What I want entertainment companies to give me is exactly equivalent to the result of downloading episodes from illegal Bittorrent sites plus the ability to actually pay for them.
I want a DRM-less HD video file that I can play on any computer, when I want. I want to be able to download it from anywhere I might be in the world, and my nationality should not have an effect on the availability of the content.
Heck, if HBO had a web-based tip jar, I would just pay something for every Game of Thrones episode and otherwise go straight ahead and torrent it. You know, HBO, don't "offer" me anything, just give me an option to pay you which makes my download quasi-legal, and I'll take care of the rest myself.
I want to be able to pay $0.10 to watch something once on a specific screen much more than I want to be able to play more expensive downloads on any device.
($0.10 is just a for discussion purposes number estimating the ballpark per view revenue from ad supported stuff; of course they will resist doing this, ads also make the experience worse and don't undermine purchasing the way a price near cost on demand service would)
Some parent might chime in that this would be terrible for kids videos, I'm not trying to say it should be the only way to pay.
Let's say your average HBO subscriber watches 5 shows/weeks, so 20 shows @ $15/month - the cost would have to be closer to $1.00/show to cover it ala carte, particularly as they won't have you locked into a guaranteed $15/month.
I'm not proposing to replace HBO. I think if they did offer ala carte they would have to look at their costs and then choose a revenue maximizing price. Guessing at what their subscribers would do might be a place to start with that, but I think it probably isn't very informative.
(Say the cost of delivery is $0.05. If they have 4x the customers at $0.50 as they do at $1.00, $0.50 should make lots more money. If the cost of delivery is $0.55, then obviously $1.00 makes more money than any number of users at $0.50.)
Thing is, what would be the numbers behind that? Would HBO make more money if they sold each episode separately to everyone all around the globe than it does now (= licensing the series to individual networks in every country)?
Because, an extra cost, for example, would be the subtitling. Right now it's done either from the networks that HBO sells the show rights to or from the torrent scene. HBO would have to hire people to do this job per episode, per show, etc.
> Would HBO make more money if they sold each episode separately to everyone all around the globe
They would make more than they make now, that's for sure. Because right now, there is no way for me to pay them.
> Because, an extra cost, for example, would be the subtitling.
I don't want subtitling, just because I'm from a foreign country. What little legal content consumption options I have, they always and mandatorily come with either dubbing or subtitles.
> HBO would have to hire people to do this job per episode, per show, etc.
Like I said, that's what they (or in this case you, if you work for them) think, but that's not what I asked for. I want the show, within a few days after it aired, in an open format, with none of that internationalization crap or any added "value". People who want those extra things can use any of the existing sales channels.
I want what I can have right now illegally and conveniently, made legal by paying for it.
This might not cover or replace the existing subscriber base, but it would be an opportunity to bring additional customers on board at next-to zero cost. Just by shutting up and taking my money.
They would make more than they make now, that's for sure. Because right now, there is no way for me to pay them.
But there are lots of other people that are paying them. If getting you to pay more means that all those people start paying less, then they might very well lose. Also it's worth remembering that the guy in the sofa in front of his TV is not the only HBO customer. They make money selling their shows to other TV channels as well.
> worth remembering that the guy in the sofa in front of his TV is not the only HBO customer
It's funny how those pass for prohibitive reasons why something can't happen until suddenly these reasons go away. This is exactly what happened to music downloading. There were international sales, fears of organizations competing with their own sales partners, and oh dear all those unsolvable problems that come with offering content free of DRM. Oh the horror. And then, all of that went away.
Arguing in favor of the status quo is always a safe position, because obviously you have current management on your side. That doesn't mean consumers don't have a nasty habit of breaking out of their straight jackets. There are good reasons why torrenting TV shows is so popular, and it only partially has to do with the price tag. I would argue that for most downloaders, the primary reason is actually quality and freedom from hassle.
Things are reasonably impossible until they aren't.
