Pay TV is changing rapidly

Discussion in 'DIRECTV General Discussion' started by Bedford11, Nov 22, 2016.

  1. Dec 2, 2016 #41 of 178
    Bedford11

    Bedford11 Member

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    AT&T’s new fixed and mobile internet portal was expected to launch this quarter but has been delayed until some time in early 2017, according to AT&T’s multiscreen authentication partner Synacor. The ad-supported multiplatform portal will provide content with a user driven functionality. Synacor CEO Himesh Bhise defended the delay by saying, “given the size and expanded scope of this project and after our recent joint planning we’ve pushed back the official launch date.”
    Link
    OTT Video News, Deals, Launches and Products - Rethink


    CDN costs are around half a penny.
    “It’s not immaterial, but it is not a cost that we worry about because the costs have continued to come down so significantly
    Link
    Analyst: ‘If Sling wasn’t owned by Dish, it’d be out of business’ | FierceCable
     
    Last edited: Dec 2, 2016
  2. Dec 2, 2016 #42 of 178
    chances14

    chances14 Member

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    delayed? say it ain't so :rolleyes:

    so we've gone from end of 2015 to now early 2017
     
  3. Dec 2, 2016 #43 of 178
    chances14

    chances14 Member

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    it may be cheaper to deliver content over IP. but do you folks honestly believe that these companies will pass these savings on to us in the long run? another factor is that most of the companies that currently deliver the content via tradiional means are also your ISP. you really think they will let streaming services affect their profits once the current pay tv model finally dies? Better get ready for jacked up internet prices and punitive data caps
     
  4. Dec 2, 2016 #44 of 178
    James Long

    James Long Ready for Uplink! Staff Member Super Moderator DBSTalk Gold Club DBSTalk Club

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    I don't accept that premise. Despite the cost of uplinks, backhauls and customer equipment, traditional broadcast delivery (satellite and cable are broadcast) is fairly cheap.

    Perhaps the "Millennials" will be more DIY tech savvy ... Home satellite has moved from large dishes that were self installed or installed by a local dealer to "pizza size dishes" self installed or installed by what is now two companies (others have come and gone). The current state of satellite has gone to primarily professional install (DISH and DIRECTV want the systems to work and installs are not as easy as single satellite dishes).

    Streaming TV requires the user to do their own installation (similar to the early days of big dish satellite or OTA reception). Customers need to provide their own equipment, networks and internet connectivity. Add that to the cost of service.

    For the device crowd that has figured out how to stream to their 80" 4K TV (probably through an app on the TV or a third party device) adding additional streaming services is just a matter of finding services that are available and then paying for them. There are free services ... and they are probably worth every penny that people pay for them. The better content will not be free.
     
  5. Dec 2, 2016 #45 of 178
    Stewart Vernon

    Stewart Vernon Roving Reporter Staff Member Super Moderator DBSTalk Club

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    Don't forget the construction and launching of satellites. That cost goes away too, and the infrastructure to support multiple high-speed streams is still WAY cheaper than that I have to think.
     
  6. Dec 2, 2016 #46 of 178
    slice1900

    slice1900 Well-Known Member

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    But they aren't that expensive, given that they last 15-20 years and the cost is amortized over 20 million (and growing) customers. I'm not sure if we can get reliable information about what it costs Directv to build and launch satellites, but IridiumNEXT will launch 72 satellites for the Iridium network with the build and launch costs estimated at $2.9 billion. One dollar per month per customer over the 15 year design lifetime (they actually last longer) of Directv's satellites adds up to nearly $4 billion - so the actual cost is probably well under a quarter a month!

    Yeah, obviously there are some costs to maintain them but there are costs to maintain the servers running a streaming network etc. that aren't captured in the bandwidth costs so for simplicity we'll assume those costs cancel each other out. At 1/2 cent per hour and 25 cents per month for the satellites, Directv's satellites would cost only 50 hours worth of streaming a month. Still think they cost more?
     
  7. Dec 2, 2016 #47 of 178
    trh

    trh This Space for Sale

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    You're comparing 66 LEO satellites that only transmit data and voice to Geo satellites transmitting video. Can you accurately use Iridium's numbers to calculate how much the sats cost DIRECTV?
     
