The case for direct cable channel subscriptions
A few days ago Bloomberg reported that HBO Go may be coming to Apple TV this year. Sounds interesting, right? Well, guess again. Unless something changes with the release, you can only watch HBO Go if you have a cable subscription. I have to admit that while I’ve read a ton about the cable business and how the market dynamics work, I still don’t understand the benefits for HBO to not charge a subscription. Maybe it’s a contract obligation?
Since I personally don’t have a huge interest in HBO, let’s use ESPN as an example instead. According to this article, ESPN makes $4.69 per household per month from cable companies and the total average bill for sports is $8. This includes many other ESPN channels (ESPN2, ESPN News) as well as regional sports channels.
As I’ve mentioned here before, we cancelled all cable subscriptions a while ago. Instead, we now have Netflix and Amazon Prime subscriptions, streamed through our Apple TV and Roku box. In addition, I subscribe to MLB.tv each year. Netflix runs $20/month, Amazon Prime at $7/month, and MLB.tv at $10/month . That’s trading a $70 per month cable bill for $37/month. The point of this is to note that ESPN gets nothing from me.
So, ESPN, here’s what I propose: Offer me streaming versions of ESPN, ESPN 2 and ESPN News for $10/month. We both win. You get about twice the rate you get from cable companies and I get sports. $47/month is still a bargain for me versus the $70 cable bill (and rising every year). I get what I want — more sports — and you get exactly what you want — money from me.