
Cable Cost are going High - huzail923
http://biz.edesktopworld.com/?p=1564&sms_ss=hackernews
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josefresco
"Most people view their broadcast networks as if they’re a God-given right,
but they cost money to produce, said SNL Kagan’s Flynn. Somebody has to pay
it’s not going to stay on Hulu forever for free."

The advertisers pay for it douche-bag. Oh wait, you want us _and_ them to pay
for it several times over to boost your failing business model. Sounds
familiar.

~~~
qeorge
Wrong. Cable companies pay for content, and recoup their money (+profit)
through a combination of subscriptions and advertising. The cable gets ~$1200
+ advertising revenue per customer per year, and from this pool they can buy
content from content producers like NBC, Viacom, etc.

Now consider that Google makes about $40/user/year off ads. Even if Hulu made
as much money per user per year as Google, they'd still be making < 5% of what
Time Warner Cable makes per user per year, selling arguably the same content.

So as cable TV subscribers are replaced by lower-value internet TV viewers we
should expect the total amount of money available to buy content to decrease
rapidly. Consequently, there will be less money available to produce said
content.

So when Kagan says _"Somebody has to pay. It’s not going to stay on Hulu
forever for free"_ she's exactly correct.

Whether or not that matters is another discussion.

~~~
chrisbolt
But Time Warner Cable has much higher costs per user since they have to build
the infrastructure to get to those users, whereas Hulu can take advantage of
the fact that users pay for most of the infrastructure to get to Hulu (and
they may even be paying Time Warner Cable).

~~~
qeorge
In 2008, TWC spent roughly $1 billion on video content and only $33 million on
high-speed data (30x more spent on content). So the infrastructure cost per
subscriber to TWC is negligible.

Also worth noting, TWC made about $2.7 billion off cable TV subscriptions,
compared to $145 million from advertising. So while its true that they do
"double dip", its fair to say that monthly subscriptions are paying the
content bills, not advertising.

Source: TWC's 2008 SEC filing, available here:
[http://files.shareholder.com/downloads/TWC/629188992x0xS9501...](http://files.shareholder.com/downloads/TWC/629188992x0xS950144-09-3639/1377013/filing.pdf)

~~~
thwarted
Then shouldn't cable subscribers be able to get more channels without any
advertising?

~~~
qeorge
I certainly think so, but that's outside the central point of this argument.

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sabat
I wonder if these short-sighted executives realize that today, it's common for
techies to disconnect cable TV service and rely solely on an internet
connection for television. As the techies go, so will go the general populace.

~~~
statenjason
The interface of cable TV is what makes me shy away from it. I've been
bothered with it for years for several reasons.

First, how long does it take to find something you actually want to watch?
I've seen many instances of flipping through a set of ~100 channels in search
of something interesting. However, with frequent ads and no indication of what
is on any given channel, it's easy to miss something worthwhile.

Second, channel numbers hold no significance. Channel #Z means station Y only
through company X in region V. Figuring out the layout when I'm away from home
is not worth my time.

Third, the provided "cable boxes" you can fork out extra money for each month
are a poor excuse to improve the cable tv experience. Yes, they show what's on
each channel, but paging only ten out of hundreds (including those you don't
receive). What about a decent search feature? Some have a search, but input
with a standard remote is awful. Include something with a QWERTY.
Finally,they're slow. Waiting multiple seconds for every action should not be
a common occurrence in this decade.

When the average Joe starts realizing these issues they've put up with for
years, I have no doubt they'll follow the techies.

