The TV Everywhere Tax
Pay-TV operators have rights for some but not anywhere near all the programming and content that consumers get at home with their subscriptions. Several MSOs offer video-on-demand (VoD) titles to iPads and other devices for out-of-home viewing, while a few others also provide all or a subset of their live TV lineups to those devices ... so long as they are being accessed within range of their home's Wi-Fi signal. And some cable channels, like ESPN and CNN, offer access to their linear TV feeds via their own apps, with the catch that the customer must also get service from a pay-TV provider that has the right kind of carriage deal.
So, it's as clear as mud. There's no uniformity to any of this, leaving consumers to guess or spend time hunting down what sort of TV Everywhere content comes with their TV subscriptions. It's a wonder that everyone who wants to get their TV on the go just doesn't go out and fork over $300 for a Slingbox Pro HD and call it a day. EchoStar Corp. LLC (Nasdaq: SATS), Sling Media Inc. 's owner, would thank you for that, but it's not realistic.
Enter NimbleTV , a small startup that wants to help cable operators, telcos and satellite TV service providers bridge the TV Everywhere gap by obtaining and paying for these rights. It intends to do this by provisioning set-top boxes in its own facilities, transcoding the pay-TV signal to IP, and then streaming those signals to subscribers -- essentially offering a Slingbox-in-the-cloud. It's sweetening the pot with a network DVR service and doing all this for a monthly fee that NimbleTV's pay-TV partners, in turn, would charge their customers. (See NimbleTV Takes Video Subscriptions Over the Top .)
NimbleTV isn't revealing whom it's working with for its beta test in New York City (it also has plans to launch a similar service in India), but given how skittish cable operators have been about Slingboxes and, in general, about programmer copyrights, I'll be surprised if NimbleTV can get any major MSOs to play along. NimbleTV insists what it's doing is legal, but I'm guessing that a company like Comcast Corp. (Nasdaq: CMCSA, CMCSK) isn't going to take such a risk.
But, the emergence of NimbleTV and its model does start to put a price on TV Everywhere. In the early going, MSOs have offered their TV Everywhere content (as limited as it is) as a "free" addition to a customer's pay-TV package. But how long will that last? Programmers want more money for TV Everywhere rights, and the MSOs, though reluctant to overpay, will probably still have to pay a bit more for those rights. So it follows that the operators will have to pass those costs to customers who want a TV Everywhere experience that's worth something.
And how much will that be? NimbleTV hasn't revealed pricing yet, but told the The New York Times that it could be in the range of $20 per month. If that's the case, then we are starting to get a sense of the premium pay-TV customers will be expected to pay when TV Everywhere actually means the replication of all the live and VoD content that customers get at home, rather than the relatively meager amount of content that makes up today's TV Everywhere offerings.
Whether it's thanks to help from a company like NimbleTV or via the negotiations the MSOs are doing on their own, is $20 a fair premium (tax?) to pay for remote access to your entire pay-TV service? If not, how much would you be willing to pay, if anything?
— Jeff Baumgartner, Site Editor, Light Reading Cable