The Future of Television: The way we watch

The days of bundled cable channels are numbered. TV programing is evolving into more flexible and personalized distribution.

Kai Ryssdal: You may be listening to radio at the moment, or at least audio, however it's delivered to you. This week on the program, though we're all about television -- and the future thereof. Yesterday I was talking to John Moe of our Marketplace Tech Report at the Consumer Electronics Show in Las Vegas, and we were talking about how there's a whole new breed of smart TV's coming -- that are, basically, giant computers hooked up to the Internet. But hardware's just one part of the puzzle. Think about what goes on the screen and how we pay for it.  

Jennifer Collins reports.

Theme for Monday Night Football

Jennifer Collins: We all know what that means: It’s time for Monday Night Football on Google.

Wait, I'm getting ahead of myself. That's the music for Monday Night Football on ESPN. But Google's day could be coming.

Mark Suster: I think they'll bid on the NFL rights in the next five years.

Mark Suster is with the venture capital firm GRP Partners.

Suster: And I think that if you can find an internet company broadcasting NFL via internet, you'll see the industry crumble.

Now Suster may be getting ahead of himself. The crumbling industry he's referring is cable and satellite. They still have around 100 million subscribers in the U.S., and generate around a $100 billion a year in revenue. But competition is changing the way we watch and think about television. Forrester Research predicts the number of pay TV subscribers who cut the cord will continue to increase next year. 

Mark Suster: When consumers have choice, and distribution options open up, these huge fat industries with big profit margins start to collapse and new players tend to emerge.

New players, and some old ones with new services, are streaming video to an array of devices from TVs to tablets to smart phones. YouTube will launch 100 channels this year that range from Car and Driver Television to something with Madonna.

Madonna: All the world loves a stage.

Netflix is taking on HBO and the networks by offering original shows. There's Hulu and Vudu and Amazon and Apple. And then there's comedian Louis C.K. His recent Internet experiment sent a shiver through the entertainment industry.

Louis C.K.: Don't text or Twitter during the show, just live your life. Don't keep telling people what you're doing.

Louis C.K. posted a video of his standup show at the Beacon Theater in New York. He sold it for $5 online. Over 200,000 people downloaded it. He made over $1 million, not a dime to a studio or distribution company.

Louis C.K.: I'm not like you. I'm not. I'm not.

There aren't many Louis C.K.s out there, yet. The more common model is a company like Break Media, which produces and distributes its own video. This is one of Break's first hits: A girl eating a praying mantis.

Praying Mantis: Go! Oh! Oh my god!

Break bought in more than $50 million in revenue last year. It distributes videos online and through apps on smart TVs and TV set-top boxes.  CEO Keith Richman is out to create a network made for the streaming era: videos on as many outlets as possible supported by ads.

Keith Richman: We want to have deals with whoever will influence that future world.

Because like everyone else, Richman knows the days of forcing people to pay for channels they don't want just to get the ones they do are coming to an end.  

Richman: If you're a channel that people pay for and they don't know why, you have a very short lifespan.

Robert Kyncl: You will have a lot more choices than you do today.

Robert Kyncl is the vice president of content for YouTube. He’s overseeing the 100 new channels on the site.

Kyncl: And when I say choices, I don't just mean a lot of video choices -- even though that's true as well. But also different ways to pay and different ways to have your content bundled.

Kyncl says there will be subscription services. There will also be individual TV shows for sale, there'll be free video and there will be packages of channels. And eventually, your TV may be smart enough to serve up only the things you want to watch when you want to watch them.

I'm Jennifer Collins for Marketplace.

About the author

Jennifer Collins is a reporter for the Marketplace portfolio of programs. She is based in Los Angeles, where she covers media, retail, the entertainment industry and the West Coast.
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Though would appear that there is in incentive for local cable companies to drag their feet in giving you the bandwidth needed to fire them, in reality the local cable companies I have discussed this with are eager to simply sell bandwidth as the cost of delivery is so much less and the profit margin is something they may be able to make a living with. Since they do not make content, but have to buy it then resell it, it would be easier for them to simply sell access to a global content system and let you figure out the details. In the end, they still get a certain profit per month per subscriber.

I don't commonly create accounts for drive-by comments, but this one seemed to merit it, and, well, you're Marketplace. :-) (Worse: your comment engine malignantly eats blank lines. Suck it; you can read past the <P> markers.)
There are two fundamental problems that this piece didn't address, in all it's excited gee-whizzery, and they're pretty big problems.
One is the "compatible color" problem: Content providers are *so* paranoid about people being able to watch things on more than one device, and save them legally in keeping with Sony v Universal, that they continue to purchase newer and newer legislation like DMCA, and the upcoming Internet Decimation bill SOPA -- which is *so* bad that Google, Facebook and Wikipedia are just some of the websites seriously considering a full-day blackout the day before Congressional debate, to get across to people what problems that bill could engender if passed.
In consequence of this paranoia... we have a TV over IP delivery environment where *the program service controls what type of television you can use*.
That didn't play in the 50s with color TV, and I assure you that -- as soon as Congress gets over thinking it's cute to be ignorant of the Internet and how it works -- it ain't gonna play now, either.
More importantly, the NFL video rights contract was, I'm told, just sewn up for 10 years, so apparently the vulture capitalist you quoted doesn't listen to Stephan Fatsis real often. :-)
Whether the Internet backbone can *handle* 35-40 million 1080p live streams to *network* quality standards is a completely separate question, about which I'm not completely sanguine *now*. Later, probably, yes... as soon as we fix the "need to support 40 delivery protocols" problem.

It will be great to get all my TV streaming. But wait! I have a crappy, albeit "broadband", connection from Comcast, which now coincidentally owns NBC. Maybe Comcast will make sure I don't get all that competing content anytime soon?

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