Shortland Street via Internet
Just had TVNZ do a presentation on the cost of bandwidth in NZ. He asked everyone to guess how much it would cost to deliver Shortland Street every night over the Internet to its 500,000 viewers.
The cost is over the break. No one got it right.
It would cost $120 billion he says!
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Tags: bandwidth, Shortland Street, TVNZ
May 8th, 2008 at 2:33 pm
$240,000 per viewer? Sounds a little extreme!
May 8th, 2008 at 2:45 pm
I’m more amazed that 500,000 people watch Shortland St.
Given that, since youtube can deliver 3,000,000,000 videos a month to roughly 80,000,000 people and still turn a profit I’d have to say I have grave concerns about their cost estimates.
Edit. According to wikipedia, youtube’s bandwith runs to about 30 million a month. Sure its low quality video and economies of scale kick in but it still sounds like TVNZ is off by a couple orders of magnitude.
May 8th, 2008 at 2:45 pm
Does that assume everyone will want to watch it at the same time? If so, that’s an old ‘free to air’ way of looking at things. Digital recording devices will make a huge difference to those numbers.
May 8th, 2008 at 2:47 pm
Sounds like a great reason to stop making the show to me.
May 8th, 2008 at 2:52 pm
$120 billion a night?
May 8th, 2008 at 2:52 pm
Danyl: Google loses money on Youtube, as a result of bandwidth costs of USD$1 million per day.
This is still only approximately USD$365 million PA however. A small fraction of NZD$120 billion!
May 8th, 2008 at 3:00 pm
Did he show how they came up with those numbers?
[DPF: No, and my calculations suggest it may be a magnitude too high]
May 8th, 2008 at 3:06 pm
Im no expert but I would suggest that the point TVNZ is trying to make is about the cost of bandwidth in NZ not the rest of the world.
May 8th, 2008 at 3:08 pm
Did he understand the “over the internet” part? Or was he couriering a DVD to every house hold?
But I got a great idea if it is indeed $120 billion: we just take taxpayers money and give that to rich big corporates so they will bring fibre to every house hold, so it will cost TVNZ only a few million or so.
May 8th, 2008 at 3:11 pm
This figure seems very dubious.
In any event it is nonsensical because:
1 Not all the audience would choose to watch over the internet
2 In many instances multiple viewers watch on one set
3 It implies that such an investment would be purely for Shortland St, even if the estimate is correct
These sorts of numbers are put about for a variety of reasons including:-
1 We cannot do this it is too expensive/difficult/our political masters don’t like it
2 We will not do this until our competition does
3 There is no demand for a quality product
4 We have just launched Freeview and conned the $ from government for that, why should we take advantage of technology convergence and give people what they might want
There are a number of emerging internet TV services/content systems such as Hulu and the BBCs iplayer.
My belief is the $120 billion is totally specious
Much of this issue relates to the fact that our delivery infrastructure is poor, none of the carriers and/or content providers really face the white heat of competition
May 8th, 2008 at 3:12 pm
Streaming in uncompressed HD?
May 8th, 2008 at 3:14 pm
I call bullshit. New Zealand’s GDP was about $110 billion in 2006. So this guy reckons this one activity is more expensive than the sum of all productive activity in New Zealand in 2006. Bullshit! My guess is this is a DPF typo, and the guy actually guessed $120 **million**.
[DPF: No typo]
May 8th, 2008 at 3:19 pm
As a state servant [SOE] God forbid this guy never moves sideways into Carbon Emissions, IRD, or Treasury – or is that where TVNZ got him from?
May 8th, 2008 at 3:21 pm
>>Or was he couriering a DVD to every house hold?
….in a gold box. Hand delivered by a stripper.
May 8th, 2008 at 3:22 pm
I would like to know how they got the $120 billion ( PA ?) number. If Google can deliver far more content for only $US365 million ($NZ430 mil) he must be doing some interesting spinning of the numbers. Perhaps he is talking about delivering HD-SDI data to every viewer not the MPEG compressed data that would actually be used. I watch YouTube content everyday full screen (22″) and though it’s ropey it’s perfectly watch-able.
FM 7: good point about the diversity factor, not everyone will be watching it at the same time though that only affects the capital investment required to ensure the network can handle the peak loads. I guess the point is that bandwidth costs a shitload here: and I suspect based on current retail pricing that is a fair comment.
