Please let me give you money

Last week someone
tweeted about how good the BBC iPlayer is and I got very angry.

The iPlayer is
(despite the Apple-esque name) the BBC’s foray into providing its content in a
user-friendly, online manner.

The Beeb has its own
version of TVNZ’s defunct charter (well, more properly TVNZ had a version of
the BBC one) which they have chosen to interpret as requiring the BBC to make
its content available to Britons in any manner they can. No limits on this
service – that’s the benefit of having a TV tax that funds one free-to-air
provider I suppose.

Although I’ve got a
red passport still, I can’t see the iPlayer because I live outside the UK. Yes,
there’s a global version of the iOS app, but I can’t get it because it’s not
available in the New Zealand app store.

It looks lovely. Not
only can you search and watch TV shows but you can queue them up so you have a
set “channel” if you like. Some real thought has been put in to making it user
friendly and worthwhile.

Here’s the thing – I
would pay for access to the content. I would. I would help swell the BBC’s
coffers by giving them money which they, in turn, could use to make more
television programmes which I would then pay for.

Unfortunately they
don’t want my money.

Netflix is in a
similar position. It too cannot approach me directly, cannot sell me content
legally because of the asinine TV rights model which sees programmes sold to
regional players who on sell to local networks who onsell…

I’m reminded of the PC
channel wars of the late 1990s when Dell entered the market. Forget Dell’s
current market position (PCs are dead, didn’t you know?) – when it arrived on
the scene Dell swept the old world order aside.

A former head of HP
New Zealand once explained it to me like this. HP doesn’t sell PCs to
customers, it sells them to a regional distributor. The distributor doesn’t
sell PCs to customers, it sells them to a local distributor. That distributor
doesn’t sell PCs to customers, it sells them to a local retailer (a VAR or
“value-add reseller”). That VAR doesn’t sell them to customers, it sells them
to a retail partner (a “shop”) which finally sells the PC to the customer.

Every link in the
chain “adds value” by which of course we mean cost.

Compare that with
Dell’s model which was to simply sell computers to customers. Dell wouldn’t
even build the computer until someone wanted it, which meant it never had that
panicky moment when one model doesn’t sell particularly well and you’re stuck
with a warehouse full of them.

This is the TV market
as we have it today, except for one important difference. I can get my TV for
free within minutes of it airing in the US or UK or Guatemala because I can
pirate it. I don’t have to wait until the channel finally gets round to delivering
it to me – I can get it myself.

This poses a huge
problem for the people who make and sell television content in a way that never
occurred in the PC market. It was never easy to parallel import a PC but it’s
child’s play to parallel import a TV show.

Several people told me
to pull my head in and just use either a VPN service or some kind of DNS work
around to get to the content I want, but I refuse to do this. In effect I would
be lying to a company (committing fraud in my view) in order to give them money
and thus support a business model that is failing. I’d rather they acknowledge
the world has moved on and simply let me pay them directly for the content.
That’s obviously where all this is going so why not just get out of the way and
let me give them money?

A year ago, Netflix
accounted for one third of all US internet traffic. Today it’s closer to half.
Netflix is paying content makers to provide TV shows which it will air directly
to customers.

Netflix is bigger than
piracy and if the TV content makers don’t hurry up and figure out that we want
to watch television and are willing to pay for it, then the problem they face
is one of extinction, pure and simple.

Quite where that
leaves television in New Zealand is a vitally important issue. Television is married
to local culture in a way that no other medium can quite claim and if we’re to
continue to have a local TV service we have to figure out a way to fund it.
Personally I’d rather pay for that than pay for a dodgy VPN provider just so I
can watch television.

4 replies
  1. bob johnson
    bob johnson says:

    some good points but a bit of clarification on the difference between Netflix and BBC.
    Almost all the content on BBC iplayer is created and owned by the BBC. this means that they could, if they wanted to, choose to sell the iPlayer in NZ. they choose not to because they get more money from Sky for UK Tv than they would selling the iplayer access (at least, they think they do).
    with Netflix it is different. Netflix own almost none fo the content they show. It is owned by global studios who make much more money by selling regional deals than they would by letting netflix takeover the world.

    thekey difference therefore is that Netflix is not allowed to approach you directly because of the content owner overlords. BBC absolutely is allowed to, but they choose not to for monetary reasons. the effect is the same, but the source of denial is different.

    • Paul Brislen
      Paul Brislen says:

      Absolutely right, Bob. The Beeb could offer it up and eventually I suspect they will, but it’s the aggregators that will struggle to find a purpose post the move to direct selling.

      The future aggregators could well be Netflix etc but equally could be Sky or TVNZ. They could still make a run for it, even now.

  2. John Adair
    John Adair says:

    totally agree Paul, ease of access & ease of use are 2 key requirements to promote user uptake & a great user experience. Users are more than willing to pay for value. Time and again, it is the "illegal providers" that are most creative at finding a new (disruptive) business model. Problem we have in NZ is that we have few real dealmakers and too many "influencers" who can inhibit innovation / speed to market – look at our 2 big telcos & Sky as great examples. Here we have a group of legislators / government depts more interested in creating ways to criminalise individuals for refusing to conform to the "canned view" the powerful few want to impose on us. This is completely at odds with the typical Kiwi attitude of wanting to "punch above our weight" and be innovative on the world stage.

  3. Jack Prichard
    Jack Prichard says:

    Wow Paul you got through that whole very insightful article which I completely agree with and didn’t mention ‘them’ by name. I guess if we don’t say the name them they can’t see us?

    Basically, it comes down to this. The New Zealand market is so small the big content creators or suppliers don’t care, we have the Skynet legislation but … yeah. There is one big TV content supply company in and anything which could threaten it is ‘dealt with’, notice how Quick Flix hasn’t added anything in a while and even Yes, Minister is now gone? That’s what ‘dealt with’ means. This is because NZ being such a small market any threat to ‘them’ is a real threat, there can be no competition because almost anything would represent a better deal. Same reason the On Demand services only have shows for two weeks.

    Turns out this isn’t so bad for most TV watchers. Most of us want to watch stuff from overseas and pirating isn’t so hard after all. Discs are expensive, to rent or buy, Netflix et all require work around, Quickflix well we covered that, ‘Them’ are an expensive bundle when we want ‘pay as we watch’. So, pirating is the obvious option.

    The looser will be locally produced TV. But judging by how badly Auckland Daze was promoted nobody really cares about that.

    Oh well, bring on the next Game of Thrones.

    J

Comments are closed.