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Guest Message by DevFuse

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Starz Idea


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5 replies to this topic

#1 OFFLINE   Scott Greczkowski

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Posted 01 May 2002 - 09:59 AM

Here is an interesting idea from Starz!

Normally I wouldnt post press releases but this one might make you think.

I know out of the 200 channels I get I only watch 10 or 12 of them regularly.

Here you go

STARZ ENCORE'S HALE TO SKYFORUM:
STOP THE MADNESS, FLIP PROGRAMMING STRATEGY

TIER THE DOGS -- OFFER LOW-COST PREMIUM MOVIE CHANNEL PACKAGE WITH
LOCALS AND PROVEN BASIC PERFORMERS TO DRIVE GROWTH, CUSTOMER
SATISFACTION AND PROFITS


New York, May 1, 2002 -- Building on a message unveiled last week, a senior Starz Encore Group executive told satellite TV industry leaders gathered in New York yesterday to flip the way their industry packages programming by including premium movie channels in entry-level packages and discarding superfluous basic networks of little or no interest to most consumers.

"Tier the dogs, said Mike Hale, Starz Encore's executive vice
president and chief marketing officer, a reference to the numerous
digital basic networks of questionable value that have sprung forth to fill digital satellite and digital cable capacity, "and give consumers what they really want from digital TV, movies and sports.

Hale told SkyFORUM attendees at the Waldorf Astoria hotel they should relegate narrow interest and poorly rated digital basic networks to distant tiers for purchase in bundles, replacing them with a value-priced package of premium movie, sports and local channels, along with a core group of well-known basic cable channels. "The key questions here are, is anyone watching these basic channels and what are they doing for customer satisfaction?"

Hale said consumers are ticked off about high costs and the long climb up the ladder of different programming packages to attain much-desired premium movie channels and sports. He said the direct broadcast satellite (DBS) industry could endear itself to customers forever with a basic 100-channel package that comprised his proposal.

"As Aesop's Fables taught us in 'The Fox and the Grapes,'it's easy to despise what you cannot get," said Hale. "Premium movie channels and sports are the things people really want from digital TV, but they're discouraged by a thicket of basic channel packages that ramp up the price. Let's lower the grapes for consumers so they can quench their thirst."

With almost daily headlines about high cable bills and programming costs in the trade and consumer press, Hale suggested DBS operators "stop the madness" of force-feeding niche channels whose ratings and satisfaction levels lag behind their high license fees. "With a single stroke, DBS could cut programming costs, improve customer satisfaction, drive growth and boost profits, added Hale, a cable marketing veteran with Starz Encore since its founding 11 years ago.

Citing the Starz Super Pak of up to 12 premium movie channels for
about 12 dollars a month as a perfect fit for this new strategy, Hale said DBS operators could build a "digital share driver" by combining this new basic programming strategy with subscription video-on-demand technology (SVOD).

He said DBS could easily be the first to market with a valuable
package of attractive channels and the DVD-like, on-demand control of SVOD, creating and enticing reason for consumers to drive their digital dollars toward DBS and away from cable.

"No doubt about it, it's a slugfest out there and this radical
strategy would surely help DBS enlarge its share of digital TV
customers, added Hale

Starz Encore President of Distribution Que Spaulding issued a similar call for a programming lineup revamp at last week's Carmel Group Satellite Entertainment 2002 conference in California.

Starz Encore Group LLC (Starz Encore) is the largest provider of cable and satellite-delivered premium movie channels in the United States, owning 15 domestic channels with approximately 114 million pay units. Starz Encore offers the Starz Super PakSM, with up to 12 digital movie channels, and Starz On DemandSM, the first premium subscription video-on-demand (SVOD) service. Starz Encore is a wholly owned subsidiary of Liberty Media Corporation (NYSE: L, LMCb), www.starzencore.com.

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#2 OFFLINE   pmichael

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Posted 01 May 2002 - 01:34 PM

I doubt I'd ever subscribe to a service that provides just premium movies. For a real movie buff, that might prove enticing. But I actually watch different channels depending on my mood, so I like the variety of channels in the basic programming packages. And if there's a "can't miss" movie, there's always PPV or DVD(or doing something old fashioned and see the movie in the theater).

#3 OFFLINE   DarrellP

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Posted 02 May 2002 - 12:59 PM

The Everything pack on Dish got too expensive for me. After adding a second receiver, locals and the extended warranty, I was up to about $87/month. For 2 hrs of TV a day, that is extreme.

I cut my programming down to the AT150, HBO and locals and now my bill is $67/month. Still more than I want to pay, I would be happy at around $50 max. I am a movie buff and in order to get the maximum movies for my dollar, I had to go with the AT150 since it includes about a dozen movie channels.

I would love to see a bottom tier that had the same movie channels as the AT150 plus the Discovery channels and Sci Fi. With this package I would be happier than a pig in S***.

I also receive local OTA digital channels via my Dish 6000, so my actual satellite viewing is fairly limited.
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#4 OFFLINE   lee635

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Posted 02 May 2002 - 02:32 PM

Well E* lead this concept by including premium channels in the AT150.

I agree with this idea. We subscribe to E's basic package the AT50 and Showtime/TMC/Sundance/Flix. For the life of me, I cannot understand why the providers don't make their basic package contain the top rated cable channels. And every year re-evaluate the ratings and move low rated channels to higher tiers and pull high performers from higher tiers down to the basic tier. You could even market the package as "the channels people actually watch most". Of course, there are probably contract considerations.

As for the premiums, it's another strange case. Premiums are a great service and yet, you often have to subscribe to a high level tier with cable before you can get a movie channel (or the multipack of that movie channel). And there's no discount on the premiums unless you have a high cost package.

Sports is the same way. Why do you have to sub to the AT100 before you get a regional sports network. Even if the regional sports is expensive, you'll attract more subs by dropping 3 or 4 of the unwatched channels and bringing the regional sports down to AT50.

I couldn't agree more with this idea. LEAD WITH YOUR BEST, MOST POPULAR CHANNELS IN YOUR ENTRY LEVEL TIER -- NOT YOUR HIGHEST LEVEL TIER.
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#5 OFFLINE   Mark Holtz

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Posted 02 May 2002 - 04:12 PM

Good in theory, not good in practice because the program providers won't allow it. They go to the advertisers and say that a particular channel reaches a potential level of eyeballs.
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#6 OFFLINE   Jacob S

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Posted 02 May 2002 - 07:38 PM

Yes but DISH had a right to NOT carry the channels. DISH could choose to drop 3-6 channels that very few people watches per movie channel that they would introduce into the package to keep the prices the same on the basic packages.

The problem is that DISH is forced to carry these channels since one company owns many channels and they have to take the less preferred channels to get the better channels and forced to put them in the basic package. this should be illegal and i dont see how c-band can just sell individual channels where as DISH and DIRECTV cant. there should be a law made preventing this from happening. i suppose DISH and DIRECTV get a discount for taking a group of channels by a company that they have to offer and it is somewhat cheaper to bundle all the channels in a package.

If everyone took the Starz package then I am sure the price would be half or a third of what it would be now therefore making it very reasonable in price and that with a combination of dropping some channels that are not in a contractual agreement to be in a basic package to allow other more popular channels to be purchased could be dropped could allow the package price to remain the same or to only be increased slightly to maybe $25 a month which would have movie channels in it as well and they could do the say with the package above that.

DISH plans on getting tougher with the program providers and a discount on the programming when they merge therefore allowing a more competitive edge against cable since they could actually drop the programming prices and add more channels at the same time, so they could be more flexible if they get to merge.




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