Streaming Video Means Prime Time All The Time
TONY COX, host: This is TALK OF THE NATION. I'm Tony Cox, in Washington. Neal Conan is away. The days when your entertainment options were limited to the 300-plus channels on your cable box seem quaint nowadays. Netflix, Hulu, Amazon, HBO GO, Internet TV has made the vast wasteland truly vast, changing how and where we watch almost everything. Some people even ditched Netflix after its recent price hike, something that would have been unthinkable had there not been so many other alternatives.
Today, we'll talk about those alternatives and what media companies are doing to compete in this new world, and we want to hear from you. How are you watching TV differently? Where are you watching it? Our number is 800-989-8255. Our email address is firstname.lastname@example.org. And you can join the conversation at our website. Go to npr.org, and click on TALK OF THE NATION.
Later in the hour: What have you done to avoid left turns? No, really. Traffic expert Tom Vanderbilt has a better idea. But first, we talk about how we watch TV now. Farhad Manjoo is with us. He is Slate magazine's technology correspondent, with us from a studio at Stanford University in California. Farhad, nice to have you.
FARHAD MANJOO: Great, thanks. Good to be here.
COX: Am I saying your name right?
MANJOO: It's Farhad.
COX: Farhad, okay. Well, I wanted to make sure I had that correct. Thanks for getting that going. All right, let's talk about this. Can people really unplug their cable now and not lose anything?
MANJOO: You know, we've had these reports for a few years now of people - you know, cutting the cord is the way people in the tech industry describe it. And I think they're mostly anecdotal. Most of the people that I know about, including me, what I've done isn't sort of cut the cord, but cut back on cable.
So, you know, I used to get premium channels, and I don't any longer. And I think that seems to be what many people are doing. They're cutting back on cable. Or even if they're not cutting back, they're supplementing cable with one of the services you mentioned, so Netflix, Hulu Plus or Hulu, which is the regular free version on - that you can watch on your computer - iTunes, all these various services that are available now where you can get - you know, for a small amount, a relatively small amount of money, compared to your cable bill, you can get, you know, a wide variety of shows over the Internet.
COX: You know, I want to make this a two-pronged conversation, one to talk about the technology, which is why we have you, and the other to talk about the content. And to do that, the changes in how people are watching TV haven't just affected those of us watching the studios, content providers, networks. Aggregators are adjusting, as well.
Pam Allison is a digital media and marketing strategist. She's worked with companies like Disney and DIRECTV, and she is going to join us right now from our studios at NPR West. Pam, nice to have you.
PAM ALLISON: Thank you. Nice to be here.
COX: So we heard already from Farhad how things are changing technically - technologically, I should say. How are they changing, if at all, from a content standpoint as a result of the technological changes?
ALLISON: Well, content companies are always wanting to expand, you know, how they get their content to consumers. They know that consumers want to view their content on a variety of platforms. So they're starting to offer that content, you know, not only on TV, but also on, you know, platforms like Netflix and iTunes and such.
The difference that you've kind of seen, though, is that it's really all about a windowing strategy. So it might show up on the TV first, and then on these platforms later down the road.
COX: We've mentioned Netflix several times here, both of you, and we mentioned in the introduction, as well. Back to you, Farhad. Netflix, how big a player are they in terms of this technological revolution?
MANJOO: They're huge. They're sort of the biggest of these add-on services. They have something like 23 million at the last time they - I think 23 million paying subscribers. And, you know, they started as a DVD rental company. You know, everyone knows them for the red envelopes that they mail out containing DVDs.
But over the last few years, they've really skillfully transitioned to an Internet streaming service, and they've really but out front at getting their streaming service on a number of devices that you can get. They're streaming shows on, you know, all the video game consoles, on many TVs and on computers, too.
And so because they've done that and they've been out front at licensing shows and movies, you know, they're trying to position themselves as being first for streaming, that you would go there for streaming, and you would consider their DVD service sort of a supplement to that. You would get a DVD of something that you wouldn't be able to find on their streaming service.
COX: I don't know how successful they have been at programming, but before I come to you on that question, Pam, let's take a caller. This is Josh from Owensboro, Kentucky. Josh, welcome. You're on TALK OF THE NATION.
JOSH: Hi, how are you doing?
COX: Hi, how are you?
JOSH: I'm good. I just wanted to say I'm one of these people who do watch TV solely using Netflix and Hulu Plus. It saves a lot of money. I haven't had a cable bill in probably two years. And also, just recently, just in the last week, I got a packet in the mail from Nielson, and they said Hulu and Netflix are now options that they keep track of.
