Netflix

[Arsilon]

And Slamz, Apple already has streaming on Apple TV, it's just a per-item approach, not an all-you-can-eat monthly subscription. I can buy or rent movies or TV shows, and stream them instantly. I know they are working on a subscription plan that will let you dump cable and just get the channels you want, but the cable providers are fighting tooth and nail to block it. But it's gonna happen sooner or later.

If they are able to pull this off, that will be the thing that will push it over the top.

[Grieve]

If they are able to pull this off, that will be the thing that will push it over the top.

http://gizmodo.com/5834698/wsj-says-appl...e-industry

What this could mean is an offensive against the cable industry akin to Apple's complete conquest over the music industry. A "subscription TV service," given successful licensing wrangling (a herculean task, we admit) could give us what we want from traditional cable TV: the stations we want, and only those stations. Imagine your Apple TV completely replacing your cable box—scroll through a list of networks, select the ones you want, and pay for them monthly. Their programming available on demand. Their live broadcasts, streamed. True internet TV. All the convenience of a DVR, all the vastness of a regular cable box, and all the sophisticated pleasure of an Apple TV.

[Arsilon]

If they are able to pull this off, that will be the thing that will push it over the top.

http://gizmodo.com/5834698/wsj-says-appl...e-industry

What this could mean is an offensive against the cable industry akin to Apple's complete conquest over the music industry. A "subscription TV service," given successful licensing wrangling (a herculean task, we admit) could give us what we want from traditional cable TV: the stations we want, and only those stations. Imagine your Apple TV completely replacing your cable box—scroll through a list of networks, select the ones you want, and pay for them monthly. Their programming available on demand. Their live broadcasts, streamed. True internet TV. All the convenience of a DVR, all the vastness of a regular cable box, and all the sophisticated pleasure of an Apple TV.

If they do it, I may have to convert to the Church of Jobs

[Slamz]

I wonder how that would work out, exactly... I mean, you can't kill the cable industry with Apple TV considering the cable industry is what's providing the broadband access most people would be using to watch Apple TV.

It might force the cable industry to start doing their own per-channel packages to compete, though. Either that or they'd get out of the TV business and just be internet providers, assuming that's something they can afford to do. (I've read before that the main reason cable companies don't want to offer per-channel packages is because they need a certain minimum per household to cover the hard costs of the business. Comcast's net income for 2010 was negative 3 billion... Per channel subscriptions that allow all viewers to reduce their cable costs by half or more might get real interesting.)

At any rate, it's a bit off topic, since I don't think per-channel streaming is going to compete with Netflix any more than having every channel competes with Netflix.

If anything, Netflix could do what Apple TV is trying to do, but the fight probably isn't with cable operators so much as it's with content suppliers. ABC probably just doesn't want to offer streaming of their shows online, unless it's through ABC.com (where they can then try to sell you DVDs, or at least get direct advertising dollars).



From an investment standpoint, anything related to television is big risk, in my opinion. Something is probably going to win big while everything else flops. I think within the next 10 years we could see some really major upheavals regarding how we get our entertainment content.

[Grieve]

Yes, that's exactly the problem...if Apple starts streaming everything, the cable providers just put caps on the amount of data you can stream over broadband, and suddenly streaming hours of TV/movies every day is a non-starter. They are heading that way anyway, just as the wireless providers are capping data on cellphones.

I briefly wondered if Apple could just buy the cable providers, but I see Comcast has a market cap of $65b, so I guess not. They could pick up Cablevision (Breand's outfit) for a mere $4b, though...

Here's another article on it that just showed up:

http://www.forbes.com/sites/briansolomon...-channels/

[Vanraw]

Its more then just the cable companies though. The TV networks are resisting the streaming, because they like the revenue to their own websites, not to mention the free advertising they get on other shows they produce. TV stations are starting to get firm with cable providers as well.

My bet is that the entire industry is about to go through a significant rate hike to consumers.

[Slamz]

Its more then just the cable companies though. The TV networks are resisting the streaming

Yeah, they could all be streaming their shows through Hulu right now if they wanted to. Hulu does manage to carry some shows, usually 1-7 days after it airs live, but it's far from complete coverage.

Really I don't even know what say the cable companies have in it. I think the primary block to all this is are the channels themselves.


And then there's things like "The Guild", which started off as sort of a pet project by some really minor Hollywood figures and has grown into a complete show, with streaming and DVD sales, bypassing traditional distribution methods entirely. Is that the future of entertainment?

