osewalrus (osewalrus) wrote,

Link Harvest: Economist on Cable Broadband priced for video

This article in the Economist asks the question -- given how much cheaper it is for cable to upgrade their capacity by installing DOCSIS 3.0, why aren't they offering blistering speeds at low prices? Ans: According to the article, because doing so hasten the decline of their video subscription service by allowing an increasing number of subscribers to "cut the chord" and not get cable service -- opting for various other online delivery systems instead.

The article suggests that cable is already too late to stop this reversal. But this ignores the "TV Anywhere" plan pushed by cable operators. One can get a taste of it at Fancast, a service offered by Comcast. If you can prove you are a cable subscriber, you can access the content.

This leads one to the next question: if this is the case, why would AT&T and VZ play along? Why not press their advantage by eliminating cable's core market (video). My answer: They are dumber than dog poo. Or, more accurately, they are hung up on the fact that they have paid squindoodles of dollars to get cable content, and will not lightly discard that investment. AT&T and VZ believe they can evolve into competing video services -- with the added advantage of tying their content to their superior wireless networks. So they will take on the cable boys on cable's home turf because they believe they can (a) win this game, and (b) that they have spent too much money preparing for this fight to allow the value of video subscription services to become diluted.

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