Don’t Switch From Cable Just Yet
Posted on: Friday, 25 July 2008, 07:40 CDT
Some couch potatoes have no interest in watching sports or children’s shows. So why should they be paying for it?
U.S. TV watchers are asking that very question as cable TV costs continue to rise. The government also wants to know why customers can’t purchase the channels they wish too. Companies are now conjuring up alternatives to deliver only the shows consumers want.
New choices from Amazon, Sony, Netflix, Roku, and Microsoft’s XBOX console promise to do away with cable.
The latest ideas aim to solve a multitude of problems like the complexity of setting up these devices, lack of content, and high prices.
Nearly 8 million Netflix customers, who would normally rent DVD’s by mail, can now purchase a set top box from Roku for $99 that allows them to watch almost 12,000 shows and films for no additional cost.
Sony Bravia TV owners can now watch YouTube videos via a $300 add-on. Soon, they will be able to purchase movies and shows from Amazon that will be streamed directly to their TV.
Sony Bravia TV owners who buy a $300 device that connects to the back of TVs and to the Internet can already watch YouTube videos. Soon, Bravia customers will be able to order from Amazon movies and shows streamed directly to TVs.
Experts don’t believe that cable will be replaced in the near future. They point to a number of high profile failures including Akimbo, and Walt Disney backed Moviebeam.
"The content deals are starting to come together, but the library is still pretty narrow," said Mark Kirstein of MultiMedia Intelligence, a Scottsdale, Arizona-based market research firm.
While high prices, and aversion to multiple living room gadgets are reasons for failure, foremost is the lack of premium channels such as Time Warner’s HBO.
But the tech industry is buzzing yet again after a number of new products addressing these issues were recently revealed.
According to James McQuivey, analyst for Forrester Research, the Netflix/Roku set-top box is emerging as the leading candidate for consumer appeal.
"Despite its relatively meager content, the Netflix Player by Roku is a solid winner, overcoming the barriers that hamper the rest," McQuivey said.
Unlike other devices that came before it, Roku is planning on offering services beyond just Netflix, said Tim Twerdahl, vice president of consumer products at Roku.
"Our vision is to open up the box," he said.
They plan to provide free advertising-support video services, YouTube-like user videos, and pay-per-view.
Netflix is also providing new services for its users by recently striking a deal with Microsoft’s Xbox 360 online service, allowing user to watch streamed Netflix movies.
Earlier, Netflix said it would offer its Internet service on a set-top box manufactured by LG Electronics.
"It's too early to tell who is going to prevail," said Netflix spokesman Steve Swasey .
Industries watchers agree that the new crop of products are the first to show any real promise, but more importantly are backed by deep pocketed financiers.
Critics point out the fact that Apple Inc’s AppleTV has yet to excite the tech industry like iPod and Itunes has transformed the music business.
Hollywood is worried about jeopardizing DVD sales-which make up half its profits-so its been reluctant to offer new releases on the Internet.
"They're going to fight amongst each other for a teeny-tiny part of the market," McQuivey said. "If you have cable service and a DVD player, you already have a much better solution than any of these boxes can provide you."
Sony is hitting the problem full on with a twist, by appealing to its own movie studio to release its films ahead of the DVD release. It plans to offer Sony Pictures’ "Hancock" later this year for Bravia TV owners.
Sony Electronics’ senior manager of business development Robert Jacobs said, for now, "this is a Sony initiative. It's something that can be realized with other studios."
Source: redOrbit Staff & Wire Reports
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