VOOM Cries Foul Over INHD and INHD2

rtt2

rtt2

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VOOM Cries Foul Over INHD and INHD2

Byline: MICHAEL BASCOMBE

Rainbow's DBS provider VOOM wants its INHD, and it doesn't think In Demand is playing fair. So, it's taken its case to the FCC, filing a program access complaint Fri against In Demand, whose shareholders include Comcast, Cox and Time Warner Cable. The complaint, first reported by Satellite Business News, claims In Demand has refused to negotiate a "commercially reasonable agreement" with VOOM for the carriage of INHD and INHD2. "We are confident that our pricing policies are consistent with the FCC and all other rules," In Demand said in a statement Mon. "The allegations contained in Rainbow's complaint are completely without merit. We will defend the complaint vigorously at the FCC and have every confidence that the FCC will find our policies consistent with all FCC rules and regulations." VOOM claims that in Sept '03 In Demand offered a fee based upon a minimum number of subs that would have worked out to $3.84/sub based upon the DBS provider's current subscription numbers. At a Sept '04 meeting, In Demand informed VOOM that it had ignored the company's counterproposal because it did not contain minimum subscriber guarantees, the complaint said. "ID made plain that its offer was on a 'take it or leave it' basis," VOOM told the FCC. VOOM doesn't believe In Demand has made minimum sub guarantees of any other operator. Worth noting that during these initial negotiations, VOOM projected its sub count would be at 300K by year-end. As of 2Q '04, it had netted 25K. Dark Side: We couldn't help but remember back to a Media Institute lunch a few years back that Rainbow DBS head Chuck Dolan spoke at, where he declared program access rules were bad for cable. "At Cablevision we spend tens, if not hundreds, of millions developing original programming for our customers. Yet, under current regulations we are forced to share much of that programming directly with our competitors."
 
vurbano

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Finally some news on INHD. Why havent we heard anything about this from the Voom people that visit here? We have to get updates from a news article?
 
Scott Greczkowski

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My bad...

I should have posted this the other day, I read it in one of the publications I get at work. Sorry about that. :(
 
D

Dvlos

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Maybe because we DONT have INHD they haven't said anything. Apparently if Dolan is forced to share his content, then InHD has no clause to deny other providers, then whats the deal with HDNet.. heh... I like Voom they are like these savage natives running around to everyone's office chucking spears hoping to strike gold.
 
Neutron

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If Voom gets InHD then this may force E* and D* to get it.
 
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Sean Mota

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This all point to what INHD has been saying all along "Cable ONLY". INHD is looking for every excuse to not sell to DBS providers. Why hasn't E* or D* gotten INHD in their system? They certainly have the subscribership. Eventually INHD will have to oblige and give access to everyone at a fair and reasonable price. The same will happen with VOOM's 21 exclusives should someone request them. INHD is just buying time since INHD has been the response to HDNET of DBS. At least this is how Mark Cuban looks at it.

The only problem with INHD is that by the time it is on DBS it may not be worth the money. Cable could easily pull out the money that they are pouring into it and no more good programming.

Dvlos, Scott stated the reason for HDNET already. I'll try to get you the link to that post.
 
D

Dvlos

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Cable isn't going to pull out their money on INHD, they may have something to bargain for cheaper rates though in the future "Hey our exclusivity is gone! Knock off .50 a sub!!"
 
jnardone

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From the article it looks like InHD made an offer to VOOM with a minimum charge of $100,000.00 per month for their programming. I can understand this. Why should InHD go through the trouble of setting up with VOOM for any less than that price. This is VOOM's fault for not marketing properly and getting a reasonable number of subscribers.

Remember, VOOM promised us early subscribers INHD in their original advertising and it turns out, despite what they have told us, that they were/are able to provide this channel to us after all - they are just too cheap. Based on the millions they are losing I think it would be worth their while to pay the 100K per month and get us the channel. It can only help them get more subscribers - probably a lot more than if they spent the 100K per month on their current advertising strategy.
 
jnardone

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You know, the more I think about this, the madder I am getting. These channels were promised to me almost a year ago and VOOM has kept saying that the problem was with INHD. The fact is, Cablevision/VOOM told their investors how many subs they expected to have - INHD based their price on that same number of subs and then VOOM wanted to get a different price based on a different number of subs. This was before VOOM even launched - so I would say that VOOM has known all along that it would fail to reach its goal. Anyway, in the meantime, I sent the message below to VOOM demanding that they take INHD's deal and start providing the channels promised.

