HBO is owned by Time Warner. That's why they say these crazy things and make their content so hard for people to view. Time Warner wants to protect their cable business at all costs.
If HBO were independent you wouldn't see these stupid comments. It's in HBO's best interests to get their content seen by as many people as possible. That, however, is not in the best interest of Time Warner.
Time Warner Cable is actually not owned by Time Warner, which is exclusively (or getting there) a content company.
The issue here is actually that the cable companies (TWC included, now as one of many clients of Time Warner's) provide huge dollars in a lump sum kind of way. The internet is still not a proven business model for distributing shows profitably.
While I agree with others in this thread that an a la carte model is the correct one and would likely work, there is very little middle ground for them (HBO, TW etc.) in between selling their shows to cable companies and going completely independent and distributing through the internet. As soon as they start doing that the cable companies will stop paying for their shows, and then at best there will be a long period of time while people switch over to consuming everything over the internet. Imagine how long it's going to take IE8 to disappear due to the fact that you can't upgrade to IE9+ w/o Vista+. Now imagine the upgrade I have to do is swapping out a cable box for a computer. Will you survive that gap, or will cable companies, wanting to continue to capitalize on the networks they've built, simply replace your content with someone else's?
This doesn't sound right. Shady sites that do nothing but provide ads for illegal downloads (e.g. megaupload) make tons of freakin' money and its not even legit. The problem seems like they half ass this stuff.
I mean if they're going to charge me $5 to watch a mediocre movie i'm going to pay them precisely $0 a week. If they charge me $1 to watch a movie I will probably watch 5 movies a week which gets them 5 of my bucks. They just need to go all in and stop messing around.
To clarify, the issue isn't so much that it won't work at all, it's that you won't get good vide quality over a slower connection. For instance, I'm traveling for a week, and will have hotel wifi. Game of Thrones will look pixelated on my third-gen iPad. That's not exactly the kind of experience I'm looking for.
In contrast, I purchased the latest episode of Sherlock in 1080p for this trip. It looks amazing on the iPad, and I'll be able to watch it on the plane or anywhere else.
If this thread is still active, I'll report back tonight on how HBO Go works on my hotel's wifi. If HBO Go would just let me cache a few shows this wouldn't be an issue.
And forget about watching any of these episodes on my plane flight.
Maybe I'm asking too much from an app with Go in the name.
I am 25 years old. I have never paid for cable and I have numerous shows that I enjoy. I would GLADLY pay to watch some of my favourite shows, Game of Thrones included. However, as I currently reside in Canada, I can't even watch Hulu - Netflix Canada sucks. I have money; your show is not attainable through monetary means and I will not purchase cable. What is a fella to do?
Oh yes. I agree. And I have suffered to set up an american PayPal account just so I could pay for media services which restrict access based on where your PayPal account is (IMHO, they should not even be able to get this information, but I digress). Then PayPal found out and basically blocked my account, along with the little amount of funds it had.
It is just crazy how many conditions they impose instead of just taking my money, then complain when people who are less patient than me just go ahead and pirate the damn thing.
Pay -> Watch replaces hundreds of network heads getting tremendous managerial salaries with a few web developers. Not easy, because the people who make the calls are the ones who no longer have purpose in the business, and thus they are trying to bring everyone else down on their sinking ship.
The only real solution is for companies like Netflix to fund the development of shows themselves. Until the IP is in Netflix's hands, things will never change. But once the people actually making the shows see that Netflix is a viable avenue for their content, a sea change will begin.
Well, I'm excited about the upcoming Netflix-exclusive Arrested Development season. There's a huge fanbase and it should be a good indicator for how successful an approach like this can be. On the other hand, I'm from germany and that, of course, means that I'll will have to get the show from somewhere else.
If actors could organize, we could easily see a transition to kick-starter like funding of film and television productions (fund per episode?) that when funded is just publicly distributed via torrents. Absolutely 0 middle men, no costs of distribution at all (unless you count the guy who pays for an internet connection to do the first bout of seeding the episode) and it properly fits into how the pay per unit model fails in digital media.
I don't buy bread. I have sandwiches that I would like to make, but I can't eat a whole loaf before it goes bad, so I don't buy it. I would gladly buy half a loaf, but my grocery store doesn't sell half loaves. If they won't make a half loaf to suit my needs and what I want to pay, I should just be able to steal whole loaves?
