Remember when I was writing about Sony the other day, well really it was about Google TV and stuff, but I mentioned that Howard Stringer, the Sony CEO, was talking about big R&D in a new TV. Well, some speculation has launched into what that will be now and it seems that they want to cut your cable for you and give you video through an online service. Me? I love that idea!
A Sony Online TV Service On The Horizon?
Some people are talking about Sony approaching some big media companies like NBCU, Discovery, News Corp, and offering them a new way to get their channels to the masses, via an online service, connected perhaps to the new Sony TVs that are in the works. It could also be sent to Playstation consoles and connected Blu-Ray players. Hey, if it's cheaper than cable, I'm totally in. Besides, I wouldn't have to pay $17.95 for a cable box, $2 for a remote and all that crap on top of everything else.
There are some 18 million PS3 consoles out there in US households, combine that with the install base of the connected Blu-Ray players and Sony connected TVs and you've got an audience larger than the biggest cable company, Comcast.
The problem will be the cable companies. They're already in knee-deep with those media companies and while the Sony offering could save consumers money, the cable operators aren't going to take it sitting down. Plus, the broadcasters won't want to jeopardize their agreements with them. I imagine there's going to be a whole new round of contract negotiations where the cable operators will try to keep them from getting on board this idea.
However, they might really want to reconsider. NBC is broadcast in most markets anyway so they've really got nothing to lose. The same with CBS, ABC and FOX. Plus, NBC is merging with Comcast anyway so they shouldn't care, they'll just put in a clause that says it can't be offered in Comcast areas.
That's sort of the problem with cable TV anyway. There's no competition. Here in Milwaukee, I'm in a Time Warner Cable area, period, end of story. Since I absolutely loathe AT&T (the evil empire, complete with their own death star logo) and won't use Verizon, I'm pretty much out of luck for terrestrial television (which is also a reason I've been poking and prodding satellite service lately).
How this monopolistic set up came into being is beyond me really. Apparently, federal regulators have turned a blind eye to it for quite some time and should really take a good hard look at it.
Anyway, I digress.
Sony is probably attempting this in reaction to the Xbox LIVE TV initiative going on over at Microsoft, their main competitor in the console biz (though Xbox 360 has been whipping them six ways to Sunday sales wise for some time).
Finally, there's that whole problem with who owns the pipeline. If you want TV service online through Sony, it will come through your Internet service provider pipeline, in my case, it's Time Warner. So Time Warner could simply block that service from its lines. That would then prompt me to go find a new ISP, but most consumers wouldn't. What needs to be done, and this is partly what things like this are doing, is putting pressure on the cable operators to make their pricing more fair. Right now, I pay about $100 a month for 15Mbps Internet and Digital HD cable. As I said, about 10% of that is for equipment. Internet is about 40% so 50% of the bill is TV service and 10% is the equipment for the TV service. On top of that, I have tons of channels I will never, ever watch because that's how cable is bundled and that stems from the media companies charging stupidly high license fees so that smaller bundles cannot be made.
Perhaps if they would all sit down and do a feasibility study, they would find that the revenues they could generate with more generous pricing would far outweigh what they're getting now. Many people are trimming back on pay TV packages already in lieu of online content. In fact, right now I could get away with no cable TV because the only sport on is football and that's broadcast over the air digitally. There are so few things I watch on non-local stations that I don't even know why I've got cable when there's no baseball being played. I could watch NHL, but I can get that on my PS3 already.
The best case scenario here is that cable operators see what's coming down the line and decide to offer customers better deals. I would be all for a streaming only TV service where I have both the option to watch things first-run as well as on-demand. I would even go so far as to pay a reasonable price for it, provided I didn't have to, again, pay for more equipment from them on a monthly basis. If I could get a tuner card for my PC and get it all streamed in full HD and use the PC as my DVR, but still have the on-demand functions, something that TWC does not even allow with the CableCard which is total bulls–t, I'd gladly give pay my bill… and it might even be on time each month.
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