Television

Hulu and the Subscription Model

by Smithee on October 27, 2009

This is an editorial by Smithee and a plea for your help in shaping the future of entertainment.

At our house, we enjoy some Hulu programming on occasion. Even though during the recent DVR years I’ve become accustomed to skipping commercials, I don’t mind them on Hulu, for these reasons:

I’ve only seen one per commercial break
They haven’t been suddenly, obnoxiously loud
Hulu is free, and so advertising makes sense

And so far, there’s no ability to skip them. I can deal with that, because in an episode of, say, “Defying Gravity” on Hulu, there are five commercial breaks, for a total of five minutes of Lipitor commercials (at first, every episode would play five of the same Lipitor commercial, it was almost funny). I can accept five minutes. That means about 9.6% of a 43-minute show is an ad. That’s fine, so long as the service is free.

But that is going to change sometime in 2010. Hulu is owned by NewsCorp (who owns roughly half of everything), and they have decided:

It’s time to start getting paid for broadcast content online. I think a free model is a very difficult way to capture the value of our content. I think what we need to do is deliver that content to consumers in a way where they will appreciate the value. Hulu concurs with that, it needs to evolve to have a meaningful subscription model as part of its business

Anything more specific than this decision is just speculation: subscriptions for what, everything? premium channels only? groups of channels? Nobody knows.

What I propose is unacceptable is this: a subscription fee for any user, for any content, so long as the advertising remains part of the experience. In other words: unskippable ads are no problem, subscription fees for any content are no problem, but both together would be a problem.

You and I have a chance right now to help influence and inform Hulu’s decision to go forward with a subscription model, before we let ourselves get duped.

Sadly, we’ve been letting ourselves get duped for a long time.

Newspapers, Cable TV, mobile phones

Newspapers are filled with advertisements, and they also expect you to pay for each copy. The same is true of magazines. In fact you could argue that any fashion magazine is just one huge multi-part advertisement. So, I don’t read them. Oh, I look at the news online all the time, but between my banner-blindness and various browser plugins, it’s not often I see an advertisement.

TV is a different story. TV used to be just like radio: the good parts were ad-supported, and you also had a station that relied on member subscriptions. Cable messed that all up, and we were too busy with the colorful new channels to notice. A cable company would set up shop in your town and tell you all about the dozens of extra options you’d get for $X / month. We were totally psyched to get MTV and Nickelodeon at our house, but it didn’t occur to me until later than since the cable company replaced our over-the-air channels, we were now paying for something that used to be free. Thirteen free somethings, in fact (UHF was admittedly pretty empty).

There’s an argument that in the case of OTA / broadcast channels, what you’re paying the cable company for is consistent quality of signal. I’d be happy to see some proof of that, in the form of a cable company’s accounting spreadsheet. I’m sure that NBC is charging the cable ~~companies~~ regional monopolies a fee to include their programming, and cable is passing that cost on to the customer.

The mobile phone business model just depresses me whenever I think of it. Here’s how a phone worked since the time it was invented: if you called someone, you were expected to pay for it, but if someone called you, it was free. This makes total sense: the phone call recipient didn’t intend to have that conversation, he or she isn’t really responsible. Besides that, this seemed to work very well for decades, and phone companies never changed it. That is, until we were tooling around town with phones in our pockets and cars. Since it was new and fancy, providers decided to invent a different business model: you’d be paying for calls now whether you started it or not.

As far as I know, mobile phone companies have never had to justify this to their customers en masse.

AOL vs. World of Warcraft

Remember those CDs of AOL software? They were everywhere. It seemed like you’d get a new version in your mailbox every three months, especially if you weren’t even a customer. They were free, because AOL’s business model was a monthly fee for access, content, and software upgrades. And AOL did fine for a long time.

Everquest came along and messed that all up, charging both a monthly fee and an upfront fee for the software, and now WoW players suffer the same fate. You’re paying the company twice for the same things they were going to be doing anyway. What is wrong with us? Why do we enable companies to use more than one business model at a time?

