Cuban: The Internet Is Dead

HDNet Chairman, Mavericks Owner Who Made Fortune from Web Speaks at CTAM Summit Closing Session

By Tom Steinert-Threlkeld -- Multichannel News, July 26, 2007

CTAM Photo Gallery

Washington -- The archetype of the Internet-bred billionaire Wednesday declared, “The Internet’s dead. It’s over.”

The speaker was Mark Cuban, who sold Broadcast.com to Internet portal Yahoo in 1999 for $5.7 billion. He is currently the owner of the National Basketball Association’s Dallas Mavericks and HDTV programmer HDNet. He is also considering buying Major League Baseball’s Chicago Cubs, out of his pocket, for about $1 billion.

The venture that made his fortune, Broadcast.com, was the outfit that legally streamed programming from 420 radio stations and networks; 56 TV stations and cable networks; and game broadcasts and other programming for more than 450 college and professional sports teams over the Internet.

And Cuban made his comments to operators of a set of high-bandwidth alternatives to the Internet, known as cable systems.

Speaking on the closing panel of the CTAM Summit here, Cuban declared, “The Internet’s for old people.”

His basic point: The Internet has gone stagnant. The only “new application” on the World Wide Web of recent vintage was, in his view, YouTube -- which, unlike Cuban’s Broadcast.com, ripped off the creative content of intellectual-property owners to build its video-based business.

Sour digits aside, Cuban’s view, as repeated in a group interview after the panel with Multichannel News and CableFax Daily, is that cable and satellite networks are now superior to the Internet as platforms for building complex, interactive services.

This is in direct counterpoint to his contention, when he built Broadcast.com a decade ago, that the Internet would -- in 10 years’ time -- have the bandwidth that would make it a superior home for the development and distribution of video programming.

“I was wrong,” he said.

Networks built by telephone companies, like Verizon Communications, and cable companies, like Comcast, do not easily talk to each other, stymieing development of services (like HD video) that require smooth, seamless transport of lots of digital stuff, he said.

By contrast, so-called clustered collections of cable networks provide an enclosed environment that allows high-bandwidth, complex applications to thrive. Developers will figure this out and develop applications to match. If, for instance, a developer wanted to build suites of office applications, he said, the better environment would be servers on local cable systems. Users would have faster response and better experiences. Such developers could “outgoogle Google,” in effect.

Google, the dominant search engine, is developing and providing a series of office applications for writing and making calculations that operate on the open Internet.

In effect, Cuban said, cable networks are “intranets,” which, by their nature, operate more efficiently than the Internet. Cable-system operators can control the quality of service they supply and the amount of bandwidth that developers can use. Plus, there is no friction in transporting services and data within their networks.

His contention harkens back to @Home, the ill-fated offspring of the cable industry that tried to create a “private” Internet that operated at higher speeds and with greater quality than the “open” Internet, which made “best-efforts” attempts to transfer information, whether text or video or other.

Using standards such as the OpenCable specifications and cooperative efforts to interlink their networks, cable-system operators, he added, could create a high-bandwidth nationwide alternative to the Internet that would attract developers of applications that needed and took advantage of greater capacity and speed of transmission.