It’s Not Just the Cable Companies I’m Worried About
There’s been a lot of worry lately in the industry about consumers detaching from cable companies and ‘cutting the chord’. Up until now, it hasn’t raised that many red flags for me because whether a consumer watches PBS through a television set or through an app of some kind, I know that we can find a viable way to distribute content.
Lately, it’s becoming increasingly clear, that it’s not a simple matter of viewers disconnecting from cable providers. Now, content creators are taking bigger steps to distance themselves from content distributors. Over the weekend Louis C.K., a famous comedian, distributed his new show online for $5. This means he didn’t have to wait for Comedy Central to approve his show or HBO to find a slot for him to air in-between shows of Boardwalk Empire. He went straight to the consumer. What happens when shows like Frontline & Newshour find distribution though a convoluted system such as PBS too messy and they forgo any provider whatsoever? Instead going straight to the viewer through their own app or online through a system like Netflix or AppleTV.
Now, one might argue that large scale shows like LOST or Game of Thrones could never get off the ground without money from a content distributor such as ABC or HBO. But I would counter that example with the new season of Arrested Development as my own example of the first steps in a new direction. Netflix purchased the rights to produce & distribute the new episodes of Arrested Development. And with new players such as YouTube & Hulu becoming content providers as well, it’s just a matter of time before we see an even more direct distribution method than what we have today.
People say that cable companies are in trouble - I now believe that even TV networks are in trouble.
Cutting The Cord
I would bet that a lot of folks cancelling are like us. We can afford it, but we just don’t see the value. We don’t watch enough to want to pay the rates that seem way out of line with what we’re getting and using. Even more ridiculous, though, is that the AP mentions this kind of reasoning as a problem rather than an opportunity for the industry
I don’t buy it. The economy IS bad and right now during Summer re-runs not many people ARE watching TV. But once Football and the new Fall season returns, TV watching will pick back up again. TV is like anything else - it’s cyclical.
Source: techdirt.com
Peel Kills Remotes & Your Cable Company’s Crappy UI
This looks promising - although a bit expensive
But what’s particularly alluring is that the interface is molded by your own preferences: You can say what you like, you can search by genre, and over time, the app’s AI starts to recognize your viewing patterns and makes suitable suggestions. In addition to controlling your TV, audio, and DVR, Peel also has a social function, so that you can share what you’re watching with friends.
Source: fastcodesign.com
Cutting The Chord Analysis
With the announcement of the Apple TV and then the new Hulu Plus this fall, I (like many others) had grand visions of what is commonly called “cutting the chord”. Meaning, that I wanted to get out of my expensive cable contract and watch all my TV shows using only online media. After all, Apple was now touting HD $.99 rentals and Hulu Plus had just arrived with an $8/month price tag. Those two outlets, plus my current subscription with Netflix and I was sure I could now cut that expensive cable chord. Boy was I wrong.
**Disclosure: For what it’s worth, I work in the TV industry and have worked at major cable networks.
The Parameters
I had a few requirements/parameters when I did my research. First, all the shows had to be in HD. I wasn’t going to sacrifice quality. And since I just bought a brand new 55” 3D TV, I wanted everything to be the best quality it could be - within reason. Secondly, I would constrain the timeframe to 4 months (September thru December). That way, I could match my cable bill squarely up against the new online option.
The Current Setup
The first thing I needed to determine was how much my current setup was costing me. After a few phone calls to the cable company I got these figures:
Current Setup: HD, DVR Cable + Internet
Total Bill: ($168/mo.): $672
Then, I wanted this comparison to be apples to apples so the figure had to represent JUST the cable package and NOT cable plus internet.
Internet: ($44.95 + $5.00 with Cable Package/mo.): $200
Adj Cost (Cable Only): $472
This was the number I had to beat with the online option - $472. If the online option was cheaper than this, then it would be better for me to cut the chord.
The List
Next, I set out to create a list of all the different shows I watched on a regular basis and that I wanted to continue watching for the remainder of the season. The complete season of these shows are included in the cable’s $472 figure so I needed to find everyone of these online somewhere. Here’s the list…don’t judge me!
- Glee
- Human Target
- Family Guy
- Modern Family
- Cougar Town
- Community
- The League
- How I met your Mother
- Its Always Sunny in Philadelphia
- Hawaii Five O
- The Walking Dead
- CSI
- The Office
- The Event
- The Mentalist
I went to iTunes first, trying to find the shows under the HD rental section. But what I found out was that most of the shows I wanted to watch weren’t available to rent - only purchase, which dramatically increased the cost.
Next, I went through Hulu Plus and cross referenced my findings with the iTunes list - crossing off the ones in iTunes that I found under Hulu Plus. The problem though with Hulu was that some of the shows weren’t licensed to Hulu and the site just redirected you to the networks main site.
Pricing
I started pricing out the different shows and how much they’d cost. Here’s how it broke down:
iTunes ($.99 HD Rentals)
- Glee: x10, $10
- Human Target: x4, $4
- Family Guy: x6, $6
- Modern Family: x10, $10
- Cougar Town: x10, $10
Sub Total: $4
** Yep, that’s right. I could only find HD rentals for 5 of the 15 shows. After cross referencing those 5 against what was available on Hulu, I was only going to be renting one show. Disappointing.
——————————————————
iTunes (HD Purchase)
- Community: $55 Season
- The League: $32 Season
- How I met your Mother: $53 Season
- Its Always Sunny in Philadelphia: $28 Season
- Hawaii Five O: $56 Season
- The Walking Dead: $16 Season
- CSI: $58 Season
- The Office: $60 Season
- The Event: $50 Season
Sub Total: $298
** This was really disappointing. The seasons of the shows cost quite a bit. And it seams there is no standardized pricing. Each shows full season was a different price. After cross referencing those 9 against what was available on Hulu, I was going to have to purchase 7 full seasons of shows.
——————————————————
Hulu Plus - $8/month
- Family Guy
- Cougar Town
- The Event
- Glee
- Modern Family
- The Office
** Sadly, I couldn’t find ‘The Mentalist’ as of this posting, so I would have to lose that one. And you can’t access live sports or news yet online so no more Auburn football. That’s a big deal breaker for some people. I just figured I’d go to the local sports bar. The Online Totals The final step was to add everything up:
Online Only Setup: Internet w/iTunes & Hulu Plus
Internet Only: ($60/mo.): $240
Hulu Plus: ($8/mo.): $32
iTunes: ($4+$298): $302
Total Cost: $574
**NOTE: Cable companies give you a break when you package your internet with your cable subscription. If you decide to go Internet only, they’re going to charge you more. And if more and more people start to cut their cable subscriptions, then the cable companies with have no choice but to raise rates on their internet packages - perhaps even go to a tiered pricing system.
The Results
This was very disappointing. The cable option was $472 and the online option was $574. Cutting the chord was way more expensive that I had previously thought. These results might not be perfect but they show that, despite all the marketing and news reports about customer subscription rates dropping, this technology just isn’t up to par with my old fashioned cable subscription - yet!
