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Monday, September 03, 2012

CEO Of MLB Advanced Media Is Worried About The Napster Effect

I look forward to file sharing R Budd Selig’s version of “I Disappear”.

Bob Bowman sat down with Mike Ozanian from Forbes and YES Network’s Forbes SportsMoney to discuss major league baseball’s streaming product and the depths of its awesomeness. If you feel like ending it all, feel free to watch that video up there.

If you don’t feel like blowing your brains out, allow me to summarize. This is a five minute-ish video where major league baseball shows off its mystifying talent to be remarkably popularity despite itself. According to the video, various big time media outlets—even Glenn Beck!—use MLB’s streaming technology. It makes sense that baseball would have the best option and that others would crave it. Baseball has the most games to show across the country so it sort of had to develop something useful.

The best part, though, is Bowman warning that baseball cannot be blind to history. He references what happened to the music industry. The presumption is he means Napster. You remember Napster, that awesome time when people stopped buying shitty albums because they could get the songs they wanted without all the garbage filler, and they could get it for free. Video online is where it’s at these days though, Bowman notes, so baseball needs to make sure it stays ahead of the curve so it doesn’t piss off paying customers so much that they try to find a less restrictive avenue to enjoy the product.

Repoz Posted: September 03, 2012 at 10:37 PM | 36 comment(s) Login to Bookmark
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   1. Walt Davis Posted: September 03, 2012 at 11:48 PM (#4225889)
Not going to watch the vid but the excerpt confuses me.

If Bowman is warning that what happened to music (that many, many people now treat it as a commodity they expect to be free) could happen to baseball -- seems unlikely but all they need to do is follow the very successful model they've already got which is delivering a ridiculous level of value for money. $20-25 a year for "every" game, including iphone/android support? It's a ridiculous bargain. If the record companies had responded to napster with "for $5 a month, you can stream any album you want" there never would have been an issue. (OK, they'd have had to coordinate and have 1 to maybe 3 sub services.)

So, as Bowman notes, don't piss off their mostly very satisfied customers. The only thing I see that could lead to pissed-off customers is the generally idiotic blackout restrictions. I'm not sure the best way around that -- i.e. the local broadcasters will want compensation for lost eyeballs -- but is it any more complicated than "pay an extra $20 and get the blackout lifted"? Not allowing past highlights on youtube seems kinda silly to me -- is there really much sales value in past highlights? Aren't you better off using them as promo tools? At most maybe black out the current year's highlights?

OK, I have a complaint -- the streaming requires more bandwidth than New Zealand's circa 1995 internet could handle so I did drop mlbtv for just mlb radio since I could never watch the games anyway. I think that's like $10 per year. Also, for some strange reason, it never worked for me on opening day and then there'd be the two days of me going back and forth with their customer service with me explaining over and over that I lived in New Zealand and so had no blackout restrictions (it's awesome!).

I'll grant you I'm a bit flummoxed how MLB can sell mlbtv so cheaply. I suppose the fact that the production costs are elsewhere helps but then I assume the broadcast producers are getting compensated for that somehow. The NY Times is still expecting $200-500 per year depending on how many digital devices I want access from -- still not a bad deal but it's blown out of the water by mlbtv's value. It was many years ago now but I recall the Extra Innings package was a darn good value too.

Anyway, as long as the thing is so freaking cheap, who's going to complain?
   2. Harold can be a fun sponge Posted: September 03, 2012 at 11:51 PM (#4225891)
Video online is where it’s at these days though, Bowman notes, so baseball needs to make sure it stays ahead of the curve so it doesn’t piss off paying customers so much that they try to find a less restrictive avenue to enjoy the product.


The bolded part is great to see. Clicking through to Forbes' summary, it seems to say that in reference to local blackouts; that MLB must find a way to deliver live local games via streaming, or somebody else will find their own way to do it.
   3. Cooper Nielson Posted: September 04, 2012 at 12:07 AM (#4225896)
$20-25 a year for "every" game, including iphone/android support? It's a ridiculous bargain.

I'll grant you I'm a bit flummoxed how MLB can sell mlbtv so cheaply.