Advertising is a replacement for subscriptions

And vice versa: subscriptions are a replacement for advertising. Advertising is one business model, and subscriptions are another. Employing both for the same product is unacceptable.

I’d like to ask for your help now in spreading this message to the managers at Hulu, so they understand the intelligent way to move forward is to either saddle us with a recurring fee and remove the commercials, or leave the commercials in an otherwise free service.

On Hulu’s discussion forum, there are already many threads decrying the decision to start charging. You could try adding your own voice there, or e-mailing feedback@hulu.com. Another less elegant method would be to add an irrelevant comment on one of the entries at the official Hulu blog. In my experience, site owners are more likely to read blog comments than they are discussion forums, but your mileage may vary.

Hulu’s Free Glory Days Are Official Numbered, John Herrman, Gizmodo, Oct. 22 2009

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Is it Ever Okay to Steal Entertainment?

by Smithee on July 21, 2009

As a part-time producer of creative works that I think are worth something (though I’m not currently requiring payment for anything), I struggle with the urge to acquire my entertainment media as conveniently, quickly and cheaply as possible. My viewpoints on this have changed over time, especially as my disposable income grew, and I’d like to share with you my current ideas / rationalizations on when it’s okay to steal.

Music you’ve already paid for

Depending on when you were born, you may have bought some of your favorite albums in upwards of five formats: vinyl, 8-track, cassettee, CD, and MP3 (if you lost the CD, or it got too scratchy). I’ve never actually held an 8-track tape, but I’ve owned albums in all the other formats, and I’ve decided I’m not re-buying anything.

When I bought my first CD in 1989, (Faith No More’s “The Real Thing”, which still rocks really hard), the people who produced it had no intention of tracking its sale for more than a couple of years, not to mention that conventional wisdom at the time considered the new Compact Disc format to be practically immortal.

Practical concerns aside, I paid for it once, and music isn’t meant to expire. So, even though the CD itself got lost somewhere along the last twenty years, when I decide I want it back in my music library, I won’t be paying for it. It was already paid for. I’ll just acquire it somewhere.

Shows your location won’t allow you to watch

My wife and I deeply enjoy a few shows that are produced and released by the BBC. We have BBC America, but even the shows that make it over to this country are delayed, usually six months or more, and they’re often edited, censored and shown in standard definition (as opposed to HD).

So I download those shows as soon as they’re available online. This is not the same as downloading, say, “True Blood” without being a subscriber to HBO. I feel a little more justified in yanking “Doctor Who” down to my hard drive because BBC content is produced without regard for sponsors or subscription fees, as we understand them.

Movies and TV from used/rental stores

I’m a little more iffy on this one; sometimes it depends on the quality of the movie, but after a DVD is bought once, the studio got paid as much as they were ever going to. If the DVD then ends up in a used/rental store, I don’t have a moral problem with copying the DVD to my hard drive, and then taking the DVD back to the store.

There’s also the case that I saw the movie when it was new in the theater, and I’ve rented it at least once. In that case, I can’t bring myself to pay for it again, and I’ll just make a digital copy.

Frankly, if it were easier, and a little bit cheaper, to legitimately buy and download (and keep, forever, free of DRM… otherwise it’s leasing, not buying) a movie. I’d probably do that instead of “stealing” it.

The flipside

On the other hand, when a show originates online (e.g. Homestar Runner, Dr. Horrible’s Sing-a-long Blog, Ask a Ninja), I’m more than happy to support the creators by buying DVDs and merchandise. Why? Because they don’t bother me with commercials. They can’t keep making the show without me, and that’s a business model I can get behind.

Your ideas

Do you have similar rules for yourself? I’d love to hear them in the comments.

