The 2009 Cable Show - Debunked

Much of what you are about to read is going to be my regurgitation of the information I consumed from reading the Multichannel News coverage of The 2009 Cable Show. The keyword is much, and not all, but I do have to confess, if you are interested in keeping up with the Media Industry, Multichannel News and NAB365 have been doing a phenomenal job of covering the media convergence, and to a lesser extent, The New York Times technology section has been doing a decent job.

Anyway, The 2009 Cable Show, has kicked off and already many new advancements in cable have been announced. Being announced, however does not mean these advancements will see life, just that the companies that are currently in development with them and are hoping these products will be released. The conference's keynote speaker signaled the event by saying,

"The truth is we really don’t know what the future holds . . . we have merely an imperfect glimpse of what a truly connected nation would look like. But it is an exciting vision, and our industry fully intends to do its part to lead.
Competition and our willingness to invest and to take risks have made every aspect of our business more innovative . . . more nimble . . . more responsive to and focused on the consumer."

In these two sentences, I am calling shenanigans on being "more responsive to and focused on the consumer" and "our industry fully intends to do its part to lead," I could call it on my aspects of what is said, but then I'd be here all night. Everything the cable industry does is for the purpose of getting its consumers to give them more dough. They offer greater conveniences and services for more money, not because they care about their consumers in particular, but because they care about their wallets. But, they are all for-profit companies so what else can be expected. As for leading the industry, the cable companies are currently trying to play catch up. Many of the cable companies developed broadband Internet in order to generate more revenue, without considering the consequences on the industry and on other industries. They didn't fully understand the power of the Internet and they still went about unleashing it to their consumers. Now they are scrambling to protect their industry as others seem to be collapsing. I digress.

Cox Communications used the show as a platform to announce its new broadband service which will offer 50Mbps downloaded and 5Mbps uploaded. This service will run users around $139.99/month depending upon the market, for example Lafayette Parish, La. will only pay $89.99/month. They are doing all they can to get their consumers the best their money can buy, especially considering the 50Mbps down a user can get with Verizon is $45/month. Not that Verizon is much better considering the Japanese pay the equivalent of $22/month for 100Mbps down. Why do they pay so little? Instead of cable and DSL lines being considered a utility, their companies are forced to rent the lines to competitors, which act as another revenue source for the company making their service cheaper. That is what I call looking out for the consumer, not what Cox and the other American companies are doing.

Also debuted at the show, Macrovision's Tru2way DVR and Sprint offering the ability for subscribers to view caller ID, voicemail alerts, and such, on their TVs. To me, the Tru2way is a bit deceptive as it gives users the ability to watch DVR recordings on multiple boxes in one house. The user can record on one box, and watch on another and other similar feature. I'd assume with the name of Tru2way a user could participate in 2-way communication with the program. Instead, the user can do something I can already do with my laptop, except I can also leave my house with my laptop and watch the program then, but I guess they need to worry more about piracy than giving their customers that kind of convenience. As for Sprint's new advancement, does anyone else see Google Voice and/or Skype playing a pinnacle role in influencing Sprint, or am I just grasping for a comparison?

The greatest announcement that truly shows how dedicated the cable industry is to being "more responsive to and focused on the consumer" is the announcement of Openet. Openet will work "behind-the-scenes" with two of the U.S. biggest cable operators to track consumers' data, voice, and TV viewing usage. In other words they will be spying on you to see who you call and tracking every move you make online. They say it is so they can "improve the subscriber experience" by seeing what they are interested in. I think I will translate that into, "We really want to help out the RIAA and if the government wants to participate in warrant-less wiretapping again, we'll be prepared." Face it, those are going to be its uses, tracking who is pirating music and/or movies and TV shows and..well, maybe I am getting too 1984 with that second part. This isn't meant to service their subscribers, unless that is a new name for people/companies that what to see what broadband users are doing.

