Are Cable Companies Looking To 'Emulate' Web Video Sites, Or Destroy Them?

from the face-value? dept

A piece in BusinessWeek says that cable TV companies are "pushing to become more Web-like" by expanding their online video offerings and making their core TV product work more like the web than the traditional channel-delineated system. On the face of it, this is a good thing, since we've long argued that the TV channel is an outdated concept, and should be seen as being like a web bookmark more than anything. But the article largely glosses over one key point in the cable companies' push to grow their online video efforts: they want exclusivity. So instead of throwing things open and using an ad-supported model, like Hulu, they want to take TV shows and video content, and lock it up inside a walled garden for paying customers. That's not "web-like", it's exactly the same as their current business model. Of course, even if these plans don't work out, they've got another way to try and profit from online video: by introducing capped broadband plans that will charge customers based on how much traffic they use. Time Warner's CEO is quoted in BW as saying "we really need to look at what consumers want." It's hard to imagine they want capped broadband, and they want video locked up behind paywalls. The popularity of the likes of YouTube and Hulu indicate they want something very different from what the cable operators have in mind.


Reader Comments (rss)

(Flattened / Threaded)

  1.  
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    Bill G, Apr 3rd, 2009 @ 6:19pm

    Sigh

    After reading this and other articles and reading what others have posted. I can only think it is will only open one new market when it closes many others, but it will not really make any new markets. This will only have the makers of home routers add traffic monitoring tools so you can alert yourself when you are getting close your transfer cap since that is the one thing that will be hard to monitor from multiple devices at the same time.

     

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  2.  
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    toddlorensinclair, Apr 3rd, 2009 @ 7:55pm

    video content inside a walled garden for paying customers on capped broadband

    You nailed it ... if they can't lock you in to cable tv they'll cap your internet to discourage free tv.

    Most people have no choice ... only 1 provider available.

    This is one of those instances where "There ought to be a law"!

     

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  3.  
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    Weird Harold, Apr 3rd, 2009 @ 8:22pm

    In the long run, this is an issue that is likely to end up in court, but not exactly for the reasons you would suspect.

    Free TV over the internet (especially at the point where the picture quality is comparable to the quality of cable, say 8Mbps or so) will raise issues of rights, fees, and payouts. Example, if a cable company does not carry channel A, but one of their subscribers views it via download, would the cable company be liable to pay fees?

    Conversely, if the cable company is paying a fee, but the internet user can watch the channel online without subscribing to the channel, is the cable company paying for nothing? Should the fees paid by the cable distributor for carriage by rescinded?

    Is the TV channel that streams or distributes content violating their agreement with the cable companies semi-exclusive distribution deals?

    Where does net neutrality come into all this? Are the cable companies obliged to offer no cost (to the channels) distribution on their networks, considering that it is direct competition for their cable dollars?

     

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  4.  
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    Gene Cavanaugh, Apr 4th, 2009 @ 10:05am

    Entertainment content on the web

    Great article, overall, but it ended badly when you "pegged" again.
    Bandwidth capping depends on why it is capped, and who caps it. If the purpose is to gouge, then you are right. If the purpose is to prevent DoS-type activity, then it is good, and pegging at an extreme position doesn't change that.
    Of course, if the wrong people control the capping, it will be abused, and you are right - but that is not the only possibility, and pretending it is keeps many people (including me) from supporting your position.

     

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  5.  
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    Andrew D. Todd, Apr 4th, 2009 @ 11:39am

    Phased Array in Space.

    I think Weird Harold is mistaken about what will happen with the cable companies.

    In the long run, in nearly every kind of radio operation, phased array changes everything. This has long been a well-known fact in respect of military radio, but the price-tag has traditionally been too high for anyone except the military. Now that is changing. The central fact about an electronically controlled phased array antennae is that it has about five or ten times the angular resolution of a dish antennae of comparable size and frequency, and that it can track a moving target easily.