Also, I think I may have mentioned before, but check this out:
http://studios.amazon.com/

What's Amazon up to? Producing their own movies?

I can easily see a time, say, 20 years from now, when "channels" as we know them today simply don't exist anymore.

[Slamz]

Interesting note from Amazon today:

Dear Customers,

Our Prime Instant Video team is on a roll. Today, we're announcing an agreement with Disney-ABC that adds 800 popular titles from ABC Studios, The Disney Channel, ABC Family, and Marvel. These new titles will bring the total to almost 13,000 TV shows and movies — all available for unlimited instant streaming.

The popular series Lost and Grey’s Anatomy will be ready for streaming tomorrow. Then, we’ll add other favorites including Felicity, The Disney Channel’s Phineas & Ferb, Marvel’s X-Men Evolution, and ABC Family shows like Greek and episodes from the most current season of The Secret Life of the American Teenager.

Disney-ABC joins recently announced deals with FOX, CBS, NBC-Universal, and PBS — just to name a few. We’ve added shows like Arrested Development, Firefly, The X-Files, every series of Star Trek, and Prison Break. You can watch on over 300 different devices, including our new Kindle Fire. Instant video streaming is a new benefit of Amazon Prime and is brought to you at no additional cost — Prime membership remains $79 a year.

I'm a Prime member on Amazon. That gets you free 2-day shipping on anything sold by Amazon (not 3rd party sellers on Amazon) and free streaming of whatever they put up for Prime, which now apparently includes all this other stuff.

It's still a pretty dismal selection but they do seem to be aggressively working on it.

[Vanraw]

Interesting on the Amazon Streaming.

Im beginning to think the future isnt channels going away, but having multiple streaming companies that you pay and subscribe to. Meaning the concept of Netflix having everything for a subscription cost will never happen. It will be more like a Premium channel / HBO / Showtime concept.

[Grieve]

Interesting note from Amazon today:

Netflix announced a similar deal with ABC/Disney yesterday, so it sounds like there a lot of dealmaking going on right now. Netflix definitely seems to be making more TV announcements than movies ones.

Talking of TV, apparently a Hulu Plus app is now ready for AppleTV. I wonder if they would accept an Amazon streaming app...

[Vanraw]

FYI on the hulu plus, I subscribed to this for a short period after hulu was added to xbox. Seriously disappointed.

First the plus didnt really provide that much more content. Second, it still had the commercials. Third, I kept running into shows I wanted to see that were flagged as "web only".

Seems to me that the only thing "plus" added was the ability to use the xbox and that didnt include much of the "web only" content. I disconnected service after about 2 months.

I dont even use hulu any more on the PC, as I usally just go to the networks web page to stream, or buy a season on zune / xbox.

[Vanraw]

This looks pretty bad for Netflix in the near term, at least until close to the end of 2012.

http://money.cnn.com/2011/11/22/technolo...ce=cnn_bin

One analyst predicted earlier this year that Netflix's streaming content licensing costs will rise from $180 million in 2010 to a whopping $2 billion in 2012. Netflix said in its filing on Monday that it has payments of more than $3.5 billion due over the next few years to pay for content under contract.

Meanwhile, Netflix is losing some of those all-important licenses. In September, Starz ended contract renewal negotiations with Netflix and said it will pull its movies and TV shows from Netflix early next year.

[Slamz]

Yeah, I'm tempted to buy into Netflix stock but it's still a question of "how low can it go".

I still don't see them going under. I would like to say it's possible that they overestimated the interest in streaming but I've also heard that Netflix is the internet's #1 single bandwidth consumer -- people like streaming, when they can get it, and Netflix streaming is part of what makes it possible to cancel cable.

So now I'm not sure if I should buy into it and we'll see Netflix at 150 by this time next year, or buy into it and we'll see Netflix at 15 (or lower) over the next 3 months... Netflix is a gamble.

[Breand]

Just read some of the Apple TV stuff on here...I would love to know how that would work, because currently it is ILLEGAL for cable companies to sell ala carte pricing. Believe me, they WANT to offer ala carte because they think they can make more money on it. It is the content creators that are fighting it tooth in nail, because currently they get a per subscriber profit on all of their channels, and they force cable to take all of their shitty channels in exchange for their 1 or 2 good ones.

