Thursday, March 7, 2013

Still want 'unbundling'? MultiChoice is actually already showing you exactly why you will pay 'less' but will actually end up paying more.


It's the modern consumer paradox: We all want more, want to pay less for it, want it really cheap, but have it be great quality - and we want a lot of choices without the mere supply of more choices making it cost more.

When it comes to pay-television subscribers can't understand why they can't be allowed to pick individual TV channels and only pay for the ones they want ("I only want the ones I want to watch"). And why not? Well, the model of subscription television is that it's sold like a necklace - the necklace is the product, not the individual beads.

How many individual small beads must be sold before it becomes worth your while, your time and effort? It's more economical and practical to string them together and create a whole new collective creation and sell that as a product on which you can have an overall mark-up and make a profit.

What is a spider's cobweb - and why is it successful? It's because as a collective of individual strings it becomes something else in itself - it's own functional bigger thing. A single cobweb strand can still catch a fly - it's just than much harder.

Sp perhaps don't pray for so-called unbundling.

If you get to pay for individual TV channels as part of a pay-TV service you will definitely be paying less than for a bouquet. That is absolutely correct.

But as the details of MultiChoice's latest subscription tariff increases coming into effect from 1 April 2013 actually reveal if you study it closely, it is that a quality or highly desired TV channel can cost as much as several other TV channels combined.

Yes, you will pay less overall for just that TV channel or TV channels you want, but your pay-TV operator will charge you a bigger premium on it.

Read, at your leisure this insightful article about the unbundling issue which was published in The Wall Street Journal just a few days ago on 28 February.

The thought-provoking bit for me is the part of "a la carte - maybe a little counterintuitively - raises prices and reduces choice because it increases the costs," and that pay-TV media companies in America are [and of course they're arguing from their own best interest point of view, although it is actually true and makes sense]are feeling that "a lot of money would be siphoned out of programming investment and into marketing because there wouldn't be assured distribution."

"Executives at media companies say they would be forced to raise prices on their channels to maintain how much they spend on sports rights, original programming and other content" if they were forced to somehow break subscription TV channels into individual channels.

But do yourself a favour and read the full article for yourself.