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CED Article Preview: Cable’s Online Video Opportunity

Next month CED magazine will highlight a contributed article from Motorola executive Buddy Snow on “Cable’s Online Video Opportunity”. Since the content ties in nicely with some of the content I’ve posted on this blog, I asked CED’s permission to publish an excerpt here. Below is a small section of the article due out next month. Be sure to check out the full article in CED‘s May edition.

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…If you go by the numbers, or better yet the dollars, Internet video is still a small-time business compared to its broadcast television counterpart. Companies spend close to 70 billion dollars a year in TV advertising, while online video advertising still gets less than one billion dollars annually according to industry analysts. However, the growth rate of online video and the emotional chord it strikes with consumers – who love to control what video they watch as well as when and where they watch it – makes Internet video an uncomfortable, lurking presence for many TV service providers. Add to that the fact that online video eats up a lot of bandwidth, and you have a serious thorn in cable’s side.

The problem for the cable industry, however, is really one of perspective. While the concerns surrounding Internet video are valid, the opportunity is greater than the threat. Who is better positioned than existing television service providers to deliver any kind of video into the consumer home? Cable operators already own the broadband pipes, enjoy an extensive customer base, know how to monetize both live and time-shifted content, and understand how television technology is evolving. By capitalizing on these strengths, cable providers can make Internet video a complementary asset to their existing television content and profit from the ability to deliver media seamlessly from different sources. Internet video opens the door for cable operators to enable the new networked home…

…Because cable operators have already invested in digital video recorders (DVRs) and video-on-demand (VOD), they have bridged the gap in the eyes of consumers from being simply transmitters of TV signals to service providers that can deliver a more complete and personalized entertainment experience – an important step along the road to entertainment convergence. Cable subscribers can record their own hit television line-ups through their DVRs and access a range of video on-demand selections from popular TV shows to fitness routines. It’s a much different experience than cable a decade ago, and consumers have bought into it. Cable’s strength means that Internet video is still something of a digital island. Since most of what consumers watch is still on TV, it makes a great deal of sense to join Internet video to the TV mainland, and that’s something only existing TV service providers can do…

2 Responses

  1. […] recognition of the need to bridge the gap to the Internet, both Comcast and Time Warner Cable have now said they will make select programming available […]

  2. […] IP to deliver TV to the TV set, and cable also has living-room IPTV in it sites. These operators have the luxury of connecting online video content to the premium content they’ve already secured. And on top […]

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