Would You Pay to Watch Content Online?

Apple wants to charge $30 a month for infinite access to their online catalog of video, which really sounds like paying for a glorified In Demand channel on cable television but just that you would be watching it online. It isn't live television but it would give you all you can eat access from their vast library of content. It sounds silly at first, but this is where television is headed; the days of cheap amateur content as the only legal alternative to watching television online is far behind us. At first programmers were content with using advertising based services like Hulu and YouTube, but now they are asking for a bit more. YouTube's highly publicized Partner Program has some of its top earners acquiring a modest income of a few thousand of a month; more than enough for them to pay federal taxes. That works well for you and me, but it doesn't work very well at all for a television network or a studio.

Clearly, it is just a matter of time before all programming moves online. With digital television, all new equipment, whether it be high definition or not, is essentially a computer with a screen and a ATSC tuner (which would be a dedicated modem except that it does not communicate back with anymore). The next frontier will be won on two fronts; the first is in making these digital televisions fully capable two way devices so that interactive content such as In Demand makes it way into the home without a cable receiver, and the second is in bringing that same experience onto traditional computers in a more sophisticated manner than what is being used now. First off computers do very well in deliver static high definition images and have for many years, but rarely have they ever had the horsepower to deliver a fluid stream in high definition that is required to truly bring the experience of watching television at 720p or higher practical. A lot of web sites offer 720p or higher content but so far it is with smaller clips; Hulu had an unusually small niche offering of content that did not include 2 hour movies.

In order for anyone to want to pay $30 or more for television it needs to be 720p or higher for it to adequately compete with what cable and satellite already offers. In fact you can even obtain 1080p content over the air, so it needs to be competitive. Considering that consumers are already paying for In Demand content in one way or another, either directly or with the package of whatever other channels they are receiving, Apple may want to consider the portability of what they are offering. It isn't enough for individuals to pay for access to the web site to only download the content and watch it on a computer of their choice people need to be able to watch this content at the site as they already do with YouTube and Hulu. Consumers are used to watching content solely through the browser and will continue to expect to do so; for example Hulu has a dedicated program that you can use but I found few benefits towards using that software as opposed to watching it in the browser.

Having to install software like iTunes every time you want to watch the content will get old after a while. It isn't that people feel as though they have a right to watch the content at work, but they will try to do so. The other issue would be encoding the content and getting the point across that, even though they have paid $30 a month, it is for the right to be able to watch it in the manner in which Apple and the programmers have intended for them to, not for the right to back it up to their hard drives and to burn it onto DVD. Some DRM implementation may be in order, because of iTunes allows you to download it from Apple you need to make it difficult to transfer the content and if you can stream it online you need to make it difficult as well. So far the only other plan to offer subscription based viewing is Hulu.

Hulu is based off of an ambitious plan to bring all of the networks that did not want to strike deals with YouTube together and consolidate their content under one web site through an advertising based service. Their offerings are good and their player seems to offer a better picture than YouTube does with a similar stream in lower resolution. With Hulu it is often difficult to determine exactly what the resolution is, because it does not have the geeky technical interface that YouTube does, and it appeals to people who actually want to watch professional content online, not video geeks. The last we have heard about Hulu are rumors that they want to charge $4.99 for newer episodes of shows, and continue to support everything but the most 5 recent episodes of a show through advertising. The bottom line is that currently the easiest way to watch television online is through a set top box like Apple TV or the Roku digital video player. Taking this experience onto an actual PC has yielded mixed results, and until this changes Apple will have difficulty competing with Hulu, which already has a slick interface that is available within the browser by which the viewer does not have to download software ...