COX: Really? Let me ask you a question, and then we're going to follow that up with Pam. Are you watching original programming on Netflix, or are you just watching program that is being redistributed through them?
JOSH: Well, I started off doing just mainly redistributed, you know, main network TV shows, sitcoms, things like that. But Netflix - well, Hulu (unintelligible) has a suggestion feature, where they say, you know, hey, try this. And they have a lot of options from BBC, and I have some original stuff from Netflix. I've never seen...
COX: Oh, it looks like we lost him. Pam, what about it? What about content? Netflix has, as we know, has been very successful with the platform. But how successful has Netflix - and others, actually - been in terms of original content?
ALLISON: In terms of actually developing content on their own?
ALLISON: I mean, it's still very limited success. You know, Netflix announced they were doing that show with - their movie with Kevin Spacey. And, you know, I think we'll see how that plays out. But so far, there really hasn't - you know, there's been kind of a few hits online, but nothing compared to what you've seen on television.
I don't think we've seen any big, you know, migration to people wanting to watch content, original content online. I mean, there are certainly ones that you can point out, but nothing compared to television, at least not yet.
In part, that's just simply due to the marketing machines of the networks. You know, they have so much money and so many eyeballs where they can drive consumers to watch their content. Whether they end up watching it on TV or online, they still have those marketing machines, and, you know, the other players haven't been able to quite compete with that as of yet.
COX: Let's take another caller, shall we? This is Meredith from Rochester, New York. Meredith, welcome to TALK OF THE NATION.
MEREDITH: Hi, thank you. I just wanted to say that my husband and I don't even own a TV anymore. We just watch everything on Hulu on our laptops.
COX: Really? And tell us why you decided to do that.
MEREDITH: Well, we were both in college, and we just didn't have a TV when we got married. And it's just so easy. And it's nice, too, because we can watch our TV shows whenever we want, and it's free. So it's pretty great.
COX: All right, thank you for that. That brings me a question for you, Farhad. Is this a generational thing, younger people, in college, in their 20s, 30s maybe, that are more likely to do this than people in their 40s, 50s or 60s?
MANJOO: You know, I suspect it's a generational thing, but it's probably not a very distinct generational thing. I mean, obviously, there are people in college who are more - and younger who, you know, are more familiar with the Internet are obviously sort of going to be at the forefront of this trend.
But, you know, I think that many older people who are looking at their huge cable bills every month might also consider this. And, you know, it's definitely not - devices like the iPad and iPhone are definitely not, you know, being used exclusively by young people. And those devices are kind of at the forefront of this.
You know, you can watch shows now on many different kinds of screens, and you can watch them kind of on the go. So you can watch movies and TV shows while you're on a plane or on a bus. And, you know, all of those things, I think, appeal to people, you know, across all ages.
COX: What are we to make, then, of how this is going to ultimately impact the industry? What I'm trying to get at is whether or not cable, for example, or satellite will begin changing - or perhaps they already have - their kinds of platforms to keep people in-house with them, or to help them take advantage of people who are watching on these other platforms.
ALLISON: Well, I think these companies are doing that. You know, they're starting to develop these strategies. Comcast has Xfinity, where they're offering content, not only online for free to anybody, but also, you know, content behind a walled garden for their subscribers.
So that's - you know, that's actually my belief, which is that cable and satellite companies are going to, you know, really take a hold on the consumer on multiple platforms.
They already have consumers paying today, and they might - those consumers might change what they pay for, but they're still going to pay for the content from those aggregators because they're already doing that today. They have that relationship.
And that's kind of the power of those companies. Not only do they have a relationship with the customers, but they also have a relationship with the content owner. So they can do deals, you know, in order to make that content available on multiple platforms.
COX: Well, there are a number of people who have gone away from cable. Steven in Sacramento is one of those. Steven, I want to talk to you about it. I want to get you on, but I've got to take a break first. So don't go anywhere. Hang on.
I'm going to read this email in the meantime. My family and I own a TiVo, and we never watch anything when it airs. We love the fact that we can watch without commercials. We also watch Netflix with a passion. If we have caught up on our TiVo, then we watch something on Netflix.
With the price hike, we have decided to only get the net streaming from Netflix - as previously we also had the DVDs coming into the house - and supplement our content with our local library's DVD library, which is free.
So really quickly, Farhad, the price is one of the things driving this, isn't it?
MANJOO: Yeah. I mean, it's a huge difference. If you were paying, you know, $60, $70, $100 a month to your cable system, or even more, you can get, you know, many, many options - perhaps not everything you can get on cable, but a lot of things, by supplementing it, by, you know, by getting Netflix or by getting Netflix or different shows from iTunes or Netflix and Redbox. You know, you have many options, and it'll cost you a fraction of what it used to cost you.