I always say, look out how much your monthly prices for internet and phone have gone up with your cable company over the past 5 years, (most likely 0) and look at how much your cable bill has gone up. Paying off the content creators is why your cable bill is astronmical, and cable wants to have ala carte to cater to new customers that only want a few channels.

[Grieve]

How is illegal for them to sell a la carte for the bulk of channels, but yet legal for them to do it with HBO, Showtime, Starz, etc? I know those deals are for bundles of channels rather than a single channel at a time, but even that would be better than now. A cooking channel bundle, a news channel bundle, a stocks channel bundle (CNBC, Bloomberg, etc), a shopping channel bundle, a women's channel bundle (O, Lifetime, etc), a DIY bundle (HGTV, etc), and so on.

There is so much friggin' crap on our DirecTv subscription, and we truly only watch about 5 channels, with 90% of that on one channel (ABC) which we could get free over the air anyway (if we weren't so far out in the boonies...)

When they installed our Comcast internet, the tech showed me I could split the cable and get basic channels free without a subscription. So I'm going to do that once our DirectTv contract expires.

[Breand]

Here's the argument in a nutshell:

http://en.wikipedia.org/wiki/A_la_carte_...television

It's why, as an employee of a cable company, it always irks me that people jump down the providers' throats first, when almost always it is the programmers who control the market.

We can't have a segment of sports channels, cooking channels etc because different companies own all different kinds of channels and they want them sold as packages for themselves, and not "genre" packages that would be split up among different companies.

[Vanraw]

Dont know if you guys heard that verizon fios is going to be avaiable on xbox shortly. Sounds like microslop has finaly gotten a clue and is leveraging their embeded media player, and possible make it the end device for tv media.

I could see a future where companies like verizon fios, Time Warner, Comcast, etc al jump into the other companies geographic monopolies and compete without having to have phisical cable to the house. Good for consumers....

[Grieve]

Well I thought Apple or Microsoft might buy Netflix, but I never thought it would be Maul's outfit...

http://mobile.bloomberg.com/news/2011-12...cmpid=yhoo

[Vanraw]

Well I thought Apple or Microsoft might buy Netflix, but I never thought it would be Maul's outfit...

http://mobile.bloomberg.com/news/2011-12...cmpid=yhoo

Actually it would make allot of sense. We are very strong in the content distribution. Plus we still own like 55% of the back bone that all internet traffic uses.

Its not the side of the business Im involved with so this is the first I've heard of it .

[Grieve]

Well have a word with your colleagues and tell them that $280 a share is a good buyout number. That way I'll still may some money on my $265/$275 (yes, really) call spreads.

[Vanraw]

Well have a word with your colleagues and tell them that $280 a share is a good buyout number. That way I'll still may some money on my $265/$275 (yes, really) call spreads.

yea, Ill work on that /p

[Slamz]

I thought I was bad. I still have $120 stock.

Thought I was sitting pretty after it fell from $300!

(I also favor a $280 buyout....)

[Grieve]

If you hold onto it, I'm fairly sure it will get back above $120 in the next year or so.

My option spreads expire in January, however. I have FOUR option spreads - $275/285 and 270/280 (which I've held for almost a year and used to be WAY in the money), $160/170, and $120/$130. Total value about $2100, which will disappear in about a month.

Starting to get a little worried about whether any sort of year end/santa claus rally is going to happen with the market in general.

[Grieve]

Back to the "a la carte" TV programming, looks like Apple is still fighting for it:

http://tech.fortune.cnn.com/2011/12/28/s...revisited/

I really hope they do it. I recently read that ESPN alone costs $4.69 to include in any cable/satellite package, and almost all of them carry it. I NEVER watch ESPN. So basically I'm subsidizing the cost for anyone who does.

The next most expensive are Fox Sports (never watch), Nickelodeon (kids occasionally watch, but could skip it), ESPN2 (never), TNT (rarely), SciFi (only when BSG was on), and CNN.

Edit: Here's an out-of-date calculator, but the idea is sound.

http://www.howcableshouldbe.com/

Out of the whole list, I'd only choose to pay for CNBC (me), Disney (kids), ABC Family, TLC, and HGTV (all three for the wife). Which is $3.70 in total cost.

[Vanraw]

The real nirvana should be the shows you watch. The more I think about this the more I think it would be the best consumer route. Just like the music industry, where I buy a song, not an album.



Google TV made best run at this but seems like they were a bit early, as the networksndidnt sign up. In the end the networks are going to do what ever makes the most money.