Disney drops 2.4 million streaming subs

[Juan]

Sure, but even the best house of cards must eventually fall. Also, isn't there some phrase along the lines of "past performance is not indicative of future results" that every public company includes in all of their PR? I realize it is boilerplate, but it seems like something companies should actually pay attention to rather than just assume the world will never change.

They are still making billions.on cable and satellite. But with streaming..they are just spending billions building the field of dreams..build it and they will come..or so they hope

 

[ncted]

They are still making billions.on cable and satellite. But with streaming..they are just spending billions building the field of dreams..build it and they will come..or so they hope

I wasn't arguing the merits of streaming vs. cable. I was saying ESPN and the RSNs should have seen this risk way before it became so untenable. This should be a case study in business school. Technology disrupts and tastes change, so don't build your business model on people who don't use your service/product paying you money every month.

Arguably, the same can be said for streaming companies. They count on a certain amount of revenue from people who don't actually watch anything on their service every month. The difference is it is a lot easier to cancel Disney+ or Netflix than it is to cancel cable or satellite, so they can't count on too many people doing that indefinitely like traditional cables channels have.

 

[SamCdbs]

Well said.

Anybody who thinks there are "too many streamers" is missing the point. Bilbo1 is correct when he points out that what we are seeing is just re-bundling in a different (far less consumer friendly) form. Each major content creator is going to sell you a wad of reruns and just enough original content to get you to pay for each one. And, sadly for the consumer, each is now going to toss in just enough sports to make you buy every one of these rerun/melodrama packages. Why? Out of date quote, but still apt. "Because you cannot go to Blockbuster and rent tonight's game." So every streaming service will always be what it is today, a mix of reruns, melodramas, and sports. Just enough sports to force subscribers to pay up for material they really don't want.

Back to Disney. The issue for Disney is pretty simple. First it cannot figure out what to do with the money pit that is Disney +. What exactly is it going to do with it? It just cannot make money. More Star Wars variants? More reruns out of a vault that is mostly for children?

And then there is the once cash cow of ESPN. ESPN linear. It just cannot be sold at an affordable price a la carte. And, as contracts expire, and sports leagues are really just content creators, it will find itself in a conflict with the general streamers, who need a little sports to drive subscriptions, while it is trying to maintain a 24/7/365 package that is just unaffordable.

And then there is ESPN+. Originally just was going to be a place to burn off all the excess college rights Disney has, as it generally buys the whole conference and shows only a handful of games on linear TV. No one wanted this, and now it is paying to nationalize RSN broadcasts in hockey and show early rounds of golf. Whop.

Will it work? Hasn't yet. Every streamer's sports venture so far looks like a failure. Certainly Amazon's NFL deal was (know anyone who got Prime to get the games?). All of the soccer is a niche play anyway.

 

[Juan]

I wasn't arguing the merits of streaming vs. cable. I was saying ESPN and the RSNs should have seen this risk way before it became so untenable. This should be a case study in business school. Technology disrupts and tastes change, so don't build your business model on people who don't use your service/product paying you money every month.

Arguably, the same can be said for streaming companies. They count on a certain amount of revenue from people who don't actually watch anything on their service every month. The difference is it is a lot easier to cancel Disney+ or Netflix than it is to cancel cable or satellite, so they can't count on too many people doing that indefinitely like traditional cables channels have.

Sports will have a place..it just has to shake rattle and roll first

 

[ncted]

Sports will have a place..it just has to shake rattle and roll first

Yes, absolutely. There is a market adjustment coming for sports. It won't be as expensive as it was/is, but it will still be around.

 

[MikeD-C05]

As long as I don't have to pay for sports. I stopped when I had DISH and went with the Flex pack that allowed you not to buy sports. I will insist on that with any streaming service I subscribe to as well. Don't want sports that jack up my price.

 

[SamCdbs]

As long as I don't have to pay for sports. I stopped when I had DISH and went with the Flex pack that allowed you not to buy sports. I will insist on that with any streaming service I subscribe to as well. Don't want sports that jack up my price.

