Cutting The Cable

We are in the early stages of a shift from traditional television delivery to online television delivery.  Yet many like me suffer from an acute case of OCD regarding picture quality that prevents us from “cutting the cable”.  Trading a beautiful HD television picture with a highly compressed online video “HD” picture is not sufficient… for now.

The cable companies that control internet access (Comcast, Time Warner, etc.) know this.  The conflicting interests of web and television have caused U.S. cable providers to restrict bandwidth to prevent the change.  As a result, the United States currently ranks a pathetic 12th in broadband speed.  The fear is that offering broadband at 100Mbps will cannibalize their TV business and erode profits in their lucrative internet access business.  Unfortunately this fear is not only valid, it’s true.  But rather than ignoring change as the music industry did, cable companies should focus their efforts on building a more profitable online business model.

Ultimately, I believe the model will resemble that of the wireless providers.  Customers will pay for access on a usage basis, with unlimited plans available to satisfy the appetite of bandwidth hogs.  This is a fair and proven model.  Think of the parallels that television and internet have with landlines and cell phones.  Many Americans no longer have landlines because they have increased the minutes on their wireless plan, resulting in a net savings.  Though the overall pie will be smaller, this is a win-win scenario.  Cable companies will undergo further consolidation, but they will be able to profitably improve their offering to the consumer.

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See how your connection compares: test your speed here, then read this article.