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story category Game Consoles Vs. the Cable Box
Industry ponders the threat, does nothing
(old news - 02:10PM Tuesday Apr 11 2006)
tags: Video · competition · hardware · gaming
A panel this morning at the cable industry's National Show in Atlanta focused on broadband gaming consoles, and their threat to the cable industry's set-top dominance. The conclusion of the panel was that so far, such gaming systems are more complimentary than competitive. The National Show blog offers up the following statistics:
"Michael Cai, the panel moderator, opened with some interesting statistics indicating 52% of Internet households have a gaming console. For cable operators, that means that 70% of cable High Speed Data subscribers are playing games (PC or otherwise) and 35% are playing on a console."
While cable operators have shown some interest in offering games, any such deployment would largely be simpler titles deployed via existing set-top partnerships. Of course there was similar talk at last year's show, as we mentioned then. However plans to offer even Texas Hold 'em via your cable box haven't materialized.

Sony, Nintendo, and Microsoft are positioning themselves as competitive video and set-top threats, though the seeds of such plans are only just being planted with this generation of consoles. Microsoft has struck a deal with DirecTV and may offer downloadable video content via an added "blade" on the system's dashboard.

You can expect Sony and Nintendo to follow-suit with their consoles later this year.

With consoles now sporting hard-drives, of particular focus will be the ability to offer consumers high definition content, which should get the cable industry's attention.

The consoles may ultimately offer place-shifting as well, possibly before the cable industry can even get past negotiations with broadcast lawyers.

Related:
  1. Blockbuster Broadband Video Box A Disappointment
  2. CES: Dish, Verizon Showcase Remote DVRs
  3. Cox Gears Up for Multi-Room DVR
  4. Netflix Says No PS3 Streaming....Yet
  5. Cox Multi-Room DVR Looms
  6. AT&T Offers Free iPhone U-Verse DVR App
  7. What Network Neutrality Is REALLY About
  8. Cable Industry: Shucks, Guess Nobody Wants CableCARDs
Forums » Game Consoles Vs. the Cable Box
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moonpuppy

join:2000-08-21
Glen Burnie, MD
·Verizon Online DSL

This should be a lesson.....

Don't try and compete with something already established UNLESS you are willing to spend a ton of money.

Game consoles have been around for a while so why compete with them?

Plus, they go out of style and obsolete in a few years.

Partnerships are win-win for companies.

Cheese
Premium
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Naples, FL
clubs:

Blech!

Viva La PC Gaming!

dadkins
Can you do Blu?
Premium,MVM
join:2003-09-26
Hercules, CA
·Comcast

Re: Blech!

said by Cheese See Profile :

Viva La PC Gaming!
AGREED!
I can take this laptop with me where ever I go and play games.
Console? NOT!
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Cheese
Premium
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Re: Blech!

said by dadkins See Profile :

said by Cheese See Profile :

Viva La PC Gaming!
AGREED!
I can take this laptop with me where ever I go and play games.
Console? NOT!
Yep
DustinR

join:2001-12-03
Ottawa, IL
How many games can you actually play on your laptop?

dadkins
Can you do Blu?
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join:2003-09-26
Hercules, CA
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1 edit

Re: Blech!

said by DustinR See Profile :

How many games can you actually play on your laptop?
Any game I wish, why?
So far, it has played every game I've thrown at it.

EDIT: This isn't a $599 El Cheapo laptop.
It's also my TV, DVR, Stereo...
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amungus
Premium
join:2004-11-26
America
clubs:

who would want...

to play some cheezy excuse for a game through their cable box. ..this sounds like a rehash of the sega saga.

so if anyone wants a simple game, available through the net, on their tv, they are going to most probably think Nintendo, and they would be right.. I guess the 360 has old-school games available, but I imagine the big N drawing a bigger crowd for a lot of games. besides, the new controller looks like a remote that belongs right next to the tv remote

don't care to turn a tv box into a poker box, but could you imagine the tons of people who would probably waste their lives (and monies) away?

..really don't get the idea of a game console being any sort of threat here.. it is a complementary thing.

mbernste
Boosted
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Study your history

Those who don't study history are doomed to repeat it.


said by Intellivision Lives Web Site :
Introduced in 1981, PlayCable: The All Game Channel enabled local cable operators to send Intellivision games over the wire with the TV signal. Subscribers used a special converter -- the PlayCable Adapter -- to download the games to play on their Intellivision Master Components. While reportedly popular in the areas in which it was available, PlayCable was discontinued in 1983.

The PlayCable Company was a joint venture of Mattel and General Instrument, the company that designed the Intellivision chip set. The units themselves were manufactured by General Instrument's Jerrold Division, which supplies cable TV converter boxes.

