Baseball on Cable

[Mike Sixel]

That's what I thought, Brock.

[SweetOne69]

I'm about 98% certain it will be a universal subscription service. HBO already offers individual episodes on iTunes, Amazon, etc. They're currently about six months behind the show premiere date but that method of offering already exists. There's no reason for HBO to announce a streaming service if that was the case, they could just start offering their shows on iTunes and Amazon earlier than normal.

 

I think it's pretty apparent that HBO is going to directly ape the Netflix/Hulu/Amazon Prime model, which has been extremely successful. $8/mo gets you access to all HBO shows the day after they premiere on cable, available via web browser and apps on iOS, Android, AppleTV, FireTV, Roku, Nexus Player, etc.

 

I read one article that said it was a la carte, but I can't find it any more.  I just read an article in the WSJ that if it is a monthly subscription service it would be about the same price as you would get it through you Cable/Satellite subscriber (i.e. $15/month).

 

The cable providers would demand that they don't undercut them so it makes sense that HBO would have to charge the same price.

[Brock Beauchamp]

I read one article that said it was a la carte, but I can't find it any more.  I just read an article in the WSJ that if it is a monthly subscription service it would be about the same price as you would get it through you Cable/Satellite subscriber (i.e. $15/month).

 

The cable providers would demand that they don't undercut them so it makes sense that HBO would have to charge the same price.

It's not in HBO's best interests to worry about the cable providers too much. They're in the catbird seat here. Cable providers can't walk away from HBO.

 

Also, cable providers are going to have a hell of a time defining "undercutting", seeing as many of them include HBO at discounted prices in higher tier cable packages.

 

The HBO streaming service is probably going to be gimped compared to the cable on-demand package, anyway... Currently, HBO offers streaming of hundreds of movies through on-demand and HBO GO. There is no news that they plan to allow movie streaming in this new service. I'd wager there's a 50/50 chance that the new streaming service will be HBO-only content (GoT, Sopranos, Boardwalk, etc) sans movies. Getting the film industry on board is going to require a slew of new licenses and contracts. HBO may just say "screw it" and offer only their products to stream at a reduced price.

 

If it's HBO-only content, I think it'll be in the $8-10/mo range. If it's including movies, then yeah, it will probably be more toward $15/mo but because HBO won't be splitting the revenue with cable providers, there's a good chance they won't go full-price because the market might not support it. Not in a world where Netflix is $8/mo and offers hundreds of thousands more episodes and movies than HBO could ever offer.

 

HBO can price this service at $10/mo and because they've cut out the cable provider middle-man, still make more money per user than the $15/mo cable providers charge for the service.

[biggentleben]

I can tell you exactly what HBO costs here.  Limited cable with basic ABC/CBS/NBC/Fox/etc programming and nothing else here runs $19.95.  Midcontinent Communications (the cable provider here in town) offers Limited plus HBO for $26.95, so the exact HBO cost is $7/month.  If other cable companies are charging more, then they're not exactly doing it right, seeing as Midcontinent has invested a ton of capital in rural areas yet still can offer an "HBO suite" for $7.

[Brock Beauchamp]

I can tell you exactly what HBO costs here.  Limited cable with basic ABC/CBS/NBC/Fox/etc programming and nothing else here runs $19.95.  Midcontinent Communications (the cable provider here in town) offers Limited plus HBO for $26.95, so the exact HBO cost is $7/month.  If other cable companies are charging more, then they're not exactly doing it right, seeing as Midcontinent has invested a ton of capital in rural areas yet still can offer an "HBO suite" for $7.

Yep. This. The HBO pricing model is all over the place. I'll be hugely disappointed in HBO if they think they can charge twice what Netflix charges. I don't think they're that out of touch... After all, they're progressive enough to know this change is necessary in the first place.

[jay]

Haven't seen any mention of BTN here.  Getting their network picked up by cable networks negatively impacted my ability to watch Gopher sports for a short period of time.  However, I love them now. 

 

I can watch any Gopher game they're televising from any device, anywhere, in real-time.  THAT is what consumers want.  It's included in my cable subscription, which is nice in that I don't have to pay anything additional... but it requires a cable subscription, which as others have alluded to... sucks.

