The Dreaded Bundle Comes to Internet TV

[Commentary] In short, instead of the Internet killing the bundle, the bundle is coming to the Internet; it would not be surprising if, in the next year or two, half a dozen more neo-bundlers join the game. This may come as a surprise to those who expected the television of the future to resemble, say, a smartphone screen, where every channel would be roughly like an app that you subscribe to à la carte. But overestimating change in the television industry is a rookie mistake. Just why is the neo-bundle model on the rise in Internet TV? For one thing, content companies like ESPN don’t necessarily want the annoyances of dealing, like Comcast or Netflix do, with direct subscribers, who are always threatening to leave and demand that irritant known as “customer service.”

There are also some people, as we’ve said, who really do prefer to buy by the bundle -- buying kitchen knives in big sets remains very popular. But more important is the fact that selling content in a bundle nearly always yields more money for the seller. The neo-bundles are a compromise: they exist to try to maintain some of that economic advantage while also appealing to a generation of people who, when it comes to television or frankly any kind of entertainment, want to get what they want exactly when they want it -- the so-called “now” generation. Apple will release its own version of the neo-bundle in the fall. Perhaps, as with iTunes, the company will once again connect the twain cultures of Silicon Valley and Hollywood. In the meantime, the gap between the norms of the Internet and those of television, if narrowing, remains.