The PlayCable matched the original Intellivision Master Component in design. It plugged into the Master Component's cartridge slot and hooked up to the TV cable. Switching on the Intellivision brought up several pages of on-screen menus, displaying the available games. Twenty titles were available at a time, rotated monthly. The object code for these games was being continuously broadcast over the cable; when one was chosen, its code would be "tuned in" and fed into the PlayCable's memory (taking about 10 seconds). The Intellivision would then read the PlayCable's memory as if it were a game cartridge.

Several factors contributed to the systems demise:

The PlayCable Adapter contained insufficient memory to download the larger (8K and above) games introduced in 1983. The converter boxes would either have to be upgraded or the system limited to older games.
With the growing number of channels that subscribers were demanding ("I want my MTV!"), most cable operators felt reserving bandwidth for PlayCable wasn't worth it (especially considering the hardware investment needed to provide the service).
At least two people figured out that a PlayCable could make a dandy Intellivision development system. By hooking up a personal computer to a PlayCable and poking around by trial and error, they quickly decoded the EXEC software and started writing their own games. While these two were kept from competing with Mattel by hiring them to program the Intellivision Bump 'N' Jump arcade conversion, management was afraid PlayCable would make it too easy for small companies to get into the Intellivision-compatible business.
Subscribers rented the PlayCable Adapters from the cable companies. When the system was discontinued in 1983, the adapters had to be returned.

Source: »www.intellivisionlives.com/blues···ech.html

gheezer
Compooters R Us
Premium
join:2002-12-20
Henrietta, NY

Not quite sure how this can be interpreted as a threat...

Set top boxes aren't serious revenue gerators anyways.

Microsoft, Nintendo, et al...those crafting gaming consoles, are more of a threat to the likes of Motorola and Scientific Atlanta...the better question form this entry should be...why aren't SA and Moto involved in developing the Cable Game console?

What this actually represents, is an evolving potential revenue stream...the technology which, is not quite mature enough for reliable billable delivery.

Seems like a smart move to allow the technology to mature before attempting to deliver it....then again, it's not that far of a stretch to view a content delivery method similar to that of VOD.
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Karl Bode
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Re: Not quite sure how this can be interpreted as a threat...

quote:
Not quite sure how this can be interpreted as a threat...
An alternate platform for delivery of HD content, TV programs, films, and other content? Over the cable industry's pipes but not via their TV delivery mechanism? There's some interesting dynamics to play out there....

gheezer
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Henrietta, NY

Re: Not quite sure how this can be interpreted as a threat...

The Cable Company's content deliver network is privately owned and privately maintained. The Telco has no right to use private local infrastructure.

I still don't see the threat to the MSO, what I see is an untapped revenue source. Unless the various municipalities give up the franchise fee and the MSO's are compensated for building the local content delivery infrastructure.
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Karl Bode
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Re: Not quite sure how this can be interpreted as a threat...

quote:
The Cable Company's content deliver network is privately owned and privately maintained. The Telco has no right to use private local infrastructure.

I still don't see the threat to the MSO, what I see is an untapped revenue source. Unless the various municipalities give up the franchise fee and the MSO's are compensated for building the local content delivery infrastructure.
Are we talking about the same thing? "Cable TV" channel bundles are about to be made irrelevant by 87 content providers offering a la carte video 37 different ways from Sunday.

An XBox 3 offering HBO programs a-la carte in HD over their own pipes, bypassing their dinosaur business model, not a threat? Are you kidding?

gheezer
Compooters R Us
Premium
join:2002-12-20
Henrietta, NY

Re: Not quite sure how this can be interpreted as a threat...

XBox doesn't OWN the pipe, that's the whole point.

Pay the MSO's the TENS to HUNDREDS of BILLIONS of private monies they've invested..and then others can have unfettered access.

No I am not kidding.

If the cost to deliver local content were small, someone OTHER than the MSO's WOULD HAVE Buit local deliver infrastructure nationwide by now.

Sure...FIOS is coming, but unless you own a bare minimum 1/4 million dollar house, it aint coming anytime soon.

Existing cable infrastructure passes over 100 million homes RIGHT NOW. And in 2 years, it will be capable of carrying 500mb/s of data and content. here's the key now, pay attention....this is impportant...IT WAS ALL BUILT WITH PRIVATE MONEY AND IS PRIVATELY OWNED.

And 2 years from now, it will STILL be privately owned, NOT subsidized by taxpayers, and NOT subject to open access laws that the TELCO's are.
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Karl Bode
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Re: Not quite sure how this can be interpreted as a threat...

quote:
XBox doesn't OWN the pipe, that's the whole point.
That is irrelevent to this discussion.