On demand streamers:

Apple - sports
Amazon - sports
Peacock - sports
Paramount - sports
Hulu - sports
HBO Max - sports

(That leaves Netflix)

Substitutes for cable/DirecTV that do not have at least some combination of ESPNs, FSs, TNT, TBS, USA, Tru, all containing sports. Plus, unless you are lucky enough to get local TV OTA, NBC, ABC, CBS, and Fox. Sports.

(end of list)

Welcome to the re-bundle. In the old bundle, the cable bundle, the consumer was protected. One bundle, everyone paid a fair price. Was there material you didn't want? Umm, yeah. There is more material on cable, et al, than there are days. And? The new bundle? Actually bundles. The get all the things you want, you have to pay for 8 or 10 or 12 different wads of reruns, melodramas and sports, PLUS a linear alternative. The consumer? Ripped off by Big Media.

Or watch Netflix and free crap rerun services like Pluto and Stirr.

 

[ncted]

In the old bundle, the cable bundle, the consumer was protected. One bundle, everyone paid a fair price.

I disagree with the protection and fair price assertions here. Protected from what exactly? The constant addition of fees (equipment, broadcast, RSN, etc) was not consumer protection, especially for customers stuck with contracts. It was extortionist. As for "fair price," decades of annual (and sometimes more often) price increases that far exceeded inflation rates, is not what I would consider fair. Throw in that the picture quality continued to degrade over time as they stuff more and more channels no one was asking for into the same bandwidth, and there was nothing pro-consumer about traditional cable/satellite bundles besides that they actually offered the service at all.

The only thing keeping the prices they charge from being any higher these days is some actual competition from streaming.

As for sports, it is obvious that leagues are discovering that their traditional broadcast partners aren't afford their fees long term, so they are turning to streaming services to protect against a future where no one will be willing to pay what they paid last time. Hopefully for those leagues, they are preparing for that future when revenue declines better than ESPN and Bally Sports have.

 

[Bilbo1]

Yes, there will be a market adjustment for sports… it will cost more

The RSNs on aggregate are some of the highest rated (most viewers) networks on cable. Somewhere around 2-3 million viewers a night if you add the average viewers for each MLB team on their RSN. That’s why they are on just about every cable system.

Even at current costs, sports cost less per hour than pretty much everything else. The NFL rights cost less than $15 million per game hour, production has to be much less… a couple million? Fairly cheap compared to scripted programs. Sports are also very advertising friendly… lots of natural breaks for ads.

Apple is looking to grow their footprint in sports. They have added MLS, and are reportedly bidding on MLB and the English Premier League. I could see ESPN as a possible takeover candidate for Apple or Amazon, particularly if they could get the BAMTech/Disney Streaming tech, too.

Anyway, if you are looking to avoid subsidizing sports, good luck with that.


Sent from my iPhone using Tapatalk

 

[Bruce]

I disagree with the protection and fair price assertions here. Protected from what exactly? The constant addition of fees (equipment, broadcast, RSN, etc) was not consumer protection, especially for customers stuck with contracts. It was extortionist. As for "fair price," decades of annual (and sometimes more often) price increases that far exceeded inflation rates, is not what I would consider fair.

You should remember, he receives his DirecTV via his Landlord’s account and claims it is part of his rent.

So as he bloviates about pennies saved, life is short with regards to the pricing of Live TV, he is not impacted by the constant increases, fees, high prices that everyone else is that has a Traditional Provider.

As I said before, I could easily afford DirecTV, but I find no value with it, growing up extremely poor taught me to appreciate the dollar, I get so much more value with streaming (content, Picture quality, etc) and it is extremely less expensive.

 

[ncted]

Yes, there will be a market adjustment for sports… it will cost more



Anyway, if you are looking to avoid subsidizing sports, good luck with that.

Yes, the costs per sub will go up over time, but the number of subs will continue to decline, so the actual amount of money being funneled from consumers into sports leagues will necessarily decline at some point. Your point about it being cheap to produce just reinforces my thoughts that it should cost a lot less than it does.

