Online television has been attracting a large number of players and investors looking to change the way television content is delivered. Most people agree that the current TV model is ancient and any firm that can crack the code will be able to reap the rewards of a significant shift in television viewing. Startups and established firms are all looking to solve the riddle and Variety now reports that Japanese giant Sony is also planning to the enter the online television space. The report continues to state that Sony’s business model may be highly disruptive to the cable industry.
Andrew Wallenstein, the author of the Variety piece, claims that the, “The Japanese conglomerate is in active negotiations with at least two major content companies about licensing their channels for a package that could roll out in the U.S. later this year.” The writers source also says that the negotiations are “far beyond exploratory.” When Sony was asked about the deal they did not comment on the issue.
The report says that Sony is creating a “virtual MSO” thanks to its use of broadband to deliver content. This means that geography will not limit the company like it has with traditional cable operators.
Sony has several good reasons to be looking into the sector. Like Microsoft, Sony has a game console in millions of homes that can be easily used to deliver television content. The Play Station game console already support online gaming and it would not be too difficult to utilize it to deliver TV programming. However, the Variety report does not specify if the PlayStation has any role in the online TV plans of Sony. It could be a completely new device that Japanese firm uses to enter the market place. The article does make clear that there will not be any pay per channel programming, which is something that many firms are looking at as the ultimate disruptive business model.
Apple and Microsoft have already tried to enter this market while Google and Intel are making fiber optic networks and virtual cable services to enter the space. With Sony as another player in the race the future of cable may be even more uncertain.
Source: MIT Technology Review
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