Hard News by Russell Brown

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Hard News: The future: be careful what you wish for

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  • Dylan Reeve,

    You’ll have to ask yourself whether you want to pay $150 per Premier League season in addition to your Sky subscription. There is a downside to the disaggregation of content monopolies, at least in the short term.

    There’s the rub of direct-to-consumer IP television. As expensive as Sky is, it’s a lot cheaper than buying all that content directly (assuming you could). Networks like Sky (and in the IPTV space, Hulu and Netflix) offer an economy of scale.

    While it may seem appealing to simply be able to purchase access to the content you’re interested in, whether on a per-channel or per-program basis, it quickly adds up.

    It’s for this reason that I still don’t think that the TV network model we’re used to will die – it will simply diversify and the platform will change. Hopefully.

    But it’s a bit of a chicken and egg game at the moment – without a large potential audience the cost of licensing and curating content is very high. And without a lot of content it’s difficult to capture an audience (how is Quickflix going?). It needs a player with deep pockets to break the market open and play the long game on getting kiwis into online content in a meaningful way.

    Auckland • Since Aug 2008 • 311 posts Report Reply

  • Rob Coup, in reply to Dylan Reeve,

    A recent series of articles by Ben Thompson discuss ESPN & AMC as examples of affiliate/ad revenue. Basically:

    The truth is that the current TV system is a great deal for everyone.

    * Networks earn much more per viewer than would be sustainable under a la carte pricing
    * Networks are incentivised to create (or in ESPN’s case, buy rights to) great programming; making your content “must-watch” lets you raise your affiliate fees
    * Viewers get access to multiple channels that are hyper-focused on specific niches. Sure, folks complain about paying for those niches, but only because they don’t realize others are subsidizing their particular interests
    * Cable companies know the cable TV business, and would prefer to put up with customer disgruntlement over rising prices than become dumb pipes

    Cable TV is socialism that works; subscribers pay equally for everything, and watch only what they want, to the benefit of everyone. Any “grand vision” Apple, or any other tech company, has for television is likely to sustain the current model, not disrupt it directly.

    Auckland • Since Nov 2009 • 18 posts Report Reply

  • Tim Michie,

    As much as I'm taking this through with my football friends, I'm also thinking that the arguements many have been making on the propagation of broadband choked by SkyTV restricting access (Game of Thrones season anyone?) does mean this is a positive development. If the TV3 negotiations plan out as speculated this may turn out to have been a very good week for NZ TV media.

    Auckward • Since Nov 2006 • 614 posts Report Reply

  • Phil Lyth,

    I must be a Luddite. In our household the question is framed:

    Sky? Why?

    Wellington • Since Apr 2009 • 458 posts Report Reply

  • Geoff Lealand,

    There were worst decisions made by TVNZ, such as the selling-off of the Natural History Unit for diddly-squat. I can recall Michael Stedman telling me a couple of years back that NHNZ was making a bigger annual profit than TVNZ.

    Hundreds of hours of soccer? Hundreds of hours of kicking a ball around for 90 minutes, to end up with a scoreless draw??? I would rather chew my fingers off.

    Screen & Media Studies, U… • Since Oct 2007 • 2560 posts Report Reply

  • Tim Michie, in reply to Phil Lyth,

    I do agree, the origianl sky is much preferable although I do indulge in the occasional pathetic when overcast and ask someone to change the channel.

    Auckward • Since Nov 2006 • 614 posts Report Reply

  • Konrad Kurta,

    A friend of mine was saying buying rights for Serie A is being considered by the group. Other leagues might be available as a "standalone subscription or a cheap upgrade to the premier league pass" if enough people are interested. Dunno if Sky has that tied up or not, or how much the other league rights would cost.

    South Korea • Since Dec 2012 • 43 posts Report Reply

  • Russell Brown, in reply to Konrad Kurta,

    A friend of mine was saying buying rights for Serie A is being considered by the group. Other leagues might be available as a “standalone subscription or a cheap upgrade to the premier league pass” if enough people are interested.

