During my speech at the NAB convention in April, I expressed my view that the future of TV is empathically not “TV Everywhere”, referring to the cross-platform concept promoted by major Cable MSOs which is 1/3 hype, 1/3 bombast, and 1/3 fantasy.
Here comes more testimony to support that assertion.
Yesterday, Frost and Sullivan analyst Dan Rayburn ripped the slick packaging off the TV Everywhere concept and exposed it as a charade. The trigger for Rayburn’s commentary was the announcement over the weekend by Comcast that they will raise rates for the second time in a year to cover the cost of their new digital services.
What’s the issue? Consumers are unwilling to pay for the Fancast Xfinity service in its current form. As Rayburn explains “The entire reason why Comcast doesn’t charge a monthly fee for Fancast XFinity TV is because they know they won’t get enough people to pay to cover the cost of the service. So instead they raise rates even for those who don’t even use the service.”
Rayburn says: “If the service was popular and considered valuable, then consumers would pay for it and it would be a profitable business, but that’s not going to happen with TV Everywhere.”
Moreover, Rayburn asserts that “very few MSOs are going to be in a position to offer TV Everywhere services,” pointing out that 17 of the top 25 MSOs in the United States have less than 1M subscribers each. The economics of TV Everywhere simply don’t work for an MSO of that size.
Check it out. It’s worthwhile reading Dan’s blog: