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Message
re: Sling TV Releases Sports Package - $5 Per Month
Posted on 2/9/15 at 9:26 am to Dr RC
Posted on 2/9/15 at 9:26 am to Dr RC
quote:
On top of that, the demand is not as high as y'all seem to think.
Methinks you need to brush up on your supply/demand curve.
If demand is not high, they cannot charge a high price.
They will have to find the sweet spot to generate the most possible income.
And their contracts with the sports league are of no concern to consumers. If they can't pay up, it is up to them to make up the revenue elsewhere. That's how the market works. The only reason they payed those huge figures to broadcast games is because they know they have 100 million subscribers through cable, as do the sports leagues. The price would be different if viewership was different.
ETA: consumers control pricing in a free market, not the other way around (aside from monopolies, which we could argue cable companies are actually, but that's a whole different topic).
This post was edited on 2/9/15 at 9:32 am
1
Posted on 2/9/15 at 9:34 am to rintintin
quote:
If demand is not high, they cannot charge a high price.
Their entire buisiness model is based on having a high subscriber base. They cannot function if their revenue stream is suddenly cut in half (or even lower)
quote:
And their contracts with the sports league are of no concern to consumers. If they can't pay up, it is up to them to make up the revenue elsewhere. That's how the market works. The only reason they payed those huge figures to broadcast games is because they know they have 100 million subscribers through cable. The price would be different if viewership was different.
Their contracts with sports entities ARE of concern to the consumers. Again, they can't simply tear those contracts up and tell the content providers their can't pay them money owed. The only reason ESPN is as cheap as it is now is because they have 100 million subs to help lower costs to current subscribers.
What other revenue streams could they possibly create other than more advertising? Advertisers are not going to be able to make up the difference in lost revenue from subscribers.
ESPN doesn't actually create own or content that people want to see so they cannot "find a sweet spot".
ESPN is a middle man and w/current the current middle man cable structure remaining in place they cannot exist.
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