Google has forged an agreement to bring premium TV channels HBO and Cinemax to its Google Fiber TV customers, the company announced today.

The availability of HBO on Google Fiber TV is a big win for those that may have been skeptical of the service because it lacked the robust lineup of channels available from other cable and satellite TV providers. When it first rolled out to Kansas City, Google Fiber lacked a bulk of sports programming as well as staple cable networks owned by Time Warner, such as Cartoon Network, TBS, and TNT. It also didn’t even give you the option of adding on HBO until now.

Like other cable providers, if you want HBO you’ll have to tack on an extra fee every month. The rate is $20 per month for all the HBO bundle of channels (HBO, HBO 2, HBO Signature, HBO Family, HBO Latino, HBO Comedy, and HBO Zone). For another $10 you can get the Cinemax bundle (Max, MoreMax, ActionMax, ThrillerMax, WMax, @Max, 5-StarMax, and OuterMax), too. You’ll also gain access to the HBO Go and Max Go streaming services, which are currently only available to those that subscribe through a cable service. Additionally, Google Fiber TV is offering a premium package for $40 per month that adds Starz and Showtime to the mix.

All rates are (I believe) slightly lower than what you’d be charged from other TV service providers, and at the end of the day it’s still probably cheaper to go with Google Fiber (with its blazing fast gigabit Internet package.) The greater Kansas City area customers will spend about $150 per month (not including taxes) to get HBO/Cinemax along with the standard bundle of over 150 cable channels and local broadcast affiliate stations. Pricing for Google Fiber in Austin, Tex. has yet to be determined, but Fiber employees at the city’s Google Fiber Austin event last week seemed to indicate that it wouldn’t be too far from what people are paying in KC. I’d imagine that would be true for these HBO and Cinemax packages, too.

Image via HBO

HBO’s fantasy saga premiere of the third season of Game of Thrones broke more torrenting records last night than the bells on Khal Drogo’s braid, the gold in the Lannister coffers, and the number of wildlings swarming into the Seven Kingdoms. Now that I’ve impressed you with my Game of Thrones knowledge, here are some actual numbers.

Hundreds of thousands of people illegally downloaded the show last night, breaking the record for the largest BitTorrent swarm in history, according to TorrentFreak.

“Never before has there been a torrent with so many people sharing a file at the same time, more than 160,000 simultaneous peers,” TorrentFreak founder and editor-in-chief “Ernesto” wrote.

Current estimates show that the episode has already been downloaded over a million times. Last year, the popular fantasy HBO series was the most pirated TV show of 2012, with 4.28 million downloads for a single episode. Despite these staggering numbers, director David Petrarca is unconcerned. He said that pirated consumption only fuels the “cultural buzz” surrounding Game of Thrones and makes the show even more popular and pervasive.

Game of Thrones is certainly popular in the tech community, which has some crossover with lovers of fantasy fiction. You can’t throw a stone in SOMA without hearing whispers of “winter is coming,” and it is perfectly appropriate to refer to huskies as “direwolves.” Granted, when you mention you watch the show to people outside of this community, say to your mother during a Passover Sedar, it is not uncommon for them to be shocked and appalled that you would tune in to a show that espouses rape, violence, and explicit sexual content and make you feel shamed over your matzoh (this is purely a theoretical situation).

Certainly, the entertainment and buzz contribute to the high rates of piracy. However, the legal way to watch involves an expensive subscription to HBO, which involves an expensive subscription to cable, and those who aren’t real-world Lannisters (or even Lords), must resort to illegal methods to get their GOT fix. That said, HBO still has plenty of paying viewers. Sunday’s premiere attracted 4.4 million viewers last night, up 13 percent over last year’s premiere.

HBO has been hinting at making its content more accessible to common folk through its on-demand streaming service HBO Go. At a premiere event last month, HBO’s chief executive Richard Plepler said there was a possibility of selling standalone access to HBO Go as part of a bundled broadband subscription plan.

Until then, legions of fans will continue to illegally watch as the battle for control of the Seven Kingdoms unfolds. Resistance is as futile as stabbing a Whitewalker.

HBO’s executive leadership seems locked on keeping access to the premium cable network exclusive to cable and satellite TV subscribers, the same isn’t necessarily true for its HBO Go streaming service.

