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Steven J. Vaughan-Nichols

Internet TV still isn’t ready for prime-time

By | February 10, 2011, 1:40pm PST

Summary: I like TV on the Internet, but, when push comes to shove, it’s not ready to replace conventional cable, satellite and over-the-air TV. Darn it!

I’ve been watching TV over the Internet since its very early days. Today, I own, and use, an Apple TV, a network capable Sony BDP-S570 Blu-ray Disc Player, and a Roku KDS. I also subscribe to Hulu Plus and Netflix. I could go on and on, but you get the idea. I know, like and watch TV over the Internet all the time

That’s why I’m not happy to report that for many people, TV over the Internet still isn’t good enough. Oh, it’s not the video quality. With a high-speed connection, like my own Charter cable 25Mbps (Megabits per second) connection, 720p HD video comes in just fine. Oh, in the future, it may be another story. There’s not enough Internet to go around for everyone to watch TV over the net. Even now, Netflix alone is taking up an insane amount of available Internet bandwidth, but that’s not the problem I see most people having with the currently generation of video streaming services.

No, the real problem is in content. As most of you know, most sports aren’t available over the Internet. There are some exceptions, such as ESPN3, which I see is now showing—I’m not making this up—high school field hockey. And, as a baseball fan, I like that I can watch baseball both on my PC and on my Roku via MLB.TV. Past that though, the pickings get scarce.

That’s old news though. What really made me aware of what a big problem content is on the Internet was a series of articles by my old friend Tristan Louis on just what was, and wasn’t available as video-on-demand (VoD) over the Internet. Louis looked at the most popular 100 movies of 2010; the top 50 U.S. TV shows in 2010; and the top movies of the last few years.

Would you guess how many of them are available for display on your TV? Out of the top 100 movies of 2010, as of late January 2011, 74 of them were available on DVD, but only 48 were available on Amazon Video on Demand; 46 on Vudu; and Apple’s iTunes Store; and a lousy 10 on Netflix. Many popular recent movies, like Red and The Book of Eli, weren’t available on any service.

Previous years weren’t much better. Avatar? No The Hangover? Nope. Sherlock Holmes? Elementary my dear Watson! No.

Even more annoying, even when they are available, they’re often available only as one-time rentals. Want to re-watch an old favorite? Unless you’re lucky enough for it to be on Netflix, it will be another couple of bucks per viewing.

That’s lousy, but it’s not much better when it comes to television shows. Out of the top 50 TV series, iTunes does the best with at least some episodes of 78% of the most popular shows, followed by Amazon with 56%; Hulu Plus with 24% and Netflix with a dismal 4 (four!) percent. The more popular the show, the less likely it is to be available. For example, of the top five TV shows-—NCIS, The Mentalist, CSI, NCIS:LA and (oh America how can you watch this!?) Two and a Half Men–only the last can be rented.

These numbers don’t tell the whole story. Many of those shows on Amazon or iTunes are only available for purchase.

What all this boils down to is that if you want the most popular movies and TV shows for a flat-fee, video on the Internet still isn’t for you. I’ve thought that Internet VoD would kill off first over-the air (OTA) TV and then satellite sometime soon. I was wrong.

Besides the technical issues of delivering enough bandwidth, the real problem is there isn’t enough of the content that most people want to see. Internet TV is speeding up the death of the video store, but conventional television broadcast methods still have many more good years left in them.

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Steven J. Vaughan-Nichols, aka sjvn, has been writing about technology and the business of technology since CP/M-80 was the cutting edge, PC operating system

Disclosure

Steven J. Vaughan-Nichols

Steven J. Vaughan-Nichols is a freelance writer. He does not own stocks or other investments in any technology company.

Biography

Steven J. Vaughan-Nichols

Steven J. Vaughan-Nichols, aka sjvn, has been writing about technology and the business of technology since CP/M-80 was the cutting edge, PC operating system; 300bps was a fast Internet connection; WordStar was the state of the art word processor; and we liked it.

His work has been published in everything from highly technical publications (IEEE Computer, ACM NetWorker, Byte) to business publications (eWEEK, InformationWeek, ZDNet) to popular technology (Computer Shopper, PC Magazine, PC World) to the mainstream press (Washington Post, San Francisco Chronicle, BusinessWeek).

