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[Online Content Delivery] Serialized Content Distribution vs. "Content Dumps", and More
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Would HBO GO even let me watch The Wire, or any older original HBO content?
Okay, this at least makes it a little better.
Now to just uncouple it from the cable channel and give it a single-digit-per-month pricetag...
That's something I've been wondering about since ABC announced they would testing live streaming in select markets. You still need a cable account to access it, but they've got to be toying with the idea of charging their viewers directly. The biggest hurdle to online-only distribution right now is the ubiquity, or lack there of, of smart TVs; but there will come a day when every living room will be able to stream a TV show just as easily as tuning into a cable broadcast. So what happens then? If the networks (and their subsidiary channels) pull out and say "Fuck it, Hulu Live: $19.99/month", do the cable companies close shop and become full time ISPs? Without the draw of the networks, I see cable companies losing a lot of revenue, and maybe then they can't afford to keep the premium channels from following suit. Without the networks OR the premium channels, I don't see cable having any purpose beyond an ISP.
Seems inevitable, but also awesome, so I'm afraid to hope for it.
The future is now!
The problem is the TV market works the other way round. The Cable companies fund the production of TV content through affiliate fees. Networks work differently but there are also not many of them.
Here's a good rundown on the nature of the TV market:
http://abovethecrowd.com/2010/04/28/affiliate-fees-make-the-world-go-round/
Smart TVs are not the obstacle here.
They dont' want to charge their viewers directly. They'd rather let someone else do that (ie - the Cable Company).
Mostly because my watching habits are erratic, and I tend to lose interest relatively fast. And I have no one to speak to these shows about.
http://battlelog.battlefield.com/bf3/user/Mort-ZA/
@MortNZ
http://steamcommunity.com/id/mortious
This sounds like an argument very similar to the one against piracy.
"Every game pirated is a lost sale."
Like I'm not at all tempted to pay Comcast $texas on top of what I already pay them for Internet, literally just for one show (in my case, Game of Thrones) or one channel's original programming. I doubt I'm alone in this position. Keeping HBO GO behind the premium cable paywall has not forced me to cave, and will not anytime in the near future.
So the only argument left is people who could potentially jump ship and drop their cable HBO subscription if HBO content is available online for a nominal fee. Because there's no actual data to work with here, I have to go on my speculation... and it says that the number of people for whom this is true is not enormous. According to this page, HBO alone costs $20/mo on Comcast. So all that dropping the channel for HBO GO would net you is $10 off your monthly bill.
This also assumes HBO can't find some ad hoc model where they literally only let you stream a single show for a nominal fee. This cannibalizes their cable channel to a much smaller degree.
Ultimately the bean counters at HBO are very smart. If they still can't find a way to make money, or to justify some loss in exchange for word-of-mouth value, then I guess it just isn't there. Personally, I just can't see their reasoning.
Affiliate fees are bananas.
On the one hand, getting the customers to pay you directly for internet video would be nice, but being able to demand Comcast pays you the same thing for the privilege of providing your customers better video sounds much better.
It's nothing like the piracy argument. It's not about lost sales or anything.
It's about the fact that HBO's revenue primarily comes from people buying HBO as an upsell from their general cable package. And the cable companies are the ones that spend money upselling those customers to HBO. Cable companies get people to buy HBO and HBO convinces some people to get cable and also cable companies get a piece of that HBO-addon price. (ie - the cable company pockets some percentage of your $20)
If HBO offers their service outside the cable package, suddenly they are undercutting their business partners (ie - cable companies) by violating their part of the agreement. And the cable companies will then stop upselling people to HBO in retaliation and HBO loses ALOT of money. Basically, all of the money. This isn't even supposition, the cable companies have literally put the knife to HBO's neck on this matter in the recent past.
So, basically, HBO has no interest in pissing off the cable companies and for a very good reason. Because if they even start inching in that direction, the cable companies will fucking cut them.
Selling directly to customers is also a much bigger pain in the ass for HBO, who then have to maintain subscribers and do all their own advertising and all that shit. It's a high risk, low reward way to go for HBO.
My only guess is that the cable companies pressured them into not throwing that stuff on Netflix, because from where Im standing (a place of little to no actual information) it seems like a stupid move.
EDIT: As for content dumps, I think its great for old programs and can work decently for new stuff - I would have watched House of Cards week to week if I had to, but being able to power through Hemlock Grove is basically the only way I would have seen past the first or second episode.
They'd need to negotiate with Netflix for some kind of account-based control over content delivery, cause it would still need to be tied to your HBO subscription. Likely gives them more control to, which is a big thing for many content producers.