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NBC to launch own service (good luck with that)!

Discussion in 'Cord Cutters Club (Internet TV)' started by KAB, Jan 14, 2019.

  1. harshness

    harshness SatelliteGuys Master

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    I wouldn't pick any survivors until they all figure out what the self-supporting package prices are for the various services. We know that most, if not all of them are losing money and that's not sustainable no matter how deep your parent company's pockets.

    Reasoning that OTT must be this or that relative to the old-school distribution model isn't good enough. The services have to make a profit.
     
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  2. NashGuy

    NashGuy SatelliteGuys Pro

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    That's true, although keep in mind that when you hear that Hulu is running up debt, a lot (though not all) of that debt is generated in order to license content from various parts of Disney and Comcast -- the companies that actually own Hulu. So a lot of Hulu's debt is funneled to its corporate parents as income.

    In the same way, accounting will be done for Disney+ as a standalone unit and Disney projects that it will be in the red for a few years because it will accrue lots of debt to license content from... other parts of Disney.
     
  3. theBruce

    theBruce Supporting Founder
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    Still is considered debt since Disney is losing out on income from licensing out it’s content to other services just so they can put it on their service.

    For example no more income from Netflix for their newer movies (rumored to be up to $50 million a film depending on how it did at the Box Office), all movies released at the theater in 2019 will be on Disney+ instead.




    Sent from my iPad using SatelliteGuys
     
  4. NashGuy

    NashGuy SatelliteGuys Pro

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    Yeah, although it's really an opportunity cost, not debt in the way we normally think of it. Imagine a married couple living together with all shared bank accounts and finances. If the wife sells her car to her husband at a fair market rate of $10k, and the husband takes $10k out of the bank to pay her for it, and then she puts that money back in a different shared bank account, did that household accrue any debt? No, they just shifted assets around. It's true, though, that by shifting the car around within their own household that they missed the opportunity to sell the car to an outside person, which would have increased their joint accounts by $10k. That's basically what's happening between Disney+ and the parts of Disney that own the content.
     
  5. NashGuy

    NashGuy SatelliteGuys Pro

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    As part of NBC's deal to eventually sell their 33% share of Hulu to Disney, NBC has also agreed to keep their current season and past season shows on Hulu for the next 3-5 years. (Not sure about which pieces of content may come off at exactly what point during that 2022-24 timeframe.)

    I think this is one reason why the upcoming streaming service from NBC isn't going to offer current-season episodes of NBC shows. (You only get their current-season episodes on the new service if you're already paying for NBC as part of your cable channel package). They figure that cord-cutters that want to watch current NBC shows are already subscribing to Hulu anyway. (NBC shows appear on Hulu the next day, with at least the last 5 episodes available.) And it's in NBC's interests not to erode the Hulu subscriber base, and therefore Hulu's overall market value, because the actual amount of cash that NBC will get for selling their 33% share goes up if Hulu does well over the next few years but it goes down if Hulu fares poorly.

    So for the next few years, the NBC streaming service won't really be competing with Hulu. You'll see a lot of the same NBC-owned content appearing on both services. (Netflix is a different story, though; the NBC streamer may try to compete with them, which is why they'll likely take The Office away from Netflix and make it exclusive to their service. I'd also expect to see some of their past shows leave Prime Video too.)

    But 3-5 years from now, we'll see NBC sell their share of Hulu to Disney and -- if it looks at that point like the NBC streaming service can succeed -- they'll start pulling their current and past season content off Hulu and making it exclusive to their own service. That's when the service will really start competing for cord-cutters.

    At that point (assuming no big changes between now and then), you'll have Hulu as the streaming arm of ABC, FX, and Freeform; CBS All Access as the streaming arm of CBS (and possibly Viacom's cable channels because CBS and Viacom will likely remerge in 2019-20); and the NBC service as the streaming arm of NBC, USA, SyFy, and Bravo. The expanded HBO streamer that launches this fall (HBO Max or HBO+ or whatever they name it) will be the streaming arm of HBO, TBS, TNT, TruTV, TCM, Cartoon Network and Adult Swim. The upcoming Discovery/BBCNature streamer that launches in 2020 will be the streaming arm of Discovery, ID, HGTV, Food Network, and Travel Channel (plus the exclusive US outlet for BBC nature docs like Planet Earth).

    We'll never have individual a la carte cable channels but we do appear to be moving toward a system where each "channel family" has its own a la carte streaming service where they put their new and old content for on-demand consumption.
     
  6. harshness

    harshness SatelliteGuys Master

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    Another much hoped-for "advantage" of OTT bludgeoned to death.
     
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  7. NashGuy

    NashGuy SatelliteGuys Pro

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    Eh, I personally never expected all those individual cable channels to be sold a la carte via OTT. The economics don't make sense to do that. But the bigger point I foresaw was that channels would gradually just fade away and morph into brands associated with certain collections of content. That's what each of these existing and forthcoming SVODs really are.

    In the world of OTT, there's really no point in a given brand having a bunch of different channels that each fill up 70% of their airtime with reruns.
     
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  8. comfortably_numb

    comfortably_numb Dogs have owners, cats have staff
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    But live sports....
     