At the Game of Thrones season three premiere event earlier this week, the channel’s chief exec Richard Plepler opened up about the possibility of selling standalone access to HBO Go as part of a bundled broadband Internet subscription plan. Plepler suggested that bundling Internet service with premium streaming video services could be part of a new evolution for how content is packaged, but didn’t offer any kind of hard time frame of when it could happen, reports Reuters.

“We would have to make the math work,” Plepler told Reuters.

And I think I speak for a whole slew of people when I say, HBO needs to get cracking on that math ASAP.

HBO Go’s streaming app provides on-demand access to hundreds of notable movies as well as a complete library of all HBO original programming, including The Sopranos, True Blood, Newsroom, and Game of Thrones. And since HBO Go is currently a complimentary service to the cable channel, you’ll need to spend about $25 to $40 on top of a regular monthly cable or satellite TV subscription bill.

Yet, if HBO Go did become something that customers could add on to their Internet bundle, Plepler indicated that it could drop the price of the streaming service to an estimated $10 to $15 per month. That means people who only wanted Internet and HBO shows would spend around $65 per month instead of the over $150 in monthly subscriptions as a result of having a full cable TV service within a bundle of services.

Depending on who you talk to and which reports you read, cable TV subscriptions are being seen as unnecessary expenses that can’t compete with low-cost streaming services like Netflix and Hulu Plus, each of which cost $8 per month for a large library of video content. Over the next few years, this could translate into drastically lower cable TV customer — and in turn cut into the lucrative revenue stream that HBO currently gets by keeping the channel paired with cable subscriptions. And when you look at it that way, pairing HBO Go with broadband Internet actually makes a lot of sense for everyone except the cable companies.

Image via HBO

Time Warner CEO Jeff Bewkes actually praised Netflix during today’s Q4 2012 earnings call, despite the streaming video service being a rival of his company’s premium cable network HBO.

That’s probably the last thing you’d expect to hear during an earnings call — especially since Netflix just debut its first HBO-quality original TV series House of Cards.

During the call, Bewkes gave credit for its efforts on House of Cards, the service’s nice user interface, and consumer friendly support across services.  He then followed up by informing shareholders that Netflix is not really in the same ball park when it comes to subscribers and original programing — and thus, not quite worth comparing to HBO.

HBO has a total of 114 million subscribers across the globe, which is over three times the total number of subscriptions from Netflix (33 million worldwide). HBO is also producing multiple original series, including newcomers Girls and Newsroom as well as certified hits True Blood, Boardwalk Empire, and Game of Thrones. Additionally, the debut of HBO’s HBO Go streaming service to domestic subscribers helped boost overall usage (streaming and cable viewing) by 80 percent compared to the same period last year.

“The strength of programming on HBO and Cinemax and the success of HBO GO and MAX GO helped generate the best subscriber gains in a decade,” Bewkes said during the call. “Both brands are an improvement at virtually all of our major affiliates [and] together, they added 1.9 million subscribers domestically for the year.”

While HBO has more overall subscribers, it’s worth noting that Netflix brought in more domestic subscribers in a single quarter than the pay channel did in an entire year. Netflix is also poised to launch more original programming later in the year, including a resurrected Arrested Development.

Still, HBO is forging ahead by increasing its international presence. Time Warner launched a standalone version of its HBO Go streaming service in the Nordic market, which doesn’t require subscribers to get HBO through a cable TV provider the way its domestic customers must do.

Today HBO also announced a new two-year exclusive contract with Game of Thrones creator George R.R. Martin to as a creative consultant on the show as well as develop new series for the cable channel.

Image via HBO

Comcast forged a new partnership with media startup Zeebox today to infuse live broadcast TV shows with a dose of interactivity.

Traditional broadcast television is really good at providing a way for people to sit back and absorb what’s on a screen, but it doesn’t really allow viewers to participate in the experience — unless you count changing the channel. Zeebox, however, hopes to change that by taking advantage of smartphone and tablets (aka the “second screen experience”). While watching a live program, viewers can pull up information about the show, see related content, socialize with friends, and more.

Most people are already using their devices while watching TV, but Zeebox makes the added interaction truly supplementary.

In addition to Comcast (and it’s media company NBCUniversal), Zeebox is also partnering with premium channels HBO and Cinemax. Hundreds of TV shows appearing on these channels –  like Boardwalk Empire, The Voice, True Blood, and others — will now get an official set of second screen enhancements for iOS devices, Android devices, and the web.

And while consumers are clearly benefiting from the added supplementary material, so are the media companies. Zeebox also makes it possible to show advertisements related to specific programs and sell merchandise that appears on a show. This in turn translates to more revenue for content producers.

