Report: Bright Future Ahead for Internet-Via-Cable Services

Although only a handful of cable TV operators offer Internet service via television sets today, the cable industry will dominate the “Internet-on-TV” service market within the next ten years, according to a new study by SRI Consulting.

SRI’s “Internet on Television” report said that fewer than half a million consumers worldwide currently subscribe to an Internet-on-TV dial-up service such as Microsoft-owned Web TV. And while the total number of subscribers worldwide will grow to 12 million by 2002, SRI said that beyond five years cable TV-based services will surpass dial-up services.

The study explained that most subscribers will expect Internet-on-TV
service to be more like an extension or feature of regular television
service than merely a new way to access today’s Internet.

“Although the cable-TV industry is getting a late start in this market, it
has quite a few competitive
advantages over other network service providers that will give it a boost
in the long run,” said David Rader, senior consultant and lead researcher
on the Internet on Television study.

He noted that cable networks have strong ties to TV programmers who can
help develop Internet-on-TV entertainment content targeted toward TV
audiences, as well as greater bandwidth to allow cable TV operators to
speed up downloads and offer new applications that employ high-quality sound and video. These advantages will fuel their success in
the Internet-on-TV market, according to Rader.

Countries with competitive cable TV industries such as the United States, England, Canada, France, Denmark, the Netherlands, and Belgium
will see the highest overall penetration of Internet-on-TV service, the study predicted.

Other factors that should boost the market for Internet-on-TV are high overall Internet use and low cost for making local phone calls for dial-up access.

SRI Consulting is a wholly owned subsidiary of SRI International, a global research, technology development, and consulting firm.

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