Evolution of Watching TV

television content. Now, I've already done episodes specifically about the early days of television and the birth of cable, but today we're going to take a step back and look at general trends and how they've changed over the decades.

So kind of how we went from broadcast to cable and satellite to internet delivered television, And what are the various not just technological challenges, but the legal challenges that exist in this world, the business challenges, And why is it that you can't just have alah cart I know that's the dream for everybody about getting a package where you have just the channels you want and none of the ones you don't want, because it seems like every

service out there it comes with a bundle, right, and you have channels that you might really like, and there might be a few channels that you really like, but they're not included in that bundle, And then there's a whole bucket load of channels that have stuff that you either have no interest in or you would actively avoid with every fiber of your being. You would never even dream of just channel surfing because it would mean going through too many channels of stuff what you do not want.

So we're gonna take a look at why that is, Why are we in that world? And it's not just about finding new ways to watch the latest episode of Supernatural though those when Chester Boys are indeed dreamy. The changes affect other important factors as well, like how is television monetized and how do we as consumers pay for that television. Now, for this episode, I'm largely focusing on the United States as the model, which is because I

live there. I'm I live in the United States. A lot of what I'll talk about also pertains to other nations, but there are particulars that will be different. So, for example, in the United Kingdom, any place that has a television that is either being used to watch television live or to record TV transmissions, no matter how those transmissions are sent, whether it's over broadcast, cable, satellite, whatever, you gotta pay a television licensing fee. I mean like individual households pay

a license fee for their TVs. Now, for those folks over in the UK, you're all listening to this and you're saying, well, yeah, that's true. But here in the United States that would be really unheard of. So Americans, if you head over to the UK and you decide, hey, I'm going to live here, now, you would actually need to purchase a television license to watch your own TV in your own home. But then in the UK, the British Broadcasting Company uses those license fees to fund their work.

So without the TV license you lose your precious doctor who, So just keep that in mind. But that's an aside. I want to talk about the evolution from broadcast TV to cable and satellite, to time shifting technologies, to internet

delivery and place shifting options as well. Now, later in this episode, we're gonna have a discussion with Jim shade Chatari of Sling TV to talk about how their approach is guiding us closer to that heavily desired a la carte strategy for getting television content, So that will come up a little bit later in this episode. Now, broadcast television starts before anyone outside of research and development labs

or enterprising inventors even had a TV set. Generally, most scholars agree that General Electric created the first broadcast station in January. Originally, they broadcasted under the channel designation to x B using a seven killer hurts frequency. Now, their broadcast was for mechanical television, not not electronic television. It's not the televisions that we know today, but the predecessors, the mechanical models that actually did use mechanical elements to

transmit pictures. And if that just blew your mind, you need to go back and listen to my podcasts called The TV Story. It was actually a three part series. So there's TV Story Story Part one, Part two, and Part four. Because you know we always skip part three. No, that's a lie. There's also part three. The first two parts really focus on the invention and development of television.

The first part came out on April and the second part came out on April, So check those out if you want to hear more about the development on the television set side, but let's focus more on just the concept of broadcasting. In September nine, General Electric behind to broadcast the first television drama on their station, which at that point was called W two x B. The actual drama's name was The Queen's Messenger, and it was described as a quote blood and thunder, play with guns, daggers

and poison end quote. And that I actually pulled from a website for the Early Television Museum. So great website if you want to learn more about some of the earliest forms of TV and broadcast. And frankly, that description makes it sound like The Queen's Messenger was a precursor to shows like Breaking Bad or Game of Thrones, But according to the website, it was not exactly high drama.

Most reports made it sound like the program was perhaps a little bit more ambitious and the technology could technically support. Some people said it was proof that quote radio moving pictures end quote weren't quite ready for the home. And yeah, that is what some people referred to television as early on, was radio moving pictures. After all, you were broadcasting these signals over radio waves, and the closest analog really to TV at that point was the radio. So not that

unusual or at least not that surprising. W two XB would broadcast its first electronic television signal a decade later, in nineteen thirty nine. Electronic televisions had been pioneered in the late nineteen twenties. Farnsworth. You probably have heard that name, Filo Farnsworth. He actually created electronic TVs and he features heavily in the TV story series that I mentioned a second ago. Our c A was heavily invested in electronic television.

In the early days. The company had been a dominant force in radio and owned two NBC radio networks. The company wanted to establish a dominant position in the burgeoning world of broad cast television, and so they invested millions of dollars to do so. That was a significant investment. I mean it would be today, but even more so back then because I think fifty million dollars in nineteen twenties money nineteen thirties money. That's that's a huge chunk

of change. Meanwhile, there was a competitor that was also interested in getting in the game. That would be Columbia Broadcasting System or CBS. There was another powerhouse in the radio world, and they were jumping into early TV broadcasts and created two newscasts a day. Each of those newscasts lasted about fifteen minutes, so this was quite some time before the twenty four hour news cycle, and these broadcasts weren't coast to coast. They reached a relatively small audience,

primarily in New York City. So these early early broadcast networks were very much local in nature, and in fact, that's how we would see television evolved at first, lots of little islands of broadcast TV that were mostly centered around cities, and if you didn't live near one of those cities, it became very challenging for you to get

any sort of content. There was a very little reason for you to go out and get a television because chances are you wouldn't have an antenna strong enough to pick up the signals, or the broadcast antenna wouldn't be strong enough to send the signals so that you could actually receive anything worth watching. So the early early days, this was very much an urban sort of form of entertainment, and it would only be later that we would see

ways of distributing it to broader networks. By the early nineteen forties, the US government was beginning to create regulations for the new television industry, and this would be an ongoing kind of back and forth between the US government and various providers, whether they were broadcast companies, cable company, satellite companies, or what have you. Part of this process meant that the government wanted to bust up some of the bigger companies like our c A. Then newly formed

Federal Communications Commission. The f c C went up to our c A and said, hey, we see you've got a couple of NBC networks. Do you need to knock that off? Dump one of them. You can keep one, but you've gotta get rid of the other one. So our c A did as it was told and spun off one of the two NBC networks, and that became a newly formed company that took on a new name. That new name was the American Broadcasting Company, or ABC.

