The world of video is already crowded with movie downloads to PCs and iPods, fiber-to-the-home TV on the way, video on demand from cable, and new services from companies like Amazon coming along almost weekly.
The founders of Skype want in on the action, and have invested some of their Skype cash (EBAY) in a peer-to-peer, near high definition global TV platform. According to the management at the new company the system will be able to handle tens of millions of users because it will rely on PCs around the world with downloaded content to serve the system. Central servers will not be required.
Digital rights management will also not be necessary, at least not in the classic sense. Since each piece of content will be streamed and the "bits and bytes" will never reside on the PC hard drive. Clever, if it works.
The company hopes to get studios and TV networks to use the service as a new conduit to bring in money. Programming will be underwritten by advertising.
It is easy to bet against the new service, just as it was easy to bet against Skype in it early stages. But, Skype’s 125 million users came from a model that significantly disrupted the traditional telephone industry.
Maybe fiber-to-the-home isn’t such a great idea.
Douglas A. McIntyre can be reached at [email protected]. He does not own securities in companies that he writes about.
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