Death of the TV channel?

netflix.jpgThe television business is pretty much a free-for-all these days, with a mishmash of platforms, content providers, and methods of distribution. There's no telling where any of this might lead, or when, which makes predictions for the coming decades look more like a roll of the dice. But Netflix CEO Reed Hastings has a knack for identifying what viewers want (or don't want), and he's out with an 11-page essay on where he believes TV is headed. One of the big takeaways: Apps will replace channels. That's not such a huge leap - the old-fashioned business model (what Hastings refers to as "linear TV") that involves watching programs at a particular time on a particular day is as antiquated as picking up a daily paper that has yesterday's news. He lays out the future quite neatly, though getting there will be a messy and lengthy process of fits and starts. Anyone who watches a streaming video from Netflix and has it interrupted by sluggish Internet speeds knows what I mean. From his post:

While Internet TV is only a very small percent of video viewing today, we think it will grow every year because: 1 The Internet will get faster, more reliable and more available; 2 Smart TV sales will increase and eventually every TV will have Wifi and apps; 3 Smart TV adapters (Roku, AppleTV, etc.) will get less expensive and better; 4 Tablet and smartphone viewing will increase; 5 Tablets and smartphones will be used as touch interfaces for Internet TV; 6 Internet TV apps will rapidly improve through competition and frequent updates; 7 Streaming 4k video will happen long before linear TV supports 4k video; 8 Internet video advertising will be personalized and relevant; 9 TV Everywhere will provide a smooth economic transition for existing networks; 10 New entrants like Netflix are innovating rapidly. Eventually, as linear TV is viewed less, the spectrum it now uses on cable and fiber will be reallocated to expanding data transmission. Satellite TV subscribers will be fewer, and mostly be in places where high-speed Internet (cable or fiber) is not available. The importance of high- speed Internet will increase.

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
Mark Lacter, business writer and editor was 59
The multi-talented Mark Lacter
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