"Hi:
I just read an article about VOOM's complaint filed with the FCC regarding INHD1 and INHD2. These two channels were listed as available on VOOM when I purchased my system in December 2003 and have never been available to me. VOOM kept saying that INHD would not make them available to VOOM but it turns out that was a lie. From VOOM's own complaint, INHD offered to make the channels available to VOOM but VOOM did not want to pay the price - which according to the complaint was the same price charged to other television providers as long as VOOM had the number of subscribers that it projected in its FTC filings. Apparently VOOM filed false statements with the FTC regarding the number of subscribers that it intended to have by the year's end. Putting that criminal act aside for the moment, I demand that VOOM immediately provide me with the InHD channels since they are in fact available for VOOM to purchase from In Demand."
 
kemguy

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Screw INHD

They want $100,000 to set it up two channels? I'd MUCH rather have Voom spend any money they have on releasing their DVR. DVR is MUCH more important than getting INHD.
 
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rudolpht

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Actually it wasn't promissed to subs. It was found in hidden HTML pages on a pre-release programming schedule, but I don't remember any commitment of InHD to subs. While Cuban can be petulant with "his" HD channels because of non-HD personality conflicts with Dolan (mostly sports related), a consortium approach seems to be a tougher sell. Though the FCC messes up more than it helps (look at the bandwidth waste of locals), it is a rational approach to go there for a little fairness.

If anyone really wants InHD (I have them and NEVER watch them), they can get cable. Free country doesn't mean free everything.
 
jnardone

jnardone

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kemguy said:
They want $100,000 to set it up two channels? I'd MUCH rather have Voom spend any money they have on releasing their DVR. DVR is MUCH more important than getting INHD.

I think it is 100K per month for the programming - and INHD would have to work with VOOM to set it up. I gather that INHD does not want to go through the trouble for less than 100K per month in revenue.

I would not hold my breath on the DVR - VOOM is not developing it themselves - and what company is going to put in a massive effort for an immediate market of 30K subscribers and the promise of additional customers brought in by VOOM's amazing marketing ability.
 
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Walter L.

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jnardone said:
From the article it looks like InHD made an offer to VOOM with a minimum charge of $100,000.00 per month for their programming. I can understand this. Why should InHD go through the trouble of setting up with VOOM for any less than that price. This is VOOM's fault for not marketing properly and getting a reasonable number of subscribers.

Actually, the way that I understand the article is that in Sep 03, inHD offered a deal to VOOM of $3.84 per sub WITHOUT any minimum sub requirement (remember at that time VOOM didn't have any sub since it hasn't started business). Then in Sep 04, VOOM did a counter-offer and inHD didn't accept because they now wanted minimum sub guarantees. So basically VOOM is claiming that inHD changed the "rules of the game" and not only that, but also that the "new rule" (minimum subs) is been impossed only to VOOM.
Bottom line: there maybe some merit to VOOM's claim, depending on the FCC rules (which I'm not familiar with). One thing for sure, inHD is making it difficult because they want to to keep the "Only on Cable" in their logo ;)
 
jnardone

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Hi:
The article says "VOOM claims that in Sept '03 In Demand offered a fee based upon a minimum number of subs that would have worked out to $3.84/sub based upon the DBS provider's current subscription numbers."

A fee is usually an set amount. Since VOOM was projecting to have 200K subscribers you can see how the deal might have been $100K per month for up to 200K subscribers and say $0.40 (or whatever they charge cable co's) per month for each additional subscriber. That way INHD covers it's fixed costs for setting up a new customer. There is nothing wrong with INHD wanting to cover itself in case VOOM failed to produce the projected number of subs - the only way it would be a violation was if they allow other small customers a lower minimum monthly fee - which they say they don't.

