In the linear video business, scale really does matter, in part because it is easier to amortize marketing expenses and operations, but also because programming contracts have a volume element to them. That is one reason why small providers of linear video have had a tough time making a business case.
Consider the difference between what AT&T had been paying to support its U-verse video business, representing about 5.9 million customers, and its DirecTV asset, with 19.6 million customers. According to AT&T CEO John Stephens, U-verse video customers pay $17 more each month in programming costs than those on the company's newly acquired DirecTV platform.
No comments:
Post a Comment