As for avoiding subsidizing sports, yeah, it is not completely avoidable at this point unless you get everything on physical media and OTA. But, I personally could spend a lot less subsidizing sports if I wanted to by managing when I sub to which streaming service. Even without that, I am not the one directly subsidizing sports on Appletv+, Prime, Peacock, HBOmax, etc. It is those companies doing so as they are all likely losing money on sports right now. Now, I may be indirectly subsidizing sports by buying an iPhone, shopping at Amazon, going to Universal Studios, and having AT&T Fiber, but that is out of my control.

Full disclosure: I have a YTTV sub as of about 1 month ago after my Tablo died. My wife wanted it for a more responsive UI and more reliable DVR. Before that, the only sports I watched was F1 on F1TV. Now that I have access to ESPN, FS, etc., I have been watching some college basketball and enjoying it, so I am not anti-sports in general, just anti-paying half my entertainment budget on something I infrequently watch.

 

[Juan]

Protect the customer from paying an extremly high price for individual channels..the low price on one channel offsets the high price on another...not to mention its easier to get a better price on a channel when you can offer 3k subscribers to a provider instead of 50...simple economics

More subscribers to share the cost

The channel costs x to produce
X/3k is much better than x/50

 

[Bruce]

Protect the customer from paying an extremly high price for individual channels..the low price on one channel offsets the high price on another..

That is 100% untrue, they create lessor channels to get more per sub fees and Ad Revenue.

.not to mention its easier to get a better price on a channel when you can offer 3k subscribers to a provider instead of 50...simple economics

That part is true, for example, Comcast should get a bigger discount because they have 16 Million Video Subscribers, while DirecTV Satellite is now under 10 million, so not as big of a discount.

More subscribers to share the cost

And most hate that, example, for the NY Yankees, why should millions support YES with the RSN fee when only 219,000 watch on average.

By the way, I am going to miss talking about this stuff soon.

 

[Ronnie-]

There is Philo for those that want some linear tv and don’t want sports.

 

[Bilbo1]

Ok, so Tapatalk and the forum aren’t playing nice when it comes to a quotes… at least in my iPhone

Anyhow, if you think sports teams revenues are going to go down, they never have. So, that would definitely buck history. I would bet that they will increase greater than inflation in the future.


Sent from my iPhone using Tapatalk

 

[SamCdbs]

. Protected from what exactly?

Big Media.

Let's take apart any random streaming service. What is it? First a wad of reruns. 90% of any streamer is just reruns from real television. Many reruns shared across multiple services (AKA paying for the same thing twice) and many are available free, if you are willing to watch commercials, on FAST (which is a cesspool of worthless content, but a discussion for another day) or on netlet digital channels OTA (AKA paying for things that are free). 5% is reruns of old original content. Then we have what you are actually paying for. The small amount of new original content. Most of it "high concept" and the majority estrogen soaked. And then there is sports. Sports it there to prevent the (very logical) "binge and cancel" trap. It is the only answer the unprofitable streaming industry has come up with to attempt to solve this (IMHO fatal) flaw in the streaming business plan.

So if you want the current shows that are being made, and the sports (and not, well I can watch Eastern Michigan - Ball State, or I can watch the backmarkers play in the earn morning before the golf moves to the leaders and such nonsense, the actually current popular sports) you have to pay for 8 or 10 or 12 bundles. Wads and wads of reruns.

Where, before, one price. The consumer protected. As Juan explains:

The channel costs x to produce
X/3k is much better than x/50

and, because very few entertainment forms are something a threshold number of people are willing to, and are able to, pay that much for, they go away. Less and less original content, filmed and sports. More and more reruns. And Big Media gets yet richer.

 

[Juan]

Ok, so Tapatalk and the forum aren’t playing nice when it comes to a quotes… at least in my iPhone

Anyhow, if you think sports teams revenues are going to go down, they never have. So, that would definitely buck history. I would bet that they will increase greater than inflation in the future.