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RE: Internet TV still isn't ready for prime-time
russman4 2nd Nov
@JenniferWeb Tvdevo is a SCAM site. She posts this spam all over the internet. Just google tvdevo scam and you'll find lots of reports on this site. Beware on this one!
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Demand will eventually force content developers (TV/Movie) to distribute through the Internet. This happened with music and it will happen with everything else as well. The iPod generation is not going to schedule their day around the TV Guide. DVRs essentially create on demand content but that technology will lose out to the shows that can be streamed on demand. This is an old industry with lots of money and legal clout. It will take time for them to embrace a new delivery method but it is inevitable.

Secondly, Advertisers prefer Internet advertising because it is more targeted and provides better feedback. They have stopped spending as much money on TV and radio advertising and this will probably be the biggest reason content will eventually be streamed.
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Radio is popular
FADS_z 10th Feb 2011
@bryanbeaty
video content on Intenet, yeah, sure, when they are free.
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@bryanbeaty

You can set up IE 9 so nobody is getting any feedback. I presume with the right addons you can do the same with Firefox, with Chrome you can't (not counting the approach of headers telling other web sites not to track the current user, which no advertiser is going to honor).
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@bryanbeaty
That's a rather simplistic view. What's the revenue generated by internet advertising FOR INTERNET TV streaming? It's a fraction of what the broadcast networks get.

Also, consider that advertising is no longer the biggest revenue source for many broadcast networks. It's the carriage fees charged to cable/satellite providers that generate huge blocks of revenue for the content providers. And that's something that internet TV does not have an answer for right now. As far as I know, ESPN is the only internet TV streaming site that charges carriage fees to ISPs for access to their programming. And those charges are relatively low because their online audience makes up less than 1% of their total viewership, despite having live streaming for 3,500 events a year, some of which are not carried on any of ESPN's broadcast networks.
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Content isn't the only problem
AllKnowingAllSeeing 10th Feb 2011
It's just one of many.

What's the easiest and quickest way to see what's on TV? How do kids watch TV? Who downloads their shows? How many do you need to download? How many different services and devices do you need to watch 80 different TV channels on TV? How much does it cost to watch a show on TV to see if you like or dislike it?

It's not just content, there are alot of things that make it "not ready for prime-time" the least being content.

It has to be as easy to use as picking up the TV remote in one hand, while holding a drink in the other.
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I totally agree
John Zern 10th Feb 2011
@AllKnowingAllSeeing
I've pretty much said the same thing. Right now I pay one bill a month for unlimited TV viewing, with a little extra for "On Demand" movies, as I rent them.

All through one box, one account, one remote. Easier then the author's setup, I'll guess.
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It needs a merge, not a replace.

GoogleTV already does this, but nobody seems to understand it. Search once, get results for everything (scheduled TV shows, movies, on demand TV shows, movies, YouTube videos, Wikis, pictures, etc).
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@Droid101
Didn't we have something similar in the yesteryears (like 90s) as WebTV? Of course like you mentioned we need a better integration of Internet with TV, not a replacement. But still GoogleTV is not there yet.
@Droid101 because they didn't bother to check with them before whipping up their device.. LMAO.. leaving googleTV a $300 (most competition is at $100 and below) streaming box that just shows crappy amateur video through a browser.. also acts as a home network streamer, but REALLY clunky in that mode..

it's a hunk of junk and that's why Google has pretty much scrapped it and went back to the drawing board.. it was a big FAIL!
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GoogleTV doesn't look bad, except for that it costs way too much money.
I already use a very inexpensive piece of software for watching tv online called TVdevo.com It's not Google TV,but it is a heck of a lot better when you consider the cost.
@JenniferWeb Tvdevo is a SCAM site. She posts this spam all over the internet. Just google tvdevo scam and you'll find lots of reports on this site. Beware on this one!
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@Droid101
Problem is that TV viewing is fundamentally a "lean back" activity, while Google TV is yet another search-based "lean forward" solution. It's complexity and extra steps for an activity that people want as simple as possible. That's why media PCs have never caught on, and that's why 75% of TV viewing remains in real time.

