The argument about who pays whom is being worked out right now with Netflix. I know for a fact that the ISPs are trying to get paid by the content providers for the privilege of moving bits over their networks. This is referred to as a "two-face" business model, where they get paid for both ends of the connection. I have to wonder if they appreciate the irony of that name...
My take on your question is, it depends. As of today, I'd say it depends whether the Internet site that provides that programming is a "middleman," or whether it is owned and run by the content owners themselves. In principle, there is no reason for the TV content owners (e.g ABC, CBS, etc.) to have to depend on a middleman for Internet delivery, EXCEPT for having to rely on the ISPs. It is conceivable to me that the content owners would ask for a bigger piece of revenues, from the middleman Internet sites.
And then there's a new possibility. Potentially, the ISPs could be required to pay the TV content owners for the privilege of carrying their stuff, just like cable and satellite TV providers do nowadays.
So as far as I'm concerned, anyone who tethers himself to a single TV carrier, be that a traditional cable or satellite company, or an ISP for Internet TV, is going to be vulnerable to the same shenanigans. Content owners ultimately hold the cards.
That sounds potentially worse than my awful DVR... so yes, that's probably the direction we're headed. We can predict a quick assessment that a TV needs at least 4x 3GHz processors in order to provide the proper user experience... such as not having a twirling icon appear on the screen when you try to change the channel.
I am just wondering how will the revenue model work out for all these services. Whose gain and whose pain?. In the current cable broadcast scenario many times the end customer gets a message " this Channel is blocked as your service provider has not paid" . This in spite of the fact that the consumer has been paying his monthly charges on time. Similar thing could happen here?
The connected TVs I've seen so far, however, *are* limited in the web sites they allow the user to browse. Seems to contradict this part of their definition: "... able to retrieve content from the internet without the restrictions of a portal."
No problem, though. I've already set up a PC dedicated to my TV/audio system. Using the TV as monitor, stereo for the PC sound, and with remote keyboard and mouse, you've got your connected TV and then some. No need to wait for the CE vendors to figure it out, eh? Watching online TV is just like watching any normal TV shows. And it's also a PC, for e-mail and anything else.
But here's the problem: it seems that the TV networks are putting LESS of their programming on the Internet these days, not more. CBS, for example, has pretty much stopped offering their full length episodes on the Internet altogether, with a few exceptions like soaps. And if you think you can watch foreign TV, don't be so sure. Aside from 24 hour news programming, much of the foreign content is filtered. Maybe with a proxy you can still watch it, but they aren't making it easy.
It pays to have at least the OTA TV option too. The networks seem to trust their content to FOTA DTV more than to Internet delivery.
This isn't about "convergence" of TV & internet, in the old-fashioned sense. It's about what the cable TV guys refer to as over-the-top (OTT) video delivery -- the desire & ability of the consumer to select what he/she wants to watch and when.
Netflix, Hulu, YouTube and others are just more sources of video content, but it is on-demand, a la carte content -- something TV viewers have been wanting for years.
I wouldn't worry too much about Java/Flash/HTML, boot time and RAM and all that. If the web-connected TV has a button for Netflix, and one for Hulu and one for YouTube, and those apps are effective and easily navigable, that is 99% of what the consumer is asking for.
Smart TV technology may actually prove to be a continuum and not a technology step. Already TiVo, digital on demand TV services, Netflix, and Wii all provide different mechanisms to access video content on the web through the TV without necessarily utilizing the broadcast TV connections. It may be that consumers don't even notice the transition - excerpt that YES, waiting for the TV to boot is already a part of the user experience.
This does raise a few questions in my mind. Will we end up with television sets that require two minutes to boot up?
Will we end up with television sets that need to pause for upgrades every couple of days before finishing the boot process?
Will we end up with television sets that won't run certain content unless we upgrade the RAM first?