The screwing game: Cable companies vs Fred Wilson
Perenially on the cusp
Fred Wilson on AVC recently wrote a blog post about how he ended up 'illegally' streaming a New York Knicks match because there was no 'legal' way for him to pay for it without actually going to the match. In that situation he had been willing to pay even $25 for the priviledge. The post is aptly titled #screwcable!
In and amongst the support for what Fred did were some well argued contrarian views. The quote below is not one of them though it raises an important issue.
The players, owners, league spend money to enter into contracts with cable companies and specialized networks, who in turn negotiate with advertisers to bring viewers an entertainment medium. They have real costs to all of this. But because someone doesn't like that there are fees or limitations or other obstacles within the creating group's model, it's okay to simply "hack" in and take what one likes?
I agree that a lot of planning and investment goes into making a profitable business out of a sports team or even any other entertainment performance like a music album or whatever. Those investors and operators are perfectly entitled to charge what they want and how they want in order to recoup their costs.
For me the big caveat in all the above that turns someone like Fred into a 'pirate' is the fact that during business planning a conscious decision has been made to have this sports package not appeal to him. That is through a combination of pricing, segmentation rights, down to stadium capacity, match day scheduling and location. When all is said and done the rights holders have put together a package which they believe will earn them the most revenue possible in order to recoup costs that they have deemed as appropriate for this enterprise.
In simple terms; when selling their package rightsholders are consciously saying #screwyou to a certain percentage of interested parties. Nothing wrong with that. It's their prerogative and a balance HAS to be found.
What I find interesting is that there seems to be a belief that it's okay to then go after these people who have already been told to screw themselves as if they actually mattered to the business model. They don't really; and any plan should not have taken into account revenue from someone who has been told where to go or revenue lost by that person consuming that service in a way that does not deprive other willing buyers. The fact is no business can sell all their products to everybody all of the time. Someone has to be out of the loop even though digital products make that scenario theoretically possible.
Naturally there are people who infringe copyright and would have been perfectly able to legally consume it. It is wrong of course, but I believe that every business model has to try to have low enough barriers to allow people to take up the product. In a previous post I referred to the concept of a consumption threshold. This is something that is generally not a feature of high quality digital content, though Louis C.K seems to have found a balance between price and protection and he is succeeding despite those who are saying #screwyou to him. It's probably because he only tried to 'screw' relatively few people in the first place!
Related articles
- #screwcable (avc.com)
David Haye is no mug
Image via Wikipedia
I've just read an interesting article by Paul Hayward of the Guardian on David Haye about tonight's fight against Wladimir Klitscko; and predictably a few well spoken people lamented the usual.
- Klitschko looks in far better shape than Haye.
- Haye is too small to be considered a legitimate threat
- Haye has shown nothing at heavyweigtht and is about to be exposed as a decent cruiserweight and little more.
I wrote a comment to reply and thought it comprehensive enough to reblog here.
I don't normally agree with Mr Hayward, but I think several commenters are missing the key points he is making.
Like Lennox Lewis, Hayward is saying that the comparisons between David Haye and Muhammad Ali are not about boxing records, but are based on the fact that both are very brash even though they can articulate their thoughts very well. It's true that since Ali there have been LOTS of brash boxers, however many of them are just not articulate when they need to be. Whether you admit it or not Haye is.
In addition Haye is an athelete in the true sense of the word, he is agile, fast and has stamina. Athletic. (Ironically this is the probable reason for the decline in American heavyweight boxing, West Indies cricket and soon the Australian cricket team) This guy is no Tyson (who is still the most destructive fighter to have entered the ring despite his lack of staying power. People confuse being fit with being an athlete. There is no doubt, that Klitschko is a very very fit boxer, Tyson was too. But there is a huge difference between being fit and being athletic. Both have their pros and cons when it comes to boxing.
Lastly, all those denigrating Haye's size need to ask yourselves one thing. What would he have done if he was still a Cruiserweight? In the grand scheme of things, the answer is nothing. The man on the street would have a hard time naming 3 heavyweights let alone, 3 cruiserweights. There was nothing left for Haye in that division legacy-wise. Let the man try to earn his stripes as a heavy. There is nothing wrong with that.
