DirecTV Q1 2019 Results - 627,000 Net Loss Subs (DirecTV & Directv Now)
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Which is irrelevant since Directv has built all the satellites they ever will, unless they want to continue offering satellite service beyond the early 2030s. But hey, let's mention how much it costs. Around $400 million or so, from figures I saw for satellites similar to or slightly more complex than Directv's.
Sounds like a lot, but they last at least 20 years, so that's only $20 million a year, or about $1.7 million a month. Divided by nearly 20 million subscribers, that's a dime per subscriber every month. Oh yeah, that'll break the bank!
The satellite build cost is depreciated over its expected service life and factored into the reported satellite transmission costs.
Look up how much electricity the data centers use. It will blow your mind.
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using the SatelliteGuys app!
Will they have the DTV over IP servers working at the DTV broadcast centers? Would that be efficient way to keep both and keep DTV over SatelliteTV around for awhile until DTV over IP takes over?
They've farmed most of the actual video serving out to Akamai. This happens with servers that are installed all around the world, including in data centers close to where your ISP central office is located (maybe even in the ISP central office itself).
For scale, let's use a Backblaze storage pod as an approximation for what these CDN caching servers look like. (Server, loaded with disk, and 10/40/100 gig network interfaces)
Akamai has 216,000 content distribution servers installed globally. If you size the delivery throughput off of Netflix Openconnect box stats, you can expect ~18Gbps throughput out of each server.
18,000mbps / 8mbps (DTVN stream, highest quality) = 2250 streams per box. (assuming the box has the memory and processor to be able to handle that session count)
Start doing the math on how many servers you need to provide 100% streaming service to an event like the Superbowl and the numbers get astronomical quickly.
Found this article discussing their streaming strategy.
Bleeding DirecTV Subscribers, AT&T Throws Five Streaming Services At The Wall
Bleeding DirecTV Subscribers, AT&T Throws Five Streaming Services At The Wall
The wee little Directv uplink facility I worked at consumed around 1 MWh when I left 5yrs ago. Probably more now.
Yea, but the uplink facility that sends all the stuff to the satellite uses a boat load of electricity. Back when they were all Klystron amplifiers, imagine 56 of them sucking maybe 10KVA each continuously and that was at a fairly small site. Then add all the other infrastructure and lighting. The electricity bills are enormous.
So I think we can all agree that delivering TV to millions of customers costs a sh*t ton of money, whether you do it via satellite or internet...
Satellite has an advantage that changing number of customers at the margin doesn't affect that cost, while more customers for streaming make it more expensive. On the other hand, with satellite's customer base having peaked a couple years ago and now in terminal decline, someday there will be too few customers across which to spread the costs. Assuming you aren't talking about launching new satellites, I think you'd have to be below a million customers before that cost became a problematic - and even then if there are still customers who don't have any reasonable streaming alternative they might not have much choice but to pay a $5 or $10 monthly 'satellite surcharge'.
Satellite has an advantage that changing number of customers at the margin doesn't affect that cost, while more customers for streaming make it more expensive. On the other hand, with satellite's customer base having peaked a couple years ago and now in terminal decline, someday there will be too few customers across which to spread the costs. Assuming you aren't talking about launching new satellites, I think you'd have to be below a million customers before that cost became a problematic - and even then if there are still customers who don't have any reasonable streaming alternative they might not have much choice but to pay a $5 or $10 monthly 'satellite surcharge'.
I watch Cord Cutters and a lot of people have dropped satellite & cable. The reason is the pricing is way out of line and there are too many added on fees. When a subscriber is paying $200-$250 a month for TV, that is crazy. I pay under $90 a month for Dish and for what I get, it is still worth it. But once I am stuck to pay over $100, I will be looking elsewhere. I have been with Dish for 20 years now. Direct TV was and is too expensive for basically the same entertainment. I am not into sports. But one poster said, he was paying $235 a month with Direct and now he pays $70 with streaming and watches everything he wants.