  9. NashGuy

    NashGuy SatelliteGuys Pro

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    Yup. Live sports is the "killer app" supporting the linear cable channel system and that will likely be the case for at least a few more years.

    We're going to see increasing overlap of the content available in the SVOD world vs. the cable bundle. (The first wave of that happened when HBO, Showtime and Starz moved from being purely cable channels to being hybrid services that also offered all their content via standalone OTT SVODs.) Both sides will feature a lot of the same new entertainment shows, although a given episode might debut on one side a day or so before debuting on the other.

    But each side will also have certain exclusives that the other side doesn't have. On the SVOD side, we'll always see various entertainment series and movies (whether scripted or docu/reality) that aren't on cable TV -- think of all that fresh original content that is and always will be exclusively on Netflix, Hulu, Prime Video, CBS AA, HBO+, etc. You're not gonna see Stranger Things or The Handmaid's Tale on any cable channel.

    On the cable bundle side, the great majority of pro and top-level college sports will remain exclusive to cable channels. I do expect, over time, to see increasing bits and pieces of live sports become available through standalone OTT services such as ESPN+ but I think it'll take years for the dam to break, at which point basically all sports will be able to be viewed live through some subscription app or another. ESPN+ is clearly Disney's lifeboat for the day that happens. Right now, they're just testing the waters but they'll be ready to sell the entire ESPN live and on-demand content bundle as an OTT standalone service through that app when the day comes. Will be interesting to see if Sinclair, after they finish the acquisition of all those RSN cable channels, decides to offer them as OTT standalones, maybe priced at $10/mo each.

    The other thing that I think will prop up the cable bundle besides sports is live feeds of the primetime "talking head" opinion shows on Fox News, MSNBC and CNN. Live news channels are already moving to OTT; CBSN and the Cheddar channels were born in the OTT world (although they're getting added to some cable channel bundles now) as free ad-supported services. ABC News now has something along those lines inside The Roku Channel. NBC News is getting ready to launch their own OTT competitor to CBSN any day now, reportedly named NBC News Now. It's easy to imagine CNN following suit and offering a free OTT news source at some point too, taking advantage of AT&T's Xandr targeted ad platform.

    But what you're not going to see on this new NBC News free OTT channel are their popular MSNBC primetime talking heads (Maddow, O'Donnell, etc.). Fox News is never going to give that stuff away either nor would I expect CNN to. So keeping Hannity, etc. exclusive to the cable bundle will be a reason for some folks to stay there (although they're mainly older viewers; in 2017 the median viewer of both Fox News and MSNBC was 65, and 60 for CNN).
     
  10. comfortably_numb

    comfortably_numb Dogs have owners, cats have staff
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    Nobody wants to see that :D
     
  11. NashGuy

    NashGuy SatelliteGuys Pro

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    Actually, I watch at least part of Maddow's show most nights. NBC News breaks up all their major shows into segments (basically just slicing up each show at the points where there were ad breaks) and puts the whole thing in their NBC News app for Apple TV about 3 hours after originally airing on MSNBC. They put most of it on YouTube as well. But if you want to catch the live feed of MSNBC in the NBC News app, you have to authenticate with your cable TV login.
     
  12. comfortably_numb

    comfortably_numb Dogs have owners, cats have staff
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    This isn't The Pit, so I'll quit now :)
     
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  13. MikeD-C05

    MikeD-C05 Pub Member / Supporter
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    If I could buy an app to MNBC I would do it. It is the main channel I watch for cable news. Paying $10.00 just to have the news channels added to the Flex pack seems too high to me. To get the $5.00 news pack with Sling tv I would still need to pay $25.00 for Sling blue core pack. Just seems like they should offer a stand alone OTT app that provides all MSNC CNBC and NBC news for $5.00 or less that isn’t dependent on having cable or satellite programming. Sooner or later they will have to consider this as an option as more people are cutting the cord and even cutting out the skinny bundles that Satellite and cable offer.
     
  14. NashGuy

    NashGuy SatelliteGuys Pro

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    Well, keep in mind that NBC is owned by Comcast and they're not thrilled on the idea of unravelling the cable channel bundle. My guess is that a standalone streaming NBC News bundle (including the live feeds of MSNBC and CNBC) priced at $5 would probably be a net money-maker for them -- depends on how many additional current cable TV subs would be encouraged to cancel service. My guess is that there aren't too many folks who are sticking with cable ONLY for MSNBC and CNBC.

    At any rate, the simplest solution for you would be to nicely ask a family member or friend who subscribes to a cable TV package with MSNBC if you could use their cable login inside the NBC News app so that you can get the MSNBC live feed (in addition to all the on-demand segments that are already free). If you gave 'em a $40 gift card or bottle of whisky once a year as a thank you, you're only paying $3.33 a month!
     
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  15. Zookster

    Zookster SatelliteGuys Pro

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    That's my workaround for sports channels I can't get with YTTV (NFL Network, Redzone, and Pac-12), using a family member's Dish Anywhere access. The problem is the experience isn't ideal in terms of PQ and stability on my FireTV stick. Fortunately, neither of those channels are deal-breakers for me, so not worth settling for a different OTT service just to get them.
     
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