In an effort to acknowledge the Web as an acceptable form of entertainment for consumers and to do their best to keep a strong grip on their business models, the cable and satellite companies have been experimenting in something called TV Everywhere.
The idea behind TV Everywhere is to allow paying subscribers the ability to access content online that also is found on their TVs. Think of it as Hulu, but with everything (including shows from HBO).
Sounds good, right? I mean, most of us pay for cable or satellite now anyway, so we might as well get more out of it (assuming this isn't just a ploy to hike subscriber fees). In fact, according to a recent Business Insider article:
The TV business is only 50% ad supported, with $68 billion coming from advertising. When you tally up TV subscriber fees collected by cable, satellite and telcos, it comes to, well, about $68 billion. And the reality is, between cable, satellite and telecom TV offerings, 90% of Americans pay for their TV.
Translation: There is a lot of money at stake, so let's make sure we do this next phase right.
While I won't comment on the overall cable model in an age of the Web and social media, I recently read an article stating that subscribers will be able to access cable content online from either sites owned by cable/satellite operators (i.e., Fancast.com) or those sites owned by networks (i.e., HBO.com).
And that's the part that got me to write this blog. Limiting access to those sites alone is a huge mistake (for consumers, content owners, and cable providers), and it makes me fear that some traditional media companies care more about the next quarter than they do about their future.
If FB and MySpace have taught us anything, it's that we're in an age where instead of trying to drive consumers to where you are, you need to go where they are. When you know that 100 million-plus people in the US are on social networks, tens of millions use YouTube and other video sites, and millions are on even more advanced platforms like Boxee each and every day, it would seem logical to allow users to access cable content there as well (if those sites comply with what will hopefully be fair and realistic terms and conditions).
I do not believe that people will suddenly flock to Fancast.com or HBO.com in larger numbers than today. The Web is all about discovery, consumption, sharing, and interaction. Boxee does this well. Time Warner Cable, uh, not so much.
What happens if I'm a paying HBO subscriber and I'm watching an episode of HBO's How to Make It in America via TV Everywhere and I publish that into my MySpace or FB stream and a friend sees it?
Would I even be able to do that? What happens if a friend clicks on it and isn't an HBO subscriber? Does he/she just get a "Sorry, you don't pay us enough to watch this" alert? Does he/she have to pay $1.99 a la carte to view it?
In an age when people share everything from what they are watching to where they are eating, being able to share content online is essential for awareness, growth, and usability.
My suggestions to cable/satellite companies:
- Allow multiple sites to be authentication partners. Include sites that demonstrate strong entertainment experiences and a loyal/scalable following. Make content accessible via their mobile apps as well (assuming the rights are available).
- Don't be completely stingy with the revenues. Pro-rate based on activity at individual destinations. The Web is not something cable companies are going to be able to fully control (and the same can be said for mobile). However, they are in a position to contain it to some degree if they play their cards right.
- Fix the cable UI in the living room. All of this is for naught if you don't improve the value consumers get in the living room. Address unusable navigation and discovery tools, inconsistent service, and a whole lot of commercials (that less and less people watch every day).
Keep the sites happy, make consumers happier, and allow revenues to continue to flow into the best business model media's ever seen... which in turn keeps content owners and cable providers happy. I hope the people in charge think this part through carefully.
— Jason Kirk is Vice President of Video and Entertainment at MySpace.