Posted: 1:56 a.m. Monday, Aug. 12, 2013
We’ve been following the argument about the future of pay TV and sports and how things will shake out as prices continue to rise while customers grow frustrated with the higher rates they’re being asked to pay.
Latest indicator: this article about Fox’s prospects.
Fox executive Chase Carey believes that “[p]eople will give up food and a roof over their head before they give up television,” an astounding misreading of basic human intelligence and rational behavior driven by self-interest.
Ad and content sales won’t get the company where it wants to be so the only choice (currently) is to…keep raising rates. But if that drives people away – and many have already left or will be soon – what then?
According to this article, DirecTV and Dish Network may merge – another sign that the industry has some real issues to deal with.
Left unsaid in most of the articles we’ve seen is the competition from the Web. There is plenty of video available, to be sure, from Netflix and Hulu to many other providers, but people are also just finding other ways to entertain themselves. One question Carey might ask is this: if you are forced to choose between paying for TV and Internet, which one will you give up?
He might not like the answer, particularly among the younger, more desirable demographics.
He might also consider what’s happening with radio: as more and more radio becomes available online, normal ratings may decline. We don’t think anyone has yet thought to measure terrestrial and streaming radio together. Take for one example WCPE in Raleigh.
WCPE moved online very early and branded itself theclassicalstation.org. From all appearances, it’s been a big success and has moved WCPE from a local station to, perhaps, the leading online classical resource worldwide.
Disruption is not fun and not easy, at least for those whose business models get shredded, but one way or the other, it’s coming. We’ll see who is ready.