COX: We'll talk more with Farhad Manjoo of Slate and with digital media and marketing strategist Pam Allison in just a moment, and your calls, as well. Stay with us. I'm Tony Cox. This is TALK OF THE NATION from NPR News.
This is TALK OF THE NATION from NPR News. I'm Tony Cox. We are talking about the changing TV business and the new ways available to watch shows and movies.
To illustrate just how much has shifted to the Internet in recent months, Netflix announced in March that it's bought 26 episodes of a new program called "House of Cards." It won't air on any TV network or on cable or on satellite. Netflix will stream the show directly to viewers.
So tell us: How are you watching TV differently these days? Where are you watching it? Our number here in Washington, 800-989-8255. Our email address is email@example.com. And you can join the conversation at our website. Go to npr.org, and click on TALK OF THE NATION.
Our guests are Farhad Manjoo, technology columnist at Slate.com; and Pam Allison, a digital media and marketing strategist. She's worked with a number of companies you might recognize, Disney and DIRECTV to name two. All right, we're going to take a caller, and then we're going to come back to you, Farhad, for some more conversation about how this technology is changing the way we watch things on the little tube.
This is David(ph) from Denver, Colorado. David, welcome to TALK OF THE NATION.
DAVID: Hi, thank you. I haven't had a subscription to any form of cable for a couple of years, but the way I get by is through file formats like BitTorrent or some Websites that stream Videx format, which I know is - has been a shady area of legality.
And I'm curious, have you seen or heard of more people going that route in terms of just what's available on the Internet versus paying $70 a month for cable?
COX: Funny you should ask that question, right, Farhad?
(SOUNDBITE OF LAUGHTER)
MANJOO: The caller mentions that it's in a shady area of legality. Actually, it's illegal. And, you know, I stupidly, a couple years ago, I confessed on Slate that I had been getting a lot of my entertainment illegally that way. But a couple weeks ago, I wrote that, you know, I had stopped substantially using file-sharing networks because there are now so many legal options that are so easy to use that - and cheap - that kind of the hassle of file-sharing isn't worth it at all.
And I think we're noticing this in the numbers. A couple months ago, you know, an Internet traffic company reported that for the first time in North America, Internet traffic for Netflix had eclipsed Internet traffic for BitTorrent, which is the biggest file-sharing system for TVs and movies - TV shows and movies.
And so that seems to suggest that people are moving away from piracy or at least that legal options are getting so easy that, you know, we're spending most of our time on the legal stuff and, you know, not really bothering with the illegal and more - usually more inconvenient, you know, file-sharing networks.
COX: Let me take Steven. He's been very patient and hanging on. I appreciate that Steven, from Sacramento, California. Before you ask your question, Steven, my question for you is this: Are you taking, illegally, material, or are you doing it the right way?
STEVEN: There are a couple things that I just can't get. Most of the stuff is available online. But some of like the really premium content, like HBO specials and things like that, unless you're willing to pay a pretty hefty price, they're just really hard to get a hold of. So those ones are pretty much the only things I get illegally.
I gave up cable five years ago or something. But one that I use a lot is the broadcast television. I mean, you can hook up an antennae and get broadcast TV for free, and that's been really useful, complementing, you know, the live events that I can't get through Netflix or Hulu or something like that.
COX: Great, Steven, thank you for the call. Aren't cable companies, Farhad, trying to prevent that by delaying when those shows will become available elsewhere by a week or so? I'm thinking of Fox, for example.
MANJOO: I mean, in general, as Pam mentioned earlier, there's this sort of windowing strategy where, you know, the studios try to delay various content to - they try to reserve it for kind of the highest paying customers first and try to move it off to other customers.
But we're seeing these windows, you know, get smaller over time. And so, you know, one of the reasons that I don't - have sort of stopped getting illegal HBO shows is because usually you can get those on DVD pretty quickly, five months, six months. And so - and if you have Netflix, you know, you get it for free on Netflix on DVDs.
So, you know, there's so many options now that I think that, you know, you can stay legal and still not pay very much and, you know, watch a whole lot of stuff.
COX: Pam, what about sports as an area here, and content-wise, especially. Are they ahead of the curve, behind the curve in terms of offering programming that people want and are willing to pay for on other platforms?
ALLISON: You know, it's been really slow to take off. I mean, there's been some options of being able to watch sports online, but none have been very successful. You know, Major League Baseball has been extremely successful, obviously, with MLB.tv.
