To Subscribe Or Not To Subscribe, That Is The Question: Paid Streaming Services

[ganesh]

Me too. I actually was going to cancel my cable and they ended up giving me the newcomer rate for cable, internet, with free HBO. 

[The Crazed Spruce]

This article I found says just for Shaw and Rogers customers without mentioning anything about beta phase:

 

http://globalnews.ca/news/1527031/rogers-shaw-launch-shomi-video-streaming-service/

 

Not that it means it is true, but Global is owned by Shaw so you would hope they could get their facts straight.

Well, if you actually go to the site, it says "Currently available in limited beta release to Rogers and Shaw internet and cable customers".  I figured that implies that it'll eventually be available to other providers.

[AntiBeeSpray]

Me too. I actually was going to cancel my cable and they ended up giving me the newcomer rate for cable, internet, with free HBO. 

 

If you don't mind me asking, who are you going through, provider wise?

[JTMacc99]

It's already nearing that point for me tbh. I already pay over $100 for tv and internet bundled (UVerse). And every so often they try to raise the prices some more. They're really, really pushing it imo.

if you tear apart the financials for UVerse, you will see fairly normal increases in what it costs them to run most of their business. Employee costs go up 3%. Operating costs go up 3%.  SG&A including Marketing swing in a range around that number. They spend a bunch of money on capital improvements, which is the cost of running all that fiber all the way out to homes and building the stuff they need to keep internet speeds and video delivery up to par.  And then you would see that the content costs, or programming, goes up at significantly more than 3% per subscriber every year.  If they break out what they pay just for the over the air broadcasters, that number would probably be going up 20% per year for several years.  And that's the majority of what drives the non-stop increases to our bills. 

 

As Kel Varnsen pointed out above, if the current model breaks under it's own constant pressure of increases and we'll all probably still end up wanting the content, we will just send the checks to different places than we do now.  If a person can be happy breaking free from the monthly cable bundle with the streaming services available, it is a hell of a saving right now.  But what I see is that once enough people bail out of the current model, the people who make TV are still going to figure out a way to make sure they collect all of that money they've lost.  Which would probably mean they'll charge significantly higher amounts to the streaming services for their TV shows, which means the streaming services will charge customers significantly higher amounts per month. 

 

But right now, there's a pretty good value to be had from streaming services.

[ganesh]

I have xfinity. I actually don't have a cable box/tv. I have a card that plugs into my computer via usb. I rarely watch tv live. Xfinity has almost all the current shows online the day after, and I watch through my browser/phone. I also watch soccer and HBO on the phone via their apps too. You have to log in with the xfinity ID. 

 

It's not bad, but I don't watch more than 7 channels total I think. 

[Wax Lion]

Interesting. Hulu's banner is announcing that its got Califonication for subscribers ad-free. More and more I'm getting the impression Hulu's trying to make sure it won't suddenly become irrelevant if the broadcasters suddenly decided to put more restrictions on their programs (I'm pretty sure the five-episode limit was new last year).

[JTMacc99]

So... Nielsen is reporting that they will start measuring the major streaming services like Netflix and Amazon.  At the moment, they are only planning to report back the numbers to the content owners for their own specific content.  So for the first time, major media companies like Disney/ABC will have an understanding of how many people, and what kind of people, are watching the shows they sell to Netflix.  Netfilx does not share that data.
 
Here is the quote from the article I read: “The bad news is, it’s another confirmation point of our worse fears of a secular decline in ad-supported TV,” Bernstein analysts said in a research note. “The good news is, maybe this will help wake up the media companies and shake them out of denial. They can reverse, or at least mitigate, the trend they started when they allowed the SVOD value proposition to get out of line.” In addition, the reported move seemed to “confirm our fears that SVOD is directly cannibalizing ad-supported TV consumption,” the analysts said.
 
I highlighted the bad news for us, although it is good news according to the analyst, so this must have been written from the perspective of somebody worried about the media companies which are dominated by Newscorp, Viacom, Disney, Time Warner (not the cable part), CBS, NBC/Comcast.  What that little bold section means to me is that SVOD (subscription video on demand) gives people tons of value for very little cost, and when the big media companies get armed with data, they are going to significantly change the "very little cost" part.

