Is TV About To Be Gone with the Web?
April 14, 2010 18 Comments
by Elias Shams
If not gone, they will have at least web connectivity in a few years.
An estimated 800,000 U.S. households ditched their cable, satellite or telco TV subscription services for online options such as Hulu, Netflix, broadcaster Websites, or Apple’s iTunes last year. The number could double to 1.6 million by the end of 2011, according to a new study by Convergence Consulting Group.
I can totally see how this number will be jacking up as more and more viewing options become available online – things like hulu or tablets. Not to mention our experience of dealing with less advertising watching movies or TV shows online compare to TV. I wonder how long that lasts.
The U.S. counts an estimated 101 million pay-TV subscribers, making for an $84 billion industry.
The report found that 17% of the weekly TV audience watches at least one or two episodes of TV shows online, up from 12% last year; that figure is expected to rise to 21% next year.
Convergence noted that consumers who have ditched their pay-TV subscriptions still represent less than 3% of total online TV viewing.
The firm’s report also estimated that just 100 million TV episodes were purchased and downloaded from online retailers in the U.S. in 2009, generating revenues of $200 million; this is up from 90 million downloads in 2008.
Not sure how worried the cable companies are about this. This is an inevitable phenomenon. I hope they are the believer of the cloud computing. Because that is the only technology I see they can utilize to sustain their incoming revenue, even more.
I also view this change as a similar meme related to people without a home phone connection using the cell phone as a primary device. That was 10 years ago and today there is still a large base on consumers migrating to no land line connections. But it’s really just a shift of revenue for the carriers who actually have found a way to extract more revenue per sub under the mobile bill than they could have on the land line bill. At the end of the day, we’re still paying AT&T and Verizon, Sprint bills each month.
On this front, the cable and Telco’s have the same situation and they are already moving their chess pieces into place with bandwidth caps and walled gardens. Think it’s any surprise why Comcast is buying content? They don’t care and are building a similar strategy so that rather than extracting $120 per household they will be able to extract even more or slightly less per subscriber.
So whoever is the 800,002nd person on the list, ask yourself this question: where are you getting your access. Most likely it is a cable co, Telco or wireless provider. Net Neutrality is the big question and the network operators just won a major strategic move in “neutering” the FCCs planned regulation on it.
The biggest threat to the network operators is Google who is looking to cram down fiber in hopes of end-arounding the network providers. The best bet for the consumer would be for the US government to partner with Google to force / push this initiative but the network incumbents have incredible power in Washington.
But the trend here is starting and if you watch closely enough you’ll see the small and subtle strategic moves being made in this war with billions on the line.
About Elias Shams
Elias Shams
Kamran Abdi
Tatiana Sorabi
It should all come down to one hologrammatic screen sometime . . . who knows when:)
I guess Apple is doing that already
of course, so are cars and airplanes.
we don’t need any of that
we can all live in communes
What’s TV?
I have been watching everything over the Net since about 2006.
K, Peter, Thanks for the input. What is your thought on connection between iPad and Obesity I pointed out here too?
http://awesomedc.com/2010/04/08/thanks-to-ipad-brace-yourself-for-obesity-3-0/
I just want to make sure it is not only me thinking this way. Cheers
It’s done from the technological view
Steganography comes to mind. Im not up on all the technology driving TV today, but I would imagine it would broaden up if it moves primarily onto an internet base. You’ll end up with services that perform the function of TV, but you’ll have just as many free (be it via a business model or illegally) that have the potential to hide substancial information in a multimedia feed.
Using software to encode in a program into an episode of House to send over, effectively a very confidential FTP, to which they decode– would become possible because of the sheer size of pushing a standard episode down.
How would you detect that? Mitigate it?
No, It would be the vital home Audio Video Window to the Information and Entertainment, rather it would be more center staged for the acivities including Video Conferencing interface.
By TV if you mean the television set that you that people traditionally crowd around to watch programmes and events. In our multi-screen environment the way in which devices we choose to receive video will vary according to our needs.
If you’re a baseball, football or basketball fan would you choose to watch the game on a mobile phone, iPad or 60 inch plasma/LCD in 5.1 surround.
Whether or not telco’s or content creators can shift viewers to a paid subscription service and receive it in anyway the consumer chooses.
Media of all descriptions are in a flux about how to survive with the web. Books, magazines, newspapers and tv have all been toppled as prime sources for many things, and they are struggling to keep our attention. In years past everyone sat around the radio to listen to news and music then along came television – but radio didn’t totally die and with the internet that is getting a new life. Major city newspapers are dying, but smaller niche newspapers for are thriving. So yes, I think tv will survive on the web, but it cannot be a one-size fits all that it currently is.
I think the transition will be ineresting though!
When web news content came rolling in newspapers were on the firing line….The sales of the print has been going up ever since…
Different markets, different products however similar synergies !
Newspapers are dying here in North America.
Peter
Not all newspapers in the US are dyiing. We have two niche newspapers here in town that are new but both seem to be serving a need for news in town. When no one bothers to go to town meetings, school board meetings etc etc, they don’t get to know what is going on until it is too late, unless a local news source delivers it. The Atlanta area is perhaps unique but the papers started by being delivered in the mail (one dropped out), and there are numerous free magazines that are purely ad-driven.
So I disagree that newspapers are dying – the big city ones, as i mentioned, are on life support, but the gap is being filled with smaller, more relevant town newspapers/magazines.
I don’t think that the TV’s will be gone with the web completely. May be the mechanism of broadcasting of channels change to internet as a major source. We have TV/Channels/Programs on demand. Basic hardware component will definitely remain the same or upgrade to 3D.
Web is future, but we should not compare or say that TV is gone to be web. It’s logically incorrect to compare two totally different things, one being a hardware component and other being a communication medium.
i say YES and NO because a TV will be integrated with computer…or TV in other words will be a computer….and it will operate over wireless internet connection and have access to purely online based content….no more over the air transmissions should the FCC take away the spectrum from broadcasters (as it rightfully should)
I would not say that TV will be gone. It will be changed by the web and the web will be changed by it, and the same goes for the telephone. Pretty soon, it will all merge into one fiber-optic connection and wifi for roaming devices. I am already sitting here at a laptop with my business phone plugged into the USB port, and, if I wanted to, I could be watching Law and Order or using Skype for a video call. I use Google Voice, both on my computers and on my cell.
I don’t think that people are going to want to give up watching shows, reading novels, talking to each other, getting the news or using the web. We will undoubtedly have new appliances that merge a lot of these activities and they will all be using the same network. And interactivity will expand into new areas. We are all going to have to struggle to keep up with the new possibilities. Good luck with that. Just thinking about the pace of technological change these days makes this aging baby boomer feel even older.
You are right. I wonder how much of their advertising revenue will be effected by this though
Well, I would say that the current economic models of both television and telephone companies are seriously at risk. I have to laugh when I see a commercial for telephone service offering “reduced rates”. My business line costs me a little more than 60 bucks a year for a call-in number in my area code and unlimited calls to the US and Canada. I can also use it to set up conference calls and no one ever notices that I am actually using Skype. I also think that the production companies are going to see the new possibilities for selling their content and the big guys will no longer have power. It is ultimately bound to have the same kind of effect on their economic models that we have seen in the print-and-paper publication industries. To put it bluntly, adapt or die.