Cablevision Enters into Interim Agreement Regarding VOOM
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I do think the market for satellite TV has changed since D* and even E* entered the picture. Cable really sucked then (and most of it still does, but they have tried to get better - Brighthouse in Central Florida has a pretty good offering of all local channels and some national channels) and thus D* and E* had a great alternative to cable. It was a kind of new technology that previously was only available if you had a huge dish in your backyard. The small dish opened up a new market with lots more channels and "digital" transmission. Obviously some 23 or so million agreed. I think it is harder to penetrate this market now. Cable has tried to step up to the plate and improve its service and offerings and that makes the competition even tougher. While V* offers something the others have a limited amount of (HDTV), given the limited number of HDers out there now, it is a much tougher market to crack. When D* and E* came out, all you needed was a regular TV to fully enjoy the service. V* sort of requires a HDTV to fully enjoy the service. And when D* eventually adds additional HD, it will create even more competition.
Thus, V* is great but they face a tougher market than D* did.
BTW, does anyone know the subscriber numbers for D* in its first 2 years of service?
Thus, V* is great but they face a tougher market than D* did.
BTW, does anyone know the subscriber numbers for D* in its first 2 years of service?
It's like some of these guys claim to know more about the satellite market than billionaire Chuck Dolan. They post their business advice here, then put their hat back on and then go back to delivering pizzas.
dlm10541 said:I wish I had said that
Well, I did say it
in another thread but not nearly as eloquent!
Here is a grear piece on HDTVs and probably why Voom never cought on:
I was in an office supply store picking up printer paper when I saw a 19-inch color TV with a built-in VCR and a built-in DVD player. The price was $149! That’s about what it costs for two couples to go to a modest restaurant in Connecticut and maybe have one “house” wine each with dinner. A recent newspaper story reported on 20-inch TVs on sale in grocery stores for $79. This is crazy!
A January 5, 2005 article in the Wall Street Journal, “Why HDTV Hasn’t Arrived In Many Homes,” had statistics on U.S. sales of analog color TV receivers compared with digital television receivers. A bar graph based on data from the Consumer Electronics Association gave the numbers. The bar graph indicated that roughly 35 million television sets were sold in the U.S. in 2004. Of these, roughly 7 million were digital. The annual sales rate of analog television receivers is four times as large as for digital TV sales.
We can play with these numbers a bit. If we project that the total number of TV sets sold in the U.S. will remain at 35 million units a year, and that the unit sale of digital TV sets will increase by 50 percent each year, it won’t be until some time in 2007 that more digital sets will be sold in a year than analog sets. Increases of 50 percent are easy in the early years when the base number is small, but become much more difficult when the numbers are large. So 2007 is optimistic. Using these optimistic figures, essentially all the sets sold in 2008 will be digital. But between 2005 and the end of 2008, 85 million more analog sets will have been sold against only 55 million more digital sets. Because an analog color TV functions for at least a dozen years, these receivers are filling several rooms in the average household. I’ve seen statistics indicating a current population of over 300 million color TV receivers in the U.S. (plus a huge number of VCRs). It will be a very long time before most TV sets in homes are digital.
A lot of digital set-top box adapters will be needed. But they will likely cost more than a new analog television receiver for a long time. I recall the consumer electronics industry making a huge fuss over the evil cable set-top boxes and how they would cripple the features of the consumer’s television set. As this transition to digital broadcasting continues, the number of non-cable set-top boxes will have to explode.
We hear a clamor from the government to shut down analog TV broadcasts. If indeed the analog broadcasts are going to be shut down, isn’t there a responsibility to advise buyers of these analog receivers of the imminent obsolescence of their purchases? While the price of these products is not a major dent in the income of most of the readers of this column, those price points impact many less advantaged folks. And any large-scale scrapping of analog TV receivers represents an environmental issue. An interesting public policy question, to say nothing of the moral issue, concerns who is responsible for ensuring consumers are making informed choices when purchasing these analog products. Should the responsibility lie on the shoulders of those selling the products? In that scenario, selling an analog TV receiver without a warning on the day before the shut-down of analog transmission could be considered a dishonest and exploitive act. Is it still fraud a month before? How about a year before? When does it become a moral responsibility that a product offered for sale is actually usable? One might argue that because the government is the entity shutting down the analog broadcasts and making those new receivers useless, maybe the government should be informing the general public of the hazards in buying analog TV receivers.