The grocery store will not sell half a loaf because they cannot figure out how to keep them fresh enough to sell them. They don't try hard to sell half a loaf and they basically tell the public to accept whole loaves as a fait accompli.
A the growing demand for half loaves meets a innovative group of people who found a way to deliver fresh half loaves to people. They sell them on the city streets -- without a license -- near the grocery store. Customers are happy again.
The grocery store finds out they have been losing revenues to the street dealers and the engineering efforts they developed for delivery are based on knowledge in the public domain. Instead of using this knowledge to serve their customers the fresh half loaves they want, they try to stop the street dealers from selling because they operate without a business license.
More like; I buy a loaf of bread and I am never around to eat it. The whole loaf goes mouldy so I don't buy it. My friend gives me a piece of bread when I want it at 12 am, I would GLADLY pay for it but he doesn't accept money and he only complains.
Actually he is literally comparing bread to piracy. It would be a literal comparison to apples and oranges if he had, literally, compared apples and oranges. "Literal" means "just as the text says it", not "definitely". "Literal" means it is exactly as it is written, it is not an exaggeration, expression, allegory, or analogy; it LITERALLY happened, meaning it happened EXACTLY AS WRITTEN.
You probably meant "definitely" or "certainly" comparing "apples to oranges". It's an expression, it's not literal unless he LITERALLY was comparing apples and oranges, where an apple is a fruit from an apple tree, and an orange is a fruit from an orange tree. Such a comparison may sound like "most apples are red and fat around the middle, most oranges are orange and evenly round".
That analogy doesn't hold. You could always freeze half the loaf when you get it. It's not the same with cable TV.
A better analogy would be that you wanted to buy a loaf of bread, but the grocery store forced you to also buy hot dog and hamburger buns with it along with some bagels. Say you're a vegetarian or don't like hot dogs or hamburgers, and you'll never use them, but you have to buy them anyway.
That's even worse than the original analogy. No one is stopping you from going home and "making your own loaf" (I guess that would be shooting your own version of Game of Thrones? Ok, so actually someone would stop you, at least if you tried to share it.)
Something that often annoys me about the "piracy" debate is that the debate is very difficult to have, since there is very little to compare it to. No, it's not like stealing a car, but it's also not like making bread from scratch, and it's also not quite like sharing a (physical) copy with your friend, or like making a physical copy and handing that around (it's also not really like piracy, which is why I put that word in scare quotes)
I enter all the grocery stores in town to buy a loaf. Every grocer asks to see my passport, i am not american, they say no can do. I ask to pay them extra, they say not an option, i have to wait till the summer to buy my loaf when it's stale. An american customer hands me a loaf, i take it without paying and leave. Nothing is right in this situation.
The problem in Canada is that Bell Media owns the Canadian distribution rights to many of the popular programs that aren't already available via services like Netflix.
Even if everyone in the USA agrees with you, Bell won't. They have far too much money invested in TV broadcasting technologies, and too little tied up in Internet infrastructure. There's no real upside to them providing you the content online, because not only will they'll lose their broadcasting revenue, but you'll fill up their oversubscribed tubes, making their internet services more costly to operate. A token fee for the program isn't going to offset that.
And basically, people who would've otherwise paid that "token fee" instead pirates. The tubes get clogged up either way (after all, if they oversubscribe capacity, it will come back to bite them one way or another).
All i m saying, and i think most people agree, is that their cost/benefit/profit analysis of the situation hinges on the false assumption that consumers have no way of obtaining the content in their own way (via piracy or waht not). and this is increasingly not the case.
Very true, but they can get away with tricks like throttling and caps for illegitimate activities. There will always be some pirates no matter what, but most people are way too busy to concern themselves with jumping through all the hoops. It doesn't matter if the pirate would have given you $10 for content when you made $30 off the person who didn't pirate your content.
I do agree that the time will eventually come, but it is wholly up to the consumers. So long as we continue to fund the TV infrastructure in a big way, there is no incentive for the business to change.
As the article says and as a lot of people including me keep repeating: I would pay practically ANY amount for movies & shows I want to see. I live in the EU and you have to struggle to see shows like Game of Thrones legally (basically, fly to the US or wait forever). That's not an option. Worldwide (!) distribution at the same time (!) for an amount they make a profit on would be fine with me and I know many others. It's not about money; it's about that the world has changed; people have instant worldwide communication (via Facebook for instance) about the unfolding of, for instance, this series, yet the viewing is not worldwide. In the olden days, you didn't know about your friends in the US and what they watched, so you didn't mind waiting a year for a series to get on local tv. Hell, you probably didn't even know the series existed until it aired. As long as this is not changed, people will keep downloading as there is no alternative.
