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March 17, 2006

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Jule

Interesting post. A couple of comments:

(1) MMOD has been offered since 2004, IIRC, and the past two years it has been available for a modest fee of $10 for the entire package of games. There was no "waiting room". I was surprised to see them move to a free, ad-supported model this year. It is the same package of games for which DirecTV charges about $50.

(2) NFL Sunday Ticket and all of the DirecTV sports packages implement similar blackouts as MMOD (preventing you from watching the game being broadcast on your local affiliate) thereby preserving exclusivity for the local network affiliate.

(3) Those looped commercials you mentioned? They are probably where the local affiliate gets to put in its own ads in the broadcast signal, known as "local avails".

Michael Risch

Warning - long comment!

The interesting thing about the "non-neutrality" in this case is that it is not just about the size of the pipes, but also the server load.

Case in point - AT&T just sent me an email saying that I could get 2 free tickets at Pac Bell (no SBC (no AT&T)) Park. All I had to do was sign in and pick my spot. Simple, right? No such luck - the server was overloaded, and all I got was "Server Too Busy" over and over and over - for HOURS. I am certain that there was sufficient bandwidth for serving these pages - only a few kilobytes of static text.

It sounds like CBS learned from the Victoria's Secret Fashion Show model and decided that the only way to limit server load is to force it. Perhaps they aren't charging this year because they can't charge AND have terrible quality/waiting time at the same time, but if it's free, who can complain?

As to net neutrality generally, I think it is a bit of a misnomer. As bandwidth across the net increases, someone has to pay for it. Phone companies can offer DSL cheap on the assumption that even a 1.5MB DSL line won't be full most of the time, so the intermediate pipe can be smaller. If those 1.5MB DSL lines are full more often (say due to phone or video), then the intermediate pipe must be bigger. Someone has to pay the phone companies for that pipe - either the consumer or the provider. Under no set of facts is there neutrality.

There is probably a strong argument for the provider to pay for it. One would expect that increased costs will get passed on to the consumers anyway, so doesn't it seem fair that those that use the most bandwidth should pay for it rather than those that don't? That's how we used to pay for our old T1 at the office before we got DSL - by percentage of the pipe we used on a monthly basis. I suspect that those who complain about loss of net neutrality are those who fill the pipes more often.

jim

If it is true that you can only watch games not currently available in your local broadcast area, the location determination is made by something other than zip code. This must be so because tonight I watched Kansas play (on a computer and network residing in California) registered with a Kansas zip code.

The most frustrating part of the experience (aside from KU losing) was that the game was "on demand" but not in real time. There was a delay of a few seconds which resulted in the score ticker in the game being televised in my broadcast region to update the KU score quicker than watching the KU game "on demand."

Ed Felten

You note briefly the distinction between broadcast, where cost is independent of the number of viewers, and online streaming, where cost is proportional to the number of viewers.

Using BitTorrent-style swarming distribution, you could get video to an arbitrary number of viewers at a cost that was (a) low and (b) independent of the number of viewers. The software tools for doing this aren't quite ready for prime time, but they'll get there soon -- I'd guess by next March.

This is probably the future of TV.

Bruce

Both your sons have good points, but another issue here, which will likely persist for some time, is that all of this stuff is subject to long-term agreements entered into 10 years ago or more requiring some form of regional exclusivity -- agreements with network affiliates, agreements with local cable sports channels, agreements with the NCAA or individual teams, etc. Although everyone recognizes the technology and the business is changing, it's unclear exactly how and hard to depart from existing models in drafting new agreements.

Jason

I have two quick comments.

1. After my experience with MMOD, most people would be making a poor choice if they paid for VIP access. I made it into MMOD within a minute-and-a-half of being placed into line each time I tried with one exception; it took 40 minutes during the first hour on Thursday. Most of the time I was attempting to jump in for the last minute of close games while at work, which is when you would think demand would be the highest. Why would I pay money simply for quicker access during a brief period of the first-half of the round one games?

The answer is if I am an alum of a 13-16 seeded school who plays in the first set of games on Thursday in a game not being shown in my market. That is a pretty small market segment.

2. Jim, you couldn't view the games in real-time because it takes a few seconds for your computer to buffer the video when you first enter MMOD. Every hiccup where your computer has to re-buffer the video only adds to the delay, but there is nothing (easy) CBS can do to fix these delays.

Michael Risch

Ed - BitTorrent is not user independent - you just have to assume that the number of users is high enough to enable better swarming (I have tried downloads with only two or three people sharing the same file, and it is much slower).

Also, even with swarming the pipes are full for a net neutrality view - in fact, it may cause even more bottleneck to the extent that DSL is asynchronous (smaller upload pipe) and to the extent that data is now all over the place instead of from one sender. That said, if the data is coming from anywhere, it would be a lot harder for phone companies to figure out who to charge.

William Rothwell

I believe the regional blackout is done by identifying the geographic location of your IP address. You can probably get around it by routing the content through a proxy server hosted in a different region.

Cory Hojka

"This plays to satellite’s advantage as its core technology requires all of the signals to be delivered to every locality, independent of actual viewer interest."

Years ago, this statement was partially true. However, in recent years satellite technology has allowed for the use of spot-beam antenna technology in new satellites. As a result, most new satellites are not ones designed to deliver signals on a wide footprint, but instead spot-beam satellites. The reasons for this change is to get away from the major disadvantages of wide footprint antennas.

True, a wide footprint antenna gives you massive coverage, but it wastes energy in undesired markets. Further, it limits your ability to reuse valuable radio frequencies in the total coverage area. Worst of all, there's usually no ability to alter the footprint as the markets change over time.

On the other hand, with spot-beam antennas we can reuse the same frequency in multiple areas covered by the satellite. We also need not waste any resources providing coverage to markets without value (i.e., a desert). Finally, if the markets change (i.e., some fool builds a casino in that formerly undesirable desert, thereby leading to the creation of a fast-growing city), we can alter our coverage without launching another satellite. Instead, we simply reconfigure our coverage pattern with the spot-beam antenna array.

Bruce

Here's a news article on affiliate agreements an Internet downloads:

http://www.siliconvalley.com/mld/siliconvalley/news/editorial/14344642.htm

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