May 8th, 2008 at 3:23 pm
Or he could just place it on a bit-torrent site.
Cost to TVNZ: $0.
May 8th, 2008 at 3:32 pm
Or he could just place it on a bit-torrent site.
I suspect that’s where tv delivery will head in a few years (when the bandwidth is there). When you punch up a movie or tv show your pvr will peer to peer it from your neighbours instead of downloading from a central location.
May 8th, 2008 at 3:32 pm
Just went to apple.com , the 1080P Iron Man trailer is 198MB for 2minutes 29 seconds. Assuming Shortland Street is 24 minutes of ad free content that makes a total download of 1.8GB an episode. Xtra charges $80 for 15 GB ADSL thats $5.33/GB or $9.60 an episode. Thats $460 per year per viewer (assuming 48 episodes /year) or $NZ23 million for 500,000 viewers at retail rates.
May 8th, 2008 at 3:33 pm
DVD hand delivered by stripper sounds a goer.
May 8th, 2008 at 3:34 pm
Oops – that GDP figure I cited was actually USD PPP, not NZD. Sorry. But my basic point stands – sending a bunch of content over the internet to a bunch of people is NOT in the same ballpark as the entire size of the NZ economy.
May 8th, 2008 at 3:36 pm
So, a one hour HD quality compressed video is around 2GB. 500,000 people delivered to equals 1,000 TB per day. Assuming you paid for it at the exhorbitant rates xtra charges for a pro-extra plan (50GB @ $149, less assumed $30 line charge = $119 for 50GB), that comes to $2,380,000 per day. You would hope to get some sort of discount on that. So what, 5 days per week, 52 weeks per year = $618 million per annum.
So, yeah. I call bullshit too.
May 8th, 2008 at 3:36 pm
Nah, I’m calling shenanigans on that one,
It is estimated that it would cost $5 billion to run fibre to every home, once that happens cost per byte for local NZ traffic is basically zero.
$120 billion per 500K users, is $240,000 per audience member, for a half hour show that is a fairly healthy hourly rate
May 8th, 2008 at 3:38 pm
Damn, halve my numbers. Forgot that Shortland St is only half hour. And god knows why anyone would want that pap in HD, so you could get down to around 500MB per episode. Anyway, definitely not measured in the billions, let alone 120 of them.
May 8th, 2008 at 3:40 pm
National Traffic is free on citylink. 1000mbit connection is around $10k a month. Lrn2internets.
May 8th, 2008 at 3:40 pm
WorldxChange charges only 0.1 cents a MB or about $1 a GB – although they seem to have made it impossible to watch any youtube video longer than about 45 seconds.
May 8th, 2008 at 3:41 pm
Why aren’t any of my comments showing
May 8th, 2008 at 3:46 pm
PaulL: It’s on five nights a week ? Next you will be telling me that it gets Creative NZ funding. My calculation then becomes $115 million pa.
May 8th, 2008 at 3:46 pm
Of course, if Telecom peered locally instead of forcing all our traffic to go over the Southern Cross cable to the US and then back again, the cost would come down astronomically. We should keep pointing out that this is naked anti-competitive behaviour on their part, and that it is one of the most deserving cases of market regulation. Hopefully they’ll decide to do it themselves before the regulation turns up.
May 8th, 2008 at 3:49 pm
Who the hell wants to watch “Shortass Street” – although I am told its good social history – with great gender and ethnic balance. Its full of sex too, I am told by my teen grandaughter!!!!
May 8th, 2008 at 3:51 pm
I’m guessing there would be around 1million households in NZ. $120billion is $120k per household. Easily enough to bring fiber to each household’s living room AND buy them a giant plasma TV AND a couch to sit on while they watch it. With change available to buy each household a new BMW and a jacuzzi.
It was bad enough that Cullen just spent $700million on $400million worth of trains. Just wait for him to announce that he’s going to spend $120billion on about $3.50 worth of television program.
May 8th, 2008 at 3:52 pm
Perhaps the $120 billion figure came from Toll Holdings. After all, they’re good at pulling numbers out of their arses and getting silly old ex-history lecturers to believe them.