Walt, I believe the $25 a year that they're advertising now is just an end-of-season offer, which started about a week ago. The preseason price for the "every" game package was around $125 (I think this covers 6 months + postseason).

I subscribed this year so I could watch Tiger games in Vietnam. $125 is a bit of a commitment, but it's still a good price if you are able to watch a lot of games (no blackouts here, but most of the games happen when I'm asleep or getting ready for work). The product and the app(s) are quite good.
   4. Walt Davis Posted: September 04, 2012 at 12:12 AM (#4225898)
MLB must find a way to deliver live local games via streaming, or somebody else will find their own way to do it.

For sure but the "obvious" way to do this (if not through MLBAM) is to let WGN do it ... or let the Cubs contract their local streaming rights. I guarantee that if somebody starts streaming Cub games without the Cubs/MLB getting a cut, they will think they've died and wound up in the part of hell reserved for lawyers because they're going to have a million of them on their ass in about 5 seconds. I don't really see a Napster-like possibility here -- nobody's going to produce their own live video of the game so streaming the Cubs requires hijacking the feed from WGN (and the other outlets). Napster had its effect because one guy in his dorm room could put 10 cds online every night and you had potentially millions of guys sitting in dorm rooms.

Realistically, the only people capable of streaming Cub games are MLB and WGN or whoever the Cubs sell the video rights to. Heck, even in music, I don't recall seeing a huge number of "pirate" streaming sites -- the main issue was around legit radio stations streaming on the internet while paying only their standard over-air royalties. Heck, are there even many people trying to find ways around MLB's blackout? Is there some server in China you can log into? If nobody's trying to steal it now, I don't think it's all that likely they will in the future.

Anyway, it's a ridiculously easy problem to solve, especially if MLB doesn't try to centralize the revenue from "local streaming." But of course they do want to centralize that revenue.
   5. Walt Davis Posted: September 04, 2012 at 12:14 AM (#4225903)
Walt, I believe the $25 a year

Yeah, that $25 seemed a lot cheaper than I remembered it but they didn't have it labelled as "from now until the end of the season" which was the way they always advertised it in the past. It just said "for 2012..." which is what threw me. $125 is starting to bite a bit but is still plenty cheap.
   6. Joe Kehoskie Posted: September 04, 2012 at 12:14 AM (#4225904)
So, as Bowman notes, don't piss off their mostly very satisfied customers. The only thing I see that could lead to pissed-off customers is the generally idiotic blackout restrictions. I'm not sure the best way around that -- i.e. the local broadcasters will want compensation for lost eyeballs -- but is it any more complicated than "pay an extra $20 and get the blackout lifted"?

If it was that easy, it would have happened years ago. The key issue seems to be that live sports is seen as the main thing keeping people from "cutting the cord" and ditching their $80 to $150/mo. cable TV packages. I bet the price of MLB.tv would have to double or triple before the cable companies would agree to lift the blackout restrictions, and that might be a low estimate.
   7. Dale Sams Posted: September 04, 2012 at 12:31 AM (#4225918)
On a related note...how hard is it to burn baseball game dvds on request? You order and pay online, and your requested game arrives in 5 days, WHAM!

I know Warner Brothers does that with movies, but they have yet to produce Looney Tunes on request for those who want to own the catalogue, but are tired of WBs scatter-shot efforts.
   8. boteman Posted: September 04, 2012 at 12:48 AM (#4225926)
that MLB must find a way to deliver live local games via streaming, or somebody else will find their own way to do it.

Like Slingbox? I was going to install one at my Dad's house in the D.C. suburbs when I realized that between my ultra-crappy AT&T DSL and the cost of the Slingbox to watch only MASN I could just pay DirecTV to see all games via their Extra Innings package and get it over with. The only added benefit of watching MASN via Slingbox is that I could get the fluff filler and talk shows, but those mostly bore me anyway, so no loss there.

I wouldn't put it past a group of enterprising baseball fans to set up a network of Slingboxes at their own expense simply to get around blackout rules. Once I switch to Comcast Internet and ditch this pathetic excuse for DSL I'll look into MLB TV as an alternative to DTV Extra Innings. MLB is sitting on a cash cow as long as they don't f@ck it up.