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Un-broke TV Special on Friday, May 29th

by Smithee on May 26, 2009

in Education

I’ve often written here about the disappointing lack of financial education in schools, and it’s this same dearth of vital information that has apparently led to a new special airing on ABC this Friday:

Schools teach us almost everything, but not “Money 101.” For the basics on finance, turn to UN-BROKE: What You Need to Know About Money. It’s an unconventional look at the fundamentals of everyday finance with all the facts about credit cards, mortgages, stocks and bonds, investing and 401(k)’s, in a fresh new format combining information and humor. The one-hour special airs FRIDAY, MAY 29 (9:00-10:00 p.m., ET) on the ABC Television Network.

Here’s an example video of actor/producer Seth Green’s take on the MTV show “Cribs”:

I encourage you and your families to watch the show, as TV networks almost never take time out of their programming schedule to present the kind of information that, while basic, refuses to graduate to “common knowledge.”

Personally, I plan to set the DVR to record it, and then skip the commercials.

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Digital Television Transition Approaching

by Flexo on May 20, 2009

June 12, 2009 is the final day that full-power television stations will broadcast in an analog over-the-air signal. The date was originally set for February 17, but due to broadcasters who needed more time and congressmen who felt the public needed more time to understand the transition, the deadline was extended until next month.

This also has provided companies more time to create confusion in an effort to sell products and services.

Cable companies like Cablevision use the digital transition to try to convince holdouts still using antennas that the best way to avoid a problem is simply to sign up for a yearly contract, with a special “low-cost program.” They might be right. If you have cable or satellite service, you will be immune to the digital transition. Virtually all cable companies serve digital signals into homes now. But the low-cost program offered might provide you with fewer channels than you have now as a customer of free, over-the-air broadcast television.

Retailers use the digital transition as an excuse to convince consumers that it’s time to upgrade to a high-definition television. I routinely talk to people who are convinced that they need to buy a high-definition television in order to watch any television after the transition date. This was never true. A digital television is not the same as a high-definition television broadcast. You can watch digital television on your older cathode ray tube (CRT) television. You do not need to buy a new television, even if your old box has only an analog tuner.

At the very minimum, you will need to buy a digital converter box if your television has only an analog tuner. There are coupons available, two per family if you apply for the coupon before July 31, to help defray the cost of two converter boxes. If you buy a converter box, keep this in mind: Even after the digital transition deadline, some low-powered stations may continue broadcasting in analog only. If you want to receive these stations after the transition, you must buy a converter box which offers a feature called “pass-through,” which allows analog and digital signals to be sent to your television.

If you use antennas to receive analog television now, the same antennas will receive digital television. Digital signals are weaker, though, so you may find in order to receive digital reception that is comparable to your old analog reception, you’ll need an outdoor antenna.

There is more information from the FCC and the Department of Commerce runs the coupon program.

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Repost: Misconceptions About the Transition to Digital Television

by Flexo on November 13, 2008

I originally posted this article in January 2008. As February 17, 2009 draws closer, I am still dismayed by the misinformation being spread by television manufacturers, cable operators, retail salespeople, and coworkers. Please pass this information to anyone who has the wrong idea about the switch to digital-only over-the-air broadcasts.

Whenever the subject turns to high definition television, I’ve always found a few people who are disappointed because they believe they need to sell their television and upgrade to high definition (HD) by February 17, 2009, they day the lights go out on analog broadcasts. This is a significant misconception, an incorrect assumption that is encouraged by electronics stores that use confusing and sometimes misleading terminology. Stores are encouraging people to upgrade to high definition televisions, inspiring fear that once February 17, 2009 rolls around, their current TVs will go dark, unable to receive signals from their cable or satellite company.

This is simply not true. The only changes will be to free over-the-air signals. For the most part, the only people who will be affected are those who use standard antennas to receive free television. Many people have cable or satellite boxes that are not affected by this change. The cable company will receive those local stations via the required digital signal and will send the signal to your house. The set-top cable or satellite box will use a digital tuner to receive signals and will send the video to your television over an analog or digital cable.

old television If you subscribe to cable or satellite, this change will not affect you at all. If you use a cable box, the company has taken care or will take care of everything for you. If you receive cable service without a set-top box, you may need to contact the company.

