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BT Vision - Why Has The Price Collapsed?
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It's been well documented here that my time with BTV wasn't a happy one. However I do realise from my time within this forum that there are many people who are more than happy with the product.
The recent news that subscription costs have decreased must be welcome news, particularly in these hard times. However, let me play devil's advocate for a moment.
Why are BT doing this? Nobody charges less for something than they can, without a reason.
We can't blame the recession. We've just seen Sky reporting profits that continue to go through the roof.
I suspect that a large amount of BTV subscribers will be on Bronze pack (as I was), but now they're going to be Gold customers, meaning that much of the content that they may have decided to pay extra (PPV) for, is now available free to them, further reducing BT's revenue from the platform.
Also, we have recently had a VAT rise (my VM subscription has risen appropriately) so BT's average revenue per customer has fallen even further than the new pricing would suggest.
We all know there is no such thing as a free lunch, so why are BT doing this?
Has the delay of Youview left them with no plan B? Are they trying to hang on to customers at any price, until the new platform materialises?
Is it because of recent reductions in content?
Is it because on-demand librarys aren't really attractive to people, they like TV catch-up (iPlayer, 4OD etc) but they can now get those from their games consoles / PCs / smartphones etc? I have access to a large VOD library on VM (may or may not be better than BTVs) but I never use it.
And what about ESPN? For debate's sake, let's imagine that the wholesale price that BT are paying is say, £8.00 per subscriber (is that unreasonable?) That means that BT is only getting £4.50 for each customer, before VAT and other taxes!
And it's been reported that they're losing money each month on all those that they enlisted to subscribe to Sky Sports.
Whilst I understand that any price reduction is welcome, why? and what does this indicate for the future of the platform?
The recent news that subscription costs have decreased must be welcome news, particularly in these hard times. However, let me play devil's advocate for a moment.
Why are BT doing this? Nobody charges less for something than they can, without a reason.
We can't blame the recession. We've just seen Sky reporting profits that continue to go through the roof.
I suspect that a large amount of BTV subscribers will be on Bronze pack (as I was), but now they're going to be Gold customers, meaning that much of the content that they may have decided to pay extra (PPV) for, is now available free to them, further reducing BT's revenue from the platform.
Also, we have recently had a VAT rise (my VM subscription has risen appropriately) so BT's average revenue per customer has fallen even further than the new pricing would suggest.
We all know there is no such thing as a free lunch, so why are BT doing this?
Has the delay of Youview left them with no plan B? Are they trying to hang on to customers at any price, until the new platform materialises?
Is it because of recent reductions in content?
Is it because on-demand librarys aren't really attractive to people, they like TV catch-up (iPlayer, 4OD etc) but they can now get those from their games consoles / PCs / smartphones etc? I have access to a large VOD library on VM (may or may not be better than BTVs) but I never use it.
And what about ESPN? For debate's sake, let's imagine that the wholesale price that BT are paying is say, £8.00 per subscriber (is that unreasonable?) That means that BT is only getting £4.50 for each customer, before VAT and other taxes!
And it's been reported that they're losing money each month on all those that they enlisted to subscribe to Sky Sports.
Whilst I understand that any price reduction is welcome, why? and what does this indicate for the future of the platform?
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Comments
I'm speaking as a fan of the platform...for what's that worth...so not just having a go.
I think you've probably hit the main points already, problems with YouView, problems getting decent content from the US (there's been articles recently about Sky buying up all of the decent films etc and leaving companies like BT with rubbish), maybe problems attracting enough viewers for the sports channels.
The on demand content is another worry, there doesn't seem to be as much of it on there....and for a service that's built on VOD, that's a real problem.
Personally, I think that YouView will be a success, and that's likely what BT is reducing prices for....keep the punters until it's on stream.
They need a HD box, YouView, and a lot more VOD content, otherwise I think the platform is in trouble.
Makes a great add campaign and pressure on sky , might make people short on money leave sky..
Plus nothing wrong with reducing the prices really, makes things more competitive
You also have to realise as well the things that will help increase customer base so therefore the company can afford to reduce prices
Freeview is becoming more widely available and will continue to do so as the analogue switches off over this year and next therefore more customers can now get Vision
Infinity has launched meaning more customers now have access to Vision due to the line speed been supported on the broadband
Youview will be launching this year too
Fnally reducing the prices will also help increase customer base as they now get the whole package for £12.50
Couldn't agree more.
I think BT are a bit optimistic in thinking Infinity customers are going to be interested in Vision. These people are premium broadband customers who are looking for high quality and are willing to pay for it. They're not the demographic who are looking for Freeview plus some American repeats they've probably already seen on their premiun tv service.
If Youview does launch this year, great, but how will this increase revenue for BTV? It only seems to hold out the prospect of more competitors?
