Posts Categorized: Sony

Is TV having a dialectical moment?

Posted by & filed under Blog, Competition, Content, DISH, Opinion, OTT, Sony.

tv_snow_flickr_panos3
As counter intuitive as it may seem, the emerging range of online video services might give pay TV subscribers little incentive to cut the cord, reunite existing cord-cutters back with pay TV, and even start driving would-be cord-nevers to adopt pay TV.

The conventional wisdom about OTT has been that the cost of online TV would be much lower than for traditional pay TV.  Along comes DISH Network’s Sling TV, which only seems to reinforce that point.   Comparing Sling TV’s $20/month with the typical entry-level pay TV package at $40/month – excluding monthly service and equipment fees – seems to bear that out.

Or does it?

A reality-check against the conventional wisdom

For the first time, there are enough actual online TV services that it’s becoming possible to make an objective comparison.  So, let’s compare:

Basic Pay TV (for about $40 per month)

  • Broadcast networks: CBS, NBC, ABC and Fox
  • Networks found on pay TV: AMC Networks, CBS, Discovery Communications, The Walt Disney Company, Netwarko Grupo (Latino), Scripps Networks, Time Warner, Viacom and others

Online TV (…for about $40 per month!)

  • DISH Sling TV ($20/month): AMC Networks, Disney/ABC, Netwarko Grupo, Scripps Networks, Time Warner
  • Sony Playstation Vue (TBD, but let’s say $20/month): CBS, Discovery, Fox, NBC Universal, Scripps, Time Warner, Viacom
  • Broadcast networks (live linear): Sony will offer CBS and Fox linear feeds in selected local markets.
  • Or in place of Sony, you can opt for a combination of CBS All Access (which offers  CBS linear feeds) plus HBO’s upcoming direct-to-consumer online TV service; probably for about the same $20/mo.

You might have noticed that Sling TV’s programming and Sony’s are almost mutually exclusive.  They have only Scripps and Time Warner in common.  So, an online-only subscriber who wants to come at all close to replicating a traditional MVPD’s line-up would need both DISH and Sony.

Is price the right metric for comparison?

My comparison make it look as if there’s price parity between online and pay TV, but this is not a truly fair comparison.  Pay TV’s $40/mo for pay TV excludes monthly equipment rental and service fees; which bring it to about $60-70/month.  Not to mention what the price might rise to after the new-subscriber promotional period wears off.

Okay: $60-$70/mo for pay TV, versus $40/mo for online.  But unless the online subscriber abandons their Netflix, Hulu and/or Amazon Instant Video (or Prime) accounts – and many online subscribers take two or even all three of those, at about $10 each per month, plus or minus – the price comparison again comes closer to parity.  (And let’s also acknowledge that $60-$70 price points are a lot higher than many of us envisioned…)

Both may taste great, but one may be less filling

Purely on the basis of the number of available channels, pay TV wins.  Compare the lineups and prices from Comcast, AT&T U-verse and DISH Network (not SlingTV) with those from SlingTV and Sony Playstation Vue.  Add all of the local and independent channels, and live local sports programming that you don’t get online.

One might protest that you can fill the local sports gap with online programming from professional sports leagues.  But MLB.TV blocks programming for local games, in order to drive people back to local broadcast or pay TV.   This may change, but for now, that’s the way it is.  Plus, my local MLB games are included with my pay TV subscription, but MLB.TV starts at $19.95 per month.  Yikes!

This situation makes me wonder: was it the plan all along to drive people back to pay TV?  In the end, there may be very little incentive for pay TV subscribers to cut the cord, and very little reason for cord-nevers not to ultimately adopt the pay TV cord.  DISH Network, for one, might be quite pleased with such a turn of events – and maybe this was DISH’s objective all along.

It comes down to priorities.  Would you be satisfied enough with the limited lineups of online TV, and okay with filling the gaps with services from individual networks?  Many people are.  Many people are not.

Is TV having a dialectical moment?

In the discipline of philosophy, there is a method of resolving disagreements, called the dialectic process, which consists of a thesis, an antithesis, and a synthesis.  Here, the thesis has been that OTT would drive people from pay TV.  The antithesis has been the empire striking back, that pay TV would have sufficient value stem cord-cutting.

But this also can take an entirely different direction.  The synthesis might be the emergence of the “hybrid subscriber,” in which one might take pay TV for local news and live sports, plus whatever else they get with the lowest cost basic subscription, and then get his or her premium content online from Hulu and perhaps HBO.  In any of these scenarios, the alternatives might add up pretty close: a cord-never might end up paying the same as a pay TV subscriber would pay.

Google and TV again? Ranking the Odds of the TV Outsiders

Posted by & filed under Android, Apple, Apps, Google TV, Intel, Mediaroom, Microsoft, Opinion, Sony.

