My dear colleague Rick Munarriz has been busy lately uncovering evidence of a trend that will soon change the way we watch television. But I think you missed the actual trend, Rick.
The sweet and lowdown
In short, Netflix
Speaking of TiVo, that DVR functionality and all the yummy TiVo-brand extras are coming soon to a Best Buy
That's another way to remove a set-top device from your entertainment center. And when it comes to consumer sales, convenience is king. The more functionality that can be baked into the TV itself, the more likely we are to actually use those features. Yes, even if we have to pay a subscription fee to TiVo, Netflix, or others in order to activate the rich-media goodness.
So, that's obviously great news for companies that sell third-party set-top boxes today, like TiVo. But it takes just a tiny leap to arrive at another investable conclusion here.
If you can build a TiVo into the TV set today, then what's stopping Comcast
The abundance of Netflix and TiVo technology deals -- we've only looked at the latest couple of announcements here -- proves to me that the industry is ripe to make that switch. The cable guys and their shareholders should be all excited about the idea, too: Every time Comcast has to send a technician out to install another set-top box, there are both hardware and service costs to consider. Sure, the customer will eventually pay it all back, with interest, but it takes over a year before a newly installed box becomes a profit center for the cable provider.
I love the smell of cash in the morning!
Multiply the combined costs per installation by 24 million customers, most of whom also watch TV in more than one room, and the potential cost savings inherent in cheaper and less intrusive installations rack up pretty quickly. If I were Time Warner or one of its rivals, I'd be sweating bullets to get tru2way technology into every living room in my market area ASAP.
The set-top box is dying, and we'll all be happier when it's gone. Yes, Rick -- even you.
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Fool contributor Anders Bylund owns shares in Netflix, but he holds no other position in any of the companies discussed here. You can check out Anders' holdings or a concise bio if you like, and The Motley Fool is investors writing for investors.