As consumer broadband use multiplies, so do predictions that it is going to revolutionize television and video entertainment.1 Probably it will at some point, but television and cable networks would be risking a repetition of their experience with the narrowband Internet if they invested heavily in programming for interactive TV or video on demand just yet.
Over the next three to five years, some 40 million households will gain access to broadband. Even so, only the simplest forms of enhanced TV and streaming-video programming will be profitable—though not profitable enough, in a million-channel world, to defray the high cost of creating and distributing shows that permit viewers to decide how they would like plotlines to turn out (interactive TV) or when they want to watch (video on demand). Yet the interactive programming that could be capable of extracting the necessary premiums from viewers still awaits important improvements in picture quality, and the broadband infrastructure will certainly have to be extended before broadcasters can realistically hope to attract an audience with a sufficient economic scale.
The good news is that broadcasters2 are far more secure from new attackers than they appeared to be at the dawn of the...