Fueled by a slight desire to watch Terminator: The Sarah Connor Chronicles the other night, I downloaded and played around with Boxee. Overall I think it’s a neat product that works more as a thought experiment than a full-fledged service. If the question were, “is it possible to make a portal for all the various TV sites’ vidoes?”, Boxee proves that they answer is “yes”, but that the technology has moved faster than the networks’ willingness for it to exist.

Basic broadcast TV is very easy to use. You tune to the right station and you watch whatever program is on. You can’t pause, and if you miss a moment you have to ask a friend what happened. You turn on your TV and you watch what’s on. TiVo, while being very easy to use, does add some complexity. You get new features like pause, rewind, etc., but you also get an illusion. TiVo’s user experience is good enough that you usually don’t notice it, but when you pick an episode of The Simpsons off its menu, it’s not really showing you an episode of The Simpsons, it’s showing you what was on channel five between 8:00 PM and 8:30 PM. The distinction is irrelevant most of the time, until a Nascar race or a football game runs late and the illusion of a la cart television is washed away. It doesn’t happen often, but it’s annoying when it does.

AppleTV/iTunes do what TiVo mimics: when you buy a show from iTunes, you’re buying an actual video file of that show, not a recording that was tuned to a broadcast of it. And since the file is on your computer and has few use restrictions, you can stop, pause, fast forward, and rewind to your heart’s content.

Boxee seems to sit in the middle somewhere. Like iTunes, you are picking actual episodes from the menu, so you won’t have the problem of a show being pre-empted by a weather emergency or a late football game, but more like TiVo, you’re stuck with what the originating website gives you. No major network right now lets you just download a copy of the file you want to watch. Instead, they embed the video and show you a stream of it. This means that each time a viewer wants to re-watch a show, they have to watch it from the network’s website again, and the network can monitor how many times that show has been requested and collect money from the advertisers and pay the writers of the show accordingly. But they also sneak in restrictions. Example: I started to watch an episode of Veronica Mars from The WB’s website via Boxee. I got about ten minutes in and then hit a key that stopped the video somehow. I started the show over from the beginning but wasn’t able to fast-forward back to where I’d stopped because The WB doesn’t allow it. Like TiVo, Boxee is providing the illusion of watching video files when you’re really watching streams. Worse, each network has different rules for how their videos work. Some networks allow fast-forwarding and rewinding, others don’t, and Boxee can’t do anything about it. Maybe down the road a standard will emerge, but until then Boxee is going to be stuck with a very inconsistent user experience. If Boxee’s reason to exist is to provide one clean source for internet video, this actually ends up working against it. If I know I’m watching a WB show, I might be careful not to mess with the stream since I can’t fast-forward back, while with a Hulu show I’d know I can come back later if I want to. Boxee wants to pretend that all internet video works the same, but it clearly doesn’t.

I don’t want to knock Boxee’s product (nor TiVo’s), rather just to point out that these are inherent hurdles to its usability. That said, how do I see myself using Boxee? Almost certainly not as a wholesale replacement for broadcast TV. If the networks show over time that they are going to put their stuff online in a timely fashion and do away with their interaction restrictions, that could change, but even then, there are times when one does want to watch something live. Sporting events, weather reports, national emergencies, the morning news, election coverage, Presidential addresses, Emmy/Oscar broadcasts, and TV show finales all need to be watched on time and are often events that people tend to organize parties around. Waiting until a file appears on a website won’t work. There’s no reason that networks couldn’t stream shows right to the web, and if they did Boxee could pick those up, but that’s not being done now on any large scale.

In the fall I bought an antenna and a converter box to play around with the new digital broadcasts, and was generally pleased with the results. On the channels we picked up, the picture was actually clearer than over our Comcast cable for which we pay hundreds of dollars a year. At the time I also did a survey of what TV shows we watch regularly and found that 70% of them were available for free over my little antenna. Comcast’s monthly bill was only giving us three extra shows out of every ten that we watch. Plus, if we had an HDTV, we’d be paying Comcast even more money for that 70% which is already in high definition over the air for free.

What I see happening is that cable companies will lose their monopoly on TV viewing. If I can get 70% of my shows for free over the air, it’s not hard to imagine I’ll come up with a better way to get the other 30% that doesn’t involve paying Comcast $50-100 a month. In a post on Boxee’s blog, Mark Cuban argues that cable companies can provide anything the web can, and while technologically that’s true, it assumes that cable can continue to convince people to keep paying for them. Bandwidth might be a compelling reason, but the likelihood that they come up with a device that’s as easy to use as TiVo/Boxee/whatever isn’t something I’d bet on.

I would not be surprised if the big loser in the internet switch ends up being cable networks. With Battlestar Galactica over, I don’t watch anything that the Sci-Fi channel offers, and even then they had that online so if I hadn’t had cable, I could have watched it for free on their site or bought it from iTunes for less than one month’s cable bill. In the short term they make money from my online viewing, but if lots of people start dropping cable they’ll lose out on that bundling revenue they get from Comcast, Time Warnet, etc. And that’s just original programming. Hours of programming on many cable stations are filled with old movies, but now Netflix offers instant viewing and Hulu offers reruns of old TV shows. I don’t see The Daily Show going online-only, but I also can’t see much use for Comedy Central if I can watch its biggest shows for free from its own website. No network wants to admit that its carefully marketed image isn’t worth anything if viewers only care about one show on its lineup, which is why they try to add restrictions to online viewing and why they’ve been trying to push Apple toward offering TV shows as bundles instead of as one-off purchases. TV networks aren’t in a very different situation than record labels were a few years ago when suddenly consumers could just buy the one good single off an album, but they’ve had a few years and a few million lobbying dollars to think about possible ways to stop viewers from being able to do things that conflict with their business models. Thus the flaw in Boxee’s model and the hesitation of the TV networks to do more than dip their toes in the pool.

All of this isn’t to say that people just want things for free. Five years ago, post-Napster shutdown, getting music illegally was free but inconvenient. You’d often get disconnected before downloading a complete file, and often the file would be corrupt, low quality, or the wrong song. iTunes’s success with music showed that what people want is for things to be easy, and they’ll pay a fee for easy unless it’s costly enough to make free worth the effort. Right now, for most consumers, the cost of cable is high but the trouble you have to go through (and what I just wrote thousands of words about) to get all the same stuff for free likely isn’t worth it. But I think that’s changing. I’m glad Boxee’s playing with the idea, but I worry that they’re the electric car, a clever concept released before the rest of the industry is ready for it.