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The Future of the Pay TV Industry

Discussion in 'TiVo Coffee House - TiVo Discussion' started by Bigg, Apr 16, 2018.

  1. Bigg

    Bigg Cord Cutter

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    So cord cutting is here, and it's real. TiVo has one foot in the old world of pay tv, and one in the new world of cord-cutting.

    What do you guys think the pay tv industry is going to look like in 10 years? How many channels? What will people be paying for or not paying for?
     
  2. foghorn2

    foghorn2 Active Member

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    It should be called "Pay To Watch Endless Commercials TV Industry"
     
    Bigg likes this.
  3. johnfasc

    johnfasc Member

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    As long as cable companies control the internet we will always pay. Tv or not. It looks like, as they lose customers to OTA, Netflix, Amazon etc they will just keep internet pricing high. And with hardly any competition ( we have none, either pay spectrum or go without) they can charge whatever until the FTC steps in. Also with the advent of Sling TV, and now mini cable packages, Hulu etc you will be paying more people for the same thing the cable companies should have done long ago. Personally I am happy with OTA and Amazon. How much tv can you watch?
     
  4. smark

    smark Active Member

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    Simple. Prices will stay the same, things will move to cloud DVR/VOD and non-fast forward-able commercials. Cord cutting isn't really happening, cord shaving is.
     
  5. Bigg

    Bigg Cord Cutter

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    Definitely. I think what the cable companies are going to do is continue to use extortion rackets against the big video CDNs like Amazon, Google, and Netflix. Why pay for content when they can get paid to just be there as an ISP and not really do anything? They'll get paid twice to do the same thing, as they already do with many video providers and CDNs.

    Cord cutting really is happening. Cord shaving is also happening. Comcast and the cable companies are hiding millions of would-be cord cutters behind bundles that are not profitable (compared to internet-only) for the cable companies. When Wall Street realizes this and cable companies get rid of the cheap bundles, there will be several million MORE cord cutters.

    So given that, what do you think will happen to the pay tv industry? How will channels fail or consolidate or go bankrupt?
     
  6. zalusky

    zalusky Well-Known Member TCF Club

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    We have moved from 80% commercial show viewing to 20% commercial viewing. Netflix, Amazon, HBO, Showtime, and Starz are leading the way. Shows like Greys Anatomy, some cooking shows, late night, and Hockey are all that’s left in the commercial arena.
     
    Bigg likes this.
  7. Bigg

    Bigg Cord Cutter

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    I'll give my predictions, since I'm asking everyone else. I think cord cutting will continue to accelerate, and over the course of the next few years, the super cheap bundles will disappear, causing several million more people to cut the cord.

    I think within the next couple of years, we will see dozens, if not hundreds, of specialty, low-viewership cable channels failing and going out of business, along with some successful new entrants into the OTT SVOD space, mostly niche content, a few of them former cable tv channels, others entirely new.

    I forsee that the end game will be MVPDs and vMVPDs competing on a pretty level field for much lower priced, and much smaller bundles than what we have today, partly because people just aren't willing to pay for the mega-bundles, but also partly because there just won't be as many channels. I think some of the major content owners, especially Viacom, will find that the prices they get for their content will be much lower, partially due to how much they are over-charging now, but partially due to the increased power and size of AT&T, Comcast, and Charter.

    I predict that by 2030 at the latest, the market penetration of all pay-tv services, including vMVPDs, will be below 50%.
     
  8. mrizzo80

    mrizzo80 Well-Known Member

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    I'm not going to make any specific predictions, but the "trend is your friend." The trend will continue unabated.

    It's fascinating to watch the shift in how we consume entertainment content.
     
    Bigg likes this.
  9. mattyro7878

    mattyro7878 Active Member

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    I just started a thread about how shocked I was to get such a great offer from my cable provider MINUTES AFTER CANCELLING TV! So they are making a lot of money, the ratios are huge. That will change. TV will be cheaper as long as it is bundled with internet. Better to make a little than none. Choices will be more varied and of better quality. You will be able to roll up your tv like a map and watch it anywhere.
     
  10. steelersruleman

    steelersruleman Member

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    Cord shaving is happening, not cord cutting. TRUE cord CUTTING would involve DUMPING your local cable company altogether. Meaning unless you have another way of obtaining High Speed Internet from another source right now, you are SOL, and are shaving, not cutting.

    Therefore, I foresee ALL programming being sent through the incoming cable through the internet, therefore eliminating all cable boxes altogether, including TIVO. Would not invest in one right now. It will all be done on the cloud

    I have had my Roamio for 4 years now with lifetime. I am now on the plus side of things. Would not start a new lifetime now, even if my current one dropped dead(unless I got one SUPER CHEAP on EBay).

    And since everything will be done over the Internet(called OTT, right? I think I may be screwing up the acronym), the destruction of the Net Neutrality Laws, as of right now, would help destroy competition. Not to mention the bigger threat to American Society(Censorship), but that is a political issue not to be discussed here.

