Steve Burke, the chief operating officer of cable company Comcast, opened an industry summit saying that the two big opportunities for cable are interactive television and offering programmes on the web. He warned that if programming providers and cable operators do not note the shift of viewing habits to online they may end up without a business.
Speaking at the annual CTAM Summit in Denver, he related the preference of his children to watching programmes on their computer rather than a television. “An entire generation is growing up with that preference.”
He said that unless something was done to change that behaviour so that they respect copyrights and subscriptions “we are going to wake up with a lot of ingrained habits going the wrong way and we will see cord-cutting.”
He described the TV Everywhere project as a way to put the cable ahead of the internet “and try to not let it roll ahead of our industry”.
Peter Stern, the chief strategy officer of Time Warner Cable, closed the three-day event saying that instead of trying to beat back the internet, operators should focus on giving their customers what they want. He said the aim should be “to deliver the best possible experience to the customers, rather than to deliver the next shiny object.”
He noted that the average American watches four to five hours of television a day and only a couple of minutes online, rising to only six minutes a day among 18-24 year-olds.
“It is incumbent up to us to give consumers a great navigation experience and enable those customers to get the content they want when they want it,” he said. “But we shouldn’t lose sight of the 97% that is watching on TV.”
For years, cable companies have been promising interactive television, without really realising what it means. For years, the internet has been encroaching into the home.
Cable companies, intent on delivering their “triple play” of video, voice and data services, appear to have seen broadband as an adjunct to their cable television services, rather than a possible replacement. Now they are waking up to the reality.
While talking about interactive television and delivering online video, leading cable companies recognise that their future must lie in converged services delivered over internet protocols.
Comcast has a convergence project, codenamed Excalibur, to bring all of its internet protocol services under a common management system. In the medium term, all cable operators have the option to migrate services to internet protocols.
For all the talk of “cord-cutting,” cable is likely to deliver integrated broadband services to millions of Americans. The challenge for cable companies will be to maintain the value of their subscription services.
To that end, Comcast has been linked to a possible acquisition of a majority stake in NBC Universal from General Electric and Vivendi. That would give it a stronger position in programming, and more of a say in how the network makes it available online.