The big shake-up coming to television
The last really big shake-up that came to television was the advent of cable but since that point it has really subsided back into business as usual. The same crap but on 500 channels that we are forced to buy into as the good is bundled with the bad. There has been a lot of talk about a la carte style programming which is suppose to allow subscribers to pay for only the channels they want but to this point both networks and cable companies have been resistant.
Then along comes broadband speeds and an increasing willingness of people to turn to the Web for their video fix. Even though heavily geotarded sites like Hulu show us that it is possible to find a growing audience for series type television shows. This of course followed on the heels of sites like iTunes where you could download shows for a set price.
Now I might not agree with the idea that Apple is anywhere near knee-capping the cable companies but any discussions that entail consumers being able to have control over their own viewing habits is one we should be having. It is in this environment that we are finding ourselves and the television networks and cable companies may not have the control they think they do over the whole scenario.
Since word broke that Apple is talking to television networks about some sort of subscription service that would see consumers being able to subscribe to individual show series’ the cable companies are making noises that they want the same kind of deal.
“If Disney and CBS believe this is the model to embrace, it’s worth pondering whether they’ll embrace that for all distributors,” said Melinda Witmer, Time Warner Cable’s chief programming officer.
The Time Warner Cable comments underscore how much Apple’s possible subscription service threatens to fray the television ecosystem. TV companies make money by selling bundles of channels to Time Warner Cable, Comcast Corp., DirecTV Group Inc. and other distributors through which roughly nine out of ten American households watch TV.
If TV programmers agree to let distributors select piecemeal channels to sell to consumers, it could threaten smaller cable channels such as News Corp.’s Fuel TV and Lifetime Movie Network, owned by Disney, Hearst Corp. and NBC Universal. It also could push down the overall payments TV-network owners receive from cable-TV, satellite and telecom companies.
Source:Wall Street Journal
This transition to consumer choice in television viewing via Internet isn’t a matter of ‘if’ anymore but rather of ‘when’ and who is going to be the first to cross that line. It will result in the biggest transition in television that we have ever seen and it scares the hell out of the networks because they will not have the same control anymore.
For consumers it will truly be television on demand and only what you want to watch without being burden by a bunch of stuff you will never end up watching. It will also have a profound effect on the very television shows that we watch and this is worrisome to the networks as well because it is no longer a world of national blockbuster shows but rather niche blockbusters.
For advertisers this will only be an extension of the hell that they are already going through with the transition of print to web. The last bastion of their dominance really is the television world as it is now. As television changes, as print has, advertisers are going to find that ad fragmentation and the importance of niche groups will only increase as will the difficulty in finding ways to maximize this new territory.
There is one bottleneck to this transition though that no-body is addressing and that is the cable companies, as well as the telecommunication companies, hold the keys to this new television landscape. It is interesting that at the very time that companies like Netflix are increasing their availability of streaming movies and television companies are looking to do the same thing with their products the broadband providers are increasingly capping consumer accounts.
On one hand the cable companies are wanting to offer up the same kind of subscription deals as well as provide the pipe for other companies providing such a deal but on the other hand they are telling consumers that they are going to need more expensive plans to enjoy these new services. It is one thing to offer up television series’ subscriptions but all those shows will count against any caps you might now have imposed. Caps that once you go over will either have you paying extra for every byte over or you could see your account degraded to dial-up speeds.
As it stands right now both the television industry and the broadband provider business are trying to position themselves where they are still in control and they are making more money than before. In effect it isn’t about giving the consumer real choice but rather about stalling as long as possible until they can be sure that the status quo doesn’t change all that much and they can still screw the consumer.
There might indeed be a shake-up coming but I’d be willing to bet that when all is said and done the consumer will still be getting the short end of the stick.