All that went away, but record label executives endured some short-term pain of analog dollars becoming digital pennies. They had to start signing artists to 360 deals that gave them a cut of more than just album sales. The movie and TV industries looked at the music industry and said, "We need to be careful that doesn't happen to us." Because for movies and TV, there are no live performances and so on that can make 360 deals lucrative. It's a game theory question as to what's the best thing to do. Will your utopia truly arise in the future or will it not? And Netflix is possibly the only company willing to make a real move and find out. The rest are frozen with fear that analog dollars will become digital pennies.
I'm not arguing in favor of the status quo, I am in fact very much against it. I'm simply realistic enough that I don't think that HBO simply selling their shows to the world as downloads from their website will magically lead to them making more money.
As to the music industry it responded to a serious decline in sales and for all their attempts at going digital their growth is at best pretty flat and they are still far off their pre-crash peak. So streaming and DRM-free downloads at best helped the music industry slow their decline, it certainly didn't lead to them making more money.
As you can see, there is a lot of hate towards my comments above, and most people here seem to think my thoughts are a net detriment to the discussion so I will stop posting.
I'd just like to say in closing that I want to pay money for a product I'm not getting right now. The main argument against this seems to be that by allowing me to pay for it, this product would suffer. I will bow to the majority opinion and get out of here.
The main argument against this seems to be that by allowing me to pay for it, this product would suffer.
No. The main argument against is that by setting up the infrastructure needed to let you pay for the product you want in the way that you want will probably lead to the company making less money. No one is saying that it wouldn't be nice if it worked the way you want it to work (I want it to work the way you want it to work), just that it's financially unrealistic.
> This might not cover or replace the existing subscriber base, but it would be an opportunity to bring additional customers on board at next-to zero cost. Just by shutting up and taking my money.
Except now they can no longer sell exclusive content rights to companies in each territory which means they lose a ton in license fees. So then HBO has to take over all the local marketing that each licensor was doing for them. Now, instead of collecting $1m from RomaniaTelekom with close to 100% margin, they have to set up a local office in Bucharest, contract with an ad agency, etc etc etc.
Exclusive content is a HUGE driver of consumer spend and so providers are willing to pay a TON of money for the content. Take away the exclusivity and all those big contracts go away.
You're ever going to get that, sorry. The big content providers are never going to sell you a file that you can turn around and put on Bit Torrent. DRM isn't going anywhere any time soon.
> big content providers are never going to sell you a file
This is obviously wrong in principle. The way music downloads work right now is exactly what I've been describing - music from iTunes or Amazon comes without DRM, and they allow me to purchase songs wherever I am, from wherever I am.
If your argument is those DRM-less music files don't make it onto Torrent sites, you're mistaken. Nevertheless, they sell them without DRM, because customers pressured them into it.
I buy it on iTunes, I put it into my music folder, copy it around to all my machines, it's just fine.
So I'm a German national being in France right now. If I decide to buy some music from iTunes, I click on the "buy" button and stuff starts downloading. However, if I try to purchase a TV show, it starts out by showing me only German shows. Deep down, I can find outdated US originals with subtitles - which is the best option they give me! What happens when I try to actually purchase one? "There is a problem with your iTunes account". Oops, I'm currently in the wrong country, no show for me! There is no getting around the fact that this sucks, it sucks needlessly, and to the detriment of everyone involved.
Yeah, but what's their cost for one of these files and how does it compare to an episode of...Nurse Jackie, let's say?
You might not want/need subtitling but the vast majority of the foreign fans of Games of Thrones (for example) depend on it to be able to watch. So, if HBO was ever to give "files" around just like that, they would have to make sure that they are offering something far superior to torrented content, at a cost that makes it more convenient to choose it over the torrents.
> they would have to make sure that they are offering something far superior to torrented content
I'm starting to sound like a broken record here, so this is the last time I'm going to respond to that (no offense): I want exactly the torrent file. I don't want them to pile on any of the additional crap they assume I need or should need.
