Why not buy Time Warner?

[HobeSoundDarryl]

No, but then I don't feel any sympathy when they bitch and moan about piracy. They want to have their cake and eat it too. It's working for them now, but they will be forced to change their business model eventually like they had to do with music. They are literally living off of old peoples cable subscriptions. 300 channels and nothing to watch.

Why should I have to pay $100 a month for cable just to get Game of Thrones? I'll just buy it on itunes, oh wait, it's not available there until 9 months after it airs? Gee, I wonder where else I can find it?

If everyone would adopt the "I'll just pirate it" mentality, the lack of money flowing through would mark the end of production. The money must flow to pay the people that create the shows. It must flow to motivate the entrepreneurs who take huge risks on brand new shows so that 1 out of every 20-100 might get picked up (that's wasting a lot of money on 19-99 failures to get each hit). It must flow to motivate companies to keep shows like Seinfeld alive long enough to find it's audience (look it up).

We'll sling a Netflix to counter but the vast majority of Netflix is already in-the-can productions. And the gripe about Netflix is that it is heavy on the old and heavy on the "B" movies: "where's the new stuff?" The new stuff is being made now, being paid for now. Salaries of all of the artists involved in making the new is being paid now. Marketing for the new is being spent now. The subsidies of commercials running during the shows (including the commercials on the "200 channels I never watch") are other peoples money helping to fund the creation of the new shows we want to watch now.

Kill that revenue flow and it kills the shows. 2 things here: 1) We already have cheap and free productions available for free- see youtube. 2) I notice in most scifi, there is no television. For example, in most of Star Trek, you see the crew putting on plays to entertain each other. Or there is a movie night and they are watching old movies already in the can, so maybe Netflix is still around in the 23rd century?

The point is, yes, while there is some greed in the existing model, this dream of getting everything we want for nothing or near nothing means the bulk of the money that pays to make everything we want vanishes. If it does vanish, do the artists continue to make it anyway?

Just saw Dawn of the Planet of the Apes this weekend and hung around for the credits at the end. All those names flowing by were generally paid to make that <3 hour film. In this "just pirate it" or "$5 or $10 for just the channels I want to watch" dream world, do all those people still make something like that? How are they paid to make it? Or does the cash stream getting cut by 80%, 90% or more per this al-a-carte mentality yield a similarly stark cost of production cut too so that we end up with much cheaper productions like more reality television and/or much of what can be seen on youtube and similar?

I'm certainly not saying the current model is perfect but it does yield a lot of value for what it costs. I too have about 10-15 core channels I'd probably want in some al-a-carte package but I sometimes find something on those other 185-190 channels "I never watch".

I get my al-a-carte package by using the technology at hand. Set up a favorites list that is just my favorite channels and I can't even see the 185 channels "I never watch". Yet the commercials running on those channels are other people money helping to subsidize what I am watching on the channels in my favorites list. And when my favorites have nothing to watch, I can click "all" and see if there might be anything on those other 185 that might be worth watching. Often there is something.

Since I have the mentality that the rest of the chain is going to get theirs either way (that 200 channels at $70/month would evolve into 15 channels at $90/month if al-a-carte has any chance of being adopted), I think I'd prefer the "as is" to the dream. Of course, if there would be some way to get everything I want to watch, commercial-free, for a fraction of what I pay now, SURE, I'd love it. But I also want gas to cost a nickel, food to be free, iPhone 6 to cost $1 and no taxes. I think all those have about the same chance.

 

[2010mini]

If everyone would adopt the "I'll just pirate it" mentality, the lack of money flowing through would mark the end of production. The money must flow to pay the people that create the shows. It must flow to motivate the entrepreneurs who take huge risks on brand new shows so that 1 out of every 20-100 might get picked up (that's wasting a lot of money on 19-99 failures to get each hit). It must flow to motivate companies to keep shows like Seinfeld alive long enough to find it's audience (look it up).

