Time Warner CEO Jeff Bewkes in a recent BusinessWeek article:
“We believe in TV everywhere, that consumers should have access on broadband to the same channels they see on television. But the online model has to support, not undermine, the distribution fee and advertising arrangements between programmers and distributors. Those with a subscription to a video service would also get access to shows online.”
“We believe in TV everywhere…” – it happens that TV Everywhere is also the name of a new cross-network, cross-industry initiative Bewkes announced several days earlier in an Ad Age interview. In short, TV Everywhere is designed to enforce the vision of the future Bewkes describes in the BusnessWeek article: to make internet access to cable network content possible only if you can prove you also happen to have a multi-channel (i.e. cable, satellite or fiber) television account.
To the technical purists among us, this might seem a bit like limiting the availability of the Model T to those who can prove they already own a horse, but it’s worth remembering that an awful lot of money flows from the consumer to the cable carrier and on to the cable network: in fact, it amounts to 50% of the networks’ income. In other words, the cable networks need the carriers - and they won’t make a truly comprehensive move onto the internet without bringing them along for the ride.
Conversely, the availability of cable network content is the primary value proposition of the cable/satellite industry, especially now that terrestrial networks are broadcasting in HD over the air. In other words, since good reception of a local affiliate’s broadcast is less dependent on that cable connection, the cable carriers need the networks, now more than ever - and so are doing the heavy lifting of putting the “TV Everywhere” initiative together.
It’s a very lucrative (and interestingly circular) business relationship - and one that both parties have an interest in protecting from the wild-wild-west of the internet.
So, which major players are on board? On the network side, we have Viacom and (Hulu co-owner) NBCU, while (Hulu’s other co-owner) News Corp. and (Apple-friendly) Disney are said to be in talks. On the carrier side, DirecTV and Dish Network have yet to officially announce, but Bewkes clearly intends to include the satellite carriers. Comcast, meanwhile, plans to stick with their “Fancast” service for now, but has made some friendly remarks about the two services possibly becoming compatible. Of course, the prospect of an ISP such as Comcast (the largest MSO in the country) selling both their own proprietary internet video walled garden while simultaneously selling internet access raises issues of net neutrality - so in Time Warner’s case, it’s interesting that the conglomeorate that includes cable networks Turner Broadcasting and HBO) will be splitting off the Time Warner Cable subsidiary on March 12th – just one week after announcing the TV Everywhere initiative.
So what exactly is “TV Everywhere” going to look like? Evidently an identity-based access system running over the top at “no extra cost” to the user. I imagine the pledge to make the service free is based on the fact that recent election-related spikes in internet streams of The Daily Show and SNL clips did not appear to cannibalize broadcast ratings and that all-important symbiotic relationship between the carrier and the cable network. There’s something most coverage of TV Everywhere misses, though:
The most interesting thing about TV Everywhere is that it’s still only about the PC/web browser/mobile device - conspicuously absent is any mention of network-enabled televisions and set-top boxes.
The next generation of internet-enabled television hardware is the elephant in the room - and the content owners know it: how else to explain NBCU and Fox suddenly forcing Hulu to back out of Boxee once it became clear the service was ultimately aimed not at the (lean-forward) PC but at the (lean-back) TV? (I would’ve thought the prominent placement of the letters ‘b-o-x’ in the company’s name would’ve been a red flag, but that’s just me.)
The whole TV Everywhere model is intended to preserve the current carrier/cable network revenue stream. To that extent, it’s intended to prevent (or at least slow down the progress of) access to internet video from the television. That’s going to be difficult, though, because while users really don’t care whether their programs arrive at the TV via a cable stream or via IP packets, what they ultimately will demand is the same freedom from program schedule tyranny they enjoy over on a website - in other words, it’s not about “TV Everywhere” - it’s about “TV Anytime.”
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