Brian Roberts, who runs Comcast, should take a look at this chart. In the last seven years our cable bill has almost doubled and part of the rationale for this is that we have so many more channels to choose from. But as the Nielsen report released today shows, even though cable providers now offer almost 200 channels to the average home, we watch only 17 channels, just like we did eight years ago.
In every other part of the media business the same expansion of choices is leading consumers to follow the crowd towards the hits.
However many niches there are, in other words, film-goers or TV viewers still want to watch what everybody else is watching, and musicians still manage to release mega-hits. Indeed, in a world that celebrates individualism and freedom, many people decide to watch, wear or listen to exactly the same things as everybody else.
Where this all becomes relevant to the current Net Neutrality debate is a technical barrier that none of Copyleft activists who are protesting in front of the FCC have bothered to acquaint themselves with. Comcast and every other cable company has 750 MHz to deploy their service. It is currently allocated like this.
Only 200 MHz is allocated to downstream broadband data. This 200 MHz is shared with everyone else in your neighborhood on a “node”. That’s why on a Thursday night when you are trying to watch Netflix you get the buffering instead of the video. As the number of Over the Top (OTT) players increase (Amazon, Yahoo, AOL, You Tube, Hulu, Netflix, Crackle, Flixster, etc) this is going to be even more of a problem for the cable companies, especially when they start serving up 4 K streams. It won’t a problem for any one like Google Fiber, Verizon FIOS or EPB that is running fiber to the home, but for cable it is a real issue. At some point Comcast is going to have to cut the number of video channels it is carrying. They will go to Viacom and say “we don’t want the third, fourth and fifth MTV channel”. They will go to Discovery and say, “get rid of the Discovery Military Channel”.
My guess is that in five years we will be back to 100 broadcast channels and everything else will be delivered on demand OTT. Needless to say, Viacom, Scripps, Discovery, Turner are not going to like this outcome, but in the end it will be a much better consumer experience. The irony is that the folks at the FCC actually understand what the problem is and are trying to solve it, while the “Free the Internet” crowd and the cable companies have their heads in the sand.