Monday, June 27, 2011

Critique of Netflix and Cable battle

I enjoyed reading the post about the battle going on between cable companies and internet video service providers. In the changing technology market consumers are requesting to have access to more and more types of media at their immediate disposal. The competition between internet service providers and cable companies is a perfect competition because they are substitute goods for each other. You can easily replace one with the other and with the quality that you get from internet video services like Netflix and Hulu for the price you pay it is easy to see why a person would switch. I personally have thought about switching to only a Netflix or other provider and currently do use Netflix and also have cable. With such easy access to such a large variety of media content it is easy to see why demand for cable is shifting.
You can see also with the new features that cable has that they are having to add new features to be able to keep the price at what is a sustainable level for them while battling the shift in demand for cable to internet video service providers. The most blatant new adaptation to cable to try and directly compete with such services as Netflix and Hulu is the creation of Ondemand. With Ondemand you are mimicking the services provided by Hulu and Netflix by giving users the direct access to their favorite T.V shows and movies from movie channels they currently subscribe to at any time. They went after the convenience market segment to try and draw them back in and made it easy by simply adding the feature to what already existed without having to install anything or do anything major. This feature worked for a while but then people became complacent with that technology and so the internet video service providers countered back by adding their service to existing products. You can now buy televisions sets and blu- ray players and even all the current gaming systems support some type of online streaming internet video service.
This transition occurred nearly 3-4 years ago and is steadily increasing with every new device that is coming out. However, not to be outdone the cable companies are counteracting this by having specific channels open up their own streaming sites to watch free episodes or like in the case of HBO their entire library of series and movies if you currently have a subscription to the service through an approved cable company.
This is the next strike in the current war for our attention spans. Without consumer demand driving the need for quicker access to digital media this price war would not be occurring.

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