The death of free-to-air television

A FEW months before Christmas 2005, the UK’s biggest electronics retailer, Currys, announced that it would not be stocking VCRs that year. It was one of the earlier announcements of the approaching death of what was a staple in many households worldwide.

By the end of the 2008, the VCR was well and truly gone. JVC, one of the major brands, made its announcement about shutting down its manufacturing of the gadget at that time.

In its place has come the hard-disk recorder, which also affords the user the option of burning recorded material to DVD or, more recently, to Blu-Ray. Technologies come and go in this manner.

A few years hence, we will be looking at the death of free-to-air TV. That will happen once there is broadband which can support speeds sufficient to stream video of good quality. Broadband of such bandwidth exists in various countries and there are some services which stream films across the internet.

But it has not yet become mass-market. If there is fast internet in a country, the cost puts it out of reach of the majority. Internet costs have to drop; that will happen once more providers are able to offer faster speeds. Competition is the only way prices will drop.

Once that happens, the creators of content for TV will find it much more economical and easy to stream their content across the net. Their market will expand outside geographical boundaries and they will also be able to pull advertising which the TV channels ran along with the content.

Services like Hulu and Netflix which stream films are now confined to a few countries. Some telcos are experimenting with streaming films too, but the services are yet to reach tipping point. Like all digital technologies, costs will be low and the success of a service will depend on attracting big numbers.

Pay TV will take some more time to die than its free-to-air counterpart. Many pay TV services depend on telecasting sport to survive; the sports, in turn, depend on the money that is paid to them by the TV channels.

It is logical to assume that the pay TV channels themselves will start streaming content on the net. The sport authorities, of course, will demand additional rights money.

In some cases, those who administer the sport may experiment with streaming on the net; the Australian Football League allows people to watch matches free after the event right now, with all the footage coming from one of the TV channels which has the rights for broadcasts.

Who knows, one day the AFL might decide to do it on its own. It all depends on how much money can be made.


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