T-Mobile’s new TVision, an internet-delivered pay TV platform, launched with the plan of essentially separating the bigger TV networks from the smaller -- the former perceived to be in somewhat higher demand than the latter.
Generally speaking, that means putting big broadcast TV networks, as well as sports TV networks like ESPN, around 30 or so overall, in its TVision Live option for $40 month.
Another 30, mostly entertainment-driven cable TV networks, were then placed in what is called TVision Vibe -- for $10 a month extra. Get the picture?
After hearing complaints from David Zaslav, president/CEO Discovery Inc, during the company’s recent earnings call, alluding to a possible breach of contract when it comes to carriage of Discovery networks, T-Mobile quickly made adjustments.
Launching a recent holiday promotion to sign up for TVision Live, T-Mobile now believes TVision Vibe should be free.
T-Mobile’s thinking isn’t new. Early on, new virtual pay TV providers didn’t include many cable TV networks that typically show up on cable, satellite, and telco services. Recently, that moved further, with niche sports networks. Hulu + Live TV, YouTube TV and other virtual providers dropped Sinclair Broadcast Group’s regional sports networks.
In addition, going forward, specific cable TV networks groups, such as ViacomCBS and AMC Networks, have looked to offer a complementary on-demand TV options -- direct to consumer business -- to boost revenues (advertising, subscription, and otherwise). Discovery is set for a big streaming announcement next week.
For its part, TVision might continue to segment cable networks going forward, profit margins being razor-thin among virtual pay TV providers.
But the end result is the same: Asking consumers to pay more.
The downside for new pay TV providers is consumers' creative ways to make up their own TV packages, choosing a select core of live, linear TV networks, and perhaps five to eight other on-demand streaming packages.
All that will leave new virtual pay TV providers and on-demand distributors, such Roku, Amazon and others, left to play guessing games as to what to offer.
Likewise mainstream cable networks will continue to need good TV vision.