If "nobody seems to understand" Google TV, then the problem is not with the viewers.
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RE: Internet TV still isn't ready for prime-time
VRSpock Updated - 10th Feb 2011
We're watching LOST on Netflix on an almost daily basis...2 to 3 episodes a night. There is plenty to watch on there...most certainly more stuff that I want to watch, than I have time to watch, and most of it stuff I never had time to watch when it was broadcast "live" on television.

The whole "prime time television" scheme is as obsolete as black and white television and silent films. Sooner or later, all of the content producers will realize this and will restructure their delivery strategies for the new way of delivering content to subscribers.
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Not unless its as easy as TV is now.
John Zern 10th Feb 2011
@VRSpock
it has to be simple enough for a kid to do, unfortunately, its not.
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@John Zern
My kids use our Media Center with Hulu and Netflix all the time. Even the 5 year old has no problem with it. It's adults that seem to have the most trouble adjusting to new paradigms, not the kids.
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@John Zern
My 11 year old doesn't seem to have a problem using it.
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Contributr
@VRSpock Oh yes, there's lots of good stuff to watch out there on the net already. I've been watching the Avengers with Diana Rigg and Dead Like Me myself, but those aren't the shows most people watch.

Steven
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@sjvn@...

I remember having a teenage crush on Diana Rigg, I definitely liked the way she looked in black leather.
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@sjvn@... Most people are watching or have watched 30 Rock, Lost, Battlestar Galactica, Psych, and The Office, as examples. Also CSI, which started to show up for Season 9 on Netflix streaming. I still don't buy the argument that this is just showing oldies. You can watch some very good almost-current stuff on Netflix. It just varies by what the studios are willing to prop up. I don't mind being a season behind if it means I can avoid the price gouging of Com-borg.com.
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RE: Internet TV still isn't ready for prime-time
ItsTheBottomLine 11th Feb 2011
@sjvn@... Exactly
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@VRSpock
Yet, this "obsolete" notion of live TV viewing is exactly how 75% of viewing time occurs. And that's despite time shifting video devices having been widely available since the mid-1970s.

The reason why Lost is available on Netflix is because 10s of millions of people already saw those episodes when they were first broadcast. That's when you get the highest viewing numbers, and that's when the content is worth the most. I would presume that the audience numbers for Lost on Netflix are far smaller.
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Stopped reading when you mentioned...
doctorSpoc 10th Feb 2011
That Red and book of Eli were not available on any service.. I rented Book of Eli like 3 months ago on my appleTV.. Red is also available.. how do you want anyone to take you seriously with such inaccuracies???
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Contributr
@doctorSpoc Well Red wasn't available for rent when I checked & Book of Eli is purchase only on my iTunes. The studios do change what's available, and what isn't, all the time.

Steven
@sjvn@... and the studios and networks at times seem to have no rhyme or reason to their actions.. on-demand streaming rentals do seem to be pretty in-line with DVD release now though.. there used to be as much as a month lag.. now that has pretty much released on same day some a few days difference.. but they alway seem to release for purchase first on DVD and streamed (presumably to squeak out that revenue 1st) then for rental.. depending on the studio some never go rental..

it's odd that Book of Eli has gone purchase only.. normally movies are purchase only 1st.. then they go to rental.. i rented and watched it on July 2nd, just checked my iTunes account.. $4.99 is definitely a rental.. i remeber it too, my bother's family was down for Canada Day.. great movie!
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whut?
'Red' (netflix dvd) sitting in my dvd player right now. was in my mailbox awaiting extraction for a couple of days.
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@BitBanger!USA
What does a DVD have to do with internet TV?
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guess you mean 'Red' not available via streaming...
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I suggest trying to do without TV for a couple of months. You'll probably be amazed to find that you don't really need it. Everything else in your life will start to be sweeter. It's just like giving up salt.
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The main thing keeping me from watching more internet video is that my television monitor isn't connected. I'll bet that's the number-one obstacle for most would-be cord-cutters. Can any of you point me toward survey data or other research that would shed light on this?