Anyone who wants subtitles, or dubs, or a free rootkit, or whatever can use the existing sales channels. I want you to give me your product, as is, without any additional considerations or features, just straight up. I want the torrent file, and nothing else, no guarantees, no contracts, no nothing.
Just me giving you money for the right to legally consume what you made. Not some version of it, just the thing, with nothing added or subtracted.
You seem to assume torrenting shows is popular because it's free. Well, it's not free, it carries a substantial legal risk. There may well be a big portion of downloaders who don't have the money to buy the show legally. But the rest of them do it because of the benefits of the medium, not its price tag.
Offer us exactly the benefits and the convenience of the bootlegged medium, just give us an option to pay you for it. It really is that simple. Nobody is advocating you should cease any of your current offerings. Just create an additional sales channel and allow the money to flow in.
So this is what the a la carte advocates want? Two channels (HBO & ESPN) for $35? Bundling seems so obviously the better way to approach this (180 channels for $65).
A la carte shows not channels. The TV people want it to be a discussion about channels, but the concept of channels doesn't make sense when one looks at the idea from a distance. Sports watching seems to be its own world due to the live nature of the content.
Shows? That's even sillier. You'd be paying 10x for a fraction of the content. TV would never work if stations had such a hard time getting folks to sample.
Just pretend you're only paying for your shows and everything else is free. You would not be paying less money a la carte.
But the 160-170 "trash" channels need to be included to have any chance of ever being seen. To the point they are willing to be included for free and in fact some will even pay to be included.
The economics of a la carte just don't make any sense at all.
I'm commenting solely on the factual incorrectness of saying the above was not a deal, when it very clearly was, assuming "deal" means a more economical choice. That's all.
> I'm commenting solely on the factual incorrectness of saying the above was not a deal, when it very clearly was, assuming "deal" means a more economical choice.
And again, this assumes that all channels are equally valuable to you. Spending more money on things you do not want is not more economical.
They do have the same value, and that value is "do I want to pay for this channel?"
The person I replied to said there were 10-20 channels worth paying for, and then complained about the cost of those channels, despite the fact that they were undeniably cheaper than anything the person could get individually.
I hope you realize I have no dog in this fight, and am merely commenting based on internal argument consistency. The argument the above poster made was incorrect, internally. That's all I'm pointing out.
We've now spent the better part of 3 hours talking about this. Consider for a moment the possibility that this isn't a very important distinction, and that your continual insistence on the issue is perhaps detrimental to the greater conversation and HN in general.
> They do have the same value, and that value is "do I want to pay for this channel?"
By that logic, all items in the world have the same value and that value is "do I want to pay for this item"?
They each have a different value based on "what do I want to pay for this channel". It is not a binary option of "I WILL PAY NO MATTER THE COST" and "I WILL NEVER PAY NO MATTER HOW CHEAP".
> The argument the above poster made was incorrect, internally. That's all I'm pointing out.
And all I'm pointing out is that your argument is incorrect.
> We've now spent the better part of 3 hours talking about this.
Which is odd, since all I've been saying is that the choice:
More expensive & more channels vs less expensive & fewer channels
has no clear winner without agreeing on what each particular channel is "worth". This is a classic case of multi-objective optimisation. I'm quite interested in finding out why this is such a disagreeable concept to you.
> Consider for a moment the possibility that this isn't a very important distinction, and that your continual insistence on the issue is perhaps detrimental to the greater conversation and HN in general.
And yet your continual insistence is beneficial? I'm a little confused, it's worth your time to try and point out a problem in someone's thinking, but not worth anyone else's time to point out problems in yours?
I'm unsure as to why pointing out problems in your argument is against the spirit of HN. Perhaps you want a hackernews where we all misquote each other and logical flaws are left unchallenged. I'd hoped we'd all try and at least have sound arguments, which is what prompted you to post your original sarcastic comment.
