Internet Television to Compete With Netflix and Hulu

Networks and cable companies are creating Internet television services that they are marketing to younger audiences. The rather sudden rise of online streaming has left traditional TV networks in peril, and the television industry has been given an ultimatum. Networks must find ways to adapt, or sit back and watch public interest in traditional weekly programming evaporate for good. Last year, HBO and CBS announced their plans to create over-the-top services. Now other networks and cable providers are following suit. The goal is to develop online streaming services that will complement or even compete with Netflix and Hulu, and then advertise these services to millennials.

A cable subscription has always been a prerequisite for anyone wanting easy access to HBO. By excluding those without cable subscriptions, HBO has done itself a disservice. Just consider the number of people who justify illegally downloading hit shows like Game of Thrones because they don’t have satellite TV, or because they find it more convenient to watch television on a computer screen.

HBO knew it was time to transform its business model. The network was the first of many networks to announce plans for an over-the-top net streaming service. Soon, viewers will be able to bypass the complications and cost of a cable subscription, and stream HBO online Netflix-style.

 The television industry was abuzz over HBO’s big news.

 But the very next day, another network announced its own web-based streaming service. CBS introduced the world to “CBS All Access”. Like HBO’s online service, CBS All Access allows viewers to watch CBS content online without a cable subscription. The difference, though, is that CBS’ service lets users stream programs live, in addition to giving them day-after access to prime-time shows, as reported in Advertising Age. For a measly $5.99 per month, CBS lovers have access to all of their favorite programs.

 It’s not just the networks that have jumped aboard the online streaming train. Now, cable providers are developing online services of their own.

 Dish announced its new Internet TV streaming service last week at the International Consumer Electronics Show in Las Vegas. Dish’s new service is SlingTV, an Internet television service that gives its subscribers access to over 12 channels for a $20 monthly fee.

 Offering an online service that features multiple channels seems like a great idea. It’s something networks themselves just can’t do. But the stakes are especially high for Dish.

If SlingTV proves to be a more attractive alternative to cable TV for Dish’s current customers, the cable company could be in hot water. Dish hopes to market SlingTV exclusively to millennials who do not have an existing cable subscription, the Washington Post reported. But even though SlingTV is targeting a young audience, the service is still in the experimental phase. It’s doubtful that SlingTV will coax binge-watchers away from their Netflix subscriptions, but the service will certainly entice college-aged ESPN lovers who want to watch live sports but don’t have a cable subscription.

 Verizon is yet another company that has decided to market its services to an internet-savvy generation. According to Variety, Verizon’s streaming service will offer 20 or 30 channels, and will probably debut in mid-2015.

 These new over-the-top services are hardly solutions to industry-wide woes. Internet television is still in its early stages, and online streaming won’t necessarily revive a public interest in weekly programs.

In fact, over-the-top services could create new problems for the television industry, especially if they prove to be successful alternatives to cable. Networks that have not created Internet streaming options could be in jeopardy; HBO and CBS might produce enough high-demand content to justify the creation of an over-the-top service, but most networks don’t.

Amidst all the uncertainty, some things are clear. Online streaming is not going away, companies are finally working to find innovative solutions to industry-wide problems, and internet television may emerge as a third contender for the public interest.

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