Edited November 20, 2014 by JTMacc99

[Kel Varnsen]

So... Nielsen is reporting that they will start measuring the major streaming services like Netflix and Amazon.  At the moment, they are only planning to report back the numbers to the content owners for their own specific content.  So for the first time, major media companies like Disney/ABC will have an understanding of how many people, and what kind of people, are watching the shows they sell to Netflix.  Netfilx does not share that data.

How has netflix gotten away with not sharing that data. I mean I would think that would be a huge point in negotiations. If say ABC/Disney wants to licence Grey's Anatomy to Netflix, wouldn't knowing how many people are watching Grey's Anatomy on netflix be a huge component of figuring out how much ABC is going to charge netflix for the show?

 

And I have often wondered how long Netflix can continue to expand their offerings (adding more shows and developing their own shows) before they have to start increasing their price. I mean is their growth in subscribers keeping up with their expansion. Plus even if it is working now, developing shows is crazy expensive. Only doing 1 or 2 a year can kind of reduce that (since you can cherry pick the best scripts). But what happens when some of the shows start failing? I mean it is not like HBO or AMC only ever produced awesome original series. 

Edited November 20, 2014 by Kel Varnsen

[JTMacc99]

How has netflix gotten away with not sharing that data. I mean I would think that would be a huge point in negotiations. If say ABC/Disney wants to licence Grey's Anatomy to Netflix, wouldn't knowing how many people are watching Grey's Anatomy on netflix be a huge component of figuring out how much ABC is going to charge netflix for the show?

Heh. I was in the room when one of the people who does exactly that job for one of the Media companies talked about it. The answer to your question was, "Since I don't really have any data to work with, I just took the number from last time and made it a lot bigger."

 

Netflix gets away with it for a couple reasons. First, think about how they established this streaming business. They built a library of old stuff and some interesting new stuff that was earning media companies virtually nothing sitting around in their basements. When the owner of old "Wings" episodes finds out that they could make a few bucks by selling it to Netflix, it was way better than earning no bucks. And Netflix was able to build a hell of a business with a lot of their content coming that way, and they didn't require any advertising to make it work. 

 

As Netflix got bigger and more popular, they are still able to make a go of it without running advertisements over the content.  And without advertising, there is absolutely no revenue generating reason for them to share ratings or viewing habits with anybody. Recently the content owners have started just "charging a lot more" as I noted above, but as long as Netflix has their own numbers, they can evaluate which ones are worth the arbitrary price hikes and which ones they can tell Disney/ABC they don't want at that price.

 

Another bit of pure speculation from me: If this Neilsen data ends up taking away Netflix's competitive advantage in negotiating, a really big barrier has been removed from them selling advertising.  In other words, if Neilsen is going to tell the media companies how many people are watching their programs on Netflix, which translates to higher content cost for Netlix, it is not at all unreasonable to think that Netflix will start selling advertising to pay for that new content cost as opposed to raising the per month subscription fees to cover the entire amount.

[Wax Lion]

I don't know what's going on here. I went to watch Girlfriend's Guide to Divorce on Comcast's website and the episode had a Bravo watermark on one corner and a Hulu watermark in the other. I noticed the ads looked like Hulu ads, too with the "Is this ad relevant to you" bit in the top corner. During an ad break, I went to look at Hulu's GGtD page to see if the show was there and it showed I had partially watched the episode I was watching as well as an indicator of how long my ad break would run.

 

Interestingly when I tried to see if I could connect my Hulu to my Comcast account, Comcast still doesn't support it.

 

So... I guess Bravo is using Hulu's video player for GGtD? I think that's promising because Hulu has a lot of features I like... but most of them weren't there, like the ability to jump back 10 seconds or the tiny preview window that makes it easy to find a scene.

[ApathyMonger]

One thing I don't like with Hulu is that there's no real reliable way of knowing when they've added stuff that isn't recently aired. They have their "new shows" page, but that doesn't tell you when old shows have been updated.