May 8th, 2008 at 3:52 pm
>Its full of sex too, I am told by my teen grandaughter!!!!
Using the Internet to deliver pornography… I bet no one has thought of doing that before!
May 8th, 2008 at 3:56 pm
Seriously though, wouldn’t cost more than $50k to set it up and $20k a month to produce on the connection I quoted above.
May 8th, 2008 at 4:00 pm
If TVNZ wants to make some money from this, then they’d have to include advertisements, this would be 30 minutes of programming/advertisement or 2.5GB(ish) using the formula above.
At the Telecom rate of $1.78 per MB
(http://www.telecombusinesshub.co.nz/Internet/Broadband/Pages/Pricing.html), this would be around $4556.60 for TVNZ to allow this to download from their servers. multiply this by 500,000 watchers is $11392000000 so getting close to the $120 billion.
And then they have to think about servers to host all this!
May 8th, 2008 at 4:00 pm
Call me old fashioned, but I’d prefer it hand delivered by a stripper.
May 8th, 2008 at 4:11 pm
Is TVNZ confusing ‘viewers ‘ with ‘households’.
My guess is that 250,000 households is a lot cheaper AND if you are using the US cable style system which you could build for say $5 billion.
Just as well TVNZ isnt in the ISP business
May 8th, 2008 at 4:12 pm
Close, Rupert – but the Telecom rate to which you link appears to be 1.78c per MB, not $1.78.
Perhaps he made the same mistake?
May 8th, 2008 at 4:13 pm
>Call me old fashioned, but I’d prefer it hand delivered by a stripper.
You’d prefer to be handled by a stripper? In that case, $120billion could probably pay for strippers and lap dances for every Kiwi bloke for life. Which would mean full employment for Kiwi women… the good looking ones, at least.
May 8th, 2008 at 4:31 pm
Interesting. Funny how people seem to be trying to poke holes.
If there was no broadcast or other means but distribution via internet throughout a day, then delivering the content to 500,000 people every night would be $120 billion? Thing is, the figure could be calculated as “per night” or for an entire series (year), which isn’t really clear from what you’ve said David (or what TVNZ said). If it was the cost of delivering 500,000 views per night per year, then that sounds a bit more realistic. A bit.
May 8th, 2008 at 4:58 pm
http://www.influxis.com/flash_video_streaming_enterprise2.aspx
Using the most expensive published Influxis FMS plan as a base it would cost around $1million NZ dollars a month.
May 8th, 2008 at 6:19 pm
You sure he said NZ$ and not the Zim$?
May 8th, 2008 at 8:49 pm
ok…. I was out by a factor of 100, so my calculation of $11,392,000,000 is actually $113,920,000, still a frak load of money
May 8th, 2008 at 9:25 pm
Under a National Government led by Our Hero Mr John Key you would get a tax cut, a few SOEs would be sold, and straight away the market would sort out the problem. Just like how privatizing Telecom made phones cheaper and the internet faster.
Oh no, wait, I forgot…
May 8th, 2008 at 10:31 pm
RRM: privatising Telecom did make phones cheaper and the internet faster. Doing it badly made the internet less cheap than it could have been. Don’t mistake a sub-optimal privitisation for all privitisation being bad, and don’t mistake sub-optimal for being worse than public ownership. Do you even recall how things used to be under the post office?
May 9th, 2008 at 12:22 pm
The reason nobody guessed it “right” is because the answer is wrong.
No way in hell does it cost $120bn to deliver Shortland St over the Internet. I build big FTTH, FTTN, and xDSL networks that deliver (amongst other things), TV – it’s my job to know how to do this. Our biggest network to date, with more than 20 million TV subscribers, cost 1/10th of that. And delivers more than one show.
I’m assuming TVNZ wasn’t talking about building dedicated infrastructure to every house (which we already know costs circa $5bn for NZ), so what WERE they talking about? Is the presentation public?
May 11th, 2008 at 4:44 pm
RRM: Of course under a Labour Government led by Our Heroin [sic] Mrs [sic] Helen Clark you would get a tax hike, a few SOE’s would expand (buying an ISP in the process), private property rights would be subsumed by law making, and straight away the state has managed to sort out the problem. Just like how LLU has made Fibre to the home and mobile internet cheaper and faster.
Oh no, wait, I forgot…