Saturday, June 03, 2006

Market Pricing

One of my biggest hope for the TV on IP revolution is that the cost of content is determined by the marketplace, not by a bunch of middlemen in Switzerland (for sport) and LA (for entertainment).

Imagine you want to watch your favourite sports side play away (out of market) and you realise that you won't have an opportunity to see it since no one has picked up the rights locally, or worse still, the rights have been picked up but aren't being exploited.

So, why not team up with a bunch of fellow fans and bid together for the rights? You could even outbid the tv company.

All of a sudden, a real time marketplace is created.

However, as with the TV advertising market, the old, inefficient world order is difficult to change since the status quo suits all the incumbents. This morning Chelsea, possibly the wealthiest sports club in the world spent £12m on ensuring a young player didn't go to a rival club. You may regard the £50m spent over the past 2hoursse by Chelsea as being the hubris of a billionaire, but it has the knock on effect of the cost of soccer rights ballooning and creates a highly inefficient marketplace.

There's little doubt that there will be a considerable amount more competition in the entertainment marketplace thanks to TV on IP, but will it result in a better deal for viewers ?

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