If you are one of the many people across the country who watch only the television programs broadcast over the air, you have three options.

1. The first option is to buy a new standard definition (SD) television set. Almost all new televisions have digital tuners now, but check the specifications before you buy. Don’t buy a “monitor,” which has no tuner at all. You don’t need to buy an expensive HDTV if you want to save money.

2. The second option is to buy a special DTV converter box. These cost about $50, but households can request up to two $40 coupons.

3. The third option is to subscribe to a cable or satellite service. The most basic cable service costs less than $20 per month.

The biggest misconception I’ve been exposed to, particularly at work, is the idea that to receive any television at all after February 17, 2009, you will need a high definition television. This is simply not true. Please get the word out.

Image credit: ninjapoodles
DTV Transition Coalition
Digital Television from the FCC

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“Wife Swap” Looking for Investment Club Members

by Flexo on November 10, 2008

in Family and Life

If you’re a member of an investment club and are in a typical family unit, ABC wants you to apply to be on the reality series, “Wife Swap.” If you’re selected, your family will receive a “financial honorarium” for appearing on the show, and if you know of someone else who would be a good choice for the show, ABC will pay a $1,000 referral fee to you if they are selected.

Here are some of the details.

Are you a mom passionate about your investments? Are you an active member of an investment club? Trying to keep it together in today’s hard economy? Then I want to talk to you!

The premise of Wife Swap is that one parent from each household swaps places for a week to experience how another family lives. It is an incredible family experience and opportunity to both learn and teach different family values. Potential families can live anywhere in the continental United States, but we ask that families applying for the show consist of two parents and have at least one child, age 7 -17, living at home.

To submit for the show please email a family photo and description to gaby.wifeswap (at) gmail (dot) com. Here is more general information about “Wife Swap.”

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in Financial Advice and Advisers

Pay to Be a Financial Expert on Television

by Flexo on October 13, 2008

Last week, I had doubts about the advice provided by a so-called financial expert on the local prime-time network news program. Offering advice in public is a difficult task to do well. You have to appeal to your audience by suggesting solutions appropriate for the bulk of the listeners, a group that can vary in terms of intelligence, experience, and education.

In many cases, what ends up happening is that the advice is geared to the “lowest common denominator” (in the non-mathematical sense) and those in need of personalized financial advice end up feeling dangerously fulfilled by platitudes, rules of thumb, and averages. But aside from financial guru superstars like Suze Orman, Dave Ramsey, and Robert Kiyosaki, how do producers of local news programs find the experts they use for their economic/human interest pieces?

According to “the Mole,” my favorite undercover financial adviser, radio and television stations contact financial professionals in the community. The stations approach financial advisers to invite them to present “expert opinion.” There is a catch, however. The financial adviser must pay the station to appear.

Previously, I assumed two things. First, if you are interviewed on a television or radio show, you are not paid for your appearance, nor do you have to pay the broadcaster. I’ve been interviewed several times for print and radio, and never once have I been paid nor have I received an invoice. Second, if you are a station or program’s “official financial expert” or “resident financial adviser,” you are paid for your affiliation. The station should be lucky to have an expert like you on “staff.”

This is not the way media works. Radio and television considers your appearances as advertisements for your financial advisory business. Accordingly, you must pay in order to appear. While I have no evidence if that was the case with the financial adviser on the ABC news program I happened to catch, if the Mole is correct (and I generally trust what he has to say), it’s likely she paid ABC in order to be their resident expert and have her name and phone number flash across the screen.

It makes sense from a business standpoint as well. Presumably, the news audience will believe that this financial adviser is reputable for her to be “awarded” the post of resident expert. In turn, some of the audience may become clients. This may make the adviser’s fee worth the price of admission.

As consumers, it’s more evidence that we can’t simply trust appearances.

Taking financial advice from radio gurus, the Mole, Money Magazine, October 1, 2008

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Giving Away My Old Television

by Flexo on October 6, 2008