FCC chairman Julius Genachowski, pictured, is scheduled to make the announcement Monday, various news media reported.

The news is quite good for the online video industry and its customers, both of whom gobble bandwidth and increasingly threaten traditional video media such as TV broadcasters and cable TV companies.

The Net neutrality rules are intended to prevent cablers and telcoms from denying access to potential rivals, such as online video providers and Internet phone-service providers. A lesser form of discrimination emerged with the deliberate slowing of data packets.

Obama’s choice of Genachowski for the top FCC post virtually guaranteed Net neutrality would be adopted in some form. The tech-savvy chairman is a former venture capitalist who worked for Barry Diller’s e-commerce company IAC/InterActive Corp.

The FCC’s tilt toward neutrality predates the Obama administration, however.

Even before the president took office, the FCC strong-armed Comcast, the giant cabler and Internet service provider, into halting its practice of throttling media file-sharing activities. Comcast had been limiting the bandwidth resources given to heavy online video users. In 2005, a broadband service provider in North Carolina consented to stop blocking access to a Vonage telecommunications application.

The formal adoption of Net neutrality would give the FCC the power to shut down any similar activities by ISPs.

The outlawing of Net discrimination also helps protect against ISPs censoring specific Web sites or other online content providers.

At his confirmation hearings, Genachowski vowed to lead “a 21st century agency for the information age” that would ensure “the Internet remains robust, open and safe.”

The tax and audit specialist’s poll of 300 venture capitalists, corporate executives and investment bankers found that 52% expect VC investment in digital content creation to increase over the next two years. 25% said investment will increase by more than 20%.

Asked whether that investment would support user-generated content or professional offerings, respondents were evenly split.

Your freshly canned statement comes from Packy Kelly, KPMG’s man in Silicon Valley:

“Digital entertainment is such a vast and constantly evolving sector, and has had a tremendous impact on consumer habits. Investors will continue to seek opportunities to invest in those companies that are at the cutting edge of the disruptive technologies that are driving the evolution in how people communicate and access the information and content they are interested in.”

The most likely channel for VC funding ran through mobile, with social media, gaming and video the entertainment applications of choice.

Meanwhile … Steve Jobs seems to hate Adobe Flash, but Silicon Alley Insider makes the case that its video and animation player still could find its way onto the 3G iPhone.

Divx scored its first major content distribution deal, with Sony Pictures Television. “We are dedicated to finding legitimate outlets for our content and … are excited to be working with DivX,” said Michael Arrieta, exec vp at Sony. Interesting choice of words. DivX usually is seen in the company of pirates and copyright scoffers, but seeks to go legit with its cross-platform video download format. This is apparently the first time major studio content has flowed through DivX.

Divx also partnered up with D-Link for a media hub that wirelessly streams video content from the Net to your TV. Unlike Apple TV, no hard drive is involved. Also unlike Apple TV, HD is involved. Sorry Mac users, it’s Windows-only.

Comcast, one of those super-popular cable companies, debuted Fancast, a web site that’s part TV Guide, part IMDB, part Hulu. It’s still in marketing-friendly beta. The idea is you either watch the content there (usual suspects NBC, Fox, CBS — hey! more Hitchcock) or find out when your show is on. Or program your DVR from afar via the listings.

Comcast also broke out a video download process called wideband that allows really big movies to flow into your system in a little amount of time — say 4 minutes. They’re using 120 Mbps now while floating next-gen speeds of 160 Mbps or more. Catch cable chieftain Brian Roberts looking like a presidential hopeful on this video from his keynote. Yet another indication that the old-school guys realize our future isn’t going to involve shiny discs delivered via dinosaur fuel.

Envive Inc.’s TheaterStation is billed as a media server for people who never learned to program their VCRs. The $2,500 box comes with space for about 200 hours of DVD-quality video and is upgradable. The unit can handle high-def as well, delivered to the flatscreen via HDMI cables. View your own movies and buy some more via the same no-mouse onscreen interface. A pretty low price point for owning the consumer future right now, I’d say.

Marantz showed off its six-input HDMI switcher. Supports 1.3. Yep, we’ll be needing one. $350.

Samsung rolled out another HD DVD/Blu-ray combo player. Good luck, fellas. I’d be happy if my Samsung Blu-ray player played most Blu-rays successfully.

Engadget did a superior job covering the tech trade show. Check out their CES coverage and be amazed. Reuters has a low-fi CES slideshow.

Ad text:

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The blue-collar retail giant posted a one-sentence notice on its “media downloads” page noting that the service “closed on 12/21/07.” Users were advised to delete the page from their favorites.

