As has been said, fixed-price unlimited Internet access for consumers is no longer a policy supported by U.S. regulators. The term "Unlimited Service" is only seen in advertising with tons of disclaimers and fine print which basically says the service is capped. After the FCC gave broadband service providers the OK to abandon true unlimited service cable companies experimented with several fixed-price tiers and landed at about 300 Gigabytes (GB) per month as the accepted monthly allocation for consumers.
This cap not been much of a problem for Netflix and other movie streamers because streaming a single movie might reach about 2GB, depending on the display resolution chosen. Streaming one movie per week would use less than 10GB per month and the consumer would still have 290GB remaining for regular Internet use. Even two movies a week wouldn't have much impact.
But how is this different with live TV streaming? Suppose a single TV household has a TV on for six hours a day. Even with the high efficiency codec (h.265) Intel will most likely to use in its box, that single TV could use 121GB per month or nearly half the entire monthly cap. If the household has a second TV that could be 242GB per month leaving very little data left for Internet use. As high resolution 4K resolution TV's are introduced to the marketplace this year the bandwidth requirements for streaming to each TV could easily double or triple.
Owners of Intel's Web TV could easily find themselves exceeding their monthly cap and facing higher prices for Internet bandwidth to do exactly the same things they were already doing with their PC's and TV's.
Anyone that believes in the perpetual free lunch might like this business model, but those that exist in the real world have a right to be skeptical.
Do you really think that you are the only one who has made these calculations? Do you really think that Intel entered a whole new business hiring hundreds of people and investing millions of dollars without thinking about this basic aspect?
Just have a suggestion: you should think before you post....
What probably happened is this. Intel probably wanted to partner with the cable companies and took the idea to them and actually the early articles on the topic reported that Intel's Web TV was going to be launched with cable companies. But the cable companies had no desire unbundle or to cannibalize their revenue and sent Intel packing.
So now Intel is attempting to bypass the cable companies altogether with an Over-The-Top service like Netflix, Vudu and others. Problem is though there is a huge difference in the amount of data needed for occasional movie streaming and 24x7 live TV to multiple TV's. And simply assuming "someone else" has done these calculations doesn't change the reality of the bandwidth problem. Moreover it doesn't change the fact that the cable companies can launch their own identical live TV streaming service and not charge the consumer any overage fees for their own service while charging Intel's customers extra fees for the very same thing.
You may say, this would be really stupid and Intel wouldn't do this. But they did nearly the very same thing five years ago when they wanted to enter the wireless business. They created WiMAX technology to deliver wireless broadband but instead of working with Verizon, AT&T and the world's leading carriers, they invested in a wireless startup called Clearwire to push their WiMAX service. In response the leading carriers simply developed their own version of WiMAX called LTE and promptly crushed Intel's WiMAX along with the Clearwire upstart. Altogether Intel probably spent $6-8 billion on that fiasco.
The second flaw in the Web TV business model is the camera. Intel needs the extra revenue from the spying and selling-off customer's data to encourage content creators to unbundle. Intel miscalculated the widespread concern and controversy surrounding their desire to spy on its customers watching TV, and without that extra revenue there's no incentive for content owners to unbundle.
Why would that be a secret? No one expects a highly compressed 3Mbps video for streaming to rival 50Mbps Blu Ray media. It's not even relevant to Intel's effort because no one is proposing Blu Ray for live TV.
Intel will use the HEVC video codec instead of H.264, which Intel's Erick Huggers says can provide much better video. Speaking to the (very real) concern of data caps on broadband, he says that Intel thinks they'll stay within them for most users — but long term those caps will either go up or go away. As for cost, Huggers said that the new service is "not about a value play," but instead offering a "vastly superior experience," which along with his comments about channel bundling suggests that Intel is not likely to save consumers much money over a more traditional cable subscription.
feldman.stan....I hope that going the Intel route would save users a considerable sum of money. Otherwise, why bother to make the switch at all?!? That is the whole point of choosing which channel bundle packages you want ... to save money over paying cable for 200 channels you don't want. Saving on sports channels especially should really lower the cost for the 60% of people who don't give a lick about sports.
Huggers "thinks they'll stay within them [the caps] for most users"? That's a big restriction. Why does Huggers believe those caps will go up or disappear entirely? The FCC is happy with the caps cable companies have today and no one is championing changing them. Neither Netflix nor Vudu has any issues with the status quo. Further, the FCC moved to support caps as part of the broadband reform it made during Obama's first term. It is not going to reverse this policy, especially with Obama's re-election.
Caps are only a problem for Intel's live TV business model and it will become more of a problem when current HDTV's are replaced with Ultra HDTV's.
Of course caps don't even apply to streaming services the cable companies deliver themselves so don't expect them to be asking to go back to fixed-price unlimited.
I guess I am not seeing the bandwith issue as being a problem. Most ISP's do not have bandwith caps and when they do, it is more throttling bandwith kind than actual measured rate pricing. Lets face it, as cloud takes off bandwith usage is going up. Way up but the cost of providing bandwith is going down. Also, with compression, the streaming just isn't going to be a big problem. Users are not going to really leave streaming on 24/7 but just watching a few particular broadcasts a day. People stream a lot of content to their computers already. This just moves it to the TV.
My provider Comcast had a cap of around 350 GB a month but they apparently dropped it because of complaints. Even at that you could stream content 8 hours a day for a month before you would run into cap issues. Wireless providers do have caps for the obvious reason that wireless is a bit more expensive to implement then wired. But the question was not about wireless providers.
The argument about additional traffic for the cloud makes my point. Cable companies already provide plenty of data for consumer's Internet and cloud use - assuming no one is streaming to several TV's to bypass the cable operator's HDTV service. When the home owner gets the bill for exceeding their monthly data allocation whose fault will it be? It won't be the cable company. It will be the streaming service used to bypass the same HD channels one can get via the cable company. And exceeding the allocation isn't an argument to do away with caps or increase them, it's the argument for the consumer to drop the Intel service and buy the video programming directly from the cable company.
Intel's Media Group may not even have time to wait for cable companies to fight the caps. The typical timetable for an Intel experiment to produce serious traction is about 24 months. After the project is quietly shutdown.