Take My Money, HBO!

[Temis the Vorta]

Love it!

See? We don't want to be pirates...but you're just charging too damn much, you greedheads!

(I'm not a pirate btw, that was a rhetorical flourish.)

But HBO has brushed off the olive branch with a tweet.

Would you be willing to pay $12 per month for Game of Thrones? I did the math on my Netflix rental and realized I'm getting it for $2.50/month (assuming one season = three months). There's cheap and then there's cheap. And then there's me.

 

[ALF]

Sounds like a general lack of common cents. :P

 

[the G-man]

Is it possible that HBO has legal prohibitions on providing content in this manner?

Perhaps their contracts with cable companies prohibit them from bypassing the cable subscription model.

After all, a streaming service is arguably a different medium than cable TV. I could see, for example, Time Warner or Cablevision taking extreme umbrage at HBO poaching their potential subscribers by providing streaming outside of their existing (cable company partnered) subscribers.

And even if the contracts don't prohibit it, I could see HBO not wanting to risk alienating cable companies by doing it.

 

[LitmusDragon]

^ I read that post in your avatar's voice.

I actually re-subbed to cable again recently, I had told myself when I cancelled it that I would buy the season sets and not pirate anything but it turned out to be too hard to resist the temptation. Too many currently airing shows that I'm invested in.

 

[Kirkman1987]

This is why I don't have cable. I hate paying high rates for a handful of channels and shows I'm interested in and hundreds of channels of crap. I save money just watching netflix and getting the new episodes of the few shows I watch off amazon or zune.

On the other hand, I'm a boxing fan and it's almost impossible to follow unless you have an insane cable package. Wish HBO had their boxing PPVs available online or via an xbox app like UFC has done.

 

[Sci]

Sounds like a general lack of common cents. :P

More comment cents, actually. They know that if they offer individual shows for streaming, they'll lose a lot of subscribers who only subscribe for one or two shows, and their revenue will go down.

 

[Harvey]

In that case, they should be able to offer streaming services for the same price as subscriptions without losing revenue. But, they're not doing that, suggesting other factors at work (such as HBO's deal with cable companies).

 

[CaptainCanada]

There was an article on this on the AV Club a week or two ago. Most likely HBO knows that the cable companies would treat announcing such a service as a declaration of war and compromise it being included in packages. It's kind of caught between short-term and long-term needs.

 

[{ Emilia }]

As a European I'd already be happy with Netflix taking my money.

 

[TheBrew]

Copy-pasta'd from another commenting site:

You actually don't want this. Please allow me to explain.

HBO is shielded from the market by long-term contracts with major cable providers. It's remarkably stable, and can therefore take large and expensive risks with its programming. This results in fantastic shows, movies, and miniseries. Even if something bombs terribly, they have a stable source of revenue they can rely on for at least a couple years. Sure, they have to make things people can like, but on the whole they can ride out their misses.

If you take away the cable companies HBO will have to start catering to the market. The month-by-month audience will be master. Then their revenue stream isn't protected nearly as well (this is unless everybody's willing to sign on to like 3 year contracts with HBO, but I'm guessing that's not likely.) They will have to play everything more safely so they don't lose their audience. Any big miss could seriously hurt them in lost subscribers. Before you know it they're toning down language and violence to reach a "broader" audience, and investigating really extensive and probably annoying advertising schemes to boost revenue. At which point you've effectively destroyed HBO as we know and love it.

Sad truth is, you have to leave HBO protected by the mega cable companies if you want them to continue making the sophisticated, adult TV that we all love.

I think that this is a good argument against that.

 

[Temis the Vorta]

Where there's smoke, there's fire - the existence of piracy and the willingness of people to offer some money in lieu of piracy because of what, a basic sense of fairness and honesty? strongly suggests that the problem is that HBO is not offering enough in the way of tiered pricing.

The trick is, there has to always be a trade-off, so that each tier is equally attractive to some big group of people. You can't have one tier be the obvious winner, or everyone will cancel their subscriptions and go for that.

The trade-off is money vs. time. Pay more money (HBO subscription) and you get the shows faster. Less money, you have to wait longer (which is what Netflix already offers). Put a tier or two inbetween HBO and Netflix and let everyone decide which trade-off is right for them.

All the tiers in the world won't eliminate piracy, but it will certainly eliminate the excuse that some people might raise, that HBO is not letting them hand over their money in the way they would prefer.

HBO is shielded from the market by long-term contracts with major cable providers. It's remarkably stable, and can therefore take large and expensive risks with its programming.