 

I'm not sure why they are able to do that and others don't.... maybe it has something to do with being a new network.

[biggentleben]

Haven't seen any mention of BTN here.  Getting their network picked up by cable networks negatively impacted my ability to watch Gopher sports for a short period of time.  However, I love them now. 

 

I can watch any Gopher game they're televising from any device, anywhere, in real-time.  THAT is what consumers want.  It's included in my cable subscription, which is nice in that I don't have to pay anything additional... but it requires a cable subscription, which as others have alluded to... sucks.

 

I'm not sure why they are able to do that and others don't.... maybe it has something to do with being a new network.

 

Though I will say that the SEC and ACC network have done much, much better by pairing with services like AppleTV and Roku to purchase a subscription just to their network and use your streaming device.  I can't do the same with BTN.

[sf27annie]

I live in SF Bay Area and wanted to add my thoughts to this. I have to go to a bar or restaurant to watch my team in the NL playoffs. In order to get Fox sports 1, i would have to pay $90 a month. (Plus internet, both from Comcast, so it would come out to over $150.) Many of us fans here in the Bay Area aren't able to get either MLB or FS1. One of the cable companies in San Francisco didn't even offer MLB so when games were on MLB, you couldn't even find them at most bars. 

Of course I'd rather have the playoffs and WS on a network that people could get with basic cable. But what really ticks me off is you have to subscribe to entire packages, with hundreds of stations you will never watch, and if your provider is ComCast you have to put in new hardware every time you upgrade service. 

My suggestion is that cable providers offer plans where a viewer can order specific networks. The cable companies could still make enough money that way. They are so greedy right now, however, that they are going to end up pricing themselves into the ground, because techie sports fans will come up with other ways to get games on TV or internet.  

[Steven Buhr]

I think we are going to see changes to MLB.TV and blackout restrictions as soon as next year. I've been meaning to update the article we wrote this spring about the antitrust lawsuit against MLB. Short version is that it's not going well for the MLB. MLB and the teams finally tried to have the case thrown out and the judge decided that the antitrust exemption does not apply to the broadcast rights. A week later, we started seeing rumors of MLB easing blackout restrictions.

I bet they start doing what HBO currently does. HBO allows you to stream shows if you already have HBO - you just need to create an online account. So for us, this means it solves the blackout restrictions, but you still have to buy cable. 

 

Unfortunately, it wouldn't, "solve the blackout restrictions," if, like 95% of Iowans, you live in an area that is designated arbitrarily as part of the Twins' market (and the Royals and the Cardinals and the Cubs and the White Sox and the Brewers) but where Fox Sports North is not even an option from your local cable provider. Since Mediacom DOES make FSN available in some markets, one might hope that I would be able to simply click "Mediacom" and provide my acct number in order to get past the blackout firewall, even if my specific Mediacom account doesn't have FSN as an option... but I'm not expecting that to be the case. One way or another, I completely expect MLB and the Twins to continue screwing over residents of places like Iowa, Nevada and the Carolinas, where multiple teams claim the area as part of their home markets, even though their games are not available via cable, at any price.

 

One might hope the lawyers pressing this case would look out for everyone involved, but my experience with the profession tells me not to get my hopes up. I expect a negotiated settlement that allows only partial fixes to the problem, but a nice payday for the lawyers when they claim "victory."

[Steven Buhr]

Though I will say that the SEC and ACC network have done much, much better by pairing with services like AppleTV and Roku to purchase a subscription just to their network and use your streaming device.  I can't do the same with BTN.

This is a great point.

 

BTN is heralded as the most successful conference network and, to-date, that's almost certainly true.

 

However, they've so far locked themselves in to the MLB - ESPN - HBO model, which is to go to each cable/satellite system and convince them of the benefits of carrying your network (or, conversely, the danger of losing customers if they don't carry it). In doing so, they've been able to extort sizable rights fees from those carriers. But it is also locking them in to contracts that, one might suppose, could inhibit their expansion in to direct-to-consumer streaming options that other conferences are utilizing.

