like Roku and Apple TV represents significant downward price pressure on Cable companies and dedicated networks like HBO.

    However, I will still pay $15 a month for the 12 episodes (3 months) of the current Game of Thrones season. That is a pretty premium for a single show, but if broken down to having to delay watching until just prior to the following season, and buying single streamed episodes, it's a wash price-wise, but a plus from being able to watch current episodes.

    Cable companies currently represent over priced streaming services. I predict they will undergo a huge upheaval, and will have to start offering reasonably priced ala carte pricing to remain something more than vanilla internet providers. The Netfix advantage is that it does not need a cable company, just internet access, and the entire country (world?) is their customer, not smaller staked out regions.

    Does Amazon have any dedicated programming? At $8 a month for 2 day shipping plus a selection of free Prime movies, it's an acceptable deal. I like having not to accrue $35 worth of merchandise to avoid the shipping charges.
     
  3. Scepticalscribe Contributor

    Scepticalscribe

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    #3
    Extraordinarily interesting and thought provoking post.

    These past two decades, I have watched hardly any TV, and never have it on 'casually' in the background channel hopping. I make a point to watch the very few things I want to see, news, current affairs, some documentaries, and occasional TV dramas.

    However, I get a lot of my news online, - from international sources - and subscribe to quite a few periodicals (both online and 'hard' copy).

    I don't doubt that TV is changing, and that these changes have been largely brought about due to dramatically altered patterns of viewing, especially among a younger demographic. I suspect that it may be about to get ever more atomised in the future.

    While I see your point about costs, this may also serve to compel some TV channels to focus a little more on making quality programmes in the hope of attracting audiences; but then again, quality 'costs', and much of this, for too long has been about profits, and anticipating what will resonate well with an audience…..
     
  4. Tomorrow macrumors 604

    Tomorrow

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    #4
    I think we're headed in that direction, but I think we have a LONG way to go.

    So many people hail Netflix as the be-all, end-all of streaming services. I have a subscription myself, but their selection, at least for my tastes, is absolutely dismal. Whenever I search for a movie or TV show I'd like to watch, I get a hit on about 1 out of every 20 or so searches. So the content just isn't there for me, at least not yet.

    I would ditch cable completely if I were single, but my wife and son seem to love it. There just isn't enough programming out there to make it worthwhile to me, if it were just me.
     
  5. mscriv, Apr 21, 2015
    Last edited: Apr 21, 2015

    mscriv thread starter macrumors 601

    mscriv

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    #5
    http://studios.amazon.com/amazon-originals/series

    http://en.wikipedia.org/wiki/List_of_original_programs_distributed_by_Amazon

    http://en.wikipedia.org/wiki/Amazon_Studios

    Why thank you Scepticalscribe. I applaud your media consumption habits. I know that I spend way too much time in front of a screen when I could be doing more productive things. I've read many of your posts regarding your television and movie tastes in those respective threads and I think some of these newer shows you would really enjoy.
     
  6. impulse462 Suspended

    impulse462

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    #6
    I agree. I don't think TV itself is changing..just the means to access programming.

    But (I think) at the crux of the issues is that when I had a cable subscription, I watched only 10% of the channels offered on it. While HBO Now+Netflix+amazon may add up, I'm at least watching a lot of the content (in my case it's just netflix and hbo). I would rather have that option than be forced to pay for something I never watch.
     
  7. Huntn macrumors G5

    Huntn

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    #7
    Ten percent or less for me. Over 100 channels and I watch about 6 channels regularily. Ah, the good ole days when a cable subscription ran $15/month. ;)
     
  8. Scepticalscribe Contributor

    Scepticalscribe

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    #8
    Before the advent of cable TV, television pretty much had things its own way, and, even then, the TV stations were able to adapt - to a large extent - to cable.

    However, these changes are much more far reaching, and will test their survival instincts, their commercial savvy, their ability to read (and anticipate) popular taste, and their artistic and creative abilities to the utmost. And no bad thing.

    However, personally, I would hate to see public service broadcasting made a casualty of these (inevitable) changes.
     
  9. Meister Suspended

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    #9
    I stopped watching TV 15 years ago. It was a dead medium by the end of the nineties.
     
  10. mscriv thread starter macrumors 601

    mscriv

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    #10
    *bold emphasis mine

    This is the argument that is used most often, but I don't know how realistic the logic behind the argument truly is. Yes, with cable we are paying a bundle price and the bundle does come with channels we might never watch. Thus, the logic behind the argument is as follows... "if I'm only watching 10% of what is in my bundle then let me just get those specific channels and paying just for them should greatly reduce my bill". Impulse462, I'm not saying you specifically are saying this, but I've heard others use the a la carte concept as if it's some kind of formula. For example, "if I only watch 20% of the channels in my package then just give me those channles and reduce my bill by 80%". From what I understand about the cable market each channel has their own terms and associated costs. It's not a simple 1:1 as if all channels in a bundle are of equal cost and value.

