Re: [Swprograms] OT: Sirius discloses plans to offer a-la-carte discounts post-merger

["Richard Cuff" <rdcuff@xxxxxxxxx>]

It will depend how their content partners are paid -- by number of
total subscribers?  Percentage of total revenue?  It is possible that
the prospect of a-la-carte pricing might have been baked into the
original contracts with such folks.

Perhaps it's like General Electric Leasing and the airline industry --
when airlines went through their rounds of bankruptcy, abrogating
their lease agreements, the leaseholders pretty much accepted the
less-favorable terms, under the logic that GE couldn't find other
takers for aircraft anyway, and that some revenue for the asset was
better than no revenue -- and this is for an asset that could sit in
the desert and age relatively slowly.  By comparison, sports and
entertainment contracts are like hotel rooms:  the rights to broadcast
today's NHL games have zero value tomorrow, the same way that a hotel
room for tonight is worth nothing tomorrow.

It will be interesting to watch the parallel battle between MLB and
the cable and satellite providers.  I know several people who
subscribe to the cable-delivered "Extra Innings" package who are
fuming that they might have to switch delivery platforms (egad, what a
phrase) to DirecTV in order to get their out-of-town fill of baseball.

Richard Cuff / Allentown, PA

On 3/21/07, jfiglio1@xxxxxxxxxxxx <jfiglio1@xxxxxxxxxxxx> wrote:
> I wonder how happy their content partners will be with this approach
> and to what extent their contracts will permit it.
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