Sent from my iPhone using Tapatalk

The mlb will take over the RSNs that are going bankrupt..they won't just disapeer...it all depends what happens next

 

[ncted]

Ok, so Tapatalk and the forum aren’t playing nice when it comes to a quotes… at least in my iPhone

Anyhow, if you think sports teams revenues are going to go down, they never have. So, that would definitely buck history. I would bet that they will increase greater than inflation in the future.


Sent from my iPhone using Tapatalk

Tribune's revenue never went down, until it did. Also true for lots of other things. Sports costs are just unsustainable IMHO. Every year that passes, it becomes ever more clear that this is the case. Look at what is happening with European Football (soccer). Piracy is killing broadcasters because so few actually pay to watch the games anymore. People will only pay so much to watch.

 

[ncted]

Big Media.

Let's take apart any random streaming service. What is it? First a wad of reruns. 90% of any streamer is just reruns from real television. Many reruns shared across multiple services (AKA paying for the same thing twice) and many are available free, if you are willing to watch commercials, on FAST (which is a cesspool of worthless content, but a discussion for another day) or on netlet digital channels OTA (AKA paying for things that are free). 5% is reruns of old original content. Then we have what you are actually paying for. The small amount of new original content. Most of it "high concept" and the majority estrogen soaked. And then there is sports. Sports it there to prevent the (very logical) "binge and cancel" trap. It is the only answer the unprofitable streaming industry has come up with to attempt to solve this (IMHO fatal) flaw in the streaming business plan.

So if you want the current shows that are being made, and the sports (and not, well I can watch Eastern Michigan - Ball State, or I can watch the backmarkers play in the earn morning before the golf moves to the leaders and such nonsense, the actually current popular sports) you have to pay for 8 or 10 or 12 bundles. Wads and wads of reruns.

Where, before, one price. The consumer protected. As Juan explains:

The channel costs x to produce
X/3k is much better than x/50

and, because very few entertainment forms are something a threshold number of people are willing to, and are able to, pay that much for, they go away. Less and less original content, filmed and sports. More and more reruns. And Big Media gets yet richer.

Sorry, but I don't feel protected from Big Media by the cable company bundle. Maybe what you posit might have been somewhat true at one point in time, but that would have been a long time ago. This is a lot like saying Facebook is protecting me from advertisers tracking my activity across the Internet.

Now, you do make a good point that less and less quality content is on linear TV. It is largely on the streaming services now. I am surprised more of it hasn't ended up back on the linear channels once it has been on the streaming services for a while. Given the excess of overly expensive content being produced these days (largely for streaming How Long Would It Take To Watch Everything On Netflix?), I don't see a reduction in content creation being a bad thing. Companies have invested too much too fast in new content. That much is clear from their balance sheets. I believe we are soon to enter the trough of disillusionment on the streaming hype cycle. We'll see consolidation, pull-back, and sanity start to prevail over the next couple of years, and we will see who can make the business model work on the other side of it.

I can see what everyone is trying to do by including sports in their streaming services, but I am not sure it will work the way they want it to in the long run.

 

[Juan]

Sorry, but I don't feel protected from Big Media by the cable company bundle. Maybe what you posit might have been somewhat true at one point in time, but that would have been a long time ago. This is a lot like saying Facebook is protecting me from advertisers tracking my activity across the Internet.

Now, you do make a good point that less and less quality content is on linear TV. It is largely on the streaming services now. I am surprised more of it hasn't ended up back on the linear channels once it has been on the streaming services for a while. Given the excess of overly expensive content being produced these days (largely for streaming How Long Would It Take To Watch Everything On Netflix?), I don't see a reduction in content creation being a bad thing. Companies have invested too much too fast in new content. That much is clear from their balance sheets. I believe we are soon to enter the trough of disillusionment on the streaming hype cycle. We'll see consolidation, pull-back, and sanity start to prevail over the next couple of years, and we will see who can make the business model work on the other side of it.

I can see what everyone is trying to do by including sports in their streaming services, but I am not sure it will work the way they want it to in the long run.

There are only a couple big media companies...thats the real issue