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Originally Posted by Shoe Lace
Not too long ago something like this actually happened.
My cable provider (cablevision) dropped Fox and UPN for a bit because those stations demanded more money for their service. My provider said no so the service was dropped. About a week or so later they were back on and the cost to us did not go up.
I'm guessing Fox and UPN both realized they were being dbags and finally agreed that x profit is > no profit.
Knowing the details of this particular negotiation, your guess would be incorrect.
And to clarify - the content owners were demanding more money for their content - not to get into crazy detail on it - but basically, before this negotiation, the Fox Network/Studios got $0 from Cablevision to distribute FOX programming on the FOX Network. So I hardly think it's fair to call FOX "douchebags". Especially when Cablevision was charging the consumer on average something like $1/sub/month for FOX Network - think it's only fair FOX get some of that money.
And your Cablevision bill will go up. I'm fairly sure Dolan said publicly that if retrans fees to stations (new payments for Cablevision) continue to happen, they will pass the cost on to the consumer (Time Warner Cable has definitely said this).
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The same can be said here. You really think Starz play or any other content provider is going to turn down potential profit from Netflix because TW is forced to pay more due to a more inefficient setup and higher costs?
I think you are very confused here - I tried to make it clear above. I'm not sure what you're sayign to be honest.
So Bewkes is talking from 2 POV - the first is as a distributor (in direct competition with Netflix) - the second is as a producer of content that earns license fees by making deals with distributors.
Starz is one of many content producers/providers that will force Netflix to pay more money for their content. Therefore, since every content producer will ask for more money from Netflix, it only stands to reason that Netflix's cost structure will go up, and that your consumer prices will go up. That is the only point I'm making w/r/t Netflix's business model.
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The only thing we have to worry about is all broadband services banning access to Netflix.
You don't have to worry about this. Google "net neutrality". The ISPs may make it more difficult for Netflix to be distributed on their pipes by charging them more than a comparable service, but they will never be able to unilaterally block Netflix from doing business.
-Al