    Plus, media is not a perishable product and thus it's not truly as if anything is being "wasted or lost" when a specific channel goes unwatched. Dont' get me wrong, I know the media companies specifically put certain stations in certain packages, but that's how business works. You have to pick the package that includes the specific channels you want knowing that you are not going to watch some of the included fluff. The idea that a la carte programming is gonna look like picking your specific 15 favorite stations and pay $1 or $2 per station for an individualized package is a pipe dream. I don't believe media delivery will ever work that way. In almost every industry a la carte pricing is always higher than bundle/bulk pricing.

    I think this is why we are starting to see servics like Netflix and Amazon come up with their own original programming. They are trying to add value to their service by having exclusive shows that can only be seen if you are one of their members. With that being said, I wonder financially what that really lookes like. This article from 2013 breaks down some of those numbers and shows how Netflix needs their original content to bring in new subscribers in order to justify its expense. I could easily see the trend in original programming leading to an increase in the costs of services like Netflix. Amazon Prime raised their rates last year and HBO Now has set a price point that is almost double what Netflix currently charges. Many music streaming services cost more on a monthly basis than Netflix at present. This makes me think a price increase is probably going to come at some point.

    And again, I say all of that, simply to state that the pay just for what I want model of media delivery is likely going to ultimately cost the consumer more than the current cable model we have if everything goes the way of individual streaming and access. I understand that businesses are in the game to make money, but I hope we find a way to give the consumer the access they want to media without raising rates overall. The media industry needs someone to shake up the market like T-Mobile has shaken up the telecom market.
     
  11. impulse462 Suspended

    impulse462

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    #11
    It's not true a la carte though. True a la carte is me buying a season pass of House on iTunes and watching each episode as it comes out. That's what I would to be honest, but I got HBO now because I like a lot of their programming. Also with some shows like Game of Thrones and Black Sails, they don't release the episode the day after it airs...they release the season literally 11 months later, 1 month before the next season is about to air. I had to endure the game of thrones facebook throw obnoxious statuses such as "EXPERIENCE SEASON 4 FOR THE FIRST TIME EVER!!!" literally 1 month before season 5 aired. So yeah sure I could wait...but I'm not gonna do that.

    Point being that at least with these services I'm more likely to pay for what I want to watch. You're right, netflix has a huge back catalog of which I probably won't watch much. I guess I'm paying for the ability to watch it anytime anywhere on any device.
     
  12. Huntn macrumors G5

    Huntn

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    #12
    I don't know what kind of margins the cable companies operate on, but if I'm watching less than 10% of the channels, I imagine that while I might not save 90% going to alacarte, I would likely save 35-50%. There has to be an excuse for the cable companies to charge large fees for content, and a willingness for the consumer to subsidize content they never watch. I've hit my limit and am actively seeking means to reduce my expenses.
     
  13. mscriv thread starter macrumors 601

    mscriv

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    #13
    * bold emphasis mine

    To clarify, what I'm thinking/meaning when I say "a la carte" is the ability to directly get media content from the content creator/provider. HBO Now or Netflix would be the best example of this. I'm specifically paying HBO or Netflix directly to have an account to access their catalog. Thus, I was thinking "a la carte" in terms of networks/providers as opposed to individual shows. For example, HGTV could decide to go the HBO Now route and charge $10 a month for me to have access to all the shows their network airs. If media delivery ultimately goes "a la carte" in this fashion then it will definitely be more expensive for the conumer as opposed to bundling/packaging.

    I think you "hit the nail on the head" when you reference the "ability to watch it anytime on any device". With the TV no longer being our only screen option then we are paying for the ability to view our media on the screen of our choosing. This is an added value for which media providers will charge a premium. And, as we've already discussed with our immediate gratification focus this is a perk most folks are willing to pay more for as opposed to the traditional model of content delivery.

    * bold emphasis mine

    I definitely think most people feel the way you do and that's why there is pressure for the market to change. However, as I've stated I honestly don't know that the a la carte "answer" is a viable method for ultimately lowering consumer cost. I do believe that we as consumers can successfully lower our costs for media content, but I think that goal is truly accomplished when we get to the point that we are willing to make sacrifices in our viewing habits. For example, I've seen many folks on MR share that they have "cut the cord" and now only do Netflix or Hulu. They have definitely succeeded in lowering their monthly media expense, but in order to do so they have also greatly limited what they have the ability to view. Now, if everything they want to watch is available to them by making that change then great, but that is not the case for everyone. It is certainly not the case for sports fans who want to watch live sports.

    Let us know about your efforts to lower your costs. I think this is definitely an ongoing discussion and we can learn a lot from each other as we share the various strategies and cost saving measures we are using.
     
  14. FieldingMellish Suspended

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    #14
    I submit that I am watching more interesting and quality programming on my own schedule, via Netflix and Apple TV, than before with a full cable suite and HBO. Not a sports fan, so no need for cable. I choose to wait out when Game of Thrones comes out on Bluray and enjoy superior picture and sound, along with free digital copies of it for phone or tablet. The PBS app on Apple TV is wonderful.
     
  15. impulse462 Suspended

    impulse462

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    #15
    This is the crux of the issue, and I could not agree more. I watch more quality television than I did before when I had cable..and because it is on my own time, I free up more time for other activities. I'd include HBO though, since I didn't have it until HBO now was released.
     