We'll sling a Netflix to counter but the vast majority of Netflix is already in-the-can productions. And the gripe about Netflix is that it is heavy on the old and heavy on the "B" movies: "where's the new stuff?" The new stuff is being made now, being paid for now. Salaries of all of the artists involved in making the new is being paid now. Marketing for the new is being spent now. The subsidies of commercials running during the shows (including the commercials on the "200 channels I never watch") are other peoples money helping to fund the creation of the new shows we want to watch now.

Kill that revenue flow and it kills the shows. 2 things here: 1) We already have cheap and free productions available for free- see youtube. 2) I notice in most scifi, there is no television. For example, in most of Star Trek, you see the crew putting on plays to entertain each other. Or there is a movie night and they are watching old movies already in the can, so maybe Netflix is still around in the 23rd century?

The point is, yes, while there is some greed in the existing model, this dream of getting everything we want for nothing or near nothing means the bulk of the money that pays to make everything we want vanishes. If it does vanish, do the artists continue to make it anyway?

Just saw Dawn of the Planet of the Apes this weekend and hung around for the credits at the end. All those names flowing by were generally paid to make that <3 hour film. In this "just pirate it" or "$5 or $10 for just the channels I want to watch" dream world, do all those people still make something like that? How are they paid to make it? Or does the cash stream getting cut by 80%, 90% or more per this al-a-carte mentality yield a similarly stark cost of production cut too so that we end up with much cheaper productions like more reality television and/or much of what can be seen on youtube and similar?

I'm certainly not saying the current model is perfect but it does yield a lot of value for what it costs. I too have about 10-15 core channels I'd probably want in some al-a-carte package but I sometimes find something on those other 185-190 channels "I never watch".

I get my al-a-carte package by using the technology at hand. Set up a favorites list that is just my favorite channels and I can't even see the 185 channels "I never watch". Yet the commercials running on those channels are other people money helping to subsidize what I am watching on the channels in my favorites list. And when my favorites have nothing to watch, I can click "all" and see if there might be anything on those other 185 that might be worth watching. Often there is something.

Since I have the mentality that the rest of the chain is going to get theirs either way (that 200 channels at $70/month would evolve into 15 channels at $90/month if al-a-carte has any chance of being adopted), I think I'd prefer the "as is" to the dream. Of course, if there would be some way to get everything I want to watch, commercial-free, for a fraction of what I pay now, SURE, I'd love it. But I also want gas to cost a nickel, food to be free, iPhone 6 to cost $1 and no taxes. I think all those have about the same chance.

Hey! Logic and Internet forums don't go together!!! So quit it! Lol

 

[HobeSoundDarryl]

Sorry, if there's one thing I keep forgetting, it's that rule. So for the rest of you…

rah, rah Apple! Buy Time Warner so that you can then discount the service of subscription television to near nothing while still getting a great return on your purchase and motivating the rest of the players to keep cranking out the new programming for a fraction of what they make from TW now.

Wait, that doesn't sound genuine- or likely- either. Retry…

rah, rah Apple! Can't wait to get everything I want commercial-free for next to nothing!

There we go.

Wait, my area is served by Comcast, not Time Warner. And I have DirecTV instead of Comcast for television service. So…

rah, rah Apple! Buy Time Warner, Comcast, DirecTV, et all, then thoroughly discount those services while still getting a great return on your purchases and motivating the rest of the players to keep cranking out the new programming for a fraction of what they make from TW now.

No. It seems I just can't get it right. How about just…

rah, rah Apple!

 

[BaldiMac]

Wait, my area is served by Comcast, not Time Warner. And I have DirecTV instead of Comcast for television service. So…

rah, rah Apple! Buy Time Warner, Comcast, DirecTV, et all, then thoroughly discount those services while still getting a great return on your purchases and motivating the rest of the players to keep cranking out the new programming for a fraction of what they make from TW now.

Again, Time Warner (which is what the OP was about) is a different company than Time Warner Cable.

 

[HobeSoundDarryl]

I understand. I understood it the first time.

Whether a library of video from Time Warner or if it was the cable service, an Apple-driven al-a-carte revolution is either Netflix-like and/or trying to be a new kind of competitor to cable/satt. Either way, I don't see the al-a-carte dream as it's often framed (where we are getting everything we want, commercial free, for a fraction of what we pay now).

