Reuters informs that Microsoft postponed its Web TV subscription plan on Thursday. The project presupposed an association between the IT giant and several other media companies. The plan which had been in construction for almost a year was supposed to start within the next few months.
According to media companies, the TV service was postponed for the moment due to some budget problems. The licensing costs turned out to be too high for the business model that Microsoft had in mind.
Media executives are not happy about Microsoft’s unexpected decision. According to their declarations, Microsoft built the television platform, demoded it and asked the media company to provide them rate cards. When the service was ready to roll out, the technological company told media firms to stop works because the project was becoming too expensive. Microsoft refused to make any comments when reporters asked them to.
The original versions of Microsoft TV service were provided with many more options including the possibility to change the channels through voice and motion control. In exchange of a monthly fee, Bill Gates’ company would have allowed subscribers to receive a package of programming from someone other than a local cable or satellite TV company. This option is also available with Netflix Inc.; however, Microsoft made the feature more expensive because it offered current shows and live networks on its service.
The project was not abandoned, so people may still be able to watch Microsoft TV on the Internet. The company continues to work with big names in the TV industry, but they will perform several changes on the initial project. While the original plan was supposed to replace cable TV packages, the latter version presupposes the delivery of programs via Xbox gaming system to existing cable subscribers.
Media companies have stated that their relationships with Microsoft have cooled off in the past few weeks. Even so, they remain confident that the IT giant will resume negotiations once they set their budget straight.
Microsoft’s place might be taken by other technological companies like Google Inc. and Amazon.com which are now struggling to weaken the domination of the U.S. cable television ecosystem. Comcast Corp, DirecTV Group and program makers like Walt Disney Co and Time Warner Inc. are the major distributors of cable television in America.