Another aspect of this issue involves the ideals of democracy. Consumers are clearly voting with their dollars. They are choosing analog TV receivers because they feel they are getting the best value for the price. It is hard to believe that the majority of buyers don’t know about digital consumer products in general, and digital television in particular. But do they know or believe an analog shut-down is coming? They certainly know about digital music and would likely be biased in favor of anything digital if given the choice compared to an analog implementation. In spite of this, they continue to choose analog television receivers by a wide margin. The government is telling these citizens that it knows better than they, and it is willing to force a course of action rejected by the majority. Just ask your elderly aunt what she thinks of this. Mine has told me!
This is another misapplication of the principle of eminent domain. There has been a lot in the press lately about local government confiscating the property of citizens by condemnation so that it could be used for a “higher purpose.” Originally, this was done only rarely to build roads, schools, or other public works having few or no other possible locations. The practice became abusive when local governments condemned property to sell it to developers who would construct facilities generating greater tax revenue. A similar action is taking place here. The usefulness of color TV receivers will be taken so that the spectrum used can be auctioned to generate revenue for the government. Yes, there will be some allocation of spectrum for public safety. But the majority of spectrum will simply bring in more money in a lump sum for the politicians to spend as they like.
Maybe consumers themselves should decide–via their purchases and retirement of analog receivers–when analog broadcasts are no longer needed. Maybe it shouldn’t be a cram-down.
I was in an office supply store picking up printer paper when I saw a 19-inch color TV with a built-in VCR and a built-in DVD player. The price was $149! That’s about what it costs for two couples to go to a modest restaurant in Connecticut and maybe have one “house” wine each with dinner. A recent newspaper story reported on 20-inch TVs on sale in grocery stores for $79. This is crazy!
A January 5, 2005 article in the Wall Street Journal, “Why HDTV Hasn’t Arrived In Many Homes,” had statistics on U.S. sales of analog color TV receivers compared with digital television receivers. A bar graph based on data from the Consumer Electronics Association gave the numbers. The bar graph indicated that roughly 35 million television sets were sold in the U.S. in 2004. Of these, roughly 7 million were digital. The annual sales rate of analog television receivers is four times as large as for digital TV sales.
We can play with these numbers a bit. If we project that the total number of TV sets sold in the U.S. will remain at 35 million units a year, and that the unit sale of digital TV sets will increase by 50 percent each year, it won’t be until some time in 2007 that more digital sets will be sold in a year than analog sets. Increases of 50 percent are easy in the early years when the base number is small, but become much more difficult when the numbers are large. So 2007 is optimistic. Using these optimistic figures, essentially all the sets sold in 2008 will be digital. But between 2005 and the end of 2008, 85 million more analog sets will have been sold against only 55 million more digital sets. Because an analog color TV functions for at least a dozen years, these receivers are filling several rooms in the average household. I’ve seen statistics indicating a current population of over 300 million color TV receivers in the U.S. (plus a huge number of VCRs). It will be a very long time before most TV sets in homes are digital.
A lot of digital set-top box adapters will be needed. But they will likely cost more than a new analog television receiver for a long time. I recall the consumer electronics industry making a huge fuss over the evil cable set-top boxes and how they would cripple the features of the consumer’s television set. As this transition to digital broadcasting continues, the number of non-cable set-top boxes will have to explode.
We hear a clamor from the government to shut down analog TV broadcasts. If indeed the analog broadcasts are going to be shut down, isn’t there a responsibility to advise buyers of these analog receivers of the imminent obsolescence of their purchases? While the price of these products is not a major dent in the income of most of the readers of this column, those price points impact many less advantaged folks. And any large-scale scrapping of analog TV receivers represents an environmental issue. An interesting public policy question, to say nothing of the moral issue, concerns who is responsible for ensuring consumers are making informed choices when purchasing these analog products. Should the responsibility lie on the shoulders of those selling the products? In that scenario, selling an analog TV receiver without a warning on the day before the shut-down of analog transmission could be considered a dishonest and exploitive act. Is it still fraud a month before? How about a year before? When does it become a moral responsibility that a product offered for sale is actually usable? One might argue that because the government is the entity shutting down the analog broadcasts and making those new receivers useless, maybe the government should be informing the general public of the hazards in buying analog TV receivers.
Another aspect of this issue involves the ideals of democracy. Consumers are clearly voting with their dollars. They are choosing analog TV receivers because they feel they are getting the best value for the price. It is hard to believe that the majority of buyers don’t know about digital consumer products in general, and digital television in particular. But do they know or believe an analog shut-down is coming? They certainly know about digital music and would likely be biased in favor of anything digital if given the choice compared to an analog implementation. In spite of this, they continue to choose analog television receivers by a wide margin. The government is telling these citizens that it knows better than they, and it is willing to force a course of action rejected by the majority. Just ask your elderly aunt what she thinks of this. Mine has told me!
