At Cable TV Show, Netflix Is Four-Letter Word

The Cable TV Show, held in Chicago this week, brought together top industry executives for panel discussions, workshops, and new product expositions. But bubbling beneath the surface, reportedly, was an uninvented guest.

Covering the show for AdWeek, D.M. Levine found that Netflix was a constant subject of conversation, and a source of irritation to industry executives. Whether at social gatherings or from the podium, Netflix's name came up time and again, and not in a good way.

Netflix is the wildly popular movie streaming service. Subscribers pay just $8 a month and can view a vast library of movies and television shows on demand. It is especially popular among young people, who have weened themselves off cable because of the relatively high cost.

Treading carefully

Netflix itself is careful not to overtly antagonize the cable industry. In an April interview with ConsumerAffairs.com, Steve Swasey, Netflix VP for Corporate Communications, discounted the notion that viewers are “cutting the cord,” ditching their cable service in favor of a Netflix subscription.

“We don’t see Netflix as a competitor to cable, but rather as a supplement to cable,” he said. “At $7.99 a month, you don’t really have to cut anything, except maybe one latte a month, to have Netflix.”

Even so, Levine reports one cable executive made a point of referring to Netflix's requirement for a “fat pipe,” or broadband connection, noting that Netflix will eventually have to charge much higher prices.

Net neutrality

That may be a reason for consumers who like Netflix the way it is to get behind the issue of Net neutrality. At least, for now, Net neutrality allows Netflix and other content providers to stream their bandwidth-rich content over the Internet without paying a fee to network owners, like Verizon and Comcast.

The network owners don't like Net neutrality for two reasons. First, they would like to get more revenue from the biggest users of its network. Second, network owners that are in the content business can't be happy about the idea of consumers having another, much cheaper alternative.