INHD has nothing to gain by not selling their programming. What shareholder value is there is being able to put "only on cable" on your logo as opposed to the shareholder value in the additional revenue.
 
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Walter L.

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jnardone said:
INHD has nothing to gain by not selling their programming. What shareholder value is there is being able to put "only on cable" on your logo as opposed to the shareholder value in the additional revenue.
inHD shareholders are 3 cable companies (Comcast, Cox and Time Warner). Obviously, they get a better ROI by keeping inHD "only on cable" ;)
 
DarrellP

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rudolpht said:
If anyone really wants InHD (I have them and NEVER watch them), they can get cable.
I can't. I get everything that's available digitally OTA from the Portland DMA, but my cable company is so far back in the woods, I doubt they'll ever have HD. Now I know how people feel when they want DBS to carry HD locals. ;)
 
jnardone

jnardone

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Walter L. said:
inHD shareholders are 3 cable companies (Comcast, Cox and Time Warner). Obviously, they get a better ROI by keeping inHD "only on cable" ;)

Those are public companies. How do they get a better ROI by not selling INHD programming?
 
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Walter L.

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jnardone said:
Those are public companies. How do they get a better ROI by not selling INHD programming?
I'm surprised you asked because the answer is obvious. It's called competitive advantage.
 
K

kfried001

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Jan 9, 2004
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jnardone said:
You know, the more I think about this, the madder I am getting. These channels were promised to me almost a year ago and VOOM has kept saying that the problem was with INHD. The fact is, Cablevision/VOOM told their investors how many subs they expected to have - INHD based their price on that same number of subs and then VOOM wanted to get a different price based on a different number of subs. This was before VOOM even launched - so I would say that VOOM has known all along that it would fail to reach its goal. Anyway, in the meantime, I sent the message below to VOOM demanding that they take INHD's deal and start providing the channels promised.

"Hi:
I just read an article about VOOM's complaint filed with the FCC regarding INHD1 and INHD2. These two channels were listed as available on VOOM when I purchased my system in December 2003 and have never been available to me. VOOM kept saying that INHD would not make them available to VOOM but it turns out that was a lie. From VOOM's own complaint, INHD offered to make the channels available to VOOM but VOOM did not want to pay the price - which according to the complaint was the same price charged to other television providers as long as VOOM had the number of subscribers that it projected in its FTC filings. Apparently VOOM filed false statements with the FTC regarding the number of subscribers that it intended to have by the year's end. Putting that criminal act aside for the moment, I demand that VOOM immediately provide me with the InHD channels since they are in fact available for VOOM to purchase from In Demand."
Don't think about then. Acutally it would be nice to get Inhd1 and Inhd2. I just got HD cable from Cox and it has those two channels, but HD on Cox is really poor. It is like HD on the Atkins diet. The HD channels to not compare to VOOM at all. The digital SD's look very good though. The channels that do look the best are Discover Theater and Inhd1&2; but I could only imagine what inhd1&2 would look like on Voom. If these channels aren't any good, I am going to drop Cox. I got it because of Discovery TImes, DIscovery Science, National Geo, History International, Nicktoons, Nick GAS, Noggin, WAM, StarzKids, OuterMax and 5StarMax. If they aren't any good I will use Direct to get these.

Voom, it would be a nice add to the line!
 
K

kfried001

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Jan 9, 2004
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rudolpht said:
Actually it wasn't promissed to subs. It was found in hidden HTML pages on a pre-release programming schedule, but I don't remember any commitment of InHD to subs. While Cuban can be petulant with "his" HD channels because of non-HD personality conflicts with Dolan (mostly sports related), a consortium approach seems to be a tougher sell. Though the FCC messes up more than it helps (look at the bandwidth waste of locals), it is a rational approach to go there for a little fairness.

If anyone really wants InHD (I have them and NEVER watch them), they can get cable. Free country doesn't mean free everything.
I believe they were on the original Voom brochures at Sears. You might want to check that out.
 

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