And, you know, the sports league strategy has been about creating offerings specific to the sports league, and nobody's really done well in aggregating that content. That actually is an area where I see an opportunity. You know, the challenge is that there's so many niche sports that, you know, maybe not a lot of people - and I'm sure someone will complain when I say this - maybe not a lot of people will want to watch cricket, you know.
Or I'm a big tennis fan, and, you know, Wimbledon had offered an app a few years ago to pay for streaming of the tennis matches online, but it really didn't do very well because it's such a small audience. But if someone is willing to aggregate that and partner with networks who are broadcasting it, I think that there is an opportunity, as live sports really isn't an area that anyone has ventured into very well, ESPN a little bit, but...
COX: What about the Olympics? That's going to be different in 2012 in London, correct?
ALLISON: Correct, you know, NBC I think learned a lot from their mistakes in 2008 in Beijing, where they didn't not only broadcast live on broadcast television, but they delayed content online, as well. You know, they're going to stream live in 2012. So I think we're going to see a lot.
And, you know, that's especially a great opportunity because, you know, not that I want to promote people streaming, you know, sports at work, but, you know, that's where a lot of people are where these - especially in the U.S., when the actual event is happening.
COX: We're talking about television and the evolution and revolution taking place technologically in television. Our guests are Farhad Manjoo, who is a technology columnist at Slate.com; and Pam Allison, digital media and marketing strategist who has worked with both Disney and DIRECTV. If you'd like to join the conversation, our phone number is 800-989-8255. The email is firstname.lastname@example.org. Let's take a call now. Chuck(ph) is in Aurora, Colorado. Chuck, welcome to TALK OF THE NATION.
CHUCK: I'm currently using Streambox. It's a product you can buy at any Best Buy or all of your defunct, what was it, computer - Circuit City and Computer USA. But you can buy it at Best Buy. And basically if you have a broadband connection and a cable connection, you can stream the video anywhere, anyplace, any device coming off that and control the channel.
So my mother pays about $220 for her cable. She gets every premium channel and everybody broadcast channel. And I can basically tap into that channel.
COX: And for nothing, right?
CHUCK: For nothing, for free. I disconnected from cable about two years, as well. For the callers that are saying that they can't get anything from the premium channels, they're just not trying hard enough. You can get any program, any DVD that's been on (unintelligible), that's been cracked. You can get anything from the file-sharing networks. They're just not trying hard enough.
COX: Chuck, thank you very much. You might have to give your mother some of that money she's paying for her cable bill. Let me ask you a question, Farhad. One of the things that has been written about - and that suggests that cable might be able to compete, actually, with this new digital technology and the revolution is that the quality that you get on many of these other devices is not as good a what you will get on your television at home.
MANJOO: Yeah, you know, that's true sometimes. I think it's getting better because people's Internet connections are getting faster. I mean, I have a pretty fast Internet connection at home and get Netflix streaming and high-definition quality that's as good as anything I get on TV.
The other thing I would say is that I really don't know if we see quality as being a selling point. I mean, I think that when - between - if you give people the choice between quality and convenience, I think we've seen people will pick convenience. That's the whole reason people love MP3s for music.
You know, they're not as good as CDs. Audiophiles don't like them. But the fact that you can take them around, and you can take thousands of them on your music player is the reason they took off. And I think that's, you know, that's the reason - you know, watching a movie on a small iPhone screen isn't as great as watching it on a big screen, but you're with your iPhone more often, and you can watch more movies that way, and i think people...
COX: Good point. Let's talk to Dave from Cincinnati, Ohio. Dave, welcome to TALK OF THE NATION.
DAVE: Yes. I just wanted to say that I had DirecTV as my last provider, and I got rid of it. I begged with them - before I got rid of my DirecTV, I said, is there anything we can do to lower this bill? I was close to $200 a month. And they said, no, there's nothing we can do. I've gone off the grid now, cut the cord, as you will, and am now using a combination of NetFlix, regular broadband HD television that you can bring up through the wire, and also some of the other sites that were - what was the guy, you said earlier, gray sites or whatever that might be, gray legally, but - I usually try to go in Hulu, as well.
But using a combination of all of those things, I can get everything I want for virtually nothing. And the thing about the small screens, I mean, if you have a flat-screen television, they all come with standard, with VGA hookups. And you just get a VGA cord from your local computer parts store, you're watching everything. And with a high-speed Internet connection, a lot of the shows they do on Hulu or NetFlix are already HD compatible - HD anyway, so you're getting great quality and just about everything you want for a fraction of the cost, like he has been saying. So...
COX: Dave, thank you very much for that information and for the phone call. Let's next go to Shane from Ann Arbor, Michigan. Shane, welcome to TALK OF THE NATION.
