That's an interesting perspective, but it kind of looks like a lot of graphs saying "You should pay for stuff you don't want because otherwise it would incentivize the sellers to price gouge you for the stuff you do want"
I'm kind of confused, if it's an adversarial relationship where the seller is going to extract as much money from you as possible in either scenario, wouldn't some consumers prefer to pay specifically to starve out content they'd prefer not to see?
Maybe I'm not understanding this page, but it looks like it's "good" for me because instead of paying $9-10 for the History Channel alone I'll be paying $11.70 for History Channel + ESPN (which I will literally never watch)?
I'm not a calculus genius but I'd prefer to spend less money and only have what I want. This model assumes that I'd be willing to spend $3 per month on ESPN, but how does the graph look if I were willing to spend $0 per month on it? Or hell, since pricing is arbitrary, I'd like to pay -$3 per month as a courtesy for having to scroll past content I genuinely do not want to consume let alone subsidize?
The argument is not about your buying preferences as a consumer. Of course if you had a choice between (a) paying X for watching stuff, or (b) paying Y for the ability to watch exactly the same thing, but Y is overall less money because it is somehow dependent of the amount that you consume, that is the better choice.
However, the economic equilibrium of a perfectly unbundled system is not that you get to watch the same thing for less money. It is, in the general case, that you either get less content, or pay more, or both.
To take your example, realize that it is outlier behavior to be willing to pay $9/mo for History and $0/mo for ESPN. If you took History channel, with the content that it has now, out of the cable bundle and tried to sell it $9/mo, or even $1/mo, there would be way too few interested customers to make such a proposition economically viable.
In a perfectly unbundled world, content such as the History channel does not exist. You only have marquee content like ESPN, movies for rental or purchase, or (if lowercase history is your thing) highly produced documentaries, i.e. the kind of content that willingness to pay for is high enough to justify the high customer acquisition cost. You do not have content like History channel because it lies in that tier of things that many people are kind of interested in watching, but only if it comes with something else more valuable that they already paid for.
One can debate the societal value of the existence of content such as the History channel to begin with, but that's what the argument is about, not about the consumer's individual preferences in a hypothetical world where it would be possible to watch the same content for cheaper.
This misunderstands the market. I would pay for the History Channel but I wouldn't pay for ESPN. And I won't pay for a bundle because then 'analysts' will think I'm getting it for ESPN.
History Channel is cheap to make compared to sports, would definitely be able to pay for itself with cheap subscriptions.
Cable TV with bundling is just a local maxima established decades ago. The long tail of interest that drives regular youtube is the proof.
If this misunderstands the market, I'd be interested in a positive proof of a channel like History making it as an independent offering. I don't personally know of any.
> You do not have content like History channel because it lies in that tier of things that many people are kind of interested in watching, but only if it comes with something else more valuable that they already paid for.
This seems like you're saying "bundling mis-serves the customer." If the History Channel would not exist if people could pay for it directly, then why should it ought to exist?
The idea the article is trying to get at is (I think) that people are willing to pay for the history channel, but as long as they're more willing to pay for some other channels, studios will just jack up the price of the other channels to the point where their funds for discretionary spending on television are exhausted very quickly. This is because it's cheaper for the studios to get people to pay more per show while producing fewer shows, as this increases their profit margins to the maximum they can get away with. The argument that this is bad for consumers is pretty straightforward, but I will point out that these incentives only work so long as consumers have no choice about their cable provider. i.e., the problem is that cable providers are monopolies, not the bundling specifically. Moreover, we've clearly seen over the last two decades that these monopolistic practices have driven huge numbers of people away from television... unfortunately, usually the competition requires the internet, and the same cable companies control internet access, so there's no particular reason for them to change their business model.
That's what I meant by, we can debate the merits of the History channel to begin with. I only took challenge to the notion that there is a world in which unbundling happens and consumers get to watch the same content for less money.
Whether or not it is "mis-serving customers" depends a bit on whether there's abuse of monopoly power, which is an argument one can make about the cable companies, but not so much about the over-the-top services like HBO Go, Disney+, Netflix, or Prime, all of which are structured as a bundle. I'm not sure Prime customers, for example, are unhappy or feel mis-served by being able to watch TV shows on top of being able to order items with fast, free shipping. Bundling can be used for nefarious value-extraction in a monopolistic market, but it can also bring consumers value, so we shouldn't conflate the two.
In many competitive markets, bundling is often a consumer's preference that does serve customers well. For example, most coffee shops don't charge for sugar, creamer, and other condiments, and you maybe have some aggrieved consumers complaining that they should get a discount for drinking only black coffee. It's likely that coffee creamer companies would go bankrupt if people had to pay for condiments at every coffee shop, and we can debate whether it's even a good idea then. But on the whole, I don't think that turns into an argument that coffee shops are mis-serving customers by providing condiments that are free of charge, that is to say, bundled with the price of coffee.
