February 20, 2009, 04:30 PM EST The Minefield of Online Cable-TV
By Sam Schechner and Vishesh Kumar Wall Street Journal http://blogs.wsj.com/digits/2009/02/20/the-minefield-of-online-cable-tv/?mod=rss_WSJBlog?mod= Before building a walled garden for cable TV content, cable operators and TV programmers will have to clear a minefield. Comcast and Time Warner Cable have each been meeting with cable networks to explore putting wide swaths of cable-TV content online, behind a subscription wall, as reported in Friday’s Wall Street Journal. But multiple technical and business issues remain unsettled, and they could cause wrangling in the already fraught relations between the networks and operators. TV programmers that have been discussing these or similar ideas with at least one of the cable giants in recent months include General Electric’s NBC Universal, Time Warner’s Turner Broadcasting, Viacom’s MTV Networks, Discovery Communications, Scripps Networks Interactive and News Corp.’s Fox Networks Group, according to people familiar with the talks. (News Corp. also publishes The Wall Street Journal.) Some network owners said they are cautiously optimistic about the concept of providing online content for paying subscribers. “This could be an important innovation that extends the cable business model into the rapidly growing interactive space,” Scripps said in a statement. Comcast and Time Warner have each been floating different proposals, but neither is offering to pay the networks extra to put their shows behind the subscription wall, according to people familiar with the talks. Operators and programmers have been fumbling with consumer-friendly titles for the idea, which, during talks, was referred to as “authentication” or “entitlement.” Comcast currently refers to it as “on-demand online.” Operators sometimes called the concept “entitlement” because they say the billions in subscription fees they already pay the networks entitles their subscribers to the content, say people close to the talks. That posture could turn off some TV-network executives who believe they should be paid for their online rights. Cable operators and programmers may also tangle over how or whether to split ad revenue from online video that would be accessible to subscribers. On traditional TV, operators usually get to sell some ad inventory, but programmers might, for instance, chafe at sharing revenue from ads that appear on their own Web sites. Another question is how long the networks’ TV content would be available only to subscribers before it could appear on non-subscriber platforms, according to one network executive. More broadly, some cable-TV programmers are adamant that any effort to port the cable-subscription business model to the Web should include all distributors — including satellite and telecom companies — and on all Web sites, including their own. Cable operators like Comcast and Time Warner are open to bringing in other distributors and allowing programmers to host the content on their Web site, according to people familiar with the talks or the companies’ thinking. Many TV programmers already showcase some of their content on their own sites and platforms, where they can sell integrated advertising and build their own brands, and hope to do the same with any subscriber-only content. They’re also wary of undermining competition among pay-TV distributors; competition has helped content owners boost subscription fees in recent years. -- ================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 Mail: antunes at uh dot edu *********************************** * POST TO [email protected] * *********************************** Medianews mailing list [email protected] http://lists.etskywarn.net/mailman/listinfo/medianews
