Then Again...
TDG's Weekly News Wrap & Commentary
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Hulu’s Live TV increases in price for second time in 2019
Précis
– Disney
raised the monthly cost of the Hulu Live TV
service to $55/month, up $10. This is on top of a $5/month increase earlier this year. In other words, if you started the year paying $40/month for Hulu Live TV, you are now paying almost 40% more for the same service.
TDG – Hulu joins the long list of vMVPDs that have increased their monthly prices in the last year, including YouTube ($50), AT&T TV Now ($65), and Fubo TV ($55). Only Sling TV avoided price increases this year, largely because it does not include the Big-4 broadcasters. Even Philo dropped its lowest tier (now offering only a $20/month option) and Sony is shutting down its service in January.
In late 2017, TDG stated that 1) the vMVPD business model would prove unsustainable for all but the largest tech-media firms (those with deep pockets and the patience to wait around as others ate their young); 2) cost pressures would be intense; and 3) over time the surviving vMVPDs would see their prices rise at least to the entry tiers of legacy counterparts.
Pricing pressures, we predicted, would become more acute because of the diminishing value of live programming—all but sports and, to some extent, news. No, live TV is not dead—that’s hyperbole—but its value will continue to diminish even as costs increase. This dynamic creates a window of opportunity for truly customizable app-based aggregation services that combine some live but mostly on-demand programming (i.e., Pay-TV 3.0 aggregators that embrace service toggling or “spinning”). As TDG first proclaimed in 2012, the future of TV is an app. In 2019, we are re-characterizing this just a bit. The future of TV is an app aggregator that gathers a la carte selections, enabling users to toggle between app subscriptions as needed, keeping a few bedrock services (e.g., Netflix) and cancelling others (e.g., Hulu on-demand).
Note: This week Disney’s DTC chairman, Kevin Mayer, said that the
company is considering
a skinnier live TV service at a lower price. That’s likely a good idea at this point.
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Altitude sues Comcast for antitrust violations
Précis
– Independent RSN Altitude Sports, which carries professional basketball, hockey, and soccer in Colorado,
filed suit against Comcast
, alleging that the behemoth is trying to force Altitude out of business so it can expand its RSN empire.
TDG – We first discussed the blackout of Altitude in early October, as it threatened to keep fans in Colorado from viewing season openers of the Nuggets and Avalanche. During that time, Altitude was able to renew carriage with DirecTV but not Dish Network. So why isn’t Altitude also suing Dish Network? That may end up happening, but not because of antitrust concerns. Keep in mind that Dish doesn’t own any RSNs, while Comcast owns multiple outlets. Altitude contends that none of the Comcast-owned RSNs were asked to decrease their fees, suggesting that Altitude was targeted by Comcast (at least this is the claim).
I’m tired of writing about retransmission disputes (18 years and counting), but in these times they are especially problematic for independent networks without the leverage needed to keep the wolves at bay.
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DOJ aiming to reverse Paramount Consent Decrees
TDG – In a move aimed at rolling back perceived archaic antitrust regulations, the DOJ argues that one of the areas where federal protections are no longer needed is in the film industry. SCOTUS ruled in 1948 that several major studios “engaged in a conspiracy to control the motion picture industry through their ownership of (both) film distribution and exhibition.” The decision forced studios to divest their theatres, among other items. Today, these rules are still in effect, and the DOJ contends that new competitive pressures (e.g., SVOD services) require that exhibitors innovate in order to compete effectively. Innovation, in this case, appears to require lifting these requirements. This assumes that the “horizontal conspiracy” that originally justified these decrees no longer exists. In other words, the theatre industry and consumers in general would be better off if it were more consolidated; if studios were allowed to own the theatres in which their films are exhibited.
While this is hardly surprising—both major political parties have sanctioned greater consolidation of multiple industries under the guise of “innovation”—the assertion that consumers would be better off with studio-owned theatres is far from convincing.
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Recent & Upcoming Reports
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Cogitations
Per this morning's
Washington Post
, Ambassador Gordon Sondland’s role in the Ukraine escapade, as described by Dr. Fiona Hill, rekindled a famous exchange in
Apocalypse Now
:
Captain Willard (Martin Sheen): “They told me that you had gone totally insane and that your methods were unsound.”
Colonel Kurtz (Marlon Brando): Are you an assassin?”
Willard: “I’m a soldier.”
Kurtz: “You’re neither. You’re an errand boy sent by grocery clerks to collect a bill.”
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