Personally I live in an almost perfectly unbundled world of content already, because I tend to buy or rent the TV shows that I'm personally interested in. This works for me because I have little time to watch, don't like ads, and have enough disposable income that I'm not thinking twice about cost, but I'm not sure that many other consumers would be satisfied with the kind of entertainment experience where they have to pay $2 per episode of their favorite show.
You aren't going to be able to spend less money though. Since there's zero marginal cost to adding extra channels, you should assume that the price you're getting charged isn't actually based on the number of channels you subscribe to.
A better way to think about bundle pricing is that the channels you really want cost $50, and they throw in a whole bunch of other crap for free. Why turn down free stuff?
If those channels are free (and by that reasoning, not actually factored into the price of my package) then why am I unable to get individual channels or create my own bundle? Either I'm subsidizing stuff that I don't want to watch, or I'm not.
Is your point that I can't spend less because... they're going to get $50 out of me either way? Except that's impossible because there is no other way so there's literally no way of knowing a theoretical cost so it's safest to assume it's going to be $50 or more?
The parent comment lists a specific reason why they'd turn directly the 'free' stuff. It requires more effort to then access the content they want to get to when they have to navigate around the cruft.
Whether that factors much into your personal value assessment or not, that is a valid downside to having a bunch of extra channels you don't intend to watch.
People don't turn down free stuff. It's just that they no longer value the content provided via TV channels at the price they are asking. The fundamental problem is content that used to be delivered via TV is no longer worth what it once was.
That seems like an awful lot of assuming. Even if it's true that they needed to raise the price of their existing channel offering, and only added new channels to help justify the price increase, that still counts as bundling being used to increase the price.
Anti-bundling rants based on subsidizing unwanted channels are illogical. You're annoyed at paying for cable channels you don't watch but OK paying full freight for Netflix where you'll watch less than 5% of the available content? You're subsidizing the other 95%! Or that a-la-carte channel you want, you won't be watching it 24 hours per day so why subsidize programming that's on when you're sleeping or at work? Do you listen to every genre on Spotify? Use every machine at your gym? Drive on every road in your town? Read every article in the local newspaper (if your town still prints one)? Refuse to subsidize! Demand some money back!
Its not unbundling you really want, or a-la-carte, it's just a lower price tag.
> Or that a-la-carte channel you want, you won't be watching it 24 hours per day so why subsidize programming that's on when you're sleeping or at work?
You have correctly identified the business case for cinema and DVDs.
And buying DVD's is a terrible value compared to a service like Netflix, so congrats, you just reinforced their point.
Like, a single movie DVD/Blu Ray costs about as much as an entire month of Netflix. Unless you're hardly watching any TV shows or movies on Netflix, that's just an awful value.
I can get an entire season of one of my favorite TV shows on DVD at the used bookstore for an average of $15. Not only does it usually take me a month to go through the 24 episodes in a typical season, but there's special features to enjoy and I can re-watch the show at any time without paying for it a second time.
There's something about your use of "correctly" here that seems hostile, arrogant and antagonistic. This isn't a quiz, nobody was even talking about movies or DVDs, and I certainly wasn't seeking "FeepingCreature"'s validation.
The cinema business case is “going out” “big screen” and “new release” but this could all be disrupted. It’s not a payg model that attracts people to the cinema and many movie chains have a subscription model!
There are certain channels whose content I feel causes societal damage. Namely, Fox news. Id happily pay a buck or two more to ensure not a dime of my bill subsidizes that channel.
I'm not sure about other people but I don't "think" I want a la carte, I absolutely know I do. So much so that I don't pay for anything because nobody offers what I'm willing to pay for.
It's like saying that you'd be willing to pay for a $2/month Spotify subscription for only the genres of music you want. That's not how the economics work. Going a la carte would mean paying as much as a bundle, for less content.
The problem here is that people's mental models are fundamentally self-centered. They imagine paying half or less for just the channels they want.
But in total, that would mean media companies getting half or less the revenue, for producing the same content -- since the marginal cost of giving extra channels is basically zero, they don't gain any money back by giving you fewer channels. Now, media companies aren't that profitable, the math simply doesn't work out, they wouldn't be able to actually make all that content. Many channels would simply be cut.
Spotify pays artists based on the number of times their work is played, so that comparison isn’t valid. Most people have no trouble paying $10/month for what they actually use - and if the $50/month for cable was divided similarly I’m sure there would be far less complaining.
Of course, broadcast technology doesn’t support that and we have decades of industry built around a different model, giving all of the incumbents a strong incentive to resist any sort of change.
>Going a la carte would mean paying as much as a bundle, for less content. //
You're arguing past people. Plenty have said they're fine paying the same or more for access to less content.
