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Bernstein Research Skeptical of Google TV

 "Google is now in the pay TV businesses, sort

That was the lead line on a Bernstein Research client
advisory on Google's
announcement of details
of its Kansas City fiber-to-the-home broadband TV
and Internet access offering, which Googleannounced in March 2011.

"Sort of" because the Wall Street research firm
points to the "significant holes" in its program lineup. While its TV
offering includes networks from Viacom, Discovery, Starz and NBCU, it does not
include Disney (it does include the local ABC affiliate), Time Warner or News
Corp., so no CNN or Fox News or ESPN, three essentially must-haves for any
cable system.

Comcast/NBCU might not be in there either save for the FCC
requirement in the NBCU deal that Comcast make its programming available to
online distributors.

"Without the full suite of traditional cable channels,
it is doubtful Google will be able to attract core TV viewers and get them to
switch from traditional cable," Bernstein Research says in the report. The
researcher is also concerned about the upfront costs for high-speed access.

"[The] launch leaves many questions unanswered, the
most important ones are whether or not Google Fiber offers will attract large
number of customers in the Kansas City market and whether or not Google will be
able to make its experiment into a profitable business without material
subsidies," the report says.