 

For instance, S2 of the very enjoyable UK show Some Girls was just added. I would have no idea, except that I specifically checked the show page because I knew it had been about a year since they added S1.

 

If it had been on Netflix, there's services like InstantWatcher and NewOnNetflixUS, but I don't think there's any equivalent for Hulu.

[JTMacc99]

Another little article about Netflix and some high level stuff about why they need to keep cranking out their own content.

[roseha]

I would subscribe to the CBS service/app, or at least consider it, but I will not give them my name and date of birth.  That is just the ultimate of arrogance on their part with identity theft running rampant everywhere.  Just have a box saying "I am over 18" and leave it at that CBS.

[Moose135]

Do you need to give them your real name and DOB, roseha?  I have any number of fake names I would use for stuff like that, plus an old Juno.com e-mail that I only use when I don't care who has it.

Edited January 8, 2015 by Moose135

[roseha]

Do you need to give them your real name and DOB, roseha?  I have any number of fake names I would use for stuff like that, plus an old Juno.com e-mail that I only use when I don't care who has it.

Well, yes I have faked my DOB occasionally, for instance for the Microsoft apps on my former Nokia cell phone, but it's just an irritating practice.  CBS should know better. 

Edited January 9, 2015 by roseha

[Chicken Wing]

Welp, Comcast decided to hike my triple play package up $80 from the price I've been paying for the past six years, without warning or explanation. I gave them quite the earful the other day after I got the bill notification - not that they give a crap. I know I can get them to offer me a deal, but it won't come close to what I was paying before. I've thought about cord-cutting for a while and I'm thinking this might finally be the time to do it. I already have Netflix and Amazon Prime, and I hardly ever use either since I just mindlessly watch whatever's on TV. But when I really think about it, I'm not really watching anything - the TV's just on. I think I watch all of four current primetime shows and the rest of the time I'm just background-noising reruns of stuff. If I did cut the cord, I'm thinking of getting a Hulu Plus subscription to get access to more shows and to be able to watch my current network shows the next day. I guess I could also buy a digital antenna to pick up the broadcast networks that way and still watch some stuff live. Oy, I don't know. The service period for the new gigantic price starts next weekend, so I need to make a decision soon. I don't like decisions. I want to crawl under the covers and wait for life to do everything for me. Blergh.

Edited January 10, 2015 by Chicken Wing

[kassygreene]

Ah, Comcast.  They just hiked up our bill for no reason I can tell, and their online account information is so screwed up that the Your Account page says we are being billed at a rate that we last saw two years ago, that each of the two free digital adapters we have are being billed at $0.00, and also each at $4.95, and every upgrade package we are eligible for expired December 8 2014.

 

I've noted before, one year of Amazon Prime + one year of Hulu Plus + one year of Netflix is less than two months of Comcast, and one year of CBS Access + one year of HBO Go would still be less than another two months of Comcast.  All we need is internet and an internet compatible television (which is less than three months of Comcast).

[TeslaNewton]

You don't necessarily need an Internet-capable television. A streaming device would work -- Roku, AppleTZ, even a Wii or X-box 360 (and X-box One), plus many other devices.

Edited January 11, 2015 by TeslaNewton

[Kromm]

I would subscribe to the CBS service/app, or at least consider it, but I will not give them my name and date of birth.  That is just the ultimate of arrogance on their part with identity theft running rampant everywhere.  Just have a box saying "I am over 18" and leave it at that CBS.

Wait... I don't get it.  You have to PAY them.  So how are you going to avoid telling them who you are?

I suppose the best you could do is if they accept Paypal (but then Paypal still knows who you are).

[seamusk]

I somehow missed that there is a cable-free subscription that Dish TV is doing called Sling TV (not to be confused with slingbox). It's $20 per month though which I think is a bit high, but it's a small package of channels including ESPN.  I think the inclusion of ESPN is huge.  For a lot of people, the sports issue is a big one.  For example, the college football playoff games are only on ESPN.

 

I'm ready for HBO Go though.  That's what I want more than anything.

