Internet video streaming services keep getting better — but we still haven’t seen one that could come close to dethroning the cable industry.
New this week: A new on-demand video streaming service from Amazon.com, which is an improvement over its previous “Unbox” video store. Nice selection, and great competition for Apple’s (AAPL) iTunes store. But in our brief testing, the video quality leaves a lot to be desired. And Amazon (AMZN) still hasn’t made it easy enough to watch their movies on your living room TV.
Also this week: LG finally put a price tag — $400 — on its new Blu-ray player that will be able to stream Netflix (NFLX) movies over the Internet to your TV. Too expensive for most buyers, we think. And anyway, Netflix’s streaming movie selection is still small and obscure.
So between those options, and Apple’s iTunes/Apple TV product, we think on-demand viewing is still cable’s game to lose. Why? Let’s start with two assumptions, which we think are reasonable:
- That most people still want to watch movies on their TV, not their computer.
- That people with hi-def TVs want to watch movies with good to great video and sound quality.
This is where the cable industry still has the upper hand:
- Every cable (and telco-fibre TV) subscriber has a high-capacity pipe running directly into their living room, designed specifically for video, and capable of streaming hi-def video with surround sound in real time.
- Each of the 38 million U.S. digital cable subscribers already has a set-top box hooked up to their TVs — most of which can handle on-demand programming, and many of which can handle HD video on demand.
- Extra bonus: The video you watch through your cable box doesn’t count against any Internet bandwidth caps your cable company forces upon you.
To be sure, cable’s on-demand programming libraries are still pretty thin: They don’t have as many titles available as Apple or Amazon — hundreds of movies, not thousands. But that’s a business hurdle they could solve relatively quickly — not a technical problem. And cable’s HD offerings beat the majority of Apple’s movies and all of and Amazon’s and Netflix’s.
Bottom line: As movie delivery shifts from disc to digital, a lot of companies are going to try to be the ones who deliver high-quality video content to your TV — Internet companies like Amazon, consumer electronics companies like Apple and LG, movie rental companies like Netflix, game console makers like Microsoft and Sony, etc. But so far, we think the cable industry — which already owns the pipe and already has a box in your living room — still has the upper hand.
Amazon Launches Video Streaming Service: Look Out iTunes, Hulu, Netflix
Netflix-Streaming Blu-ray Player Still Probably Too Expensive At $399
Are Internet Providers Making Broadband More Expensive To Protect Their TV Businesses?
Apple’s Living Room Archrival: Netflix, Or Comcast And Microsoft?
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