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Editorial: Time Warner Conquers TV’s Fear of the Web

Mar 8, 2009  •  Post A Comment

Time Warner CEO Jeff Bewkes and his crew deserve credit for exploring the possibilities of putting more television on the Web—for people who are willing to pay for it.
As reported in Advertising Age, Mr. Bewkes is floating a plan, dubbed “TV Everywhere,” that would make all cable programming available on the Web in places such as YouTube, Hulu and MySpace. The catch? To access those shows, users would have to prove they subscribe to a pay TV service such as Time Warner Cable, Verizon’s FiOS or DirecTV.
The simplicity of the plan is part of its allure. It simply extends the basic logic of cable: “You like shows? Good. Pay for them.” It’s a way of adapting to the Web that newspapers either couldn’t or wouldn’t adopt, resulting in the evisceration of their business. It’s quite difficult to maintain revenue when you give away your content in a new medium and the advertising next to that content is discounted 90%.
Already, Viacom Inc. CEO Philippe Dauman has said his company is open to exploring the TV Everywhere model. Ad Age reports that NBC Universal, Discovery, News Corp. and Disney also are interested. Time Warner Cable competitor Comcast also isn’t reflexively shooting down the idea. The key to the project’s viability is universal participation. The industry’s walled garden has to offer all the shows that matter on an exclusive basis.
TV Everywhere is a low-risk way to adapt to changing content distribution realities without adopting the panicky “give-it-away-for-free” tactic that has contributed in the business weakness of print media. The key is reaching critical mass, with enough of the biggest TV industry players signing on to create an exclusivity that tells consumers they can’t get their fix elsewhere.
Three years into the Web video revolution that kicked off with ABC’s deal to put primetime hits like “Desperate Housewives” on iTunes, TV networks are figuring out ways to generate revenue from their high-quality content on the Web. Hulu has been a notable success in terms of drawing users (it’s now the fourth-most-used video site) and putting advertising next to the content. YouTube, the world’s biggest repository of both pro and Joe content, has had periodic business successes, but it’s still struggling to establish a real business model.
Perhaps the key is to mimic the dual-revenue-stream model that has propped up the cable model. If advertising on the Web isn’t quite enough to draw all TV content into the medium, perhaps adding a subscription-type revenue stream will make Internet video more ubiquitous—and profitable.

2 Comments

  1. First of all, television isn’t afraid of the internet.
    They’re not.
    The thing is they’re ABANDONING television at a spiraling rate. They’re abandoning over-the-air television, which is why the broadcast networks have no plans for the digital spectrum they’re being awarded.
    The whole TV Everywhere is a moronic one at best. Yeah, they could put shows on something like Hulu or YouTube, but people with dial-up access (they’re still around, you know) aren’t going to watch those programs on those services. They’re going to watch them on TELEVISION!
    The people who are going to sit down and watch those cable shows on the internet are likely going to have broadband, which means that 9/10 of them are already subscribed to a cable/satellite/fiber-optics service in the first place, meaning whatever profit they hope to make will be a minute profit at best, unless the plan is for the users to prove that they’re a cable subscriber and then pay-per-click afterwards if they are. And the consumer market won’t sit for that.
    When cable consumers have access to tech like video-on-demand and DVR, the need for pay-per-click cable programs online seems not only redundant but borderline idiotic, which is probably no surprise considering that Time Warner, the most poorly-ran entertainment company on the planet, is behind the TV Everywhere endeavor.
    Time Warner needs the internet revenue it lost once America On-Line lost its relevance at the turn of the century thanks to wider broadband, and freer endeevors like in2TV, The WB, and Kids’ WB aren’t really bringing in the money it wants from ads alone. Of course, it would help to actually advertise that they exist across the traditional broadcast outlets. Obviously another Turner edict, “Work like hell and advertise,” is one lost of the idiot class lining their pockets at the company greed built and arrogance destroyed.

  2. You make blogging look like a walk in the park! I’ve been trying to blog daily but I just cant find writing material.. you’re an inspiration to me and i’m sure many others!

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