Now ABC wouldn't really become a television broadcast company for a few more years, but then you get the three big early broadcast networks, ABC, CBS, and NBC here in the United States. Fox, of course, would follow much much much later. By the late nineteen forties and early nineteen fifties, commercial television was becoming a thing. Sponsored programs would feature frequent pauses to identify the sponsor and urge people to go out and buy the product. It could be incorporated

directly into a show. In several cases, even the NBC News in the late nineteen forties was sponsored by a tobacco company, and as such, the host, John Cameron Swayze was required to have a smoking cigarette in frame during every shot. He didn't have to have it in his mouth, but it had to be seen and it had to be lit. Enlightened times, ladies and gentlemen. The programs on television at that time were primarily extensions of previously existing

radio programs. So if you ever watch old Classic TV and then you find out, hey, there was also a radio show, well, chances are the radio show came first, and then they would end up adapting that into a television series, finding often that doing so was not always easy because, as it turns out, with radio shows, you have an unlimited visual effects budget because it is in the mind of the listener. If I do a science fiction series Ease or a Western, I don't have to

actually have any spaceships or horses. I can just create a little bit of sound effects and let the listener provide all the visuals. But if I'm going to do a television series, suddenly, I gotta produce some stuff otherwise viewers are going to be turned off pretty quickly. So it was a mixed bag, but it did mean that there were a lot of people drawing upon the experience of radio broadcasting in those early TV broadcasting days, and those three big broadcast networks were largely able to float

their television businesses by pulling from radio profits. So in other words, they were taking the profits they were making from one business and using it to support a second one. Because even though it was revolutionary, there wasn't a huge audience yet, there was not really an easy way to make a lot of money in TV because there just weren't that many people able to afford a television set.

So this was kind of a necessary evil in order to keep a very young industry afloat while its audience was able to start to coalesce and and grow, and it ended up working. It paid off big time, but it did take some time to do so. Now keep in mind television's at this time, we're still pretty expensive, and in order to get any use of them, you still needed to live somewhere relatively close to a broadcasting tower unless you had really innovative approaches to getting content

like people did and say Pennsylvania. But we'll get to that in a second. Now, it would be a good time, I think, to talk about how broadcast television works from a very very high level. First, in order to send a television signal out over the air, you need a certain amount of bandwidth in radio frequencies. It's because you're setting a lot of information out, the image information, the audio information for picture and sound, plus you want a

little room on either side to avoid interference. If you're talking about like a fairly modern broadcast that's about six mega hurts a bandwidth space on the radio spectrum, and again that creates a bit of a buffer so that you don't have two channels overlapping each other and interfering with one another. So in the United States, the government would dictate which frequencies could be used for stuff like television or radio broadcasts. They could also determine what the

other parts of the spectrum could be used for. And this is a way again to avoid having two different services try and use the exact same bandwidth and thus create interference with each other. It's a very orderly system to make sure that things run smoothly. Otherwise you would have amateur radio operators honing in and and booting off actual commercial radio stations or television stations, depending upon the power of the transmitter and maybe how far away you

happen to be from that transmission source. So in the United States, uh the government said that from fifty four mega hurts to the eighty eight mega hurts range, you would have channels two through six. Then you have to jump up to a hundred seventy four mega hurts to two hundred sixteen mega hurts for channels seven through thirteen, and then jump up again to four hundred seventy mega hurts all the way up to eight hundred ninety mega

hurts for channels fourteen through three. Now, the reason why there are gaps between six and seven and between thirteen and fourteen is because those frequencies had already been allocated to other radio uses, so you couldn't just shift everything over. That would require an enormous amount of work. So instead of shifting everybody, you say, all right, well, we've got this band of frequencies available here, We're going to allocate

that to these channels. Then we'll go up the spectrum until we can find the next wide band of frequencies that are available to allocate to TV again, and they did that a couple of times. As for the tech of the broadcast, it's pretty simple and concept. You have a camera and a microphone on one end that's capturing obviously visual and audio data, converts it into an electronic signal. That signal goes to a transmitter that's essentially a giant antenna.

You amplify that signal quite a bit and you send it up the antenna, which then converts that signal to radio waves. So you get these electromagnetic waves that emanate outward from the antenna. On the television side, you would have a receiving antenna that would pick up those incoming radio waves and then convert them back into a television signal, which gets amplified in the TV set, and then you're

able to watch your stories. Now, obviously it gets more technical than that, but that's good enough for our purposes, with not an episode to talk about the actual workings of broadcast TV. Just as commercial broadcas as television was getting its start, so was cable television. Now I don't mean cable channels, but rather using actual physical cable as a delivery mechanism for television signals. So in other words, we're not talking cable TV like MTV and UH, Comedy

Central and those kind of things. We're talking about just getting television signals using cables. Uh. This arose in three different areas in the United States, more or less simultaneously and independently of each other. It was in nine which is pretty incredible when you think about it, that it was that early, and it was happening in Arkansas, Oregon,

and Pennsylvania. And the three things that these places had in common was that they had some communities that were a good distance away from these urban centers and therefore could not easily pick up television signals. But they had populations that people who wanted to watch TV. So what's your solution if you can't really get a signal out to your house. Well, they decided to take a sort

of communal approach. H Essentially, the community would put up a big receiver antenna someplace that would get the best reception, like at the top of a really tall hill, and they would receive broadcast signals at this big antenna. Now that big antenna would be connected to a system that used cables to send the TV signal to distant homes.

