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Will Cable's 'TV Everywhere' Be A Big Pile Of Fail?
Yes, if cable insists on forcing square pegs into round holes...
by Karl Bode 09:39AM Wednesday Mar 24 2010
We've frequently discussed how the TV industry (both phone and cable) is collectively working on an online video service that takes some existing content and puts it behind a paywall -- accessible only to users who have cable service. The idea has long been that this will stop users from cutting the cord and moving to competing Internet-based services, though there's been some bickering with broadcasters over compensation, and the idea seems to be a jumble of non-standards from one operator to the next. Comcast is so far the first to launch their TV Everywhere effort, and opinions are mixed.

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Techdirt directs our attention to a piece over at MediaShift, where author Mark Glaser argues that TV Everywhere is going to fail, and it's going to have nothing to do with broadcaster disputes, clunky GUIs, or inconsistent standards. It's going to have everything to do with the fact that the cable industry believes they can take their old business model, and violently force it upon the new broadband-driven Internet:
quote:
The cable companies have no plan to give people the option to access Xfinity or other TV Everywhere services for a fee instead of forcing them to pay for cable TV. That means this is not a strategy for working out an online business model (either through advertising or paid content, or a mix of those or something new). Instead, the cable companies have one aim: Protect the old business model. Again, this is not a strategy born from innovation or smart thinking about new platforms. This is survival mode and all about protecting the old, broken way of doing business.
If you talk to cable industry executives right now, most of them are almost glibly confident that cord cutters are a very small niche segment, and not something to worry about. And for now, they're right. Cable's incredibly-robust infrastructure is in place, works great (usually), and even during a recession and despite endless rate hikes -- consumers continue to throw money at the industry for hundreds of channels most users never watch. But if you've watched the evolution of broadband and Internet content, you know that despite what Mark Cuban wants to believe, Internet video is a very real threat.

Right now, slow last-mile speeds, terrified Hollywood studios, and clunky first-generation home video solutions are keeping Internet video out of the mainstream. But it's only a matter of time before speeds increase, cheaper and simpler home broadband video services appeal to the cost-conscious, and consumers gladly begin fleeing a sector that has pounded consumers with an endless stream of rate hikes, forced them to buy bundles of channels they simply do not watch, and continues to have some of the worst consumer satisfaction scores across any industry (even the IRS).

Traditional cable will still dominate for much of the next decade; this is going to be a slow (r)evolution. But the industry does have one hell of a fight coming down the pike. While some cable insiders work a little too hard trying to convince you of cable's infallibility, the insightful insiders know things will be getting rocky. That's why just like wireless carriers, who fear the impact mobile VoIP and push IM have on voice and SMS revenues, the cable industry dreams of a broadband future where you're paying one hell of a premium for every gigabyte delivered -- so if you do someday switch to Internet video -- they'll still get their pound of flesh.


105 comments .. click to read

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backness

join:2005-07-08
K2P OW2

2 recommendations

reply to Rick

Re: Sorry Karl but...

Rick,

You posted only an hour ago and the price is already going up!


MPScan
Premium
join:2001-08-24
Boston, MA

1 edit

2 recommendations

reply to Rick
"Value" -- according to who? The cable company? The consumer?

No, see, you don't decide what is value to me... I decide what is value to me.

You're funny.
--
Organized religion is for those who need it because they don't have enough faith in themselves.


Rick
Premium,MVM
join:2001-02-06
Waterbury, CT

3 recommendations

I've just seemed to miss the part about this supposedly "endless" stream of rate hikes that cable providers have thrown at customers.

In my view..it's gotten less expensive..and consumers have gotten a lot more for their money the last decade.

We've both been around this site almost an equal amount of time.
Remember those top level 768k tiers back then..for 42.95?
Well, now it's 12Mb and 20 Mb with powerboost..for the same exact money. Where's the increases there..the inflation?
There hasn't been any. It's been all about consumers instead getting a lot more either for less..or for the same amount of money.

And bundle pricing..what about that? Cable companies like comcast have slashed customers phone bills to practically nothing as part of bundle pricing. For 3 to 5.00 dollars a day people now get virtually unlimited internet access..all the phone they can dial across the country..and tv packages consisting of virtually everything including all the premium channels.

What else do we get for that kind of money in our daily lives...
a coffee and donut at Starbucks maybe? A pack of cigarettes perhaps? A loaf of bread and quart of milk if you're lucky?

These providers are not expensive. There is real value here that's really unheard of I think in todays world when people look at all there is and are receiving.

I think that internet video will always be a factor..but I'm not as convinced about it being the threat that some see it as.
The internet is so wide ranging and diverse and yes..you can find just about anything but often times you're just out there searching all over for it. Video quality sometimes can be lacking and there's really nothing that cohesive about it all.

Cable and phone company packages even tend to bundle it in such a way that it all comes together better I think in such a way that real value is again created for what people are looking for. I just used xfinity tv myself the other day to access my HBO package online and I thought it was great. Amazing even.
The quality was there and really..so much easier and more functional than trying to look all around the net for some downloaded program from some pirate website that everyone worries about getting caught stealing from anyway.

These companies are offering real value these days in their bundles. And quality..and I think..at very reasonable prices.

That's why I think they're succeeding the way they are today.
And why it will only continue for many years to come.

~Rick