And the MLB Gameday audio streams both home and away play-by-play broadcasts which is an extremely good value at the $20 or $25 per season they charge. I have that thing cranked for every Nats game, and then whatever else catches my fancy when I'm at work late or home working at my computer and can't sit in front of the boob tube.
   9. Sleepy supports unauthorized rambling Posted: September 04, 2012 at 02:11 AM (#4225946)
I bet the price of MLB.tv would have to double or triple before the cable companies would agree to lift the blackout restrictions, and that might be a low estimate.


But that doesn't make sense- you can only watch out-of-market games on mlb tv, anyway. Blackouts only affect local games, and saturdays. I use mlb tv to get around the fact that fox doesn't offer a FSN MW package to people living in CA. If I was a fan of a CA team, I wouldn't need MLB TV.

The biggest issue is, the blackouts often mean I have no way of seeing my team play, regardless of how much I've paid, or am willing to pay, and that is a huge fail on the part of mlb AM.
   10. Joe Kehoskie Posted: September 04, 2012 at 02:23 AM (#4225949)
But that doesn't make sense ...

Which part doesn't make sense? The blackouts are the only thing keeping people in local markets from ditching their $80 to $150 per month cable TV packages in favor of the $125 per year MLB.tv subscription.
   11. Bring Me the Head of Alfredo Griffin (Vlad) Posted: September 04, 2012 at 02:24 AM (#4225950)
The only thing I see that could lead to pissed-off customers is the generally idiotic blackout restrictions.


I also wish they weren't quite so zealous about filing DMCA notices on MLB videos that aren't available on their own site. If it happened in the last couple of years, fine, I'll watch it on MLB.com (even if it means I have to sit through my nine-thousandth viewing of that Joe Mauer commercial for Head and Shoulders), but once the YouTube video of Jason Kendall diving over the catcher in 1997 got DMCA'ed, it was down the memory hole for good. Which is a pity. It was a hell of a play, and when Kendall retired, I would've liked to have been able to link to it.
   12. Sleepy supports unauthorized rambling Posted: September 04, 2012 at 02:51 AM (#4225955)
Which part doesn't make sense? The blackouts are the only thing keeping people in local markets from ditching their $80 to $150 per month cable TV packages in favor of the $125 per year MLB.tv subscription.


Gotcha. Sorry. I think you're overstating the case a bit, but we're talking different "blackouts" (I'm thinking specifically of the ones that have historically forced me to watch NY/Boston, while living in LA, and while STL was playing the Cubs, with LAA and LAD both playing later that night). My bad.

Vlad, I think the doofus interviewed here explains exactly why we don't have that video available to us. He's "not on the clock", "he's got time to figure it out", and he doesn't really care about the fans (in fac, instead of trying to provide us with the best bang for the buck, or the best experience possible, he's spending his time worrying that we're taking advantage of them). This guy sounds like an absolute nightmare boss, but at least now I know why I can't buy a copy of the 2004 NLCS on DVD, at any price.
   13.  Hey Gurl Posted: September 04, 2012 at 03:22 AM (#4225957)
Walt, I believe the $25 a year that they're advertising now is just an end-of-season offer, which started about a week ago. The preseason price for the "every" game package was around $125 (I think this covers 6 months + postseason).


It does not cover the postseason; an annual source of frustration.
   14. Greg K Posted: September 04, 2012 at 03:24 AM (#4225958)
I lived in New Zealand and so had no blackout restrictions (it's awesome!).

That's the one good thing about living in the UK!

Though I remember once when I was living in Toronto they had trouble reading where I was (I know literally nothing about computers and the internet so excuse my vagueness)...something about IP addresses. So it just played it safe and blacked out every game. That took a phone call or two to sort out. In all though I have to say, very satisfie with mlb.tv. Last spring I was going to get an NHL online package for the playoffs...but they didn't appear to have a discounted rate for the end of the season the way MLB does. Very disappointing.
   15. Greg K Posted: September 04, 2012 at 03:25 AM (#4225959)
It does not cover the postseason; an annual source of frustration.

Really? I always thought it did. Or does it technically cover the post-season but its blacked out?