So if you think about it like a regular television set, if you have a TV set at home and you've got a regular antenna set up, it's essentially the same thing, except the signal is traveling a much further distance in the cables than it would from the antenna to your screen. It's going through a cable that actually crosses the land or rather as usually strung up on utility polls, and so you can have people in very distant regions watch television.

They're getting the low coal broadcast, uh, they're picking it up from a centralized antenna that is then sending the signal out to these distant homes. It was a pretty clever way of fixing things, although it would cause some issues further down the line, and we'll talk about those towards the end of this episode. This idea of how do you how do you end up reconciling the broadcast side of this business with the cable side of this business.

But at the beginning, it was just a way of allowing people who otherwise would not have access to television at all to get that access. By the early nineteen sixties, there were about eight hundred cable systems in the United States with more than eight hundred thousand subscribers, and larger companies were starting to get in on the game. They were moving in on the domain that had been the arena for smaller businesses. This is kind of the story

of Comcast. I also at a show about that. If you search the tex Stuff archives, you'll find the story of Comcast, and you'll learn that a lot of Comcasts history involved the company buying up smaller companies, regional companies, and growing their own business that way, and they became a coast to coast business largely by buying up other companies. They didn't grow their subscribers just by convincing people to join Comcasts. They grew their subscribers largely by buying up

other companies that already had a large subscriber base. And they just kept getting bigger and bigger that way. And they were not the only company to do that, although that was of course the focus of my episodes. Now. Around this time, the FCC put some limits on what

cable companies could do. For example, they weren't supposed to run cables so that a person in one service area like a city, would be able to get access to the local programming of a different service area different So in other words, I shouldn't be able at this time be able to turn on my television in Atlanta and

watch local Chicago broadcasts. That would have been a no no around the early nineteen sixties according to the f c C. Now, one thing this managed to do was kind of put the brakes on the cable industry at that time, because now big companies were saying, well, it's starting to become a headache. I mean, there are all these little local broadcast areas where this makes sense, but we'd have to operate as almost like a franchise across the United States, and that was a little bit more

daunting of a task than having a unified approach. So it actually slowed down the deployment of cable TV in the US for about a decade. But in nineteen seventy two, the FCC decided ease back on some of those restrictions. They started to deregulate the cable industry and this would continue on through the next two decades. So this is also when the first pay TV network came about. That

would be the Home Box Office or HBO network. To learn more about that story, you can check out the three part series on the HBO story, the first episode published on May fen. Now, HBO's Passed is closely tied to the rise of cable television and the other network that really fostered the growth of cable TV in the United States, as in this idea of nationalized cable, not nationalized, but national cable in the sense that you could watch

content from other places on your local TV. That big network was w TBS, the Ted Turner Network, and along with HBO, this was suddenly an ability for people in very different places in the US to get access to the same content as opposed to relying solely upon their local providers, their local broadcasters. In nine four, the Cable Act further deregulated the industry, and there was an enormous

boom at that point in cable television development. But then we need to talk a little bit about satellite TV. Let's jump back again to nineteen sixty two. So we're back in the year where uh communities are are using cable to deliver television broadcast to remote locations. The f c C is just getting into the game saying, don't show stuff that doesn't belong to your region. Keep regions separate from each other, because we're getting into these disputes

that are really a headache to deal with. And around this time was when the United States launched the first telecommunications satellite. This one was called tell Star. It was a Bell Labs project. It was built by a T and T and it could receive signals from the ground from Europe and send them over across the Atlantic to

America and vice versa. But it was limited. It could only act as a sort of line of sight satellite, so that meant that it had to have a clear shot both from wherever it was receiving information and wherever it was sending information. And from a practical standpoint, that meant that the satellite could beam a live television feed for about twenty minutes every two and a half hours, because that's how long it took it to orbit the Earth. So you couldn't watch a full length movie in one

sitting using this thing. But it was kind of a dawn of a new era with this telecommunications approach. Tell Stars actual fate was rather unfortunate. The United States and the then Soviet Union had been in the habit of conducting high altitude atomic weapons tests, and those tests pretty much toasted the satellites systems. So it went offline permanently

on February twenty one, nineteen. Although it was still in orbit, it hadn't crashed to the Earth, but the electronics inside it were essentially fried, so there was no more TV being sent by Telstar one at that point. Now, it proved a point, but it wasn't really a replacement for broadcaster cable TV. In nineteen seventy six, there was a Stanford professor named H. Taylor Howard who built the first privately owned satellite receiving system, and he was a pretty

clever dude. His satellite antenna could pick up the same transmissions that cable networks were using to send signals across the nation. So while you didn't have individual customers using satellite dishes until this point to pick up this stuff,

cable companies were using it. So what would happen is you would have a cable company in one region and they would send a signal up to beam up to a satellite that would then beam it down to another receiving station much further away someplace where you don't have physical cables connecting the two areas, right, So might one might be in the East coast, one might be in the central United States, and the satellite would beam the signal down to the center well United States, and they

would also get the same programming as the folks southeast. Dead. This was a way that networks like HBO could distribute their content across an entire nation without having a physical infrastructure connecting coast to coast, and there was really no worry about anyone else tapping into it because I mean, if you had a receiver, if you had a satellite receiver, as Taylor Howard had because he built his own, then

