Monday, July 06, 2009
Rise of Internet Video
We've seen it coming for a decade. It's not quite here yet, but the New York Times reports that CommScore reports that 150 million U.S. Internet users now watch an average of 97 videos per month with an average duration of 3.4 minutes per video.
With the writing on the wall, do U.S. cablecos have full time teams working on their future business? If not, they might as well start a calisthenics program so they are able to kiss their own ass goodbye.
Or are the cablecos supposing that inaction-based scarcity, and law based on same, will provide the equivalent of a government bailout?
With the writing on the wall, do U.S. cablecos have full time teams working on their future business? If not, they might as well start a calisthenics program so they are able to kiss their own ass goodbye.
Or are the cablecos supposing that inaction-based scarcity, and law based on same, will provide the equivalent of a government bailout?
Technorati Tags: Cableco, Content-Conduit, Internet, video
Comments:
The cable companies are not acting on it because there's not much to be done.
Internet bandwidth costs money. And individual delivery of streams -- a "boutique" service -- costs a LOT more money and consumes a LOT more resources than broadcast media such as analog or digital cable TV or satellite.
What's more, the cable companies do not control the cost, because they are not themselves Internet backbone providers. They frequently do not own the "middle mile," either.
The best they can do is the same thing any ISP can do as Internet video becomes more popular: obtain Internet bandwidth as inexpensively as possible for their customers and try to give them the best deal they can while not losing money.
Users who don't understand the technical issues may complain that watching the same shows via IP video costs more than via cable. They might even mistakenly believe that charging more for it is an anticompetitive tactic... but it's not. It simply costs more and takes a lot more resources to view it that way. I know: I'm an ISP. And I'm paying about $100 per Mbps per month for bandwidth. And some cable companies which are captives of the ILECs pay just as much.
So, users will have to pay up. There's nothing the cable companies can do about that.
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Internet bandwidth costs money. And individual delivery of streams -- a "boutique" service -- costs a LOT more money and consumes a LOT more resources than broadcast media such as analog or digital cable TV or satellite.
What's more, the cable companies do not control the cost, because they are not themselves Internet backbone providers. They frequently do not own the "middle mile," either.
The best they can do is the same thing any ISP can do as Internet video becomes more popular: obtain Internet bandwidth as inexpensively as possible for their customers and try to give them the best deal they can while not losing money.
Users who don't understand the technical issues may complain that watching the same shows via IP video costs more than via cable. They might even mistakenly believe that charging more for it is an anticompetitive tactic... but it's not. It simply costs more and takes a lot more resources to view it that way. I know: I'm an ISP. And I'm paying about $100 per Mbps per month for bandwidth. And some cable companies which are captives of the ILECs pay just as much.
So, users will have to pay up. There's nothing the cable companies can do about that.
# posted by 
: 7/06/2009 6:07 PM
: 7/06/2009 6:07 PM
