At 1:10 PM -0500 on 7/25/1998, Adam Wodon wrote:
> Not replying to anything specific but to the thread in general.
>
> Broadcast.Com - as it now is - despite their $250 million initial public
> offering (how stupid am I?) lost over $6 million dollars last year.
 
Well, chances are you wouldn't have been able to get in on the IPO anyway,
unless you had someone willing to sell you the shares at $18.  Usually only
very large individual investors or brokerages are able to get in on IPOs at
the offering price.
 
BCST officially went public at $18 but when the market opened, they were at
$70.  A lot of individual investors took a bath short-term because they
placed market orders and had to pay that price, and it is near $61 now.
But obviously they hope it will be the next Amazon or Yahoo!.
 
I understand them raising their rates because they do have to become
profitable and they are accountable to shareholders now -- and they also do
have expenses that they may not have been covering before.  But a side
effect will be that probably only those who can make more money off net
broadcasts will be able to air their games this way.
 
> I have had a bunch of discussions with them on this issue, but in my opinion,
> they won't become profitable until they start being a separate entity - a
>third
> medium - providing original content -- not just a regurgitator of other
>content
> (though it is nice to hear Mets games in Iowa).
 
Original content will be a key, I agree.
 
Also, you might like to hear Mets games in Iowa, but most fans are close
enough to listen to the radio or watch on tv.
 
So another key will be taking listeners away from the other media.  For
that to happen, the bandwidth situation has to improve, and it has to be as
easy for a Mets fans in NY to listen to a net broadcast as it is for him to
flip on his tv or radio.  We have a ways to go to achieve either of those.
 
Cable modems aren't the answer because they only improve the bandwidth from
the ISP to your home.  There are still a whole bunch of other variables
affecting the speed of the information you receive.  And while the numbers
are impressive now, the fact that it is a shared medium means that as more
and more people migrate to cable modems, performance will naturally drop.
It's one thing to be the only person on your block with a cable modem,
another when everyone has one.
 
The answer might be Internet2, or something else we don't even know about yet.
 
> Maybe I'm wrong, but to me what makes something like Broadcast.Com
>exciting is
> the possibility of becoming the ESPN of the Internet -- NOT being a simple
> utility used just to extend the range of a home-town radio station.
...
> Broadcast.Com believes out-of-towners want to hear the "homer" feed, but in a
> mass appeal game, like the NCAA Tournament, does anyone out there agree
>that a
> high-quality neutral feed (a la NBC or CBS) should be the goal?
 
Agreed on both points.
 
> In addition, the other thing that I believe will make Broadcast.Com take the
> next leap is the ability to easily charge money for the service.
>
> Now don't go crazy.  I am talking about miniscule amounts like 15 cents per
> listen.  It is completely impractical right now to ask people to put in a
>credit
> card number for a measly 15 cents.  It will drive away more people than it's
> worth.
 
We're not that far off from having this be doable.  E-cash is here today.
 
But the big problem right now is that the connection is not reliable.  You
don't want to pay your 15 cents and then get disconnected and have to pay
again to reconnect.
 
> Would you pay 15 cents to listen to a college hockey talk-show online
>each week
> that you can't get anywhere else (such as, gee, like "Around the Rinks"
>:-)), or
> the NCAA Tournament, or ECAC Tournament, or game-of-the-week.
>
> I know I've harped on this before -- but if anyone out there agrees,
>please let
> me know. I would love to be able to go to Broadcast.Com with proof that the
> average college hockey fan out there agrees with me. Anyone?
 
I'm for it, but there is a psychological factor involved.  People like to
get things for free and much of the content on the net already is free.  It
would take time to change people's attitudes so that they would not see
paying for a service like this as a problem.  It also does have to be
reliable and give you something you couldn't get elsewhere.
 
It might be similar to the problem cable tv faced early on.  Why should you
pay for cable when you could get over the air tv for nothing?  Today it is
a no brainer -- you get a higher quality signal, many more stations and
choices, etc.  But early on, cable mainly just carried stations that were
already over the air anyway.  Among other things, what made it take off was
the proliferation of quality programming and stations (subjective, I know
:-)) that was not available anywhere else.
 
I expect that competition in this area will grow.  Just as you have
different companies providing cable or satellite tv, you will soon have
entities other than BCST trying to do what they are doing.  I know there
are others already, but BCST does have a significant headstart, so they
pretty much run the show now.  This is only the beginning...still it will
take time.
 
Perhaps someday we will have something like cable tv for net broadcasts.
Rather than paying per listen, you would pay a flat rate every month and
get to listen to whatever you want.
 
---                                                                   ---
Mike Machnik                [log in to unmask]               *HMM* 11/13/93
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