  16. MacNut macrumors Core

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    #16
  17. Meister Suspended

    Meister

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    #17
    I haven't watched TV since the nineties. I am surprised it still exists.
    In europe this is due to it being force financed.
     
  18. Happybunny macrumors 68000

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    #18
    What I have noticed over the last decades, is that as my TVs gets bigger, and my selection of channels gets ever wider, I myself watch less and less.
     
  19. AustinIllini macrumors demi-god

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    #19
    ESPN and cable companies have an uneasy truce. Cable companies pay something like $7.00 a month per subscriber to ESPN. That's a ton of dough. On the other hand, ESPN could go completely a la carte and put serious pressure on the cable companies.
     
  20. rdowns macrumors Penryn

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    #20
    I've heard numbers double that due to forcing cable operators to take on other channels. Cablevision charges all tiers a $5 a month sports fee.

    It's also not only the ESPN fee but they require cable companies to take the other ESPN channels as well as Disney's many cable channels.
     
  21. mantan macrumors 68000

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    #21
    The whole idea of bundling channels is the idea of shared costs/risks for content producers. It's a lot easier to take risks on shows with a niche audience, when you know you have the safety net of the channel bundle to help pay the cost.

    Everybody loves the pipe dream of ala carte programming bringing their favorite shows at a fraction of the cost. They are assuming the audiences for those shows/channels is enough to pay for the show or make the studios to take a chance on it. Sure, we can all binge watch our favorite shows on Netflix...but by that point, it's gravy money that's being paid on top of what it made as a first run show.

    The real challenge is coming up with a model that supports content creation for first run content in an ala carte or net distribution model. The industry is still figuring that one out.

    An unintended consequence is going to be the dumbing down of an alternative model is going to be the (further) dumbing down of content to try to appeal to the broadest audience possible....to mitigate the risk that unbundling would create.

    I have a hard time seeing a future where the world isn't going to be a mix of traditional and new distribution methods.

    And I agree with the original premise that it's unlikely to be significantly cheaper....especially if Apple is getting involved.
     
  22. FieldingMellish Suspended

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    #22
    Binge watching, to my understanding, has largely been for intelligently scripted television series over, say, reality TV. Or for humorous content that keeps ‘em laughing, regardless how often the same shows have been seen. Take Seinfeld, for instance. It’s currently up for grabs and it’s a show that ran during the nineties. I have to imagine that big players in the medium see this happening.

    The notion of the real challenge in coming up with a model that supports content creation for first run content is kind of the way it’s gone for all these years in traditional broadcast television.

    A given channel would bet the farm on a time slot, hoping that their new show will siphon viewers from the same time slot of the competition’s.
     
  23. MacNut macrumors Core

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    #23
    When ESPN is charging $7 per subscriber it kills a persons cable bill. Yes smaller channels need bundling to survive. In ESPN's case they need it to pad their bottom line.

    The model will backfire on them over time as more people cut the cord. Those that don't watch sports are the ones getting screwed. What I see happening is ala carte with smaller channels bundled and the sports channels bundled. ESPN demands carriage, the smaller networks beg for it. Disney has leverage with ESPN, they know sports fans demand it so the cable operators are forced to carry it and in turn take the smaller channels with it. Until the NFL and MLB break away from the cable channels and sell over the top the cycle will continue. But ESPN will over pay and in turn overcharge.

    Netflix is changing the game by picking up new series and doing a mass binge release. This is what scares the networks.
     
  24. Eric5h5 macrumors 68020

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    #24
    Except it did happen. Dish Network had exactly that, where you could pick 10 channels and pay $15/month. (Naturally, the premium channels such as HBO were excluded.) I had that for years, but eventually most of the shows I was watching ended, with few new shows of interest to replace them, so I dropped TV entirely. This was somewhere around 10 years ago.

    --Eric
     
  25. LethalWolfe macrumors G3

    LethalWolfe

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    #25
    The cost per 'channel' in an a la carte system will certainly be more in the same way that, in terms of price per can, buying a single can of Coke is more expensive than buying a 20 pack of Coke and that is more expensive than buying a 36 pack of Coke. Shop in bulk and you always get a discount.

    For more consideration, the WWE and the UFC both offer OTT services and they are both $10/mo. CBS has an OTT service (with commercials) that is $6/mo. So, at least for now, it looks like the going rate for a 'channel' (w/o commercials) is about $10/mo.


    As another poster pointed out, Netflix is 99% old TV shows and old movies that have a predictable value. There is incredibly little risk for Netflix compared to the movie studios, TV networks, and cable channels that pay for the original content that eventually ends up on Netflix.

    Cable companies are many times forced to by bundles from content creators (Viacom, Disney, etc.,) which is one reason why bundles get sold to end users. The Netflix advantage is that they have very little original programing which means they take on very little risk. Also, Netflix has to secure distribution deals market by market which is why it's only available in select countries (and why not all countries have access to the same content).

    Out of curiosity when you had cable did you have a DVR?

    According to my brief Google search, in 2013 TV in America did nearly $50 billion in revenue from ad sales alone. Not too shabby, IMO.

     

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