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<blockquote data-quote="RonJohn" data-source="post: 997167" data-attributes="member: 2426"><p>The biggest issue with streaming direct to consumer replacing cable has to do with bundling. At the moment, the majority of ESPN's revenue comes from cable (and YTTV/etc) subscriptions. I'm not sure what the numbers are at the moment, but the last estimates I saw it was still well over 70% of ESPN's revenue. ESPN forces cable (and YTTV/etc) to include ESPN in the lowest package. (other than local only gov regulated package) I have read estimates that only 30% of subscribers watch ESPN. That means that almost 50% (70% x 70%) of ESPN's revenue comes from people who do not ever watch their content. I have seen very old estimates that put the main channel ESPN at $8 to $9 per month per subscriber. If you have a higher package, then the cable company is already paying ESPN around $15 for the ESPN set of channels. For ESPN to get the same revenue from direct streaming, each sports watching subscriber would have to pay around $45 per month per subscriber with no sharing accounts. All of the subscribers would have to keep the subscription all year long, instead of adding/dropping for the seasons they are interested in. Any discounts for yearly subscriptions would directly deduct from matching their current revenue. If they want to provide a yearly discount, then they would have to set the price at $60 per month and provide a $500 per year "discounted" rate in order to not have a drop in revenue. (All of those prices are based on old estimates of ESPN's carriage fees and revenue. They are not exact numbers, just in the general ballpark)</p><p></p><p>If you want a streaming service that only includes GT content, then it could be less expensive. However, what is GT content? Would such a streaming service include last year's game at Ole Miss? Would it include this year's game in Athens? GT(ACC) doesn't own the content when playing at other venues, especially in other conferences. Would I have to subscribe to the mutt's streaming service to watch COFH in Athens? That is something I definitely don't want to do.</p><p></p><p>I am glad that you see that the streaming transition is still in process. There have been people predicting the immediate end of cable subscriptions and a full move to streaming for more than 10 years. There have been people saying for more than 10 years that ESPN doesn't care about cable subscriptions, only streaming and ad revenue for more than 10 years. Yet cable subscriptions still provide a large majority of ESPN's revenue. Subscriptions still matter greatly to ESPN, and especially subscribers who have no intention of watching sports ever. The numbers are hidden behind a "cable" rate, and most people don't know what they are paying for different content. The transition from traditional cable to things like YTTV is happening, but the only real difference in those is the method of transmission. The business model is still almost the same. The transition to paying to stream only what you want would take a lot longer. I have been saying 5-10 years for a long time, and it still looks to be that far out. However, I don't think we will ever get to streaming "only what you want to pay for" ever. The content is owned by large companies that have lots of content. You won't get to stream only Marvels movies for a low cost, you will have to pay for an expensive Disney package that includes Star Wars, Disney, etc.</p></blockquote><p></p>
[QUOTE="RonJohn, post: 997167, member: 2426"] The biggest issue with streaming direct to consumer replacing cable has to do with bundling. At the moment, the majority of ESPN's revenue comes from cable (and YTTV/etc) subscriptions. I'm not sure what the numbers are at the moment, but the last estimates I saw it was still well over 70% of ESPN's revenue. ESPN forces cable (and YTTV/etc) to include ESPN in the lowest package. (other than local only gov regulated package) I have read estimates that only 30% of subscribers watch ESPN. That means that almost 50% (70% x 70%) of ESPN's revenue comes from people who do not ever watch their content. I have seen very old estimates that put the main channel ESPN at $8 to $9 per month per subscriber. If you have a higher package, then the cable company is already paying ESPN around $15 for the ESPN set of channels. For ESPN to get the same revenue from direct streaming, each sports watching subscriber would have to pay around $45 per month per subscriber with no sharing accounts. All of the subscribers would have to keep the subscription all year long, instead of adding/dropping for the seasons they are interested in. Any discounts for yearly subscriptions would directly deduct from matching their current revenue. If they want to provide a yearly discount, then they would have to set the price at $60 per month and provide a $500 per year "discounted" rate in order to not have a drop in revenue. (All of those prices are based on old estimates of ESPN's carriage fees and revenue. They are not exact numbers, just in the general ballpark) If you want a streaming service that only includes GT content, then it could be less expensive. However, what is GT content? Would such a streaming service include last year's game at Ole Miss? Would it include this year's game in Athens? GT(ACC) doesn't own the content when playing at other venues, especially in other conferences. Would I have to subscribe to the mutt's streaming service to watch COFH in Athens? That is something I definitely don't want to do. I am glad that you see that the streaming transition is still in process. There have been people predicting the immediate end of cable subscriptions and a full move to streaming for more than 10 years. There have been people saying for more than 10 years that ESPN doesn't care about cable subscriptions, only streaming and ad revenue for more than 10 years. Yet cable subscriptions still provide a large majority of ESPN's revenue. Subscriptions still matter greatly to ESPN, and especially subscribers who have no intention of watching sports ever. The numbers are hidden behind a "cable" rate, and most people don't know what they are paying for different content. The transition from traditional cable to things like YTTV is happening, but the only real difference in those is the method of transmission. The business model is still almost the same. The transition to paying to stream only what you want would take a lot longer. I have been saying 5-10 years for a long time, and it still looks to be that far out. However, I don't think we will ever get to streaming "only what you want to pay for" ever. The content is owned by large companies that have lots of content. You won't get to stream only Marvels movies for a low cost, you will have to pay for an expensive Disney package that includes Star Wars, Disney, etc. [/QUOTE]
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