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re: Sling TV Releases Sports Package - $5 Per Month
Posted on 2/9/15 at 8:53 am to PrimeTime Money
Posted on 2/9/15 at 8:53 am to PrimeTime Money
Correction, people on previous pages are saying a la cart for the ESPN network would cost $80-100. My reply does not change...it is ludicrous to believe that consumers would pay that. In an a la cart scenario, ESPN network would need to be $10 just like someone who buys HBO today.
A la cart has to be cheaper with less options than today. That means somewhere between 10-20 channels for $30-40 a month.
If price rises higher than that, then a la cart makes no sense.
A la cart has to be cheaper with less options than today. That means somewhere between 10-20 channels for $30-40 a month.
If price rises higher than that, then a la cart makes no sense.
3
Posted on 2/9/15 at 9:02 am to lynxcat
no, I said ESPN by itself would be a minimum of $35ish w/a more likely price of around $50. To get ESPN, ESPN2, ESPN3, ESPNU, and SECN it would be around $100+.
There is no way for ESPN to sell their channel for a simple $10 a month in an a la carte world b/c there is no way they would ever get anywhere near 100 million subscribers. Sports programing, while popular, is not as popular as people here seem to think. Again, their highest viewership ever was 27 million tvs. Their highest average viewership for anything they air is Monday Night Football at around 13 million.
ESPN would have to charge a larger price b/c they have deals with all the various sports content providers. They can't just tell the somebody like the NBA "Oopsie, everything is a la carte now so we aren't going to pay you the money from that billion dollar deal we just inked."
There is no way for ESPN to sell their channel for a simple $10 a month in an a la carte world b/c there is no way they would ever get anywhere near 100 million subscribers. Sports programing, while popular, is not as popular as people here seem to think. Again, their highest viewership ever was 27 million tvs. Their highest average viewership for anything they air is Monday Night Football at around 13 million.
ESPN would have to charge a larger price b/c they have deals with all the various sports content providers. They can't just tell the somebody like the NBA "Oopsie, everything is a la carte now so we aren't going to pay you the money from that billion dollar deal we just inked."
This post was edited on 2/9/15 at 9:07 am
Posted on 2/9/15 at 9:05 am to lynxcat
quote:
Correction, people on previous pages are saying a la cart for the ESPN network would cost $80-100. My reply does not change...it is ludicrous to believe that consumers would pay that. In an a la cart scenario, ESPN network would need to be $10 just like someone who buys HBO today.
Correct. The posters are making nice arguments using actual numbers, but as you said they are ignoring the demand factor. If ESPN charged $100/mo they wouldn't get any subscribers, I don't care how much you like sports. They would be forced to lower price due to demand.
Sure it would prob hurt ESPN's bottom line in the short term, but as all companies are forced to do in an ever changing society, they would have to adapt and find alternative avenues of revenue.
The consumer wins in the end with a free market.
Posted on 2/9/15 at 9:06 am to Dr RC
quote:
There is no way for ESPN to sell their channel for a simple $10 a month in an a la carte world b/c there is no way they would ever get close to 100 million subscribers. Sports programing, while popular, is not as popular as people here seem to think.
You are ignoring the laws of supply and demand.
Posted on 2/9/15 at 9:08 am to rintintin
No, I'm not. I'm looking at the fact that they MUST honor their deals with sports content providers and to do that its impossible for them to charge the low prices some seem to think they would provide. On top of that, the demand is not as high as y'all seem to think. Again, their highest rated content on average is Monday Night Football at 13 million TV sets. Even if you are generous and assume they get those 13 million plus another 7 million or so for other sports ona year round subscription, that's still 80 million less subscribers than they currently have. They would have to make up for that lost revenue to make a profit. They aren't going to be able to do that with simply upping the price for commercial time.
This post was edited on 2/9/15 at 9:15 am
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
Posted on 2/9/15 at 9:32 am to lynxcat
I said ESPN would be like a premium movie channel like HBO. And HBO is like $20 per month.
I believe I also mentioned that networks would have to charge a lot to make the same profit they were making with the current model, however, people would not pay as much as ESPN would need them to pay. Therefore, they'd make a lot less than they are currently making.
I believe I also mentioned that networks would have to charge a lot to make the same profit they were making with the current model, however, people would not pay as much as ESPN would need them to pay. Therefore, they'd make a lot less than they are currently making.
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.
Posted on 2/9/15 at 10:32 am to Dr RC
while both sides are making good arguments, its pretty naive to think anyone knows how this all will play out, especially since the a la carte model is still in its infancy stages.
however, every year, more and more younger people continue to cut the cord, so in time, adjustments will need to be made.
i see it as having a few large networks (ESPN, CNN, TNT etc) that we will pay a monthly subscription fee and the rest of the bloat networks will be regulated to youtube and make money off of ads.
however, every year, more and more younger people continue to cut the cord, so in time, adjustments will need to be made.
i see it as having a few large networks (ESPN, CNN, TNT etc) that we will pay a monthly subscription fee and the rest of the bloat networks will be regulated to youtube and make money off of ads.
Posted on 2/9/15 at 10:36 am to Dr RC
quote:
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)
I'm simply stating the laws of supply and demand. They would never be able to charge $100/Mo, or anything close, as you said in your earlier post, simply because demand would dry up at those prices. I'm not getting what you don't understand about that point I'm making. It's economics 101.
Their business model is based around offering services through cable providers. If they went a la carte, which is what we're talking about, they would have to develop a new business model.
quote:
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.
None of this has anything to do with my argument, and I think we're getting a little off track.
Simply put, if ESPN went a la carte, they would not be able to charge anything close to $100/Mo.
Posted on 2/9/15 at 10:41 am to Carson123987
No MLB Network. No Golf Channel. No care.
Posted on 2/9/15 at 10:48 am to rintintin
quote:
Their business model is based around offering services through cable providers. If they went a la carte, which is what we're talking about, they would have to develop a new business model.
Again, ESPN CANT do that b/c they wouldnt be able to pay the money they owe to the content providers.
ESPN doesn't want it b/c they are a middle man for sports content providers and need to be have an extremely high subscription rate in order to function. Cable and satellite tv providers don't want it b/c they are the middle man for tv networks. Sports content providers don't want it b/c their enormous profits are heavily based of the exorbitant deals ESPN (and others) pays for the rights to air their product. Athlete players associations (and athletes by extension) don't want it b/c their salaries are now huge due to the revenues generated from TV deals. Disney doesn't want it b/c ESPN is one of their most profitable investments.
Its not just ESPN that has a vested interest against a la carte. Nobody involved in providing the content to us is going to want to go to a la carte b/c its all just one big merry go round of money that would be severely cut into if the model drastically changes.
quote:
Simply put, if ESPN went a la carte, they would not be able to charge anything close to $100/Mo.
again, I never said ESPN by itself would be $100 a month.
the max I put it at was $50.
The $100 would be far ESPN, ESPN2, ESPN3, ESPNU, and SECN as a package.
Also, for many reasons, HBO cannot be compared to ESPN like has been done in this thread. Their business model is not heavily based off of captive audience advertising like ESPN, they do not pay anywhere near the fees ESPN does for the rights to air movies, and they actually create original content that people want to see.
This post was edited on 2/9/15 at 10:58 am
Posted on 2/9/15 at 11:05 am to Dr RC
quote:
Again, ESPN CANT do that b/c they wouldnt be able to pay the money they owe to the content providers.
I agree they won't, but we are talking hypothetically. If they did, hypothetically speaking, no way they could charge even $50 IMO.
Posted on 2/9/15 at 11:08 am to rintintin
quote:
I agree they won't, but we are talking hypothetically. If they did, hypothetically speaking, no way they could charge even $50 IMO.
They would have to or else they could not afford to continue to air content from NFL, NBA, MLB, CFB, MLS etc.
Posted on 2/9/15 at 11:28 am to Dr RC
quote:
I never said ESPN by itself would be $100 a month.
the max I put it at was $50.
The $100 would be far ESPN, ESPN2, ESPN3, ESPNU, and SECN as a package.
Who in the hell would pay for that?
Posted on 2/9/15 at 11:39 am to Dr RC
quote:
They would have to or else they could not afford to continue to air content from NFL, NBA, MLB, CFB, MLS etc.
I think we have a miscommunication. Yes they would NEED to in order to generate the same amount of revenue from subscribers, but my point is the market wouldn't allow them to charge that much. Nobody would subscribe.
Posted on 2/9/15 at 11:51 am to rintintin
and this is why they wont forsake cable to go a la carte.
Posted on 2/9/15 at 11:52 am to Dr RC
Yes I agree. I was never arguing against that.
Posted on 2/9/15 at 11:54 am to rintintin
Well some here seem to think a la carte is coming in the future.
I just dont see them doing it b/c to make what they make they'd have to charge those prices.
I just cant see any other sources of revenue that could make up for loss of cable subscribers.
I just dont see them doing it b/c to make what they make they'd have to charge those prices.
I just cant see any other sources of revenue that could make up for loss of cable subscribers.
This post was edited on 2/9/15 at 11:56 am
Posted on 2/9/15 at 12:06 pm to Dr RC
IMO eventually they will have to. Media is trending more and more that way. I think sports will be one of the last holdouts, but eventually they will follow the market trends. It may take 20 years, but its gonna happen no doubt in my mind.
The last thing ESPN wants is for another player to come along and do it first. From a business standpoint you would have to take the short term hit on the bottom line to be first mover for the long run. There's no media outlet that can touch ESPN when it comes to sports content, but if a new player came along and offered a la carte sports streaming services, they could catch up quickly.
The last thing ESPN wants is for another player to come along and do it first. From a business standpoint you would have to take the short term hit on the bottom line to be first mover for the long run. There's no media outlet that can touch ESPN when it comes to sports content, but if a new player came along and offered a la carte sports streaming services, they could catch up quickly.
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