I can see it if the source of the revenues pays more. But if the source (us) pays less, somebody else in the chain takes the hit. I think some of us think that someone else is the cable/satt company but if Apple is the savior, that's just subbing one middleman for another. And the problem with that is that the cable company is likely still the source of broadband on which this magical Apple solution entirely depends. So even if Apple could be the new middleman, cable can make up for it's losses with higher broadband rates.

If it's the full al-a-carte dream, Apple needs to become Netflix AND Time Warner Cable, meaning having access to a lot of in-the-can productions as well as being a source of the new. Apparently, they are to achieve this while getting their cut, through pipes likely owned by the Cable company they would replace. The subsidy revenue paid by others paying for commercials on 180 channels "I" never watch will just evaporate. The Studios will apparently continue to crank out all of what makes up what "we want" and still be motivated to gamble HUGE on brand new pilots too... but somehow we- the source of the money that holds it all up- will get a huge discount on what we pay now.

Personally, I love the whole idea. I just don't see how it can work unless we throw more money into the pot to motivate the change. I get why we consumers want it but I can't see why the other players should be motivated.

 

[BaldiMac]

I understand. I understood it the first time.

Then why did you refer to TWC as Time Warner in a thread about Time Warner? Needlessly confusing.

Whether a library of video from Time Warner or if it was the cable service, an Apple-driven al-a-carte revolution is either Netflix-like and/or trying to be a new kind of competitor to cable/satt. Either way, I don't see the al-a-carte dream as it's often framed (where we are getting everything we want, commercial free, for a fraction of what we pay now).

I can see it if the source of the revenues pays more. But if the source (us) pays less, somebody else in the chain takes the hit. I think some of us think that someone else is the cable/satt company but if Apple is the savior, that's just subbing one middleman for another. And the problem with that is that the cable company is likely still the source of broadband on which this magical Apple solution entirely depends. So even if Apple could be the new middleman, cable can make up for it's losses with higher broadband rates.

If it's the full al-a-carte dream, Apple needs to become Netflix AND Time Warner Cable, meaning having access to a lot of in-the-can productions as well as being a source of the new. Apparently, they are to achieve this while getting their cut, through pipes likely owned by the Cable company they would replace. The subsidy revenue paid by others paying for commercials on 180 channels "I" never watch will just evaporate. The Studios will apparently continue to crank out all of what makes up what "we want" and still be motivated to gamble HUGE on brand new pilots too... but somehow we- the source of the money that holds it all up- will get a huge discount on what we pay now.

Personally, I love the whole idea. I just don't see how it can work unless we throw more money into the pot to motivate the change. I get why we consumers want it but I can't see why the other players should be motivated.

That was all pretty clear from your previous posts in this thread. 🙂

Personally, I see plenty of room for negotiation by cutting out the cable company. Obviously, you see a lack of broadband competition as an almost insurmountable concern, but I see that as simply one more problem that needs to be addressed in moving forward to a new model. Net neutrality is important. Overturning state bans on broadband competition by public utilities is important. A strong FCC and DOJ commitment to preventing consolidation and protecting new competition is important.

(And I think Disney is the most important piece of the puzzle. Apple's relationship with them is important. Untying ESPN from cable packages would change everything.)

 

[HobeSoundDarryl]

Then why did you refer to TWC as Time Warner in a thread about Time Warner? Needlessly confusing.

Because the bulk of conversation in this thread went there and, relative to the al-a-carte topic from my own perspective, it didn't matter. Buy the Time Warner library to take a step toward being a Netflix competitor (except by owning a bunch of content) AND/OR buy cable companies so that the new programming piece of the al-a-carte dream can be fed. Either way, I just don't see it.

Personally, I see plenty of room for negotiation by cutting out the cable company. Obviously, you see a lack of broadband competition as an almost insurmountable concern, but I see that as simply one more problem that needs to be addressed in moving forward to a new model. Net neutrality is important. Overturning state bans on broadband competition by public utilities is important. A strong FCC and DOJ commitment to preventing consolidation and protecting new competition is important.

