Wednesday, May 25, 2011

What ailment faces video-on-demand?

Let me tell you straight on; its broadband cap.

As this article from GigaOM shows, the recent cap by AT&T will limit users to 150GB per month. Additional 50GB would attract another $10! The problem is that if people decide to skip the big screen for a home experience, they will prefer to watch it in HD. As the article shows, a normal 2 hour movie at 720p is about 3.7 GB. Obviously, we aren’t even talking about 1080p which would almost double the impact.

This looks fine; except that watching movies is not the only activity people carry out on the Internet. Here's a handy chart for 10GB usage which should help with the calculations. With picture quality becoming a competing factor, things like higher frame rate and bitrate would increase the size of the movie files even more. Clearly, this would affect movie aficionados if they wish to abandon the movie theaters. And its not just the United States which is facing such issues; usage-based-billing in Canada is charging people for the bandwidth they use as opposed to providing a fixed usage limit.

Unless broadband becomes even cheaper or the caps are removed, going to the movies will still remain an alternative as people will simply run out of their allowance at home. Also, the sheer experience of watching movies on a big screen will keep cinemas alive.

However, the whole idea of a big screen may change in the future as I wrote earlier...