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Who are we kidding? Of course it’s Netflix vs. cable (Dinosaur Media DeathWatch™)
Gigaom ^ | June 14, 2011 | Janko Roettgers

Posted on 06/15/2011 1:05:37 PM PDT by abb

Ask Netflix about cord cutting, and it’ll tell you: “It’s not happening, it’s not anything we are causing, cable and Netflix are complementary.” Then take a look at the actions of service operators, cable networks, consumers and even Netflix itself, and you’re going to see a decidedly different picture: Cable and Netflix are competing for the same eyeballs, the same money and the same TV real estate, and the fight is getting tougher by the day.

Not convinced yet? Then consider this evidence:

Consumers are ready to jump ship. Netflix users that stream the company’s videos to connected devices are twice as likely to at least downgrade, if not outright cancel their cable TV subscription than they were just a year ago, according to a new study from The Diffusion Group (TDG). Thirty-two percent of these Netflix users are thinking about calling their cable company. “Despite its rhetorical positioning, both Netflix and Pay TV operators have long been aware that there will come a point at which its services are not only dilutive to regular TV viewing, but antithetical to Pay TV subscription levels,” said TDG’s Michael Greeson. In other words: In the long run, Netflix will inevitably lead to cord cutting.

Content licensing is getting more competitive. Netflix Chief Content Officer Ted Sarandos revealed recently that Netflix is now at the table for pretty much any TV licensing deal. So why aren’t Netflix customers buying more content? Because some of the networks simply don’t like to share. Netflix would prefer cheaper, non-exclusive licensing deals, which would make it possible to get more bang for its buck. However, HBO and increasingly Showtime are insisting on exclusive content to prevent subscribers from jumping ship.

Many observers thought Netflix wanted in on this game when the company bought the rights to its first-ever exclusive show House of Cards this spring. Sarandos, however, said that it was exactly the other way around: Netflix was getting concerned that it would get shut out of too many deals for attractive serialized content, which is increasingly going exclusively to programmers like HBO, so it saw itself forced to act.

Cable companies castrate their TiVos. A number of cable companies now offer their customers TiVo-branded DVRs that offer access to all kinds of additional online content. But TiVo users who buy their devices at retail will be able to watch videos from Netflix and Hulu Plus with these machines, while customers who rent the same DVR from their cable company won’t have access to these two services. The logic? Netflix could get people to ditch their premium channels and ignore cable VOD.

Netflix is dominating every screen. Network operators are trying to bring TV everywhere, but they often must feel like the hare racing the porcupine: Wherever they look, Netflix is already there. The company’s service is now available on more than 250 devices, and Netflix is getting more aggressive about dominating every single screen. The latest ploy is a dedicated Netflix button on your remote control, which puts it in direct competition with your cable guide. That raises the question: Do you want to browse through thousands of channels, or simply access Netflix?

Incumbents are putting a cap on it. If you’re a network operator, how do you keep your customers from canceling premium pay TV services to watch everything online? Canadian ISPs seem to think that bandwidth caps are the answer, and they’ve been enforcing strict data diets for years. ISPs that charge consumers up to $2.50 per GB once they exceed caps as little as 2 GB per month have been a real problem for Netflix north of the border, forcing the company to default to SD-quality streaming for all Canadian customers.

There’s been some movement with regards to bandwidth pricing in Canada in recent months, but the conditions are telling: Shaw recently introduced generous 1TB caps and even unlimited data plans, but those are reserved for customers who have a pay TV subscription as well. Bandwidth caps in the U.S. are generally higher, but not really that generous either, especially if you’re a heavy Netflix user.


TOPICS: Business/Economy; Culture/Society; Extended News; News/Current Events
KEYWORDS: advertising; cable; dbm; movies
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To: antiRepublicrat

-—————Dark fiber mainly refers to the overcapacity in addition to individual lines not being used.-————

Ok then. Unlit must be the word I was looking for.

—————There was a fiber laying frenzy during the dotcom boom, so there’s a lot of extra fiber cable around.—————

That’s what I remember reading about, I think.

-—————I don’t know about 90%, but it is significant for sure.——————

Which is the bottom line.

In the search for solutions outside of government, this is surely a piece of the puzzle.

Instead of turning to marxists to solve this problem, I’d prefer to urge the telcos to make greater use of the existing fiber infrastructure.


101 posted on 06/15/2011 6:09:09 PM PDT by Halfmanhalfamazing ( The liberal media is more ideologically pure than Barack Obama)
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To: AFreeBird

I’m ready to cancel for another reason. I get 4 movies a month (used to get 6) and every since I cut it to 4 a month 3 months ago, it takes netflix a WEEK to credit my account and send another movie. I can mail 1 movie back on Monday, Tuesday, Wednesday, & Thursday and netflix will not credit my account till the following Tuesday for all 4.