In any case, the primary danger to cable isn't that people watching four hours a day are suddenly dropping service. The danger is that most people are watching less cable and buying lower-tier packages because they're spending more time online. People who watched less than an hour a day are probably the ones cutting the cord.

I'm sort of in that category. I'm happy to contribute to the monthly cable bill while I live with two other adults. I probably won't get cable in my next living situation because I'll be watching NetFlix movies, NetFlix and Hulu TV shows and indie music videos on YouTube and FargoTube.

I also appreciate HD for sports, but I usually watch with friends at their houses. Cable just isn't worth $70 a month for me. It's not even worth $35 a month any more.
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@Cbagley
I cut the cord 2 1/2 years ago and it's been great! We get digitial TV OTA now plus with hulu and Netflix through the media center, we don't miss it. The kids probably miss Disney the most, but other than that I really think I'm better off putting that $50/month towards other things.
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Poor content...
NoAxToGrind 11th Feb 2011
Poor content, bandwidth issues, complicated to use.

No selling point there for me.
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@NoAxToGrind
I don't know where people get the idea there is poor content on Internet TV. I have Netflix and I get frustrated when I go over to a friend's house that has dish network because I can't find a single thing worth watching.....and they are paying a heck of a lot more than I am for content!

As for bandwidth, that is the ISP's issue....not Netflix, Amazon, Hulu, etc.....if your bandwidth sucks, it sucks for everything.....you just happen to notice it a lot more with video streaming.

My 11 year old doesn't have any problems using it. Niether does my wife or our friends when they come over....it's pretty simple....especially when the Wii is the only thing we have hooked up to our TV. When we want to watch DVD's, we use a homebrew app on the Wii for that.
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RE: Internet TV still isn't ready for prime-time
ItsTheBottomLine 11th Feb 2011
@VRSpock let me know how the sporting events work for you...
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@VRSpock

You use an app? I push a botton on the remote. Sorry but no thanks, not worth it to me.
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Question:
cwallen19803@... 11th Feb 2011
My internet access is though my cable company. Do any of you have internet access that doesn't also include TV content? If you're already paying for TV content, what is the attraction to internet TV, aside from scheduling?
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@cwallen19803@...

Me too, and shhhhh, don't tell them that I stream stuff from the net.

I do not feel what my cable company charges for basic cable is worth it.
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@cwallen19803@...
I have DSL...it's through the phone company...which currently requires me to have a basic phone line. That will eventually change....as will the requirement that cable companies now have for basic cable tv. They can provided internet without those services being active....in fact, Comcast used to provide internet only service when they first started offering cable internet. In the state of Florida, people on BellSouth DSL can even have a competing phone company for voice service. The reason they require you to have the basic cable or phone service is pure greed and nothing else.
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RE: Internet TV still isn't ready for prime-time
ItsTheBottomLine Updated - 11th Feb 2011
@VRSpock Don't have either of those issues here, of course I have a life too so I don't see Internet TV yet...pretty lame to me. OH, InsightBB and Bellsouth.
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Call me a throwback, but...
adornoe@... 11th Feb 2011
I like the idea that people should have to get off the couch and away from the remote and away from the internet to go out once in a while to go to a local theater to watch a movie, or to just rent a movie. People need to get out more and to become "social" again, not that "social network" nonsense that has people talking remotely with people they've never ever met in person.

Go out more people; become what we're supposed to be: social animals.
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@adornoe@...

I went outside......but I quickly ran back in screaming "Oh my G-d! The moon! It's on Fire!!!!!"
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RE: Internet TV still isn't ready for prime-time
ItsTheBottomLine 11th Feb 2011
@adornoe@... Very good, I can imagine the people here, don't really get that.
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"720p HD video comes in just fine"

Problem is, "720p" tells you virtually nothing. It only tells you the maximum theoretical pixels.

What it doesn't tell you is how good or how crappy the compression is. I've seen "720p" videos that are using compression that's so bad you might as well be watching SD.

After I started watching internet video, the terms "360p," "720p," and "1080p" have lost all meaning. ALL meaning. They're totally worthless. They're a theoretical maximum that almost nobody reaches. What's more important are the codec and the bitrate.

