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Re: peering charges?

  • From: Sean Donelan
  • Date: Mon Jan 27 04:41:29 1997

>What do you think the final outcome will be ? If TCI cant find a way to
>recoup these costs from subscriber or advertising fees, the costs will
>trickle down to the users.  Just because FoxSports went after  TCI for
>what would seem like convenience of billing and collection doesnt mean
>that the end user wont end up with the tab for the distribution of this
>Compelling Content. And I am sure if TCI subscribers want that content,
>they would mind paying the extra 8c. 

Depending on how competitive the market is, TCI may pass the cost
on to either their customers (higher rates) or on to their shareholders
(lower earnings).  But instead, I expect TCI will choose to drop some
other channel that has a smaller, less vocal following.

If it is for convience of billing and collection, why wouldn't an IAP
get dragged into paying for MTV?  I'm sure it would be more convient
for VIACOM to charge InternetXYZ one invoice for $1 million, rather
than billing each of XYZ's IAP customers.

Follow the money always works.  In the pipeline example, the pipeline
company only collects money from the shipper.  If the pipeline company
sold the pipeline contents itself at the delivery point, I'd expect the
shipper would want a cut of the money. As long as IAPs are charging money
on both ends, expect producers of compelling content to want lower prices
from the sending IAP side, and a cut of the money on the receiving IAP side.

In any case, I don't see how the IAPs expect to be left out of it.  As
soon as they have a functioning system for transfering funds between
themselves, aka settlements, I expect IAPs to become ground zero for
the money scramble.
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