"INFORMATION WANTS TO BE FREE":

The Price of Free (NICHOLAS CARR, 11/15/09, NY Times)

A few months ago, while stalking the aisles of my local Best Buy, I gave in to techno-temptation. I bought a Blu-ray player. What I didn’t realize until I unpacked the gadget was that it does a lot more than just spin high-definition discs. It is, as they say, Web-enabled. As soon as I plugged it into an outlet in my living room, its built-in WiFi antenna sniffed out my home network and logged on. The Blu-ray player became a gateway between the Internet and my television set.

Ever since, and much to my surprise, I’ve been using the device more to transmit Internet content than to play discs. I stream TV shows and movies from Netflix, music from Pandora and videos from YouTube. Beyond my existing $11-a-month Netflix subscription, I haven’t forked out a penny for any of this programming. It comes flowing out of the Web, whenever I summon it, free.

My new viewing habits must make Brian Roberts very nervous. The more I play movies and TV shows from the Web, the less I use my cable TV service. I almost never order pay-per-view movies anymore. And I recently canceled my premium Showtime subscription. Most of Showtime’s best programs, including “The Tudors,” “Weeds” and “Dexter,” are available to stream through Netflix, as are a lot of the movies currently playing on Showtime’s Starz network. Why pay $23 a month when I can get the stuff for almost nothing?

I have a feeling that it won’t be long before I and a whole lot of other people start asking similar questions about pay-TV subscriptions in general.

There's a risk here for the content providers. The pay-per-view option is a dead man walking, but we're all accustomed to ads being intermingled with our shows, magazine articles, news stories, etc. If they take the lead and make it easy for us all to stream what they provide with the ads still included, they can keep making money. Most of us would prefer to be doing these things legitimately and don't mind the advertising. But if they delay for long enough, we'll get used to ad-free fee-free content and then where does their revenue come from?

Posted by Orrin Judd at November 15, 2009 8:45 AM