[Kel Varnsen]

You don't necessarily need an Internet-capable television. A streaming device would work -- Roku, AppleTZ, even a Wii or X-box 360 (and X-box One), plus many other devices.

Even most DVD/Blu-ray players have a few internet TV options. My sony blu-ray player has a bunch and that was so cheap we got it free using frequent shopper points at our local drug store 4 years ago. It gives us netflix, youtube, crackle and a few other really crappy channels. Every once and awhile I will change the DNS settings so it looks like we are in the US and it gives options for a bunch of other channels at that point like Amazon Instant Video, Hulu Plus and a few more. 

[TeslaNewton]

Yeah, the options are almost limitless.

[roseha]

Wait... I don't get it.  You have to PAY them.  So how are you going to avoid telling them who you are?

I suppose the best you could do is if they accept Paypal (but then Paypal still knows who you are).

It's not an issue of paying them with my name and address on my PC.  Every company I purchase anything  from knows my name, address, cc number, but I mean the CBS service for Roku and Ipad. Over Roku it's only offering clips (I have checked).   On Itunes  It's initally offered as  free but it wants my name and DOB on the tablet to start or it blocks me.  I don't put that info on an app, I am not convinced that a tablet is that secure.  I would potentially pay for it over my computer in the usual manner (though I still don't see a reason for giving out one's DOB) but I haven't seen that advertised yet.

Edited January 14, 2015 by roseha

[Kel Varnsen]

It's not an issue of paying them with my name and address on my PC.  Every company I purchase anything  from knows my name, address, cc number, but I mean the CBS service for Roku and Ipad. Over Roku it's only offering clips (I have checked).   On Itunes  It's initally offered as  free but it wants my name and DOB on the tablet to start or it blocks me.  I don't put that info on an app, I am not convinced that a tablet is that secure.  I would potentially pay for it over my computer in the usual manner (though I still don't see a reason for giving out one's DOB) but I haven't seen that advertised yet.

Do you have to tell the truth? Most beer websites ask you for your age before they allow you to enter. And most of them believe my date of birth is January 1st, 1901. 

[JTMacc99]

HBO made the official announcement yesterday that it will be available outside of the traditional cable package for $14.99. As of right now it is available through Apple, and I guess they are working on other platforms.

 

What does everybody think?

[FormerMod-a1]

Per month?  Can you pay month by month?  If so, it might be worth it, but if you need to buy a year at a time I'll decline.

[JTMacc99]

I am pretty sure this will be set up to be month to month and paid to Apple the same way we pay for songs or anything else in iTunes.

 

Seems like you could just wait until June, pay your $15 and watch the whole Game of Thrones season that has already run in April - May and catch the last couple in June with everybody else.  Then cancel.

 

I'm not sure how that works for HBO other than it might help them collect a few bucks from the group of people who had a plan for watching the whole season with no intention of paying at all.

Edited March 10, 2015 by JTMacc99

[SunnyBeBe]

I'm trying to educate myself on all the various options before making my next move.  I'm confused.  I wish there was some kind of a Quiz you could take that takes into account the type of shows, movies and features you like and then tells you what is best for you for the money.  lol  

 

I downsized with Time Warner Cable in Jan.  the price is down, but I still feel like I"m being robbed, since I'm now paying the same thing I was paying a couple of years ago for tv, internet, PHONE and DVR.  Now only have cable and internet, No premium channels and no DVR.  

 

I just heard good things about Roku, but I don't know enough about it yet.  Netflix sounds good too, so I'm undecided as to how many sources do I need.  

 

I did buy a Rabbit TV device for one dollar! lol  I know. I think it's just a device that directs you to various sites where you can watch streaming.  Still, as long as it is safe, it might be of some benefit.  

 

Can someone tell me if you use Netflix or HULA, do you have buffering issues?  I have that problem when viewing A&E site.  

[ABay]

I used to have buffering issues with Netflix, which I access through a blu-ray player, but it was because my wireless router was an antique. Since I got a new one, everything is fine. Ooh. Except if I'm in my bedroom watching on the Kindle, it has gone to buffering once or twice. It's the room farthest away from the router.

