As Comcast, Time Warner and other companies venture online, Netflix and CinemaNow, which stream movies over the Internet, say they're not worried.
Last week, Time Warner CEO Jeff Bewkes revealed his vision for TV Everywhere, a service that gives existing cable subscribers access to shows online and on their mobile devices. Comcast unveiled similar plans last month with OnDemand Online. At a media and telecom conference last week, Bewkes implored other cable providers to follow suit.
“What we’re saying is every satellite and telephone and cable distributor can and should offer all of this stuff on broadband,” he said, according to a Video Business report. “And the condition is that everybody who’s watching should be a multi-channel TV subscriber.”
Though plans from Time Warner and Comcast share a goal of squashing free Internet services such as Hulu and TV.com, they could also pose a threat to online rental services offered by Netflix and CinemaNow. But comments from the latter two companies indicate that they're ready to co-exist.
The "value proposition" is different, CinemaNow strategy VP Mark Ely said, because his company doesn't offer ad-supported content. “We think of ourselves as being an a la carte video store," he told Video Business. He did, however, admit that cable companies would become competitors if they started streaming on-demand movies online.
Netflix spokesman Steve Swasey said that some Netflix subscribers have dropped cable, but he thinks there's room for both services, adding that all revenue models -- pay-per-view, subscription and ad-supported -- will continue to grow onlne.
The best quote in Video Business' story, however, comes from analyst Brahm Eiley, suggesting that cable providers have it backwards in trying to move online. It echoes the idea that people are dropping cable because it costs too much, not because they'd rather watch on their laptops. Indeed, my favorite part of Netflix streaming is the ability to watch movies and entire TV show seasons through my Xbox 360, without dropping $50 a month on cable.
"Everybody who is online is dying to get to the TV set. Now, here come the TV guys, and they’re going online,” Eiley said. “Good luck. The economics are not favorable.”
