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The NYT today reports that
At least three of the biggest broadband providers — Comcast, Verizon and Adelphia — are striking deals for television programs, music and video games that cannot be readily found elsewhere on the Web. In this way, they are applying the cable TV model to the Internet by providing a distribution vehicle for entertainment programming. But it is not clear that this is the best strategy:
Not all broadband providers are making bets on proprietary content. Some, like EarthLink, BellSouth and Cox, are sticking to their technical roots.
“Exclusivity is one of many competitive strategies to consider, and you have to be very thoughtful about it,” said Bob Wilson, senior vice president for programming at Cox. “Otherwise you and your competitors can end up just trying to ‘out-exclusive’ each other, and all you accomplish is bidding up your costs and making the content providers rich.” Naturally, yelping is already being heard in the land, but from here it looks like a creative response to technological and market changes. Place your bets, ladies and gentlemen, and let the great Schumpeterian wheel spin.
posted by James DeLong @ 9:23 AM | Markets: Business, Investment & Innovation
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