I ask because a friend of mine with an awesome TV got the end of year package. I was hoping to watch some of the playoffs there rather than on my laptop.
   16.  Hey Gurl Posted: September 04, 2012 at 03:28 AM (#4225961)
If I recall correctly from last year, they'll give you something called Postseason.Tv which allows you to watch the game from a fixed camera in left field, but no networks and I think no phone integration.

But someone with a better memory than I should chime in,
   17. Greg K Posted: September 04, 2012 at 03:49 AM (#4225963)
Oh well, worst case scenario I can bring my laptop to his place and hook it up to his tv with my account.

I do recall that when the playoffs start every time I turn on a game my mlb.tv account asks me which service I want "MLB.TV" or "Post-Season.TV". The full MLB.TV service only being available to non-US or Canada accounts.
   18.  Hey Gurl Posted: September 04, 2012 at 04:46 AM (#4225965)
Oh yeah. Right. I forgot you folks are different. We get blackouts which is awesome.
   19. BFFB Posted: September 04, 2012 at 05:01 AM (#4225966)
It's not that difficult to bypass mlb.tv's blackout restrictions, just use a VPN or other proxy.
   20. Flynn Posted: September 04, 2012 at 06:58 AM (#4225975)
You get the postseason on MLB.TV in the UK. I watched some of the 2010 World Series on it when I couldn't take Buck and McCarver anymore.

I also wish they weren't quite so zealous about filing DMCA notices on MLB videos that aren't available on their own site. If it happened in the last couple of years, fine, I'll watch it on MLB.com (even if it means I have to sit through my nine-thousandth viewing of that Joe Mauer commercial for Head and Shoulders), but once the YouTube video of Jason Kendall diving over the catcher in 1997 got DMCA'ed, it was down the memory hole for good. Which is a pity. It was a hell of a play, and when Kendall retired, I would've liked to have been able to link to it.


I feel like this is a minor issue because only the YouTube generation cares, and MLB.TV is so good at everything else that it cancels it out. But it is annoying. All of the other major sports are quite open viewing YouTube highlights/old ballgames/etc. as being great promotional material.
   21. Greg K Posted: September 04, 2012 at 07:03 AM (#4225977)
I feel like this is a minor issue because only the YouTube generation cares, and MLB.TV is so good at everything else that it cancels it out. But it is annoying. All of the other major sports are quite open viewing YouTube highlights/old ballgames/etc. as being great promotional material.

Agreed, a couple Brit friends of mine who are getting into baseball had a lot of trouble with this. We'd be hanging out and decide to watch some great baseball plays and it was such a headache finding them. I find searching highlights on the mlb.com website a bit cumbersome. It is a minor thing really, on the whole I think baseball's done a great job with their online stuff...but it can be annoying.
   22. Fancy Pants Handles lap changes with class Posted: September 04, 2012 at 07:43 AM (#4225986)
Realistically, the only people capable of streaming Cub games are MLB and WGN or whoever the Cubs sell the video rights to.

And, you know, every single person they are streaming the content to.

You can get illegal streams of basically every game in every major sport. And have been able to for years. The quality is still not on par with what MLB.tv offers, but it's constantly getting better. And with the ever decreasing cost of bandwidth, p2p streams are just going to keep getting better.
   23. Walt Davis Posted: September 04, 2012 at 08:07 AM (#4225993)
I dunno, I'm already streaming my "cable" so I'm not sure what's being protected. And my "cable" provider is my ISP so that's how I'm streaming MLBTV/radio too. They're also my mobile phone provider. If anything I assume we'll be seeing these companies offering us massive packages of mobile/intenet/streaming/netflix/mlbtv/apps/games/whatever with virtually everything "on demand". There's little distinction left at this point among the media. But I guess that is how this could become like napster -- if the companies keep trying to force people to use old technology rather than figuring out how to rip them off on the new technology, they'll be in trouble.

A WGN stream can still show its commercials if it wants (I'm also flummoxed why the commercial content on mlbtv isn't more voluminous and more varied; same with streamed TV content from the TV stations showing the on-air). Live sports is good because it's the thing folks won't zap through the commercials.

I don't know what WGN gets from the cable companies for being carried ... but I'm pretty sure they could make a nice, tidy profit on a streaming pakcage of all their sports.

