IP: THE NEW "VAST WASTELAND". . .

[David Farber <farber () cis upenn edu>]

> X-Sender: usinet.isenb () pop5 attglobal net
> Date: Wed, 15 Mar 2000 07:45:13 -0500
> To: "Dave (private individual) Farber" <farber () cis upenn edu>
> From: "David S. Isenberg" <isen () isen com>
> \\ . .
>
> THE NEW "VAST WASTELAND" -- When TV over IP arrives, there
> might be nothing on.
> By David S. Isenberg -- http://isen.com
>
> In 1961, FCC chairman Newton Minnow saw the future of
> television. He called it a "vast wasteland," and he said,
> "When television is bad, nothing is worse." He was perhaps
> the first person to notice that broadcasting spawns lowest-
> common-denominator programming.
>
> Broadcast video business models today include the infomercial
> model, the familiar ad-supported programming model and pay-
> per-view. Of these, pay-per-view would have the best shot at
> quality, except that even pay-per-view demands eyeballs to
> meet return on broadcast infrastructure. My house just got
> 100+ digital channels from Comcast; I expected that we'd find
> a little Internet-style, random, risky zaniness. Instead we
> get twenty-four convenient times to watch "The Spy Who
> Shagged Me." No matter how many channels, there's still
> nothing on.
>
> Contrast this against the narrow-band Internet, a forum for
> wonderfully chaotic cascades of Web pages flowing from every
> enthusiast's cause, where content gains meaning from passion,
> and expression is not necessarily tied to the bottom line.
>
> Now TV over IP is on the horizon. Tens and hundreds of
> megabits to the home will soon be affordable, but if
> artificially constricted access dictates broadcast-like
> business models, television's wasteland will persist.
>
> PRIVATE COMMERCIAL ARRANGEMENTS
> That's why I'm bothered by a December 6, 1999 letter from
> AT&T to the FCC addressing choice of Internet service
> provider. It says AT&T is "prepared to negotiate private
> commercial arrangements with multiple ISPs ... [covering]
> pricing, billing, customer relationship, design of start
> page, degree of customization, speed, system usage, caching
> services, co-branding, ancillary services, advertising and e-
> commerce revenues, and infrastructure costs."
>
> If there were multiple competing ways to deliver tens of
> megabits to the home, an open marketplace would arbitrate
> access. But AT&T's stance is a problem if AT&T (with TCI and
> Media One, and resulting ties to Time Warner and AOL)
> controls the main means of U.S. broadband access.
>
> Imagine a future in which every player must make "private
> commercial arrangements" with AT&T to send or receive TV over
> IP. AT&T would be able to extract what economists call
> 'monopoly rents.' In this future, scale matters. The players
> would be AOL-Time-Warner, ABC-Disney and their ilk. In this
> future, AT&T would need ABC-Disney at least as much as ABC-
> Disney would need AT&T. We'd expect sweetheart deals among
> giants; a "big three" of TV over IP could emerge.
>
> People who weren't part of a commercial endeavor would be
> frozen out. Creative kids, expressive enthusiasts, musicians
> who aren't swimming in the mainstream, freedom-fighters and
> fringies under every government, and most importantly, the
> video makers among them (as PC-based digital video technology
> emerges) could find AT&T prices insurmountable, AT&T
> bureaucracy impenetrable and AT&T sweetheart deals
> unbreakable.
>
> COMMON CARRIER REGULATION
> When sweetheart deals between railroads and their content
> providers paved the road to vertical monopoly in the early
> 1900s, the U.S. Government brought railroads under common
> carrier regulation. This made railroads publish fair rates
> for transport services and open those services to all comers.
>
> Today, U.S. telcos are common carriers but U.S. cable
> companies are not. This frees AT&T to declare its intent to
> make "private commercial arrangements." The reason is
> historical; until recently, cable companies were not in the
> business of interstate transport. (The 'CA' in CATV means
> 'community antenna'.) Canada has been more vigilant; as
> cable's function changed, so did Canadian regulations. Today,
> Canadian cable companies fall under common carrier rules, and
> Canada is fast becoming the scene of a vibrant, competitive
> broadband revolution.
>
> It is important to note that an AT&T-owned broadband future
> is but one of several plausible alternatives, and that common
> carrier regulation is not the only antidote. Perhaps AT&T
> will fail in its ambitious cable buildout. Maybe another
> player riding another technology will predominate.
>
> My favorite future scenario features multi-provider, multi-
> access broadband. Perhaps low-cost broadband wireless
> techniques will emerge. Maybe a U.S. municipal fiber movement
> will take off. Perhaps DSL will grow mightier. Possibly (but
> don't hold your breath) power-line carrier technology will
> prove in. If there were two or three technologies and four or
> five providers in each region, a robust competitive market
> would be ensured.
>
> The narrow-band Internet will remain a forum for every
> enthusiast's interest because there are too many ways to
> connect for it to be otherwise. Common carrier regulation
> ensures this multiplicity.
>
> In the near future, some form of TV over IP is inevitable.
> When it arrives, I hope there's something to watch.
>
> [This article appeared in the March 1, 2000 issue of
> America's Network. Copyright 2000 Advanstar Communications.]
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> David S. Isenberg         isen () isen com
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