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NonprayingMantis:
It's only financially beneficial in the very very short term until Sky et al renew contracts (which they do all the time)
You're right that it's not sustainable, but it's not as short term as you thin. Sky don't really have any bargaining power to negotiate lower fees. Sky's customer base is still growing (or at least it was as at 31 Dec 2013), and the studios are still not 'officially' selling to anyone else in the NZ regions.
Additional to this, Sky has made a huge investment in a content delivery network that they want to protect. This means that rights holders can actually charge Sky even more of a premium, knowing that newer delivery mechanisms (ie. the internet) significantly lower the barriers to entry of competitors. Sky want to maintain a monopoly position, and will pay to do so. Once they start to lose exclusive content rights, the critical mass of content they have disappears and so does they customer base (and their business). The studios know this, but they also know, that unless Sky finds some kind of leverage, they can just maintain those premiums.
At some point tho, too many people will move to Netflix like services and Sky will simply no longer have the subscriber base to afford the premiums. Until we get to this point, nothing much will change.
The assertion that the studios will do something about Netflix et al is flawed in that taking action hurts them more than not taking action. Blocking Netflix doesn't mean that those subscribers will then go back to Sky. While some of them might, many would either just choose to live without it, or would turn to piracy. This is bad for the studios because they have less net customers.
A move like this may stem the flow in the short term - but studios are also conscious of the longer term effects of this, such as increasing piracy and the negative press they get when they are seen to flex their muscles to detriment of consumers - much like we are seeing for Sky now.
Even if the studios are getting paid per subscriber by Netflix - which I don't think they are (let's say 50% goes on content, so about $4 per subscriber) they will getting a shed load more from Sky per subscriber ($200m content, 800k subscribers equates to $25 per sub on content). So everybody that switches from Sky to Netflix is a huge net loss for the studios.
They'd much rather protect their geographic price model which is raking them in billions every year than collect the extra revenue from 20-30k extra Netflix subscribers
The studios are smart in that they don't directly charge per subscriber, but certainly factor that into their fixed charged. For example, Sky NZ pays less for a season of Game of Thrones because it has less subscribers than say, Foxtel or Netflix who pay more. However, if Sky's customer base decreases by, say 10%, they aren't likely a corresponding reduction in the cost of the next season. The studios just have to pretend that other factors that makes up the price have increased, and remind Sky that there are others who will be willing to pay pretty much the same amount to take those exclusive rights off them if they don't want them. You just have to look at PremierLeaguePass to see this is a reality for Sky they want to avoid.
On the other hand, they can say to Netflix, oh your subscriber base is bigger now, so the next season is going to cost you more.
Your point b) in the second section makes no sense at all. They only concede the exclusivity doesn't exist if they take no action and continue to allow Netflix free reign in areas they haven't paid for. By doing nothing, it gives Sky/TVNZ etc huge leverage when it comes to renegotiating content deals. "We'll only pay you for exclusivity if you uphold your end and stop Netflix from selling here willy nilly"
Again, it doesn't actually give Sky much leverage at all. Sky has a vested interest in exclusivity - more so than studios. Sure, studios can squeeze more when there are exclusive deals, but their business model doesn't fully depend on it. Sky's does. For this reason, the studios can maintain exclusivity premiums for the next little while, simply because those paying them have no choice. By not officially giving the nod to Netflix, but allowing it to exist as a smaller sub-market, they can wash their hands of the problem, or even put it back on Sky et al (as they seem to be doing) by saying 'It's not our job to enforce your exclusive rights - it's yours'.
Again, this can't/wont last forever, but the position they are in right now means the studios get away with this. The fundamentals of the market are changing, and will force a change in the business models of studios and providers in due course - but we aren't there yet.
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