I used to watch about 2 shows a week on BBC (UK; 1-1.5hrs) and disagreed with paying £M to TV show presenters who just preside over long, talky adverts for Hollywood movies and mainstream media. So I don't pay (nor watch) anymore.
I'd pay to watch those couple of shows separately. As it happens though they occasionally make their way to Netflix, so I don't have to ... but I'd still pay to watch them when they're still current.
Looks to me like there's money left on the table.
Personally I'd like to see some form of legislation that requires shows to be made available to consumers if they are available to other channels - I could pay double to BBC what Netflix pay them to get the show and we'd both win; and I wouldn't mind having it on Netflix, might watch it again.
Now BBC is a special case; I can't work out why they need to compete commercially, nor why we allow showmakers to form companies to be paid through, etc.. they should work on salaried staff paid on civil service pay scales IMO.
> Plenty have said they're fine paying the same or more for access to less content.
Really? I haven't seen anyone say they want to pay more for less content. The unspoken assumption always seems to be "if I was getting fewer channels I'd be paying less", logic which works fine for tangible goods, but less so for ones with nearly zero marginal cost to produce.
I find it funny that people are arguing that you don't want this and actually want bundling services when you're flat out saying you aren't currently paying for what's being offered.
I don't even want a la carte, I'm fine with just "It's on Netflix/Hulu/HBO Max or I don't need to watch it." I'm not willing to pay more than $20 a month for TV most months, with the rare extra service to get caught up on a show I really like.
At least for me, I find that unlikely. I'm paying a fee for sports channels I have no interest in (because you can't not pay it), I'm buying a bundle that I only want a couple channels in, and those are the channels most people want. I would guess that I fall into the majority that are subsidizing the minority.
I'm not a professional economist, but to my eye this assumes that if I'm willing to pay $10 for one channel and $3 for another, I'm willing to pay $13 for both. This seems like a bad assumption especially for media, because since TV channels serve as substitutions for each other; if I watch one I'm not going to watch another. I'm not sure if this simplification preserves the results.
I’m actually more of a fan of a la carte content than channels. I typically spend $0-100/mo on TV shows and movies, which I strip the DRM from and copy into my permanent collection. In aggregate, I probably spend something comparable to what cable would cost. It’s all content I want with no filler or commercials, and I’m not held hostage by some subscription.
That article is an absurdly oversimplified model. In the real world, the networks would find some way to diversify between the $3 and $10 channel offerings, letting them get $3 from the $3 person and $10 from the $10 person.
edit: Correction, they do mention this common and widespread approach... in a footnote. Without saying anything about why it wouldn't work.
In context it should be very easy to see why I phrased things the way I did. I do not personally think there's anything EXTRAORDINARY about US population size OR the budget amounts in question.
I'm curious if you see 3rd party vendors being useful in this space. e.g. one person consultancy that can use Retool to quickly build out internal apps for other orgs that aren't able to get any internal dev resources
Have you seen the iPhone pricing strategy? Yes they’ve moved up asp for the high end but are also now selling a $400 phone with chips that outperform anything else in the Android market. It’s very likely some of this margin will be shifted to consumers
Apple’s pricing in the services world: extraordinarily competitive low end to lure you in. Excessively-margined high end halo products. High margin, but attractive in comparison middle tier.
That’s not really “data points” in any useful sense of the word. The sim3 community could be a few thousand people - still large enough to be a community where this came up as a noticed issue, but not meaningfully large in any real sense as far as Apple is concerned.
Sure, I don't say that Apple should do X op Y. I just wanted to present some example of people that game on Mac, because some people in this HN forum would think that gaming means only latest AAA games or console gaming. There are people that don't have a dedicated gaming device, they are not that many as percentages but they exist and they are affected by the 32 bit drop and other backward incompatibility updates.
So it is possible that this people when they buy a new laptop would not buy an ARM Mac buy a Windows one to continue playing the casual or old games - sure Apple can ignore them because as percentages is nothing for their giant vault of money.
Since everyone else is replying to hate on this machine, want to throw in that I loved it. My situation maybe wasn’t typical, but living on the road it was such a joy to have something that for all purposes disappeared into my pack and was totally capable for my basic needs. This style body w/ better arm chip is for sure future of “gen pop” Apple laptops.
Diet is so much more important for weight loss / maintenance than exercise. You can obviously have a healthy diet that does not include IF, but for most people they need to do something about their diet, and can’t just add exercise.
For most people, I tend to agree. A big part of The Obesity Code is unpacking the reasons why. One of the reasons is debunking the perception that weight loss is simply about calories in and calories out.
Another part of the story is showing the feedback cycles between glucose, insulin, and insulin resistance. I made a line art drawing as a gist, here:
https://cdixon.org/2012/07/08/how-bundling-benefits-sellers-...
Stratechery also has written about this