TV Everywhere: Frightening & Enlightening
9:35 AM --
For the first time in broadband history, two major cable parties, MSO Comcast Corp. (Nasdaq: CMCSA, CMCSK) and media giant Time Warner Inc. (NYSE: TWX) (which recently spun off its cable system operations), have teamed together to feed their version of a Hulu-like Web video service to a lucky and anticipatory 5,000 test customers. (See 'TV Everywhere' Race Heats Up, Time Warner, Comcast Team Up for TV Everywhere, and TW, Comcast Cast 'TV Everywhere' Principles .)
This is not breaking news, but it does bear a closer look at the ramifications, both good and bad, for the future of programmers, pipeline providers, and consumers alike. Fear can be a great motivator, although who wants to be pushed to be creative at the point of losing something as important as your business model? But that is what seems to be taking place with the "TV Everywhere" initiative -- and what a motivator it has turned out to be.
Just gaze at the networks on which this model has taken hold, with participation from dozens of programmers, including Home Box Office Inc. (HBO) , Starz Entertainment LLC , Discovery, A&E, BBC America, Food Network, WE TV, E!, and Sundance Channel, just to name a few.
Recent history shows that the music industry failed to see that consumers were downloading music illegally to their iPods, or that they were perfectly willing to pay for that entertainment, as is common now -- and that earlier lack of vision now serves as a great motivator for the likes of Comcast and Time Warner.
The cable industry is now in the driver's seat if TV Everywhere becomes a success, both with "authentication" and with the notion that consumers will accept the premise that they can obtain content in standard-def and hi-def over a high-speed connection as part of their regular cable TV subscriptions.
This could change the way programmers are currently being paid for their content -- which is in a linear format (and sometimes complemented through video-on-demand on the regular hybrid/fiber coax network) and continues to be consumer unfriendly -- and has driven them to give the direct-to-consumer Hulu model a shot. But consumers are wary of possibly having to pay additional usage fees for that access. While content online has mostly been free (ad-supported) to this point, all that may change if TV Everywhere is the success its conceivers envision. It will be interesting to see how this new paradigm continues to evolve and who takes advantage to become the dominant player as consumer preferences continue to shift. — Leonard Grace, a cable industry vet, is a telecom strategist and blogger. He can be reached at [email protected]. Special to Cable Digital News
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