Online Streaming Business Models
Dear Diary,
TV networks have had a good thing going for a really long time. They produce, advertisers pay, viewers watch, everybody’s happy. Only these days broadcast nets are making less shows, advertisers want to pay less, and viewership is down. Now TV execs are all in a tizzy over how to make money off the internet. So they’re throwing everything against the wall, hope they will convince us to cough up some money for what we watch online. So what do we get for how money? Depends on who’s doing the peddling…
“TV Everywhere”
TV Everywhere is an effort by cable companies, specifically Time Warner and Comcast, that would allow everyone to watch TV programs on computers and mobile devices for free. Yippee! Except “everyone” means only existing cable customers and “free” means whatever you pay for cable and internet access. I don’t know about anyone else but I pay a lot. And I don’t even have premium channels.
Several cable networks, including HBO, Syfy, and AMC are participating in Time Warner’s test of the TV everywhere program. Reportedly programming on the site will include the same full complement of commercials as the television broadcasts. And with ad-skipping disabled, to boot. So rather than using technology to broaden our options they’re abusing technology to limit our options. Nice. Clearly the cable companies would rather not have to deal with digital streaming at all but they are desperate to no be left out of the loop. Me, I’m not at all sold on the TV Everywhere concept. As far as I’m concerned, my cable box is on borrowed time…
Hulu by subscription
I have no idea what Hulu.com might look like as a subscription site, which it could be as early as next year, but currently, the site fails to impress. Their selection of programming is so very limited. Particularly when it comes to current shows, where the selection is usually limited to five episodes of the current season and who-knows-what from previous seasons. Then there are the “windows” between the broadcast airing and the online streaming. There’s a one day window for ‘Stargate: Universe’ and ‘Heroes’ but a four day window for ‘V.’ What gives?
The broadcast networks are taking their content directly to audiences, no cable middle man necessary. Hulu is a joint venture between NBC, ABC, and Fox. But here’s where things get tricky: the owners of Hulu own or have ownerships stakes in numerous cable networks, including Syfy, USA, Bravo, A&E, Lifetime, ESPN, and FX, just to name a few. Cable cos. can’t be too thrilled that content they once provided exclusively being made available online without them getting a cut. And the cable channels certainly enjoy the broadcast fees they get from cable companies. Will the Hulu companies share their content with TV Everywhere efforts? Will cable companies be pleased if they don’t?
iTunes TV
Apple is hoping to become the newest middle man, proposing a system the would provide streaming content to viewers via iTunes for a flat fee of $30/month. No cable subscription necessary. There are no networks currently attached to Apple’s effort. But $30 is a heck of a lot less than I pay for cable right now. But there are no specifics. Would there be ads? How many ads? Can you skip the ads? Can you watch programs on your iPhone? Will there be content from premium cable channels? What kind of “window” are we talking about?
One thing that Apple has going for it is that iTunes is a familiar portal where people are used to paying for music, movies, and TV shows. And the price makes them an attractive alternative to cable. But it remains to be seen what content they will have to offer.
It seems clear that the cable/satellite TV model is under serious threat. I know I’m planning to drop cable all together in the next few months. It’s comforting to know that TV networks are trying to get on board with online streaming. Personally, I’m leaning towards this Apple deal but, we’ll see…
Still a fan,
C.C.
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