DirecTV and Viacom? Let's make a deal

[Coconut36]

I think that they are both trying to force their agenda. We were about to switch to Direct TV but I want to see how this goes first.

Well I agree DirectTv has an agenda too..but I think Viacom is the one that is presenting the bigger problem here especially when they pulled their online programming.

i think this actually makes Viacom look greedy. They locked everyone else out just to prove a point to DirectTV. This is definitely bad rep for them. Hope this goes to Arbitration...

I agree completely. Very nasty of Viacom to do this. I hope they push the issue. Their increase seems pretty harsh and unreasonable.

 

[marmalade]

I think that they are both trying to force their agenda. We were about to switch to Direct TV but I want to see how this goes first.

They do both have an agenda, the only difference is Directv wants to keep prices low not only for their bottom line but for their customers as well. I may not like losing channels but I would rather lose the few that we watch then have Directv raise my rates to keep channels that I hardly ever watch.

People adapt, if Viacom removes these channels for a while, Directv subscribers will find other things to watch. When that happens a lot of people might not return to watching Viacom stations if they ever come to an agreement.

 

[pyrxtc]

I'm not missing much of anything. The kids are happy with Disney channels and cartoon Network. My DH will miss Extreme 4x4 and I can watch Teen Wolf online.

 

[sam_gordon]

I agree completely. Very nasty of Viacom to do this. I hope they push the issue. Their increase seems pretty harsh and unreasonable.

30% increase after seven years of no increase? Maybe high, but I don't find it harsh or unreasonable. I'd be surprised if Viacom expected to get 30%. Since it's a negotiation (or is supposed to be), the 30% should be a starting point.

 

[Coconut36]

30% increase after seven years of no increase? Maybe high, but I don't find it harsh or unreasonable. I'd be surprised if Viacom expected to get 30%. Since it's a negotiation (or is supposed to be), the 30% should be a starting point.

The increase equals a billion dollars..that is extreme. Their increase would also require the provider to raise rates as well. That is extreme IMO. I can assure you DirectTV has not been willy nilly increasing our rates during that 7 year period and Viacom just sadly missed out. I just had a rate increase recently..first one in several years and only have had 2 total in almost 8 years (if I am remembering correctly).

 

[sam_gordon]

The increase equals a billion dollars..that is extreme. Their increase would also require the provider to raise rates as well. That is extreme IMO. I can assure you DirectTV has not been willy nilly increasing our rates during that 7 year period and Viacom just sadly missed out. I just had a rate increase recently..first one in several years and only have had 2 total in almost 8 years (if I am remembering correctly).

So because it's a billion dollars, it's extreme? I disagree. I think looking at the percentage increase is more valid. To me, a 30% increase is high, but not extreme. Especially when you consider that's the STARTING point. Presumably it's negotiable.

Also, is that one billion dollar increase that D* is throwing out per year or over the length of the contract? It's ALL spin (by both sides).

I'm curious... how much was the rate increase (if you remember) by percentage of your bill?

BTW, I'm not saying Viacom should get everything they ask for. I think both companies are playing hardball with each other and the viewers are the ones who suffer.

 

[Coconut36]

So because it's a billion dollars, it's extreme? I disagree. I think looking at the percentage increase is more valid. To me, a 30% increase is high, but not extreme. Especially when you consider that's the STARTING point. Presumably it's negotiable.

Also, is that one billion dollar increase that D* is throwing out per year or over the length of the contract? It's ALL spin (by both sides).

I'm curious... how much was the rate increase (if you remember) by percentage of your bill?

BTW, I'm not saying Viacom should get everything they ask for. I think both companies are playing hardball with each other and the viewers are the ones who suffer.

My increase was less than 5% and the first one I had in several years. I had one other that was similar when I first signed up with them.

Take a look at a bill you pay and increase it by 30%..that is a lot to be asking and I think Viacom is way overboard. I get the impression they are trying to play hardball and it isn't necessarily "negotiable" hence their attitude of making DirectTV pull the channels and removing online content.

 

[sam_gordon]

Take a look at a bill you pay and increase it by 30%..that is a lot to be asking and I think Viacom is way overboard. I get the impression they are trying to play hardball and it isn't necessarily "negotiable" hence their attitude of making DirectTV pull the channels and removing online content.

But that's a 30% increase after zero increases for seven years. Like I said, high, but (IMO) not extreme.

So you think Viacom should have let D* keep the channels up? Then why would D* negotiate? Pulling the online content was a bad move, I've said that before.

Assuming Viacom's "a couple pennies a day" per subscriber is right, that could be less than $1/month per household. You think D* is going to argue "they want to charge $1/month more!"? Again, it's all spin.

