It’s Here: The Internet on TV

What’s now more clear than ever is that the Internet will soon be everywhere: on mobile devices (as is already true), in cars (see Ford) and, finally, in the living room. I’ve been wanting to write something for a long time on the Internet on TV and its potential impact on cable companies. CES makes it unavoidable.

Internet content is coming to TV very quickly:

Netflix is now available directly to TV and indirectly through many set-top boxes. Microsoft in its keynote at CES last night spoke a fair amount about Internet or PC content on TV (as well as social media features of Xbox Live).

Cut to three years from now: all new TVs feature some built-in Internet capability. Those that don’t offer it can be paired with one of several set-top boxes that bring the Internet and Internet-type services to TV.

What happens to cable cos? They become the next in line to lose revenue and see subscribers abandon ship.

Most of what’s on TV is simply garbage and people are increasingly frustrated with paying $60 or more per month for it. Bundles that provide Internet, TV and phone may save subscribers because there will be huge inertia around making changes under those circumstances. In addition, unique content not otherwise available online (e.g., sports) may encourage some people to hold on to cable TV subscriptions.

It’s clear, however, that the TV is becoming just another screen that provides access to content and, increasingly, online services.

So the combination of Hulu + Netflix + YouTube, iTunes, combined with Facebook, online gaming, email, search, etc., will represent more than enough “entertainment” to satisfy most people. Goodbye cable!

The dispute between Fox and TimeWarner cable is indicative of the battles to come as everyone scrambles for more revenue. And such battles will likely fuel increasing cable bills to consumers. That in turn will only exacerbate what I’m describing.

Other thoughts . . .

Yahoo!, Samsung and others are creating widgets or apps for TV, making the approach similar to mobile.

Here’s an interesting, related story about AT&T selling local ads into U-Verse cable TV:

AT&T plans to begin offering local ad insertion opportunities for its U-verse TV service this year, a top company executive said Tuesday. The real estate will resemble what cable operators offer advertisers for local spots on cable networks they carry.

For U-verse, marketers apparently would be able to thread ads into homes in the approximate 120 markets in 21 states that the telco TV services. Large markets include Houston and Atlanta.

This is very much like Comcast, which has a large local sales force. AT&T already provides yellow pages content on U-Verse but local publishers generally should plan for the day when TV becomes a meaningful distribution medium for local (online) content and advertising.

The Internet on TV is not here in the same way that mobile is today. But it’s coming.

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18 Responses to “It’s Here: The Internet on TV”

  1. neal Says:

    nice post. could not agree more. hope all is well.

  2. Mike Stewart Says:

    Huge Impact on Local Search….. that was an obvious comment!

  3. David Mihm Says:

    I have been waiting for this FOR YEARS. Give me a Netflix subscription and an ESPN feed and I’m good. Cable companies, like the YellowPages, have not recognized the disruptive power of the Internet soon enough. They should have been offering customized, a la carte packages a long time ago, and now they’re going to get shut out of the online advertising game because of it.

    All that being said, Comcast has terrific customer service, and I AM willing to pay a premium for that.

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  6. troy Says:

    I just canceled my comcast cable and will be watching TV over the air or the Internet. Most cable content is like our food, make it as cheap as possible so you can consume more junk.

  7. Mike Stewart Says:

    I once suggested to Idearc to get packages for YP reps to sell SuperVideo spots (if only they commit to Better Video quality) on FIOS TV. With the challenge to push double double trucks it makes even more sense. They also need a cable video search channel with CPV and call tracking……stick that one next to gov access….lol

  8. John Wilkes Says:

    Great in theory. The question is who provides those highspeed data pipes into the home? The same folks charging that monthly content fee (cableco’s & telco’s). Delivering HD content over a broadband connection requires a tremendous amount of bandwidth. Spread that across the masses and you’re talking a large outlay in capital improvements. The cable and telco folks aren’t going to let you “cut” the cable without extracting their pound of flesh. If we’ve learned nothing else, content nor the delivery of it is free.

  9. Greg Sterling Says:

    If you pay for Internet access and have a set-top box (e.g., Wii) you’ll be able to get Netflix on TV. In our case that means a $9 Netflix subscription and $35 per month on Web access that we pay for anyway.

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  17. Patricia Says:

    Excellent post! As you say internet on tv has become part of the telephone company packages, not only because it keep you connected to the world, but beause it plays an important role on local sarch engines.

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