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Shocking, I know, but Disney/ESPN IS considering the post-bundle era...

Sep 1, 2005
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Going back to an argument where those who disagreed wouldn't admit that this might be realistic and change how the company views conference realignment and conference networks in the long-term....

Disney's CEO himself is saying that, yeah, it could happen. ESPN (and as a result, probably all of its smaller branches) could be sold directly to customers. It's something that their CEO is thinking about the possibility of. Given the length of contracts, using "not in the next 5 years" as a caveat isn't really a long time.

Makes me wonder how that will affect things like the state-by-state model of conference networks... as well as the ability of someone living where ever they are in the country to get the LHN.

http://www.cnbc.com/2015/07/27/disney-ceo-iger-espn-could-one-day-be-sold-direct.html
 
I saw this coming about 4 years old when I started doing some adjunct work at a community college. Kids binge watched netflix on their phones and tablets and the way they watched TV didn't fit into the traditional model. I thought to myself back then that this is the beginning of the end for the current cable business model. What you will begin to see is a proliferation of specialty networks that will be offered in some type of on demand streaming format and you may see colleges self produce and distribute their own tier 3 games. Whats not going to be there is the money. The biggest casualty is going to be the big 10 network.
 
The biggest casualty is going to be the big 10 network.

Never happen, the footprint of the big 10 network is too big and has way too many people.

Everyone can believe that the way is individual streaming channels, there is some evidence to back it up.

But I will tell you why it won't.

How many reading this has gone through a drive through restaurant and ordered the #1 meal, or the #2 meal, or the Happy meal, the kids meal or whatever meal suits your needs.

You see fast food restaurants know that if you want to sell more fries and drinks, bundle them into a nice convenient meal and you eliminate the need to make a choice. People don't want to think about what they want to buy, they want less choice and more value.

That is why we buy the meals instead of a burger fries and a drink.

That is also why the bundles will never go away.
 
Never happen, the footprint of the big 10 network is too big and has way too many people.

Everyone can believe that the way is individual streaming channels, there is some evidence to back it up.

But I will tell you why it won't.

How many reading this has gone through a drive through restaurant and ordered the #1 meal, or the #2 meal, or the Happy meal, the kids meal or whatever meal suits your needs.

You see fast food restaurants know that if you want to sell more fries and drinks, bundle them into a nice convenient meal and you eliminate the need to make a choice. People don't want to think about what they want to buy, they want less choice and more value.

That is why we buy the meals instead of a burger fries and a drink.

That is also why the bundles will never go away.


We buy the meal instead of burgers fries and a drink bc it is cheaper according to their pricing structure to get a complete meal as a bundle instead of separate pieces...that is a PERFECT analogy though... nicely put.
 
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Never happen, the footprint of the big 10 network is too big and has way too many people.

Everyone can believe that the way is individual streaming channels, there is some evidence to back it up.

But I will tell you why it won't.

How many reading this has gone through a drive through restaurant and ordered the #1 meal, or the #2 meal, or the Happy meal, the kids meal or whatever meal suits your needs.

You see fast food restaurants know that if you want to sell more fries and drinks, bundle them into a nice convenient meal and you eliminate the need to make a choice. People don't want to think about what they want to buy, they want less choice and more value.

That is why we buy the meals instead of a burger fries and a drink.

That is also why the bundles will never go away.

There is some truth to that, but there is probably going to be some sort of change in television. What will probably happen is that the TV providers will have to cut back on these huge 100+ channel bundles. They will probably have to be more selective about which channels get bundled, and offer slimmed-down packages.

On thing I completely disagree with is the evaluation of the BTN. These conference networks make their living on the fact that they are bundled in with other channels. Half the people that have the network (and pay for it) don't even watch it. If these networks can't piggyback off of other channels, the demand isn't there to make it valuable as a stand-alone channel.
 
20 years ago the average cable customer watched 15 channels, today the average customer watches about 17 channels. 20 years ago the average cable customer had about 80 channels, today its over 200. Content providers strong arm distributors into taking channels that people don't really watch for the right to broadcast channels people do want to watch. The latest example is Fox News requiring distributors to pay something like $1.30 per subscriber plus they had to carry Fox Business channel. Its driving up the cost of cable to the point where people are cutting the cord in record numbers. Advances in technology will further facilitate cord cutting and will wreck the current cable model. There will be a direct purchase option for most content within the next 10 years. Right now the big 10 network is in about 70% of cable households and cost about 50 cents unless you are in the big 10 footprint then it cost a dollar. When the direct purchase model happens how many people are going to buy the big 10 network. Not 70% of US cable households.
 