Founded in 2011 by former EMI executive Ernesto Schmitt and former BBC iPlayer CTO Anthony Rose, Zeebox has offices in London and New York.

Premium TV channel HBO said today it will not be forming a partnership with video rental service Netflix.

Netflix CEO Reed Hastings insinuated that his company might form an agreement with HBO — either through a future content licensing agreement or content distribution deals — in a Q2 2012 letter to shareholders yesterday. In the letter, Hastings wrote: “While we compete for content and viewing time with HBO, it is also possible we will find opportunities to work together — just as we do with other networks.”

Many consider HBO’s content to be a very valuable commodity. HBO subscribers justify spending an extra $30 per month on their already expensive cable bills to watch shows like Boardwalk Empire, Game of Thrones, and True Blood. All of HBO’s original programming is only accessible through traditional TV subscriptions or through the channel’s streaming service HBO Go — meaning Netflix subscribers can’t watch it.

“We are not in discussions and have no plans to work with Netflix,” a HBO spokesperson told Reuters.

I’m not sure why Hastings’ comments got so much attention. Netflix previously branded itself as being more competitive with HBO than with other streaming video competitors, like Hulu and Amazon Prime. Also, HBO has historically been known to play hardball with Netflix. HBO has not only refused to license HBO original TV shows, it also forced Netflix to purchase DVDs at full retail price for use in its DVD-by-mail rental service.

However, one area where Netflix and HBO may end up working together in the future could be in co-financing future original shows. But for now, HBO seems intent on not forming any kind of deal.

Game of Thrones image via HBO

Speaking at an event in New York City yesterday, Kessler said there is no chance his company will make its original programs like True Blood or The Wire available to non-cable subscribers, according to a MocoNews report.

The HBO Go service is a streaming video extension provided to people who subscribe to an HBO package through a pre-existing cable or satellite provider, such as Comcast, AT&T, Verizon or DirecTV. HBO’s business model has transitioned away from relying on licensing from movies to bring in and maintain its base of customers. Now, the company produces original content like Game of Thrones and Entourage, which is worth the elevated cable bill for some customers. However, it seems the company has no plans to make those shows available through a streaming-only subscription similar to what’s offered by Netflix.

HBO currently has about 30 million paying customers, many of who take advantage of the company’s streaming options. As VentureBeat reported in late June, a third of its customers have downloaded the HBO Go iOS app, making it a success in the eyes of the company. HBO followed up with a similar app, MAX Go, for its sister network Cinemax in August. Yet, despite all of this digital activity, the company still thinks a streaming-only option isn’t worth bothering with.

Kessler also said his company sees cord cutting as a temporary phenomenon that will go away once the larger economy improves. (Although, people might also turn to illegal distribution practices like torrents or unofficial video streams.)

But I think its inevitable that HBO will transform into a streaming-only network. Right now, the company is getting a good stream of revenue through its partnerships with cable and satellite TV providers. But as costs rise and people cancel their service, HBO will have to revisit the cord-cutting business model.

The 3 million who’ve downloaded the app since its debut in May represent about 10 percent of HBO’s 28 million total U.S. subscribers, according to the company.

The HBO Go app grants paid HBO subscribers the ability to view the entire library of HBO content, which is composed of 1,400 episodes, documentaries and movies. HBO isn’t cannibalizing its current business since viewers must subscribe to a HBO package through a pre-existing cable or satellite provider, such as Comcast, AT&T, Verizon or DirecTV.

HBO’s business model has transitioned away from relying on licensing from movies to bring in and maintain its base of customers. Now, the company produces original content like Game of Thrones and Entourage, which is worth the elevated cable bill for some customers.

As an added incentive for subscribers to try the HBO Go app, the company has started releasing episodes a week early through the Go service. So, customers who tuned in for the fourth season premiere of HBO’s original series True Blood June 26 can watch the second episode a week early.

Like streaming video service Netflix, HBO’s Go app is available on the iPhone, iPad, most Android devices and on the web. However, HBO’s original programing is unlikely to ever show up through Netflix’s service.

Netflix clearly realizes the value in having exclusive content. In March, the company purchased the rights to produce new TV show House of Cards, directed by David Fincher and starring Kevin Spacey, for $100 million.

Despite HBO’s stand off-ish attitude towards licensing its content on other services, Netflix is still very interested in reaching an agreement to stream its programming.

