The new Internet television service announced with much fanfare by Comcast Corp. earlier this week doesn’t seem to make sense. An online TV service for people who don’t own TVs? What’s the point?
Then again, after seeing a demonstration of the new service, called Stream, I think that Comcast might be onto something. I won’t pay $15 a month for Stream when it’s launched in Boston later this summer. But Stream isn’t for me.
It’s designed for a significant sliver of the population, people who watch video online only. As of last year, that was 3 percent of all US households and growing fast, according to the market watchers at Nielsen. Lots of them are young adults who’ve never signed up for cable or even purchased a TV. Stream is Comcast’s gateway drug, an inexpensive sample that could spawn a lifelong habit.
Comcast Stream will let subscribers use computers and mobile devices to watch live broadcasts from the major networks; check out the premium cable channel HBO; view an array of rather dusty movies and reruns on Comcast’s Streampix service; and record broadcasts for later viewing.
Stream can transmit shows to a maximum two mobile devices at once, and the video recording feature can capture two shows simultaneously.
During a demonstration on an Apple iPad, Stream served up excellent high-definition video. I found pretty much all the local broadcast channels, from the network giants to those obscure little channels that show Andy Griffith reruns. Screen menus feature the same format as Comcast’s traditional cable service. Even the channel numbers are the same, with Boston’s Channel 4 listed as channel 804, for instance.
But while Stream will let you watch recorded shows and movies using any broadband connection, it lets you watch live TV only when you’re connected to the Internet in your home. It’s mobile TV for people who don’t move.
Don’t blame Comcast; they’re bound by the TV networks, which are in no hurry about bringing their live shows to the Internet. For instance, ABC and NBC currently stream their shows live in several cities, including New York, Los Angeles, and Chicago, but not Boston. CBS’s new All Access service delivers that network’s live shows, but charges $6 a month to view them.
A Comcast executive told me they’re in talks with the networks and hope that, by year’s end, Stream subscribers will be able to view network TV shows wherever they like.
Stream isn’t compatible with an actual TV set. You could cobble together a workaround, like wirelessly connecting a laptop to your TV via Chromecast, the $35 media device from Google. But why bother? An existing Comcast package, called Internet Plus, is designed for TV owners and offers the same viewing lineup as Stream and a 25-megabits-per-second broadband connection, for $74.95 a month. That makes Internet Plus cheaper than Stream, which costs $81.95 a month — $15 for a subscription and $66.95 for a 25-megabit Internet connection. (For both services, tack on another $10 a month if you rent a modem from Comcast instead of buying your own.)
Of course, the ideal Stream buyer will already have broadband, and in any case, a Comcast spokeswoman told me that the new service isn’t about saving money.
After all, Comcast has a package that delivers a stripped-down 45 cable channels and 75-megabit broadband for the same price as Stream — $81.95 a month.
Comcast isn’t targeting bargain hunters, but cable-wary millennials who’ve never embraced traditional TV. A couple of years ago, cable companies and broadcasters regarded these youngsters’ viewing habits as odd but harmless. But recently the numbers have turned outright scary.
According to research from Nielsen and the Wall Street firm MoffettNathanson, cable TV viewership fell 6 percent in May from the same period in 2014, and broadcast TV viewership dropped 14 percent. It’s not that we’re watching less video. We’re just doing a lot more of it online, at sites like Hulu, Netflix, and Amazon Prime. Nielsen says that 40 percent of all US households now subscribe to at least one streaming service.
Meanwhile, the audience for traditional TV isn’t just waning — it’s aging. According to the research firm Media Dynamics Inc., the median age of the people watching ABC, NBC, and CBS in 1990 was 41 years. Today, it’s 57, which is why Tom Selleck is still on the air and the evening news is full of ads for denture cream.
The TV industry isn’t in crisis yet, but the omens aren’t good. And there’s only one cure — It must win over young viewers who’ve been so busy with YouTube that they’ve never heard of “Dancing With The Stars.”
Can Stream do the trick?
I have no idea; Comcast probably doesn’t either. But it’s not as if they have much choice. In today’s video market, it’s sink or swim.
Hiawatha Bray can be reached at firstname.lastname@example.org. Follow him on Twitter @GlobeTechLab.