Why The Internet Is Not Disrupting TVOct 26th, 2010 | By James Lewin | Category: Internet TV
Mark Cuban shares some interesting thoughts at his blog on why the Internet is not disrupting TV:
If my memory serves me right, the common thread among industries (disrupted by the Internet) is that they all sold their products ala carte.
Music – By the CD
Newspapers – Single Newspaper (Dallas Morning News) sold by copy or subscription
Magazine – Single Magazine (Newsweek) sold by copy or subscription
DVDs – Single copy.
Blockbuster – Rent each DVD
In each of the above examples, the primary revenue stream from the product came from ala carte sales – the purchase of a single product.
Cuban goes on to compare this to TV:
TV is sold by aggregators who sell TV in bundles. Not ala carte.
Pick any TV distributor. They aggregate the channels they want to sell into bundles and sell them. From basic service to full service with every channel available. If you want to buy PPV or VOD content, you must first be a subscriber.
Look at Netflix. They sell NOTHING ala carte (like I said, smart as shit). You have to subscribe to their service, then you can select the content you want to watch.
Look at Spotify. Pay by the month or don’t play.
Cuban’s argument makes sense. It’s will be hard for devices like Apple TV and Google TV to disrupt traditional television when many traditional TV sources won’t make themselves available on the devices.
Cuban fails to take into account, though, the broader trend away from static, sit-back content towards new media that is more social and interactive. People are already dumping cable because they’re spending their time watching Internet TV – or using the Internet to do something more active with their time.
If Apple and Google try to compete against television, they’ll never win, because they’ll only have a fraction of the content to offer.
If they look at television as part of a broader variety of Internet activities that can be delivered to your living room, though, they can become the super-aggregators that Cuban is talking about – delivering Internet video, social media activities, video calling, games and, yes, television shows to your big screen.
Can Apple TV and Google TV compete with traditional TV? Leave a comment with your thoughts!