TWC and Fox in the new year

As of this writing it appears that the game of chicken that Time Warner Cable and News Corp have been playing is likely to end up with the two splatting into each other at high speed. News Corp wants more cash for carrying its popular TV programming, including US college football bowls and sitcoms such as It's Always Sunny in Philadelphia. Time Warner Cable (now independent of parent Time Warner) claims it would have to pass along $1 per subscriber and is leery of setting a precedent that the other major TV networks could then use to their advantage.

So far there has been no agreement and there's every possibility that Fox channels such as FX, Speed, Fuel and Fox Soccer Channel -- but not Fox News or Fox Business, which have separate contracts -- could simply go dark to TWC subscribers at midnight tonight.

So what does this have to do with the web? For one thing, TWC is also a major ISP (full disclosure: they're mine, in particular). For another thing, Hulu (part-owned by Fox) will be happy to show you Sunny and other FX shows (not sure about the sports), whether over TWC's pipe or someone else's. That's particularly interesting since Hulu is supported by ads, and declining ad revenue is one of the reasons Fox wants to charge cable companies like TWC more. Another might possibly be that Fox wouldn't mind cable subscribers dumping cable in favor of an online service Fox has a piece of.

Nah.

Cox and cell phones

Frankly, I'm not up to speed on this one, but I saw it float by and thought I'd mention it. Cable provider Cox Communications is looking to get into the cell phone business. Since like most cable companies they're already in the broadband internet business, and they also provide wireless internet, this seems like a bid to expand its presence into yet another means of delivering bits.

I have no idea whether this will work. If it does, you've got one-stop shopping for pretty much everything people do with bits these days and it's a brilliant coup. If it doesn't you've got a company with more fingers in pies than it has fingers and it's a colossal blunder. Judgment will be delivered in retrospect, as usual ...

[The Wikipedia article on Cox calls it the third largest cable provider and the seventh largest telecoms provider in the country.  Looks like it worked out OK.  Even if on a later sweep through Cox is defunct, I don't see how you could blame it on the decision to enter the cell phone business. --D.H. May 2015]

Netflix, content and pipes

Previously, I pondered what cable companies would make of Netflix's new set-top box [reviewed here], which would seem to compete with existing on-demand video services, but also drive up demand for broadband internet. Hardly was the virtual ink dry before I ran across this item: Time Warner, under pressure from shareholders, is spinning off its cable business and is now, according to one analyst, "headed toward being a pure content company."

So, at a guess, and keeping in mind that besides not being a lawyer I'm also not a financial analyst, this might make everyone happy. Time-Warner gets to distribute its content however it likes, including via Netflix if that makes sense. Netflix sells boxes and rents movies, and the cable arm should do OK as long as it can sneak any money it loses in on-demand rentals into higher prices for its broadband service -- perhaps by making sure that the "regular" broadband service doesn't carry Netflix's movies quite as well as the "premium" version.

We want the world and we want it reasonably soon

One of the nice features of digital TV is that you can decide when to watch a given program. This isn't a new feature, but digital delivery makes it a lot easier. Anyone remember VCR Plus?

In fact, you can time-shift in two different ways with a typical digital cable setup (at least, I think mine is fairly typical):

• Record a program and watch it at your leisure
• Get it on demand

In either case, you watch the show when you want. The difference is when the bits arrive. In the first case, they arrive when the broadcaster decides to send them. In the second case, they arrive when you ask for them.

What determines which way the bits get to you?

• Storage space: Your DVR will only hold so much. If you try to record everything you might possibly be interested in, you're liable to run out of space. This factor is rapidly changing.
• Broadcast bandwidth: There's only so much spectrum available. With infinite bandwidth, a provider could broadcast every piece of video/film ever made at 1,000,000x speed on an infinite loop and everyone could grab what they wanted as it came by [See this post for some implications of that].
• Copy protection: A provider might prefer that you not store a copy of the bits. Instead, it would prefer to send encrypted bits to a box that decodes them, without offering a ready way to store the results. This factor is also subject to change as the whole copy protection issue shakes out.
• Time sensitivity. A live event has to go out live. Even pre-recorded material can have more impact if everyone gets it at the same time -- the water-cooler effect.

The broadcast-and-record model doesn't require a data network. Traditional TV/Radio broadcasting, whether from towers or satellites, works just fine. VHF and UHF together comprise around 3GHz of bandwidth, readily available without building out a "last mile". At the moment, that's still quite a bit of bandwidth. Even if the broadcast is via a data network, there's no requirement that said network be connected to or behave like the internet.

The downside is that (for the most part) you don't get to choose when the bits are sent. But how much of a downside is that? It's not a problem for live content -- quite the opposite. It's not a problem for not-so-live content either, as long as you can still choose when you watch.

Again, the connection between receiving and watching has been loosening over time as storage gets cheaper and easier. Maybe this is just me, but if my favorite show comes in while I'm asleep and I can watch it whenever I want the next day, I've got no problem. On the other hand, if it's something that everyone just absolutely has to watch at a given time, that's essentially live content.

The upshot is this: Given ample cheap storage, it would appear worthwhile to broadcast anything new that lots of people want to see, regardless of whether they want to see right at that moment.

I haven't paid a lot of attention to satellite TV lately, having had cable for the past few years, but I could imagine someone shipping out a set-top box pre-loaded with a huge video library and space for plenty more. Only new content gets broadcast.

Live content comes in as it happens. Pre-recorded content comes in whenever the bandwidth is available. Everything gets stored on the box, using double-secret heavy encryption mojo. You can have whatever you want, and reasonably soon. The result would be pretty much indistinguishable from a cable set-up.

You would even have on-demand viewing. This difference is that instead of demanding the bits, you're demanding authorization to decrypt the bits (for a while, at least). You might well obtain the decryption key via the web, in which case the web handles the transaction, but the heavy lifting of moving large hunks of video around can happen elsewhere if that makes sense.

Such a scheme would also have all of the usual data-protection problems, notably including analog conversion, but that comes with the territory. Whether it's less secure than an existing on-demand service depends on just how good the double-secret heavy encryption mojo is. I can see content providers being nervous about putting the keys to the kingdom directly in the hands of millions of subscribers, however well protected the data may be. But on the other hand, isn't the whole point of mass media to get the bits to as many people as possible?