A war between the big cable companies and over-the-top services like Netflix has been raging for a few years now. The frustration of the cable companies is easy to understand, as online video services compete with their pay-TV offerings, as well as putting a strain on their own infrastructure without paying any of the cost. During peak hours, Netflix alone accounts for over 30% of the data being sent via the internet. As a result, they’ve recently been forced to pay up and sign “peering deals” with major cable companies in order to ensure reliable service to their customers. A proposal before the FCC to allow for “internet fast lanes” would give ISPs even more leeway to charge Netflix and other similar services. That proposal however, has drawn a lot of criticism across the board.
Rather than gain a new weapon in the fight, the cable giants may find themselves in even worse position when all is said and done. The FCC received almost 4 million comments, with almost all of them opposing the plan for fast lanes and asking that the FCC put strict rules in place to protect net neutrality, or in other words, to prevent ISPs from meddling with internet traffic, like that of the streaming video services. Any tactics that the cable companies employ against OTT services will only draw the ire of their mutual customers, making this “war” essentially unwinnable for them, at least without a major strategy change.
Whether they’re trying to stymie their competitors or shift the cost of network upgrades onto them, the cable companies are already fighting a losing battle. OTT services are not going away, and the challenges they post to traditional cable companies will only continue to grow as more and more people begin using them, sometimes dropping cable TV in the process. And while the cable companies have legitimate gripes, they tend to find little sympathy among their consumers who use who use OTT services. Forcing both the sender and the recipient to pay for the delivery of the same content strikes most as simple greed, and often seen as typical of the cable providers, especially considering the high prices they charge their subscribers.
The cable companies are at a crossroads. While they’re accustomed to not having to compete with anybody, the rise of the internet means that that is no longer, and never again will be the case. Demand for content of all kinds means that ISPs will see more strain put on their networks. That raises the question of who will foot the bill for the upgrades required to make it all run smoothly. The cable companies’ answer seems to be “anybody but us.” But their days of being able to pass on the costs to both customers and content providers are numbered. Consumers, content providers, and perhaps even the FCC have all had enough.
This isn’t just about Netflix. People are spending more time watching online video from a variety of sources, many of which are not subscription services. YouTube, DailyMotion, and other such websites have millions of videos which are free to watch. Most TV networks offer a means to watch their TV shows online as well, again, mostly for free. Another service, Rabbit TV, offers an online media guide for all of this free content, as well as paid options. Since the transition to digital TV in 2009, all TV shows exist in a digital format that can easily be streamed over the web or hosted online. So now a days, just about everything people want to watch exists on the internet in some fashion, regardless of what website or service it’s accessed through. That isn’t going to change, and while the cable companies can hamper services like Netflix, they can’t stop the demand for online video, nor can they stop users from seeking out the content that is so readily available.