 

I've considered a Roku but both HDMI slots on the TV are already occupied.

[seamusk]

Either a Roku or Apple Tv works well. I prefer the interface on the apple tv, but both are fine. And just give you an interface to access netflix, hulu, etc... directly on your tv. I also get HBO Now because I love hbo television and their selection of movies. I've been able to strip down to just internet and the only main issue I have is the occasional live sporting event. The NHL playoffs were hit or miss as to my ability to stream them. 

[DittyDotDot]

I have a Netflix account and it works fine for me, no buffering issues. I mostly have Netflix so I can get things via disk beings as my internet connection isn't unlimited and streaming uses a lot of my data allowance (I live in a very rural area). The issue with Netflix is not everything is available for streaming and TV shows aren't available at the time the show is airing but some time after the season is over. And some shows don't get released for streaming till the next season starts. It doesn't bother me, but if you want to be active in those forums you may find it frustrating.

 

I also use Hulu, but not Hulu Plus. There's quite a few shows available free on Hulu, but many of them are delayed viewing--some only a day, some a week and SyFy has this weird habit of putting up the first episode immediately then all other episodes are a month delayed. Again, depends on how timely you prefer to watch these shows. Someone with Hulu Plus might be better able to chime in on availability.

 

Also, Amazon Prime can be a good option to keep current on a show, but again not everything is available. I don't have Prime myself, but have purchased a few episodes from Amazon of something I missed or couldn't find anywhere else and the service worked fine for me.

 

I don't have any issues with buffering from any of these sites, myself, but some of that kinda depends on your internet connection, too. Many cable networks are setting up their own streaming services so they aren't releasing their shows to be streamed on other platforms till after the season is done airing or at all. I have no knowledge of what's available with Roku or Apple TV, though, they sound like they could be good options.

 

Hope this is helpful.

Edited May 26, 2015 by DittyDotDot

[SunnyBeBe]

You have been so helpful.  I have a lot to consider. 

[Rick Kitchen]

Can somebody educate me on Roku?  What is it, exactly?

[Chaos Theory]

Can somebody educate me on Roku? What is it, exactly?

Roku is a device that allows you to stream services like Netflix, Amazon Prime and Hulu on your TV. If you have consoles like Xbox and playstation they work the same way but I think Roku is designed for the purpose of streaming so the features may be different. I have Xbox360 so I do not need A Roku. I don't know enough about it to know if it will work for HBO Go or the current crop of channels that are starting to offer pay streaming on their sites.

Or you can stream on a computer/laptop.

Edited May 28, 2015 by Chaos Theory

[ParadoxLost]

I am so uneducated on all this stuff.  I just bought a Smart TV so I wouldn't need to worry about it.

[Wax Lion]

The Roku is a device for connecting streaming services to your TV, so instead of watching Unbreakable Kimmy Schmidt on your computer you can watch it on the same set you watched 30 Rock.

 

I used to access Netflix and Hulu via my Xbox 360 but the traffic goes through the Xbox Live servers (at least it did last I used it) so if Xbox Live is having problems, I couldn't use Netflix even if Netflix was fine. However, the Xbox otherwise works great for playing games and watching streaming TV.

 

It's worth noting that Roku is the only independent streaming box. The Kindle, Google and Apple equivalents try to keep you to buy from their sister companies but Roku has a more open way of creating "channels." That makes the number of Roku channels overwhelming (though you can find the major stuff) but it also means your local news might have a channel for streaming stories.

 

One nice feature of the Roku 3, you can plug headphones into the remote which turns off the sound and pumps them into the headphones, great for watching TV while the rest of the household is asleep.

 

However, one channel the Roku doesn't have is one that lets you stream VOD content from Comcast. Comcast has been resisting the Roku, it took them a while to allow the Roku to access HBO Go.

 

I hope that's helpful.

