Cable Channels Panic Over iPad Streaming App

jfruhlinger writes "Time Warner Cable this month released an iPad app that would allow its subscribers to stream (some of) the channels they already pay for to their iPad, so long as they're connected to home Internet service provided by Time Warner Cable. The app probably seems like a baby step to most Slashdotters, and was extremely popular among subscribers — but it's thrown the owners of those channels into a panic, and they're threatening lawsuits. Time Warner says the contracts they've signed with the channels allow broadcast to any device in the home — 'I don't know what a TV is anymore,' says one company exec — but the channel owners fear that this will disrupt current and future revenue streams and that they need to stop it now. 'If we allow this without litigation, everyone will do it tomorrow,' says an anonymous source. 'If we litigate, we have a chance to win.'"

Comments

"If we litigate, we have a chance to win.'"

[mehrotra.akash]

"If we litigate, we have a chance to win."

Is that really the lines a business should be thinking on to advance and expand business??

Re:"If we litigate, we have a chance to win.'"

[cultiv8]

"If we litigate, we have a chance to win."

Is that really the lines a business should be thinking on to advance and expand business??

Yes, if your business model is dying.

Re:"If we litigate, we have a chance to win.'"

[Anonymous Coward]

What, exactly, are they winning? Less viewers???

Re:"If we litigate, we have a chance to win.'"

[elrous0]

If you can't innovate, litigate.

Re:"If we litigate, we have a chance to win.'"

[count0]

>What, exactly, are they winning? Less viewers???

If they win they get more viewers and more money.

MORE VIEWERS
That's one of the points of TFA - Nielsen screws shows that allow streaming. By the measures that matter to them, they will actually win *more* viewers, because streaming isn't counted by Nielsen. Since tablet streaming cannibalizes views on a traditional TV, their Nielsen ratings will get worse if their show is a runaway success with ipad streaming households. Which sounds like they should be suing / working with Nielsen rather than the cableco.

MORE MONEY
It's not just about ratings, it's about revenue. Shareholders& the execs that answer to them demand growth, and here's a potential new source. They're hungry and implacable and not very thoughtful--something like zombies, or brain-sucked minions of Cthulu. The fact that a cable subscriber can already sit down, turn on the TV and watch the exact same paid-for content that TimesWarner now lets them stream in their house doesn't matter one bit to the crowd of shambling shareholders marching towards media innovation, drooling and murmuring "Grroowwwwth. Growwwwtthttthhhhh".

Re:"If we litigate, we have a chance to win.'"

[ajs]

My real problem with taking this stance is that they've pre-determined that constraining the distribution of their content is defined as, "winning." Of course, we know from the history of every type of media to touch the Net that this is absurd. The services that win (though it might take a decade or more) are those that are least constrained. The only problem is that of determining how to monetize that process.

I do feel for the networks, though. They are trapped. If the TV model dies and is replaced by the model where every device has equal access to ubiquitous data, they're screwed. There is absolutely no way that they will be able to maintain the kind of revenues that they've enjoyed on the initial distribution, which means that they need to rely on the secondary distribution to make up the difference.

It's a hard thing to be in a nearly century-old market that suddenly undergoes such a tectonic shift, and I'm certain that several companies that are pillars of the entertainment business today will be gone in 20 years as a result. We just need to remember that that's their problem, and not one that we should allow them to force the federal government into trying to resolve for them.

Re:"If we litigate, we have a chance to win.'"

[donny77]

But the Time Warner streams are not on demand, they are Live feed of the broadcast. Plus you have to subscribe to the channel on Time Warner to get the channel on the app. You also currently have to be streaming across a Time Warner cable modem for it to work. The viewership data would be easier to acquire than a traditional TV. Its a win, win, win and win!

Re:"If we litigate, we have a chance to win.'"

[eriks]

... streaming isn't counted by Nielsen

Then Nielsen is fucking stupid, and by extension so are the execs for the channels that are accepting what Neilsen says. Streaming views should be easier to collect and be more accurate than doing statistics on a sample and estimating how many viewers there were.

Re:"If we litigate, we have a chance to win.'"

[93 Escort Wagon]

That's one of the points of TFA...

As soon as you admitted to reading the article, I stopped reading your comment. I have my standards.

Re:"If we litigate, we have a chance to win.'"

[FictionPimp]

Exactly, when I stream a show I'm actively choosing to watch that show. Which is different then when nothing good is on and I just set it to G4 and let cops run to fill the background with noise.