This is another misapplication of the principle of eminent domain. There has been a lot in the press lately about local government confiscating the property of citizens by condemnation so that it could be used for a “higher purpose.” Originally, this was done only rarely to build roads, schools, or other public works having few or no other possible locations. The practice became abusive when local governments condemned property to sell it to developers who would construct facilities generating greater tax revenue. A similar action is taking place here. The usefulness of color TV receivers will be taken so that the spectrum used can be auctioned to generate revenue for the government. Yes, there will be some allocation of spectrum for public safety. But the majority of spectrum will simply bring in more money in a lump sum for the politicians to spend as they like.
Maybe consumers themselves should decide–via their purchases and retirement of analog receivers–when analog broadcasts are no longer needed. Maybe it shouldn’t be a cram-down.
Just another reason why VOOM needs to release the SD only client and make it known they are a total service provider who just happens to also deliver the most HD. The folks in marketing need to get their act together.
First of all, let's get one thing straight, I'm NOT anti-Voom. I wish they could work out the kinks. If they could I'd sign right back up. The problem is they need to survive to work out the kinks. I think they've got a tough job--surviving. Not crying, "They're shutting down!" Just saying it ain't as easy as some of you feel it is.
I guess I didn't realize what an expert in this field you are. I guess because I don't sell equipment to dealers I don't know anything about basic business? It's got nothing to do with satellite or anything else...it's about business. Can they obtain funding in order to keep the thing going? Anything can happen but, if it were as great an idea as you seem to think it is, why hasn't everyone jumped up and thrown money at it? Someone said one of the previous press releases said funding was already accounted for. Not sure I know which one they are referring to because I only remember vague quotes about funding and nothing concrete. Heck, the latest stuff CERTAINLY does NOT indicate funding is in place in the least bit.
And again, if they can't handle a few tens of thousands of subs, how do they intend on gaining enough customers to keep everything going? They're going to have to change a LOT about what they're doing in order to keep it all going. Can it happen? Sure. Is it likely? Probably not. (Notice, I say PROBABLY because I'm not claiming to know any more than anyone else out there.) They need a LOT more than the few tens of thousands of subs they have now. I won't claim to know how many they need but I'll bet all of my savings it's significantly more than that.
The Rickster
Unfortunately the Internet and message board Forums like this were not as popular when DirecTV first started or you could have typed some of the same complaints/install issues/money losses that you are now.
Amazon lost money for 5 years. Netflix still does(remember "who's going to pay to rent a video?"). History is riddled with companies that never made sense from a pure acounting perspective but they managed to not only survive, but thrive in some cases. Granted many, many more have fallen by the wayside, but as others have suggested you have to think outside the box. If it's a bean counter's call, Dolan Sr. would have left this for dead a loooong time ago. He thinks a little differently than you. Maybe that's why he lives in the big $$$ mansion and we're sitting here debating TV.
Amazon lost money for 5 years. Netflix still does(remember "who's going to pay to rent a video?"). History is riddled with companies that never made sense from a pure acounting perspective but they managed to not only survive, but thrive in some cases. Granted many, many more have fallen by the wayside, but as others have suggested you have to think outside the box. If it's a bean counter's call, Dolan Sr. would have left this for dead a loooong time ago. He thinks a little differently than you. Maybe that's why he lives in the big $$$ mansion and we're sitting here debating TV.
cfarm said:Unfortunately the Internet and message board Forums like this were not as popular when DirecTV first started or you could have typed some of the same complaints/install issues/money losses that you are now.
Amazon lost money for 5 years. Netflix still does(remember "who's going to pay to rent a video?"). History is riddled with companies that never made sense from a pure acounting perspective but they managed to not only survive, but thrive in some cases. Granted many, many more have fallen by the wayside, but as others have suggested you have to think outside the box. If it's a bean counter's call, Dolan Sr. would have left this for dead a loooong time ago. He thinks a little differently than you. Maybe that's why he lives in the big $$$ mansion and we're sitting here debating TV.
What a great point. He redifined how america saw tv once. Witht he intro of hbo and pay tv channels on top of pay cable that everyone complained about back then. Maybe his success with that is on the brink again.
rtt2 said:
If the article didn't break down the "digital ready" from the "integrated digital" then it's hard to get an accurate picture. Federal law states sets over 36" built after July 1, 2004 must have an integrated tuner. That mandate moves to progressively smaller sets until 2007.
By law you won't be able to sell a set without a digital tuner unless it's just old stock built before the deadline. Your assumptions will be skewed if you don't understand the digital tuner requirement.
The price point of $70 for a digital to analog STB has been quoted by the CEO of LG Electronics in Congressional testimony. The older analog sets will not simply go dark overnight. One of the issues before Congress today is the subsidizing of STBs for lower income households. That in itself is a touchy issue.
