Lose Access?

The Associated Press reports:

Sixty million consumers would lose access to baseball’s television package of out-of-market games if the sport is allowed to strike an exclusive deal with DirecTV, according to Sen. John Kerry.

I am perplexed to how this excludes sixty million customers. Let’s look at the facts…

1.) DirecTV obtains the exclusive rights to “MLB Extra Innings”, which allows viewers to watch out-of-market games. They similarly have exclusive rights to NFL games the the NFL’s “Sunday Ticket”.

2.) DirecTV obtains these rights in an effort to attract customers who value these packages. If a consumer is “exluded” (i.e. doesn’t have DirecTV), he/she can gain access very simply by switching to DirecTV.

3.) The costs of transitioning from cable to satellite are small (if any exist at all). DirecTV routinely gives away its equipment in exchange for an agreement to use their services for 1 year. In addition, many states do not charge taxes on satellite service, whereas they do levy taxes on cable. Local channels, which long impeded the diffusion of satellite services are now available in most markets as well. Thus the tranisition cost is essentially the time cost of making a phone call to DirecTV to obtain their service.

Exclusive deals with certain service providers does not cause the exclusion of customers. If they value “MLB Extra Innings” more than the costs associated with switching to DirecTV then the customer should switch. If not, they should keep their cable service. It is as simple as that.

2 responses to “Lose Access?

  1. But what about people that can’t get Direct TV because of where they live?

    Should MLB have the right to do this? Yes. I think the debate is more in the lines of should they do this. For that the answer is no.

  2. bluemontanaskies

    1. NFL was always exclusive to DirecTV, Extra Innings was available through multiple venues since 2001 until now.

    2. Out of the 230K (Kerry’s 60 million is a “potential” not reality, There was 230K subscribers last year), most cannot switch opposed to don’t want to switch. Condos & apts, in which owners/ renters do not own the building structure (& landlords find ways to restrict), nursing homes & retirement centers etc. are cable-ized, “transients” renting or leasing. In fact it’s those very people who want it so they can follow their home teams. That doesn’t count people who discovered that, when the DTV guy came to their home they couldn’t get a signal. For MLBTV one needs a very good computer and high speed broadband. Not everyone is hi-wired esp. the elderly/ retired… who wants to sit & stare at a small computer screen?

    3. Cable has termination fees that aren’t small. DirecTV also has a lot of tiny print with lots of little things olks should read carefully.

    No one can guarantee when DirecTV becomes a monopoly, the prices won’t rise dramatically esp. if they don’t get the # of switch-over subscribers they expect.

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