Cutting the cord - is OTT the wave of the future? It is for me

Jim O'Neil

I plan on cutting the cord. Not immediately, mind you, but in the not-too distant future I'm going over the top.

Nothing irks me as much as the couple of hundred bucks I pay each month for my high-speed Internet, my VoIP phone connection, and my cable TV, not even the cash I drop each month with Microsoft for my Xbox connection (no, it's not me playing Modern Warfare 2, it's my sons ... who are away at college. Hmm).

I need the Internet connection ... and I admit I'd happily pay to have more than the 20 MB service I currently get - sporadically - from Charter. And, because of where I live, I use VoIP, for which Charter charges me an arm and a leg. I had an iPhone, but despite assurances that my area "would soon be getting 3G service," I spent an awful lot of time NOT browsing the web because my service was so poor and searching for dropped calls - I sold it on eBay. (Note to Steve Jobs: I know you're busy with that tablet announcement and all, but if you get a chance, you really need to look at a different carrier for the iPhone. AT&T just doesn't cut it, man. I loved the phone, but the service was woeful. Call me, we can chat about how crappy it is to not have 3G. By the way, love my MacBook Pro.)

As for my cable TV hookup ... *snip* ... I'm outta there, well, in a couple of months, anyway. The early termination fee is more than a car payment, and, hey, in this economy that just doesn't make sense.

I won't be alone, Michael Greeson, of The Diffusion Group, last week wrote an opinion piece, "Cord Cutting - The Threat May be Larger Than You Think," pointing out that one of the hottest topics at the CES show was how at risk cable companies were and how aggressive the OTT industry was becoming.

He pointed out that the industry, by and large, has ignored the threat because, well, it really hasn't matured yet. Nonetheless, it exists.

As Greeson points out, operators are being pushed by content creators to share more of the wealth (and operators, in turn, are bumping up subscription fees). Increasingly, programmers are looking for ways to bypass operators, using in-house platforms to push more content to the web. Many aren't making much money from it, but they know it has to be up there to build brand awareness.

Companies like OVP Brightcove, which this week launched a new TV Everywhere-SP platform designed in large part to give programmers an alternative to current options already in place, knows programmers are dying to get their content online. Consumers are demanding more premium content be available. But are they willing to pay for it? And how much?

That's a question Cablevision should have a little extra insight about. One of its properties is Newsday, a huge suburban daily on Long Island. Last year, Cablevision instituted a pay wall around the newspaper's website, and began charging $5 a week for access. (Cablevision subscribers get in free.) Total subscriptions for the year? Just 35. How's that for price-point resistance? News junkies found other ways to get their fixes for free.

Just like I'm going to do with my TV. I can wait a day to watch "Lost," but deciding how I'm going to get to it is going to be a tough decision. Greeson says he's going with a digital antenna and Vudu. I'm going to haunt programmer websites, Hulu, maybe even YouTube. I'll watch pre-rolls, click on a couple of display ads and see how long it stays free.-Jim

Suggested Articles

Alan Wolk, co-founder and lead analyst at TV[R]EV, carries out a postmortem on Quibi.

AT&T is still suffering massive pay TV subscriber losses and HBO Max is still working through distribution woes.

Using its OTT Video Market Tracker tool, Parks Associates has found that the number of OTT services in the United States has reached nearly 300.