The Network vs. the Home Media Budget

As networks experiment with revenue models, the market for a slice of the home media budget gets more discerning.

By now, amidst the spread of retail set-top boxes like Roku and Apple TV, most of the major American television channels and networks are offering a streaming service of some sort. The vast majority of them are “free,” provided that you log in via a cable provider, which shows the network that they’re already getting money from you.

Many of these services are far from perfect, but since they’re effectively free, there’s not a ton for folks to complain about — if you prefer watching programs through your Apple TV, or you’re on the road, these services give you a way to do it. If the UX is bad, or the streaming quality is crappy, then you get what you pay for.

…there are four key features a network streaming service absolutely needs in order to survive…

But CBS, the US’s largest broadcast network by audience, has taken a different approach with its CBS All Access offering. Unlike other broadcast networks, and unlike even most cable networks (we’ll get to HBO in a moment), CBS All Access charges $6 per month to stream its content to your device, even if you could get it over the air, even if you already pay for it indirectly via your cable provider.

The Home Media Budget

The cord-cutting phenomenon has been driven almost entirely by price: folks look at their cable bills, freak out at the $125, $150, $200 they’re spending every month, and try to figure out ways to cut back.

I’d guess that most American families start to sweat prices as soon as they move into the triple-digits. If they’re largely comfortable with spending $100 a month on media, and about $50 is going to get swallowed up by a half-decent Internet connection, that leaves about $50/month to go toward streaming services. It’s a slice of this $50 that every one of these services is jockeying to claim.

CBS All Access, priced at $6/month, is saying it deserves 12% of that budget. If we assume that a large percentage of cord-cutters subscribe to Netflix and Hulu Plus (each $8/month), that $6 moves up to 18% of the remaining budget. At a price like that, CBS All Access has to deliver to earn its spot in the home media budget.

Earning a Spot

I watch a fair share of CBS, mostly via my TiVo. As we’ve been considering turning the TiVo off and relying exclusively on our Apple TV, I gave CBS All Access a one-week test drive. I didn’t end up sticking with it past the week, realizing that there are four key features a network streaming service absolutely needs in order to survive as a mass-market paid service.

All the Content

If I’m paying for CBS All Access, I’m generally going to expect access to as much as possible. While it seems to do a solid job with its prime-time programming, I really value CBS News, especially CBS This Morning, which is covered in All Access only via a series of selected clips. A great service here will have access to back-catalogs of their programming,

High Streaming Quality

As top-tier streaming services like Netflix are beginning to roll out support for 4K video (aka Ultra HD), it’s increasingly an expectation that streaming quality be comparable to what you’d get from your cable provider. New services get a pass now and then for a huge event (Game of Thrones premieres, anyone?), but while watching CBS via All Access at a super off-peak time, my wife said what I had been thinking: “is there something wrong with our internet connection?” You can’t get away with heavy compression or lower resolution anymore.

DVR-Style Controls

The ability to play, pause, fast-forward, rewind, and scrub is core to the video-watching experience for almost everyone today. Whether it’s being used to non-network streaming services like Netflix, or just their DVR (a TiVo in my case), we have access to these in almost every context today, aside from fast-forwarding into the future (someone get on that, ok?). Hitting the pause button and finding it disabled just feels like a crappy product. When I was watching CBS live via All Access, I got just that: a live stream, with no pausing, no rewinding.

Timeshifter-Friendly

CBS All Access wins the award for most pathetic marketing-speak I’ve seen so far this month:

From tablets to smart phones, now there is no wait to catch up on the shows you love on the CBS App. Have it all at your fingertips as soon as they’re available the very next day.

I’m not quite sure how “the very next day” jives with “no wait” and “as soon as they’re ready,” but this is just annoying. Coming home ten minutes late for a program shouldn’t exile you into waiting until the next day. This is probably the result of some archaic contract between CBS and their affiliates, but it’s high time to stop selling next-day access as a feature.

The Winners (or, rather, winner)

So CBS missed the mark in the early days of their All Access offering, and I won’t be shelling out that $6 (and I’ll be keeping my TiVo running for now). But there are network-oriented services that do all of the above, and all indications suggest that it’s paying off.

HBO Now

HBO’s internet-only service is reportedly meeting expectations, subscriber-wise, and you could argue that it’s hurt by the fact that its HBO Go cable-bundled service — which is often discounted by cable companies trying to hold onto cord-cutters — is just as great. Full HBO catalog access, live and time-shifted access to new programs, great picture quality, and all the standard controls: if you’re a fan of HBO programming, they do what they need to do in order to justify the $15/month price tag.

MLB.tv

It’s not a network exactly, but MLB Advanced Media’s task in creating a great MLB.tv experience isn’t much different. MLB.tv subscribers have access to nearly every game (fans will grumble with me at the blackout policies, which do need to change), and they can watch it whenever they like, with full DVR-like controls. Even better, MLB.tv provides extra content like compressed games, so you can watch the key parts in about half an hour, and their forthcoming tvOS app looks like an amazing way to watch sports of any kind. Add to all that its excellent mobile apps, and it’s a very compelling option for baseball fans, even at a premium price ($110-130 per season, $20-25/monthly).

That said, you probably wouldn’t be surprised to learn that MLB Advanced Media actually powers HBO Now and is slated to take over the NHL’s media operations in 2016.

CBS has a lot of work to do if it wants to earn a $6 slot in our family’s budget. Meanwhile, our nearly decade-old TiVo Series3 can keep its job at least a little while longer.