One of the questions the CRTC has been reviewing lately is the idea of skinny basic. The idea here is to have a smaller basic service, the entry level package at the lowest price for a video package from your cable, satellite or telco video provider. You must buy basic to be allowed to buy anything else. Will skinny basic help the video distributors compete against over-the-top Internet video? Not for long and it’s too late.
With pick-and-pay available on the Internet, more and more market segments will drop out of the traditional cable market. Forcing people to buy channels they don’t want in order to get channels they do want is going to have a tough time competing against the new market model. Forcing people to buy fewer channels they don’t want looks like a stop-gap measure.
Personally, I dropped out of this system years ago. I didn’t watch much anyway, so I didn’t see the value. Also, I must admit, my off-air selection is not bad if I do occasionally want to veg out in front of the TV and channel hop. One of my favourite viewing treats on these occasions is to compare French-language news with the news on the English channels. I admit this is a micro-niche in anglophone Canada, but it is very entertaining on election nights.
Digital over-the-air broadcasting is coming in August as our Canadian channels are endlessly advising us. For the price of a digital antenna, cheapskates like me will be able to continue to get off-air channels with much better signal quality. This will pull the low end of the market away from cable and satellite. The high end will be pulled away because a skinny basic will be expected to have a lower price tag or it won’t have much effect on protecting market share. Whether the price comes down or the customer leaves, it’s all revenue loss.
There will continue to be a market for video packages, but it will be smaller. There are high volume viewers out there willing to pay current prices to have cable companies, broadcasters and specialty channels select their programming for them. Live sports fans also don’t have anywhere else to go, at least not yet.
Internet video viewers are going much further, asking themselves why they need traditional TV broadcast channels and specialty channels to select their programming.
The market for package TV is going to shrink, skinny basic or not.
What are you watching?