You may be right, getting the whole package for £12.50 might increase the customer base, but if the business model outlined above is remotely right, who wants more customers?
You have to ask yourself, how long before ESPN jump ship?
Bt may give it cheaper to Bt vision users who is coming to the end of their contract, but if you are a BT broadband user and want to add BT Vision, then it is the same price as it always been
No this is not the case, I have looked at BT vision many times, but was put off by the cost for what appeared not a lot!
On the off chance whilst renewing BT BB (Op3) I asked about BTV, they said nothing to do with them, and gave another number which I duly called, they confirmed the new lower pricing of £12.50 for Gold and a free box, and confirmed that was the regular 'new' price, and would have nothing to do with me renewing BTBB, apart from the fact that you need BTBB for BTV !
if you could be bothered to actually look on the website, you will see as from tomorrow the prices for all packages drop to £12.50, crazy i know still having 3 packages all on the same price
how is that then, as they are still keeping all 3 packs, but just charging the same for them, all i can see is they are going to be making things harder for themselves, as they will have everyone phoning them to upgrade them from bronze to gold;)
How is that a bad thing? You will see all companies have active promotions, changes, new offers etc to actively increase calls into sales. After all sales is a business
You have to bear in mind that in all sales companies when a customer calls in to make a change to there account or order a product the sales rep is there to promote all products available.
So for example
Customer Mr Brown might call BT to change from the bronze pack to the gold pack (one might assume i.e. you that this is making things harder)
However Mr Brown might be on the weekend plan and be spending xxx calls on day time calls and therefore on the wrong plan
Sales rep promotes this, and re contracts the customer if customer accepts
Whilst not always the case, its a business
If you go and buy and sofa, I can guarantee they will try and promote and sell to you the sofa protection ;-))))
It's not about price point against any other platform.
It's about BT's price reduction and how it will effect the BTV platform...
And why they did it...
did not say it is a bad thing, jusr saying the line about bt simplyfying things is rubbish in my opinion, if they wanted to make things simple, they could get rid of bronze/silver packs and upgrade everybody up to gold, the line about bt keeping bronze/silver packs open because some people may not want certain aspects is also rubbish as we all know if people can get things technically for free they will regardless whether they will use them or not, i think as others do there must be a more underlying reason to this, and i am not picking for a fight, as i love the vision service
http://www.productsandservices.bt.com/consumerProducts/displayTopic.do?topicId=24694
Err, yes, lovely. And how does this explain the collapse in subscription prices?
i did not see that, but i just had another look and they have now put the price down to £12.99 for Gold.
it does seem a bit strange putting the price down so much, If Bt broadband was better, i may have been interested at that price, but i am not going back to a broadband service that is below what I am getting now even for BT Vision.
Sadly I will not go back to BT, they got to pick up their broadband service first and make it better value for money and sort out their profiling system as well as their traffic shaping.
i hope it does what they want and they get more customers, but I think Sky have it in the bag now looking at how many people have joined over the last 12 months.
I still don't see your issue
People are the first to complain about prices going up
Why should there be a reason for prices going down
It's competitive, simple as
Plus when other companies I.E Sky and Virgin are comparing prices they will now be comparing against the full pack at a cheaper price rather than the basic pack at a more expensive price
As you've said in previous posts, it's a business. Business's aren't in the habit of introducing permanent price reductions in the order of 40-50% without there being some significant underlying issue that they need to resolve.
What that reason is, isn't clear. It may be lack of take up, it may indicate a new strategy for Vision, it may be the competition forcing prices down, but to suggest there's no reason for this massive price reduction is backing yourself into a corner Steven.
I feel this could be the free lunch.
I suspect that Infinity will allow them to have 'live' HD rather than the recorded stuff that you have to download first.
I would expect BBC HD/ ITV HD to come to BTV down the line rather than OTA, this seems to be the only way for BT to roll out HD without having to issue loads of new boxes, which they will presumably want to wait for YouView
all packs have automatically reduced from today to £12.50 be this the bronze, silver or gold, so you may as well switch to gold
in contract or not, the packs have come down in price
now it is 12.50 for the gold and 17.50 sport so 30 quid a month
So I think they have been forced to reduce price because of Sky.
Hmm, maybe but I doubt it. BT already offer a good price for those interested in it's limited Sky Sports offering. At the time of launch, Sky raised their wholesale price meaning that BT may be making little out of each sports subscriber.
So why reduce the price?
To repeat myself... Sky's pricing is holding up. My own VM bill hasn't been reduced, and as far as I know, TUTV and TTTV haven't announced any price drop either, so why the unilateral drop in BT's prices?
As I've thought about this a little more, I'm beginning to suspect that ESPN are about to pull out. They can do that easily as it is "Free" in your BTV agreement. they would then be able to charge those that want the service extra. You have the card, you have the slot....
That's just my theory though...