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Direct TV vs. Viacom

July 13th, 2012

Well, here we are again. It was only a couple of summers ago that I was writing about the standoff between cable company Suddenlink, and media giant Viacom. Well, the boys who brought you the annoying,walking and talking sponge are at it again. As I understand it, Viacom is demanding a thirty percent rate increase from Direct TV, for the privilege of providing its list of cable channels like MTV, Nick and Nick Jr., TV Land and quite a few others; this despite sinking ratings.

The Satellite provider has refused the higher rates and has stopped broadcasting the extra networks until such a time as a deal can be struck, but its not going well. Neither side is willing to budge. Now I am not necessarily an opponent of big companies. The person or group who provides goods and services has the perfect right to ask what they want for those goods and services. I’m fine with media, cable and satellite providers making money.

A rising tide lifts all boats. I get it. But I’m increasingly opposed to what I see as Viacom’s shakedowns of every cable and satellite company who carries their channels. The fact is the network giant does the same thing to the carriers as they do to us. They sell their networks in packages, forcing them to pay for unpopular, low rated channels and programming in order to obtain programs that actually sell. Thus, we as customers can’t pick and choose our own lineups.

Now I should say that this is all perfectly legal, however, I read a few different articles in order to better understand the issue, and numerous authors cite the probability that the loss of channels will drive more customers to the likes of Netflix or Hulu where they can not only pick their networks but their individual programs. I’m certainly no expert on how these markets operate, but it seems to me that Viacom is working hard to get as much milk as possible from a dying cash cow, before she finally expires. The company would do better (in my humble opinion) to find a way to give as much choice to the consumer as possible before they go somewhere else entirely.

Redbox Being Challenged By The Movie Studios

December 16th, 2009

Redbox is suing 21st Century Fox and Universal Studios for telling Redbox to wait a few weeks after their movies go on sell before renting them. In the past the studios had attempted to prevent movie rental stores from even starting. This attack against Red Box seems like another attempt by the movie studios to prevent a movie rental business model from developing.

The Redbox movie rental boxes in Walmart actually help the movie studios considering Redbox users rent about 20% more movies then other more traditional movie rental stores. Redbox has sold more then 77 million dollars in DVD’s through their boxes from users who have decided to keep the DVD rather then return it. All in all a case can be made that Redbox is really helping the movie studios rather then hurting them.

Since Redbox is a new business model the movie studios are just unsure about how it will effect their bottom line. The fact is Redbox is increasing volume, providing savings back to the consumer and offering a more convenient way to rent movies. Over the next few years Redbox will be helping the movie studios rather than hurting them as they offer a more effecient way to purchase and rent movies.

The movie studios like any major cash cow business becomes stuck in the familiar old school ways of doing business and are uncomfortable venturing out and trying something new to increase sales. They see Redbox making all this movie money and they feel that Redbox is shaving profit margin from new DVD sales. The fact of the matter is that Redbox stepped up and provided a more affordable and convenient way to shop and rent DVD’s by paying a dollar a day from convenient Walmart red boxes.

I have bought atleast one Redbox DVD simply because I never returned it. I have rented more movies that I would have never rented before because of the convenience of Redbox and I enjoy the limited but good selection of top dvd rentals. I end up spending an hour or two in a DVD movie rental store but only about 5 minutes searching for a movie rental using Redbox.

The movie studios need to leave those little Redbox movie rental boxes in the Tyler Texas Walmarts alone. We Tylerites like our Redbox, they’re good for me.