While cable programming vets Dan York and Terry Denson toil respectively at AT&T and Verizon to craft the kind of video packages that can lure subs away from cable and satellite, others are busy trying to figure out when — if — the payoff will come for the telecoms. Count Sanford Bernstein analyst Craig Moffett among the skeptics: “It’s awfully difficult to see how a late entrant operating at a dramatic cost disadvantage and employing a strategy of charging less for more has any shot at earning acceptable returns.”
Some are enjoying the disruption caused by new entrants. As Sean Bratches, EVP-sales and marketing for Disney’s ESPN and ABC, told the Times: “We are enamored of the fact there will be more gatekeepers in the marketplace.” He also says not to assume — as have some trying to estimate the programming costs — “they’re paying a big premium.” The Times talks about Disney creating a new revenue stream by getting Verizon to pay a fee for access to the company’s broadband sites; from another perspective, it’s more like splitting the main stream to reflect value for different elements and to make it a new line item going forward. Still, it shows how serious Disney is about broadband as a separate revenue stream and how willing Verizon is to make the right deals.
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