 

[Coconut36]

But that's a 30% increase after zero increases for seven years. Like I said, high, but (IMO) not extreme.

So you think Viacom should have let D* keep the channels up? Then why would D* negotiate? Pulling the online content was a bad move, I've said that before.

Assuming Viacom's "a couple pennies a day" per subscriber is right, that could be less than $1/month per household. You think D* is going to argue "they want to charge $1/month more!"? Again, it's all spin.

Don't get me wrong..I don't disagree both sides are spinning but I do think 30% after 7 years is way too much. They agreed to those terms for 7 years and not with the condition that they can raise it as high as they want when the time is up. When you sign a contract you are aware of the conditions and it doesn't give you free reign when it is over. Negotiating is fine and good but I don't feel they are doing that right now.

Viacom's spin is the "couple of pennies" but it works out to be more than that (thus equally more than a $1 increase on the bill) and I think DirectTvs biggest issue is that the Viacom channels are not thriving..many have dropped during the contract yet they are asking for more money than they appear to be worth. I think Viacom will lose the most in the end. I will not switch and while my kids will be ticked they will adapt without Nick Jr.

 

[sam_gordon]

Don't get me wrong..I don't disagree both sides are spinning but I do think 30% after 7 years is way too much. They agreed to those terms for 7 years and not with the condition that they can raise it as high as they want when the time is up. When you sign a contract you are aware of the conditions and it doesn't give you free reign when it is over. Negotiating is fine and good but I don't feel they are doing that right now.

Actually you DO get free reign at the end of the contract. That doesn't mean the other side has to accept.

Viacom's spin is the "couple of pennies" but it works out to be more than that (thus equally more than a $1 increase on the bill) and I think DirectTvs biggest issue is that the Viacom channels are not thriving..many have dropped during the contract yet they are asking for more money than they appear to be worth. I think Viacom will lose the most in the end. I will not switch and while my kids will be ticked they will adapt without Nick Jr.

I assume you're using the $1B increase D* is complaining about as your basis for more than a "couple of pennies". As I mentioned, do we know if the $1B increase is each year or over the life of the new contract? How long is the contract?

A two cent increase per subscriber per day would be over $1B over a seven year contract (.02 * 365 * 20M * 7). That would cost you 60 cents more a month. THAT would REQUIRE D* to raise your rates?

 

[ICF]

Assuming Viacom's "a couple pennies a day" per subscriber is right, that could be less than $1/month per household. You think D* is going to argue "they want to charge $1/month more!"? Again, it's all spin.

or "pennies a day" could be 9 cents a day x 365 days = $32.85 a year ($2.74/mo) per subscriber in costs to DTV.

And since DTV has to try and maintain a certain profit margin, that $32.85 in cost to D, is really going to be an extra charge of $35 - $40 / year more for me (for just these channels) going forward.

I'm not sure of the exact D subscriber count (I've seen between 20M & 30M) people.

So....if we go on the low end for all of our assumptions and say....

20M people x .05 cents a day x 365 days that would be an extra cost to DTV of $365M

On the high end....

30M people x .09 cents a day x 365 that would be $985.5M -- or in business rounding, $1 Billion of extra costs.

Who knows the truth in the bickering between sides, but I have no problem with DTV trying to hold their ground.

 

[sam_gordon]

Who knows the truth in the bickering between sides, but I have no problem with DTV trying to hold their ground.

So networks should never be allowed to increase their fees to the providers?

 

[Bob NC]

So networks should never be allowed to increase their fees to the providers?

I think the networks should be looking to their advertisers for price increases.

Hey networks, the better your programming, the more demand and ratings you provide, the more you can charge your advertisers.

Guaranteed money from the cable providers does NOTHING to entice you to better your programming.

 

[Coconut36]

So networks should never be allowed to increase their fees to the providers?

Like with anything supply and demand play into it. Reading what is out there indicates Viacom channels have dropped significantly in viewership/popularity. You don't ask for top dollar for something that isn't popular or isn't doing as well as competing products because you will not get it. A rate increase that is reasonable and appropriate to what you offer is fine and likely would be given more consideration than one that is not in keeping with the usefulness/quality of your product. It's like asking for $20,000 for a 13 year old car (that has no value to collectors) when one could buy the same type of care new for the same or close to the same price. Viacom doesn't appear to have the worth/value they are asking for and they are linking in channels that are really losers into the amount and forcing consumers and DirectTv to pay the same for channels nobody watches as they do for the few that garner some popularity/value.