I'll respect that view of it but I have little faith that the Government would do anything to help this (unless there was more money in it for the Government). Where else does the Government flex it's muscles to get consumers huge discounts by forcing the change of existing business models? In this ball park, the last thing I can think of is the AT&T breakup back in the 80's (which has mostly been undone since). For example, a strong FCC could put the pressure on the cost of cellular service which I see as a good proxy for cable subscription in this al-a-carte discussion. There's often stories of city-wide wifi installation initiatives to bring free/cheap wifi to all, followed by resistance from the established sources of broadband, followed by such plans being dropped. I don't hardly ever see it working that the Gov flexes to help the consumers at the expense of big business in this tech sector.

That aside though, I can certainly agree with you that there is plenty of room for negotiation. In anything where there is a perception of fat profits by greedy players, there is likely room for less greedy players to come in and take less fat profits. In this case however, if Apple is that competitor, their replacement depends on pipes owned by Time Warner, Comcast, etc. So even if Apple wanted to become the new cable TV middleman and waive any profit currently taken by the Comcast Cable TV middleman, Comcast, etc still owns the pipes. Just as AT&T, Verizon, etc justified "tiered" cellular with "for heavier users", I can easily see the cable companies spinning the very same argument in support of making up the losses on the TV side with higher broadband rates "for heavier users".

Thus, I don't see it. I only see al-a-carte flying if someone can come up with a way that the players beyond us consumers make more money than they do in the existing model. Subbing out a Comcast for an Apple doesn't make me envision Apple generously waiving nearly all of what a Comcast makes (but, even if they did, that's still not the path to 80%-95% discounts of what we consumers pay now). To get that kind of discount, ALL of the other players in the chain have to take a big haircut. Yet, "we" keep dreaming it that way- get exactly what we want, often commercial-free, with Apple getting to pile in and take their cut for a steep discount of what we pay now. Love the idea but can't see it when I put on a hat not labeled consumer.

 

[BaldiMac]

In this case however, if Apple is that competitor, their replacement depends on pipes owned by Time Warner, Comcast, etc. So even if Apple wanted to become the new cable TV middleman and waive any profit currently taken by the Comcast Cable TV middleman, Comcast, etc still owns the pipes. Just as AT&T, Verizon, etc justified "tiered" cellular with "for heavier users", I can easily see the cable companies spinning the very same argument in support of making up the losses on the TV side with higher broadband rates "for heavier users".

Again, that operates on the assumption of a continued lack of competition. I'm saying that a lack of competition needs to be addressed. If you assume things won't change, than it's pretty easy to come to the conclusion that things won't change. 🙂

Thus, I don't see it. I only see al-a-carte flying if someone can come up with a way that the players beyond us consumers make more money than they do in the existing model. Subbing out a Comcast for an Apple doesn't make me envision Apple generously waiving nearly all of what a Comcast makes (but, even if they did, that's still not the path to 80%-95% discounts of what we consumers pay now). To get that kind of discount, ALL of the other players in the chain have to take a big haircut. Yet, "we" keep dreaming it that way- get exactly what we want, often commercial-free, with Apple getting to pile in and take their cut for a steep discount of what we pay now. Love the idea but can't see it when I put on a hat not labeled consumer.

I think you are twisting the numbers to fit your point by 1) looking at it from an industry wide perspective, and 2) assuming absurd discounts for consumers.

1) The whole industry doesn't need to make more money to make a change, just individual companies. And a potential 30% cut by a company like Apple instead of the 50% cut by cable companies would be a huge incentive. That's a 40% revenue increase per subscriber for content providers.

2) Why "80%-95% discounts"? Cherry picking an extreme position and assuming it across the board seems to have all the makings of a logical fallacy.

 

[HobeSoundDarryl]

Again, that operates on the assumption of a continued lack of competition. I'm saying that a lack of competition needs to be addressed. If you assume things won't change, than it's pretty easy to come to the conclusion that things won't change. 🙂

Where do you see Government-driven initiatives that inject competition resulting in significant discounts for consumers? Love the idea- I even think that's part of how Capitalism is supposed to work- just don't see it lately in practice. What's a recent example where the Gov flexed injecting this competition that yielded meaningful price reductions for consumers?