HBO only reaches a small % of the global population with their programming, especially if you don't count piracy. The potential revenue from this massive audience could make up for the loss of stability from those long-term contracts.

However, this argument does have a point that it would cause financial turmoil for HBO to rock the boat. I think it's short-term turmoil that is inevitable regardless because the long-term pressures on all digital entertainment will force it towards being widely available, highly convenient, and very cheap. The history of consumer adoption of technology tells the same story over and over: people use technology to get exactly what they want, and businesses that don't adapt get left in the dust.

 

[Skellington]

I think they should offer season passes for these things at prices comparable to DVD / Blu-ray prices, or even somewhat higher. Soon enough the physical media of DVD/Blu-ray discs will be redundant and replaced by online streaming anyway, so why not get in on the ground floor and sell lifetime access to the episodes as they air? Speaking for myself, I don't have a subscription service that covers Sky Atlantic, but would have paid good money to see GoT season two as it aired.

 

[Temis the Vorta]

Vulture article has an interesting quote.

Another HBO exec, Bill Nelson, hinted the company is open to change. “Let’s assume that in ten years’ time there has been a significant shift away from multichannel subscriptions,” Nelson said in the Economist article. “In that environment, HBO may reconsider its position.”

It won't be ten years, Bill, and it may happen faster than you can react to. Just ask the music biz.

HBO should do what the military does - wargame out various scenarios so that they can recognize when things are changing fast, and have a plan for reacting swiftly.

 

[Professor Zoom]

Where there's smoke, there's fire - the existence of piracy and the willingness of people to offer some money in lieu of piracy because of what, a basic sense of fairness and honesty? strongly suggests that the problem is that HBO is not offering enough in the way of tiered pricing.

How much money do they lose to piracy though? They might be quite comfortable losing a little to piracy for the security of subscription. Cost of doing business.

 

[sidious618]

HBO is smart. If they're saying something isn't going to work then it isn't going to work.

 

[the G-man]

Vulture article has an interesting quote.

Another HBO exec, Bill Nelson, hinted the company is open to change. “Let’s assume that in ten years’ time there has been a significant shift away from multichannel subscriptions,” Nelson said in the Economist article. “In that environment, HBO may reconsider its position.”

It won't be ten years, Bill, and it may happen faster than you can react to. Just ask the music biz.

HBO already sells shows in iTunes. Clearly, then, they have some other reason they don't "take [our] money" at this time. I think the speculation it would ruin their relationship with the cable companies and cost a major profit loss is likely the correct one.

 

[Temis the Vorta]

Yeah. I finding that again and again - the only impediment to a big, sweeping changeover in how digital media is distributed and consumed is that somebody is afraid of pissing off somebody who has a lot of clout. It's a classic trade-off between short term and long term concerns.

 

[the G-man]

You're forgetting however that HBO isn't just original series. It's showing movies, etc. HBO may have more of its profit derived from showing movies on cable. If it were to sever its ties with the cable company there is a good chance it might not make any profit, short or long term.

 

[Robert Maxwell]

Vulture article has an interesting quote.

Another HBO exec, Bill Nelson, hinted the company is open to change. “Let’s assume that in ten years’ time there has been a significant shift away from multichannel subscriptions,” Nelson said in the Economist article. “In that environment, HBO may reconsider its position.”

It won't be ten years, Bill, and it may happen faster than you can react to. Just ask the music biz.

HBO should do what the military does - wargame out various scenarios so that they can recognize when things are changing fast, and have a plan for reacting swiftly.

How do you know they don't do this?

You are also assuming that HBO can just easily walk away from its cable contracts, which it most likely cannot. The bit TheBrew posted makes a lot of sense. HBO may have to shift gears if and when the premium cable TV market tanks--but they have no reason to do that if the market stays solid.

Sounds to me like the money lost to downloading isn't enough to make a switch to a more direct subscription model financially viable. It would be naive to think HBO hasn't run the numbers on that, too.

 

[Dream]

Sounds to me like the money lost to downloading isn't enough to make a switch to a more direct subscription model financially viable. It would be naive to think HBO hasn't run the numbers on that, too.

Game of Thrones is the most pirated/downloaded show on the internet, but its ratings keep going up and up. The season two finale was its biggest yet. It makes a lot of money overseas and from dvd sales too. The trend seems to be that cable show ratings keep going up while network show ratings have gone way down.

HBO has zero reason to change anything right now. They are fine with the subscription model.