Good morning, All,
First, our thanks to Wiley Cerilli from First Round Capital, who spoke at our breakfast last week, when we ourselves were hoarse and could hardly speak. And our thanks to all of you who came out for it.
Our next Breakfast with an Investor will be on April 16th, with our guest investor Kelly Hoey. Speaker, strategist and investor, Kelly Hoey is known for her leadership in building valuable professional networks, understanding the dynamics of engaged communities and the “how” of raising visibility, online and off. She is also recognized for her “boots on the ground” leadership in the startup community by her investments in and promotion of women in tech. More on her below, and register here.
We had flu this week, and not a lot you can do when you have the flu, besides, sleep, drink plenty of fluids, and watch TV. Good time to talk TV.
Apple just announced the new Apple TV: “Think TV, music, apps and a little bit of home automation as well,” and just $30-$40/month for the service, which will include some 25 channels. Each streaming service has its own bundle of networks/content and there’s now quite a menu to choose from, between Hulu Plus ($7.99/mo), Netflix ($8.99/mo), the web, antennae, Amazon Prime Instant Video, Sling TV ($20/mo), CBS All Access ($5.99/mo) and come next month, HBO Now ($14.99/mo). Available only on Apple TV, at first. Note to self and streaming services: all those numbers add up to Cable Pricing. Careful there.
Of course, what Apple TV announcement would be complete without articles about cord cutters – those people who supposedly no longer want to be tethered to a television and who want their content when they want it, on the devices where they want to see it. Great sound bite, but seriously?
Believe it or not, traditional cable operators are perplexed about the growing number of cord cutters, according to one article we saw. and we understand their confusion: everyone goes home eventually and in many households, relaxing and watching some television at some point in the evening is practically a knee jerk reaction, and we’re frankly a bit tired of hearing that it’s This New Breed/Millenials Who Are Changing Everything. Time to clear up the confusion: the average cable bill is now about $123 a month, and expected to reach $200 a month by 2020. As a former tethered TWC subscriber (sans the premium services, which put our monthly bill well over $200), we will say that our bill was already in spitting distance of $200/month, before we cut the cord last year. Then there’s the fact that, according to the FCC, the price of cable has risen an average of 6.1 percent a year since 1995, compared with general inflation of 2.4 percent a year. What to speak of the hidden surcharges that the cable operators constantly add: our total bill increased more than 6.1 percent, that’s for sure, and it’s no secret that prices have also been rising steadily to make up for the lost customers. Cable operators have their numbers to make, and the circle goes unbroken (BRUTAL: 50% Decline In TV Viewership Shows Why Your Cable Bill Is So High). It’s insanity. Since untethering, our bill is considerably less than half of what it was, even with the streaming services, which we do pay for (Hulu Plus and Netflix), included.
As a side note: we have friends who were paying comparatively high fees as TWC subscribers (considering that TWC offers new subscribers $99/month). They would call and threaten to untether and voila: TWC would offer them that sweet deal. Not that we didn’t try this as well, but we are not in the same age demographic as our most-likely-to-untether friends, and no deals were offered, despite the fact that we made several attempts. We fall more into the demographic of people unlikely to cut the cord. Oops. Guess they misjudged that one, but the question remains: is there unfair pricing, according to age? Just thought we’d put that out there.
While the long awaited Age of Streaming is finally coming into its own, the math doesn’t work. The content providers seemed to have gotten the wrong memo. The average household – even the early adopters – will not subscribe to all of the services, and if the johnny-come-latelies are comparing their pricing to the cable services, which seems to be the case, and believe that they are therefore providing value – big mistake; wrong metric. Their competition is the Hulus and Netflix of the world. Sorry, HBO Now, but $15/month? The 90s ended long ago: the cord cutters have no intention of landing back in Cable Pricing Country. It seems to us that the he content companies are not skating to where the puck is going, as many articles indicate, and uthat nless they realize who their real competitors are, they’ll soon find that they’re skating on very thin ice. Onward and forward.