Online Streaming Content
The battle lines have been drawn, and it looks as though it could turn out to be a long war. On the surface, things appear to be friendly. Last year AT&T introduced online streaming content to their U-Verse website. Subscribers were surprised to find out that all of the content came from Hulu.com. Why would AT&T waste time and money duplicating Hulu’s content? It seems like a win-win situation for Hulu and the networks that own it.
To understand the real reason for AT&T’s actions, one would need a spy on the inside, but it would at least appear that they plan to eventually expand their range of content sources, maybe even pushing out U-Verse TV content directly over the Internet (something they tried in a limited number of locations). But even that does not fully answer “why“.
The truth is, AT&T, Time Warner, Comcast, and other traditional cable/satellite/etc providers are scared. For decades, they have enjoyed the luxury of being the only medium for you to receive premium content. Broadcast television still exists, and there are still a few loyal antenna owners out there. But for the most part, cable TV has become the standard.
Aside from running off to the video store to rent movies or shows, there was essentially no other way to watch anything in your home without their authorization. Thus, they exerted tremendous control. You did not have to choose cable over satellite, or vice versa, but if you wanted access to the content, you had to choose one.
As broadband Internet access has become more readily available, from the same providers who brought you cable, the ability to stream television shows and movies has become a reality. Computers are faster, and bandwidth costs are not nearly as expensive as they once were.
This has placed the networks back in the driver’s seat. Cable providers, after all, are just middle men. Why should NBC depend on Comcast or Time Warner to deliver HD shows to your home for a fee, when it is delivered over the airwaves for free anyway? By giving access to those same shows over the Internet, the networks have greater control over advertising, can potentially bring in more revenue, and can effectively cut out the middle man. Hulu is a product of this thinking. Add Netflix’s “Watch Now” feature to the mix, and even premium movie channels are no longer exclusive to cable providers.
Comcast responded with Fancast, which provides access to on-demand TV shows and movies, many of which come from Hulu. If you are not seeing a pattern yet, you should. In addition to giving their users access to other online video sources, Comcast has integrated their own on-demand content. AT&T will undoubtedly do the same.
Both Comcast and Timer Warner recognize the real threat from sites like Hulu and have initiated their TV Everywhere or OnDemand Online initiative, which will authenticate their subscribers before allowing them to view online content. If do not subscribe to a cable service, you will not be able to watch their content online.
It may seem like the cable providers are a little late, but their influence over both Internet connectivity and television puts all of us in a precarious situation. When Time Warner attempted to throttle bandwidth, it was under the guise of limiting greedy users who most likely spent days and nights distributing illegal BitTorrent chunks. But a more likely explanation is that limiting bandwidth also limits the amount of streaming television and movie content users can watch without access to cable TV. That plan, of course, fell flat, but their new strategy is to beat the competition at their own game.
TV Everywhere requires users to pay for content they can get for free elsewhere. The answer to “why” is: because Comcast and Time Warner say you should be paying for it. This may not seem like a problem, since non-subscribers can still use Hulu and sites like it, but the danger is that cable providers will sign exclusive deals with networks to deliver their content for them, replacing one flawed middle-man scheme with another. If that reaches fruition, even mobile phone users may not be able to watch a video without first inserting a coin into the Time Warner/Comcast money machine.
The sad reality of the situation is that the advertiser-supported online video that was designed to reduce the number of viewers who prefer methods like illegal file sharing, may eventually end up encouraging those numbers to increase. People now know that content can be delivered in multiple formats, to multiple devices, very quickly. They want to be able to pick up an iPad, netbook, or Android phone and watch the same content they could see on their computer or television, without unnecessary artificial restrictions. That will require both television networks and cable providers to embrace the open nature of the Internet. Right now, they fear it, but in the end, their future may depend on it.
Tags: Hulu, online streaming content, TV shows