Likewise, I'm not even talking about TelcoTV. They have the same problem to face - worse, because they're not even built out yet. I think you're arguing a completely different point from what I'm discussing.

My point is that if users paying $50 for 10Mbps can still download a la carte content (just the shows they really like) from a growing number of other companies, networks, film houses at reasonable prices- it's very likely they will stop subscribing to Basic and expanded cable, eliminating a massive source of revenue.

That is a very real threat.

gheezer
Compooters R Us
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join:2002-12-20
Henrietta, NY

Re: Not quite sure how this can be interpreted as a threat...

The trend with Cable consumers for the past several years has been AWAY from plain ol TV anyways.

As the internet has matured as a technology, content delivery has been changing as well...as has the Cable company's home user's demographics changed.

At the MSO I work far, plain jane TV subscriber counts have been fairly static(even declining a wee bit), while Digital services subscriber numbers have doubled and Cable Internet subscriber counts have more than doubled in the past 3 years.
(read that as IP based content delivery)

Revenue is still climbing.

But the change in customer demographics has NOT been lost on investors and upper management.

More than anything else, this change in Demographics has been lost by HOLLYWOOD and NY City, where the OLD business model of Programming availability is being threatened by INTERNET access.

I suggest you study Yahoo's content delivery method (read that as Akimai's business model)...and just carry that a step closer to the consumer...the MSO head end or the Telco CO.

It's up to the content owners and Programming providers to change the business model. But whether it's by Cable Internet or Cable Box, Cable will still be a player.

But to what extent, that remains to be seen.

still....the "Franchise Fee" model is probably doomed by IP based content delivery...I think we agree with that.
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Re: Not quite sure how this can be interpreted as a threat...

quote:
As the internet has matured as a technology, content delivery has been changing as well...as has the Cable company's home user's demographics changed.
Time Warner this week stated that 60% of their customers still only subscribe to one service. 6% were actually signing up for the triple-play. I think the demographic change exists, but is hyped by wishful thinking execs who want everyone paying $200 for the quadruple play.

I'm starting to wonder if incumbents shouldn't just make high-quality pipes their business and get out of content distribution altogether (unlikely I know, as ads fuel all of it).

quote:
It's up to the content owners and Programming providers to change the business model. But whether it's by Cable Internet or Cable Box, Cable will still be a player.
Of course, the network is there and will be used. But above you suggested there was no threat. I'd argue that the possible dissolution of an entire content business model by dozens of hungry competitors is, well, a threat.

gheezer
Compooters R Us
Premium
join:2002-12-20
Henrietta, NY

Re: Not quite sure how this can be interpreted as a threat...

I think the MSO's have been much more adept to changing technology than the Program and content providers have.

What makes you think they won't be able to adapt to a change in content and programming delivery?

Please PLEASE convince ESPN and Discovery to STOP bundling their packages. THEN you WILL have your A-LA-Carte delivery.

Even the MSO's would like this.
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Karl Bode
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Re: Not quite sure how this can be interpreted as a threat...

quote:
What makes you think they won't be able to adapt to a change in content and programming delivery?
Certainly is possible, but being massive and frequently stubborn outfits staffed with old-schoolers, I imagine true pricing and content innovation will come slowly and possibly too late.

Part of the downside of being in a lumbering, stumbling monopoly or duopoly where your systems aren't constantly competitively battle tested (see, RIAA).

Usually the first reaction to emerging competitive threats (at least from the massive companies) isn't to innovate, it's to clamp down on everything. Lock down content, bring out lawyers, sue competitors, strike huge restrictive content agreements....

gheezer
Compooters R Us
Premium
join:2002-12-20
Henrietta, NY

Re: Not quite sure how this can be interpreted as a threat...

said by Karl Bode See Profile :

quote:
What makes you think they won't be able to adapt to a change in content and programming delivery?
Certainly is possible, but being massive and frequently stubborn outfits staffed with old-schoolers, I imagine true pricing and content innovation will come slowly and possibly too late.

Part of the downside of being in a lumbering, stumbling monopoly or duopoly where your systems aren't constantly competitively battle tested (see, RIAA).

Usually the first reaction to emerging competitive threats (at least from the massive companies) isn't to innovate, it's to clamp down on everything. Lock down content, bring out lawyers, sue competitors, strike huge restrictive content agreements....
This aint the Cable companies issues you're addressing, it's the Content Owners.

Cable didn't sue and shut down Napster. The content copyright holders did.(RIAA and MPAA)

Cable MSO's deployed, in the past 5 years, VoD, VoIP, Docsis 2.0, HiDef TV, and also (mandated by the federal gov't) - Digital/Analog simulcast.

