Peter Suciu
Can Netflix kill cable TV if it's part of it?
Streaming television services such as Netflix, Amazon Prime, and Hulu have long held appeal to so-called cord-cutters who seek to enjoy TV content without having to subscribe to conventional cable TV.
Who needs 1,000 channels, they ask, with a monthly bill to match?
The challenge: Many cable companies also serve as Internet service providers, making it difficult to truly cut the cord. Netflix announced that it had struck a deal with the seventh-largest cable operator in the US, Suddenlink, to put its streaming service on cable boxes for the cable operator's 1.2 million customers.
In late April, three smaller cable companies -- RCN, Grande Communications, and Atlantic Broadband -- announced that they too would carry Netflix on cable boxes provided to some 500,000 customers through an agreement with TiVo. Netflix and its peers, commonly referred to as over-the-top (OTT) content, were supposed to disrupt the traditional cable business. Have they become part of the problem?
"Netflix has been commonly positioned as competitive to cable TV," said David Isenberg, chief marketing and strategy officer for Atlantic Broadband. "But the two services are really very complementary."
What happens if broadcasters lose the Aereo case?
[Commentary] Should Aereo win the right to retransmit the over-the-air signals of television broadcasters, other operators could use similar technologies to also avoid paying the retransmission fees, and that, say some legal experts, could undermine the entire broadcast business model.
The rumors of the death of broadcast TV could be greatly exaggerated however. Pamela Samuelson, professor of law at UC Berkeley School of Law said: "My prediction is that the court will split on the case, but Aereo will win on statutory interpretation and the court will say if you don't like this result, tell it to Congress.
Aereo has on its side that Microsoft and other tech companies think that many cloud services companies would be at risk if ABC's interpretation of the statute prevails." However, the broadcasters may instead opt for what some have called the "nuclear option."
In the summer of 2013, executives at Fox threatened to pull its prime time content and move it to a cable offering, while more recently CBS hinted it might also consider such a strategy. The question becomes whether broadcasters could really make the jump to cable.
Internet TV is growing, but there's a catch
Tens of thousands of viewers who tried to tune in for Sunday's season finale of the HBO hit crime drama True Detective may have been left without a resolution to the complex plotline. It wasn't because of a cable outage. It wasn't because of a blackout sparked by a cable services feud with a pay-TV channel. Rather, it was the result of so many people trying to watch the finale on HBO Go -- the cable channel's streaming service.
Streaming media -- or "over the top" (OTT) as it's called by those in the industry -- has long been seen as having the potential to seriously disrupt the status quo of the cable television business. But HBO's recent failure shows that the drama isn't limited to just what viewers are watching on the screen. Even Netflix, which successfully transitioned from a DVD-by-mail service to a streaming provider, has had problems ensuring quality of service. Many viewers who expected Blu-ray or at least DVD-quality video were left with a picture of much lower resolution, especially during peak hours where demand was high.
"It is an inherent problem with OTT," said Greg Ireland, research manager in the consumer markets for video program at research firm IDC. "If we expect the OTT market to develop and supplant traditional paid TV, then reliability and quality becomes so much more important."
Netflix, which is now producing original programming such as the critically acclaimed and award-winning series House of Cards, recently agreed to a deal with Comcast so that its subscribers using Comcast's service would see improved picture quality, rather than the lesser quality picture resulting from throttled bandwidth. Netflix reported that speeds to Comcast customers were up 11% in February from the month prior, following four straight months of declines. Netflix -- the Internet company seen as competing with traditional cable channels such as HBO and Showtime -- must pay the cable company to ensure quality of its streaming service. The fates of the disruptor and disrupted are intertwined.