Whilst I'm talking about the men on the street, I might as well mention that it is them who are likely to pay £15 for a pay-per-view fight. Not the average 45 year old with 3 kids, a wife and 1 friend. Yes, that guy might go to the fight, (lets face it these guys also go to the Grand Prix which is as close as your can get to affording just about any other sporting event,) however, mega-fights all make their money on PPV sells. The man on the street would be very likely at home with his mates, a few beers watching a couple of blokes trading punches in the ring. Coincidentally (if we exclude Apple) all your middle of the road brands happen to be the absolute biggest companies in the world. They make their money by peddling stuff to.....the man on the street. If Haye wins his fights, the money will follow in every way possible.
Tonight Haye will be in his toughest fight to date. I personally think the fight is 50/50, because in this division ANY heavy can knock ANY OTHER spark out with one punch and in addition Wlad is clearly a more than decent boxer. You wouldn't expect Haye to say it's 50/50 though would you? He has to be confident and I am loving it that he is. Otherwise he might have been too scared to fight. However win or lose, Haye is no mug. Take off those blinkers now.
Kudos to Paul Hayward for writing a well-balanced article that takes everything that has been said before, but puts in one coherent piece for those of us prepared to look at things in perspective. Here's to reality.
If FIFA ever had any credibility they would have lost it today
It is a sad indictment of FIFA when the English FA are standing up for ethics, integrity and values whilst the British contingent of journalists are standing up for honesty and decency.
No where more than on these pages is the English media elevated to the post of laughing stock that they so richly deserve. Today, as FIFA re-elected President Sepp Blatter using single name ballot sheets that might as well have been brown envelopes, they can rest easy knowing that there's still plenty of scum out there on which they can shine their tabloid torches.
Well at least we should have a good view of Sepp's coronation.
How to blag a football club and other lessons
I'm a great believer in the theory that football clubs are not a business in the true sense of the word. They are not set up to maximise profits which is sort of the point in all other businesses. Having said that, there are many business models open to them to survive and not just the one endorsed by UEFA, the European governing body.
The most well-known model is of course the benefactor model, in which one person buys a club for his own personal enjoyment using money made from business elsewhere. Benefactors are not just common in football but in pretty much every aspect of life. It's true that most people have much more money than they could spend, and in general it's good clean fun for the rich. Or if you're in Colombia, it's a good way to clean dirty money.
It does end in disaster now and again, but most times you can see the signs well before the proverbial hits the fan. But like a geriatric who has suddenly caught the eye of a hot young thing, it can be hard for us fans to distinguish between a Katherine Hepburn or a Katie Price.
Case in point the story of Craig Whyte a Scottish 'billionaire' who is trying to take over Glasgow Rangers. In fact he has been working so hard at it that it's been 6 months since it was made public that he's trying, and guess what...he's still trying. I'm all for due diligence, but taking over a public company really shouldn't take that long, unless of course this guy doesn't have the money.
When I heard about Mr Whyte's interest in buying Rangers, my initial reaction was...'Who?' Then I heard he was a British billionaire and thought that something wasn't adding up. Britain doesn't have many billionaires and it'd be hard never to have heard of the name of one of them.
My only guess is that he must be one of those people who buys football clubs as an investment or a blagger who wants to buy the club, load it with debt and pay himself a handsome wage. Either way it's not very clever and will probably end up in disaster. A quick Google search can confirm this.
Here are a few extracts...
…….Craig Whyte Founder of Vital UK Ltd . In voluntary liquidation.
…….Director of LM Logistics Group . . . in administrationWas accused of failing to pay his employees' wages and multi-million pound debts owed by a string of companies, all of which he is directly linked to
Has a defunct website for one of the companies he claimed as one of his premier businesses
….Cairnwell Investments Ltd based at Aldermary House lists Craig Thomas Whyte as Director. In October, Cairnwell successfully applied to cancel an official move to have the firm struck off the companies register and dissolved.
