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The Economist On Television Over Broadband
zxjio recommends a pair of articles in The Economist discussing television over broadband, and the effects of DVR use. "Cable-television companies make money by selling packages of channels. The average American household pays $700 a year for over 100 channels of cable television but watches no more than 15. Most would welcome the chance to buy only those channels they want to watch, rather than pay for expensive packages of programming they are largely not interested in. They would prefer greater variety, too — something the internet offers in abundance. A surprising amount of video is available free from websites like Hulu and YouTube, or for a modest fee from iTunes, Netflix Watch Instantly and Amazon Video on Demand. ... Consumers' new-found freedom to choose has struck fear into the hearts of the cable companies. They have been trying to slow internet televisions steady march into the living room by rolling out DOCSIS 3 at a snails pace and then stinging customers for its services. Another favorite trick has been to cap the amount of data that can be downloaded, or to charge extortionately by the megabyte. Yet the measures to suffocate internet television being taken by the cable companies may already be too late. A torrent of innovative start-ups, not seen since the dot-com mania of a decade ago, is flooding the market with technology for supplying internet television to the living room." And from the second article on DVR usage patterns: "Families with DVRs seem to spend 15-20% of their viewing time watching pre-recorded shows, and skip only about half of all advertisements. This means only about 5% of television is time-shifted and less than 3% of all advertisements are skipped. Mitigating that loss, people with DVRs watch more television. ... Early adopters of DVRs used them a lot — not surprisingly, since they paid so much for them. Later adopters use them much less (about two-thirds less, according to a recent study)."
My television viewing is probably about 99% on DVR and I skip all commercials religiously, although if I see an image that intrigues me I will stop and rewind.
Cable television is dead in the water. Now we have to wrestle control of the network pipes from them, or at the very least have public network infrastructure installed (fibre to home anyone?). Socialism is good.
Salut,
Jacques
In due time, we are going to have to pay ourselves up-front for the big budget entertainment, rather than indirectly as a cost built into the products we buy, because they got advertised as a subsidy on our media.
Nah, the ads will just move into the movies in a bigger way. Along with NOS, Autometer, Nissan, Ford and Subaru... I wonder how much Castrol paid to get in to Fast & Furious this time? Even my non-car-geek friend picked up on that advertising. Or the ads become feature length movies... either way really.
Forget thrust, drag, lift and weight. Airplanes fly because of money.
Mythbuntu allowed me dodge the expensive DVR and accorded me the freedom to skip commercials from recorded programs. My Mythbuntu, connected to a wireless router, quietly runs in the basement and through a netbook connected to an LCD TV, I watch these shows. Sweet.
I just hope that folks at Mythbuntu can integrate the script that removes commercials. Right now, you must be a semi geek to set this up. The other problem too is the trouble with remote controls. It appears that there is no way of getting a remote control configured without editing some text file. This can be scary with the enormous number of options. Even with this, you will be lucky to have it working.
My experience has been rewarding. To save on power bills, I would like to use a notebook based TV card if I can find one.
For those who might be wondering whether Mythbuntu 9.04 has solved anything, I can say not much over here though boot time is faster with 9.04 as compared to 8.10.
My next task will be to grab free "Free To Air" signals in my area. I understand there are many channels around. This means folks, that I am not very happy with my cable TV company.
The real question is, what will the "real cost" when our current model of subsidizing unpopular channels under the guise of bundling them up with more popular ones, is replaced with an ala carte model.
No one, with realistic expectations, expects this to be free.
I haven't had cable television in 7 years. I don't miss it. For the money I save, I
* Netflix
* Go to the movies
* Pay for the newspaper
* Pay the late fees on my library books
* Pay admission to museums
At the end of the day, cable isn't offering us anything we can't see already on Netflix or on youtube or hulu et al. So really -- why pay $700/yr or whatever when we can watch all the programming that we really like by pulling it instead of waiting for it to be pushed?
P.S. Take a Kill-A-Watt and check out how much electricity your cable box + DVR + ??? are using on standby and calculate the additional burden on your electric bill. I'd bet it's a combined 40W or so, good for another $50+ a year.
Support a few technologists in Washington.
Most would welcome the chance to buy only those channels they want to watch, rather than pay for expensive packages of programming they are largely not interested in.
I'm sure they would, but the economics of television channels doesn't work like that.
Let's suppose person A is willing to pay $5 a month for the sport channel and $10 per month on the news channel. Person B is willing to spend $10 a month on the sport channel and $5 a month on the news channel. If the package of 2 channels costs $15 they'll both be willing to pay for the channels. If the cable provider charges $7.50 for each, then each subscriber only pay for one channel since the other one is not worth the amount they're charging to that customer. So, the cable provider has lost out on $15, and each subscriber has lost out on a channel that they're reasonably interested in.
It's not like other purchases. The cable provider doesn't have to buy a selection of channels and resell them. They pay a fixed fee to the station, based on the expected number of subscribers, and price their offering so as to maximise their profits.
Internet based TV services aren't going to change this offering. They'll still offer a selection of "channels". You'll still end up with a package of programmes, most of which you don't want to watch.