    http://www.techdirt.com/article.php?sid=20060620/0318228#c47

    This has application to terrestrial wireless, of course, but it also has application to satellite broadcasting. At present, direct broadcasting satellites co-exist in geosynchronous orbit largely because they only broadcast through antennae aimed at their own countries, or else they broadcast on different frequencies. However, when phased-array cuts in, economic rationality dictates that a satellite should broadcast different programs in all directions, on all possible frequencies, so as to most effectually recover the costs of launching. The additional electronics required for this are subject to Moore's Law, of course. What this might work out to would be that you might suddenly have access to at least twenty different satellite television broadcast systems, coming not only from the United States, but also from Europe, Japan, Brazil, Russia, India, and China, and maybe others as well. The satellite launches will very probably be government-subsidized, for reasons of national prestige, and the launching organizations will be full of former national air force officers. Under that kind of brutal competition, the notion of having to subscribe to a particular satellite service, or pay monthly fees, will break down. The Brazilians, Chinese, et., al. will just transmit their signals in the clear, so that anyone can tune them in without a decoder card. It will be like what listening to short-wave radio used to be like-- free access to all the world. Each new country's broadcast satellite program will conform to evolving technical standards, so that one receiver works for all the satellites, and the receiver will only cost fifty dollars or so The satellite systems will try to charge content providers to transmit over their systems, and if they fail, as they probably will, they will scream "economic discrimination" to their governments, and get permission to broadcast American DVD's. What it comes down to is that broadcast bandwidth is not really a very scarce commodity, assuming one uses it with some degree of economy, eg. using video recorders. The practical effect of phased-array satellite broadcasting will be to untraceably (*) plug the average American into the Rangoon "street market" in bootleg videos.

    (*) Like Radio Free Europe waves in the Soviet Union during the Cold War, the radio waves will be everywhere, only they will be much harder to jam.

    Outer space is like the high seas. It is beyond the ordinary operation of national law. Indeed, the state-of-the-art place to launch a communications satellite from is a ship in the middle of the Pacific Ocean. The ship can put out to sea from Shanghai, or Mumbai, or Karachi, or Djakarta, or... The United States Navy is _not_ going to put out to sea and fight a naval battle with the Chinese, just so that Time-Warner can make more money. Forget about it!

    http://en.wikipedia.org/wiki/List_of_satellites_in_geosynchronous_orbit

    The comparative advantage of the cable companies' landline networks lies in two-way communication, such as high-speed video telecommuting, with guaranteed availability. The cable companies will have to gradually transform themselves, rebuilding their networks from the top down, putting in more optical fiber, and breaking down shared coaxial cable into smaller chunks. Also, they are going to have to learn to behave like common carriers.

     

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  6.  
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    Weird Harold, Apr 4th, 2009 @ 2:35pm

    Re: Phased Array in Space.

    I think Weird Harold is mistaken about what will happen with the cable companies.

    No, I am just smart enough to know the difference between looking at the future and treating the future as a fait accomplis.

    You can install that nice antenna next to your flying car and wire it into the 3d holographic projector in your self-cleaning house. Ask your robot maid, she can do it for you.

     

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  7.  
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    Anonymous Coward, Apr 5th, 2009 @ 4:59pm

    Re: Entertainment content on the web

    Gene,

    Again, I must point out your use of a term for which you know not (hopefully) its street meaning. look up pegged.

     

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  8.  
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    Anonymous Coward, Apr 5th, 2009 @ 10:16pm

    Re:

    ...if a cable company does not carry channel A, but one of their subscribers views it [channel A] via download, would the cable company be liable to pay fees?

    No, why would it? In what world would my cable company be responsible for my actions outside of it's cable service? Or my actions inside of it's service, for that matter... It would be like saying I have Cablevision with Channel A and I go visit friends in a Comcast area with Channel B. What if I didn't have cable and watched a cable channel elsewhere? Should I pony up for my viewing? What if I'm at an electronics store with cable on display? Should Cablevision be liable for what I watched elsewhere? Hell, no. That is a dumb troll question.

    Conversely, if the cable company is paying a fee, but the internet user can watch the channel online without subscribing to the channel, is the cable company paying for nothing? Should the fees paid by the cable distributor for carriage by rescinded?

    Nope, the agreement between the cableco and the network has nothing to do between the cableco and the consumer or the network and the consumer. For instance, I can watch House online on the network's website or on my TV. As long as I pay my cable and Internet bill, why does it matter? My cable company paid to be one of many companies offering this service, not to be my exclusive company, roflmao.

    Is the TV channel that streams or distributes content violating their agreement with the cable companies semi-exclusive distribution deals?

    In what world do networks offer exclusive deals to certain cable companies for certain shows? Not in this syndicated world. Roflmao, troll, roflmao.

     

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  9.  
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    Rob, Apr 6th, 2009 @ 11:35am

    Re: video content inside a walled garden for paying customers on capped broadband

    Everyone has a choice in cable TV: to get it, or not. People do not have a right to TV, and they certainly do not have a right to have whatever they want, just because they want it.

     

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