you could get all that content for free. You wouldn't have to pay a monthly fee to HBO or to any provider. You're getting that information just by picking it up using an antenna. It was being sent in the clear or I t C, meaning there was no encryption or scrambling going on. So as long as you had an antenna capable of picking up the signals, you could actually watch that stuff for free, or at least for

the cost of actually putting together an antenna. But the reason for this was the reason why companies like HBO weren't concerned about this was that if you wanted to go out and buy a satellite antenna, you'd be spending thousands and thousands of dollars tens of thousands of dollars to get one of these things, and it was just largely considered to be impractical. It was well beyond the reach of the average person. So the companies like HBO

weren't concerned with us. Why would you worry about that. No one's going to bother with us until h Taylor Howard goes out and builds his own and he even I think somewhat cheekily wrote a hundred dollar check and sent it to HBO saying, Hey, I've been watching your content using my homemade satellite antenna, and I figure, you know, I should at least pay you for it, even though I don't have a cable subscription. And HBO's response was, hey, we can't accept this check. We only deal with big

networks or big big, you know, cable providers. We don't deal with individuals. So then Howard published a how to guide how he built his own satellite receiver, and that meant that any enterprising home engineer with enough money to buy the the basic parts could get to work and build their own satellite antenna and therefore receive HBO for free or minus the price of building the antenna. The satellite TV industry essentially started off that way. People started

to grab some signals meant for cable customers. But before too long two things happened. One, cable companies began to scramble their signals so that you would be incentivized, let's say, to subscribe to their service to get the ability to de scramble that channel and watch the content. And the second thing that happened was that the satellite providers were beginning to emerge as a competing industry to cable providers.

So you had the individual cable channels, the people who make, or at least who who produced the stuff that you want to watch, and then you add the cable providers, the people who have or the companies who have the infrastructure that delivers that content. This can get really confusing because we frequently will refer to cable just as cable, and we could either mean the provider or we could

mean the content creator. And to make it more confusing, there are of course companies that are both They are both providers and content creators, and that makes things messy. It's also one of the reasons why you've got people arguing for net neutrality to try and create a separation between the content creators and the content providers so that you don't see preferential treatment given to one company's own

products over all the other competitors. But I've already talked about net neutrality and other episodes, so we'll leave that from for now. Back to satellite TV. Uh, you started seeing these companies pop up with their own services, so you could, you know, subscribe to them, just as you would with cable TV, so dish and direct TV things like that, you could subscribe to them and get your

television that way. And I'll have to do a full episode on the satellite TV industry to go into how they evolved over time, But to be honest, to get into that story here would take up way too much time. It really deserves its own episode or pair of episodes. So let's just say it had its own challenges in those early days. That brings us to television over the Internet.

While there are many services that deliver video content over the Internet that I've been around for a decade or so, such as just streaming recorded video live TV over the internet that is still relatively young. Now one of those services is Sling TV. When we come back, I'll have a discussion with Jim Shade Chadar, the VP of Product Marketing and Management over at sling t But first, let's take a quick break to thank our sponsor and Jim Shade, thank you so much for agreeing to be on tech stuff.

I really appreciate it. I'm very excited to have this conversation. So let's say we're doing the classic elevator pitch. You get an elevator, there's a person there, you're you're going up to the floor, and it's not the express elevator, And of course conversation turns to, so what do you do for a living? How do you describe to someone what Sling TV is all about. Yeah, it's a great question. So Sling TV is the leading live OTT streaming service in the United States. Think of it as Netflix, but

for live and on demand TV. All the customers to do is download an app to their favorite device and they can watch channels like ESPN, A, m C, h G, t V, CNN Live on the device of their choice over the net. Cool. So it's following a very uh

proven model at this point. One of the things that a lot of people have said about services, specifically Netflix in particular, but services light Netflix, is that the thing they really nailed was this concept of making sure the application was available wherever people wanted a chance to use it, and so that it just became kind of ever present and you can find it on everything, to the point where I wouldn't be surprised if there are refrigerators and

stoves that have it on them now. So it sounds like this is a similar concept, but now we're looking at live television, something that previously you you were pretty much stuck to either over the air broadcast or cable or satellite service, and now you can get it through your internet service provider. Is that that more or less correct? Yeah? I think the way I would think about it is really about choice for our customers. And if you think about traditional pay TV, you are always locked into the

steptop box that came with that PATV provider. And so now if you you know, if you prefer Coo over Amazon, or if you like Apple TV, we're putting that choice back into customer's hands. You can use playing on any one of those devices. Excellent. So talk a little bit if you can about the process of coming up with the idea and rolling it out. What was that like, because obviously getting into this field, it's it's their challenges that I think the average person has no real knowledge of,

things like carriage agreements, things of that nature. And I'm not asking to get into particulars with any of that, but kind of let people know, Like when you're an average customer who wants to watch television, your question might just be, well, why can't I just get this? You know, why why did it take so long for it to get to me? And I don't think they understand the

complications that are that are surrounding such an endeavor. So can you talk a little bit about the development both maybe from not so much a technological side, we can talk about a little bit, but really from the the business side, what took to get this in place? Sure, I think you bring up a lot of great points.

Um when you when it comes to kind of content rights and digital content rights, they're really complicated and I don't think the average consumer definitely appreciate the complexity around them. So we started negotiating with our programming partners almost five to six years ago, way before we launched the service, because we knew that one of the pain points that we were trying to address was that customers didn't like

paying for channels that they weren't watching. And so it was very important for us when we launched pling TV to make sure that we launched the service to put the choice and control back in customers hands and dealt

with that pain point. And so we spent years basically negotiating with these programming partners, and we had the benefit of being part of Dish and this has had these programming relationships for you know, decades at this point, and we really worked with our programming partners to come up with a model where we could offer you a smaller kind of base pack of channels and let people choose different genre packs that they wanted sports or if they wanted kids, they could just add those on and still

have an affordable service and so um, like I said, the content rights are pretty complicated. So sometimes you know, you're not allowed to watch you know, football on a mobile device. It's not something we have control over because that's how the NFL negotiative rights with the carriers, or you know, some channels aren't available on some services, etcetera.