Re:"If we litigate, we have a chance to win.'"

[pixelpusher220]

I see positives here. Currently mobile phone providers require extra money to be able to 'tether' your laptop through your phone - when the phone does this on it's own if they didn't disable it. I pay for data access. How I use that access should be unimportant to the data provider. I consume the same data whether on an iPhone or on my computer.

Comcast is basically claiming the same thing. They pay for the channels and if they want to allow their users (who already receive those channels) to access them via another device - it's up to them what they want to do with that 'data' that they receive from the channels.

Nice to see a greedy corporation be stuck in the same bind us little people are. Now maybe we'll get some legal standing that using data you have properly paid to access is valid no matter how you use it.

Re:"If we litigate, we have a chance to win.'"

[nurb432]

That it was their first thought is why America is financially doomed.

Re:"If we litigate, we have a chance to win.'"

[BoberFett]

So what you're saying is that if my wife is watching a show on the TV while I watch a show on the iPad, that there are no shows left for my neighbor to watch?

You've really bought into this whole information scarcity thing, huh?

Re:"If we litigate, we have a chance to win.'"

[thegarbz]

It's more like you paid $7 for a plate at an all you can eat buffet.

Err no it's more like I paid $7 for a meal of a fixed size and took it home. Now I get to decide how I want to consume this meal, be it eat it, blend it and drink it, or burn it and snort the ashes. The provider provided a fixed meal for the cost of $7. I can do with it what I want.

Is this such a hard concept to understand? I have 1.5GB on my phone. 1.5GB whether I tether, or just use Google maps. I pay for 1.5GB / month and it should be of no interest to the provider if I am using it to download pictures of lolcats or downloading the latest movies.

Same thing here. We have a cable company who is providing an internet service as well, who has licensed the channels to be re-transmitted to the customer's home offering the customer on which device in his home he can view said content. What is wrong with this? I used to watch cable TV via a TV tuner in my computer. How is the iPad any different? Just because the data comes over IP? It still comes from the same provider down the same copper line to the same house.

Re:"If we litigate, we have a chance to win.'"

[twisted_pare]

No one has yet mentioned why the channels are scared. They have every right to be, it is based on oversubscription. (1) If you are a cable channel, you charge a few cents per viewer, per month to the cable company. This is not much for most channels, between around $0.15 and $1. For a major channel like ESPN it can be $3.50. (2) Most people don't care about most of the channels in their package. Of that $80/mo, I don't care about the $0.15 that is going to Women's Entertainment, but they still get their cut. WE depends on million of people that don't watch the channel paying for it. Many channels desperately need this model. (3) If you stream channels, then you could just stream what you want. Heck, the big boy marquee channels like ESPN could just charge people directly and cut out the cable co. For instance, why pay $80 for those channels when you could just buy it from ESPN for $15/mo directly. This is great for ESPN, but bad for the Classic Golf Channel. So you see, if you are many of these non-marquee networks, you will hate this new model because it empowers the consumer to get exactly what they want, making the popular channels more prosperous, and killing off those who depend on oversubscription to users that don't even want them. That is what this is really about.

My thought is...

[mace9984]

" but the channel owners fear that this will disrupt current and future revenue streams and that they need to stop it now." No, me not watching your shows because they aren't in the format I wish will "disrupt your current and future revenue streams" though.

Re:My thought is...

[Conspiracy_Of_Doves]

Although the more likely scenario is "me not watching your shows because they suck".

Re:My thought is...

[iluvcapra]

This lawsuit has nothing to do with you or your formats. It's strictly a business deal between content producers and a cable distributor; the content producers think Time Warner is welching on their deal to distribute the data according to their contract. What if a cable channel wants to stream their channel themselves for direct subscription revenues? TWCs action makes it less likely this would work, and it looks like TWC is just trying to make build a technological end run in order to stymie cable channels from selling themselves to subscribers a la carte.

It's remarkable how many people here are suddenly on the side of Time Warner Cable(!) and iPads(!!) as long as they're providing Teh Shiny New Modality.

Re:My thought is...

[_Sprocket_]

No, me not watching your shows because they aren't in the format I wish will "disrupt your current and future revenue streams" though.