[mansonlamps]

I have an Amazon Fire and a Roku and I much prefer the Roku. The Amazon Fire has a fantastic voice search, but that's the only feature I prefer on that device. What I love about Roku is that you search for your show and it gives you all the available options for streaming complete with the pricing all with one click. Amazon, as mentioned above, steers you toward Amazon Prime videos and you have to click "more ways to watch" for additional options. Even then it doesn't even show you if your show is available with Netflix at all without specifically searching through the Netflix App which really pisses me off. I have no buffering issues with either device.

[ABay]

Those with Roku: Have you noticed any problems with Roku 3 v. Roku 2?

[JTMacc99]

Roku 2 and Roku stick owner here and they function very similarly. Roku has a Time Warner app that let me get rid of a couple boxes.

[GHScorpiosRule]

I have the ability to watch Netflix, Hulu, Amazon Instant Video via my bluray.

 

Maybe this isn't the right place to mention this, but since it does pertain to Netflix, I'll put it here.  I'll never understand why, when older shows are available for streaming on Netflix, why the producers, company, corporation, or whoever agrees to let the shows be streamed, won't provide ALL the episodes of a show.

 

For example, I just discovered last week, that Quantum Leap was available. I was so excited! To see the unedited, full episodes! But nope. Although all five seasons are there, they are not complete.  The first season, which was a short on (9 episodes), doesn't have the pilot (two parter); second season is missing two episodes; the third season, 7! And the fourth and fifth season, five episodes.  And they're not the most controversial; they're all very random. When I called Netflix, they told me it was "a licensing issue", that for whatever reason, TPTB didn't want Netflix to be able to stream them.  Two, or rather, three of them, are the final season's premiere and series finale.

 

And I'm not about to pay $2 to watch them on Amazon, for fork over $8 if Hulu does carry it, to watch them. I'm going to see if I can find them on youtube or something.

[Jaded]

It's probably a music licensing issue.

[Chaos Theory]

I've noticed that too. A bunch of older shows like Roseanne are billed by Netflix as "Collections". Not so old shows like Intervention does this as well. Intervention has I think a dozen episodes which includes a follow up episode from an episode they don't have. Collection shows are really weird and counterproductive.

Edited June 1, 2015 by Chaos Theory

[DittyDotDot]

It's totally a licensing problem--usually due to music in that episode or some other branding issue--and since they aired before this advent of streaming, those rights weren't procured when they got the rights to use those things originally. If they aren't licensed for Netflix, I doubt you'd find them licensed for Hulu. Of course YouTube is a whole different ball game.

[GHScorpiosRule]

Well, FUCK.

 

It's not really a HUGE issue, as Cozi is currently airing the show. And I also plan on buying them on DVD when I have some moolah saved up. Because Bakula as Sam Beckett is BEYOND ADORABLE and I just loved how he played being a woman.

 

I wonder if they changed the music on the DVDS? Because I know that when Beverly Hills, 90210 was released, the original music wasn't on some episodes or some such.

[Chaos Theory]

Well now the Hannibal has come to an end I want to watch it from the beginning. Add it to Definace and The Americans as reasons to consider Amazon Prime.

[Shannon L.]

We started using Amazon Prime near the beginning of this year.  A couple of days ago, I finished Season 3 of Grimm and, since it was a pretty exciting finale, I rushed right to the first episode of Season 4 (Season 5 is due to start at the end of October) only to find out that it's not free!!  Does anyone have any idea how long it might take for them to make it free for Prime members?  I googled it, but, of course, nothing came up on the Amazon website because I'm sure that they'd prefer we give them our money  :)

[DittyDotDot]

I think it depends on the show and the streaming service, but usually most shows are not free to stream with most services until the next season starts. They usually become free when the DVDs are released. Some shows are never free to stream though. I don't know about Grimm in particular, but I would expect you would have to pay for the individual episodes or a season pass if you want to watch it "live", so to speak.

ETA: However, NBC usually puts their shows up on their website--and sometimes on Hulu--a day after they air and usually are available to watch for free until the next one airs. Again, not sure of Grimm in particular as I stopped watching it sometime in S2.

Edited September 25, 2015 by DittyDotDot

[Shannon L.]