…also based at Aldermary House is Merchant Corporate Recovery PLC, which is facing an “Active Proposal to Strike Off”. The firm’s accounts are said to be “overdue”. Its company secretary is Craig Whyte, while Craig Thomas Whyte is listed as a director.
The above is the typical trail left by all unsuccessful scammers. Rangers be warned! You heard it here first.
If your kid looks up to Wayne Rooney, you’re to blame
You've got no respect for things son! You know I had to get the bus into town just to nick that aeroplane!
One week after swearing into a live TV camera during a mid-day match, every man and his dog is having his say on Wayne Rooney. The media has been criticizing Rooney for being angry at all the criticism and abuse he gets. They've since been asking everyone their opinion and criticizing them if they didn't give the 'right' answer. It's now turned into a band-wagon and this blog loves to jump on them; so I think we should ride it.
The biggest thing that everyone has been raving about is as usual, 'think of the children..........he's a role model, and that's no way to behave'. I really don't buy into that stuff because as parents we have much more control over what our children take in and what they'll turn out to be than a celebrity they'll never meet. That is still true even in this crazy world of 24 hour kids TV where every inane idea for a show seems to get picked up. I'm looking at you Sponge Bob!
In no way do I want to excuse what Mr Rooney did, because I think it's in-defensible. Understandable maybe, but still not right. However I really want to discredit the notion that kids will look up to someone regardless of what we as parents want them to.
The main problem I think, comes about because as parents we don't teach kids that in life you have to look to lots of different people for inspiration. Just because a kid loves Wayne Rooney doesn't mean he should be taking lessons in TV etiquette from him. And if your kid doesn't know that, then it's your fault. Neither Rooney nor the government should have to tell your kid that Wayne is all about football. It is of course a slightly different story for Wayne's own kids....., but then I don't know anything about how he's bringing them up.
Personally, I apply the same thing even in friendship. It sounds so obvious but you'd be surprised how many people are disappointed in their friend X who they know has always had a habit of doing a particular thing. I'm only ever disappointed in my friends when they do something I wouldn't expect them too. Yes that's right, I have 'allowances' for all my friends. Just like the banks have different over-draft limits for us all I took that and applied it to my life!
Anyway, there should be plenty of good people in everyone's life and we would all do well to highlight the good things they do to our little ones who are just starting out. A child should have as many role models as he needs. Each one for a specific thing. If one of those role models fails at something he never did well that should never influence the growth of a child.
Whilst we're at it, the media needs to stop feeding the myth of the celebrity role model. It doesn't exist. The only thing we should learn from famous people is how to get famous.
The UEFA and Arsenal love-in is doomed to fail
Sometimes you really wonder how people make into positions of power given their lack of reasoning.
There are many things that our leaders can do without but rationale is not one of them. The folks clowns at UEFA (and FIFA too) have form for coming out with ridiculous statements, but they never seem to amaze in their quest to out-clown Krusty.
The latest one is in relation to the new regulations requiring football clubs to break-even over a rolling three-year period or risk a possible ban from UEFA competitions. It's designed to stop clubs running themselves into debt and financial ruin.
UEFA general secretary Gianni Infantino has now come out and said that clubs need to adopt the Arsenal model because "Ten years ago Arsenal reported less income than Chelsea, Liverpool and Newcastle," Infantino added. "Now it is more than those clubs and in 2009 more than double Newcastle's."
This is pure misguided BS. If Infantino would only take a moment to think of all the big transfer fees that Arsenal generates he'd realise that the clubs that UEFA and Wenger criticize for financial doping are the same clubs who have paid out those huge fees directly to Arsenal therefore increasing their revenues. The question is, where would Arsenal's profits be without the sugar daddy money from Manchester City, AC Milan and Juventus? Or the debt money from Barcelona?
The 'Arsenal model' circa 2020.
p.s. The regulations themselves are also bollocks because sport is not a business in the traditional sense. Never has been never will be. But that's for another rant.
