Matthew Ball @ballmatthew Venture investor, strategist, essayist, that guy on Twitter. Prev. Head of Strategy @AmazonStudios, ex-Otter Media, @MediaREDEF. 🇨🇦 Feb. 26, 2019 1 min read

Lots of talk that virtual MVPDs won't save Pay-TV. This shouldn't surprise - vMVPDs need to prove they address four problems. They're still 0 for 4.

Thus any price increases devastate growth (but are critical as most services are gross margin negative). 

What are those problems: (1) That they solve a consumer want/need - pricing and access isn't why viewership is imploding; (2) They're better than substitutes like Netflix - which are killing viewing; (3) They discourage suppliers from going D2C; (4) The economics are sustainable

vMVPDs will survive and replace traditional MVPDs. They are cheaper (no installation, repair trucks, hardware), more accessible and easier to use.

But their prices will continue to grow.

So they end up being marginally cheaper versions of the old thing.

Audiences aren't leaving MVPDs because they are a *little* too pricey, or a *little* too hard to use or a *little* hard to use on other devices

That's okay! 50MM+ homes will have Pay-TV in a decade. That's still $100B a year. But it's still the old thing.

And here's YouTube TV with a 25% price hike after DirecTV Now cranked up its prices and reduced what you got for it. 

You can follow @ballmatthew.


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