Thanks, DittyDot!  I guess at worst I have 6 weeks, at best 2 weeks (give or take a few days) to wait.  *sigh*  DVRs, streaming and dvds have made me very impatient  :) 

[yourpointis]

Cost Cuts Won't Solve ESPN's Biggest Problem

 

ESPN is axing 200-300 jobs, but it still won't solve its biggest problem.

When it comes to cable bills, there's probably no better posterchild for increased costs than The Walt Disney Company's (NYSE:DIS) ESPN. As a direct beneficiary of America's increasing love of sport over the last decade or so, the network has been able to essentially raise prices at will. In a bout of irony, the company may have been too effective at raising the costs of their content.

More recently, as a result of content cost increases across the board, many subscribers are looking to cut or shave the cord. Regardless of whether the user is looking to go without cable entirely or merely to trade down to smaller packages, ESPN's high-cost host of networks are mostly included. Earlier this year, cable-analytics firm Nielsen (h/t The Wall Street Journal) found Disney lost 7.2% of its subscriber base in the last four years, and a massive 3.2 million, or 3.3%, in a little over a year as many subscribers are looking to save money.

As a result, the company has had to adjust to lower subscriber numbers. And if the newest report from The Big Lead is correct, ESPN is looking to lay off 200-300 employees in the upcoming months to cut costs. In the end, however, the company is still not addressing the elephant in the room.

 

ESPN is playing small ball with costs
Following on the heels of parting with big names as far as online talent -- controversial commentators Keith Olbermann, Colin Cowherd, and Bill Simmons were recently released -- ESPN appears to be focusing on cuts in order to trim $100 million from the 2016 budget and $250 million from the 2017 budget, The Big Lead reported. While that seems like an aggressive number, and perhaps it is from an operational standpoint, ESPN is playing small ball with costs because, quite frankly, it has to.

For a comparison, last year ESPN's new contract with the NFL kicked in, ESPN now pays the league $1.9 billion per year for the content, as opposed to $1.1 billion in the prior contract, a 73% increase. While these contracts are negotiated in seven-year increments, it still amounts to an 8% annualized increase. For the upcoming year, the contract with the NBA brings ESPN's content costs from $485 million to $1.47 billion, a near $1 billion price increase on a yearly basis. In the end, $100 million-$250 million is small ball (pun shamelessly intended) in the scope of the content cost increases.

 

There's four ways to pay for these added costs
As a business, there are four main ways to handle increased costs: ESPN can grow subscribers, monetize the content more effectively, cut costs to offset the content price increases, or become a less profitable entity. The first option is decidedly off the table, mainly as a result of the company's already aggressive monetization through increased carriage fees that total $6.61 per user -- making it, by far, the most expensive cable channel.

The second option is simply not increasing carriage fees, even though cable television monetizes viewers in two distinct ways: carriage fees and advertising. Unfortunately, traditional television advertising is experiencing a growth slowdown as more marketers shift ad spend to digital and mobile channels, and it seems ESPN has gotten more serious about its digital presence by recently updating their website for the first time in half a decade. But, in the end, any growth in the digital realm for ESPN will be unlikely to offset the large amount of the content cost increase.

In order to avoid the final option, as investors really don't like investments to become less profitable, the company has also decided to cut non-content related operational costs and 200-300 jobs to make up for increased league fees that will go to players and owners. So while NBA players and fans will be tuning in to ESPN to find out the newest eye-popping contract, you can bet the announcement will be somewhat bittersweet for the team of production assistants, writers, editors, and even on-air talent that lost a talented co-worker as a result thereof.

 

[revbfc]

I tried SlingTV for a two week trial and was not impressed. It's only $20 p/mo, but it's so glitchy. Every five minutes the feed freezes or the whole thing crashes my Roku (I have the brand new R4). One could blame it on my connection, but I stream HD (live TV) from lots of other companies and these glitches are special to SlingTV. It's really too bad, because I love idea of SlingTV.

On a related note: Is there anyone here that used to subscribe to the old Starz internet only service from ten years ago? How about the awful AT&T internet TV thing from 8 years ago?