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Streaming for Rio Gold

8 Aug, 2016 By: Erik Gruenwedel

Most online ‘skinny bundle’ TV services left out of the action

Cord-cutting apparently is not an Olympic event.

With Comcast shelling out $1.23 billion for the exclusive broadcast and digital rights to the Games of the XXXI Olympiad currently under way in Rio de Janeiro, streaming the Games via online “skinny bundle” TV is mostly a non-starter — like outkicking Michael Phelps in a swimming pool.

NBC Universal has made 4,500 hours of live broadcasts and on-demand Olympic video content available to stream, but doing so mandates a pay-TV subscription. NBCOlympics.com and the NBC Olympics app afford live (ad-supported) access to events, but largely as TV Everywhere conduits. 

Perhaps by design, Comcast kept NBC from Sling TV, Charter Spectrum TV Plus and PlayStation Vue — with only the latter’s most-expensive $44.99 Elite Slim package featuring NBC sister stations (and select Olympics content) NBCSN, Bravo, CNBC, Golf Channel and USA Network — but no primetime coverage via NBC.

The decision seems odd considering NBC found — via internal research — that the more access video points viewers have to the Olympics, the more coverage they watch — on primetime TV.

“The unvarnished streaming during the day acts as a barker channel,” Alan Wurtzel, president of research and media development for NBC Universal, told . “People see an amazing thing and call their friends — ‘Did you see what Michael Phelps has done?’ — and they watch at night.”

Skinny Bundle’s Fattening Price

The idea behind online TV was to attract pay-TV cord-cutters with access to 20 premium channels and select broadcast for a price significantly below the traditional cable bundle.

With channels such as ESPN, HBO and others included, online TV’s $20 price, coupled with relatively inexpensive broadband, seemed like a great deal. And it was, until multichannel video program distributors — which control most of the nation’s broadband distribution — began raising the price of high-speed Internet service in response to shrinking video subscribers.

Charter, for example, has doubled the price of broadband from $29.99 monthly to $59.99 in just two years — calling the former price an introductory offer. When combined with online TV, Charter’s cord-cutters are actually paying $79.99 — for fewer channels.

Indeed, the standard Spectrum TV Select option includes 125 channels, broadband and DVR for just $10 more. Dish Network last week bowed a satellite TV bundle for $39.99 offering 50 channels — and no Olympics. The Games can be accessed when acquiring one of eight add-on channel packages priced from $4 to $10 monthly — arguably the least expensive pay-TV option watching the Olympics.

To Wedbush Securities media analyst Michael Pachter, ISPs have consumers over a barrel. He said subs get lulled into a “sense of need” with a low-cost bundle because providers don’t disclose the individual component price.

“Once you’re bundling services … it’s a way for ISPs to obfuscate individual components of a bill,” Pachter said.

The analyst said most consumers have no idea what they’re paying for. A state of confusion amplified when attempting to alter or change service. Pachter says consumers will never do without — characterizing the lure of broadband provider with the former status of a checking account at a bank. Wherever you banked, you also got your car loan and home loan there.

“Wherever your high-speed Internet account is, that provider wants to be your MVPD,” Pachter said, adding that broadband options are largely limited to cable and telecom.

“There is no other Internet. There’s no incentive for either to drop their [high-speed Internet] prices.”

About the Author: Erik Gruenwedel

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