It should not be so difficult. In an age when nearly all forms of media are digital, where broadband signals course through the industrial world as surely (and as critically) as electricity and freshwater, it should be possible to sit on one’s couch, push a button or two, and call up to your television any form of video-related entertainment you desire. New-release movies. Last week’s Lost. The first season of Cosmos. Setup should not require an electrical engineering degree, and you should not be forced to sift through 10 incompatible search functions to find the shows you desire.

Yet it is not easy to watch what you want when you want to. The reasons are not easily parsed and depend as much on technological circumstance as they do on the well-placed fears of entrenched industry powers. Digital distribution threatens their business models like nothing in the history of media, but as the music industry so dramatically illustrated, fighting the consumer’s desire for limitless content is a loser’s game. “I guarantee that five years from now TV as we know it is gone,” says Doc Searls, a fellow at the Berkman Center for Internet and Society at Harvard University. “It will have been a 60-year-old experiment that will be followed by something else.” The major film studios are beginning to upload onto the Web their most precious material, and a plethora of devices are emerging that promise to help the confused consumer pull the richness of the Internet into his or her television. Behind the digital scenes, battles are now taking place that will shape the future of video for decades to come.

The Third Era
The Internet’s invasion of the living room marks what might be called the third era of television. The first era arrived in the middle of the last century via bunny ears and national broadcast networks such as NBC and ABC that still command most television viewers. In the 1980s cable television ushered in the second era by using a new transmission technology—copper wires bundled into coaxial cables—to transmit hundreds more channels into the home.

Although cable greatly expanded the menu of available content, it came at a price: what was once literally free to pluck from the air now had a serious monthly bill attached. Network TV was financed exclusively by commercials; cable networks such as MTV and the Food Network collect a fee—on average about $0.25 per customer per month—that comes out of your cable bill. (This average excludes ESPN, which demands about $3 per customer per month from the cable companies.)

In the late 1990s engineers working with the @Home startup figured out a way to deliver digital data on top of cable television signals. This meant that cable customers could get broadband Internet without additional infrastructure. Today about 36.5 million households nationwide use cable modems to get online, making it the most popular way to access the Internet in the U.S. Yet ironically, the relative ubiquity of cable broadband is one of the primary forces holding back third-generation television.

Cable companies grew into corporate giants by delivering the second generation of television. They are television distributors that also happen to deliver the Internet, not the other way around. Thus, despite the engineering workarounds that allow them to pipe the Internet via their copper wires, their systems are still optimized for television. On cable systems, the Web comes through the bandwidth reserved for a channel or a set of channels. It receives as much in the way of resources as does, say, ESPN and its four siblings. “There is a standing engineering set of specifications that almost requires the Internet be subordinated to television,” Searls says.

Almost as many U.S. households receive broadband through a telephone company’s digital subscriber line (DSL) service, but the story here is much the same: existing infrastructure—in this case, copper telephone lines—have been repurposed for high-speed Internet signals. The Internet is a secondary concern in this electronic ecosystem as well.

This setup makes it nearly impossible to get a true televisionlike experience over existing infrastructure, which shows in the quality of broadband available: the U.S. ranks just 18th in average broadband download speeds, slower than Romania, Iceland and the Czech Republic. Average download speeds in South Korea, the world’s leader, are nearly three times as fast as in the U.S. According to Phil McKinney, vice president and chief technology officer of HP’s Personal Systems Group, the network in the U.S. is the “fundamentally constrained resource.”

There is hope, however. Although telecom companies such as Verizon and AT&T also deliver cable television through their telephone lines, they are not as closely wedded to the TV-first model as the cable companies are. Their core business is delivering telephone service. As Americans stop subscribing to dedicated landlines—at last count, one in five American households rely purely on mobile phones—these companies have begun to build the next generation of data lines feeding into the home: fiber-optic cables. The bandwidth of these services reaches up to 30 megabits per second for both uploads and downloads—about 10 times that of the typical broadband customer. That leaves plenty of room for full high-definition video streams and quick uploads of YouTube videos. It is the first neighborhood infrastructure designed and constructed explicitly for the Internet.