And so for us, it was really important to give customers a choice of the channels that they wanted, the things that we thought were going to be most popular, but make sure that they didn't have to pay for things that they didn't want or didn't want to watch. Right. So this this is kind of that dream of the Alakhart approach that a lot of people thought was going to be a natural progression once we started seeing the

possibilities of delivering streaming content over the Internet. But again that was largely without the the understand ding of how

the business side of it works. Once upon a time, how stuff works was part of Discovery Communications, and for me that was my education and learning more about things like carriage agreements and if it's a if it's a network of channels, if it's one big channel, there's also issues of if you negotiate with them, then you have to figure out, well, I can get that channel, but I'm going to have to get these other five channels on my cable package because it's all part of a

package deal and Once you see it from that side, the backside, you start to get a deeper appreciation of how as you say, how complicated this is. And that's before you get to the added restrictions of things like, well, you can watch this, but it has to be either on a television set or maybe on a computer but not on a mobile device. Or it maybe yes, you can have this, but some of the capabilities of your app, maybe you were able to do things like pause live

TV or rewind a little bit. They might work with the or the agreements might allow for that for certain channels but not for others. And once you see how complicated this is, you really get that appreciation of Okay, now I understand even though the technology existed, it still took years of development to get it all uh rolled out.

And as I understand it, when it first when it first rolled out, there were essentially two broad categories that you could take blue and orange, and that was sort of the base packages, and you could also choose to combine the two. Is that correct? Yeah, So, so from a services standpoint, we offered you know, Spling Orange and we offered Spling Blue, and they had some of the channels were the same between them, some of them are different. One had ESPN and the other ones had NBC and

Fox channels. And now we also offered you know, international language group choices and Latino choices. So Orange and Blue are the kind of the base domestic packs for you know, English speaking, and then we the Latino packs. And we also have a bunch of content in different language groups from Arabic, the Chinese to Polish, et cetera. So in I am sure that in your career you've already seen how the industry, how how really the delivery of content

has changed dramatically. It's something that I like to talk about a lot on my show from the era of broadcast, over the year two era of cable and then also cable and satellite, And would you say that it's you know, is it fair to say that the Internet delivery is kind of like that next era, that next step in evolution in the way we get content from UH, from major creators and channeled through to two audiences. I definitely

think it's it's an uh an evolutionary past. I think the one thing to keep in mind was that the the Internet's original purpose is not to deliver video, and

so although it is a natural kind of evolution. It is also a challenge to deliver live TV over the Internet where you know, we don't own the I s P. We don't own the end device that a customer has, right and then of course there are all the other issues things like you you can't really guarantee that uh, that the bit rate is going to be the at a at a level where you're going to get the quality that the home viewer expects, and that's completely outside

of your control. It's not like it's, you know something where sling TV just says, all right, well, I know you wanted to watch this program, but I'm gonna throttle it. It's not that it's it's all these other elements that are outside of that. But the flip side of that, of course is the convenience on the consumer side, the fact that you have these different options of ways to access the content. And I find I find that the

really compelling thing. What's the deployment like so far for Sling TV about I don't know how much you can talk about your your install base, but I was kind of curious to hear what adoption has been like. Yes, so unfortunately can give you specific numbers about our installed base, but you know, we are the leading last streaming offering out out there today. I think, you know, for us, we've seen kind of broad adoption across the different devices

were on. We've realized there's kind of this rule of people gravitate towards the largest screen that's in front of them. So if they're at home, you know, they were going to watch on their TV. If they're you know, on a subway somewhere, if they're traveling and the phone is the only screen in front of them, you know, we see a lot of usage on the phone because that's the biggest screen they have in front of them. We've

seen a lot of engagement from our customers. Um you know, if you look if we go back to two thousand, sixteen seventeen, I think we saw increase on a per user basis and the time within app. So, you know, I think if you think about splaying as a cord cutting or live streaming solution, I think people were experimenting, they were trying our service, and then at once they tried it, they recognized the choice and the convenience and the control that we give them, they started engaging more

with the platform. And realizing that they could really meet their injury him and needs, which plink TV. So this is also one of those offerings that might appeal to the so called cord never's the people who have never really subscribed to to cable at all, but now they could get that same sort of access to content only over the Internet, which is that's you know, that's kind of the the access point they've become used to with

other services. So I see this as really catering to that group as well, a group that otherwise seems to be unreachable through traditional means of getting you know, getting content to audiences. So it's it's fascinating to me there as well. It was one of those stories where again coming from a world where at one point I was part of a company that in part owned a large cable network and seeing the conversations going on there about

concerns of how to reach audiences. To me, this is a potential solution in that it is a different avenue. It's one that doesn't depend upon uh services that a lot of people just view as as being like you say, like like including offerings that you don't have any interest in, you know, why why do I want to subscribe to a one fifty channel cable package if I'm only watching a dozen or so of those channels. And this seems to be uh much closer to that Alakhart future that

a lot of people wanted. What do you see in the future, What has you excited over at Sling TV? So, I think, uh, when we look kind of to the future, there's a couple of couple of areas that we're focused on that I think are exciting. Probably not the sexist areas to think about, but I think so us we think about two main focus areas. One is just course stability.

