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)."

Comments

Re:I guess I'm at the far extreme

[morgan_greywolf]

Yep. I remember that provision. And apparently so does Robert X. Cringely. I remember thinking back then that by now we'd have 45 mbps, which was practically unheard of back then. Most of the country was on dialup, and there were a few folks on cablemodems.

So where did the $200 billion go? Read Cringely.

Re:I guess I'm at the far extreme

[Doug Neal]

You already have socialism: it is government that grants these companies their exclusive monopolies. Why do you think that a bigger, more intrusive monopoly will lead to improvement? Take the monopoly away, don't strengthen it.

That's not socialism, though.

The important difference between a publicly-run network and a privately-run network is that the public network is not run with the intention of generating maximum profits for the shareholders, but rather for the public good. Financially speaking, it's fine if it breaks even. Fast fibre connections into every home would also have many secondary economic benefits to the community that are harder to quantify than a company's balance sheet. Yes it's technically a monopoly, but many of the reasons for a monopoly being a bad thing no longer exist. There would also be nothing to stop telcos from building their own private networks alongside the public one. Given the choice between a public monopoly and a private one, I'd rather have the public one every time.

I would possibly like to see such a public network run as a wholesale service whereby the service providers buy capacity and resell it with their own packages. This would completely level out the playing field and make true market competition possible. This is evident in the way that the incumbent telcos are trying to get bills passed to prevent this from happening; they are scared shitless by the possibility that the power they have to completely rape their customers for as much money as possible for as shoddy service as they can get away with, would be neutralised.

Re:I guess I'm at the far extreme

[wealthychef]

I usually think that when the government starts merging with industry, it's called Fascism, which is more an attribute of the right than left, but both parties are moving that direction. Usually the government nationalizes corporations, but if the government is run by the corporations, it will end up being the same thing... the single party bit is true in all but name now -- neither party resists the corporatism.