Oh, and why is there no feedback forum/something for these companies. In open discussion they could see what their real audience wants instead of staring at the falling numbers and drawing conclusions from suspected causalities!?
This would be so easy to fix if the network heads weren't so ignorant:
Make a Netflix style distribution system, allow users to subscribe a la carte to a fixed number of channels on a tiered system (i.e. I can select up to 15 channels for $29.99 a month or 30 channels for $59.99 a month), and make it all on demand. The infrastructure is there, the tech wouldn't be that hard to set up, and it would make a BOATLOAD of money for both the networks and the operators.
Honestly, it sounds like an ego game. They don't understand how these things work so they go on the defensive as opposed to learning and improving their business. Sad.
I suspect it's more complicated than that. Netflix is $15 a month, cable subscribers routinely pay $100 or more. And I'd bet that HBO and its properties get a reasonably-sized chunk of that. That "BOATLOAD" has a lot of scaling to do.
The complication is in the hands of the MSO (e.g. Time Warner, Comcast, Cox). That $100 isn't for the content license, it's for the exclusivity contracts in your area. Ever notice how there's only one or two options for a provider in your area? That's because companies like Time Warner physically purchase the rights to the actual cable lines in your area and forbid any other providers from transmitting over them. Your cable bill is for the most part ensuring this exclusivity stays in place. It's a whole lot of bs put in place by a lot of greedy people. Don't be fooled.
All of that is true, but content licenses are, in fact, a very large portion of that bill. This hastily googled link (i.e. I didn't finish reading it) claims that HBO gets $7.27 per subscriber. That's full half of Netflix's rates right there, for what, maybe 5% of the per-viewing-hour content delivered?
Here in the Texas area, Verizon's FiOS service is easily $80-100 a month. That's for the base internet + tv package, with no special channels, too. That does not include HBO, or any other movie channel. At one house that I lived at for a year or so, we paid $180 a month for TV + internet, no phone line. That was simply because we wanted HBO and some sports channels, and good internet, with like two extra DVR boxes.
I consider $100 on TV + internet to be pretty average, if not lower average.
Edit: deleted message said something about $100 being way more than he had seen for TV and internet bundles.
The Time Warner CEO (which owns HBO) is on the Charlie Rose show now. One interesting exchange:
"How far off are we from a big movie being released simultaneously in theaters as well as over every platform available? And what will be the model for the release of the movie on the platform?"
"There is a bunch of companies and investors that put up your local multiplex. Lately they've been trying to make the place cleaner, the screens to be crisper, you've got hi-def. And that creates a certain viewer experience to go to the theater and see it that way. So as we think about the fact that can you release simultaneously what happens if you do that, we are all trying to be as thoughtful as we can about doing this in a way that does not undermine the quality of the theater experience. Not take away all the business..."
"You still haven't answered my question."
"Right... so that's one answer... the other answer is if you delay a while to give the theaters a chance to make a long run sell on tickets, what you're doing, and you see it all over the world, is you create gaps for piracy where..."
So there you go.
These guys aren't ignorant, they are maxing out profits. Not everyone is on Hulu yet. This is a really big country and the economics don't make sense for them yet.
He also directly disagreed with the HBO CEO by saying HBO Go "is working" and: "some of the connections where you try to sign on are not as good as they should be and that's what we've got to fix"
The Networks don't want that. ESPN alone commands $5/a month. Don't want that? Disney has blocked all it's other channels - ABC/ABC family, Disney, etc as a huge block - that you MUST get. Want HD? another fee.
Cable is increasingly becoming the have's/have not's.
it would make a BOATLOAD of money for both the networks and the operators.
Only if by "boatload" you mean one of those little toy boats that floats in the bathtub. Last year, NBC, the lowest rated broadcast channel, reported $4.2 billion in ad revenue (which represents a substantial decrease from the year before). At the top end, CBS reported $6.3 billion in ad revenue. (Source: http://adage.com/article/mediaworks/2010-rebound-broadcast-t...)
HBO clocked in at just over $1 billion (estimated, final numbers pending) in revenue for 2011. (http://www.hollywoodreporter.com/news/hbo-top-1-billion-inte...)