That shouldn’t be too hard, considering pretty much no one knew or cared Wal-Mart was in the business. The service had been marked as in beta. (Now comes word that Wal-Mart has entered the SEO business. Brother.)

A statement from Wal-Mart on Friday noted that the service faded to black because tech partner Hewitt Packard decided to pull its tech backing.

“The market for paid video downloads has not performed as expected, and the broader Internet video space continues to remain highly dynamic and uncertain,” the technology company told the New York Times. (Gizmodo broke the story, apparently.)

Wal-Mart charged up to a whopping $20 to download a brand-new release, wildly out of touch with competitors such as iTunes, Netflix and Amazon Unbox. In addition, the retailer’s digital rights management system meant its movies worked only with the Windows Media Player.

When Wal-Mart launched the movie-download service about a year ago, it did so with the participation of the major Hollywood studios, all of whom depend heavily on the retailer for traditional DVD sales.

“The last thing I want slowing my internet service down are P2P freeloaders,” says free-thinker Cuban — yes, the media and sports zillionaire who financed Grokster’s defense in a P2P lawsuit — and the guy who founded Broadcast.com, a seminal provider of online multimedia and streaming services.

Jon Hart, a subscriber to Comcast’s Internet Performance Plus package, sued the cabler mid-month, seeking class-action status. His lawsuit says Comcast blocks access to P2P web sites such as BitTorrent.

Hart wants Comcast to stop using applications that he says pull the plug on P2P transactions. He also wants the cabler to stop advertising its premium hookup as a solution for downloading large files. The Associated Press broke the story on Comcast’s actions last spring, based on an Oregon user’s complaints.

“Comcast does not, has not, and will not block any websites or online applications, including peer-to-peer services,” Comcast said in a statement. “We have a responsibility to provide all of our customers with a good Internet experience and we use the latest technologies to manage our network so that they can continue to enjoy these applications.”

That network management means bottlenecks for P2P networks, but the file transfers eventually go through, Comcast says. Numerous reports say Comcast’s technique is to send data packets to the computers involved in the transfer indicating that the other computer has signed off.

“The only person/organization that benefits from P2P usage are those that are trying to distribute content and want to distribute it on someone else’s bandwidth dime,” Cuban writes on his popular (and obviously unedited) blog.

The Dallas Mavericks owner says “Comcast, Time Warner, etc., should charge a premium to those users who want to act as a seed and relay for P2P traffic. … Make (distributors) pay commercial rates. That will stop P2P dead in its tracks.”

In a follow-up blog post, Cuban cited all the hate comments he’s been getting from P2P Nation. “One thing continues to be a certainty in the technology world, NEVER challenge a sacred cow.”

And then in a third post:

So I’ve come up with a better way to get rid of P2P without calling for an outright disabling of the protocol. Maybe ISPs should just treat upstream bandwidth the way cellphone companies treat minutes. Give users an option on how many upstream bits they want to be able to use and during what times of day.

You can track all that activity in Mr. Cuban’s brain by reading the following posts from his blog and their comments:

An Open Letter to Comcast and Every Cable/Telco

Let’s chat about P2P some more

P2P Part 3

Meanwhile, assorted protests have been filed with the FCC. Net Neutrality legislation continues to struggle in Congress.

Hulu, the new online video site from NBC Universal and News Corp., is operating at least somewhat in the spirit of the web. Its beta search function produces hits on shows from rival networks such as CBS, ABC and A&E. Advertising Age has the Hulu story. …

“Why are fewer viewers watching the new fall television series?” the New York Times asks. “Perhaps because they are too busy watching video online.”

More Hulu: NBC Universal vows something like 3,600 hours of Olympics coverage on its nbcolympics.com video site, most of it live. That’s the spot to check out the weird Olympic sports like badminton that no one will touch on network TV. Oh yeah, the network said, some clips might will find their way to Hulu, the New York Post reports in a story on online Olympics ads. The B-status doesn’t sound good for Hulu, Silicon Alley Insider reports.

Miro, the new open-source video player, was released midweek. TechCrunch lists the advantages over Joost thusly: “Miro is open-sourced, DRM-free, friendly to all content creators, connected to all the popular video sharing sites like YouTube and blip.tv, high definition, full of content, and BitTorrent-enabled.” Mark Hendrickson calls it a “purer” player worth checking out.

High-definition: YouTube plans to serve up HD videos in the next few months. Reel Pop says streaming HD movies would contribute significantly to the video playground’s overhead costs. Meanwhile, Vudu, the set-top box download system, is conjuring up high-definition titles from Paramount and Lionsgate. The P2P-driven player went on sale last month. Read some of the early reviews on Vudu.