    The Cable companies could THROTTLE services like Netflix, HULU, Amazon PRIME, SLINGTV, YOUTUBETV, Playstation VUE, etc.. because it is not THEIR ONLINE SERVICE.

    Don't think Spectrum or Comcast would ever do such a thing,right? Uh huh:rolleyes:
     
  11. tenthplanet

    tenthplanet Active Member

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    Less subscription aggregation , content producers that are large will call the shots even more then they do now and stream their own things. Studios will call the shots more then internet/cable/satellite providers. people will curse out Disney way more than Comcast. Content providers (how dare these greedy companies actually charge for things) will be the new villains. The Interent will still be buggy, congested, and never be as cheap as people think it should. AND...People will still argue about OTA antennaes :D:eek:
     
    Bigg likes this.
  12. Bigg

    Bigg Cord Cutter

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    Great way to sum it up!

    That's literally not what cord shaving means. Cord shaving is keeping a TV package with locals only, or a minimal number of cable channels. Cancelling TV and keeping internet is cutting the cord.

    True. I love my Roamio OTA, but in a couple of years, I will have to replace it with an ATSC 3.0 model.

    I think this is a valid concern, but I find it more likely that Netflix, Amazon, and the like continue to pay "protection money" so that their bits don't have any "accidents" along the way, and that cost will be built into the streaming services, so the cable companies will be able to charge twice for the same exact service.
     
  13. steelersruleman

    steelersruleman Member

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    Don't want to get into an semantics fight into what "shaving" means, as opposed to "cutting", so I am going to just drop it from here. You say TOMATO, I say TOMATO(think you know what I mean). We both agree in the end though.

    But the throttling thing will definitely happen, unless either Congress shoots down the FCC ruling, or each individual state starts creating new laws in order to go back to the old rules, or establish new rules that are even stricter. I think California is in the process of doing that right now. And, of course, the cable conglomerates are having conniption over it. Hope it passes, and other states follow suit with there own accords.

    I'll just take a wait and see approach from here. Nothing more I can do other than vote when the time comes either with my money, or my actual vote....
     
    mschnebly likes this.
  14. Dan203

    Dan203 Super Moderator Staff Member TCF Club

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    I think cable companies are going to split. They're going to split their programming off into an OTT service like PSVue, Sling, etc... and use their physical infrastructure exclusively for internet access. They'll likely offer discounts, bundles and maybe even bandwidth cap waivers to use their video app rather then a competitor, but it'll essentially be two separate entities. (like AT&T and DirecTV are now) QAM is dead. And if you're going to go all IP anyway why not create an OTT service you can offer nationwide rather then only in the areasyou physically serve? I believe Verizon recently stopped their IP beta test specifically to do this. I suspect the other big cable companies will do the same.
     
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  15. dstoffa

    dstoffa Member

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    Younger people do not consume television the same way as their elders. This is a problem for the media conglomerates (especially those who pay for the right to air professional sports, as the demographic they want to sell ads to are not buying into the program - see ESPN), and not necessarily the cable companies. The cable companies know the future is in data, not in linear television.

    For the pay-tv content generators? Trouble. (I don't feel sorry for abc-Disney, CBS, NBC, or FOX), but I might feel sorry for some athletes who won't get their pay-day when TV money runs out..

    For the pay-tv content deliverers? Their revenue will move from one pile to the other. Entertainment means data transfers...
     
  16. Bigg

    Bigg Cord Cutter

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    The cable conglomerates are definitely have a conniption over it. However, I think that Netflix and the other CDNs will keep paying up, at least to a point, and avoiding throttling as a result. That's effectively what they are doing now with the paid peering. Comcast told them they need to pay protection money to avoid "accidents" and they paid the protection money. Classic mob shakedown.

    The big CDNs players in video today do have a weirdly vested interest in being extorted, as any new start-up has to then either pay up themselves, or have to go through those few CDNs like Akamai, Limelight, Cachefly, and a few others, who pay the protection money to get good access to the ISP's networks, and act as gatekeepers in a way.

    I think this is an interesting idea, but it's going to force them to compete directly to OTT solutions, and it can't leverage IPTV multicast the same way that managed IPTV can. In the end, you may well be right though. They will have to offer some bundling, but it may end up delivered technically more like CoIP/vMVPD than as the MVPD that they are.

    I'm not sure I really feel sorry for athletes. They're way overpaid for what they do. They work hard, but not tens of millions of dollars hard. Unfortunately, it may end up screwing the little guy too, even though in theory, it should come out of the big stars' pay the most, as they are the most overvalued in the industry.

    What do you think is going to happen to the big media companies and broadcasters? Will Disney make their own streaming service and make it a success? Will others follow suit? How many streaming services can survive at once?

    Yeah, I think that's where it's already going as people cut the cord, and basic internet is now $75/mo in Comcast monopoly areas.
     
