Washington -- If you're an AT&T@Home cable-modem
customer, don't expect cable networks on the Internet to be a click away.
Leo J. Hindery Jr., CEO of AT&T Broadband &
Internet Services, spoke out forcefully last week against video streaming by cable
networks in a manner that leaves cable operators out of the picture.
In a warning to cable networks looking for an Internet
video outlet, Hindery said he would not allow streamed video to undercut his cable
"I am not going to allow it to trash the fundamental
model without being a participant in the debate as to how it evolves," said Hindery,
a panelist at a television forum sponsored by Broadcasting & Cable magazine
(owned by Cahners Business Information, publisher of Multichannel News).
Hindery spoke while seated beside Mark Cuban, cofounder of
Broadcast.com Inc., a Web site that streams audio and video over the Internet.
In earlier comments, Cuban said Hindery's view was
untenable because streaming was an almost boundless opportunity not only for established
players, but also for any number of start-up concepts.
"Your next-door neighbor is going to be your
competitor. You are talking about the ultimate niche broadcasting," said Cuban, who
pocketed $1.4 billion in stock when he sold his company to Yahoo! Inc. for $5.7 billion.
Hindery said ready access to cable networks over the
Internet would undermine cable's business model of paying programmers license fees for
"I am not against streaming, but I am against
streaming that destroys the business that I have spent billions and billions of dollars,
tens of billions building. So I am not going to let that happen. That would be
foolish," Hindery said.
AT&T Broadband and other cable operators that own
stakes in Excite@Home Corp. have the contractual right to cap broadcast-quality
streamed-video transmission on the network at 10 minutes.
The companies said the cap is necessary to prevent heavy
video users from clogging the system and slowing transmission speeds. But an Excite@Home
spokesman said the restriction has never been enforced because so little streamed video
hits that bandwidth-hogging quality level.
The Weather Channel president and CEO Decker Anstrom made
several observations that appeared to place him in Cuban's camp.
"I think we need to be real careful with this
preoccupation with cannibalization," Anstrom said. "From our experience, we
think there is significant opportunity to grow a brand."
Anstrom cited the recent Hurricane Floyd as an example of
his network scoring big with cable and Internet customers. "What we found is that our
network ratings went up, as did our page views on weather.com," he said,
adding that the Web site does include brief video clips.