Anytime, anywhere online video content gaining traction

To the content producers and cable networks, this is a way to ensure they are able to continue producing original programs, which they wouldn't be able to do if the shows were available online for free.

But to public interest groups like Free Press, TV Everywhere threatens online competition because it excludes non-Comcast customers.

"Comcast wants to be the gatekeeper to the video programming world. This service is a threat to innovative online video and an attempt by the industry to impose the cable-TV model onto the Internet," said Marvin Ammori, senior advisor at Free Press.

The Federal Communications Commission is starting to pay special attention to how television programs and other content is distributed online. The agency is looking into laws that dictate how cable networks are required to give access to popular programs--especially sports content--to competing phone and satellite companies. And the FCC also wants to make cable boxes more innovative by allowing consumers to connect to the Internet directly through their TV services.

Verna of eMarketer said consumers who expect TV content to be available on demand, on all devices, may be more willing to shell out for subscriptions and discrete downloads.

"One of the keys to the growth of paid video content is technology integration," he said. "With consumer electronics firms launching a new wave of Internet-enabled TVs and other devices, the next decade will bring about a wholesale shift in the home video experience."

In a conversation with Hillicon Valley yesterday, Comcast's top government relations executive David Cohen said the content owners will ultimately decide where and how content is going to be offered on TV or online. As rights holders, they need to get paid for the content they produce, and they have an interest in making the content broadly available across a lot of platforms as long as they can monetize it and continue to produce it.