For now, the only way to watch HBO shows is through a subscription or the HBO Go Apps.

Under the deal, Netflix will run the “House of Cards” political drama being directed by Oscar-nominated director David Fincher as an exclusive on its streaming video service late next year. This kind of deal could turn Netflix into a premiere network much like Time Warner’s HBO or CBS’s Showtime, if Netflix continues to accumulate more programming. And that could shift the balance of power from Hollywood studios to Netflix, which was previously just one more digital distribution channel.

Netflix is gaining power because it has more than 20 million subscribers for its movie service, an audience that is closing in on the 28 million subscribers that HBO has on cable TV. Netflix is thus in a position to disrupt traditional movie and TV service providers as it consolidates power on the internet.

Ted Sarandos, chief content officer at Netflix, told the Wall Street Journal that Netflix will pay a portion of production costs for the series, with Media Rights Capital (the independent studio creating the project) financing the rest. Sarandos declined to say how much Netflix is paying for the exclusive online rights. But Netflix’s fee for production costs is capped if the show goes over budget.

House of Cards is based on a book and BBC miniseries of the same name. Sarandos said that Netflix will take advantage of the web by airing as many as four episodes at the same time so that users can immerse themselves in the content. He said, “There is no reason for us to be tied to traditional business models.”

The Wall Street Journal noted that Netflix’s move into original programs is similar to the dawn of cable TV in the 1980s, when most networks had little original content. They started creating more original programs to run exclusively on their networks to differentiate themselves. That’s how HBO, Starz, Showtime and others were born. But the model brings risks for Netflix, which doesn’t have experience producing high-quality content or picking the right shows.

Netflix’s move comes after the pay-TV networks brushed it off. HBO decided not to sell Netflix any streaming rights, and Showtime waits a couple of seasons before licensing episodes. Such strategies would have doomed Netflix to distributing old content. In response to the growing power of Netflix, I suspect that the studios and pay-TV networks will try to find digital distribution alternatives to Netflix. That could be good for emerging alternatives such as OnLive, which plans to offer movie streaming services as well.

Netflix is committed to 26 episodes.

In other news, Netflix has been hit with five lawsuits in the past two months accusing it of violating user privacy rights. The lawsuit alleges that Netflix held on to customer data such as rental habits and credit card numbers long after people had canceled their memberships.

[picture credit: hawtmag]

Clearly, the protracted talks that Netflix has had over the years with Hollywood studios has taught the company that its better to own your own programs rather than just distribute them for someone else. The move could be an escape route for Netflix, which seems doomed to pay ever-rising fees to content owners.

Both Deadline Hollywood and the Wall Street Journal reported that Netflix is either in advanced talks or has outbid several networks in getting rights to House of Cards, a new TV series being directed by David Fincher and starring Kevin Spacey. Netflix is reportedly bidding more than $100 million, according to Deadline Hollywood. But the WSJ says the amount is much less. The point is that Netflix is willing to part with a lot of money to get content.

But the question is whether Netflix can amass a sizable amount of content to spread out its risks and to make its own exclusives attractive enough to get more consumers. Consider the fact that HBO’s audience dwindled after it stopped airing new seasons of The Sopranos. Content is a game where you go big or you go home.

Netflix has to date specialized in distribution of movies and TV shows, either through DVD disks sent through the mail or through digital distribution video-streaming deals on consumer electronic platforms such as the Xbox 360, the PlayStation 3, the Nintendo Wii, or the Roku box. The House of Cards show, a political drama based on a British miniseries, could air first on Netflix’s streaming internet service. Netflix now has more than 20 million subscribers, compared to 28 million for HBO.

The deal hasn’t been announced yet and most of the players wouldn’t comment to the WSJ. Under the terms being discussed, Netflix would have the right to distribute the series online before any other outlet carried it. Netflix’s users have increasingly adopted on-demand video streaming, which carries a monthly fee. Since users pay a flat fee to Netflix, they view the service as a better bargain than other on-demand streaming services. But the selection of movies is important to users. To date, Netflix has had limited appeal because it mostly has access to cheaper, older movies and TV shows.

But last August, Netflix agreed to pay about $1 billion over five years to Epix, a pay-TV channel owned by Viacom, Lions Gate Entertainment and MGM Studios. Netflix also grew 63 percent in subscribers from the fourth quarter of 2009 to the fourth quarter of 2010. Netflix now accounts for 20 percent of all digital movie watching, according to market analyst NPD.