“U.S. consumers might get a break from the high costs of pay-TV subscriptions starting next year when several major providers plan to introduce streaming video on-demand services in what the broadband industry calls over-the-top (OTT) programming,” reports Paul Ausick of 24/7 Wall St.
The story continues, “The COO of CBS Corp., Joseph Ianniello, said earlier this month that the company’s Showtime channels are not restricted by any existing contracts with pay-TV providers from ‘doing something direct to consumer.’ ”
Ausick then says: “How much CBS would charge for that is not known, but to compete with Netflix and Hulu Plus the cost would have to be about $10 a month or less. That is a far cry from adding Showtime on top of a basic pay-TV package.” He adds that others likely to become OTT players include Verizon, Sony (which recently announced a deal to carry 22 of Viacom’s networks) and AT&T.
Ausick writes: “AT&T Inc. has what may be the most ambitious plan of all. Once the company’s proposed acquisition of DirecTV is completed, AT&T expects to bundle the satellite pay-TV service with a fixed wireless broadband service primarily to attract rural households. The company could deliver data speeds of at least 15 Mbps to rural subscribers, who are lucky to get half that now.”
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