Breaking the STB deadlock in the USA
The current discussion in the US market about what the Federal Communications Commission is proposing for the US STB market is interesting because I think it is trying to address an issue the wrong way. When I look at most of the grief that consumers seem to express it is around the fact that they have to pay through the nose for the STBs and that they are renting them rather than buying them at some reasonable price.
I've worked with and talked with operators worldwide and never seen customers screwed over so much as by the US operators. It seems to be that it would be much easier to get the cable companies to be more reasonable in their charging for the consumer devices because that kind of model works everywhere else in the world. So why isn't this being challenged instead of just trying to fragment the STB market by breaking it up with a confusing technological solution?
Perhaps the FCC doesn't think it can solve the problem without directly interfering with the commercial operations of the target businesses and they don't have the appetite for that? But I think that consumers will suffer if the operators are required to support any other vendor in the free STB market. Perhaps as a STB guy I shouldn't be saying this because opening up the market would leave massive opportunities for new suppliers to come in and create a new economy. But I think it is a lowest common denominator battle that would need massive quality control processes to ensure consumers don't lose out.
The pay TV companies could continue to innovate and offer the best device, but maintain the premium pricing on the devices. Advanced services would only be available on the operator sourced boxes and so they become the de facto box, or consumers lose out on having services because they can't afford the 'genuine' box. If there was better competition in the market and pressure to remove arduous charges for equipment, then consumers would benefit. Until there is more choice in the market then these pressures won't happen. A complex technical solution is never the right answer to a commercial and political problem.
Technology and Business Development at Huawei Technologies (UK) Co., Ltd.
9 年While I can see at a high level what the FCC is trying to achieve, I am not sure that the initiative they are currently trying to implement is the right answer as it will only move the pain point to something else. We do not have much "choice" here in terms of internet or entertainment service providers, but there does not seem to be any "provider specific exclusive content" that seems to be the cause for regulatory action as has been seen elsewhere. The leasing/renting philosophy is significant across other sectors here in the US, primarily for the "I don't want to own something I cant understand" and/or "I don't want to be left with ancient technology", as long as that is agreeable to 80% it will be the only option for the other 20%. The STB is (unfortunately) the safe edge of the entertainment/media network,and only if there is a suitably un-bundled internet service (as in a utility service like GoogleFibre) then we will continue to see STB rental and capacity caps on bundled internet packages. Such a utility service is happening in some of the more densely populated areas, but its unlikely to reach to low density suburban areas that are already built out. That said, 5G adoption along with media coding improvements will certainly make households more accessible to mobile network operators, perhaps then we will see some changes in television and internet service offerings then!
Experienced business development, marketing & creative executive
9 年In the Belgian market you (Telenet I believe) the box was a one-time-purchase...In the French market the Satellite company was renting the same STB to French people for around 8 Euros/month for years and years and years and made a handsome ROI on their initial Capex. Let's not forget that these are businesses not charities and you can scream all you want that the consumer is being ripped off but just look at all the other businesses out there that are doing the same...Bank charges!!!!! Credit cards and interest rates...Just look at food and the profiteering, look at cars and higher leasing...look at utility companies and they are ripping everyone off. Why is it that we suddenly feel hard-done-by in the TV space? Marnix a choice of three ;-) (that is a competitive option right there) ... here in Switzerland its 2 - UPC or Swisscom ... I am paying a HUGE bill for access to Broadband, TV and the SITEL (Tax) - HUGE. The USA is not the only place where costs for TV access is high. We will all be getting TV from a central repository soon called Amazon - check this out to see who is going to rule the world of digital in the not so distant future: The Gang of Four https://youtu.be/jfjg0kGQFBY
M&A. Early-stage and Growth Capital for Tech Startups. GenAI, AI Agents, Crypto, Quantum Networking
9 年Couldn't agree more on customers in the US being taken advantage of. Let's not forget, however, the benefits of open competition in the STB market. With a swift pen stroke, the FCC is not only trying to breakup a defacto monopoly but also provide users with a valid device choice. Perhaps wouldn't worry about an operator's capacity to evolve and adapt (the ones that want to stay in business that is). Briefly entertaining a parallel to the mobile devices market, customers/users would rather have choice on open and non-exclusive content to a specific operator or device manufacturer; operators will have no other choice but to offer adapted differentiated services on common place devices.
Telecommunications and Technology
9 年Marnix, I don't know how much experience you actually have with the US market, but consumer misperceptions aside, the retail market for video here is highly competitive -- as in MVPDs lack pricing power. The market is as it is because the wholesale market for video is broken, with single-source programmers enjoying an enormous leverage imbalance in negotiations with multiple competing distributors. You're right, however, that changing the end device is not likely to change pricing. Distributors (who at this point are working with very thin margins) are going to charge what they can given competition, and we should expect total price to be fluid between service and equipment fees. As for differences between non-terrestrial-broadcast video in Europe and the US, the two markets grew up completely differently (Europe driven predominantly by free-to-air satellite, the US driven by subscription-based cable), and remain quite different today. One has to be very careful in trying to draw any conclusions by comparing them.
Education Industry Information Technology & Services
9 年Ha ha ha. Remember Sony's Passage! Supposed to put a Sony box on any network. Still waiting.