    That's a pretty good guess, I think. They'll test demand and then add the other leagues for free or cheap.

    Auckland • Since Nov 2006 • 22848 posts Report Reply

  • Sacha, in reply to Geoff Lealand,

    I would rather chew my fingers off

    we should have a non-beautiful-game party some time

    Ak • Since May 2008 • 19740 posts Report Reply

  • Sacha, in reply to Tim Michie,

    this may turn out to have been a very good week for NZ TV media

    Yes

    Ak • Since May 2008 • 19740 posts Report Reply

  • Russell Brown, in reply to Geoff Lealand,

    There were worst decisions made by TVNZ, such as the selling-off of the Natural History Unit for diddly-squat. I can recall Michael Stedman telling me a couple of years back that NHNZ was making a bigger annual profit than TVNZ.

    I think losing that strategic shareholding in Sky was more critical. And as Michael has pointed out, NHNZ wouldn’t have done nearly as well under TVNZ management.

    Auckland • Since Nov 2006 • 22848 posts Report Reply

  • Russell Brown, in reply to Rob Coup,

    A recent series of articles by Ben Thompson discuss ESPN & AMC as examples of affiliate/ad revenue. Basically:

    One key issue is that both of those produce the content they sell. Coliseum is just distributing imported content -- it's more like Netflix than a cable channel. Sky produces the local sports coverage it sells us, through a subsidiary (another gig that TVNZ used to have). It's a big step to offering local sport for Coliseum if it means producing coverage.

    Auckland • Since Nov 2006 • 22848 posts Report Reply

  • Rich of Observationz,

    Strikes me that soccer is something that a small number of people care a lot about and would be prepared to pay $150 a month to watch Chelsea or whoever at 5am in the morning. The rest of the population would, if they want to watch at all, be quite happy spending a couple of hours watching a free-to-air delayed game packed out with ads.

    Back in Wellington • Since Nov 2006 • 5550 posts Report Reply

  • Sacha, in reply to Russell Brown,

    And as Michael has pointed out, NHNZ wouldn’t have done nearly as well under TVNZ management

    Recall him saying similar, yes. Good man.

    Ak • Since May 2008 • 19740 posts Report Reply

  • Sacha, in reply to Rich of Observationz,

    $150 a month

    per year

    Ak • Since May 2008 • 19740 posts Report Reply

  • Peter Darlington, in reply to Phil Lyth,

    I must be a Luddite. In our household the question is framed:

    Sky? Why?

    While Sky is mainly the preserve of us sports tragics, if you want to watch decent TV programming nowadays you have to have it, or wait until Prime catches up, or mess about with proxy rearranging. Like their sports coverage, Sky was just easy if you were prepared to pay the price.

    Nelson • Since Nov 2006 • 949 posts Report Reply

  • Peter Darlington, in reply to Russell Brown,

    One key issue is that both of those produce the content they sell. Coliseum is just distributing imported content -- it's more like Netflix than a cable channel.

    Delivery will be interesting. If they can get an AppleTV app and prove to have reliable and timely HD delivery they may be on to something. I never went for the illegal streams though, they were too painful to be bothered. I just won't bother rather than subject myself to that.

    Nelson • Since Nov 2006 • 949 posts Report Reply

  • Tom Semmens,

    No rugby = end of Sky, simple as that. Sky suck. They are a monopoly who know it and have always treated their customers like shit, playing incessant promos and advertisments (I’ve have PAID already, you douches) and continually putting up new paywalls to new and interesting stuff, using their stranglehold on sport to sneer at anyone who moans about their rack-renting.

    But anyway, nowadays no one I know has Sky for anything other than sport. You can download whatever movies or shows or entire series you want from any number of sites for free, when you want. It is only by controlling the league, union and soccer that Sky have you by the balls and boy, does that squeezing hurt. So if they lose the rugby, they will lose two thirds of their audience in a week, and most of the rest the following week. And I say good riddance to bad rubbish if that comes to pass.