I know the smug response to this idea is going to be along the lines of dismissing the guy who talks about how they don't watch TV in their house. There is this underlying belief that the mainstream is chained to their favorite programs and they will climb every mountain in their way to maintain their program loyalty. Those who make a big deal about breaking that bond are the ones who turned their backs on the water-cooler society and fled to the mountains to be strange social pariah hermits; nobody else wants to be like that. But that's not it.

Once one misses one or two episodes of a show because of scheduling conflicts, it is much easier to miss the 3rd, 4th, and 5th episode and so on. If that happens enough, the show loses viability. That happens to enough shows on a given channel, the channel loses viability. The key here is what constitutes a scheduling conflict. In the day of Tivo, bit torrent, and other competitors who don't mind streaming their shows... the bar for conflict is dropping steadily.

One can almost hear the sound of revenue streams being disrupted line pane after pane of glass being shattered. It's already happening as people outside the industry proper toss around DVR and P2P rocks. Its only going to get worse as competing networks pick up a bat and start casting their programs through alternative channels.

Re:My thought is...

[betterunixthanunix]

People are probably taking Time Warner's side because streaming cable channels to your computer is so obvious that everyone is shocked that the channels are objecting to it. The fact that Time Warner is doing it, and channels are trying to stop them, is pretty much where everyone stops reading.

Really, there should be no litigation here. Customers pay for cable service, which means channels are streamed to them; it should make no difference what type of computer they use to watch those channels.

Re:My thought is...

[afidel]

Except the end user has already paid for the content twice (subscription and ads), only freaking insane media cartel thinking demands that the customer pay for the content a *third* time. Personally I don't care because if they make it too expensive or too inconvenient I'll just stop using their product all together. I'm already going to be watching less tv this quarter because my cable provider is going 100% digital thus killing my HTPC's PVR capability until I can get a CableCard tuner, but that's ok because it's starting to get warm enough to enjoy the outdoors again =)

Re:My thought is...

[R3d M3rcury]

It's strictly a business deal between content producers and a cable distributor; the content producers think Time Warner is welching on their deal to distribute the data according to their contract.

The problem is, of course, that they are not.

Time Warner has the right (via these contracts) to distribute the cable channels' content to me in my house. How I view it--whether on my beautiful 50" Plasma TV with Dolby Surround Sound or on my crappy 20" Tube TV with mono speakers--is besides the point. The iPad app basically turns my $499 iPad into a 9.7" TV with a cable box so if I want to watch the game in the backyard, I don't have to drag a TV and wire out there.

What I choose to view the content on is not covered by the contract, nor should it be. Remember, these content producers are the same people who figure I should by a CD for my house, a CD for my car, and a CD for my office if I want to listen to their music in three different places. I don't have a lot of sympathy for them.

What if a cable channel wants to stream their channel themselves for direct subscription revenues?

Frankly, Cable Channels have had the option to do this for many years. They choose not to. They choose not to because they're not certain that they'll make the same amount of money. They make x dollars now distributing through cable operators and they don't want to jeopardize that money. If they started doing their own distribution, they'd be competing against the cable operators. Cable operators hate competition.

It's remarkable how many people here are suddenly on the side of Time Warner Cable(!) and iPads(!!) as long as they're providing Teh Shiny New Modality.

I'll admit, it's kind of like watching two bullies fight. In this case, though, I'll root for TWC because of the contracts.

Look, if you figure you should be paid more because I watch your program on a 50" Plasma TV versus a 20" Tube TV, that's your right as a content producer. Write up the contracts appropriately. But don't come crying to me because you made this deal and then some new way to view your content came out and you figure you should be able to get more money.

they're right

[frozentier]

The channel owners are right. You have NO BUSINESS getting what you already pay for! Especially if it is more convenient for you.

Re:they're right

[Idbar]

I think the key sentence in the summary is "I don't know what a TV is anymore". The line between a TV and a computer has become so thin, that I wouldn't be surprised if they come up with a DRM system/License that TV makers have to have in order to ensure the device is an "actual TV", just like HDCP compliance. But as long as they get all the money for broadcasting poorly produced shows (realities, which lack actors and writers) and get lots of profit, they will litigate as much as they can, because all that money has to get into the pocket of some executive.

they're right!

[eagl]

Good god, if a tv show intended for viewing on a tv inside a home was allowed to be shown on one of those newfangled gadgets that are electronical and have viewing screens that show magical MOVING IMAGES while inside a home, who KNOWS what might happen NEXT! We gotta stop this NOW, before someone thinks of a way to somehow magically store those shows to see them later inside that same house, or, god forbid, see the shows on TWO TVs in the same house at the same time!!!!!111eleventyone

everyone panic and someone for the love of god CALL THE LAWYERS!

