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Benoire
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  #1549533 10-May-2016 21:17
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Depending on how Sky are structured financially as suggested above, if we assume that profit IS only $15 per sub and they don't do much financial wizardry to change that, I suspect without advertising the true cost for the service would be much higher.  I wonder how much the sub would be for NO adverts, compared to what we have now.




ockel
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  #1549535 10-May-2016 21:27

Benoire:

 

Depending on how Sky are structured financially as suggested above, if we assume that profit IS only $15 per sub and they don't do much financial wizardry to change that, I suspect without advertising the true cost for the service would be much higher.  I wonder how much the sub would be for NO adverts, compared to what we have now.

 

 

Advertising comprises only $70m per year (or about $7/sub/mth).  Despite having ~37% of audience share (including Prime) it only gets about 11% of TV advertising share.  Most of Sky's ad's are self-promos across channels.  Feeds direct from Discovery, NatGeo, ESPN etc are not its own inventory and generally not able to be controlled.





Sixth Labour Government - "Vision without Execution is just Hallucination" 


JimmyH
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  #1549536 10-May-2016 21:29
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ockel:

 

 

 

Advertising comprises only $70m per year (or about $7/sub/mth). [...]

 

 

I would be willing to pay another $7/month if it would get rid of all the ads.




rugrat
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  #1549581 11-May-2016 02:29
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JimmyH:

ockel:


 


Advertising comprises only $70m per year (or about $7/sub/mth). [...]



I would be willing to pay another $7/month if it would get rid of all the ads.



I reckon they would gain more subscribers then what they would lose, goodness sakes if it's only $7 to get rid of all the adds/ program interruptions, they should do it.


Benoire
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  #1549591 11-May-2016 06:30
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rugrat:
JimmyH:

 

ockel:

 

 

 

 

 

 

 

Advertising comprises only $70m per year (or about $7/sub/mth). [...]

 

 

 

 

 

 

I would be willing to pay another $7/month if it would get rid of all the ads.

 



I reckon they would gain more subscribers then what they would lose, goodness sakes if it's only $7 to get rid of all the adds/ program interruptions, they should do it.

 

I got the impression from an earlier post that the ads that they generate contribute only $70m but there are the channels they resell (Nat Geo, Discovery, ESPN etc.) that contain their own advertising and they wouldn't be able to do that. Maybe that isn't the case, but its a consideration.

 

If Sky only make a total of $70m from adverts, increasing the subs might be an interesting proposition, but it would have to affect everyone as the timings are padded by the adverts; this might lead to further issues though as American made programs are generally only 40m in length and require advert slots to achieve the full hour time slot... So Sky would have to throw in more content per day...


tdgeek
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  #1549606 11-May-2016 06:57
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rugrat:
JimmyH:

 

ockel:

 

 

 

 

 

 

 

Advertising comprises only $70m per year (or about $7/sub/mth). [...]

 

 

 

 

 

 

I would be willing to pay another $7/month if it would get rid of all the ads.

 



I reckon they would gain more subscribers then what they would lose, goodness sakes if it's only $7 to get rid of all the adds/ program interruptions, they should do it.

 

While they don't gouge, it isn't cheap either. A small decrease in sub wouldn't add any users, a small increase would probably churn some.  


dafman
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  #1549648 11-May-2016 09:32
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tdgeek:

 

 

 

While they don't gouge, it isn't cheap either. A small decrease in sub wouldn't add any users, a small increase would probably churn some.  

 

 

I disagree. I reckon they did gouge. And they got fat. And with this, they became complacent and were slow to move. And when they did finally feel enough pressure to do something, their response to the changing environment was, and remains, totally inadequate - (1) overpriced streaming, not even in HD, (2) clunky, at best, on-demand functionality (3) discriminatory price slashing for some, and punishing mandatory stand downs for others.

 

Fanpass is their only new product that looks attractive for the consumer, but I suspect it's income generating prospects are much less than provided by their historical monopoly pay service. Sky have plenty of cash reserves, so will be around for some time yet. But their day in the sun is well and truly finished.

 

 


 
 
 

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ockel
2031 posts

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  #1549653 11-May-2016 09:42

dafman:

 

tdgeek:

 

 

 

While they don't gouge, it isn't cheap either. A small decrease in sub wouldn't add any users, a small increase would probably churn some.  

 

 

I disagree. I reckon they did gouge. And they got fat. And with this, they became complacent and were slow to move. And when they did finally feel enough pressure to do something, their response to the changing environment was, and remains, totally inadequate - (1) overpriced streaming, not even in HD, (2) clunky, at best, on-demand functionality (3) discriminatory price slashing for some, and punishing mandatory stand downs for others.