In order for a la carte to generate the same amount of revenue for a single broadcast channel, at say, $2/month, NBC alone would need 175 million subscribers, while HBO would need nearly 42 million subscribers (or roughly 1/2 again its current subscriber base).
It's not an ego game, it's basic arithmetic. Internet streaming may be the future, but it won't be the present until it gets a lot more expensive.
They wouldn't have to remove advertising, just become more creative. An easy solution is to keep advertising embedded in the broadcast and offer a premium option where all ads are removed for a greater cost.
You cannot help but laugh at such a comment. This is anecdotal evidence but increasingly I've noticed people connecting their flat screen TV to their computer and use that as their main source of media. And these are people that are not technical in the least.
HBO does not need your money, they do really well selling their subscriptions. HBO's business is based on charging $200/year to subscribers in exchange for exclusive content. By offering a la carte shows at $9.99 or whatever they would be breaking the exclusivity that they sell to their real customers. The pirates' argument seems to be that HBO does not have the right to produce exclusive content for their subscribers, as if access to all entertainment is some fundamental right, it is not.
Here's a hint: paying $9.99 (or $0.99 or $0.01, if that's the price that's set) makes you a real customer. The definition of customer is "someone who exchanged his money for your goods/services"; it does not matter the quantity. All money is equally green.
Exclusivity is another name for rent-seeking. HBO has every right to publish (and not publish) its content in the manner of its choosing, but I don't have to like it.
I bought the Game of Thrones books instead; which I was able to do, at physical and virtual locations, individually or in a boxed set, at a fair and reasonable price, at my leisure. Oh, and I can resell them after I've finished reading them.
You have to realize, HBO's customers are not the subscribers. HBO's customers are cable companies. The cable companies deal with the subscribers and just keep track of how much to pay HBO every month. HBO doesn't even know who the subscribers are! They don't have any identification or billing information. That's why they can't sell to customers directly.
They don't have any identification or billing information. That's why they can't sell to customers directly.
(Shrug) All they have to do is ask. It's as if they don't want to be able to sell directly to their viewers.
Other publishing industries are frantic at the thought of middlemen like Apple and Amazon owning subscriber relationships. Yet HBO and Showtime seem to actively prefer it that way. I don't get it... don't they understand the risks of putting all of their eggs in the cable provider's basket?
> Now, it’s important to note the reason for all this piracy: lack of access to the show for people who can’t afford, or choose not to purchase, a cable-TV subscription.
Which, for the purpose of watching Game of Thrones, includes everybody who does not live in the US (and the UK for Game of Thrones, since it broadcasts on Sky the day after).
That's roughly 6.6 billion people "without cable access" for the purpose of watching GoT, even taking a third of that to account for people who have high-speed internet access and understand spoken english reasonably well you're still talking about a good 2 billion people who can see the series's hype online and have no way to watch the show legally while it is hyped and they can discuss it with other fans.
Not necessarily defending this guy (who I know nothing about) or anything, but I really hate it when somebody's paraphrase is put in quotation marks as if it's a direct quote.
"HBO co-president Eric Kessler has said he thinks the move away from traditional television to an internet-based model is just a fad that will pass – a 'temporary phenomenon' tied to the down economy. "
The only actual quote here is 'temporary phenomenon', which could have all kinds of contexts.
HBO is bound by all kinds of license agreements to the cable providers and that is their bread and butter. They simply cannot provide Internet purchasing of their content. You don't really know what the CEO actually believes because saying the Internet is a fad plays directly into his market (the cable companies).
At this point in time, it might make more economic sense for HBO to ignore the Internet. Although, I certainly hope they're planning for the future. And if they are, it would still be foolish to let the cable companies know that.
I just can't imagine how he could. I can understand him saying this because it makes a lot of business sense considering the company's position, but someone so involved in content delivery cannot possibly believe internet delivery is just a fad. They invested in HBO Go ahead of many of their rivals, so it seems like they actually understand the future, they are just afraid to talk about it now because the rest of the world isn't ready.
My reaction as well. Will the Tv and movie studios learn from the lesson of Napster and iTunes? With stories like these, it doesn't seem likely.
The studios should be hiring engineers and UI folk; not lawyers. Time Warner should buy the Pirate Bay and charge a subscription or download fee while improving the UI. Or simply offer downloads on their website.