Oh my God, they are only paying me ONCE.

[gurps_npc]

Person A has paid for the service. They have the right to get the TV. The channels are upset that they are only getting paid once when they see other businesses have managed to cheat and get paid twice.

The fact that other companies have found a way to rip consumers off does not give you the right to do the same.

Not sure what the big deal is

[unassimilatible]

This is way less of a threat than the Slingbox, which has been around for years. I've been streaming my TiVo and cable content to myself over the Net for 5 years. And of course they have iPad and iPhone apps now...

Re:Not sure what the big deal is

[Jerry Rivers]

Yup, I do the same thing. I have a Slingbox hooked up to my sister's cable service in Canada so I can watch programming I can't get here in the states. Works like a dream, yet I don't hear any bitching by the content producers.

Would RIAA v Diamond cover this?

[OverlordQ]

How SCOTUS decided that:

Rio merely makes copies in order to render portable, or 'space-shift,' those files that already reside on a user’s hard drive.... Such copying is a paradigmatic noncommercial personal use.

If I buy Time Warner Cable, and have Time Warner Internet, and get shows from Time Warner and this app requires the above, wouldn't displaying the stream on an iPad instead of a television simply be space-shifting the stream.

The sad part is TWC finally did something GOOD...

[robmiracle]

for their subscribers. For a company that is loated and hated by most of their customers who feel trapped in a dictatorship of ever escalating pricing, poor quality and lack of innovation, this iPad app is a serious step towards them doing something great for their customers.

Re:They get paid ~75 cents per home.

[mysidia]

They're trying to preserve theoretical income they don't have yet.

Time warner is a middle man. The channels want to bypass the middle man and sell streaming content over their (Time warner) internet connection to end users for retail price (instead of discounted prices you sell to a middle man at), while still charging Time warner high prices deliver the same channels to the same subscribers' TV.

Re:'If we litigate, we have a chance to win.'

[LordStormes]

The right solution here is for somebody to make a TV/Internet service that allows 100% a la carte channel/content offerings. I have to pay $80 for TV to get all the stuff I want to see, but I have interest in fewer than 1% of what's available. I don't want your Music Choice, or your porn (I have my own of both). I don't want Martha Stewart. I don't even want football games other than the ones my team plays in. Seriously, the best model for stuff like this is iTunes right now. For the last season of Stargate Atlantis, I didn't have a cable subscription, so I paid $20 for a 4-month season pass for SG:A, effectively paying $5 a month for the one show I cared about rather than $100 a month for a zillion shows that I couldn't care less for. I got all the episodes, in HD, when I wanted to watch them, and without commercial interruption. My only gripes are that the people who watched on TV got to see it a few days earlier, and that the video purchase ratings don't count as heavily when determining whether to renew a show. Maybe that's the solution - let's take a recently cancelled show (pick any of the ones SyFy recently axed). Set a production budget for a season of the show, and then post online, "We need X dollars, which is X/20 subscriptions at $20 each. If we can get at least X/20 pre-order subscriptions, we'll have a season." I bet they'd make a pretty nice profit, and have nobody to share it with (except maybe Apple/Amazon/Netflix).

Turn it off!

[mallyn]

It's free;

And go out and play! Do hobbies!

I've been 'free' for 32 years.

Resistance if futile.

[Mysticalfruit]

Apparently these hacks missed the whole DVR revolution? They never ever heard of slingbox?

As far as I can recognize TV viewers fall into the following categories.

* Traditional TV watchers who structure their lives around watching specific shows at a specific time.
* DVR TV watchers who sit down and watch a previously recorded show. Maybe at some specific time (such as after the kids are in bed, etc) maybe not.
* Content consumers who watch their show of choice on their device of choice, may it be a tablet, laptop, smartphone, etc.

It's quite possible there's a Venn diagram of the latter two.

The executives want the first kind, stubbornly tolerate the second kind and absolutely hate the third kind (it would appear). What it comes down to is that their revenue model is breaking and they can't adapt fast enough.

I'm of the opinion that we need to move to an ala-carte system where you'd pay for the channels you want.

Re:They get paid ~75 cents per home.

[SighKoPath]

And all of that is why we want net neutrality.