[ Updated August 22: The New York Times and The Wall Street Journal have both reported Sony to be negotiating with Viacom and others, in preparation for an OTT TV service.  This raises Sony’s odds.]

This week, The New York Times and The Wall Street Journal both reported on efforts being mounted by Google to launch an “Internet cable TV service” (an oxymoron). Joining Intel, Sony, Microsoft, Apple and others. Let’s look at them one at a time.

Intel is on the record as hoping to launch its own consumer Internet TV service, although in my opinion – even if they DO launch a service, which they insist they will – a service is not Intel’s true intention in that space. Instead, it’s another market-seeding effort – which Intel has done in the past with set-top box reference designs and software SDKs to drive that industry’s adoption of Intel processors. In other words, a retail TV service might be the icing on a different cake.

For years, Apple TV has been Apple’s entry into the streaming video player market space, and the TV vector of Apple’s device-content-software ecosystem. After many rumors have come and gone, Apple is now reportly “playing nice” in the pay TV industry sandbox. People forget that Apple has been on the side of Big Media for years. The same strategy worked for them with the music industry a decade ago. Also, most pay TV operators, premium pay TV programmers and TV networks offer apps designed to work on iPads, iPhones, and iPod Touch devices (and on the Mac via a Web browser). Steve Jobs became the largest shareholder of The Walt Disney Company when he sold Pixar to them. And now, Sky News, ESPN, HBO Go (among others) have launched apps designed expressly for Apple TV. Bottom line, Apple is both a friend and a friendly distribution channel; not a threat.

Then there are Sony and Microsoft. Over the past year, reports have had both of them taking runs of their own at being “Internet TV providers.” Sony’s effort sounds ambitious, but the rumor mill had gone quiet. They’d have some chance, by virtue that Sony is a media company (Sony Pictures) and the PlayStation is a content ecosystem; not just a game platform.

AT&T offered a special kit for Microsoft’s Xbox 360, to make it compatible with AT&T U-verse IPTV, although sales of that add-on have been suspended. Microsoft also offers branded apps from Comcast, Verizon and a number of TV programmers via Xbox Live. But Microsoft’s efforts to launch its own TV service by negotiating directly with TV programmers ran onto the rocks.

I was originally inspired to write this article because I started thinking how Google might have a better chance than any of these competitors. The TV networks are distrought over the fact that audience measurement for online video is not comprehensive, making advertisers leery of advertising in that medium. Meanwhile, 97% of Google’s revenue is from online advertising, so you’d think they’re onto something (See *** below). But a number of other TV programming distributors offer online platforms and already have relationships with the networks. Also, Google would expect a share of any ad revenue and is no friend of pay TV or broadband providers, particularly in cities where Google is building its own broadband service.

Not to mention that Google has taken other runs at the TV opportunity, most notably with Google TV, a noteworty technology that happened to be one of the great failures of high-tech marketing. Google TV cost Logitech millions of dollars, and their CEO his job. For its part, Google did nothing to correct the misperception that Google TV was a service, instead of the TV middleware that it actually was. [ Update July 26: Google has launched yet another TV device, Chromecast ]

So, here’s how I rank their chances at launching and sustaining an online TV service:

  • Google: 0%, for having alienated the TV industry, which is highly resistant to change
  • Microsoft: 0%, because they don’t instill confidence that they can succeed. Consider the recent launches of Windows 8, Xbox One, Surface, Windows Phone, and Microsoft’s exit of the IPTV middleware category (Mediaroom) only after becoming a leading supplier.
  • Sony: 50% because they are working with TV industry players and because they are a content owner themselves.  Also, they are in the process of revitalizing the Playstation ecosystem. [ Note: I previously was saying they had a 10% chance. ]
  • Intel: 50%, because they appear to be trying to work within the parameters of the TV industry. If the retail service fails, it’s not the end because a service is only part of Intel’s true agenda despite what they say.
  • Apple: 100% if they collaborate with the pay TV industry. Apple’s ecosystem is the broadest and deepest (albeit sans games). Also, Apple gets credit for having saved the music distribution industry’s bacon.

Samsung is a huge wild-card here. They have a device and in-home distribution product ecosystem and have been successful in extending Android into something useful, but Samsung has not announced any intentions of their own, other than partnering with content companies and distributors (pay TV, Redbox Instant and a few others)…

Staying tuned!

*** I’ve begun to think of Google Search, Android and Chrome as ad-malware. But that’s a whole ‘nother rant, for the next episode of “Why can’t I download that Android app without accepting its terms to track my location and phone usage?” I’m saying to myself “Get over it or switch!” and from my tone, you might guess my decision.