Like I said, not the sexist area. But if you think about people and the experience have had with traditional pay TV, not like the customer service or the fees that pay, et cetera. But they know that when they tune to a channel, it's gonna play. And that expectation, whether your cord never and you've been using Netflix and Hulu or your cord cutter, you have that expectation that your experience, your entertainment experience, is gonna be reliable. That

you click on something, it's gonna play. You're not going to see a buffering wheel, and you know we were serving customers on a daily basis when they're using it, and we know when there's marquee events, you know, we bring in a ton of customers just to watch those events, and it's critical for us to make sure that the

service delivers the experience that they want. We talked about earlier delivering live TV over the Internet is not a simple task and a lot of people are trying it, and I think what we've learned over the last three years is that stability is really important um for customers to not only jump off to the service, but to stay with the service. And then I think the second area is really around contum discovery. We give a lot

of choice and control to customers. They can mix and match the channels they want to create their own entertainment experience, but we gotta make we're making sure that TV is simple for them. Um. You know, that's a pretty fragmented experience out there if you're in consumer or customer and you're thinking about all the different places you can go to watch TV. And one of our focus areas for two thousand eighteen is how do we make it simple?

How do we aggregate that content that customers want, whether it's core channels, it's premiums like HBO and Stars, or it's even over their local channels. How can we produce kind of a single interface and make it simple for customers? Again, Yeah, I've I've talked on this show before about how user interface design is uh a fascinating area and it's it's so much more challenging than you might actually think, you know,

on on just casual glance. And the example I always give people is, I say, think of all the times you've heard of a product or service that sounded really compelling, but then when you've got a chance to use it, it was so so difficult to access for whatever reason that you walked away from it. Creating that that magic user interface that just invites engagement is that's that's something that a lot of different companies have really, you know,

struggled with and and experimented with. And obviously it's always evolving and changing, especially as the product itself evolves. So I wish you guys the best on that because I know it's a challenging endeavor, but I'm also excited to see how it turns out. So I have to ask you, now, this is the big, important gotcha question of the interview, What's what's your favorite show? It's interesting, I think right now I would have to gravitate towards this is us No. Nice, nice, Okay, alright,

you pass. Acceptable, fantastic. I have to thank you again for being on the show talking a little bit about this service. I'm really fascinating to take a deeper dive into it. And and again, uh, it's nice to get that perspective and that understanding of you know, the technology side of it is always complicated, but that's something that's easier to solve if you just stick with it. It's the business side that's that's like a a super intricate web that you have to unravel gently in order for

this to work. So I greatly appreciate you taking the time to talk with my listeners. And uh, I'll you know, you're free to come on the show whenever you want. We can chat about what's good on TV. Yeah, all right, thank you appreciate having me on board. Big thanks to Sling TV for joining me to talk on this episode. When we come back, I'm gonna talk a little bit more about carriage deals and some of the other challenges that we see with the way we get television today.

But first let's take another quick break to thank our sponsor. All right, guys, Sling TV is one of many services that are competing in the live TV over the Internet space. There are competitors like direct TV now, there's YouTube TV, there's PlayStation View, there's Hulu with live TV, and these services all seek to appeal to cord cutters and coordinators alike by offering up options to get television programming over the Internet and again to try and get to that

a lakhart approach. Now, I mentioned in the interview that one of the big challenges out there, and in fact this was what they were talking about two, is just the agreements that need to be in place in order to carry content over a service. As it turns out, this is a really tricky, tricky situation. It's it's challenging and it has been for decades. And the reason for

that is this agreement called carriage. Right, these carriage deals, this refers to a content provider or rather a signal provider, if you will, to carry certain types of content and what they have to hey in order to get access to it. So let's separate them out by the creators and the providers the service providers, the creators, the content creators, or at least the people who are companies that own this content, whether they made it or they contracted to

have it made for them or whatever. They've got the stuff people want to watch. The providers have the connections that can get stuff to customers, because generally speaking, the creators don't have a direct line to their audience, they rely upon providers. The providers traditionally have to pay to be able to carry content to their customers. The customers pay a subscription to the providers so that the providers will give them the stuff they want. So I'm a customer.

Let's say that I am a customer of Cable Company A, and I pay a certain amount per month to Cable Company A to get a bundle of channels. It's the basic bundle. I'm going bare bones local channels and small collection of cable shows or cable channels. I should say. Cable Company A takes my subscription money and all the

other subscription money that's part of their revenue. They also look at their costs, and part of their costs is the carriage deals that they have struck with various cable networks, and cable networks will end up negotiating a fee for

a per subscriber basis. Typically, and this has caused some big problems in the past, but sometimes they will negotiate not to have a higher fee, but rather for the cable provider to carry additional channels, secondary channels that perhaps the cable provider otherwise would not carry, and this ends up creating more of an audience for those secondary channels. So I talked in the interview about how how stuff works was once part of Discovery Communications. We Discovery Communications

has several different cable channels under its umbrella. You've got the Discovery Channel, you have the Science Channel, you have t l C, you have other channels. And typically a company like Discovery Communications would go into a carriage deal discussion and say, yes, we know you want Discovery Channel. We realize that that is a valuable property to you, and we have agreed upon what the cost should be for you to get access to our content to send

to your subscribers. If you're going to do that, you also have to take the Science Channel and TLC as part of the deal, and then your subscribers are going to also have access to those channels. So what it means is that a big channel that's got a lot of viewers, if they've decided they want to invest in a smaller channel and perhaps grow that business, then they can use their leverage to have a cable provider include

that channel with their service. Why would you get into a smaller channel, Well, here's why publicly traded companies depend upon growth. Growth is kin to success, right, that is, that's how we measure success with publicly traded companies. Typically, it's not just how much profit did you make, it's how much did you grow year over year? Not not just how much did you make this year, but how much more did you make this year from last year.

