Is the ABC App Gunning for DVR and Video Streaming Services?

Is ABC taking aim at video streaming services and DVR? It seems that way, now that some light has been shed on one of ABC’s latest projects. The media company is apparently working on an app that would allow cable customers to authenticate their subscriptions within the app and stream live TV to a smartphone or tablet. Information on the ABC app was first reported to The New York Times by sources close to ABC.

While time-shifting television has been around since the advent of the VCR, and has since been replaced by DVR and supplemented by video streaming services like Hulu, Netflix and Amazon Prime, the ability to place-shift live TV has lagged behind considerably. The Slingbox is one device that has offered this feature for a couple of years, and the latest edition of Dish Network’s Hopper DVR — which has Slingbox technology built in — recently “won” CNET’s Best of Show at CES 2013. CBS’s knee-jerk reaction to that award speaks on behalf of all media companies — they aren’t big fans of DVR or the place-shifting of TV that doesn’t happen on their terms.

Outside of the Sling realm, there hasn’t been a lot of movement on the place-shifting front — at least, not with major media companies. It’s surprising, as one might believe that, in a world where television is a means to deliver advertising, such media companies would want to get in front of as many eyes as possible. Why not put a live feed online for everyone to watch? The problem is the relationships that these media companies have with cable TV providers. Providers pay to carry channels, and offering the same live content for free on the Web would do a lot of harm to those relationships.

ABC’s decision to require a cable subscription means that everyone stays happy. Cable companies keep getting paid by subscribers, and media companies keep getting paid by cable companies. And consumers, who may already be paying to watch that live content at home, will be able to watch “Revenge” or “Modern Family” on a phone or tablet at the same time these shows are airing on cable. It’s an added incentive for consumers to stick with cable instead of cutting the cord, and it might mean that more viewers watch a live broadcast than a recorded version later. This means viewers will be less likely to skip ads.

So where does this leave a service like Hulu? This streaming video service, which is owned by ABC and several other large media companies, could continue to function as is and provide an additional source of revenue through Plus subscriptions and advertisements. Or it could become the new home for live TV on the Web, should other media companies follow ABC’s lead. Rumor has it that ABC might buy Hulu outright from its other partners, leaving the company free to take it in any direction, and this could mean that Hulu becomes the place to watch ABC live on the Web.

Make no mistake — we’re about to enter an era that is going to be both good for the consumer and bad. We may gain more freedom in terms of where we watch the live content we’re paying for, and that’s a good thing. But if ABC is indeed taking the cable authentication path for its live streaming app and other media companies follow suit, we’ll be even further away from a la carte TV and further into the pockets of major cable TV providers. And as excited as I am about watching live TV on my tablet, handing more power over to cable companies seems like a scary proposition.