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OHHHH, right. Of course. Why didn't I (and the guys in charge of HBO, and the CEO of Disney) think of that! I' sure those guys don't know what they're talking about compared to a bunch of message board folks (no offense)!

I mean, even with your "meal deal" analogy there are a few issues. First, the king of the meal-deal, McDonalds, is currently having to rework their business model because they aren't doing nearly as well as they used to. There are several reasons for this, including health scares in some of the international markets, but here in the US they're being beset on all sides by... their competitors who are going slightly cheaper, regional competitors who are better at getting customer loyalty... and perhaps the situation most relevant here, " more upmarket "fast-casual" restaurants such as Shake Shack and Chipotle Mexican Grill, which are rapidly growing. They have been luring customers—particularly younger ones—away from McDonald’s chicken nuggets and [fries] by offering slightly better quality food, a high level of [customization] (such as the option to choose the ingredients in a burrito or burger) and some table service" (Why McDonald's Sales are Falling, The Economist). Second, you're right, if you can get a package deal that gives you a better price for something that you can't get for free or even cheaper at a comparative level of quality, then yes, I'll buy a burger, fries, and a drink. But I'm not likely to buy a "meal deal" with 2 burgers, a southwestern style burger, chicken strips, fries, curly fries, nachos, and 8 drinks just because it's cheaper than if I bought all of those individually... unless of course I intend to share them with a whole bunch of friends. And, truth be told, a lot of times these days people want water, not a drink... because... why do I need a drink? And then it comes down to pricing whether I get one just because it's cheaper or I just go with the main item. And still, back to my point about competitors, I'm way more likely to hit up Freebirds (where I get to choose what goes into my food) or P Terry's (which is a fairly cheep but local competitor) anyway.

Look, I already know a ton of people who are on the "cut the cord" or at least cut-back bandwagon. And, while some of that is because I know people who are students, some of these are fellow professionals who realize they just don't need it... or as much of it... as they used to. People with active lives who have a handful of shows that they watch know that they don't need a bazillion channels. I mean, one of my most well-off friends is excited about HBO going a la carte because for a long time he really disliked having to pay for all the extra channels that came along with it that he didn't care about. He'd actually unsubscribe as soon as Game of Thrones ended and pick back up on it when it came back on. Now? He's probably going to check out the other shows he was curious about but never cared enough about to hold on to the extra cable package. And I mean, with the way you can stream from your computer to your TV? A whole family can have one cable package and share it between a few different locations. And, as long as companies are trying to pile on all the extra crap and charge accordingly, that's going to happen. HBO, who is already one of the tighter-on-sharing channels, is probably going to feel justified in tightening up even more now that someone can just sign up for them and not have to pay for everything else that Time Warner or AT&T wants to send along with it.

Now, do I think bundling will go away completely? Nah. But Could I see a situation where "build a plan" gets more granular? Sure! Could I see a la carte becoming more prominent among the highest quality, most widely desired channels? Certainly!

Right now there are so many avenues to watch things without paying for a big bundle plan already, some more morally questionable than others, the more clunky the packages that cable providers have, the more motivation customers have to seek out other means. It used to be something that mostly college students did. But keep in mind, the college students who first learned to do that are the young professionals who are deciding whether or not they should cut the cord now. They KNOW how it can work.
 
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It's definitely moving that way. HBO has always been somewhat of an a la carte service, it makes sense that it would become purely a la carte with streaming functionality. Now HBO doesn't have to piggy back off the cable providers infrastructure. ESPN doing that would be the end of cable. I doubt they will be doing that anytime soon as I don't think there is much market for them to gain like there is with HBO.
 
Cable could really help themselves with a lot better customer service, and stop with all the extra charges. Hell half my cable bill prior to cutting the cord was HD box / DVR / Multi room DVR fees. Their rates aren't really that bad, but then you add in all the monthly rental crap and you are approaching $200.
 
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