Wednesday, 27 November 2013

07:48 – Well, this is ugly. Following news that Obamacare has forced something like 10 million people to lose their individual health insurance plans in 2013 comes news that Obamacare may force up to 150 million more to lose their company-sponsored group health insurance plans in 2014. Things are already looking bad for the Democrats in the 2014 mid-term elections, and are going to start looking a lot worse. Best case, the Republicans will take control of both houses of congress, repeal Obamacare, impeach and convict Obama for high treason, and send him, Reid, Pelosi, and the rest to Guantánamo Bay. That’s assuming the general public doesn’t catch, lynch, and hang them from lamp posts first.

14:22 – That’s interesting. Apparently, Amazon Prime 2-day shipping actually means two days, more or less. I ordered three items with Prime shipping at 1630 yesterday. Two of them arrived half an hour ago, 21 hours after I placed the order. The third item just shipped an hour ago and isn’t supposed to arrive until Monday, six calendar days after I placed the order.

Now that Amazon has added a watch list to Prime Video, it’s actually usable. I just checked, and we’ve watched a grand total of 86 minutes of Netflix streaming video in the last 16 days. Not that we’ll drop Netflix Instant any time soon. It has lots of stuff that Amazon Prime video doesn’t, and vice versa. At $8/month for Netflix streaming and $80/year for Amazon Prime, we’re not going to run out of things to watch. It’s no wonder that the broadcast and cable networks are quaking in their boots. Other than sports, there’s nothing keeping most people from dropping cable and OTA completely.

If I were a broadcast or cable network executive, what’d be keeping me awake nights is the fear that the sports organizations might abandon me and go direct to customers. If MLB, NFL, NBA, PGA, USTA, NASCAR, and the other sports organizations had any sense, they’d be selling direct to customers and cutting out the middleman. But if they’re going to do that successfully, they need to keep three essential principles in mind: no commercials, on-demand with no black-out, and all-you-can-eat. People don’t want to have the program interrupted by commercials. They want to watch what they want to watch when they want to watch it. And they want to pay by subscription rather than per view. The organizations that do all of those will make money hand over fist. Those that don’t will regret their decision.

If HBO, Showtime, AMC, and the other cable networks want to remain relevant a bit longer, they need to take the same approach. The sweet spot seems to be $7 or $8 per month for networks with a lot of original content and maybe $3 per month for those with less content. And, make no mistake, original content is key. You can use non-current movies and TV seasons to fill out your offerings, but it’s original content that draws viewers. And even doing that will keep these aggregators relevant for only the next few years. More and more, we’re seeing the actual content producers going directly to their customers, and that’s where the future lies.