And honestly, I think it's time to start investing in variable bitrate codecs that scale with your connection. Constant buffering is driving me crazy. Making me manually select a lower a lower bitrate is very inconvenient. Sometimes I'm spending more time waiting for buffers and tweaking the videos to try to get them to work than actually watching them.

"No, the real problem is in content. As most of you know, most sports aren?t available over the Internet."

Agreed. It's painfully obvious the content providers want you to watch the TV as long as possible. They don't want you watching on the internet. None of the few remaining good TV/Cable shows are available online, at least not legally. I'm definitely in the market for a DVR or a tuner card as soon as I have the funds.
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Totally Agree! Still hoping, though.
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Here is the basic problem with internet tv. How are the producers of the content going to be paid? Tv is currently being paid for by advertising and subscriptions. Producers are NOT going toinvest millions of dollars in a drama or comedy or sci-fi show with out having some mechanism to recoup their investment. If all you want to do is to watch reruns of old series that have already made back the cost of production that is fine. There will be no new shows until a way is found to make money.
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@Jsimons4109 I'm perfectly fine with TV-like advertising. YouTube is already doing that for longer videos, I don't see why others can't.
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@CobraA1
Because you're not considering how the revenue structure and actual viewing habits currently stack up. The carriage fees for many networks exceed what ad revenues generate, and that proportion is increasing. ESPN collects close to $4 billion/year from carriage fees alone. And based on their estimated average carriage fees and subscriber counts, other popular networks like CNN, USA, and TNT each collect over $1 billion just from carriage fees.

Consider that YouTube's estimated annual revenues total less $1 billion, and Hulu's revenues were less than $250 million. Online video streaming sites generate nowhere near the kind of revenue that broadcast networks do.

And the reason for this is simple -- online video's audience numbers remain only a fraction of broadcast TV viewership.

ESPN streams over 3,500 live games a year, yet their online audience is less than 1% of their broadcast audience. Nielson's latest viewing time data indicates that average daily TV viewing time is over 5 hours, while average daily viewing time for all forms of network/online video is less than 20 minutes.

Among the major internet TV streaming sites, only ESPN currently gets revenues from carriage fees charged to ISPs (if you can see live games on ESPN3.com, then your ISP is paying a carriage fee and passing that cost along to subscribers). My understanding is that the fees are relatively low for now, because the audience numbers are low.

But, if the audience shifts more towards online streaming in a big way, then the various video streaming sites (at least the ones that carry original scripted or live programming) will inevitably start moving towards some sort of fee-based model. And the big push might be to levy carriage fees on ISPs, as ESPN already does.

Those ISPs that choose not to pay the carriage fees get blocked, and those that do have to pass those costs along to their subscribers, thus creating a similar structure to what we have right now with the cable/satellite companies, except that the big bills would now come from the ISPs.
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Any chance they are not playing the good content because they don't have the infrastructure in their company to support the bandwidth demand at their end?
Too much provider competition forces income down making more and more expensive content unaffordable so I agree in this case competition may be bad..
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Apple TV is
james347 12th Feb 2011
get on board with things that 'Work'.
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The situation is no better in The UK but the other big problem is a technical one. There is still no mass market settop box (i.e - Tivo/Sky+) that consumers can easily understand and get their head around. Most Internet TV watching is done from a desktop or laptop and that just makes it far too complicated to replace traditional TV.

We do have the fantastic BBC iPlayer in The UK though. Offering the majority of the BBCs content online for free but it only covers content from BBC1 to BBC4. So whilst very good, it's limiting.
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Interesting
Hameiri 14th Feb 2011
The top 5 shows are from broadcast TV. So, if you have an antenna, you have them for free.

Add TiVo, and you can record them for when you want to watch them. TiVo will also get you Amazon on Demand and NetFlix.

Add a PS3 and you have the Sony Store and Vudu. This is pretty much my setup.

I have a Sony VAIO laptop, but cooler would be a Mac Mini added to your home theater. Then you can get anything that's on the internet.

Yes, you miss out on some stuff, but you'd be amazed how much you actually get this way.

Freedom, freedom, freedom, freedom.

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