Internet TV the new frontier
Netflix is following the drama House of Cards with four more series this year. Microsoft is producing programming for the Xbox video game console with the help of a former CBS president. Other companies, from AOL to Sony to Twitter, are likely to follow.
The companies are creating networks for television through broadband pipes and giving rise to new rivalries - among one another, as between Amazon and Netflix, and with the big but vulnerable broadcast networks as well.
"These are the very first lab tests in a very grand experiment," said Jeff Berman, the president of BermanBraun, a media company that makes programming for NBC, HGTV, AOL and YouTube. The competition has only just begun. Amazon is making pilot episodes for at least six comedies and five children's shows, with more to be announced soon. Sometime this spring it will put the episodes on its Amazon Prime Instant Video service and ask its customers which ones they like.
Netflix has been ordering entire seasons of its shows without seeing pilots first. Reed Hastings, Netflix's chief executive, said last week that House of Cards, the political thriller starring Kevin Spacey and Robin Wright, had been a "great success" for the company. Its next program, a horror series called Hemlock Grove from the film director Eli Roth, premieres in April.
The trend may inflame cable companies' concerns about cord-cutting by subscribers who decide there's enough to watch online.
Frequently Asked Questions about this Article…
Internet-delivered TV, or streaming, is video programming distributed over broadband connections rather than traditional broadcast or cable. The article explains it's a new front in the fight for viewers' attention — a shift that can reshape media revenue, spur new competitors, and put pressure on traditional cable and broadcast businesses, so investors should watch how companies adapt to and profit from streaming.
The article highlights several players: Netflix leading with original series like House of Cards and Hemlock Grove; Amazon experimenting with pilot episodes on Amazon Prime Instant Video; Microsoft producing programming for the Xbox; and other internet and media companies such as AOL, Sony, Twitter, and media firms that produce content for outlets like NBC, HGTV and YouTube.
Netflix has been ordering entire seasons without pilots, exemplified by its success with House of Cards. Amazon, by contrast, is producing pilot episodes for multiple comedies and children’s shows, putting them on Amazon Prime Instant Video and asking customers which pilots they prefer before moving forward.
According to the article, Microsoft is producing television programming for its Xbox video game console with the help of a former CBS president, signaling tech-platforms using their distribution channels to enter the content business.
The article notes new rivalries are emerging between streaming services (like Amazon and Netflix) and the big broadcast networks. A key concern for cable companies is cord-cutting — subscribers deciding there’s enough to watch online — which could weaken cable subscription revenue if the trend accelerates.
The article points to Netflix’s House of Cards as a "great success" and mentions Netflix’s upcoming horror series Hemlock Grove from director Eli Roth, which is set to premiere in April. These examples illustrate how original content can attract audiences to streaming platforms.
Jeff Berman of BermanBraun describes these efforts as the first lab tests in a grand experiment, implying that the market is still testing business models, content strategies and audience behavior. For investors, this means outcomes are uncertain but that winners may emerge as companies learn what content and delivery models work best.
Based on the article, investors should watch metrics like subscriber growth and engagement on streaming platforms, success of original programming (audience reception to titles like House of Cards and pilots), how tech companies (Microsoft, Amazon) monetize content, and signs of cord-cutting that could pressure traditional cable and broadcast revenues.
Call 1300 880 160
Start a chat
Schedule a call
