Even if Intel’s OnCue plan had succeeded it would have failed

It was big news this morning but no big surprise that Intel has pushed back the launch of its OnCue over-the-top pay-TV service from 2013 to sometime in 2014, and may mothball the idea entirely. Heading into October Intel had signed no major (or even minor) content deals, making a 2013 launch pretty implausible, and the chipmaker has reportedly been casting about for partners or a financial backer to help keep the plan afloat.

A frontal assault on the entrenched incumbent pay-TV service providers was always the longest of long shots. It will take a staggering amount of money for anyone to persuade the major media companies to risk disrupting the good thing they currently have going with traditional pay-TV providers, and the stakes are only getting higher as the networks squeeze ever-higher carriage and retransmission fees out of traditional distributors.

Even if Intel can get past those hurdles, however, I suspect OnCue will struggle to gain traction with consumers. Intel’s mistake wasn’t simply the scope of its ambitions but that OnCue is aimed at solving the wrong marketplace problem. The real challenge facing both TV viewers and the industry today isn’t how to get more content to the TV, it’s how to get TV content onto other types of devices, especially mobile devices. That’s why the biggest battles being fought today within the industry are over who gets to deliver content to non-TV devices and on what terms:

  • Apart from price, the biggest sticking point in this summer’s retransmission fight between CBS and Time Warner Cable was out-of-home digital rights.
  • The ongoing litigation between the networks and Aereo concerns delivery of broadcast programming to mobile devices. 
  • Fox is trying to put the Sling genie back in the bottle by suing Dish over the Hopper With Sling DVR.

All are about getting TV content off the TV. Insofar as getting content to the TV is an issue for the industry these days it’s about using mobile platforms to get it there, not how to pipe it to the set-top. That problem is more or less solved, and solving it again may not have much appeal to consumers.