HBO Going Solo: Shaking up the Cable Business Model

HBOI was thrilled today to hear that HBO has finally decided to detach itself from Cable and is going solo in 2015.  This means that they will be offering HBO as a streaming only option just like Netflix or Amazon Prime.  Yay!  Ever since I committed to lowering my expenses this year I’ve been really hoping that HBO would make this move.  Why?  Because I’ve been considering cutting the cord but I would really miss HBO with excellent shows such as Games of Thrones, Boardwalk Empire, and more recently True Detectives, and did I mention the excellent foreign films? Many people pay for cable just to have access to this content (including me, more on this later).

 

I really do enjoy HBO and more specifically the HBOGO app which allows you to have access on the go or in your own couch to the entire HBO library.   I said it before that I would gladly pay for a stand alone option of this app if HBO ever decided to offer it so I’m really happy they’re finally doing so.  I suspected this move was on its way when HBO announced earlier this year that they had agreed to a licensing deal with Amazon Prime.  However, that deal only allows you to watch content that is 3 years or older which was kind of a bummer because it would not allow viewers to watch the more recent shows such as True Detectives but still I thought it was a step in the right direction at the time.

My Call with Verizon Fios

The timing could not have been better for me.  My two-year Verizon Fios cable contract will be up next week so I was just on the phone with them yesterday to revise my services.  My call was interesting to say the least.

My first interaction was with a regular customer service rep who tried to get me to sign another 2 year contract.

The minute I told him I could not afford to do that and that I wanted to talk about other options he said, “I’ll have to transfer you to an elite customer service rep”.  So I waited for the next level of persuasion.

The “elite rep” immediately informed me that if I wanted to lower my bill she could not make that happen for me unless I signed a contract.  “I said really?, what about these options I’m seeing online that are cheaper than what I have now and with no contract?” She said, “Oh, those are for new customers only.”   I said, “So existing loyal customers get no discounts or deals? That doesn’t sound right.” “Besides, what if I can’t pay the bill for some reason, wouldn’t that be a problem for you if I’m under contract and unable to pay?” She said, “well we would cut the service”.  I said, “Yeah and I would have to pay a penalty for canceling my service early. That doesn’t sound very smart.”

She agreed and went on to find me some kind of deal and just kept saying, “no, no, can’t find anything better unless you sign a contract.”  So I said, “Ok, you know what, Cable TV is a luxury so I’ll just keep internet only and I’ll cut the Phone and Cable TV service.”  At that point she said, “Let me see what kind of deals I can get you if you make that change”.

She came back with a double play option of Cable TV Local, Internet at 50/50 mbps speed and HBO included at no additional cost for $70/month and no contract.  The fact that I could have access to HBO sealed the deal for me so I said yes.  I will be saving $57/month by getting rid of my home phone and going down to TV local only.

Ok, so I know I could get TV local channels for free with an Antenna but I wouldn’t have access to HBO!  But now that HBO has announced a streaming only option for 2015 cutting the cable cord will be a much viable option for me next year and I will be able to save even more!  It’s a win, win for all as I suspect other changes will follow and the current Cable Business Model will finally be overhauled.

Are you an HBO lover? What do you think about this exciting news? What do you think the future of Cable will be?

 

Photo by: Flickr

Comments

HBO Going Solo: Shaking up the Cable Business Model — 10 Comments

    • Many articles have come out since this announcement was made it appears that cable is moving to a la carte. CBS has also just announced they will be offering their content via a streaming app as well. Sounds like everyone will be jumping on the bandwagon.

  1. I think it’s fantastic. I thought they should have done it at least 2 years ago when it was obvious that the Netflix quality of streaming had vastly improved. I hope the cable companies go out if business..lol! Did you sign a new 2 year contract? Or is month to month? Isn’t it just horrible that they don’t care about retaining their old customers? Same for the insurance companies etc..
    Kemkem recently posted…Florence, Italy – Memories of our getawayMy Profile

    • No, I just have a month to month. No more contracts for me! Yes it is a shame that the only deal they offer long time customers is to sign another contract otherwise you pay through the nose. Ridiculous.

    • Yeah, HBO usually charges $19.99/month via a cable subscription. I’m hoping for a max charge of $10/month once it goes solo. But I read analyst are saying it will be closer to $15/month. We’ll see.

    • I think we are getting closer to an “a la carte” business model where cable subscribers can choose and only pay for the channels they want.

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