Strangled by Cable
Before your TV screen pulls in video via the Internet, those videos must first go up online. Copyright holders deeply fear this prospect. Movie studios fret about piracy. Over-the-air broadcasters such as NBC fear ending up like the newspaper industry, with viewership, though not advertising dollars, shifting to the Web. And cable broadcasters know that when Internet offerings grow strong enough for customers to drop their cable subscriptions—marketing surveys show cash-strapped customers will sooner drop cable than broadband Internet—their 25-cents-per-subscriber-per-month fees will evaporate as well. “The copyright holders are trying to orchestrate it so that content will only move if you pay for it,” says Philip Leigh, founder of consulting firm Inside Digital Media.

Thus, content providers are gingerly experimenting with ways to deliver their wares over the Internet. The first major salvo in this experiment is the Web site Hulu.com, which NBC and Fox launched as a joint venture in 2008 (Disney, the parent company of ABC, has since signed on as well). The site is the online home to most of the popular shows that air on those broadcast networks. It streams video in such a way that the end users can neither record the shows for posterity nor skip the advertisements. By any measure, it has been a tremendous success. At this writing, it is the second most popular video site on the Internet (after YouTube); according to the ratings service Niel­sen, the ratings for programs such as Lost on ABC would jump by as much as 25 percent if online views were included.

Free video poses an explicit threat to the cable industry, however, which is built on the premise that customers will pay $50 a month or more for programming variety. As such, you will not find shows from the Discovery Channel or MTV on any exclusively ad-supported site. Rather the cable industry is beginning to experiment with Web sites that require a proof of registration. That is, you can watch these programs on the Web, but only if you also already subscribe to cable TV. Time Warner and Comcast are introducing the “TV Everywhere” system this year, which will at first include content from six networks, including CBS, AMC and TNT. If the companies are able to recruit other channels into the project, then “TV Everywhere will surpass user-generated content and will be the biggest thing in Internet video,” according to Comcast CEO Brian Roberts.

The allure for the cable companies is obvious: there is no risk of Internet video cannibalizing cable subscriptions if Internet video requires a cable subscription. “The carriers are also in the content business,” Searls says, “and so in order to protect the business models of the primary form of content they’re carrying—which is still television—they have an incentive to keep a heavier foot on the brakes than on the accelerator pedal.”

This brake is nowhere more evident than in the download limitations cable companies have begun to place on their Internet customers. Under the guise of protecting against peer-to-peer networking, where users share music and videos on a distributed network, Comcast has instituted a cap of 250 gigabytes per month on the data their customers can download or stream. Time Warner is experimenting with caps as low as five gigabytes a month. The companies claim that few customers are affected by the limits, which may currently be true. But it also kills Internet video in the cradle—a single high-definition movie will often require more than the five gigabytes Time Warner budgets for a month’s worth of Internet access.

Home Connections
As Hulu has shown, there is a rich appetite for television content over the more flexible medium of the Internet. Yet getting video to your computer is one thing. Getting it to your 60-inch high-definition TV—and in a way that is easy to set up and intuitive to use—is another.

The most straightforward option is to simply connect a computer to your TV set. A standard high-definition multimedia interface cable, more commonly known by its acronym HDMI, will carry digital video and audio from a recent-vintage laptop to a flat-panel TV. “Computers have become such an everyday part of our life that when we look at the television monitor it is becoming obvious that there is no difference between it and a laptop screen,” says Leigh of Inside Digital Media. “Contrary to the uninitiated, consumers are not confused by this.”

Connecting one’s laptop to the television still leaves open the question of what to do for a remote control. Leigh’s answer—use a wireless keyboard and mouse—gives the user unconstrained power over content and, crucially, the ability to type in search terms. But we are now so accustomed to one-handed operation of a remote control that it is hard to imagine how bulky keyboards will replace them on the coffee table.

