Good post by Joe Caiati, writing for dot info:
HBO made it clear that it didn’t care if friends and family were sharing logins, just as long as they were getting hooked on the shows. (I’ll admit, I have a friends login right now that I’m using.) The current problem with it, is that when there is a big season premier or finale – HBO Go dies. It’s unusable. Too many people have given their logins out and millions of unanticipated customers are using the service. When the True Detective season finale premiered on a Sunday evening last year, the HBO Go app was riddled with server errors and the Apple TV app just out-right wouldn’t load. Paying customers who were not home and wanted to watch it were out-of-luck until the following day. And now HBO wants to open up access to millions more.
The price barrier that HBO Now will introduce will help them with traffic, but I think more people than they are anticipating are going to pay and this service has to be rock solid.
Totally agree. If HBO is going to step out on their own, they need to ensure that their delivery vehicle is up to the task. Right now, their customer experience is purely based on the quality of their content. Once someone pays for HBO Now, HBO has to deliver rock solid streaming, regardless of the load on the system.
Despite the recent FCC ruling, I wouldn’t be surprised if cable companies battle this tooth and nail. Get ready for your cable internet service to triple in cost.
I’m not so sure about that, at least in the short-run. HBO’s, HUGE, advantage here is that almost everyone hates their cable carrier, and they tend to love HBO. As long as HBO Now is reasonably good, for a year or so at least, they can get by on sheer good will.
HBO is actually in a remarkably good position. As Caiati says, HBO GO was a great Beta (I’d actually call it an Alpha, but why quibble), and now HBO Now can take the next step with the cord-cutters, which is still fairly small group. They can spend a year working about residual bugs and ramping/scaling issues, and by the time the masses are ready so will the service. Hell, it will take most people 6 months of phone calls to even cancel their Comcast accounts.
I don’t expect them to ‘go gentle into that good night”, but who cares? I also expect lots of municipalities to look into building their own broadband networks. The Cable lobby has managed to get laws passed preventing and/or severely limiting municipal-owned cable companies, but I don’t think those laws prohibit broadband internet. Plus, if we can finally de-couple broadband internet from a cable entertainment subscription, not only does a city or county owned fiber network become fiscally possible, but all those content providers that don’t have super-wide appeal now have an alternative to the traditional cable company carriage contract.
I’m no communist, but I’d almost be willing to approve of my town ‘nationalizing’ TWC’s pipes if it ensured rigorous price/performance competition. That company has proven they are shameless monopolists.
HBO took a huge stride towards this when they signed MLB.com to handle the infrastructure of HBO Now, giving their own in-house efforts the heave-ho.
MLB.com has plenty of experience in the field and has been expanding into providing streaming services for other content providers.
I watched last year’s Wrestlemania live on the WWE network, who also uses MLB.com, with no problems, and an excellent picture quality.
I don’t think I’d want a municipal bureaucracy RUNNING my internet service, but I love the idea of a city/county owning the infrastructure and leasing it, non-exclusively, to providers so they have to compete.
This article makes some a big assumption not in evidence. Let me go over (briefly) the math:
Let X be the number of paying customers.
Let Y be the number of non-paying viewers.
Let C be the capacity of network.
This article assumes X < C but X + Y > C. There’s no evidence of this; it’s just as likely that X > C all by itself.
You have no reason to assume HBO GO has built out its capacity to the point where it can handle all their paying customers at once.
I think we’ll look back at this as the day the concept of a sole-source broadband and entertainment subscription provider went terminal. In the future we’ll have the content creators, the content distributors/providers, and the broadband providers. Consumers will pay the former and the latter, almost on an a al carte basis, and the creators will pay the CDNs a share/fee of what they take i
“You have no reason to assume HBO GO has built out its capacity to the point where it can handle all their paying customers at once.” True, but I assume that the MBAs looking out over Bryant Park know how to run a business. If they haven’t yet, they certainly can build-out to meet demand. This is a new field for them, but HBO has gone from a cable movie channel to a premier content producer the equal of most Hollywood studios. This isn’t their first rodeo.
True, but I would think they’d build for somewhat higher than average load, not peak load.
Better handling of peak loads — at least, making it reliable that people who start watching get to finish watching, and people who are over capacity get a good explanation and message — should definitely be done, though. Be nice if it could dynamically increase as needed, but scaling can be hard even when you’ve done it a million times.
At the rumored price point of $14.99, I’m not sure this will be as big of a hit as many are predicting. I realize that HBO is billed at $14.99 by many cable providers, but that’s merely the retail price. Verizon was offering all the premium movie channels (HBO, SHO, Starz, Cinemax…) as a $20 add-on in many markets. TWC is offering HBO with a basic TV package for $20 in NYC.
When I compare my $8-10 Netflix subscription against HBO at $14.99, it doesn’t seem like a good value. I feel that $10 is the ceiling for subscription services. We’ll see.
Will this be a US only thing?
Yep!
“[V]alue” is a highly subjective term. For a lot of people HBO is all the pay TV they need. More importantly if this works for HBO, the 800 lb gorilla in the room, how long do you think it will be until all the others start offering their own cord-cutter solutions? Which of course is the nightmare scenario for the suits at Comcast.
I think you’re confusing Time Warner Inc and Time Warner Cable. They’re separate companies. As for media conglomerates, so what? If anything, de-coupling broadband internet and cable network content from a cable provider subscription, only gives more of a chance independent content creators.