Ths standard 550mhz analog cable plant is almost entirely GONE from the American cable scene..in 5 years..!

For an industry that employs several hundred thousand people, I'd say, within 5 years, adopting and deploying these new tochnologies, is EXTREMELY adept.

The Cable companies aren't as threatened as you may suspect...they will adapt, as they always have. The ones who HAVEN'T adapted are the content owners and copyright holders.(Yes, the likes of ESPN and Discovery MUST unbundle, the consumer is demanding it)

And this "lumbering, stumbling monopoly/duopoly" you refer to? THIS IS THE MODEL YOUR LOCAL GOVRNMENT INSISTED ON.

This is the "Franchise fee business model" YOUR LOCAL GOVERNMENT employs, and which IP Content delivery will bring to an end.
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Karl Bode
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Re: Not quite sure how this can be interpreted as a threat...

Yes, the my employer's industry (or my favorite technology, company, graphic's card maker, PC maker) does no wrong and is the very best. I've heard that speech. More of a humanist and believer in entropy, myself.

I'm aware the cable industry has done some very positive things with network upgrades. I'm also aware the duopoly system was created by a dysfunctional well paid government. I'm also aware cable will try to adapt.

I'm not sure any of that makes much of a difference when disruptive technology completely blows up control over a business model. The RIAA is learning it. Cable is next at bat. Not sure VoIP providers won't see their models go up in smoke too, thanks to free-voice.

gheezer
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1 edit

Re: Not quite sure how this can be interpreted as a threat...

C'mon Karl, just because I work for an MSO does it mean I'm clueless or entirely partial?
(I work the engineering side and don't get involved in politics or management)

If any point I've made is wrong, refute that point, but don't discredit the points by trying to discredit the messenger.
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Karl Bode
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Re: Not quite sure how this can be interpreted as a threat...

Your "message" thus far has been that the cable industry is largely infallible, adjusts quickly and efficiently to all competition, and is the poster-child for innovation and deployment.

Oh, and the flood of competing video services pose "no threat" (see your original post subject). Does that about sum up your position?

gheezer
Compooters R Us
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Henrietta, NY

Re: Not quite sure how this can be interpreted as a threat...

said by Karl Bode See Profile :

Your "message" thus far has been that the cable industry is largely infallible, adjusts quickly and efficiently to all competition, and is the poster-child for innovation and deployment.

Oh, and the flood of competing video services pose "no threat" (see your original post subject). Does that about sum up your position?
No, my message thus far, is that the cable industry is not so severely threatened as your news article indicated.

Also, the Cable companies are not the only people indictable in the content delivery war that is developing...the likes of ESPN and Discovery channel and the xxAA's have much more to answer for here.

The ultimate winner here, if Congress can avoid more scandal, SHOULD be the consumer. And the Cable companies will still be a viable player, however this shakes out.

The Cable companies will adapt.
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Karl Bode
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Re: Not quite sure how this can be interpreted as a threat...

Well, we've gone from you denying any threat to stating cable is "not so severely threatened."

We're bridging ground.
quote:
The Cable companies will adapt.
Time to start.

gheezer
Compooters R Us
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Henrietta, NY

Re: Not quite sure how this can be interpreted as a threat...

I believe my 1st post was..I really don't see the threat.

I still don't.
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Karl Bode
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Re: Not quite sure how this can be interpreted as a threat...

Good luck with adapting to a threat you don't even see, then.

gheezer
Compooters R Us
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Henrietta, NY

Re: Not quite sure how this can be interpreted as a threat...

Doing business in America is never without risk.

Doing a technology oriented business is even riskier. Technology changes very rapidly.
As it has over the past 50 years for Cable.

Cable will be ok.
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Karl Bode
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Re: Not quite sure how this can be interpreted as a threat...

quote:
Doing business in America is never without risk.
Doing a technology oriented business is even riskier. Technology changes very rapidly.
Don't recall saying anything that disputes any of these points. Only that a threat exists in indie content distribution. A threat you deny.
BVT

join:2004-10-25
Mount Juliet, TN

Re: Not quite sure how this can be interpreted as a threat...

I like corn

gheezer
Compooters R Us
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You're right..I don't see the threat you see.

Karl Bode
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Re: Not quite sure how this can be interpreted as a threat...

Lets both bookmark this thread and check back in two to three years.

After Amazon, Google, iTunes, and about a billion indie film & IPTV services have launched.

After each major console has started offering HD content downloads.

After Netflix begins offering high-def film download rentals.

After each major industry movie studio begins offering film download rentals.

