If all goes according to plan, the best show on television may soon be available on the Internet as well. According to Ron Grover from BusinessWeek, HBO is planning to launch its own subscription-based Internet service. Stacked against HBO in this initiative are the multiple, unsuccessful attempts its competitor Starz has made in online distribution, as well the extremely lucrative symbiotic relationship the company has cultivated with the cable and satellite operators, which could be put in jeopardy by such a move. Can HBO overcome these obstacles?

If any company can make this happen, it's HBO. On the first count, Starz's lackluster online performance, there is one differentiating factor between HBO and Starz, content. HBO pours millions of dollars into producing original content: Motion pictures, television shows and documentaries. Starz's inventory is populated purely by movies, and usually not the best selection of movies at that. The secret to Internet success is no different from the secret to broadcast success, better content draws bigger crowds.

The cable companies are definitely going to be up in arms at this news, although I really don't think there's much they can do about it. The satellite companies are probably happy about it. Digital cable companies offer HBO On Demand, which allows users to view episodes of their favorite HBO shows at any time, like a hosted PVR. Satellite cannot offer this option, which is a main drawback of their service. If previously aired episodes are available online, the value of on demand programming is devalued somewhat. While the cable companies may protest, they really don't have much of a recourse, if they drop HBO from their offerings they're devaluing their own product. If HBO wanted to play hardball with them, they probably could. But I think a more amicable resolution will be made which will have HBO bundling its standard subscription with Internet access. A portion of the premium paid will probably be split with the cable and satellite companies.

I still think it'll be some time before IPTV or VOD services over the Internet will cut into the cable and satellite business significantly. But in the niche that offerings are currently serving, HBO should leap into the spot of market leader. It has exclusive content, and quality content in my opinion. Every year when HBO shows clean up at the Emmy's millions of people are introduced to an alternative type of programming, this move would give them another outlet to discover the shows. — Brian Ward

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