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Week In Review: Charter’s Apple TV Deal Is Nothing Like Cord Cutting, Amazon And Live Sports Should Scare Everyone

1. Charter’s Apple TV Deal Is Nothing Like Cord Cutting

Charter made some relatively detail-free statement about allowing subscribers to use an Apple TV instead of a cable box and all the usual suspects are doing little dances and cheering about how Charter is “making cord cutting even easier!!!.” (That’s an actual headline—Google it. Because you just can’t make this stuff up.)

Why It Matters

Now of course nothing of the sort is happening.

First off, there’s the fact that Charter has had an app for a while now for various and sundry connected devices, and said app has a limited channel selection and awkward functionality and nothing has been said about why the Apple TV app would be any different.

Then there’s the fact that you need to have at least one Charter set top box in order to use said preexisting app, and they have not said anything about eliminating that requirement.

Then there’s the fact that Charter does not yet have a cloud DVR. So if they’re not planning on launching one (the fact that they haven’t announced it is a good tell that they’re not) you’d either have to get a separate DVR device or a set top box.

Then there’s the fact that Apple TVs cost $179. Each. And if you have say, three TV sets in your house, that’s $537, at which point most people are going to be like “Yeah, I think I’ll keep your crappy set top box anyway Charter, kthxbye.”

What’s baffling is why Charter doesn’t just launch its own vMVPD, a mesomorph bundle type service like Hulu Live TV or YouTube Live and bundle it with their broadband service and some kind of branded Roku stick or Amazon Fire stick for a price that way undercuts everyone else in the vMPVD market.

Okay, that’s not true.

It’s not the least bit baffling. We know exactly why they’re not doing it: they’re scared it will become way more popular than their set top box based service and cut deeply into their profit margins. And that it will make their carriage fee and retrans negotiations even harder. And that they won’t be able to get most of the local affiliates on board.

So much fear. So little long term thinking.

What You Need To Do About It

If you’re an MVPD, you need to do something— walk on hot coals barefoot, down a bottle of tequila—to get past your fears. The future is coming, like it or not, and vMVPDs are the future, so you better get on board. You could own that market with your monopolistic control of broadband access, but that’s only till 5G becomes more real, so act now to take advantage of this limited time offer.

If you’re a network, you need to get on every vMVPD you can, because we’re at the point where if you’re not on there, and there are 100 channels that are, people will just find something else to watch. (Gave that advice to someone affiliated with PBS earlier this week. I like PBS and so I hope they take it.)

And if you’re writing about TV, remember that just because you watch TV doesn’t mean you understand the business. It’s complicated and it’s easy to make mistakes.


2. Amazon And Live Sports Should Scare Everyone

Amazon won rights to livestream some UK Premier League games over the next three years, just 10 matches total.

Yet the notion of Amazon and live sports should strike fear into the hearts of network executives around the globe.

Why It Matters

It’s not just that Amazon can now serve up video ads (though that’s a big step for their Prime video service). It’s all the stuff they can do on their platform, where people don’t even realize they’re seeing ads—like the in-supermarket display for cheeses of Switzerland, people think it’s just something nice the company is doing for them, putting that Hotspurs jersey on their home page where it’s easy to find it

But advertising is exactly what Amazon is doing, along with a whole lot of merchandizing.

So they can put those Spurs jerseys on viewers Amazon home pages, and figure out when they’re most likely to buy them and at what price.

If Coke ran an ad during the game, an offer from Amazon Pantry for 20% off a case of Coke might appear on viewer’s home pages the next day and few fans will ever connect the dots.

Plus Amazon now has all sorts of data on the buying habits of fans who watch Premier League games and can likely figure out which team they root for. (To better understand the potential value of fans to sports teams, check out this piece on Vertical Mass.)

Those are all things that traditional networks can’t do and reasons why they should be worried about Amazon horning in on their sports broadcasting action.

What You Need To Do About It

If you’re a network, remember to emphasize how few people actually watch Amazon Prime and how unlikely they are to turn to Amazon to watch sports. (For now, anyway.)

You’ll probably also want to write your Congressional reps (and/or the President) about your support for an antitrust investigation to break up Amazon.

And if you’re an advertiser or the marketing team at a major sports league, you can rub your hands together with glee at the thought of all that GDPR-compliant data that will be coming your way.