AT&T’s investment in Vobile — maker of “VideoDNA” technology for tracking videos as they cross networks — could lead to the telco blocking subscribers’ dubious downloads, Silicon Alley Insider speculates. Bitstreamers could counter with a shift to VPN services, the site says. Virtual private networks keep the snoops away from your online streams — but anyone who’s wrassled with one of these pain-in-the-ass connections would seek other remedies.

The video industry trades both positioned this bit of non-news as “just 10% preferred to watch a movie via streaming or downloading.”

Download Movies 101 finds it surprising that 10% of consumers actually do prefer downloading over just spinning a disc. The number probably is partially explained by the fact that all of the respondents reported they watched three or more hours of streaming video a week — read, YouTube.

The news stories didn’t say how the survey question(s) were phrased, but here’s betting it didn’t go like this:

“Would you prefer to download a rented movie for $3.99 and watch it right away on your computer or TiVo, or pay twice as much to rent a used disc that you have to pick up and return — or wait days for in the mail.”

When you consider something like 5% of the computer world is on Macs, that 10% looks a bit more promising.

“It was interesting to learn that while consumers are embracing digital entertainment, DVD remains the most popular means for viewing video content in the home,” said DEG co-chairman Matt Lasorsa of New Line.

Did DEG seriously expect to find anything else?

One interesting result: 24% said they would pay to watch a movie online (or burn a DVD) at the same time the movie runs in theaters — what the biz calls day and date.

The SmithGeiger-conducted study “Online Content: New Pathways of Discovery and Use” surveyed 1,035 broadband users in the U.S., ages 18 to 49.

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Of that total revenue, only 2.2% is expected to come from movies. “Entertainment,” including TV shows, should register 3.4% Real Networks’ SuperPass video service will pull 4.1%, AccuStream said.

The lion’s share, of course, goes to music, which is predicted to snare 85% via mostly download sellers such as the market-leading iTunes Store. Sports is tagged at 5.4% and news 1.2%.

The downloading of movies, forecast at $60 million in 2007, is up 133.4% over 2006, and is on track to break the $100 million threshold in 2008, AccuStream predicts. “Movie revenue growth has been hampered by limited availability of both front line titles and catalog depth,” the researchers note, to nobody’s surprise.

“Demand for premium content from studios and broadcast networks will boost revenue and share as offerings expand over a 3-7 year period,” commented Paul Palumbo, wonk-in-chief at AccuStream.

Want a copy of the report? No problem. Scrape together $1,900 and “add to cart.”

Here, Rob Pegoraro takes a shot at MovieLink and CinemaNow:

If you must obtain a movie in the next few hours but can’t leave your house or have anybody else pick up the flick, these two Windows-only stores might work. Otherwise, it’s unclear who would bother with them: They stock far too few movies, charge too much for them, offer them at a quality inferior to any DVD and grossly restrict your use of these purchases.

But, he allows:

Movielink is less annoying than CinemaNow, but not by much.

And the kicker:

Collectively, these sites amount to the most hostile movie-procurement option since the video store in Kevin Smith’s comedy “Clerks” (which, by the way, you can’t rent or buy at either site).

The movie downloading business has some serious PR campaigns to wage — most of the coverage I read is either clueless or hostile.

From setup to signup, to selecting a title and starting the show with a press of the remote’s play button, the Xbox 360 is simple. It is as easy to use as the on-demand and pay-per-view services familiar to most watchers of cable or satellite TV. … But at $400 for the model that includes a hard disk, which is needed to download movies, the Xbox is a big investment. If you aren’t a gamer, it is hard to justify spending that amount just to watch a few movies.

Writer Joe Hutsko notes that Xbox Live has 165 titles available for “rental.” A Microsoft spokesman vows there would be at least a title every day added to the service. The Xbox 360 elite, due this winter with its 120-gig hard drive, will make more video-related activities possible.

The story is pretty basic but a decent roundup of movie download options. It goes through the alternatives — the usual suspects such as MovieLink, CinemaNow, Vongo, the Unbox and the only Mac-friendly system, Apple TV.

There are scores of alternatives, but at this stage the movie selection is a factor for each one. Steve Swasey, a Netflix spokesman, said: “Whether it’s Netflix or Apple or Amazon or Wal-Mart.com, we’re all facing the same constraint: title availability.”

Not mentioned is the other advantage to the Xbox 360: its ability to play HD DVD movies. The format is on the run from Blu-ray, but this should be handy for a couple of more years anyway. The add-on HD DVD player, which I own, is cheap in all respects, but once you get it going, the high-definition magic does its thing.