Anyway, ain't no way baseball gets broadcast "for free" because the production costs are too high. If we get to the point where 5 guys with cellphones can give you a live MLB quality broadcast then we might have something.

But I don't think this has to do with cable because that's not the genesis of the online blackout rule (I don't think). I really think this is mainly about local vs. centralized revenues. Quite clearly the Cubs don't want local streaming rights to go to MLBTV and that's how things were agreed at the start. But at that time, nobody knew if that stuff was gonna be popular and the Cubs didn't have the capability to go online themselves (or at least you didn't want 30 teams running 30 systems). And that's still fine but it's silly not to allow the Cubs to use MLBTV's system to sell a package to stream the Cubs.
   24. Bring Me the Head of Alfredo Griffin (Vlad) Posted: September 04, 2012 at 08:20 AM (#4225995)
It's not that difficult to bypass mlb.tv's blackout restrictions, just use a VPN or other proxy.


A paying customer shouldn't be forced to subscribe to a separate service that lies about their physical location in order to make use of the service they're paying for. That's just dumb.
   25. Fancy Pants Handles lap changes with class Posted: September 04, 2012 at 08:52 AM (#4226011)
A paying customer shouldn't be forced to subscribe to a separate service that lies about their physical location in order to make use of the service they're paying for. That's just dumb.

Proxies are for noobs anyway. Way too restrictive on bandwidth. Just tell Firefox to give out a fake IP. Problem solved.
   26. Dan Lee is some pumkins Posted: September 04, 2012 at 09:21 AM (#4226024)
On a related note...how hard is it to burn baseball game dvds on request? You order and pay online, and your requested game arrives in 5 days, WHAM!
The Australian Football League does this very thing. Not sure how much money they make on it, but it's more than zero, which is what MLBAM makes on its old broadcasts.
   27. BFFB Posted: September 04, 2012 at 10:22 AM (#4226063)
Proxies are for noobs anyway. Way too restrictive on bandwidth. Just tell Firefox to give out a fake IP. Problem solved.


Didn't think that worked for MLB.TV because it's through a client? The fake IP method works too, although I've ditched firefox for comodo dragon (chrome without all the google spyware).
   28. zack Posted: September 04, 2012 at 10:24 AM (#4226065)
Walt, what Fancy Pants is saying is this: say I get the top-tier DirectTV package that gives you every regional sports network, just not your own. You have no TV service at all. I pipe my TV into my computer and re-broadcast (with implied oral consent, of course) channel 9102, showing the Cubs game, to anyone who connects to my website. So long as someone is broadcasting the content, anyone can redistribute it. That's what the rights owners are worried about, not some guy filming the game from one of those apartments overlooking Wrigley and giving his own play-by-play.

It's kind of moot worrying about though, because no matter what the rights owners do, as long as someone can see it they can redistribute it because of the analog loophole.
   29. I am Ted F'ing Williams Posted: September 04, 2012 at 12:51 PM (#4226194)
The local blackout thing is to protect cable systems who shove unwanted channels onto their customers. If I could stream without blackout on MLB.TV, I'd dump cable TV. How many people are stuck with local sports channels (and get charged for them) but don't want them? Likewise, how many people get stuck with the Oprah Winfrey Network (and get charged for it) because it's in the same service tier as the local sports channel?

   30. I am Ted F'ing Williams Posted: September 04, 2012 at 01:11 PM (#4226223)
Also, since the teams usually own a piece of the local sports channel, they get a nice chunk of change from customers who are tiered into getting the channel even if they don't want it.

No doubt the biggest channel charges in a cable bill (not counting the "premium" channels) are the local and national sports networks. It will take non-sports fans getting fed up and switching to the internet for the content they want, leaving the sports channels as the only ones left on cable. That will put revenues more in line with the people who actually want the products, ending the current socialized nature of the revenues.
   31. DJS and the Infinite Sadness Posted: September 04, 2012 at 03:30 PM (#4226393)
Pirate streams are actually quite good, very useful for getting around baseball blackouts. Football pirate streams are also quite good, though you'll end up occasionally getting something weird, like the SkySports coverage which has the regular TV broadcast but the studio being Cecil Martin and a British dude that doesn't know all the US football terms. Not that I would ever use a pirate stream myself, I just hear things.
   32. Fancy Pants Handles lap changes with class Posted: September 04, 2012 at 03:56 PM (#4226435)
Not that I would ever use a pirate stream myself, I just hear things.

