CES: The Future on TV
One of the best articles on CES I’ve read in the past week was published before the show even opened. Of course, if only I had read the WSJ that morning instead of packing, I might have been better philosophically prepared for what was to fall into my purview. The article, The Future On TV, by Holman Jenkins (sub. may be required) reminds us that innovation has a natural and powerful role in creatively destroying the franchises built around previous generations of technology.
Holman argues that the role of the Internet-Enabled TV is to dis-intermediate the network from the content providers and reset the balance of power in favor of the content producers. Users won’t need the cable company, or the phone company, or the satellite company to watch movies, scripted shows or even reality TV. These will be available from NetFlicks, Hulu.com and a half-dozen other TV Internet-broadcast experiments, for fees so small, that it makes the cable/telco/satellite network companies cringe.
Now that the local broadcasters have digital bandwidth to work with, they can focus their resources on the two truly perishable programs – sports and news. So what exactly do I need a phone company, cable company or satellite company for? BANDWIDTH. And, that’s about it.
But surely, this won’t just be about reducing consumer spending?
If you had told me a decade ago that I’d be spending $300/month on communications and entertainment I would have laughed you out of my office… sadly, I do spend that amount and a recent study now in production at Brockmann & Company says that I am not alone. Instead of total disintermediation, I suspect the broadcasters and Internet companies will discover a revenue model that doesn’t destroy the cableco/telco/satco network, since like the scorpion riding the frog’s back to cross the river, Internet companies need somebody to provide the infrastructure. Sadly, this yet-to-be-discovered model, will involve cash mining from consumers not unlike the wonders of modern communications and entertainment services have managed to do over the past three decades.
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