From the viewers standpoint, where in today's World they are looking for the best deal out there. They could care less what the providers overhead is. There are many streaming services that are offering decent packages as now as $15 a month (AT&T), and many under $50. Very little overhead compared to putting up a satellite.
The reality of all of this is the price for Linear TV has peaked. As consumers have been dropping linear TV service Third Party Linear Providers will likely continue to offer extreme discounts on Bundled Linear TV/Internet. Most end Users need a FAST Internet Connection when considering Streaming Options, in most areas the only option is "THE CABLE COMPANY. Cable Companies Internet Only product is extremely expensive in comparison to a Bundled service, so as the price of stand alone Streaming services ramps up quickly and likely faster than Linear TV, Third Party linear TV/Internet subscriber losses will slow dramatically over the next 2 years.
Streaming content seems to be a better deal (at the moment), but just over the last 6 months most streaming services have raised prices more than 20 percent. In the end, Linear TV will likely be a comparative value when compared to needing Multiple Streaming services, and an extremely expensive Internet Only and or possibly Capped Internet Service.
In all likelihood 2 plus years from now Streaming Service with an Internet Only subscription will be on Par with Linear TV/Internet Bundles. Streaming providers are all LOSING BOAT LOADS of money to attract subscribers, these providers will be forced to ramp up user fees to maintain an actual profitable service and keep Shareholders happy, which will cause streaming to lose favor with end users.
Streaming content seems to be a better deal (at the moment), but just over the last 6 months most streaming services have raised prices more than 20 percent. In the end, Linear TV will likely be a comparative value when compared to needing Multiple Streaming services, and an extremely expensive Internet Only and or possibly Capped Internet Service.
In all likelihood 2 plus years from now Streaming Service with an Internet Only subscription will be on Par with Linear TV/Internet Bundles. Streaming providers are all LOSING BOAT LOADS of money to attract subscribers, these providers will be forced to ramp up user fees to maintain an actual profitable service and keep Shareholders happy, which will cause streaming to lose favor with end users.
streaming services will change.
stations/content creators are seeing the light of the income, and creating thier own service
cbs all access, disney, more to come
these may be the only sources for that content eventually, forcing people to sub to multiple services for streaming.
i think we are on the cusp of a change
stations/content creators are seeing the light of the income, and creating thier own service
cbs all access, disney, more to come
these may be the only sources for that content eventually, forcing people to sub to multiple services for streaming.
i think we are on the cusp of a change
And your streaming servers do consume a bit of electricity - like 7 billion dollars a year.
Berkeley Lab: It Takes 70 Billion Kilowatt Hours A Year To Run The Internet
They've farmed most of the actual video serving out to Akamai. This happens with servers that are installed all around the world, including in data centers close to where your ISP central office is located (maybe even in the ISP central office itself).
For scale, let's use a Backblaze storage pod as an approximation for what these CDN caching servers look like. (Server, loaded with disk, and 10/40/100 gig network interfaces)
Akamai has 216,000 content distribution servers installed globally. If you size the delivery throughput off of Netflix Openconnect box stats, you can expect ~18Gbps throughput out of each server.
18,000mbps / 8mbps (DTVN stream, highest quality) = 2250 streams per box. (assuming the box has the memory and processor to be able to handle that session count)
Start doing the math on how many servers you need to provide 100% streaming service to an event like the Superbowl and the numbers get astronomical quickly.
Nice post, interesting data points. I'd only add, pursuant to your last sentence, that nowhere close to 100% of viewers of big live events such as the Super Bowl will probably ever be served by unicast (one-to-one) streams as opposed to some form of one-to-many distribution. "What about the Super Bowl?" is sort of a straw man argument of why the future of TV can't possibly be IP-based. As you say, it would require an astronomical amount of bandwidth and server processing to deliver such a live telecast to 100 million simultaneous viewers exclusively through unicast streaming. But I do believe we're moving toward a future when virtually all on-demand video -- whether that's Netflix or YouTube or the VOD and cloud DVR that comes with a multichannel TV service -- will be delivered via unicast streams. (Only DBS satellite TV boxes without a broadband connection will rely on local DVR and pre-downloaded VOD. Meanwhile, video on rented or purchased discs is already fading. Perhaps local DVRs for use with OTA TV will stick around as a niche product.)
