Report: Game Console Vendors a Threat to Pay TV

A new report from research consultancy TDG predicts that console-affiliated media portals such as Microsoft's Xbox LIVE and Sony's PlayStation Network will soon become formidable competitors to incumbent pay TV services. Leveraging broadband-enabled game consoles as over-the-top video platforms, thus bypassing cable and satellite TV operators, these companies will offer a compelling alternative to traditional TV programming by providing a more immersive, interactive video experience.

The report, "Console Vendors and OTT Video Delivery - Let the Games Begin," points out several facts:

• Microsoft's Xbox LIVE had amassed some 15,000 movies (1,000 of which are HD) and some 13,000 TV shows for download-to-own, and its Netflix partnership adds 12,000 movies and TV programs to the mix, all for free streaming to Netflix subscribers.

• Sony's PlayStation Network has collected close to 1,000 movies and hundreds of TV programs for download-to-own. As well, it has announced plans to expand dramatically its video library in the next few months in order to compete with Xbox LIVE.

• Nintendo is working with Fujisoft to introduce "Everybody's Theater Channel" to Japanese Wii users in December.