Just returning from FISPA where there are some members who view TV as a necessity, I came across some interesting tidbits.
Frontier bought about 100K FiOS customers when it acquired VZ's rural assetsin 2011. It immediately raised TV rates by over 40%. It says that it cannot buy content at the same rate as VZ or Comcast. You have seen DirecTV (which has about 20M subscribers in the US). VZ has only 4.5 million FiOS TV subscribers. VZ has 5 million FiOS Internet subs.
TechCrunch wrote about the TV distribution/content battle here: "With their costs rising every year, some cable and satellite providers are beginning to fight back, realizing that perpetually passing on rate increases to their customers is an unsustainable business practice. Equally unsustainable is the plan to hold pricing steady while having margins are eaten away due to the increased cost of programming. Stuck between a rock and a hard place, those distributors are exploring the possibility of creating smaller, less-expensive bundles of content."
In that same article TC explains why a la carte channel buying will not happen.
Meanwhile, Frontier has been selling both DISH and DirecTV to subscribers and is in talks to resell ATT U-Verse TV! It seems dumb to dilute your own TV base, since you need scale to negotiate, but then I don't think like an ILEC>
I just got a Roku and you can't really stream Comedy Central and other online sites to your TV easily. While TV cord-cutting is increasing, it won't be easy for families to watch their favorite shows, unless the idea of the TV changes - the smartphone, the tablet or the computer monitor become the TV.
Manage that for your customers for a fee is probably more profitable than IPTV.