I used to praise them to no end but come June 23, I plan to cancel I have had to report them lost for the past month just to get credit


102 posted on 06/15/2011 6:51:26 PM PDT by packrat35 (America is rapidly becoming a police state that East Germany could be proud of!)
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To: Mike-o-Matic

Emanuelle in America is definitely what most would call x rated. Note the NR (not Rated) ny Netflix.

http://movies.netflix.com/WiMovie/Emanuelle_in_America/60028934?trkid=2361637


103 posted on 06/15/2011 7:11:42 PM PDT by packrat35 (America is rapidly becoming a police state that East Germany could be proud of!)
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To: packrat35

Hm, that’s at least one that seems to fit the description, I guess.


104 posted on 06/15/2011 7:31:01 PM PDT by Mike-o-Matic
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To: Mike-o-Matic

There are several more, most from foreign sources, none of the outright xxx advertised porn from the US.

Also some of their R rated are very very close to porn. I won’t give you the titles as you are not interested in these types of movies.

Netflix is a great source of older and hard to find movies for all tastes. My beef with them now is they won’t credit my account for a week. I have had to report them lost the past 4 weeks to get credit.


105 posted on 06/15/2011 8:05:01 PM PDT by packrat35 (America is rapidly becoming a police state that East Germany could be proud of!)
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To: Halfmanhalfamazing
Instead of turning to marxists to solve this problem, I’d prefer to urge the telcos to make greater use of the existing fiber infrastructure.

That isn't the problem. This is mostly backbone and inter-city stuff. Load problems come because ISP's didn't build-out their local networks enough to support the bandwidth they've sold to customers. You know that when they tell 10,000 people they get 10 Mbps, there isn't 100 Gbps available. But now that enough customers are actually using their 10 Mbps, there's a problem. The lie could only last so long. So far the private sector solution has been to increase local capacity a bit, but also to crack down in some devious ways on those customers who dare to use their contracted bandwidth.

I have to give kudos to Time Warner Cable for honestly playing with different pricing structures, and to Verizon for supporting landline net neutrality (although VZW doesn't like it for wireless). Unfortunately, they're only numbers 3 and 4 in the market. The main culprits have been numbers 1 and 2, Comcast and AT&T, and obviously they tend to be worst in places where they have a monopoly.

106 posted on 06/16/2011 7:08:08 AM PDT by antiRepublicrat
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To: perfect_rovian_storm
These statements always amaze me. When has this happened? Why WOULD this happen?

Probably because heads of telcos have said that Internet companies need to "pay their fair share." That means the company who wants to go on the ISP's lines needs to pay the ISP. Logically, companies that don't pay don't get through quite as well, or at all.

I think what you probably will see are bandwidth caps and plan changes.

That's fine. My main problem so far has been when companies advertised X bandwidth, contracted with customers for X bandwidth, and then penalized customers who actually used X bandwidth as "abusers" of the system. That and when X protocol used a lot of bandwidth, the ISP interfered with the traffic.

I'd rather see it done the non-neutral way and have Netflix sit down with the ISPs and work out a deal that would save both of their business models.

That's not the way the Internet works. Netflix is Level 3's customer to get the data out, you are your ISP's customer to get the data in. There is no direct business relationship between Netflix and your ISP. There are peering arrangements at the level of where the backbone networks meet, and that's a different and very complicated issue.

107 posted on 06/16/2011 7:29:01 AM PDT by antiRepublicrat
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To: antiRepublicrat
That's fine. My main problem so far has been when companies advertised X bandwidth, contracted with customers for X bandwidth, and then penalized customers who actually used X bandwidth as "abusers" of the system. That and when X protocol used a lot of bandwidth, the ISP interfered with the traffic.

Okay, so call your ISP and get your own line. Or just get a business account. Then, you'll be paying the full freight for your connection.

Oh, and thanks for the 'very complicated' lesson in 'how the internet works'. It's always educational to converse with someone ignorant enough of history to advocate for the government imposing 'neutrality'. Thanks for taking the time and as Abraham Lincoln would say: Thanks for removing all doubt.

108 posted on 06/16/2011 7:37:31 AM PDT by perfect_rovian_storm (We're stuck between Obama's policies that suck and his ineptitude that blows.)
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To: antiRepublicrat

-—————That isn’t the problem. This is mostly backbone and inter-city stuff. Load problems come because ISP’s didn’t build-out their local networks enough to support the bandwidth they’ve sold to customers.——————

I see what you mean. This isn’t a coast-to-coast issue. It’s a NYC-to-NYC issue.(for example)


109 posted on 06/16/2011 7:41:02 AM PDT by Halfmanhalfamazing ( The liberal media is more ideologically pure than Barack Obama)
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To: Halfmanhalfamazing

We’ve got fat coast-to-coast pipes. Locally a bunch of customers are connected by, say, cable. All that cable is centralized in a neighborhood connection, which goes upstream to another centralization, etc, then goes out on the backbone. Each of these connections has a bandwidth limit.

Try opening a command prompt. Type “tracert freerepublic.com”

How many items listed look like they belong to your ISP? That’s all traffic within your ISP before it goes out. This is the network that too many ISPs haven’t built out enough to meet the demands of the paying customers.

