Internet Based TV Network

Earlier this week Google launched Google Video, a service which allows you to download and play videos. Some big time players are participating in the distribution like CBS and the NBA. While some of these videos are free many of them have a nominal download fee (currently $$3.95 or less). This puts them on a level playing field with ITunes videos for the Video Ipod. Now I’m not big on TV and don’t have a need for watching a TV show or movie on my IPod but I understand how many people would want this service.If you spend time commuting on a train or bus you could time shift your viewing and get more done. Go to a vacation home and don’t want to schlep a tape, you can catch up with Desperate Housewives at your lakeside cabin on your video IPod. Very similar to podcasting not only can you to time shift your viewing, but now you can location shift it as well.

Looking at the prices I’m not really sure how profitable it is. For example I can see there being some demand for last weeks Lakers or Knicks game, but will those shows have any sales next year, probably not. Still we are breaking new ground here, so profitability is always a bit iffy at this stage of the game. The question is how much income will people shift to vodcasting. When I was a kid TV was free (ugh do I sound old), but now my monthly cable bill excluding broadband is about $70. Throw in Tivo that’s another $13 a month. If I were to download more than three or four shows a month that would be over $100 just to watch TV. For this portable video to really catch on I think they will need a bulk pricing or subscription rate.

Another thing that will be interesting to watch develop is an internet broadcasting channel. There are quality vodcasts out there like Nerd TV and RocketBoom with Amanda Congdon (video link) but most of what’s out there lacks substance. However I predict that within the next 2 years, a company will make a serious bid to be the worlds first Internet based TV Network. Production costs will be similar to regular networks but distribution costs will be lower. The question that will come up is to monetize it via subscription or download fees or via advertising. Will consumers accept advertising in downloaded videos? Of course the next generation of video players could be more interactive allowing you to “click to buy” or “click for more information” but interruptive marketing is still a controversial subject. If I were to make a prediction I would go with a subscription based revenue model as the one that has the greatest chance of succeeding.

Want to know the one killer move to make portable video catch on, remove restrictive DRM‘s. Allow me to move it to my portable video player, PVR, or into my DVD equipped automobile. Let me become attached, and dependent on it, then you’ll have a service I’m ready to pay for.

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