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New business on demand
All over the country, bright red-and-black Comcast billboards trumpet a new kind of television: "Pick a show. Play it whenever."
This is TV on demand, cable's answer to satellite rivals and file swapping, and potentially one of the most radical transformations of television culture in decades. Enabling viewers to watch whatever shows they want, whenever they want, is already undermining the scheduled programming that has always defined the medium.
While this may sound like couch potato heaven, however, at least some traditional-television executives fear that it could mean business hell. Broadcast TV networks have long built their advertising revenue around fixed program schedules, and they have so far declined to give Comcast the rights to air their shows on demand.
This struggle is just one of the pivotal business questions facing the television industry as it adapts to a new world in which consumers have ever-greater options. New ways of watching, whether provided through official channels like Comcast or underground avenues like file swapping, threaten to undermine decades-old business concepts.
"All the new ways of delivering content will put pressure on old ways to do things differently," said Bernard Gershon, who heads the digital-media division of ABC News. "We recognize there are other ways to consume content."
Even without these technological developments, network programmers have been struggling with other major challenges. In recent years, for example, young male viewers have been abandoning prime-time TV in favor of DVDs, video games and Net surfing--depriving advertisers of a core target.
To compensate for these shifts, TV companies are trying different ways to make money, including a rising number of shows sold in DVD collections,
from "Seinfeld" to "Alias" to "24." Some network divisions are experimenting with different versions of shows released online, while others are even sending material to mobile phones in hopes that subscription charges or new digital advertising formats can help supplement the old 30-second ads.
Broadcast networks and other companies say they haven't ruled out the on-demand concept; they just need to make sure that they're getting paid. "We're not trying to be Luddites, but we want to be sure that there is an Internet business model that works," National Association of Broadcasters spokesman Dennis Wharton said.
Comcast, in the meantime, isn't waiting around. The cable giant says it expects to show more than a billion on-demand streams this year, adding that the two-year-old operation has actually helped increase the number of people watching scheduled programming. "What we're doing here is evolving digital cable from just being about more channels to delivering TV on your terms," said Page Thompson, Comcast's general manager of on-demand services.