 

Fanpass is their only new product that looks attractive for the consumer, but I suspect it's income generating prospects are much less than provided by their historical monopoly pay service. Sky have plenty of cash reserves, so will be around for some time yet. But their day in the sun is well and truly finished.

 

 

 

 

And what do you believe is an appropriate price to pay for 1 hours entertainment or 1 hours sport?  





Sixth Labour Government - "Vision without Execution is just Hallucination" 


tdgeek
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  #1549658 11-May-2016 09:48
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dafman:

 

tdgeek:

 

 

 

While they don't gouge, it isn't cheap either. A small decrease in sub wouldn't add any users, a small increase would probably churn some.  

 

 

I disagree. I reckon they did gouge. And they got fat. And with this, they became complacent and were slow to move. And when they did finally feel enough pressure to do something, their response to the changing environment was, and remains, totally inadequate - (1) overpriced streaming, not even in HD, (2) clunky, at best, on-demand functionality (3) discriminatory price slashing for some, and punishing mandatory stand downs for others.

 

Fanpass is their only new product that looks attractive for the consumer, but I suspect it's income generating prospects are much less than provided by their historical monopoly pay service. Sky have plenty of cash reserves, so will be around for some time yet. But their day in the sun is well and truly finished.

 

 

 

 

Gouging is charging more than is fair and reasonable. They dont do that, look at their ROI now and earlier. Being a listed company they could not if they wished to

 

Not slow to move, there has been no reason to move until right now. Neon and Fanpass are not setup as the new big thing, they are setup so that when they wish to make changes, the OD and Sport are there, ready to have whatever updates they decide might work. BTW FanPass isnt that attractive, live streaming only isnt great, not every sport fits into everybodys schedule, but it does work well from all accounts.

 

Cash reserves are not material, you cant watch a company go downhill and just keep in business and use them up. They will make changes, and what has been discussed in this thread has no doubt been discussed for months at Sky. Those changes will work, or they wont. I foresee Sky being pimarily a sports service


Rikkitic
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  #1549728 11-May-2016 11:13
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I think Sky has always charged as much as they could get away with. Whether that is considered gouging or not is a matter of definition. I also think looking at their return on investment as a justification for their pricing policy does not give the whole picture. Maybe their profits would be higher if they were more efficient and then they wouldn't need to charge as much.

 

  





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Benoire
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  #1549757 11-May-2016 11:32
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tdgeek:

 

... they wont. I foresee Sky being pimarily a sports service

 

 

This I think will be their primary point of difference.  I can't see sports being on a cheap platform, look how much BBC sport had to pay for the EPL for only half the rights; sports will remain expensive as they now rely on the income to fund the competitions; I'm not saying that Netflix couldn't have sport, only that sports will cost a lot more than general content and to watch 5 or 6 different ones could cost you up to $100 a month alone.


Benoire
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  #1549759 11-May-2016 11:34
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Rikkitic:

 

I think Sky has always charged as much as they could get away with. Whether that is considered gouging or not is a matter of definition. I also think looking at their return on investment as a justification for their pricing policy does not give the whole picture. Maybe their profits would be higher if they were more efficient and then they wouldn't need to charge as much.

 

  

 

 

But again, that's not gouging that's just pure poor management.  Gouging is when they can charge significantly more than the cost to distribute (or produce) at their current operating costs; if they reduced their operating costs by 75% then you could say they would be gouging, but not if they're only making a little more on top of their costs.  Cost affordability is a different thing all together.


Rikkitic
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  #1549792 11-May-2016 12:24
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Point taken. But it still works out the same for the poor customer.

 

 





Plesse igmore amd axxept applogies in adbance fir anu typos

 


 


ockel
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  #1549797 11-May-2016 12:31

Rikkitic:

 

Point taken. But it still works out the same for the poor customer.

 

 

 

 

But how much is the consumer willing to pay per hour of entertainment?

 

We all have strong views around here but no one seems to be able to articulate what they are willing to pay to have an hours entertainment - whether it be general entertainment or sport.

 

We all have a view as to whether a cup of coffee is expensive, whether a kilo of apples or beef or a cauliflower is expensive.

 

We all have a view as to whether $18 to watch a movie is expensive.  Or paying to watch a blockbuster on DVD or streaming.

 

How is it that no one can articulate value?





Sixth Labour Government - "Vision without Execution is just Hallucination" 


Rikkitic
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  #1549803 11-May-2016 12:41
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What people are willing to pay is probably what they have been willing to pay for overseas services like Netflix. When local pricing and availability become comparable here, the discussion will be over.

 

 





Plesse igmore amd axxept applogies in adbance fir anu typos

 


 


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