“If I could just cherry-pick AMC, FX and not have to pay for Nickelodeon and not have to pay for all the other stuff, you might get there,” said Mike White, chairman/chief executive officer of DirecTV, at a MoffettNathanson Research event.It probably won’t happen, though. It wouldn’t be simple for the likes of Disney to partner with Dish Network to start an OTT service. Instead, White believes, Disney and others will do all they can to package in as many channels as possible. Because they are big diversified TV/media companies, they will use their leverage to get the most bang for their buck, defeating what price-sensitive TV consumers ideally seek -- to spend less on TV by signing up for just the handful of channels they want to watch.
White said even a $35 or $40 a month TV package isn’t cheap enough, that more than $12 a month turns off these consumers.
The likes of Aereo, at just under $10 a month, may a good idea for a cheaper product. But Aereo’s viability is still up in the air, with the Supreme Court expected to rule on it sometime in the middle of next month.
Even then, getting content owners to sell their channels on a selective, individual basis to a DirecTV, Dish or Comcast for a slimmed-down OTT service would be tricky. That’s because big media-content producers also want to continue selling their usual bundle of networks to TV distributors for those all-inclusive, high-priced, all-you-can-eat services.
What would make a true OTT a la carte service work? The answer: incremental revenue for all parties -- and savings for consumers. That’s a floss-thin tightrope. White says these new-type of OTT services might just “cannibalize” the old ones.
“Cannibalization” and “a la carte”: Words to be entertained by.