Eventually you're going to reach a saturation point with your channel. You're you're gonna hit about as many people as you're ever going to get. Your channel is not likely to grow much beyond that. It may mean that you've hit

essentially everybody's television already, so there's nowhere else to grow. Well, if you can't grow with your primary channel, the next best thing to do is to create a secondary channel that can then grow, and as a result, the entire company benefits because while your main channel can no longer really add viewers just because you've you've hit that saturation point. Your secondary channel has just started off. The sky is the limit. You can grow your your audience by leaps

and bounds year over year. And remember in the early days, if you have a small audience and you double it, well, it's not impressive if you're looking at raw numbers, but from a percentage basis, it's incredibly impressive. If I say, oh, we went from viewers to five viewers, that's not a big deal. But if I say, oh, we increased our viewership by then everyone's suddenly thinking, wow, that's amazing. So that is kind of the thought process that goes behind

this bundling approach. It's also one of the reasons why when you subscribe to cable, even if you're getting a basic cable package, you may find yourself with access to channels that you really didn't have any interest in. And it's not that the cable company the provider necessarily thinks that you're going to have interest in all those channels, but rather that the big names in the game own

those channels. Right those are all secondary or subsidiary channels of this bigger channel, and part of the agreement for the provider to be able to carry that primary channel, that big one that everybody wants, is that they have to carry all those smaller ones. Now. Sadly, what this means from a consumer standpoint is that we get this feeling that we are completely inundated by channels we just don't care about, and we end up looking at our

cable bill and our cable bill gets higher and higher. Right, those cable prices are pretty expensive, even for basic channels. They tend to be pretty expensive if you're going through traditional cable service, and the implication is, I am paying, you know, more than a hundred dollars a month, let's say, for four channels I want and fifty channels I don't care about, or more, depending upon what your basic cable

package happens to be. And that's very frustrating. And in our minds, we're thinking, Hey, if I could just cut that down to those four channels, think of how much more money I would save. Plus I wouldn't be so irritated that I've got all this useless stuff on my TV that I don't care about. But that's not the way the industry works because You've got these these big companies that own multiple channels, and they all are pushing

to have those channels included in these carriage deals. Meanwhile, you can get into these disputes where a company can ask for more money per subscriber than the cable provider was willing to give. There was a big one in two thousand nine. There was a dispute between Fox and Time Warner Cable. And from what I recall, Fox wanted to get a monthly fee of around a dollar per subscriber. For Time Warner Cable to say, all right, Time Warner Cable, you want to carry the Fox network on your service.

We want a dollar per subscriber to Time Warner Cable in return, and then we'll make this deal. Time Warner Cable said, whoa, that's kind of steep. We were thinking more like twenty cents per subscriber, so maybe one fifth of what you're asking for. Neither party really wanted to budge on this, and they didn't just try to settle this negotiations. They actually took it to the public. There were pr campaigns both from Time Warner Cable and from

Fox that were aimed at Time Warner Cable customers. The Fox was saying, Hey, Time Warner Cable customers, t WC doesn't want you to see our shows. So if you want to watch our shows, like if you like the Simpsons, I tell you what, maybe you should look at a different cable provider because Time Warner Cable just doesn't have your back. Man, you should just you should just ditch them. Meanwhile, Time Warner Cable is saying, Fox doesn't want to be

on your chancel on on your service anymore. And if we if we capitulate to their demands, that means we're gonna have to raise your subscription price. You're gonna have to pay more because it's gonna cost us more to have Fox on your network. So and we don't want to charge you more money. Come on, man, we just

want to get your stuff to you. So you have these two different public relations battles going on at the same time, and ultimately they both settled out of public view for a fee that was never publicly announced, So somewhere probably between twenty cents and a dollar per subscriber, as my guest, but who knows what the actual number is. Anyone in the deal knows, but anyone outside of it probably doesn't. So that's the way that this can get

really ugly with these carriage deals as well. All of that was to say that going with television over the Internet has these same issues. It's not like TV of the Internet is uh has got a blank pass two show you anything and everything. You can't just sign up and say I want these six channels, I don't want anything else, because again, they have to follow the same

rules as cable and satellite providers. This is largely because in the United States, at least, there are all these different rules and regulations in place to protect industries from what is considered to be unfair competition. Cable and satellite channels or providers rather have to follow these rules that have been set up in order to create one it's

supposed to be a fair playing ground. You could argue that that's not really the case since there are so few major providers in the United States, but that's what's supposed to happen. The Internet providers also are supposed to follow those rules because without it they could run rampant, and in fact, there have been some pretty big cases involving stuff that is kind of in a gray area.

Between these You may remember when I was talking earlier in this episode about people in Pennsylvania and Arkansas and uh, you know, using these cables connected to antenna so that they could get access to stuff that otherwise they would not be able to receive because the signals are too weak for them to pick up on their home television sets. There was a company called Areo that launched and the two thousand twelve and went out of busines this in

two thousand fourteen. And the reason when out of business wasn't because of lack of customers, but because it encountered legal problems. What area was doing was offering up a service where you can subscribe to the service and get access over the internet to live television stations that were

picked up by local antenna. Uh not your antenna, but the business is antenna and they had set up antenna originally in New York City, and so you could subscribe to this business and get access to live TV picking that was being picked up by these antenna. And there were service providers and uh, content providers who said, this isn't fair. We can't get compensated for this. There's no carriage agreement. And Ario's argument was saying, well, we're just

using antenna. We're using broadcasts that are over the air. There's no limit, you know, there's not anything here that should be a gateway or a wall between the customer and the content. So it's the exact same thing as if the customer had set up his or her own antenna in their own home. All we're doing is just sort of creating a middleman approach where we've got the antenna, but the customer still gets to see stuff that's over the air. It's not like we're descrambling signals or anything.