Of course not. That would be seriously unlibertarian of you.
   33. Chris Needham Posted: September 04, 2012 at 04:43 PM (#4226494)
This is a few years old, but here's a link to the per-subscriber cost that various networks charge. I think ESPN is up over $7 now.

I know here in DC, MASN charges something like $1 or $1.50 per subscriber. I imagine that most RSNs are in line, if not higher.
   34. Walt Davis Posted: September 04, 2012 at 09:23 PM (#4226689)
The local blackout thing is to protect cable systems who shove unwanted channels onto their customers. If I could stream without blackout on MLB.TV, I'd dump cable TV.

Right, but you'd be paying the Cubs (via WGN or Cubs.com or whoever) to stream the Cub games. Or you wouldn't. MLB's regular season revenues are not based on cable subscriptions, they're based on what WGN and RSNs are willing to pay to have exclusive rights to 'broadcast' the games. MLB isn't making money (or not very much) off the fact that the Oprah Winfrey network is bundled in.

Now, if MASN is making $1.50 per subscriber for (making a number up) 5 million suscribers ... well (a) that's not really a lot of money in the big scheme of things and (b) how many subscribers would they have to MASN online and what could they charge for it? Clearly the vast majority of their revenue comes from ads, not cable subscribers, so the key is streaming the ads.

Now I know it's quite common for the major cable provider of an area to be one of the owners of the RSN but MLB does not have an incentive to ensure that people are paying $80+ per month for cable they don't want.

I understand folks can stream what gets streamed to them. But that's still nothing like Napster because only a relative handful of people have the desire and server capacity to be re-streaming stuff to millions of people ... and it's not clear they'd be doing it at a substantially lower price than MLB would anyway. To the extent that people use these services at all it's because they aren't allowed to stream the local content online ... so the obvious and easy solution to this is to have teams sell their "local" streaming rights. What's holding that up is MLB's centralization of online revenue.

That is next year MLBTV could easily offer $125 per year for out-of-market games or $155 per year for all games ... with that extra $30 going to teams based on subscribers from their market, meaning a lot more money to Yanks, Cubs, etc. and very little extra to the Royals. And of course MLBTV would have to start streaming all the local ads (at least to the local subscribers).

And that's not my point about production. The point there is that what also happened in music is that digital technology and music softward made it very cheap to record and allowed even the teeniest indie band the ability to produce a decent recording. The distinction between "big time" music and not is mainly marketing costs, not the quality of the music or the quality of production. Proper production of live baseball will always cost millions of dollars and MLB baseball is of obviously higher quality so if nobody can make millions of dollars off of it, that production will stop.
   35. Poster Nutbag Posted: September 04, 2012 at 10:49 PM (#4226750)

Which part doesn't make sense? The blackouts are the only thing keeping people in local markets from ditching their $80 to $150 per month cable TV packages in favor of the $125 per year MLB.tv subscription.


Heh, this.

A million times this.

With a VPN, "blackout" is not an issue. An Xbox, a few Roku devices, MLB.TV Netflix/Hulu/Amazon Prime, Plex Media Server and a VAST collection of media....I honestly do not understand how cable/satellite companies stay in business these days (aside from creating the illusion that they are the only way to recieve certain content). I cut the cord and am actually more pleased with my (significantly cheaper) options now. I am not the preachy type, but I sincerely suggest that everyone (literally....everyone) do the same...it's the new market inefficiency!
   36. Joe Kehoskie Posted: September 05, 2012 at 12:17 AM (#4226795)
That is next year MLBTV could easily offer $125 per year for out-of-market games or $155 per year for all games ... with that extra $30 going to teams based on subscribers from their market, meaning a lot more money to Yanks, Cubs, etc. and very little extra to the Royals. And of course MLBTV would have to start streaming all the local ads (at least to the local subscribers).

It might be simple technologically, but it's not simple contractually. MLB can't unilaterally end the blackouts, and some MLB teams have 20-year TV contracts in effect.

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