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Internet TV

© January 2006 Anthony Lawrence

The FCC will apparently advocate a la carte TV pricing and Google may be about to announce some sort of internet appliance.

It's plain that TV as we know it isn't going to last. Nobody likes the cable bundles (buy 30 channels you don't care about to get the one you do). Although a la carte channels are an improvement, nobody is going to like that either: what people really want is a la carte content, period. That may be what Google is planning to provide, and if they don't someone else (Microsoft?) surely will. The only real question is will this new media be subscription based or peppered with ads? Actually, there's no question there: both models will be used; it's just a matter of how much we're willing to pay and how many ads we'll put up with.

But we have people worried that this is harmful. The News.com article referenced above notes:

But cable TV companies have argued that pricing individual
channels would result in fewer choices for all consumers. They
believe that a la carte pricing would make it too expensive
to offer less-popular channels that presently are bundled with
popular channels.

I think that ignores the changing economics of production. All media content is becoming less expensive to produce. It also ignores the changing cost of distribution, which also is rapidly approaching zero.

This is all driven by the Internet, of course. We already have some TV shows transitioning to the Internet, and I have little doubt that more will follow. Just as blogging is damaging traditional newspapers, traditional TV will also diminish in importance. That may take longer, but it is going to happen.

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Fri Jan 6 23:17:40 2006: 1482   dhart

Ya, well, there's still nothing on.

Sun Jan 8 11:17:24 2006: 1485   drag

Currently there is a per channel licensing sceme that you can use...

This is when you buy a 'big dish' satellite to pull your TV directly from the big analog satalites before cable and digital subscriber satellite 'content providers' grab the information and compress it into mpeg2 streams for 'digital tv'.

This is perfectly legal and you don't have to pay jack for it. It's completely free, but the cost of the satellite equipment and the fact that you have to have this 7 foot 'redneck-style' dish will put most people off from this.

Now you only get 200 or so channels free, mostly for non-commercial use, many of them are only on during certain parts of the day. Obviously if your going to resell the channel content to other people, like if your a cable tv provider, you have to pay to use the feeds.

Note that I am talking about C-band and Ku-band satellite. These are the same feeds that cable people use to generate their content.. Don't get this confused with the small dish 'digital tv' providers that take the big analog satellite feeds and compress them to mpeg2 streams.

Many 'premium content' channels, like say 'the history channel' or HBO are going to encrypt their feeds so that regular folk like you or I can't just watch it without paying for it. So in order to watch it you'd have to buy a descrabler box and pay a monthly fee to HBO or whatever to get access to the movies or whatnot...

Now this is what scares cable tv folks.... In order to pay for the channels that you want using the old fasion big dish tv stuff you have to do monthly subscriptions directly with the channel makers, this literally costs pennies on the dollar compared to if you have to buy from a cable company.

For example say your a movie junkie. (pulling this information from a quick google) A subscription of 23 channels directly from HBO and Cinemax for a year costs around a 200 dollars. This would include a couple HDTV channels (still analog). To get _close_ to the same thing using cable TV would probably cost around 800-1200 dollars a year. Probably more.

For most channels, like Discovery/TLC stuff, it's around a dollar to 5 dollars a month.

And not only that getting the feeds direclty yourself has a much higher quality because it hasn't been compressed/squished to fit efficiently down through the cable company's redelivery infrastructure.

Then you get access to fun stuff like 'wild feeds'. Like big sports events will use a cband channel for just when they need to rebroadcast raw feeds to various network channels that edit it and redistribute it to you over the air. You can pick up on these feeds and watch them yourself and such. Not that I understand all the details or whatnot mind you, this is just from what I've read.

Now for most people the upfront costs and the nuiscense of maintaining/purchasing the equipment themselves is more then enough to cause them to ignore services like this, but if you could do something similar with good quality over the internet it can potentionally put a entire industry of repackaging and rebranding tv content out of business in the US.

Now I don't know if people will do it on a per-show basis though. I suppose if it were possible for some shows it definately would be worthwhile.. It would be the internet equivelent of "Pay Per View" and would work out for high profile events and shows. This stuff is already highly successfull.

For most shows I would expect that it would become the equivelent of 'blogs' (which is a irritating term) were you would subscribe to different sites on the internet to get a certain theme.. Like Discovery/TLCfor 'educational-style content" or Showtime or PBS.

Sun Jan 8 11:30:34 2006: 1486   TonyLawrence

I expect that the Cable Companies and others are going to see the opportunity to deliver via internet and should price it to reflect the reduced cost.

Of course the cost for cable companies is the cables, but if they are providing isp service, they'd need to shift their costs to that.. right now I would guess that they subsidize that from the cable tv revenues.

Possibly the content providers (HBO, Cinemax) might go to direct internet delivery, which would put the cable companies back where they started (backwoods and behind mountains).

All very confusing :-)


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