College sophomores figured out the distribution model fifteen years ago. This is silly.
My little bit of snopes'ing pulled up an interesting ass covering that Olsen made in reference to this quote, which as time goes on still sounds equally as bad:
> I did make a number of statements and still make statements that people don't understand about computers, or delight in misquoting. A long time ago when the common knowledge was that PCs would run our lives in every detail, I said that if you stole something from the refrigerator at night you didn't want to enter this into the computer so that it would . . . mess up the computer plans for coming meals.
I think certain MBA types totally fail to predict disruptive business trends and that's because they never understand full implications of any thing. This is a problem with anybody who looks things only from a abstract sense.
Like many have mentioned in this thread, People said similar things about computers in the past.
This is why its so important to understand what you are dealing with, every aspect of your business sometime you need to get down to the grass root levels to understand.
Merely 'I can get this job done by hiring techies' doesn't always help all the time.
It seems monopolistic and anti-competitive for a content distribution company to also own a content creation company. The government should get in there and break that shit up. I think HBO would find it quite lucrative to be able to directly sell their content to their customers. When you find yourself in a situation where it's easier to download a show off of bittorrent illegally than it is to get it legitimately from the content creator directly, something is messed up.
I think there is a world market for maybe five computers." -- Thomas Watson, chairman of IBM, 1943.
"Where a calculator on the ENIAC is equipped with 18,000 vacuum tubes and weighs 30 tons, computers in the future may have only 1,000 vacuum tubes and weigh only 1.5 tons." -- Popular Mechanics, 1949
"I have traveled the length and breadth of this country and talked with the best people, and I can assure you that data processing is a fad that won't last out the year." -- The editor in charge of business books for Prentice Hall, 1957.
"But what...is it good for?" -- Engineer at the Advanced Computing Systems Division of IBM, 1968, commenting on the microchip.
"There is no reason anyone would want a computer in their home." -- Ken Olson, president, chairman and founder of Digital Equipment Corp., 1977.
"640K ought to be enough for anybody." -- Attributed to Bill Gates, 1981, but believed to be an urban legend.
"This 'telephone' has too many shortcomings to be seriously considered as a means of communication. The device is inherently of no value to us." -- Western Union internal memo, 1876.
"The Americans have need of the telephone, but we do not. We have plenty of messenger boys." -- Sir William Preece, chief engineer of the British Post Office, 1876.
"The wireless music box has no imaginable commercial value. Who would pay for a message sent to nobody in particular?" -- David Sarnoff's associates in response to his urgings for investment in the radio in the 1920s.
"While theoretically and technically television may be feasible, commercially and financially it is an impossibility." -- Lee DeForest, inventor.
"The concept is interesting and well-formed, but in order to earn better than a 'C', the idea must be feasible." -- A Yale University management professor in response to Fred Smith's paper proposing reliable overnight delivery service. (Smith went on to found Federal Express Corp.)
"Who the hell wants to hear actors talk?" -- H. M. Warner, Warner Brothers, 1927.
"I'm just glad it'll be Clark Gable who's falling on his face and not Gary Cooper." -- Gary Cooper on his decision not to take the leading role in "Gone With the Wind."
"A cookie store is a bad idea. Besides, the market research reports say America likes crispy cookies, not soft and chewy cookies like you make." -- Response to Debbi Fields' idea of starting Mrs. Fields' Cookies.
"We don't like their sound, and guitar music is on the way out." -- Decca Recording Co. rejecting the Beatles, 1962.
"Radio has no future. Heavier-than-air flying machines are impossible. X-rays will prove to be a hoax." -- William Thomson, Lord Kelvin, British scientist, 1899.
"So we went to Atari and said, 'Hey, we've got this amazing thing, even built with some of your parts, and what do you think about funding us? Or we'll give it to you. We just want to do it. Pay our salary, we'll come work for you.' And they said, 'No.' So then we went to Hewlett-Packard, and they said, 'Hey, we don't need you. You haven't got through college yet.'" -- Apple Computer Inc. founder Steve Jobs on attempts to get Atari and HP interested in his and Steve Wozniak's personal computer.
"If I had thought about it, I wouldn't have done the experiment. The literature was full of examples that said you can't do this." -- Spencer Silver on the work that led to the unique adhesives for 3-M "Post-It" Notepads.
"It will be years -- not in my time -- before a woman will become Prime Minister." -- Margaret Thatcher, 1974.