CES Wrap: Cable Feels Pretty Good
Apple’s new set-top ports video and music wirelessly from a PC to a TV. The latest Slingbox incarnation lets viewers clip programming from TV and email it to others. Should cable be trembling in its boots? Nah, says Oppenheimer’s Thomas Eagan. "We believe the new products and services announced at this year’s CES conference are more likely to act as a complement than a substitute for cable/satellite subscriptions," he said.
Instead, in a note to clients, Eagan raised more concerns about "the increased risk of Washington regulation heating up in ’07." Kevin Martin using CES to announce the denial of the largest MSO’s integration ban waiver petition did nothing to help cable’s relations with the FCC chairman. (Wonder if he’ll use NAB’s April confab to announce the denial of NCTA’s petition…)
Cox kept an interesting blog on show insights at DigitalStraightTalk.com/CES. "If there’s an overarching theme that I could detect thus far, it’s that companies are struggling to figure out more and diverse ways to get content to the home and then to ‘sling’ it around the home once there," wrote Jay Rolls, vp, tech.
A Comcast exec Cfax spoke to echoed the sentiment, saying that "this was the year that you really started to see convergence happening." And the good news, the Comcaster added, is that cable’s video services/broadband are necessary ingredients for many of the products.
CableFAX Columnist Steve Effros also pondered the impact of this year’s CES show on consumers and the cable industry in his Jan. 18th CableFAX Column, "Think About That For A Minute…"
Wading through all the press releases, hype and smoke generated by the yearly Consumer Electronics Show has become an annual ritual. Last week’s show was no exception. Several things become immediately clear; first, "reporters" who attend the show are invariably enamored by the latest gadget, regardless of whether it is likely to make it to the market or not. Second, they have very little idea what they are reporting on. But no matter, from our point of view, the Show provides a great window to what the marketers think the public wants. From the cable perspective, this year’s show was all good news.
It comes as little surprise that one conclusion is that consumers want more. More video, more audio, more Internet, more screen resolution, more mobility and especially more ability to see the programming delivered to their homes wherever they want to watch it, whenever they want to watch it. And it has to be easy to do.
Ironically, the device this year that underlined that more than any other wasn’t shown first in Las Vegas. It was at the competitive "MacWorld" Show put on by Apple in San Francisco. While most of the attention there was drawn by the new Apple Phone (we can’t call it the iPhone at the moment…) Apple-in-Chief Steve Jobs also showed off Apple TV, which is really a WiFi enabled converter that takes video downloaded to a computer and easily transports and integrates it for viewing on a television set.
Home networking is finally taking off. Whether it is the Apple TV idea with downloaded material transmitted and stored on a device that can easily display that video on the television screen or the DVR that can be controlled from any set around the house, the bottom line is the same: more video available to the television viewer in easier to navigate packages. Of course, there were less flashy announcements at the Show too, and they all pointed in the same direction as well; new developments with in-home power line distribution and other WiFi solutions abounded.
At one time, this may have been considered a bad thing for cable. The same is true of the announcements this week that Netflix intends to "stream" some videos into subscribers homes, and that the guys behind Skype are backing a new effort called Joost, which is intended to enable peer-to-peer streaming of authorized video. Is this all going to be devastating competition for cable? Far from it. I suspect these new services will simply reinforce how good a deal cable is in the first place.
We deliver. Whether it is by broadband digital cable service of video or broadband digital Internet service of "data" that includes video, we are the lynchpin to the process. If downloading and streaming really take off (something that I suspect will take many years to actually happen in significant numbers), then maybe programmers like ESPN can sell their product directly. Would that be "bad" for our cable service? Nope. It would just place the product’s price and billing more directly on the party setting the value. Cable, one way or the other, will still be the one primarily responsible for home delivery.
This CES made it very clear that there is going to be a flood of programming available to customers. They want it. They also want an easy way to view it and an easy way to find out what’s on, and where they can get it. If we do that job as part of our home delivery, we’ll be fine.