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Tech
How to Watch TV
The Wall Street Journal Online
By Peter Grant and Dionne Searcey

Flurry of Deals Gives Viewers New Options
For Tuning In to Shows; Paying by the Program

Watching TV used to be the embodiment of mindlessness.

But now, deciding how and what to view is a surprisingly complex task, as a series of industry-transforming deals presents consumers with a host of new viewing options. Each approach requires a different device, and each charges viewers in a different way.

The upshot: It is easier than ever before to watch any show you want anytime you want, instead of watching scheduled shows. The move toward "time shifting" accelerated this week, when two big TV networks, CBS and NBC, agreed to make such prime-time shows as "Survivor" and "Law & Order: Special Victims Unit" available for viewing anytime. The deal comes less than a month after Apple Computer Inc. and Walt Disney Co. made a deal that allows viewers to download episodes of popular TV shows, including "Desperate Housewives" and "Lost," on a video iPod.

Now, programs can also be viewed on cellphones, computers and practically any other device with a screen. Sprint Nextel Corp. last week announced a deal that will dramatically increase the amount of content available for viewing on cellphones. Already, Sprint and Cingular Wireless offer some live TV, and Verizon Wireless and Vodafone run a video-on-demand service called Vcast.

This changing landscape means viewers can often avoid commercials. But they may have to prepare for a future of paying fees for specific shows, such as the CBS/Comcast Corp. deal that will sell episodes of "Survivor" for 99 cents apiece. Here`s a viewer`s guide to the latest ways to watch TV.

Video on Demand

Cable companies now make movies and other programs available to subscribers who buy a higher "digital" tier of service, which costs roughly $10 to $15 a month extra. To start watching, all viewers have to do is press a few buttons on their remotes, tapping into thousands of hours of content stored in central offices. Viewers usually can reverse, pause or fast-forward the action so they can speed through commercials.

On-demand services have one notable plus: They usually include programs that aren`t available on regularly scheduled TV. Operators offer everything from local high-school football games to clips of available singles in the area. Also, many cable operators give a special on-demand benefit to subscribers to premium channels. They can, for example, watch at any time any episode of Rome that`s aired on HBO so far this season.

But by the same token, the content is limited by the cable company. Cable companies vary widely on how much content they have provided and what they charge. Often, operators charge a fee to view recently released movies, prime-time programming or other popular content.

Comcast, the country`s largest cable company, offers 3,800 movies and programs -- most of them free. Comcast charges about $4 apiece for the most recently released movies and 99 cents each for the CBS prime-time shows that were announced this week. More than 90% of Comcast`s 9.4 million digital subscribers can get on-demand service.

But other cable companies have been slower to offer on demand. Cox Communications Inc., for example, which has put a higher priority on rolling out phone service, offers on-demand service to about 50% of its subscribers. Cox also has less free content and charges $1.95 to $3.95 for movies.

Time Warner`s cable division, meanwhile, is heading off in a different direction. It offers a standard on-demand service that includes hundreds of movies for a fee and 350 hours of free content from Cartoon Network, Court TV and other programmers. But Time Warner Cable also has just introduced a new on-demand service, known as "Start Over," that enables viewers to watch a show from the beginning even if they tune in while it`s in progress. That service only works if the viewer tunes in during the show`s scheduled time. Also, while pausing and rewinding is available, consumers can`t fast-forward, so they have to watch commercials.

DVRs

TiVo`s introduction in the 1990s of DVRs, which can record shows without tapes and can pause and reverse live TV, was a major improvement over videocassette recorders. Today, digital recorders are offered by most major cable and satellite companies as well. The best aspect of DVRs is that once consumers acquire the equipment, they can record any show they want for no additional fee.

Consumers can either buy a DVR from TiVo or another manufacturer such as ReplayTV or lease one from a satellite or cable company such as Time Warner Inc. Most viewers have preferred to lease, which costs roughly $10 to $15 a month over the price of digital cable service. TiVo recently reached for more market share by dropping the prices of its least expensive unit to $49.99. TiVo subscribers also have to pay a monthly fee, but many consumers prefer TiVo service because it is easier to use and can do things that other DVRs can`t do, like recommend shows on the basis of viewing habits.

One drawback of DVRs: The storage capacity is limited, so at some point consumers have to delete programs they`ve recorded to make room for others.


Cellphones

People who want to watch TV on the small screen are getting a lot more choices. The new Sprint deal will enable viewers to watch shows that they`ve stored on their home DVR, along with more live TV and on-demand offerings. Sprint and Cingular Wireless both offer MobiTV, which has 25 live TV programs, including MSNBC, Fox Sports and two C-SPAN channels. Sprint also has a video-on-demand service called Sprint TV that offers frequently updated short video clips of news, entertainment and weather forecasts and live TV from outlets such as Fox news.

Meanwhile, Vcast features shorts from NBC, CNN and Dow Jones & Co.`s MarketWatch, along with music videos and clips of "The Daily Show With Jon Stewart" and other TV comedy and entertainment programs.

To watch cellphone TV, consumers have to buy video-ready phones, which cost as little as $99. The TV service also usually costs an extra fee. While the mobility may be enticing, allowing you to watch TV anywhere you get cellphone service, the quality of the picture is not as good as on traditional TV sets. Also, content is limited to what the cellphone companies make available.

IPods, etc.

IPod viewing has pros and cons similar to those of cellphones: It`s portable, but the content is limited.

Under the Apple/Disney deal, viewers can synch shows to their iPods and tune in on the go. The episodes cost $1.99 each. New episodes are available the day after they are broadcast, and older ones from the first season are available immediately. In addition to "Desperate Housewives" and "Lost," the other shows are "Night Stalker," "That`s So Raven," and "The Suite Life of Zack & Cody." The cost of the video iPod starts at $299.

NBC Universal has said it is close to working out a deal with Apple to provide shows on the video iPod. Apple also has a deal with Pixar Animation Studios to distribute short animated features including "Tin Toy," "Geri`s Game" and "For the Birds" for $1.99 each. And the company is offering 2,000 music videos licensed from major recording companies.

New Content Providers

Other technology companies are looking for ways to put on TV content stored on the Internet. Computers using Microsoft Corp.`s Media Center operating system can connect directly with TVs, enabling users to watch Internet content. Users can either view things they`ve downloaded from the Internet or, using a Media Center application called Online Spotlight, they can watch content from services like MovieLink and CinemaNow. Computers with Media Center software can now be purchased for under $1,000. Internet content services like CinemaNow charge fees starting in the $1.99 range.

A venture of Yahoo and TiVo announced earlier this week also plans to make Internet content available on TV. At first, TiVo subscribers who plug high-speed Internet connections into their boxes will be able to use the Yahoo site to see photos and check traffic and weather. Eventually, the venture may make it possible for TiVo subscribers to search for video on the Internet.

Besides the rush to the small screen, traditional phone companies are trying their hand at getting into the television business. Verizon Communications Inc. this fall launched its fiber-based television service in Keller, Texas, and has plans to expand the offer elsewhere. SBC Communications Inc. is preparing its own Internet-based television service to be deployed in coming months. The companies are spending billions to enter the TV market in hopes of competing with cable companies that have entered their turf by offering Internet-based phone services.

Write to Peter Grant at peter.grant@wsj.com and Dionne Searcey at dionne.searcey@wsj.com.
 
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