On May 4, Verizon began supplying Internet content to FiOS subscribers. Verizon FiOS subscribers can now watch Internet videos and listen to Internet radio via their cable remote controls and electronic program guide. The radio service is being provided by iHeartRadio. The new service, which adds to an ever-growing list of Internet content through FiOS TV, is free and automatically available for all subscribers.
The company’s goal is to add differentiation to its service from other cable/satellite providers. As cable and satellite companies struggle to stand out, new competitors are heating up the competition for eyeballs.
Over-the-top delivery systems are just starting to take a share of eyeballs from traditional providers, which includes over-the-air television. Video providers like Amazon, Netflix and Blockbuster have signed content deals to provide movies to those without cable/satellite TV service.
In addition, many TV set makers introduced new Internet-capable TV sets at this year’s CES. It remains unknown whether viewers will be satisfied with the, for now, less than stellar quality provided by some Internet-delivered content. Consumers may accept YouTube-quality video on a 15in computer screen, but it remains to be seen whether that’s the case when those consumer-grade images are blown up to fill large home-theater displays.
Apple under investigation
Did Apple violate a patent with its new iPad, iPod and other products? Yes it did according to a complaint filed by Elan Microelectronics. The U.S. International Trade Commission (ITC) has launched an investigation into claims by Elan Microelectronics that Apple's products infringe on Elan’s touch-screen technology.
Elan said that Apple's iPad, iPhone, iPod Touch, MacBook and Magic Mouse violate its patent No. 5,825,352, which covers "touch-sensitive input devices with the ability to detect the simultaneous presence of two or more fingers." Just at Apple announced its iPad, Elan launched a patent dispute against Apple. Elan later asked the ITC to forbid Apple from importing all five devices into the United States.
The ITC agreed that the complaint warrants an investigation, but said it "has not yet made any decision on the merits of the case." One can only imagine the heartburn a loss on this matter would cause Mr. Jobs.
Forget the FCC, now the FTC wants to control your Internet
Call it the law of unintended consequences, but it looks like Congress is about to further cloud the water on exactly which bureaucracy will have jurisdiction over the Internet. One version of regulatory overhaul, which was just passed by the House, would permit the FTC (not the FCC) to issue rules and impose civil penalties on Internet service providers.
An emboldened FTC would stand in stark contrast to Genachowski’s recently smacked-down FCC as to who can oversee broadband service companies. While the courts backhanded the FCC’s action against Comcast, the new legislation would permit the FTC to wade into the control arena. “If we had a deterrent, a bigger stick to fine malefactors, that would be helpful," said FTC chairman Jon Leibowitz to Fox News last week.
While the specific provisions that would strengthen the FTC’s hand are absent from the current financial overhaul legislation before the Senate, some observers believe such control will be included when the House and Senate versions are merged in the conference committee.
"Everyone is trying to figure out who is on first and what the game is here. Everything is a moving target right now," said Art Brodsky, a spokesman for Public Knowledge, an advocacy group.
Consumer interest groups are keen for the FTC to have greater clout in overseeing Web-related issues. Consumer advocates claim that online advertisers routinely gather personal data and are, or least could, abuse that information without adequate federal oversight.
ABC offers 99-cent programs
Bloggers discovered a test program between ABC and Ooyla where viewers could watch the show, “10 Things I Hate About You,” for 99 cents per show. Under the arrangement, ABC allows paid viewers to see the show, commercial-free, one day after it airs on the network. If someone doesn’t want to pay the buck, they can wait four days and see the program free, but this version has embedded commercials.
Will it work? So far, companies trying to develop a video version of iTunes have not been able to duplicate the audio site’s success. According to the "New York Times," iTunes users have downloaded around 375 million TV show episodes in the four-and-a-half years since Apple started to peddle TV fare. That’s fewer than 100 million downloads per year. Contrast that to Apple’s wildly successful iPod store, which downloads about 1.5 billion tunes per year.
Other over-the-top video providers — Roxio, Amazon, Netflix and Hulu — haven’t received a stellar consumer response either. Observers wonder if the Apple iPad may improve consumer views, once the more powerful version reaches shelves next month.
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