  17. dstoffa

    dstoffa Member

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    Hence my word, "some". I definitely won't be feeling sorry for all of them.

    If revenue from streaming does not exceed revenue from linear cable on a per-subscriber basis, they are going to need to rethink their business model and adjust accordingly. I see the sunset of marginally viewed channels in the future. I see ESPN and their sports division being their biggest problem moving forward. I don't see anyone paying $9 per month to stream ESPN. It's not must-watch television anymore. Once uponi a time watching Keith and Dan do the big show was a must see. Now, I can get everything from my phone or computer. Sportscenter is hitting the skids. They only thing they have left is their professional sports. That leave a lot of day-parts to fill.

    In summary - I see consolidation and a thinning of the herd in way of broadcasting.

    Broadband internet was $30 per month 15 years ago.... Which would be $47 today, but since speeds are much higher, the prices aren't that high... You just can't get 5/1 from your cable company for $20.... (Well, there are exceptions, but few are far between).
     
  18. dfreybur

    dfreybur Active Member

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    When we moved in 4 years ago we had a one year cable contract but we already had two broadband companies to chose from. At the one year point we switched to the other broadband company cutting the cable. Around a year ago Google Fiber came through as an option.

    Depending your local population density choice will eventually happen where you are.

    We have a new UHD smart TV that is networked and has Roku. Eventually the OTA and DVR aspects of Tivo will be beat by on-line stream.

    Just as choice among broadband vendors is supposed to improve quality, it's also supposed to handle Net Neutrality. We all know how that ends up.

    The cable companies took on content creation at the influence of the broadcast networks faded. Now streaming providers are taking over content creation.

    Using Tivo taught me that live is pointless for everything but news. Using streams taught me that I could locate streamed live news but as long as I have OTA it's not worth the additional effort.

    Tivo using SSD inside a smart TV organizing stream vendors with a merged show database. The number of hours recorded can drop pretty low. Except for the Hulu problem. Hours recorded could become hours of stream cached in anticipation of what you're watching lately. That triggers the endless battle of avoiding commercials.
     
  19. Bigg

    Bigg Cord Cutter

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    That's a good point about Sportscenter. I've never understood what the point of Sportscenter was in the first place, it always seemed like filler, but I know a lot of people watch it, or at least used to. I think you're spot on about ESPN, I would add some of the other major sports channels too, but ESPN is by far the biggest, and will have the biggest problems moving forward. I see a double threat to ESPN and other cable channels, in that people are subscribing to smaller, leaner CoIP/vMVPD packages that exclude many smaller channels, and that people who just want sports might sign up for DTV NOW at the beginning of "their" sport's season, and then unsubscribe after, leaving significantly fewer overall subscribers at any give point during the year for ESPN and the like.

    I'd agree.

    We went from $57/mo to $75/mo, which is actually about at inflation, it just started ridiculously high, so it's still ridiculously high.

    I highly doubt it. There is little incentive to wire a lot of suburban/exurban areas that currently have one monopoly provider. If anything, I'd say there is more hope for some rural areas that don't have anything, as whoever builds infrastructure there will likely be a monopoly for a very long time.
     
  20. NashGuy

    NashGuy Well-Known Member

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    Yup, Dan is right on here. It's at least part of the thinking behind AT&T dumping Uverse TV and replacing it with a forthcoming OTT service (AT&T TV or whatever they end up branding it). And as he says, it was likely a factor in Verizon's decision not to move forward with the managed IPTV service they were beta testing; instead, they're supposedly still working on a nationwide OTT vMVPD offering. Even Comcast may be changing their mind. Last year they rolled out their Xfinity Instant TV managed IPTV service, insisting that it didn't make economic sense to extend it out of footprint as an OTT vMPVD. But now, as they play footsie with Sky TV (which they hope to acquire), they say they may be changing their tune. "They're doing streaming out-of-market, which is something we're not doing today at Comcast," Roberts said, "so they'll bring some learnings there."

    As far as multicast, I don't think it's that big of a deal. I would bet that techs can engineer it so that the most popular linear channels run in multicast IP across the provider's own network, thereby economizing the bandwidth necessary for their own OTT service. However, a provider can't put their own multicast IP on someone else's network (at least without an agreement). But so what? Let it run as unicast there; increased video traffic on a competitor's network is their problem. So, for example, if I have AT&T TV and I'm on AT&T Internet, when I watch live ESPN, it would be through a multicast stream that travels exclusively across the AT&T network. But if instead I have AT&T TV via Comcast internet, AT&T's edge network will switch the ESPN multicast stream into a unicast stream to send out over non-AT&T networks, including the final leg on Comcast's network, to my home.

    Interesting side note: Cloud tech already exists to monitor real-time channel usage within a network node and determine on-the-fly which channels to present in multicast and which to present in unicast to optimize network efficiency. See this article for that and other interesting stuff on the tech behind managed IPTV and its transition to OTT/all-HTTP.
     

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