I'd hoped that through discussion we could straighten it out, but that seems futile now as I've repeated myself enough times in different ways. Instead I'll just ask that you look at the honestly look at the claims you've made and see if you find any problems with them.
And finally, in case it isn't clear, I think that both you and urda are wrong.
10-20 channels worth buying at a price of $3.25-$6.50/channel is a better economical choice than 1-2 channels worth buying unbundled at a price of $17.50/channel.
Everything else here is you making HN a worse place to be. That's it.
> 10-20 channels worth buying at a price of $3.25-$6.50/channel is a better economical choice than 1-2 channels worth buying unbundled at a price of $17.50/channel.
It's simply not the case that spending more money to get more channels is always more economical just because the cost per channel goes down. Which is more economical depends on the value you associate with each channel.
If one channel cost $20, or I could get that channel and 9 others for $40, which is better for me? It depends on whether or not those 9 channels are worth $20 to me. If they're not, then it's not a better deal. Just because I might be willing to pay some money for those 9, doesn't mean I'm willing to pay $20 for them. If those channels are worth more than $20 to me, then it may well be a good deal for me.
Therefore, packages are good deals for some, unbundled channels are good deals for others.
The person I replied to set the value of the 10-20 channels at "worth paying for" at the price set, so the value beyond that is irrelevant for this discussion.
"Worth buying" is a boolean. It's either "worth" or it's not, because we've already establish that "worth" channels are willing to be paid for at $17.50, so less than $17.50 is still within any pricing range that might exist.
Would it be easier for you to grasp if we called them "quality" channels? 10-20 quality channels? Paying for 10-20 quality channels that are bundled together is more economical than paying for each quality channel on its own, based on the values given by the commenter.
Your "scale" idea is just a pointless intermediary step towards deciding if a channel is "worth" or not. While yes, you could decide what cost you're willing to pay for each channel, you will still arrive at a "yes/no" decision for each channel (a decision that will only get more generous the less expensive the cost of the individual channel), which will be the "worth" value I've been talking about.
> "Worth buying" is a boolean. It's either "worth" or it's not, because we've already establish that "worth" channels are willing to be paid for at $17.50, so less than $17.50 is still within any pricing range that might exist.
What part of their comment did you interpret as them thinking each of those 20 channels is worth $17.50 on their own?
We have only established that two specific channels were worth that much. Not any of the others. This is an absolutely vital distinction.
> . While yes, you could decide what cost you're willing to pay for each channel, you will still arrive at a "yes/no" decision for each channel (a decision that will only get more generous the less expensive the cost of the individual channel)
Right, so if I'm willing to pay $17.50 for HBO, I'm obviously willing to pay $5 for HBO. But being willing to pay $17.50 for HBO doesn't mean I'm willing to pay $5 for a different channel.
> based on the values given by the commenter.
urdu did not specify how valuable those channels were to them. They just said that it was 20 (let's call them "quality channels") for $65 and that wasn't much of a deal.
> Would it be easier for you to grasp if we called them "quality" channels? 10-20 quality channels? Paying for 10-20 quality channels that are bundled together is more economical than paying for each quality channel on its own, based on the values given by the commenter.
And the decision is not "buy them all on their own or buy them all together" it's "buy some on their own and not others or buy them all together". Nobody here is arguing that buying the same items at a higher price each is better value, they're arguing that buying a subset of them at a higher price each can be better value overall.
This should be obvious if we split out the two channels like so:
Package A: Two channels at $17.50 each
Package B: Eighteen channels at $1.67 each
If I don't value the channels in B enough, it is more economical to me to only buy package A rather than package A and package B.
> Bundling seems so obviously the better way to approach this (180 channels for $65).
180 basic channels, not including HBO. HBO is $15/month on top of your basic cable package, at least from my cable provider. Oh Showtime, too? That's another $15. Oh, Cinemax? Yup, another $15.
