You’re missing the point, it’s not about the prices.
gohixo9650@discuss.tchncs.de 8 months ago
If not, we can expect to see legal channels raising their prices again to cover the losses caused by piracy.
what a shitty take. Well, anyone who has better memory than only one month back can realize that the reason the people turned to piracy was that they raised their prices. There is no loss caused by piracy. They only missed potential gains. And the reason they raised their prices were not because they were loosing money. Was because they needed to “grow infinitely”. If the free market evangelists are right, the free market will self regulate and the prices will go down in order to attract back the lost customers lol
Bluescluestoothpaste@sh.itjust.works 8 months ago
gohixo9650@discuss.tchncs.de 8 months ago
enlighten me then
Bluescluestoothpaste@sh.itjust.works 7 months ago
It’s about the service.
poopkins@lemmy.world 8 months ago
I’m not disagreeing with you—the conclusion these services have taken are indeed not logical ones based on historical trends—but I’m curious how you know these services didn’t need to raise the fees? Why have you assumed that it’s to “grow infinitely”?
From my understanding, almost all streaming video providers except Netflix have been operating on a loss. That can only be sustained for so long before the parent company will need to see it begin to generate a positive revenue stream. The most straightforward way to do that is to increase subscription fees. Furthermore, the number of subscribers of Paramount+, MGM+ or even Disney+ is certainly not trending towards “infinite growth.”
I’m not justifying anything, because with five monthly services that have been hiking prices I’m looking at what to slash myself, but I was eager to encourage a bit more discourse on this topic.
gohixo9650@discuss.tchncs.de 8 months ago
then their model is flawed. They sell something at loss in order to attract customers because they know that if they sell it at higher profit margins customers will not come. Customers are willing to buy it as long as it is in a price that they are willing to compromise at. So, when they raise their prices, customers realize that now it is above the price they are willing to pay and step out. Their model is based on hoping that the customers will forget or be bored to cancel a subscription that they cannot afford anymore. However it is a subscription that they wouldn’t had been willing to buy in this price in the first place.
So, their initial market share and adoption rate was what it was because of the price of the subscription and the rate of price/value-of-product. Customers are not willing to pay double price and they wouldn’t had paid it in the first place. They are not loosing customers. They are not loosing potential profit. They are basing their numbers in a faked artificial audience that opted in only because it was a good deal in the initial price.
And while the free market evangelists would argue that the market would self regulate, you know what will they in reality do? Ask the government for stricter enforcement of anti-piracy laws because huge loss . Loss based on nothing but their imagination of imaginative potential profit based on “if everyone was continuing buying our product with the same adoption rate we would had X billions. So since we don’t have X billions, this is a loss”. Great math skills and applying of logic.
poopkins@lemmy.world 8 months ago
There are certainly consumers out there with this kind of mentality, but it’s a common sales strategy to lure new customers with a reduced subscription fee for the first months only. It evidently works, because businesses have been doing this long before SVOD services, or even the internet for that matter, existed.
I expect that indeed, a significant number of customers cannot be bothered to cancel a subscription once they begin to use it, or, put another way, perceive the value of it to be justified against the increased price. I don’t think it’s fair to call this a fake audience, because these are real users of which a certain percentage will be retained.
Another factor that probably weighs into this is the competitive race to the bottom among the many SVOD offerings that are available today. Users like you and me perceive a certain dollar amount as the maximum that we are willing to pay, but where does that figure come from? If you are a new player in this space, you are effectively capped to the current market price for subscription fees, whether or not that covers your costs.
The free market effect will gradually resolve this as services that are all currently operating at a loss will correct their price models, which is what I believe is currently happening.
gohixo9650@discuss.tchncs.de 8 months ago
Your claim that this is a tactic happening since for ever doesn’t take into account the differences between subscription model and traditional businesses. In traditional businesses, yes, a business may decrease the prices in order to lure customers, but this was never their business model. This was limited time “get to know us”. I don’t think there was for example any supermarket operating at loss for 5 years before they decide to “ok, lets put the real prices on the shelves now”.
of course it is a fake audience. The fact that some users will be retained doesn’t make the 100% of the audience real. And also by fake audience it doesn’t necessarily mean that the whole 100% of the audience is fake. However, when they present their numbers, and they claim that “because of piracy we lost 5 million subscribers” this is based on the 5 million subscribers who potentially would never be subscribers if they had their “real” price upfront, instead of a price in which they operate at loss.
However, when people are charged for piracy, they are charged based on imaginative loses who are based on a potential profit which would had been achieved if their 100% of customer base had been continuing paying a subscription which they would had never agreed paying if the price was not faked in order to attract them.
the free market will turn to the government to cover their losses and they will push for stricter anti piracy law enforcement. The free market evangelists just want a free to control market. I don’t think they will be “ok, customers are leaving after our latest increase in price, then let’s just decrease the price to get them back on board”
Tristan@lemmy.ca 8 months ago
Nuanced post. Than you!
poopkins@lemmy.world 8 months ago
Why is this being downvoted? I thought Lemmy was a place for discourse? How does this not contribute to an open discussion?
homicidalrobot@lemm.ee 8 months ago
Pretty common take that people feel like they’ve seen and argued in a lot of other places. In the future, ask YOURSELF why you got downvoted, not the thread. Works way better.
poopkins@lemmy.world 8 months ago
I have genuinely asked myself this, and can’t help but find it strange that the only comments in this thread and other almost identical threads are effectively complaining about corporate greed, and never go into any kind of depth about underlying causes and contributing factors.
Why instead is the same old empty rhetoric repeated and upvoted time and time again? This platform seems to be an echo chamber for ignorance.