This could be a big breakthrough for tech companies that want to create an Internet-based alternative to traditional cable and satellite services. The Wall Street Journal reports that Sony has a preliminary agreement to carry Viacom‘s channels on a service it hopes to launch by year end. The programming would initially go to those with Sony devices including its PlayStation gaming console and Bravia HDTVs, with tablets and smartphones to follow according to “a person familiar with the matter.” If Sony and Viacom complete their deal it would be the first time a major programmer has agreed to provide its most popular pay TV channels to an online service. Intel and Google are among the other companies hoping to use the Internet to challenge cable and satellite video offerings. Sony’s talking with other programmers including Disney, Time Warner, and CBS.
Last week Time Warner CEO Jeff Bewkes told analysts that while he’s ”not philosophically opposed” to Internet competition to traditional pay TV, “we don’t see it being viable through any of the usual suspects yet.” Programmers have been reluctant to upset their lucrative relationships with cable and satellite companies. Also, a new entrant likely would have to pay much higher rates than traditional players do for programming — which would make it hard to offer consumers a competitive price. But the Journal reports that people who have seen Sony’s proposed system say it has attractive interactive features, including one that would enable a programmer to recommend shows to viewers based on what they’ve already watched.