I think you are twisting the numbers to fit your point by 1) looking at it from an industry wide perspective, and 2) assuming absurd discounts for consumers.

1) The whole industry doesn't need to make more money to make a change, just individual companies. And a potential 30% cut by a company like Apple instead of the 50% cut by cable companies would be a huge incentive. That's a 40% revenue increase per subscriber for content providers.

I didn't say "the whole industry". When I said the other players, I generally meant the other players in the chain: Studios, middle men (like cable/satt now, Apple in the dream), consumers.

So let's say Apple plugs in as new middleman and forgoes that 20% in that 50%-30% you suggest. 1) Why do they do that? (why don't they want the full 50% or 48% or 45%?) 2) When have they ever done that before while delivering what they spin as a superior alternative? 3) Why doesn't cable make up for the loss with higher broadband rates? (I just don't see the Government stepping in and not allowing them to price their services as they see fit).

2) Why "80%-95% discounts"? Cherry picking an extreme position and assuming it across the board seems to have all the makings of a logical fallacy.

Every one of these "al-a-carte" and "new TV sub model" threads tend to be packed with lots of people wanting everything for about $5-$15/month. A few have posted about a willingness to pay as much as the rumored $29/month rate for an Apple "everything" replacement model. I rarely see anyone posting about paying the same or only a slight discount. Even the realists that recognize it can't happen with the huge discount usually get to the point of wondering why they would want to pay the same or a slight discount for 15 chosen channels instead of just sticking with the "as is" for 200 channels: sometimes there IS something on those 185 channels "I" never watch.

Even earlier in this very thread, there's a guy who's read somewhere that his cable provider pays $1.40 per customer for ESPN and that others pay 25 cents for ESPN. He's wanting al-a-carte so he can pay 25 cents or $1.40/month for ESPN. Extrapolate that thinking to a al-a-carte 10 channels priced as high as ESPN and he's wanting to pay $2.50-$14/month, 15 channels at $3.75-$21 per month. Of course, ESPN tends to be the tentpole cost shared in such articles so he probably knows that lots of other channels cost pennies per month bundled within cable deals. If so, I doubt he wants to buy his 10 for up to $14 or 15 at up to $21/month; he's probably thinking it should cost less than that. But it's a good example of how people think about al-a-carte that one can go read in this same thread.

I calculate the 80%-95% by taking the national average monthly cost which is often quoted at about $70 to as much as about $100 and do the math: $10/$85 = 11.7%. If that is exactly the right math, "we" are looking for a 89.3% cut in what "we" pay. If you know those numbers more precisely, please share and we can go with your calculation.

 

[ApfelKuchen]

The US public is very used to "I want to pay only for things I get, I don't want to pay for something the other guy gets." There's very little analysis as to how pooled resources (health insurance, tax-funded disaster relief, universal public education, infrastructure investment, giving the poor money that they can spend at local stores and give to the landlord) work to nearly everyone's benefit. Buffets are almost always cheaper than a la carte establishments. American-style freedom comes at a very high cost.

But practically speaking, the only way there's the kind of financial shift we're talking about happens is when there's a disrupter in the marketplace. Someone else comes up with a solution, and the existing players get dealt out (to one degree or another). We may get a la carte, but a la carte sources from overseas at lower cost. We may get a la carte via a medium that doesn't yet exist (the next WWW). Maybe we don't get US football anymore. Maybe we get it from a Middle East that realizes it can channel the aggressive elements of its society onto different paths.

If the status quo is not challenged, there's no reason to voluntarily take a smaller cut. If you want the same stuff, only cheaper... somebody else has to be offering something different.

 

[nep61]

Ala carte is not happening. At least not the way you think. The closest you are getting to ala carte is the iTunes Store where you can purchase only what you want to watch.

Agreed....
Even the best Ala Carte scenario would cost cable subscribers / viewers more per month than they currently pay. It's cheaper to get 110 channels for one fee each month than it is to subscribe to 7 or 8 channels for that same period.