The FCC has had to review two major mergers in the content industry: Comcast and Time Warner, AT&T and DirectTV. As a part of these reviews, the FCC requested the Pay-TV deals that these companies are involved in to be made available for third parties. “The documents in question, which would be released Thursday unless the court acts, contain details of the agreements between channels and pay-TV providers, including business terms such as the price for carrying channels and guidelines for making content available online.”
TV channel owners Walt Disney Co., CBS Corp, Viacom Inc., 21st Century Fox, Time Warner Inc., Scripps Networks Interactive and Univision Communications Inc. requested that releasing the details of these deals would cause substantial harm to their businesses in the competitive TV programming market.
Go to WSJ for more.
Lame duck president has big plans for free and open internet. Could reclassifying the network as an utility work?
President Barack Obama has come out in favor of net neutrality in a special website and video announcement wherein he lays out his plan for protecting the freedom and openness of the Internet. In a video and letter, he lays out in no uncertain terms that he believes no cable company or access provider should be able to put limits on access to the Internet.
He says that he’s suggesting that the FCC recognizes access to the Internet as a basic utility, and something that Americans have a basic right to. This means no blocking, no throttling, more transparency and no paid prioritization, Obama writes in his letter, which is quoted in full below.
An open Internet is essential to the American economy, and increasingly to our very way of life. By lowering the cost of launching a new idea, igniting new political movements, and bringing communities closer together, it…
View original post 1,209 more words
Today, Wired posted a story aimed at clearing up some misunderstandings about net neutrality, like the idea of “fast lanes” for established companies who can afford to pay for faster access to their customers, that would keep start-ups from entering their markets. Now some experts on internet infrastructure have come forward to explain that this easy to grasp concept is from the early days of internet, but that the internet doesn’t work like that anymore.
In fact, big companies, like Google, Facebook or Netflix already have access to fast lanes through “Content Delivery Networks” or “Peering Connections”. That means, they have direct connections to the service providers and dedicated servers there.
The real issue is market power on the side of the service providers. In the USA, internet companies almost have to use Comcast or Verizon if they want to reach a broad customer base. So those who control the pipe can tax those who depend on it for their business. Great news for Comcast shareholders, bad news for Netflix shareholders and customers.
Read more on the implications on wired.com.
Now that Comcast-TWC and AT&T-DirecTV are set to become giant content distribitution platforms via Pay-TV and VoD, there seems to be some motivation for media houses and smaller Pay-TV channels to form alliances in order to regain some leverage when bargaining with these new giants that stand for half of all US Pay-TV customers.
According to a WSJ article, cable networks like AMC could look to team up with medium-sized media companies like Viacom who themselves could become targets for big guns like Disney or CBS. One of the expected players is 21st Century Fox who have billions to spend and might look at Time Warner, home of CNN. “Consolidation might not seem to have much positive impact in the short term, but could really benefit content and channels companies over time by providing negotiating scale and diversity of product,” said Michael Morris, a media analyst at Guggenheim Securities. Other driving factors include international growth and content-licensing revenues.
Shareholders’ demand for dividends and boosting stock prices through buybacks as well as regulatory issues could work against any large mergers and acquisitions.
Read the whole article on WSJ.com
Sometimes satire ist the best source for knowledge. John Oliver takes a look at what net neutrality means to consumers and to telecom companies.
According to WSJ, Apple and Comcast are looking to become partners in the TV market with a service centered around Apple TV, a streaming box that will stream live TV and on demand content and bring the easy to use interface of Apple products to your TV.
To make sure that Apple’s video signal is transported to the customer in best quality, they’re trying to strike a “privileged access” deal with cable giant Comcast, which would assure that the “last mile” of traffic is kept clear for data on Apple TV. This would guarantee the same streaming quality whether a customer uses a Comcast Xfinity STB or Apple TV.
Should these two giants strike a deal, the home entertainment battlefield, which is populated by Sony (PS4), Microsoft (Xbox One), Amazon (upcoming Android Set-Top-Box) and Google (Chromecast) could see a true disruption. It seems realistic to assume that the winner needs to control hardware, content and bandwidth – and an alliance of Apple and Comcast would come pretty close to achieving that goal.
According to the article a deal is not even close because Comcast would have to shoulder investment into their network technology and Apple is demanding control over customer relationships and data. Making things more complicated are repercussions of the Comcast-NBCUniversal takeover regarding net neutrality.
In the meantime, on his blog, Netflix-CEO Reed Hastings is calling for more net neutrality and accusing Service Providers of cutting a raw deal for Netflix, the video streaming service responsible for nearly a third of peak downstream data traffic in the USA. Netflix subscribers are suffering from congestion, which causes buffering, waiting and poor video quality. These problems directly affect Netflix’s business.
Service Providers know this and are looking to charge fees for “preferred services” while they’re actively slowing down Netflix traffic. Hastings: “When an ISP sells a consumer a 10 or 50 megabits-per-second Internet package, the consumer should get that rate, no matter where the data is coming from.”
The battle is far from over and everyone is bringing out the big guns.
After the FCC dropped net neutrality (the principle that all internet traffic should be treated equally) amidst lobbyist pressure from ISPs, two online giants, Netflix and Google, find themselves on the other side of the argument. Netflix is afraid that ISPs will throttle their business, which is dependent on both bandwidth and data volume, as Netflix is responsible for 1/3 of US downstream traffic. Without net neutrality ISPs can try to sell “managed services” to video streaming providers which would guarantee them access to the fast data pipe over competitors, who aren’t willing to pay to play. ISPs can push their own video streaming services through the same mechanism. “You can watch the buffering wheel on Netflix or try out our smooth full HD offer Redbox Instant by Verizon.” Netflix’s strongest argument are 30 million subscribers. How would they react if their ISP slows down their video streaming or what if Netflix pulls it service from any operator, that slows them down? That is, of course, if customers have the choice to switch. If all ISPs decide to milk provisions from Netflix, they have nowhere to turn. Or do they?
“Google’s business depends on an internet where all traffic is free and equal.” With Google Fiber expanding all over the USA, this could be the broadband offering that aggressively pursues users who are fed up by a throttled internet. And what service would be better than Netflix to lure them in?