  8. Dec 2, 2016 #48 of 178
    Bedford11

    Bedford11 Member

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    "DirecTV has the equivalent of four satellites under construction that will cost a total of $1.729 billion including launch and insurance, plus $74 million paid already in 2011, the company said in its SEC filing."

    With an approx. cost of 800 bucks just to set up a sat customer verses just the click of a button to signup for immediate online TV service thru DirectTV Now.

    My, how times have changed. Notice the article is from 2011.
    "DirecTV Chief Executive Michael D. White said during the call that the company is open to partnering with anyone — including rival Dish Network and its EchoStar hardware supplier — to provide a wireless broadband service in the United States. But he said the wireless broadband market situation remains difficult to read."
    Link
    Astrium Picked To Build DirecTV 15 Telecom Satellite - SpaceNews.com
     
  9. Dec 2, 2016 #49 of 178
    James Long

    James Long Ready for Uplink! Staff Member Super Moderator DBSTalk Gold Club DBSTalk Club

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    So $3.3 billion in satellites (assuming their lease covers all of the lessor's cost) with a 15 year life span ... $220 million per year. Spread across 20 million subscribers is $11 per subscriber or about $1 per month. At .5 cents per hour $1 would cover 200 hours of viewing. Less than seven hours per day.

    Even at .5 cents per hour I do not believe one can beat the efficiency of satellite transmission.

    The down side is that there is no savings when customers are not watching ... all the satellites need to be up and working 24/365 regardless of how many viewers there are. But the up side is that each feed can reach from zero to all subscribers without adding bandwidth per subscriber. And the customer does not have to buy their own bandwidth in addition to what they are paying their TV provider.
     
  10. Dec 2, 2016 #50 of 178
    Bedford11

    Bedford11 Member

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    Due to the massive amount of competition coming into the streaming market, including the new Fixed Wireless providing fast connectivity that rural customers have never had access to,providers are being forced to go to the basement bottom pricing just to stay relevant.
    Competition is good for the consumer.

    "MoffettNathanson puts those at $3 per subscriber per month for the internet service and $18 per subscriber per month for satellite."
    Link
    AT&T May Not Rejoice at $35-a-Month Plan, Though Tightwads Can
     
    Last edited: Dec 2, 2016
  11. Dec 2, 2016 #51 of 178
    James Long

    James Long Ready for Uplink! Staff Member Super Moderator DBSTalk Gold Club DBSTalk Club

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    Linked to a paywalled site ... what costs are you referring to here? Content or delivery?
     
  12. Dec 2, 2016 #52 of 178
    chances14

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    You are forgetting that the pay tv provider you are leaving is in most cases the very same provider that you will use to access the competition via the internet. you don't think they will increase your internet rates if you decide to leave for their competition? Once the current pay tv model officially dies, internet rates will start to increase on the same level that pay tv does every year. Before you know it, we will be back to paying the same exorbitant prices for tv as we do now.
     
  13. Dec 2, 2016 #53 of 178
    Bedford11

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    Google the below headline, should be able to read article.

    AT&T May Not Rejoice at $35-a-Month Plan, Though Tightwads Can
     
  14. Dec 2, 2016 #54 of 178
    James Long

    James Long Ready for Uplink! Staff Member Super Moderator DBSTalk Gold Club DBSTalk Club

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    A better quote would have been:
    Then we would have known what you were talking about.

    So according to his calculation satellite costs $15 more per month to deliver but DIRECTV is charging $42 more for the service (and making near zero or negative on streaming). Satellite subsidizing the start up streaming service cannot last forever ... AT&T|DIRECTV need to make it profitable on its own.

    For reference, the last time I did the math DIRECTV was making $20 per subscriber per month in profit. Cut rate pricing will work for the introduction ... but the stockholders won't let AT&T|DIRECTV lose money on DIRECTV Now forever. Expect the prices to increase.
     
  15. Dec 2, 2016 #55 of 178
    Bedford11

    Bedford11 Member

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    Go back thru this thread and read the links on AT&T and all the other coming services wanting to be your "GO TO" Portal.
    How do you think Google has become the 800 pound gorilla? (with Billions and Billions in Profit) in the Portal market.
    Advertising, that's how.
    AT&T can subsidize their TV service thru advertising dollars they make when someone goes thru their portal and clicks on links.
    This is the Holy Grail for these coming services and the future of your low cost TV.
    And to think Google itself is readying a low cost streaming TV package.