This is all in the clear broadcasts. But the various industry group said, no, you're you you're charging a subscription fee for the service and we're not seeing any of that, and we don't have any of these carriage agreements. You're acting more like a cable provider than you are anything else. Uh. And if in fact this we're just a case of using an antenna, then there's already a solution there, right.

The person can just go out and buy an antenna, never mind the fact that, depending upon where you live, you may not be able to get a good signal over the air using an antenna. That was the argument, and Originally some of the lower courts agreed with Area, but eventually this went all the way up to the Supreme Court, wherein a six three decision, the Supreme Court came down and said, you know what, Area, you don't

have a leg to stand on. You you are acting more like a cable service provider as opposed to just an antenna, and therefore you are not allowed to practice business in this method anymore. And so the company ended up folding. He said they could no longer do that kind of business. There are similar businesses that do rely upon an actual consumers own UH feed. So, in other words, there's slingbox, not to be confused with sling TV, and

slingbox is a streaming media service. It's a device that's actually UH allows you to watch your television no matter where you are. But this relies upon the feed that's going into your home. It's not like it's a system that is connected to someone else's antenna. It's connected to your cable box or satellite box or whatever. And the way it works is that the incoming signal can then be sent over the Internet to the receiver. And the benefit of this is you can watch your local television

even when you're away from home. Now, there are some issues with this as well, because depending upon the content you're trying to watch, there are blackout agreements that can make this a little muddy. So, for example, is sports.

If I happen to be traveling to let's say ce S and I want to watch a Braves game, which would be weird because it would be in the middle of winter and baseball doesn't happen then, But follow me, because we don't have the Thrashers anymore, so I don't really have any other sports I would watch, um, but I want to watch local sporting event while I'm in

Las Vegas. Usually I wouldn't have access to it because that would have this regional agreement where a very specific broadcaster would be allowed to show that, and it would only apply to a specific region and not outside of it. Now, I live in that region, but I wouldn't actually be there at the time. I'd be in Las Vegas. Using slingbox, what I could do is tune into my local television, the TV set that's actually in my house, change it to whichever channel I want to watch, and watch the

game that way. Even this approach has received some resistance but you could argue that this is much more clear cut case than the area approach because it's all relying on services that you, as a consumer already subscribed to or already have access to. It's not giving you access to an outside antenna. It is literally the services you

are getting as a customer somewhere else. Now, some people would argue you should just stick with Internet over or television over internet services, and you're a little more limited because you're not gonna get a lot of localized stuff this way. But at the same time, you don't have to worry about these weird carriage deals. And like I said, this doesn't have really that much to do with technology. It has to do with business and competition and the

fear of competition in some cases. And it also shows just how messed up a world our content delivery system is. It is incredibly complicated, and it involves a lot of very big power players in this space, all working very hard to maintain their spot of dominance. It's getting increasingly difficult. As we've seen in the cable industry and the satellite TV industry, we're starting to see more and more users

kind of ease off of those those standards. So we're seeing more chord cutters moving away from cable TV and away from satellite TV and moving toward either going over the air and just picking stuff up over antenna or using internet delivery systems, and I suspect we're going to

see that trend continue. It may not mean that we'll see a huge adoption of these live TV over internet services, largely because I think many consumers are going to see them as being prone to the same problems that they see in the cable business, although the price might be lower, in which case people might say, well, I'm gonna I'm still gonna get channels I don't want, but I'm paying

less for it, so that we may see that happen. Uh, We're also seeing, you know, a lot of resistance now with so many different competing services out there, this concept of I wanted to go to just internet, but when I add up everything, it's cost me the same amount

as getting cable tv. You know, if I'm using Amazon Prime and Netflix and Hulu on top of some live TV service, that all adds up after a while, and it just shows that this really is a lot more complicated than just saying I'll take these three channels and you can leave the rest. Will we ever get to that. I doubt it, at least not not anytime soon. There's there's too many players with too large a stake in

the game to go to that. And ultimately, we consumers are actually revenue generators and no company wants to limit the amount of revenue they create. Kind of kind of freaky, but as I understand, that's how business works. I don't know, I'm just a tech guy. Well, that kind of wraps up this conversation about how the delivery systems for television have changed over the years. I didn't really get into time shifting. That obviously is another big element that has

uh complicated matters. That's of course, when you record a show and you watch it on your schedule as opposed to when it originally airs. VCRs were kind of the start of that, but DVRs really pushed it because then you had an easy way to get into a show and then bypass stuff like advertising, which brought the question the whole monetization model for TV and really shook the

industry quite a bit. And uh, it's still one of the components of television that has people in the industry worried because if you suddenly take away the revenue generator, the whole concept of using ads to support the production of television, eventually you run out of money to produce stuff, and so we could ultimately find ourselves in a a

low point in TV production. Some might argue that the reality television era was already evidence of that, although we've seen some pretty phenomenal TV come out since the reality television boom, so I don't know that that argument is entirely uh with merit. But who's to say. It's a complicated issue, and maybe one day I'll be able to get like a real expert in the industry to break it down in a way that we can all understand,

because goodness knows, I still get confused. If you guys have a topic you would like me to cover in a future episode of tech Stuff, please let me know. Send me a message. The email addresses tex Stuff at how stuff works dot com, or you can drop me a line on Facebook or Twitter handle both of those tech stuff hs W. Remember we are on Instagram and you can watch me record this show live on Twitch

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And I would love to see you there and I will talk to you guys again really soon for more on this and thousands of other topics, because at how stuff works dot com