There’s No Such Thing As Free TV

In the early days of television it appeared the shows were free, just put up an antenna and watch your favorite programs for nothing.  But as we all know, we paid for our viewing by watching commercials.  Then came cable TV.  We paid a small fee to avoid the hassle of messing with antennas, but we still watched a lot of commercials.  However, this started the upward cost of watching television.  Cable providers slowly added more channels and raised their fees.  They even offered commercial free networks like HBO and Showtime, but at an even greater cost.  It’s not uncommon today to pay over $100 a month for cable or satellite access.  Then they charged even more for DVR boxes and services so we could skip over the commercials.

Now people are abandoning their cable/satellite services to save money and going retro by using antennas again, and getting over-the-air (OTA) HD television.  They supplement their viewing variety with Netflix, HTPCs and now DLNA compliant devices.  Getting TV from the Internet gives the illusion that we’ve finally found a way to get free TV.  Don’t count on it.  We still pay $25-50 a month for broadband Internet access, and we still watch a lot of commercials.  And if the movie and television industry has their way, they’ll find new ways to charge us for watching our favorite shows over the Internet.

Netflix, at $8.99 for 1 disc service and streaming video via a Roku box is probably the cheapest way to get the most TV watching bang for the buck.  Now Netflix is under attack by the Hollywood Studios.  As the Business Week article points out, studios don’t like the all-you-can-eat streaming pricing.  They want a cut of the action for each movie you watch, because they consider streaming equal to cable/satellite pay-per-view movies, that cost viewers $4 a pop.  And the studios, like Warner Brothers, want to slow the access to movies that Netflix rents because Netflix is cutting into sales of DVD/BD discs.  I know I don’t buy discs anymore, so I can understand this.  And if you haven’t noticed lately, a lot of streaming content on Netflix started showing expiration dates.  Bummer.

Generations of television viewers who grew up after the Baby Boomers don’t remember “free” TV.  Every house had an antenna sprouting from the roof and you didn’t have to pay a monthly bill to watch your shows.  Of course, we didn’t have the power to skip commercials, and we only had 3-4 channels in our nightly lineup.  We had NBC’s Saturday Night at the Movies showing new to broadcast films, and each station had a library of old films they could show at odd hours of the day, usually in the middle of the night.  Life was simple then.  Of course, so were the shows.

Decades later, television shows and movies cost untold millions to make, far more than what broadcast commercials and movie tickets can finance.  Movie makers want to maximize their profits by selling their films several times, in a standard tiered released system where they get the maximum revenue at each stage:

  • Theatrical releases
  • DVD/BD sales
  • Pay-per-view
  • Premium cable (HBO, Showtime, etc)
  • Basic cable
  • Broadcast networks
  • [Netflix streaming?]

So where in the hierarchy do they release titles to Internet streaming?  And if DVD/BD sales are hurt by rentals, when do you release titles to Netflix?  Right now, I pay the most for movies because I watch a lot of flicks on the big screen.  I could probably save $500 a year by waiting for movies to come to Netflix.  This is one reason why I don’t care about getting cable TV anymore, or when movies get to Netflix.  But if you aren’t big on going to the movies, this does matter.

The trouble for movie makers is Netflix is so damn efficient and cheap.  Even without streaming, for $8.99 a month you can watch about a 100 movies a year, and with streaming, your selection is overwhelming.  Who needs to watch more?  And if you count that Netflix rents/streams TV shows and documentaries, that makes $8.99 a month the cheapest form of TV watching other than OTA viewing.  Sports is the main thing missing, and probably why more people don’t give up cable/satellite.

Now Digital Living Network Alliance (DLNA) is catching on, allowing you to stream video content off the Internet directly to your TV, without using a computer.  Geeks have been hooking up their computers to their TV for years, but it’s not an elegant consumer oriented solution.  All the major TV manufacturers are starting to build DLNA technology directly into their TVs, meaning you won’t need a Roku box to stream Netflix and Amazon videos.  Each manufacturer can choose which streaming system to support, or in some cases, they can support PC servers like PlayOnTv that will talk to your TV directly, or via your Wii, PS3 or Xbox 360, so you can watch Hulu and other emerging Internet TV networks.

Essentially, online TV networks like Hulu.com, CastTV and TV.com are ways to get broadcast and cable network shows free off the Internet, or free if you ignore your ISP bill.  But when content providers realize that these services will undercut services higher up the economic viewing ladder, will they continue to offer their content for free?  Will there be more commercials, or even subscriptions required?

I installed PlayOnTV on our Wii and played around with Hulu.  The Wii remote made a decent TV remote and worked well with the Hulu menu system.  This bit of testing provided an epiphany for me.  Internet TV is like cable TV – too many channels and too much to see!  Since I’ve given up cable TV and lived for a few months with just ABC, CBS, NBC, PBS and Netflix, I’ve learned to love simplicity.  I thought I wanted more documentaries which Internet TV might offer me, but it’s not worth the hassle of finding them. 

I like the higher quality of watching Blu-ray discs, or even DVD quality, over watching Internet TV quality.  Broadcast HD seems better than cable HD, and Blu-ray 1080p is even better yet.  I’ve gotten used to pristine picture quality, and for me at least, visual quality is better than viewing quantity.  I don’t mind waiting for BD discs to come in the mail.  I know my viewing habits aren’t typical.  My wife is a channel surfer and loves to see what’s on by flipping through hundreds of channels.  If you’re like her, then you’ll need to pay for cable/satellite, or spend the money for Internet TV options.

I pay $16.99/month to Netflix for 2 discs out at a time with Blu-ray.  That’s as cheap as I can get while getting the most TV watching for my dough.  If the movie studios force Netflix to charge more for streaming, I’ll live without streaming.  I’m a little annoyed that Blu-ray discs cost more to buy and rent than DVDs when they look physically identical, but the extra visual quality is worth it to me.  I don’t mind watching Big Love or Weeds months after their HBO and Showtime broadcasts.

TV isn’t free, but it doesn’t have to be expensive either.  How much you pay for TV depends on how impatient you are to see new shows and films.  As I get older I’ll probably stop going to the theater as much, because paying $10 to see a movie the first week it’s out won’t be as important.  I know a lot of old guys who stopped going to the movies altogether.  If you’re young, restless, twitchy and impatient, then you’ll probably love flipping through 300 cable channels and won’t mind paying $100 a month for that pleasure.

When I heard Warner Brothers wanted Netflix to wait a whole month before renting movies that had just gone on sale, I laughed.  At 58, a month is nothing.  To a teenager or twenty-something, waiting a month is probably unbearable.  I’m still finding new movies from the 1930s to watch, and I’ve seen thousands of them already.  I’d much prefer Netflix maintaining it’s low rates than getting movies sooner.  Let the young finance the movie and television industry – if you’re patient you can save your money for retirement.

JWH – 1/17/10