I lost a lucrative job in late 2001. The first thing I cut off was the satellite tv. I learned to test DTV until the p-4 switch and have since relied on OTA and various forms of TV over DSL, especially justin.tv. My kid doesn't care or doesn't realize that we only have 2 channels on our tv.
I've got 101 mod points and you can't have them!
True, the combination of Netflix, Netflix, and online news can replace films, scripted TV series, and news on cable TV. But what replaces live sports on cable TV?
Why not free? The broadcast channels are already free using an antenna and I'm assuming that those are even the most watched ones. Why shouldn't it be possible to get Comedy Central, Discovery Channel free by showing ads like FOX, NBC, etc. ?
There are also some countries where only free exists with the exception of HBO like channels.
I'm already getting almost everything free that I watch (or everything after dropping cable). I get the broadcast channels and with hulu I also get the things that I watch on comedy central. The only channel really missing is Discovery channel and I can live without it. (not worth the $50 cable bill for one channel)
Torrent was EXACTLY the word I was looking for. Thank you, The Economist!
If you think that happened by accident, you don't read The Economist regularly. That's exactly the sort of dry wit their writers use.
Some years ago, The Simpsons had Homer traveling by air in first class, and he says "Look at me, I'm reading The Economist. Did you know Indonesia is at a crossroads?" The Economist published an article titled "Indonesia at a Crossroads" that week.
It's not the cable companies that are selling packages of channels, it's the content producers - cable companies don't much care beyond the technical details of access control and so forth.
Everyone thinks they want a la carte programming, but the reality is that if it ever came to pass, most folks would pay pretty much what they pay now, except they'd get fewer channels in exchange, particularly for those who are interested in niche or specialty channels. Without the producers being able to subsidize niche channels through fees for their popular, flagship channels - which is, of course, exactly why they sell channels in packages like they do now - the price of those niche channels will go up dramatically for those who choose to subscribe to them. Not a problem if you're only interested in ESPN 1 and MTV 1, but if your tastes are even slightly outside the mainstream, you won't wind up saving much money at all.
ABSURDITY, n.: A statement or belief manifestly inconsistent with one's own opinion.
But is the rest of the world paying $700 yearly for television? I only pay 9.50 EUR/month for the basic subscription (26 channels). Throw in the FTA channels, about 15 interesting enough and I still don't watch more then 15 of them.
The max. subscription price is 53 EUR/month (for about 65 channels), but I can't imagine anyone willing to pay that amount when you have the ability to (illegally) download most of it for your own convenience.
I canceled DirecTV a month ago. I get my tv through eztv.it and Torrent Episode Downloader (TED). I have two XBOX's (original, not 360) that I've loaded XBMC onto. I get movies through thepiratebay and Netflix. I don't have the fastest internet speed in the world, just 1.5mb, but it seems to work just fine for everything I want to do.
Before I got rid of Dtv, I had paired it with ReplayTV, which we loved. We watched a reasonable mix of live and recorded tv. I might still be with Dtv and replaytv if replaytv had been allowed to continue to innovate and hadn't been litigated out of existence. I just couldn't stand the picture anymore from the replay on the new tv, couldn't bring myself to getting dtv's comparatively crippled dvr, and building two dvr's using Mythtv or whatever was just too expensive and too much trouble.
I'd like to point out something I've observed over the years I've used my DVR: I watch the commercials.
I'll be watching my show, and I'll be using the 30-second skip feature to skip commercials during the show... but in the act of flipping through the commercials, If I see something that looks interesting to me, I'll actually go back and see what the commercial is about.
Reasons I skip commercials include: The commercial is annoying, I've seen it several times, or I am defiantly not the target audience.
I've also experienced where I am watching with somebody else, I skip a commercial, and the other party asks to go back to see it because they were interested in it.
I'm sure I'm not alone in this observation. So, I think all commercials get a fair showing in most cases with DVR.
So what will happen? I think content providers will partner with cable cos to provide their content online.
That might bite the cable companies in the ass. Certain content providers are waiting eagerly for them to open the doors on such negotiations. That'll make cable dumber than a dumb pipe.
Second, they are waiting for the end of analog signals so they can reclaim some bandwidth.
Huh? Cable bandwidth is unrelated to the OTA switch to digital signals. Some cable companies will continue their analog basic cable services long past the switchover date. Others have already abandoned analog, requiring their customers to use a digital set top box, with whatever DOCSIS version or other protocol they deem appropriate (FiOS for example).
Have gnu, will travel.
Ironically, the Economist misses an important piece of the puzzle. It writes:
The 1999 CES awarded the "Best of Show" video category to ReplayTV, with Tivo as the runner up.
ReplayTV was the DVR to own during the analog era. It offered built-in autoconfiguring ethernet, automatic user-oblivious commercial skip (using detection heuristics similar to those now employed by MythTV) and the ability to exchange show recordings over the internet. The last two features were potentially massively disruptive to the TV/movie industry and landed the ReplayTV people in court. The protracted legal battles drained the company's finances and attention, and in the end they consented to remove the coolest features from their newer units. By then Tivo, which always played well the media conglomerates, had taken most of the market by offering units with significantly less disruptive potential.
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