So, as more and more of our viewing moves to SVOD apps (Netflix, Hulu, YouTube, Disney+, Prime Video, Warner/HBO, etc.), an increasing percentage of the video we watch will be delivered by unicast streams as opposed to some type of broadcast/one-to-many distribution. BUT those live events, such as sports, that draw large number of simultaneous viewers will probably always be delivered to the vast majority of viewers through a combination of OTA broadcast channels, DBS satellite channels, QAM cable channels, and multicast IPTV. Multicast, of course, is a one-to-many form of streaming video and is FAR more efficient than unicast when a lot of viewers are watching the exact same thing at the exact same time, such as live sports. But multicast can only be provisioned on a broadband provider's own network, not across those parts of the internet outside their control.
As we move through the 2020s, DBS satellite customers will dwindle and broadband/cable TV operators will switch over from QAM to IPTV, using multicast for the most-watched channels (local affiliates of the broadcast networks, sports channels and news channels). By 2025, I can imagine it being the norm to subscribe to a skinny bundle of multicast IPTV channels (with a unicast-delivered cloud DVR) from your broadband provider -- mainly consisting of locals, sports and news channels -- supplemented by whichever OTT SVOD services (delivered exclusively via unicast streams) you choose for general entertainment content. Whether you use a TV box provided by the broadband provider or your own retail box from Apple, Amazon, Roku, etc., they'll all integrate that content together using their own UI design. Your broadband gateway will automatically fetch multicast versions of live channels/events if provisioned by your broadband provider. Even if the whole concept of "TV channels" eventually dies, with all live sports being delivered through app-based services such as ESPN+ and MLB.TV, all the popular games/matches could still be provisioned through multicast if a broadband provider cooperated with the sports service from which the video originates. Each broadband provider (e.g. Comcast, Charter, AT&T, Verizon, T-Mobile, etc.) would need to do that separately but it would be in their own interests to do so to help control their network traffic and deliver a quality viewing experience to their broadband subscribers.
So there you have it: the future of all video is unicast streams for everything except the content that draws large numbers of simultaneous viewers, such as live sports. That content will increasingly be delivered via multicast streams. But it'll eventually all be some form of IP-based streaming delivery. The internet is eating what we used to call "TV" and that trend won't be reversed.
In the article I posted above they seemed to think that AT&T is testing all five of their streaming services to see which one sticks. What if AT&T would decide to do something like the Hulu Live TV and Hulu VOD combo? AT&T could eventually have it down to just DTV over IP and their Warner Media VOD service and offer those in combo or get them as separate services.
Yeah, I think that's more or less the long-term plan. And they'll probably evolve the UI on the DTV-over-IP box to tout the upcoming WarnerMedia SVOD because, yes, they'll really, really want you to subscribe to that too. In fact, maybe it won't even be optional. You'll be able to subscribe to the SVOD by itself but maybe the SVOD will be priced into the base cost of the multichannel DTV-over-IP service, the same way that HBO is priced into the base cost of the new DTV Now packages.
AT&T really wants you to subscribe to HBO. And this upcoming SVOD is just going to be an expanded HBO, their direct-to-consumer Netflix competitor, basically a single on-demand service that incorporates all of their non-live-sports-or-news content. Look for this forthcoming "HBO+" SVOD to gradually cannibalize nearly all their Turner basic cable content (while also monetizing all those WB movies and shows in the vault). The sports from TBS and TNT may eventually get spun off into a separate Turner Sports channel and/or absorbed into their Bleacher Report OTT service, while TBS, TNT, TruTV, Cartoon Network, etc. wither away and die. They eventually won't serve any purpose as linear channels because all their content will be subsumed within the SVOD, where they can reach viewers on any internet-connected device with Xandr-powered targeted advertising.
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