Sony Doesn't Have the Deals It Needs for Web TV — But That's Not Its Real Problem
But That's Not Its Real Problem — Last year, Intel said it was going to deliver pay TV over the Web by the end of 2013. That didn't work out. — Now Sony says it will deliver pay TV over the Web sometime in 2014. Can it deliver? — Maybe!
Context & Ripple Effects
Sony entered CES week by announcing an internet TV service it plans to start testing later in 2014, positioning itself as the company that might succeed where others stumbled. The immediate backdrop is unflattering: as CNET's post-mortem argued, Intel failed to deliver its promised Web pay-TV service by the end of 2013, and Google spent years after its 2010 television push hunting for a foothold that never fully materialized.
The Re/code analysis lands on a specific gap — confirmed reporting that Sony does not yet have the content deals it needs to launch — while arguing the deeper problem is strategic. At CES, CEO Kaz Hirai himself framed the service as something that won't compete head-on with cable, which raises the question of who exactly the product is for.
First-order effects
- Sony cannot launch its Web pay-TV service on any schedule it has hinted at until it signs programmers, leaving the 2014 testing plan dependent on deals that do not exist yet.
Second-order effects
- Programmers now have a live template for pricing these negotiations: Intel's inability to close equivalent deals shows rights-holders they can hold out, and every entrant that fails raises the bar for the next one, including Apple and Google.
Third-order effects
- If even a hardware giant with Sony's content relationships cannot assemble Web pay TV, the industry structure stays locked around cable bundles, pushing would-be disruptors toward thinner offerings — single-network apps and streaming add-ons — rather than full bundle replacement.
The trend: Web-delivered pay TV keeps attracting new entrants while content-rights negotiations remain the choke point that has stalled Intel, Google, and now possibly Sony.