 

[pat fan]

Hey networks, the better your programming, the more demand and ratings you provide

Exactly, and the stuff Viacom has on DTV is, IMHO, crap. I don't watch any of it, with the exception of TVLand, and I can get old Mash etc...elsewhere.

Let 'em go!

 

[ICF]

So networks should never be allowed to increase their fees to the providers?

did I say that?

The "facts" as I've read them...is that for most of Viacom's channels the viewership is down -- yet they want DTV to pay more for channels losing viewers.

Reading on dbstalk.com, most DTV subs, care about only one or two of the channels (at most) that have been lost...mainly Nick & Com. Central.

Perhaps Viacom should have come in with a 5% increase in year one and then an additional 5% increase over the next 5 years...so that by year 5 they were at a 25% increase vs. the method they tried.

For Viacom to come in and upfront want a 30% increase for many channels that people just dont care about, was a bad move on their part.

 

[sam_gordon]

Like with anything supply and demand play into it. Reading what is out there indicates Viacom channels have dropped significantly in viewership/popularity. You don't ask for top dollar for something that isn't popular or isn't doing as well as competing products because you will not get it.

Except according to the link I posted earlier, three of the Viacom channels (Nick, Spike, and Nick Jr) are in the Top 25 of 'Total Day' viewers, with Nick at #2. Four channels (BET, Comedy Central, Spike, and VH1) are in the top 25 for 18-49 adults during Prime Time.

did I say that?

The "facts" as I've read them...is that for most of Viacom's channels the viewership is down -- yet they want DTV to pay more for channels losing viewers.

Reading on dbstalk.com, most DTV subs, care about only one or two of the channels (at most) that have been lost...mainly Nick & Com. Central.

And when AMC dropped their channels for Dish, most subscribers only cared about one channel (and only three shows on one channel).

Perhaps Viacom should have come in with a 5% increase in year one and then an additional 5% increase over the next 5 years...so that by year 5 they were at a 25% increase vs. the method they tried.

GREAT IDEA. Maybe you need to be at the negotiation table.

For Viacom to come in and upfront want a 30% increase for many channels that people just dont care about, was a bad move on their part.

I never said it was a good move. But we don't know that D* has negotiated in good faith. They could BOTH be to blame (and that's actually where I side).

 

[FlightlessDuck]

People adapt, if Viacom removes these channels for a while, Directv subscribers will find other things to watch.

I switched for Daily Show and Colbert to Conan. They both should still be available on Hulu, though. I hope...

 

[Coconut36]

Except according to the link I posted earlier, three of the Viacom channels (Nick, Spike, and Nick Jr) are in the Top 25 of 'Total Day' viewers, with Nick at #2. Four channels (BET, Comedy Central, Spike, and VH1) are in the top 25 for 18-49 adults during Prime Time.

And when AMC dropped their channels for Dish, most subscribers only cared about one channel (and only three shows on one channel).

GREAT IDEA. Maybe you need to be at the negotiation table.


I never said it was a good move. But we don't know that D* has negotiated in good faith. They could BOTH be to blame (and that's actually where I side).

But that isn't that compelling when you realize that they have maybe 7 channels with decent viewership..there are 10 more with crappy or less than stellar (or seriously dropping) viewership. That means almost 60% of their offerings lack in viewers but they want the same price for those as the few that are doing well.

No we really don't know that DirectTv has negotiated in good faith either but I tend to feel in the scheme of things they are more in the right to put their foot down than Viacom especially after Viacom blocked previously free/accessible viewing online. It's not a reasonable business practice to expect top dollar when only a fraction of your offerings warrants those dollars. You adjust accordingly and that seems to be where the biggest issue lies. Is a 30% price increase really reasonable when only 7 out of 17 channels have any decent viewership/ratings?

 

[sam_gordon]

But that isn't that compelling when you realize that they have maybe 7 channels with decent viewership..there are 10 more with crappy or less than stellar (or seriously dropping) viewership. That means almost 60% of their offerings lack in viewers but they want the same price for those as the few that are doing well.

Really? You've seen the breakdown on how much they want for each channel?

No we really don't know that DirectTv has negotiated in good faith either but I tend to feel in the scheme of things they are more in the right to put their foot down than Viacom especially after Viacom blocked previously free/accessible viewing online. It's not a reasonable business practice to expect top dollar when only a fraction of your offerings warrants those dollars. You adjust accordingly and that seems to be where the biggest issue lies. Is a 30% price increase really reasonable when only 7 out of 17 channels have any decent viewership/ratings?

OK, I'm going to say this again...
VIACOM MADE A MISTAKE BY BLOCKING ONLINE ACCESS.
Also...
30% IS HIGH.

I have NEVER indicated D* should automatically pay a 30% increase.