Decades in the news business have taught me two things. First, you'll never get rich as a journalist. And second, and probably more importantly for this audience, sometimes the biggest news is buried in the smallest items.
Last week, for instance, coverage from the Royal Television Society's international conference in London contained this little tidbit from Mark Thompson, director-general of BBC: "Once we start seeing IPTV take off, we will see the cost of broadband decommoditizing."
In plain English--something they apparently don't use in England--he was saying that Internet TV will need a broadband connection to flourish and that once people start watching TV on the Internet the broadband connection will become more valuable and, therefore, more costly.
Thompson even went so far as to suggest this might lead to the rise of a "two-tier" broadband system with the faster tier reserved for Internet TV.
What makes this so important for both wireline providers and cord cutters is that Thompson was saying aloud what many have been whispering; you really can't cut the cord because the cord brings you the Internet. As more people try to get their entertainment from the Internet, the means to do so will start to cost more.
A double service tier? Isn't that what we have now? The first tier is the obvious one: the established coaxial or fiber line attached to the side of the house. It's an entertainment conduit that many believe can be snipped as effectively as a loose nose hair. Chop off that TV line, they believe, and you can have anything you want--as long you have a broadband connection to get it.
The problem is, even with the promise of WiMAX and LTE, wireless broadband is hardly a smokin' pipe. Yeah, there have been reports that both of those are fast tracks and suitable replacements for wireline broadband. But really, do you want to put all your entertainment and business and personal connections in a tenuous link that crosses the air from an unsightly tower to what probably will be yet another antenna or dish of some sort on your residence? If you do, you're going to pay the price. If you don't, you're going to have to find another way to get broadband pipe into your house, and that leads back to cable.
Cable's broadband is also the cable pipe. It's all tied together in that services bundle that the fiber or coax or fiber/coax delivers to the house.
The second small item was related to this, but a bit different. The Motley Fool took issue with the fact that Wall Street was putting such a high value on cord-cutting darlings as Netflix (Nasdaq: NFLX). It's not hard to understand. Wall Streeters will forever chase the dream, the chance to be the first ones in on the ground floor of the next Google or the next Amazon.com or the next Microsoft. While doing so, they risk being the first in line for the next sock puppet or the next dotcom meltdown or, dare it be suggested, the fast fall to the ground when the cord is cut.
They were small items; much smaller than those swirling around Apple TV and Google TV and how many bajillions of dollars Netflix is worth. But they were worth the first look and, if you didn't see them that first time around, the second one. -- Jim