Anyway, it seems the keynote speaker at The 2009 Cable Show is a little out of touch with the rest of the industry, rather that or they didn't inform him they were no longer focusing on the customer's convenience and, instead, more on controlling their usage of media. I suppose this is a good point to leave off, after debunking the "goals" of the cable industry with their own announcements of advancements.

P.s. I am still trying to figure out if I should use this or my blogger, so I am posting the same content to both.

The Social is the New Expert

A New York Times article that ran on March 30th announced that Microsoft was pulling the plug on Encarta. As a web designer I hold no feelings other than loathing towards Microsoft, thank you very much Internet Explorer, so it is pleasing to see that one of Microsoft's ventures has failed. As someone who likes learning, this kind of worries me. Wikipedia is the leading online encyclopedia, if you are unsure of what Wikipedia is, well, you haven't been on the Internet long. Regardless, it is a social encyclopedia in which anyone can contribute and often disputes over the accuracy of the article are solved by majority rules, not what experts say. It is a really cool concept to give the power to the masses, but the legitimacy of the information is a little unnerving. Then again that still hasn't stopped me from using it.

The Internet is changing not just the way we gather information, but by whom the information is given. Information can be the facts we need for our research and I will even include the entertainment we seek, that is a form of information I suppose. It is creating a world where the experts no longer dictate to the people what is true and what is false, a societal truth is what is important.

Many cable companies are beginning to question their free online streaming model. The free streams are creating bad habits "that will eventually lead to the 'Napsterization' of cable and destroy the economic model necessary to create such shows." Unlike broadcast stations, cable companies rely on both advertising and subscription revenue. By going to the web they are losing the subscription revenue and web advertising isn't promising enough to support their shows. The $60 billion a year generated by subscription costs greatly outnumbers online advertising hitting the record high of $23.4 billion in 2008.

Though this tactic is being implemented to help generate the income needed to produce the shows viewers see on cable, it might be too late, if it would have worked. People are going to look at the Internet like they look at cable, they are paying for a service, so they feel like they should get all that this service should offer. If they can't get these online streams for free, like they do now, then some may try to find alternatives, Independent sources, or worse yet for the cable company, some will try to pirate the shows. Now the channel has lost the potential for advertising.

Looking at the worst possible scenario for the cable stations, if this does indeed cause them to collapse, then where will people get their video entertainment? The only other sources I could see are the broadcasters, who aren't doing too well either, or from independent and/or amateur producers. The problem is there is money online, but it is much more spread out than on other media. This may very well lead to the lower budget productions from society over productions from Hollywood or NYC.

Last year 62% of online Journalists felt the business was going in the wrong directions. This year the number is down to 54%. Still, the greater majority of them fear for the future of Journalism. Why shouldn't they? There are currently talks debating if newspapers should be given non-profit status in order to keep them afloat, again, the broadcasters are suffering, and some still fear that online advertising revenues are not enough to support an editorial staff. If I were going to look at the worst case scenario, which I am, it would seem like blogs are going to be the wikipedia of the news world. The biggest problem behind this is lawsuits. When a journalist breaks a story about a company that was devastating to their image or industry, companies will often try to sue. Without the backing of another company's law team, how will the normal person be able to afford to defend themselves from such a lawsuit. For a great example of what I mean, watch The Insider.

To straighten things out, I don't believe either of the hypotheticals I stated will happen, the cases are too extreme. Big production companies will survive, even if many of them close their doors. Online news will not completely fall into the hands of citizen Journalism, and if so, I can guarantee that there will be some sort of federation of citizen journalists formed to not only protect these people from such lawsuits, but to also check into the legitimacy of the journalists.

The point I was trying to make is the power is leaving the hands of the few and being placed upon the shoulders of the many. It is kind of exciting. But, unfortunately, as the saying goes, "The masses are asses," the people will find away to screw up having this power and it will be dstributed back to some form of Oligopoly, kind like our current media industry.