SHANE: Hi. Thanks for taking my call. I have to respectfully disagree, I think, with Farhad, because I think that even with all of the legal options that do exist, you know, from NetFlix to real DVDs to streaming from Hulu or the network's websites, is that - what people really want, I think, is - this has been mentioned, of course - is a combination of convenience, plus quality, plus content. And so I think the way that many people are responding, including myself and my wife, is, you know, we have just a reasonably priced, little $100 box the size of an external hard drive. And it just sits next to the TV and hooks up to the Internet, streams content from NetFlix, streams content from YouTube.
Some of the other ones like Boxee, I think, have content from Hulu. Even the televisions themselves are starting to have these things built in where, you know, they become network devices and they start getting content from any variety of Internet sources. And I think that what this really is a response to is the lack of flexibility and the lack of creativity from the cable companies, especially in terms of the low-quality of the DVR boxes, the low quality of the, you know, some of the content offerings. And so people are really taking things into their own hands and saying, I want to control, not only when I watch my content, but the type of content I have access to...
COX: What to watch. Right. Shane...
SHANE: Oh, go ahead.
COX: Thank you. Now - I was just going to just say thank you for the comment. I want to get a few more in here in the time that we have. By the way, we're talking with our guest Farhad Manjoo, who is a technology columnist at slate.com. And we're also talking with Pam Allison, who is a digital media and marketing strategist who has worked with Disney and DirecTV. And we're talking about what do you watch on television, and where do you watch it. This is TALK OF THE NATION, from NPR News.
So, Pam, one of the things that we keep hearing is there is this attempt to balance the technology with the content. And you've already said that the content is actually behind the development of the technology at this point. Who would you say is out front, though, in terms of the content that they are putting out that is in competition with broadcast television and with satellite and cable TV?
ALLISON: Do you mean, like, which companies are developing content...
COX: Yeah. Yeah.
ALLISON: ...for online? Well, you know, certainly, you talked about NetFlix and the deal that they've made. I mean, you know, I think Google is going to start to do the same thing. You know, there's a lot of content on YouTube that can be, you know, more developed into a series. And obviously, that's a huge destination for user-generated content. You know, and then you see kind of these smaller entities like Funny or Die or Babelgum who are creating content that's very, very popular online and driving a lot of eyeballs.
COX: Here's another email: I recently canceled NetFlix after the price hike, though I was already almost there. NetFlix, cable, whatever you want to touch on, et cetera, the real issue was selection, or rather quality, quality of entertainment and quality of streaming and lack thereof. I found myself more and more driven to the local rental shop down the street. I got to talk to someone. I get outside and I support local business. Farhad, that's not the standard, is it, anymore?
MANJOO: Well, the local rental shop, I don't think, is the standard. Just around my neighborhood, I've noticed that many local rental shops and Blockbuster has - have been shutting down. What - but the replacement, I think, for that is these DVD vending machines like Redbox, which are in many supermarkets these days and which are, you know, sort of combine the best thing about rental stores, which is their sort of instant gratification. You can get something immediately, but they're also kind of more - in more places, and they're hassle free.
So I bet, you know, I think that their - Redbox is one of the biggest - is getting sort of a windfall from NetFlix raising its prices, because rather than sort of sticking with the NetFlix DVD plan, you can stay with NetFlix's streaming system. And when you don't find something that you want on that - you know, the newest releases, for example - you can get that from a NetFlix - a Redbox box, and they're $1 a night. So it's, you know, a pretty good deal, and you can sort of supplement your NetFlix with actual DVDs from Redbox.
COX: I've got less than a minute left, and I forgot to ask you - my fault - about Facebook. They're in the game now, too, aren't they?
MANJOO: Yeah. I mean, they are getting movies and sort of more content from different providers. It's unclear what their kind of overall strategy is, as far as I can tell. But, you know, it seems that, you know, whatever they do, it's going to be big, just because they have hundreds of millions of people, nearly a billion people using the site. So whatever they do sort of will be destined to have a big splash on the entertainment industry. But it's just unclear yet what that is.
COX: Our guests have been Farhad Manjoo, the technology columnist at slate.com who wrote how Netflix is killing piracy. He joined us today from the studios at Stanford University. Farhad, thank you very much.
MANJOO: Great. Thank you.
COX: We were also joined by Pam Allison, digital media and marketing strategist. She has worked with Disney and DIRECTV, and she joined us from NPR West. Pam, thank you, too.
ALLISON: Thank you.
COX: Up next, banish left turns. No, really. Tom Vanderbilt offers up a new kind of intersection that he says is safer, more efficient and gets rid of left turns altogether. He'll explain next. I'm Tony Cox. It's TALK OF THE NATION, from NPR News.
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