    The future for premium content is probably going to be more audience atomisation via the internet, but that will IMHO paradoxically possibly be good for free to air TV – it will potentially once again become the one place we can all have a shared experience for live and local content like news and current affairs.

    Sevilla, Espana • Since Nov 2006 • 2217 posts Report Reply

  • Sacha, in reply to Tom Semmens,

    one place we can all have a shared experience

    Never going to happen again, no matter what the technology or other drivers.

    Ak • Since May 2008 • 19740 posts Report Reply

  • Kumara Republic,

    SKY TV has gotten fat and rested on its laurels. As far as I'm concerned, it's increasingly a relic of the pre-Internet age, and I'm not surprised that SKY was a strong supporter of the Skynet Act. All the more so when Louis CK can pocket USD$1m from a single live on-demand comedy gig.

    The southernmost capital … • Since Nov 2006 • 5441 posts Report Reply

  • Rich of Observationz, in reply to Sacha,

    That's a stupid price. They should have started with at least $100 a month to see who bites. Premier League season tickets (different thing, I know) cost about $5k, so there must a group of people soccer-mad enough to fork out silly dollars.

    Back in Wellington • Since Nov 2006 • 5550 posts Report Reply

  • ceebeew,

    Via the Internet? I've just bought an Apple TV and downloaded a movie. It ate 5Gb of my monthly broadband allowance. I wonder how much broadband a Premier League football game will take? How big a plan will users have to have to watch their favourite team play all their games? I think these guys are dreaming..

    Christchurch • Since Jun 2013 • 1 posts Report Reply

  • John Holley, in reply to ceebeew,

    If you want to do IPTV etc., a unlimited data plan is good. Orcon is $100/month and that includes phone and unlimited NZ phone calls.

    Auckland • Since Nov 2006 • 142 posts Report Reply

  • Ian Dalziel, in reply to ceebeew,

    I think these guys are dreaming..

    So that's what those Google balloons are really for!
    Not just a Helium deathwish or for selling ads to high country farmers, then...
    \;- /

    Christchurch • Since Dec 2006 • 7950 posts Report Reply

  • Tom Semmens,

    This move by Coliseum raises the whole question of the hopelessly outdated and out-manoeuvred Kiwi share. How much content (not to mention government services) need to go solely online before our major political parties wake up to the realisation that a broadband internet connection is now an essentially a human right in an advanced first world country? We wouldn't be couching this discussion in terms "be careful what you wish for" if we approached internet access from a first principle that in 2013 internet access is as basic a requirement to be a fully participating citizen as the universal franchise itself.

    Personally, I'd abandon Kiwi share as a relic of the 1980s and instead do a deal with a telco to provide free of charge to all homes that want one a broadband router connected to a free government portal that allowed access to a restriction portfolio of sites - anything ending with .govt.nz, for example (and make radio NZ radionz.govt.nz while you were at it). The government could then negotiate with private providers as to who else might want in to access to the free state portal - for example, agree to do a deal with Microsoft to automatically give all New Zealanders a free outlook.com email address and a Skype account. And if such a portal existed, then it would be but a small matter for the government to do deals around free-to-portal sporting content via a state run online content provider.

    This does create an ideological issue around net neutrality, but from the perspective of not being able to afford a phone line or an internet connection then high minded musing by typically well connected themselves internet commentators about net neutrality looks absurdly moot. And of course, a controlled portal means no politician could be attacked for providing free online porn to the nation.

    Just for once, I would like to see a political party be bold on this sort of thing - although I am (perhaps foolishly) assuming that the SkyCity corporate box at Eden Park isn't a dual use one with Sky TV.

    Sevilla, Espana • Since Nov 2006 • 2217 posts Report Reply

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