After each major network and outfits like HBO begin to realize they no longer need you.

After the telcos have made some headway with IPTV deployment.

After the increased deployment in broadband allows every kid with a copy of Bit Torrent to download HBO and TV episodes in minutes, days before they even air.

I know the cable industry has faced some challenges, but they've never seen anything like this. This is utterly disruptive.

Good luck with the non-threat, godspeed.

i1me2ao
Premium
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TEXAS
·Comcast

thank you president of time warner. we pay for access. i pay taxes on this service on this limited service. also cable may be capable of carrying 500mb in newyork but that is all.
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jslik
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said by gheezer See Profile :

Unless the various municipalities give up the franchise fee and the MSO's are compensated for building the local content delivery infrastructure.
Just a question...

How is getting rid of the franchise fee going to help? That's passed on anyway, and is included in the cable companies' price point calculation, so if the FF went away tomorrow, prices would still be the same in short order. It happened to cable internet in the 2002/3 time frame.
RadioDoc
58ef2c0
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·AT&T Midwest

said by Karl Bode See Profile :

Over the cable industry's pipes but not via their TV delivery mechanism? There's some interesting dynamics to play out there....
That irony is not lost on me either. Unless the cablecos block ports of throttle certain kinds of traffic (oh, they would never do something like that!) they may be developing a little leak in their revenue boat.

On the one hand they're trying to take the PVR out of their customer's homes, while something like this is right around the corner waiting to occupy the same functional and physical space (without the $10/mo fee) plus add far more value.

On the other hand, they've invested so much in half-assed digital delivery they can't really back down now.

Then there is the short walk from cable to other delivery mechanisms for these multipurpose devices making cable's offerings irrelevant.

Interesting, indeed...
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See 11 replies to this post
ajschmitt

join:2005-11-30

Set Top Box Makers, not cable, are threatened

I think the point is being missed here.

Consoles are a direct threat to the incumbent makers of set top boxes - Scientific Atlanta (Cisco) and Moto. Take an Xbox 360, add cablecard, perhaps reduce the graphics capability and you have all the hardware required for a competitive set top box.

Consoles are serious long term threat to the cablecos because the broadband capability of these boxes provides an alternative path to deliver content, particularly IPTV and Netflix style business models.

»www.nyquistcapital.com/2006/01/1···60-iptv/
Brigrat

join:2003-09-01
Lovington, NM

Re: Set Top Box Makers, not cable, are threatened

You guys need to read the friggin article. The threat is not Games over direct TV, the threat is DVR, and TV ala carte via the XBox 360.

gheezer
Compooters R Us
Premium
join:2002-12-20
Henrietta, NY

Re: Set Top Box Makers, not cable, are threatened

said by Brigrat See Profile :

You guys need to read the friggin article. The threat is not Games over direct TV, the threat is DVR, and TV ala carte via the XBox 360.
Over who's infrastructure? A cable internet customer is still a cable internet customer...
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RadioDoc
58ef2c0
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join:2000-05-11

Re: Set Top Box Makers, not cable, are threatened

Except...that they can get the same content from a different provider. They are no longer trapped in a forced marriage with cable. ANY ISP will do, including DSL, WISP, even satellite.
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gheezer
Compooters R Us
Premium
join:2002-12-20
Henrietta, NY

Re: Set Top Box Makers, not cable, are threatened

Real time HiDef content over WISP or sattelite?

You can't be serious.

Even the most aggressive compression scheme still can't support trasnport this dense of a content over the air.
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RadioDoc
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Re: Set Top Box Makers, not cable, are threatened

said by gheezer See Profile :

Real time HiDef content over WISP or sattelite? You can't be serious.
Who said anything about real-time? It is entirely feasible to download and store HD video over a common Internet connection overnight for viewing the next day.
said by gheezer See Profile :

Even the most aggressive compression scheme still can't support trasnport this dense of a content over the air.
You might even want to check out the HD broadcast spec, which beats the snot out of anything cable is doing. It is very much "real time" and "over the air".
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crk2h

join:2003-03-19
Murfreesboro, TN
·ISDN-NET

I like my cable being bundled

I Dunno I am happy with my 200+ channels and when I can't find anything on there I just switch to ON demand from Comcast and I can always find something to watch. And I just use my Comcast DVR to record what I can't watch during the day. I think its all about simplicity for most Americans and thats why they choose cable. Also I know that downloading or streaming HD content over an internet connection would take forever to get a 30 minute show.Just trying to stream a 3 minute HD movie preview can be a pain in the a$$.. I don't think people realize how big rue HD content file are
Forums » Game Consoles Vs. the Cable Box


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