    Go back on this thread and read about the research that shows the average viewer only watches 19 channels or less, The days of the bloated/expensive TV packages are over for the average viewer. There will be a multitude of low cost varied skinny bundles coming from the onslaught of providers entering the market.
    Competition is Good, This is a revolution and prices will stay low.
     
    Last edited: Dec 2, 2016
  16. Dec 2, 2016 #56 of 178
    James Long

    James Long Ready for Uplink! Staff Member Super Moderator DBSTalk Gold Club DBSTalk Club

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    Content owners are king. There is NO streaming provider offering or expected to offer the customers choice of any 19 channels out of the hundreds of channels available via satellite. One might get lucky if one does not watch ANY of the major channels ... but the content providers with the best content know how to market their content - in packages where people are forced to pay for more than they watch. Packages such as DISH's SlingTV and DIRECTV Now.

    Out of context quoting and irrelevant links will not change the marketplace.
     
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  17. Dec 2, 2016 #57 of 178
    Bedford11

    Bedford11 Member

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    "No, Content Isn't King"
    "The distributors like Comcast, AT&T and whatever replaces them have won. Distribution -- not content -- is the new king."
    Link

    No, Content Isn't King


    "Content is king" is no longer the major factor with the upcoming mass competition in the market. When you just had four or so providers it was true.
    Now whoever owns the last mile pipe (upcoming fixed wireless for millions) and the Portal owners will share the kingdom if not be the outright Kings.

    There will be sooo many cheap and varied skinny packages out there that many will hit the sweet spot for the average consumer.

    "Time Warner Sale To AT&T Shows Distribution, Not Content, Is King"

    The old adage is, “Content is king.” But owning all three is the king’s empire.

    Link
    Time Warner Sale To AT&T Shows Distribution, Not Content, Is King

    Link
    If 'content is king,' owning content, distribution, and data is the king’s empire
     
    Last edited: Dec 2, 2016
  18. Dec 2, 2016 #58 of 178
    Stewart Vernon

    Stewart Vernon Roving Reporter Staff Member Super Moderator DBSTalk Club

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    Keep in mind when you're talking about the affordability of building/launching satellites and amortizing that over 20 years and 20 million DirecTV subscribers... that the math you're using would only work for DirecTV.

    For another company to start from scratch and offer their own satellite service, it is a daunting thing indeed to come up with billions in cash up front to build/launch those satellites and hope to get that money back over those 20 years OR get someone to lend you that kind of credit given the marketplace today.

    VS.

    Starting up a new streaming service that doesn't have all of those costs up front and doesn't require 20 million subscribers instantaneously (which won't happen) to help amortize that cost down to a manageable level.

    So... there's the cost of the satellites... and how a company like DirecTV can afford it vs how almost anyone else (besides Dish) can't.
     
  19. Dec 2, 2016 #59 of 178
    Bedford11

    Bedford11 Member

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    As mentioned in earlier post in this thread that the music industry went to the internet, the video industry will follow the same.
    Look at all the NEW content creators out there that have already captured the young viewers eyeballs. The current major content creators know this and are forced to play ball.

    "Streaming services may have started out as technological trends, but we can’t ignore that the actual release of music has become synonymous with the music industry as a whole. Labels may still have the monopoly on the recording industry, but it is the distribution that holds sway"

    "In a very real sense, streaming services could well be moving towards the usurping of the record label’s traditional place in the industry. Competing across so many areas, their position as the point of contact with the consumer is incredibly powerful"
    Link
    Are Streaming Services The New Record Labels? • Howl & Echoes
     
  20. Dec 2, 2016 #60 of 178
    chances14

    chances14 Member

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    sorry bedford but you are living in a fantasy world that is never going to become reality.

    ultimately, streaming services and the internet needed to access them will become just as expensive as current pay tv packages are now in one way or another. stockholders will make sure of that

    comparing streaming services to what happen with music industry is moot. labels do not own the medium that people used to download music. whereas the major tv distributors also own the medium used to access streaming services
     

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