 

If HBO, however, is finding a way to blow off the cable/satellite companies, then maybe BTN and even ESPN may be able to eventually make a similar model work. But they'd better be working on it now.

[Steven Buhr]

I hope nobody holds shares of NFLX right now

Netflix stock took a little hit, as you'd expect when a significant new competitor moves in on their turf, but I'm not sure there's a significant threat to Netflix here.

 

I have both Netflix and HBO Go. I'm sure I watch 3 times as much Netflix, even if you would add the amount of "scheduled" HBO I watch via cable. Netflix' catalogue is simply that much more expansive than HBO's.

 

The great unknown, however, is the degree to which HBO will begin to adopt Netflix' model and significantly expand their inventory.

 

And here's where things also get interesting, to me. The competition between a couple of giants like Netflix and HBO could conceivably result in one (or more) expanding in to real-time sports programming.

 

In fact, eventually, I think they're going to have to in order to deliver the true knockout blow to cable/satellite.

 

In the end, I'm not sure we'll save any money, however. If we have to subscribe to HBO to get MLB and Netflix to get college sports and Hulu to get NHL and maybe pay the NFL directly to get their games, the costs will mount up and we'll still take a hit in the wallet.  But at least we'll all have the ability to decide for ourselves what we're willing to pay for.

[Brock Beauchamp]

Yeah, I don't think this is going to impact Netflix that greatly. They cover a much broader spectrum than HBO will ever cover, especially when it comes to television.

 

Netflix is one of the few services I buy that I would not consider canceling or changing providers. It's a top-notch service. HBO will be complementary, not competition.

[Mike Sixel]

amazon prime is a competitor of NFLX, not HBO......

 

I still regret not following my gut, and not buying NFLX after everyone said "I'm going to quit because of the DVD split" followed by the stock tanking, followed by it doubling in price when it turned out they grew membership......

[Brock Beauchamp]

amazon prime is a competitor of NFLX, not HBO......

 

I still regret not following my gut, and not buying NFLX after everyone said "I'm going to quit because of the DVD split" followed by the stock tanking, followed by it doubling in price when it turned out they grew membership......

I regret opting for Amazon stock in lieu of Netflix. Ugh.

 

But hey, I've absolutely killed on Apple stock this year so I can't complain too much.

[Mike Sixel]

I was doing AWESOME in the market until this month. I bought Apple a bit later than I wanted.....but all in all, it's been a good year financially. Which is good, since I now have a college freshman and 1 right behing him.....

[Brock Beauchamp]

I went tech-heavy several months ago so the dip hasn't really impacted me... Except for Amazon.

 

Damn you, Amazon.

[Mike Frasier Law]

Unfortunately, it wouldn't, "solve the blackout restrictions," if, like 95% of Iowans, you live in an area that is designated arbitrarily as part of the Twins' market (and the Royals and the Cardinals and the Cubs and the White Sox and the Brewers) but where Fox Sports North is not even an option from your local cable provider. Since Mediacom DOES make FSN available in some markets, one might hope that I would be able to simply click "Mediacom" and provide my acct number in order to get past the blackout firewall, even if my specific Mediacom account doesn't have FSN as an option... but I'm not expecting that to be the case. One way or another, I completely expect MLB and the Twins to continue screwing over residents of places like Iowa, Nevada and the Carolinas, where multiple teams claim the area as part of their home markets, even though their games are not available via cable, at any price.

 

One might hope the lawyers pressing this case would look out for everyone involved, but my experience with the profession tells me not to get my hopes up. I expect a negotiated settlement that allows only partial fixes to the problem, but a nice payday for the lawyers when they claim "victory."

 

I really hope you're wrong. One of MLB's arguments is that nearly everyone can watch every game of every team if they have cable and MLB.tv. But of course that isn't true, and the plaintiffs are relying on people in your situation to really play up the unfairness of the entire situation. I think they realize that they wouldn't sound as sympathetic if they only focused on people like me who don't want to pay for cable. 

 

However, considering how most class action lawsuits get resolved, I can't blame you for the sentiment. Keep in mind that, since this is a class action, the judge will have to approve the terms of any settlement. That gives me hope that any settlement won't leave you in the dark.