Plus, at least in Redwood City, CA, Comcast wouldn't give us HBO on our $63/basic cable, they wanted us to purchase a Digital Cable Box (~ $90), and then pay $85/month for Digital Cable.
And then, and only then, would they give us the 6 month $15/month HBO promo.
Between Amazon Prime (Which I have already for free shipping), Netflix ($8/month), and HBO ($15/month) - I have pretty much all the entertainment I'm really interested in for $23/month.
Every so often something good will pop up that Netflix doesn't have - at which point I'll go to ITunes for $20-25 to pick up a season.
On an annual basis, way, way, way less than I would have paid for cable.
My only concern is that I don't know if I'll be able to watch HBO on the road, or whether I'll need an Apple TV.
Mad Men, Breaking Bad, Better Call Saul, The Americans, Justified, Walking Dead, Daily Show, Broadchurch, Downton Abbey (not sure which of these you're able to view)?
I'll cut you some slack on not getting any of the major networks since the cheap digital antennas can work very well.
In San Francisco we get 180 channels + HBO + DVR + 50mbps internet for $100 month. That includes being able to watch TV/DVR/OnDemand on pretty much any device, from anywhere.
I've actually purchased Some of those from iTunes (Mad Men), if I want to talk about them with others. Otherwise I usually can wait a few years for them to come out on Netflix (Breaking Bad, Walking Dead, Downton Abbey).
Perhaps I just got so used to not having a TV (last time around 2003), that I've adjusted my behavior and expectations such that I don't miss it. If I was a sports junky, this would probably be different - that seems to be the last bastion of Cable TV - once that goes, it will be a good thing that the major cable companies are also the major internet suppliers.
No, I just want HBO and don't want to pay for the expensive base cable packages required to get it at all... Happy to pay for Netflix and Hulu Plus too since it adds value to me where as incrementally more cable channels do not.
Bundling is better for some consumers, unbundled is better for some consumers, depending on their preferences. An incomplete analysis can be found here: https://livingeconomics.org/article.asp?docId=288 , incomplete because it doesn't reflect that when moving from a pure bundling to mixed-bundling regime, the bundle prices should theoretically increase, and also because it's an analysis of markets where marginal costs are positive.
Furthermore, for TV in particular, there's the effect that an unbundled channel will get lower viewership than a bundled channel, and thus will receive lower advertising revenues, so the unbundled price will be driven up considerably higher.
In short, people who are crazy about one or two channels/content sources will love unbundling, people who watch a lot of channels will hate the (inexorable) advent of unbundling.
Previously, it wasn't just that TV channels were bundled. Rather, the prices for each individual channel weren't known. How could you even decide if the bundle is a good deal without knowing the price of its components?
So, even for the subset of people who would prefer bundling, this is a great thing! Now we can actually tell if a bundle is being competitive.
This is huge for HBO. Although it will be a difficult battle, it seems that they are fully committed to breaking ties with traditional TV cable providers.
I have a feeling we'll find out that the cable companies need HBO more than HBO needs the cable companies.
The cord-cutting trend has barely just begun. Television five years from now will be a completely different landscape than it is today, and the change from now to then will make what has happened over the past five years look like barely a movement.
I was poking around when this was first announced, and if I remember correctly it seems like HBO only gets $4-$6 per cable subscriber. So even with the administrative overhead, the per-subscriber profits will almost certainly be significantly higher.
I want a DRM-less HD video file that I can play on any computer, when I want. I want to be able to download it from anywhere I might be in the world, and my nationality should not have an effect on the availability of the content.
Heck, if HBO had a web-based tip jar, I would just pay something for every Game of Thrones episode and otherwise go straight ahead and torrent it. You know, HBO, don't "offer" me anything, just give me an option to pay you which makes my download quasi-legal, and I'll take care of the rest myself.