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Posted by: mikedup, March 16, 2010, 7:27pm
Turns out Bill Virgin, longtime radio columnist with the defunct print edition of the Seattle PI, has surfaced again as a weekly business columnist with the Tacoma News Tribune.
Reviewing his recent Sunday submissions, only one is broadcast-oriented .. and that is regarding Internet-based Television.  We reproduce it here, and say one more time, thanks to Bill for his many years of radio columns.


Web creates a new drama for television
Bill Virgin
TACOMA NEWS TRIBUNE

Published: 12/13/09 7:48 am

The college football fan who was without cable service during the most recent season need not have despaired of being limited to whatever games the broadcast networks might throw at his rabbit-ears-equipped television set.

Armed with no more than a high-speed Internet service, a computer and access to the Web site ESPN360.com, that fan could choose from a slate of more than a dozen games on any Saturday, sometimes with a half-dozen or so airing simultaneously.

Commercial break on one? Flip over to another game to see how it’s going.

Missed the game live? Watch the full thing on replay – or if you only want the good stuff, watch just the key or scoring plays.

It’s a wonderful playground for the sports fan, but as one is toggling from one game to another some potentially troubling thoughts begin to emerge.

Not troubling to the viewer, mind you, who is happily lapping up this buffet of pigskin offerings, but potentially troubling to both cable companies and Internet service providers.

After all, the football fan who is consuming sports programming this way is not paying the cable company, which is paying to carry programming from networks now offering that programming through their own delivery channels via the Web.

But he is chewing up a lot of bandwidth to stream real-time video to his computer, far more than he would if he were sending e-mails or placing on order with an online catalog retailer, even though those customers are paying the same amount for different levels of usage. That’s bandwidth capacity the Internet provider will have to pay to install and operate as more consumers turn to online video.

And they will, including those who have not the slightest interest in sports. They already are. Miss this week’s episode of “CSI”? You can find episodes of that show and dozens of other current and past series on CBS’ own web site. Or you can watch shows from multiple networks on Hulu. Or you can watch movies online from Netflix, instead of waiting for them to be delivered by mail. Or you can go searching for obscure or odd video clips on YouTube.

So are the cable companies and Internet service providers and outfits that do both, like Comcast or Tacoma’s municipally owned Click Network, in a panic over changes in the way we watch TV?

As with so much else in life, the answer is a lot more complicated than a one-word, or one-column, response.

Mitch Robinson, Click Cable’s marketing and business operations manager, says online viewing is going up – but that’s not necessarily at the expense of traditional TV viewing. What appears to be happening is that people are adding viewing hours to their day, watching online at times of day when people don’t normally watch television anyway, such as at work. One example from this past week: A spike of daytime traffic on the system as people watched the memorial procession and service for the slain Lakewood police officers.

And while programming companies are finding new channels to deliver their content, they’re not looking to cannibalize the ones they’ve already got – like cable. “They want to protect a variety of revenue streams,” Robinson says. “They want any revenue stream they can get but they don’t want to get rid of any revenue stream either.” Cable services provide a reliable stream of revenue, which those programmers might not get if they relied solely on marketing directly to consumers.

Nor are system operators fretting that increased online video viewing will snarl their networks to a standstill. Comcast spokesman Steve Kipp notes that because of technologies such as buffering, online video is “not as huge a drain as you would think” on capacity.

Both Comcast and Click have monthly caps on customer download volumes (250 gigabytes). Says Robinson, “99 percent of customers couldn’t get close to the cap if they tried.”

But change is occurring, and industry players – from programmers to cable and Internet system operators – are trying to figure out how to get ahead of those changes. One strategy is to focus more on what’s carried over the system, using those offerings to attract customers. That’s why Click makes a point of emphasizing its local programming. That’s why Comcast offers access to ESPN360 for its high-speed Internet subscribers, and it’s why Comcast recently signed a huge deal to acquire a majority stake in NBC Universal.

All of this may not mean much at first blush to the consumer who wants an hour or two of televised diversion in the evening and has come to expect near infinite choices in that diversion as a birthright.

But TV has already been radically changed from the not-so-long-ago days when the choice was three over-the-air broadcast channels, take it or leave it. The viewing public has proven itself quite adaptable to the new TV technologies over the last three decades.

Given the possibility of technologies, programming choices and delivery options we haven’t even imagined yet, there’s going to be at least as much drama going on behind the screen as what’s appearing on it.


Bill Virgin’s column on business and economics appears Sunday in The News Tribune. He is editor and publisher of Washington Manufacturing Alert and Pacific Northwest Rail News. He can be reached at bill.virgin@yahoo.com
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