Stories come and go in both the general media landscape and the blogosphere, but often the same issues remain on the radar, but driven by different players and events.
For example, recently we’ve seen coverage of the Hulu-Boxee affair, the possible launch of online video platforms by cable operators such as Comcast & Time Warner and the “trend” of cord-cutting (getting all your video online). In addition, we regularly see many bloggers complain that the cable industry won’t launch “a la carte” options, so that subscribers can buy channels one at a time.
All of the coverage can be summed up thusly: “I think cable programming costs too much.” It also seems to me that this is a reflection of the dominant attitude found online: All content should be free or priced very low. But what people really mean, whether they realize it or not, is that they don’t like cable’s current business model. Every suggested solution – let customers buy one channel at a time, cable programmers should give their shows away for free on the Internet – would disrupt the current business model.
What Lessons Can Be Learned from the Newspaper Business?
Many industries have had their business models disrupted in recent years; one example is the newspaper industry. The Chicago Journalism Town Hall recently took place and some observers came away with the notion that the way for print journalism to survive is to adopt the cable business model.
This is an ironic reversal, because it appears that cable’s model was built on that of newspapers and magazines, which generally depend on a dual revenue stream of subscription fees and advertising. Print media are currently grappling with the best way to deal with the Internet and whether it pays to give away your content for free online.
Daniel Sinker on Huffington Post pointed out that an iTunes “a la carte” model might prove to be very bad for news organizations. (In fairness, he also suggests that saving journalism might mean tearing down the established order.)
The Chicago Tribune’s Eric Zorn expressed his own concerns:
… until a few months ago… I believed that large news organizations could thrive online by using the TV/radio broadcast model—by making it difficult to enjoy content without being confronted with advertising messages.
But for a variety of reasons, this model doesn’t seem to work for online news, particularly in this economy. Newspapers can and do make money with Web advertising, just not enough to make up for the declines in print advertising.
I’m now a believer in the cable TV model. News organizations that generate significant original content should band together for their own survival and sell group subscription packages for unlimited access to their stories, photos, videos, archives and other offerings.
Mark Cuban summed it up in the title of his blog post: How Cable & Satellite Can Save the Newspaper Business. Cuban argues that selling content “a la carte” is a difficult business venture and suggests that newspapers partner with cable and satellite providers to offer exclusive access to content.
Now, I don’t know if these solutions are the correct ones to save print media. And it’s highly likely that the cable model will change at some point. The correct answer doesn’t seem to be clear to anyone. Some print outlets give away their content for free. Some put parts of their content online, but require you to buy the print version to get the bulk of it. Some have suggested that non-profit journalism is the correct path. Some companies are experimenting with various models.
This is true of other businesses, since cable programmers are in the same position of experimenting with a variety of approaches. Right now, they primarily rely on a mix of subscription fees from cable operators and advertising revenue. As I’ve noted previously, in an “a la carte” world, both of these revenue streams would be dramatically affected. It’s highly probable that this business model will change over time, but right now, mandatory “a la carte” would probably have a very bad effect on your viewing choices.
Cable’s Sinister Plot?
Just recently, Time Warner’s CEO Jeff Bewkes discussed a plan called “TV Everywhere,” that would put all cable programming on the Web, but only accessible to consumers who are already subscribed to a multichannel video service, whether from cable, DBS or a telco company.
And what were the headlines? “Time Warner CEO Plans ‘TV Everywhere’ — But Not For Everyone.” “Time Warner’s Bewkes Plots To Eradicate Free Content.” “Cable Tries To Stuff The Internet Video Genie Back In The Bottle.”
Yes, the cable cabal’s dark & sinister plan to not give its content away for free…
What I’m really trying to do is express my frustration at seeing coverage like this. The headlines could have been just as easily written in reverse. “Cable Expands Online Content for Subscribers” Or, “Cable Subs to See Expansion of Content Online Content.” And then there’s, “The Bundle gets Bigger; Cable Adds Content Online.”
I hope I’ve made my point that the business of online content is a little more complex than it might first appear to be. And new online content, available on demand for those who are already paying the freight, could be just the jumpstart that the online world needs.
Tags: a la carte, broadband video, cancel cable, cord-cutter, dump cable, online video