Dark fiber is normally bought by network companies to ship data from datacenters (a.k.a., the servers you hit on the Internet), with large companies to work with their own datacenters (Google), example to provide the network connectivity to the wireless carriers (that 3G has to hit the ground at some point), or they’re the guys your ISP gets its internet access from. This stuff is way above consumer level, the big guys. When a company actually buys the physical fiber, it’s usually buying hundreds or thousands of miles of it.

Right now there’s a network peering dispute between the long haulers and ISPs. Specifically, Comcast wants to change the traditional peering agreement with the Tier 1 (big backbone) Level 3 Communications. Such disputes are common, but this one is special since it was triggered by traffic from a specific source, Netflix, which competes with Comcast’s own offerings. Search “level 3 comcast peering dispute” for more info. But that isn’t really an issue of bandwidth, but money.


110 posted on 06/16/2011 8:12:26 AM PDT by antiRepublicrat
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To: Mike-o-Matic

I know that I’m not incorrect. Try Ken Park or 9 Songs. Both available for streaming, and both definitely hard core porn. Both recommended to me because someone in the house rated Dangerous Beauty highly.

Don’t even get me started on Netflix’s recommendations. You liked Gandhi so we’re recommending The Texas Chainsaw Massacre.


111 posted on 06/16/2011 8:46:53 AM PDT by Melas (Sent via Galaxy Tab)
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To: perfect_rovian_storm
Okay, so call your ISP and get your own line. Or just get a business account. Then, you'll be paying the full freight for your connection.

You pay based on what packages the ISP offers. For residential, historically the ISPs have decided to offer packages on the basis of X bandwidth for Y price. That was their decision. They then contracted with customers, X bandwidth in return for payment of Y dollars. To then not deliver X bandwidth for Y dollars by means such as I have mentioned is fraud, ISP officers should have been thrown in jail. Instead, they have partially succeeded in painting their victims as the bad guys.

The core problem is that the ISPs were running a version of the old-time over-investment scam. Think of a timeshare condo where there are 52 investor-weeks to stay, but you sold it to 100 people knowing that usually (for sake of argument) over half of them never show for their week anyway. You juggle weeks to make sure visits don't conflict, and you're okay as long as fewer than 53 people demand their visit every year. But when over 52 people per year actually come to visit, your fraud is exposed, you go to jail.

First P2P, and then Neflix, exposed this scam the ISPs were running. They were happy for years to take Y money for X bandwidth and only have to build the capability of providing X/10 bandwidth. Instead of building a second condo, they claimed the paid investors were freeloaders and kicked them out. And we're supposed to trust these people to be self-regulating under a free market?

112 posted on 06/16/2011 8:48:03 AM PDT by antiRepublicrat
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To: Halfmanhalfamazing; abb

He didn’t hit around it, he used it. Universal service has been an issue since long before net neutrality. This is simply the old idea of telephone universal service translated to the Internet, as he talks about using the already-existing Universal Service Fund for broadband (which the telcos don’t mind, since it’s even more government money in their pockets). Unless you can find a time machine, it has absolutely no relation to net neutrality enforcement.

Feel free to discuss it, but quit mixing up the issues.


113 posted on 06/16/2011 8:50:41 AM PDT by antiRepublicrat
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To: Melas

Guess I didn’t go looking for it. BTW, I agree, the recommendations engine isn’t very good most of the time.


114 posted on 06/16/2011 9:29:32 AM PDT by Mike-o-Matic
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To: Politicalmom

Ha. When I got home yesterday some ATT guys were chatting up the wife. We signed up and dumped COMCAST on the spot for that Uverse or whatever it is called.


115 posted on 06/16/2011 9:42:13 AM PDT by subterfuge (BUILD MORE NUCLEAR POWER PLANTS NOW!!!)
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To: subterfuge

I was thinking about it, but I asked around, and got some terrible reviews of AT&T’s customer service, plus my internet speed will drop drastically. I’m not a computer geek, so I don’t know how much that will matter. We have a lot of computers in the house, plus two Netflix devices.


116 posted on 06/16/2011 9:51:17 AM PDT by Politicalmom ("Obama has put the wrong gas in the tank of our economy."-Herman Cain)
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To: Politicalmom

My next move is to dump all pay TV and land line phones...that’ll teach ‘em.

I have a hard time any company could be worse than COMCAST.


117 posted on 06/16/2011 12:42:27 PM PDT by subterfuge (BUILD MORE NUCLEAR POWER PLANTS NOW!!!)
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To: Hodar
Brilliant reply.

To which it should be added that the shows which you select can be started and stopped anytime you please. Whereas the shows the cable network chooses must be started and stopped when they please.

Of course, the cable company has a solution for that-- another device to clutter your television stand for an additional monthly rental fee.

118 posted on 06/17/2011 8:02:10 AM PDT by Vigilanteman (Obama: Fake black man. Fake Messiah. Fake American. How many fakes can you fit in one Zer0?)
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