Thursday, October 30, 2014

A la carte here we come!

So cable haters have been rejoicing because there are going to be online offerings of HBO and CBS.  I posted about this a few days ago.  I have been reading blogs and commentary since then that say this is the end of bundled cable.  One in particular I found amusing was a commentary to an article about this how the poster was going to get 10 channels and by his estimation, pay about $10 for the pleasure.  So I asked him if he actually read the blog post.  If you bought just HBO and CBS at their estimated prices, you'd be at $14.  So if you figure in an average price of $7 per network, that makes his cable bill about $70 for those 10 channels.  About what he pays now to get 70+ nets through the evil bundle. 
And at the end of the day, someone still has to aggregate the billing.  Imagine going into the supermarket and writing out a check to every company that you've bought food from.
The fact is that as content moves to delivery over the internet, it may not look or feel much different than it does now.  Want ESPN, then pay $48 for the"Disney Bundle"  Want CNN?  Buy the Time Warner bundle...$29, MTV...the Viacom bundle, $35.  Now how does it look?

Content, like internet speeds, is a value proposition.  Cable rating vs broadcast keeps heading in opposite directions.  The business model of broadcast was never able to address audience fragmentation.  A la carte can, but don't believe it decreases the value of the content because anything that attracts an audience still has value.

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