"TV Everywhere" Stinks, but These Companies Can Fix It

Your cable provider probably offers a TV Everywhere app and website with your cable subscription. And you probably don't use it.

A survey by NPD this spring found that just 21% of pay-TV subscribers used the TV Everywhere services offered to them. TV Everywhere overpromises and under delivers with just two words. You're lucky if you can stream more than 15 channels outside of your home and, often, those channels aren't worth watching. So it's no surprise that just one-fifth of subscribers "take advantage" of the service.

But "TV Everywhere" that fulfills its promise could become a reality in the near future, thanks to several companies working with content owners to provide Internet-delivered television. Sony (NYSE: SNE  ) plans to launch its service by the end of the year, and Verizon (NYSE: VZ  ) is aiming for mid-2015. Dish Network (NASDAQ: DISH  ) already has at least one content deal in the works, and rival DirecTV (NASDAQ: DTV  ) isn't far behind. Internet-delivered television could finally deliver on the promise of TV Everywhere.

A reason to switch
As Internet-delivered television starts rolling out, consumers will likely question why they should switch. After all, the same company that provides Internet access to their homes offers television service for a marginally tiny price when bundled. It will be next to impossible for these Internet-television services to beat them on price. Additionally, Internet TV isn't getting rid of the cable bundle. At least, not anytime soon.

Now, these services might provide a nice user interface. Tim Cook has remarked on several occasions how bad the television user experience has become -- leading to multiple Apple TV rumors. But most people are willing to put up with a suboptimal user interface on their big screens.

However, the TV Everywhere angle could be a huge selling point for Internet-delivered TV.

A survey from Nielsen found that for every hour of television Americans watched on a television set, they spent 20 minutes watching television on a smartphone or tablet. If the content available on mobile devices improves, those numbers will move closer together. There's clearly demand for content on devices other than television sets.

Why content companies are hesitant
Don't blame your cable company for its terrible TV Everywhere service. Content companies are hesitant to offer a lot of content because password sharing has become commonplace. It seems like everyone I know has an HBO Go password, but none of them pays for HBO.

The services that Dish, Sony, DirecTV, and Verizon are working on are personal streaming services. That means that they would be set up so they can only stream one channel to one device at a time.

The reason that hasn't been implemented with traditional pay-TV packages is that cable is supposed to be for a whole household. So, if you're traveling, your wife is commuting home, and your kids are over at a friend's house, and 24 Live Another Day is about to come on, you should all be able watch Jack Bauer at the same time.

Personal streaming should take care of the password sharing problem. Nobody's going to share a password because when showtime rolls around, and Jack Bauer's about to start busting heads, you don't want to be locked out of your TV service.

It's worth noting that these personal streaming models are aimed at individuals, not families, so they're limited to a single stream. However, Dish Network chairman Charlie Ergen might have a different definition of single-stream than the content companies, which makes the service more appealing to families if the company can deliver: "If everybody is watching the same channel," he told analysts, "We call that single stream."

What to expect from Internet TV
Dish seems to have made the most headway with content companies, negotiating deals with Disney and, more recently, A+E Networks and Scripps Networks. Sony has a deal in place with Viacom, and is reportedly speaking with Disney and Fox. Verizon and DirecTV have yet to announce any agreements with content companies despite talking about their plans.

Sony and Verizon seem to have an advantage over the satellite TV providers. Sony doesn't have to worry about cannibalizing other television services, and has millions of Internet-enabled devices in people's households already. Verizon has the infrastructure in place -- a content-delivery network, a wireless network -- to support Internet TV and keep prices low.

Dish Network and DirecTV don't have any huge advantages. Unless they can compete on cost or content, which is a double-edged sword considering it could cannibalize their satellite services, they won't be able to compete with Sony or Verizon's infrastructure.

Your cable company is scared, but you can get rich
You know cable's going away. But do you know how to profit? There's $2.2 trillion out there to be had. Currently, cable grabs a big piece of it. That won't last. And when cable falters, three companies are poised to benefit. Click here for their names. Hint: They're not Netflix, Google, and Apple.