In the beginning, television programming was free to anyone with a television and an antenna. Unfortunately there weren't many channels to choose from and they were all loaded with adverts. Subsequently, cable companies found success by charging consumers to install an ever-increasing number of channels in their homes. But it still seemed like there was never anything good, and it was all still full of hype. Advanced telecommunications technology now allows consumers to access television and video content on demand via the Internet, as long as they have a broadband or high-speed connection. Increasing market penetration of broadband Internet services could lead consumers to abandon traditional television in favor of Internet-based video-on-demand distribution, and force producers of traditional television content to find new ways to keep profits on the wake of this change. Watching high-quality video content on a television screen via the Internet has become easy for the average consumer. Streaming video players, which connect televisions to the Internet and allow someone to easily navigate the vast sea of Internet video content, are readily available for purchase at electronics stores. One such product, the Roku 2 HD, retails for about $60 and allows access to hundreds of online video channels without subscription fees via a broadband Internet connection ("Choose Your Roku," 2011;" Roku channel store", 2011). Meanwhile, Cox Communications charges approximately $20 per month for a very basic programming package consisting of 23 channels (“Cox Communications,” 2011). Since Roku costs only the three-month equivalent of the most basic cable television service and does not require a subscription…half the paper…of which approximately $734 million comes from video (Perren, 2010, p. 74). Although advertising revenues for online videos are still limited, the number of people watching them is high and growing rapidly. In November 2010, the Washington Post published an article noting that Netflix's video service alone made up approximately 30% of all consumer Internet traffic during peak times (as cited in Kang, 2011a). With so many consumers switching to online viewing, it's clear that the industry will have to find a way to make it work. The consumer trend towards broadband Internet connections and Internet-based video on-demand services is clear. Cable companies will continue to lose their once-dominant positions unless they are able to leverage these new technologies to improve their customers' experience while increasing the value of their advertising space.
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