TiVo and YouTube set to make waves
The TiVo/YouTube tie up announced earlier this year has come to fruition with TiVo now porting YouTube’s Internet video content direct to television. The software upgrade to Series3 and TiVo HD DVRs which enable the new feature are currently being rolled out across the US. Upon access to the service, TiVo users will be able to search, browse and watch hundreds of millions of User Generated Content videos. This development is seen as a significant threat to ISPs, advertisers and broadcasters alike. It is also a competitor to the much-hyped Apple TV.
Advertisers are threatened by this new development as it provides another option for consumers to be entertained without being required to watch ads. ISPs are worried as it undermines their efforts to gain revenue from providing both access and content. Broadcasters are also watching mindfully as YouTube evolves into a serious competitor and encroaches upon their traditional broadcasting turf.
The arrangement is likely to be a significant and much-needed boost for TiVo, which has experienced a number of substantial challenges in recent years. The DVR pioneer took a big hit in subscriber numbers last year with the decision by DirecTV to offer its subscribers (which accounted for two-thirds of TiVo’s subs) an alternative DVR brand. TiVO now only boasts 3.8 million subscribers (down from 4.3 million in 2007). The arrangement with YouTube and its associated software upgrade, will give it a substantial advantage over the standard-issue cable DVRs. It will also have an edge over AppleTV which doesn’t allow the viewer to record TV and skip commercials.
Of some concern are the suggestions that the ISPs will increasingly use bandwidth caps to prevent the TiVo/YouTube venture, and similar arrangements, from eroding the ISPs share of the content market. Again, this highlights the role for antitrust law, and the need for network neutrality protection, to prevent IPSs from dampening competition and consumer choice that should be the hallmark of online content.
For more information on developments in TV and Internet convergence in the USA, see USA - Convergence - Digital TV & IPTV.
