I have written in this space that in a best-case scenario, OTT video threatens and has the potential to radically disrupt the broadcast media model used by traditional MVPDs. Before this happens, MVPDs will try to absorb the disruptive technology so that it conforms to the existing business model. It is this context that I see the pressure on MVPDs to move toward a la carte programming tiers, and also a recent new item concerning the effort of one prominent online video distributor, Netflix, to form alliances with cable operators. Under this model, Netflix would become another premium movie channel, like HBO. Netflix’ move is motivated from the cable side by cable’s “TV Everywhere” initiatives, such as Comcast’s Streampix and Verizon’s partnership with Redbox to compete with Netflix.

“If Netflix could transition its subscriber base to cable, and attract new subscribers to a premium service, that could mean more revenue for cable operators including Comcast to woo cord-cutters back to the fold, and forge a new path to long-term survival for Netflix. It could be a win-win for strange bedfellows, who may find themselves snuggled up, streaming (and dreaming) of new revenue opportunities together.”

I am going to participate in a panel discussion at the Broadband Communities Summit on April 25. Here’s the agenda.

The current (January/February 2012) issue of Broadband Communities Magazine includes my second article on online video distribution. Both articles deal with the failure of courts and regulators to allow online video distributors or OVDs to take advantage of regulatory benefits available to traditional cable operators. The first article deals with a small start-up company called ivi and can be found on my website. The second article deals with an OVD called Sky Angel and can be found here.

I am re-reading Yochai Benkler’s 2006 book, The Wealth of Networks, which is (broadly) about how non-market production by means of cooperative social systems – enabled by the ubiquity of personal computers and the Internet – can replace or at least restrain market-based distribution of information. Benkler describes the transition from an “industrial information economy” to a “networked information economy.”

These days, I seem to have reached a stage in life where it’s important for me to re-read some of the first books I read, back in high school. Thus, over the past two years, I have re-read many of the novels that during adolescence formed my gateway into serious literature: Tolstoy’s Anna Karinina, War and Peace, Dostoyevsky’s major works, Flaubert’s Madame Bovary and Sentimental Education.

Online Video Distribution (OVD) presents a long-term threat to the traditional broadcast model of information distribution, and this is why traditional MVPDs (multichannel video programming distributors such as cable operators and satellite television providers) are attempting to control the future of OVD via various “TV Everywhere” initiatives. As we draw nearer to the tipping point at which cable TV gives way to OVD, we will see various bumps along the way, some of which will be good for consumers.

For example, a la carte programming tiers may be one indirect benefit of competitive pressure being applied to traditional MVPDs by online video distribution.

Consider these news items...

After more than three months of negotiations with Insight Communications and Time Warner Cable executives, the city of Louisville, Ky., agreed to a $3.5 million franchise agreement with Insight on Friday.

An SNL Kagan report says that during the second quarter of 2010, cable lost 711,000 subscribers, with 6 of 8 MSOs reporting their worst quarterly subscriber losses ever – compared to a 378,000 gain during the same period the previous year.