Comments
clrmoney
11/1/2016 10:41:43 AM
User Rank Platinum
Cut Pay TV
I think that subscribers should find other alternatives besides Pay TV and I know that there are other options elsewhere that are better.
batye
11/2/2016 1:13:46 PM
User Rank Platinum
Re: Cut Pay TV
@clrmoney in small rural areas where is internet still is dial up consumers have no choice...
dmendyk
11/1/2016 10:52:38 AM
User Rank Platinum
Squeeze play
The hide-in-plain-sight nugget here is that nearly 20% of "OTT" users also plan to cut their spending. If that's the case, then it won't be long before we start hearing about OTT services hitting their point of diminishing returns.
Adi
11/1/2016 11:17:25 AM
User Rank Author
Re: Squeeze play
@dmendyk - yes, and without the same scale, bundled broadband subscriptions and annual contracts, OTT providers have far less protection. Plus, wall street is more likely to accept pay-TV providers losing subscribers, but if the major OTT guys started losing subs (net), their stock price would be slaughtered.
dmendyk
11/1/2016 12:03:07 PM
User Rank Platinum
Re: Squeeze play
Also, the cable pay-TV providers have other growing revenue bases -- broadband Internet service and enterprise services. In that sense, a company like Amazon or Google has strong portfolio diversity to weather the inevitable OTT plateauing, unlike, say, a company like Netflix.
afwriter
11/1/2016 1:16:33 PM
User Rank Platinum
Re: Squeeze play
I feel like Netflix is starting to enter that territory where they were the first, but people built a better product from their design and now they are starting to be out dated. I don't think Netflix will fall apart tomorrow, but they may be in danger in a few years if something doesn't change.
batye
11/2/2016 1:15:41 PM
User Rank Platinum
Re: Squeeze play
@afwriter yes, you are right as I do see the same trend - netflix getting affected by smaller players... and Amazon :)
dlr5288
11/30/2016 7:25:36 PM
User Rank Platinum
Re: Squeeze play
I agree! Although I still see Netflix hanging on for a while still. And I hope so because I'm kind of addicted..
afwriter
11/1/2016 1:22:23 PM
User Rank Platinum
Other options
There are so many other options out there that people are starting to realize that they don't need pay-TV any more. A few things that come to mind are better over-the-air television, Amazon and Vudu season passes, and even apps that allow for streaming shows.
DHagar
11/1/2016 8:58:25 PM
User Rank Platinum
Re: Other options
@afwriter, and those choices are providing better value. Subscribers are not willing to subscribe to a package of meaningless programs when they can get scores/news in other formats. And the streaming movies and entertainment are becoming a preferred venue.
Cable companies are going to have to compete with the content providers and better packages, ie Amazon, etc.
Adi
11/2/2016 12:18:13 PM
User Rank Author
Re: Other options
@Dhagar - That's an interesting observation in the context of new slimmed down TV packages being offered, such as Sling TV and PlayStation Vue. And we've got operators offering the same, with Comcast's Stream, DirectTV Now which is scheduled to launch shortly and Cablevision's rather bluntly titled cord-cutter package, offering broadcast channels and an antenna.
DHagar
11/2/2016 2:43:10 PM
User Rank Platinum
Re: Other options
@Adi, interesting - thanks for information. It makes one believe that you either become a "commodity" with a least costly package or a "value-added" provider with desired and/or exclusive content.
batye
11/2/2016 1:12:20 PM
User Rank Platinum
Re: Other options
@afwriter yes, you are right as this day consumers getting more options to cut the cord... easy... as long as they have good internet speed/access :)
mhhf1ve
11/3/2016 2:53:59 PM
User Rank Platinum
stats...
> "pay-TV subscribers watch considerably more TV than OTT subscribers.."
I wonder how accurate these stats really are.. I'm sure pay-TV subscribers have their TVs playing in a living room while they're not really paying attention to it for many more hours, and OTT subscribers are more attentively watching the videos they consume. Not sure how this situation might be reflected in the stats, but I doubt many people watching OTT videos on their smartphones are walking out of the room while their videos are playing to no one....
Michelle
11/7/2016 10:03:03 PM
User Rank Platinum
Re: stats...
@mhh you bring up a really interesting tracking issue. I assume they use a formula to account for some of these viewers --
mhhf1ve
11/8/2016 9:03:20 AM
User Rank Platinum
Re: stats...
The old marketing quip is still true:"I know I'm wasting half of my ad budget, but I don't know which half."
Re: stats...
@mhh: I'm certainly familiar with that old bromide, but your mention of it got me thinking.
In theory, it could be argued that A/B testing over time could potentially make your marketing spend more efficient if you randomly cut half of your marketing budget, saw how that did for a while, compare, and then re-cut your budget and successively add back what you cut in on the last round. Rinse and repeat -- and, with the insights gained after a few rounds, begin making permanent cuts once you've found that certain things are valuable while certain other things are worthless. This would, over time, gradually bring your marketing spend to 99.x% efficiency.
But, alas, that's not how the real world of marketing works. Non-marketers don't understand that steady, moderate spend is what keeps you competitive; slashing the marketing budget to shreds once you're stablized will set you back a ton -- and then attempting to fix that by overcompensating and octupling the previous marketing budget will simply lead to inefficiency and waste.
Still, A/B testing (used in proper scope) can be very valuable -- and I expect the providers to be playing around with incentives, content types, delivery methods, and other miscellany a lot more in the nearish future.
mhhf1ve
11/8/2016 7:12:17 PM
User Rank Platinum
Re: stats...
Joe, that's an great idea... except it'd be hard to really implement with all the variables that change in real life. Marketing campaigns are usually pretty time-sensitive, so unless you can perform all of the necessary A/B test nearly simultaneously, you wouldn't be able to control for the time variable that changes your competitors campaigns and other time-dependent factors. And then, even if you could try to do it all at once, whatever you learned might not apply to the next campaign....
I'm sure you'd probably learn a few things about what works, but you can never quite get all the answers to optimize your ad budget forever....
mhhf1ve
11/3/2016 2:59:16 PM
User Rank Platinum
predictions...
> "..we will see cord-cutting and cord-shaving ramp up, but it's not very likely that 41% of pay-TV subscribers will slash their bills.."
Internet and pay-TV bundles are so intertwined now that I doubt users will be able to "slash" much of their bills unless they want to start paying more for data that "exceeds" their broadband data cap.
Bundling services is a pretty good way to stop users from completely cutting off parts of their bills. It's also part of the reason why zero rating is so insidious....
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