There is also the question of how to find content in a world without channels. Let’s say I want to watch an episode of 30 Rock. Was that on Hulu.com? Or TV Everywhere? Right now, Mc­Kinney says, “you need a secret decoder ring to figure out where the content is.” Stand-alone programs such as the free and open-source Boxee are designed to collect all video on the Internet and display on your television a single “home page” directory of everything. Yet here we see another example where open accessibility sometimes conflicts with cable’s business plans.

Although Hulu was originally featured as a channel on Boxee, this past February the content providers behind Hulu—NBC, Fox and Disney—blocked Boxee from accessing the Hulu Web site. When asked about it on-stage at the Wall Street Journal’s “D: All Things Digital” conference in May, NBC Universal CEO Jeff Zucker said that “right now we are committed to Hulu being an online experience.” One way to interpret this statement is that Hulu is not a threat to the traditional cable business so long as the content on Hulu stays on a 15-inch laptop screen. Widespread use of Boxee (and other devices that make it easy to watch Internet video on the television) would cut into the revenue that studios make from cable television fees.

There are, of course, other devices that allow you to pull content down from the Internet into your television. Apple TV accesses the iTunes store. A startup named Roku makes a small device that pulls streaming video from Netflix, the Amazon.com digital library and Major League Baseball games. Other devices go by names like Vudu and ZillionTV. But they all share one common thread: all the content is prepaid. Free television does not exist on these Internet TV devices. So long as it is more profitable for both the cable companies and the content producers to sell you TV through your cable package, expect the limitations to remain in place.

The solution, of course, would be to detangle the Internet from cable companies. The new ­fiber-optic systems are a step in that direction. Because they are essentially “Internet-only” systems, disentangled from the legacy business models that constrain cable operators, they allow for a potentially transformative Internet experience. Consider South Korea, where the Internet is both fast and ubiquitous. Warner Brothers has begun to scale back its DVD operations there to concentrate exclusively on Internet-delivered movies, which are now available two weeks before the DVD appears in stores. Some independent movie studios in the U.S. have even begun to experiment with Internet delivery before the movie ever gets to a theater. It might take some time to move all our media to this kind of instant-on, Internet-based future. “But it’s coming,” Leigh says, “and you can’t stop it.”

The Internet’s New Rules
When President Barack Obama signed the $787-billion stimulus package earlier this year, he claimed that the government would be “remaking the American landscape with the largest new investment in our nation’s infrastructure since Eisenhower built an Interstate Highway System.” In the 21st century infrastructure includes the Internet. The law provides for $7.2 billion in grants to upgrade and expand broadband access in the U.S., primarily in underserved rural areas that require miles of cables to reach relatively small communities. At the same time, the law requires that the Federal Communications Commission draw up a national plan for broadband by February 2010. What that plan includes—and how the grant money gets allocated—will largely define the capabilities of and restrictions on the Internet for years to come.

The primary question is whether the FCC is going to require some kind of “Net neutrality” protections in the national broadband plan. These protections would require that Internet Service Providers (ISPs) not hinder certain kinds of Internet traffic, that they treat all traffic equally. The ISPs claim that they could better preserve the overall health of the network if they were able to slow, for instance, bandwidth-heavy peer-to-peer file sharing. Yet without Net neutrality protections, ISPs would be able to block any kind of file or applications they chose, giving them the power to decide the fate of all Internet-based services.

In addition, the FCC has to decide on what, exactly, “broadband” means. It currently defines it as an advertised download speed of at least 0.77 megabit per second, a mere fraction of the average speeds of 92 megabits per second advertised in Japan. (Advertised speeds are always higher than actual speeds, because they assume a perfect connection that is not shared with other users.) A lower requirement means that more homes can be wired for less money but without the ability to stream high-quality video.

Note: This article was originally printed with the title, "The Everything TV."