The ongoing problem is a new drop dead date for the ending of analog broadcasts has not been set. When the legislation was passed in the Telecommunications Act back in 1996, the Broadcasters fought and won the 85% rule. That is 85% of households must be capable of receiving digital broadcasts before the analog can end. It's loosely worded, but the Broadcasters have continued to use the excuse while they double dip with both analog and gifted digital spectrum. The original agreement was to end analog by the first of next year and give back the spectrum to the goverment for auction. Both sides recognize that the marketplace is not ready for that transition. They continue to argue about when that date might come. Congress is about to jump in the middle of it and ideas of 2009 being named the new drop dead date are being floated. President Bush is even proposing penalties in his new budget for broadcasters who don't give back the analog spectrum by that date.
Can't very well put the onus on the retailers without a date being set. For all they know/care this issue will drag out indefinitely.
Part of it is choosing analog because that's all there is available. Lack of education on the issue certainly plays a role too.
rtt2 said:
Well that article sure hit the nail on the head and should be a reality check. Most people whose analog tvs are working fine and they are satisfied with the reception are not interested in HD. They would probably be interested in HD if they experienced it, but cost is a factor. I bought my HDTV a few years ago not for HD, but for watching dvds (in particular, LOTR). When I heard about Voom with all of its HD and it offered most of the SD channels I got with cable for close to the same price, I switched. There are millions out there with analog tvs who might go with Voom if they could get their SD channels as well as the HD for about what they pay for cable. Then they might be tempted to get HDTVs to view the HD they are missing. That may be a path worth following.
Look at quarterly losses, not the brightest future, it is something that they may dodge this bullet but they will need massive overhauls to get to an acceptable limit. I only used d* because it was the only one used in the example to bash me. I know full well there are other examples. And it may have changed in the last couple months but last time I actually called v* about getting service they required the phone line. If not then I wouldn't mind joining the fray.
Sean Mota said:
I havent jumped any gun. I havent said Voom will go dark on April 1st. I have said that there is no statement that it wont though. As far as I know, to date this is all we have:
This Agreement shall terminate at 5:00 P.M. New York
City time on March 31, 2005. Dolan shall have the
right to terminate this Agreement at any earlier
time. Upon any termination (i) any cash or Funding
Shares not previously cancelled, other than
Segregated Cash or Segregated Shares, shall be
returned to Dolan, and (ii) the shutdown of Rainbow
DBS shall be implemented immediately. Cablevision
may terminate this Agreement immediately upon the
occurrence of any breach of the terms
hereof by Dolan or Tom Dolan. Upon any termination, the
Segregated Cash and Segregated Shares shall be held as
security against claims arising out of the commitments or
actions that gave rise to their segregation.<!-- / message -->
Comparisons...
Amazon was still selling a LOT of books. Netflix is still renting a LOT of DVDs so there's a trend TOWARDS profitability. Voom, on the other hand, has signed up a handfull of subs in over a year. They're not showing the capability to sign up many more.
It certainly could happen but it's not easy by any means. It's not a black and white question on whether Voom will survive. Just because a bunch of people like us--who are into technology--want them to work doesn't mean the general public gives a darn about HDTV or Voom or anything else like this for that matter.
The Rickster
Again, you CANNOT really compare Voom to these kinds of companies. First of all, you're talking about a TOTALLY different time than we're in now. Pre-Enron if you will.
Amazon was still selling a LOT of books. Netflix is still renting a LOT of DVDs so there's a trend TOWARDS profitability. Voom, on the other hand, has signed up a handfull of subs in over a year. They're not showing the capability to sign up many more.
It certainly could happen but it's not easy by any means. It's not a black and white question on whether Voom will survive. Just because a bunch of people like us--who are into technology--want them to work doesn't mean the general public gives a darn about HDTV or Voom or anything else like this for that matter.
The Rickster
GadgetRick said:
Doubling of subs in 90 days would suggest you are wrong. The fact that they only managed 26k in nearly a year factoring in the churn, then turned it around to doubled in a very short period says they are addressing the issues that were slowing new subscriber additions previously.
Somewhere in the forum is a link to an article from 3 years ago which estimated the startup costs of a new DBS provider at somewhere between 2 and 5 billion dollars. Cablevision has spent $1.4B according to recent reports. Keep in mind the earlier report was before service was even rolled out. So with that information, it doesn't make much sense to sit here and wonder why it's not profitable at this stage and will not be profitable for some time to come.
The Amazon and Netflix examples were used simply because they also had many naysayers along the way who said the doors should be shut. In that respect, no different here.
Enron simply puts the Board of Directors in a more trigger happy mode. Remove any possibility of fraud or negligence and it's a non-issue.
