NEW YORK (AdAge.com) -- TV Everywhere, Time Warner's industrywide initiative to make cable TV programming available on an on-demand basis online to any multichannel subscriber, has its first distribution partner. Cable operator Comcast will test TV Everywhere's authentication technology, beginning with a technical trial in July in which 5,000 subscribers will be able to view programming from Time Warner's Turner networks TNT and TBS through Comcast's On-Demand Online service.
Brian Roberts, CEO of Comcast Corp., said the feature is expected to be rolled out nationally to Comcast customers some time in fourth-quarter 2009.
'We want more!'
"The consumer has more than spoken, they've pretty much yelled, 'We want more options than the industry has provided,'" Time Warner CEO Jeff Bewkes said in a teleconference. He added that the multichannel-video industry, or pay-TV industry that broadly covers cable operators, satellite-TV providers and telecoms such as Verizon, has become the "healthiest part of the entire media business," with consistent quarterly growth for the last 30 years.
It's precisely that growth pattern that Mr. Bewkes, Comcast and the rest of the pay-TV industry want to protect with a paid-subscription model online to prevent "cord-cutters," or consumers who cancel their cable subscriptions and watch all their TV content online. The cord-cutting phenomenon has already harmed the broadcast networks, which have lost ratings and revenue by making their shows available free on their own ad-supported sites as well as on Hulu. Walt Disney Co. recently took a 27% stake in the online video company, comparable to stakes held by founders NBC Universal and News Corp.
"The broadcasters are going the way of the music industry by streaming singles and killing albums," said one industry insider.
With TV Everywhere designed to give more value to the bundled cable TV/broadband subscription, it's no surprise industry analysts have suggested Hulu should be seeking a dual revenue stream as well.
CBS distances self from Hulu
"Now that Hulu has acquired programming from ABC and has access to three of the four major broadcast networks, we believe the time is right for Hulu to seek a fee from broadband providers," Rich Greenfield, a media analyst for Pali Research, wrote in a May 21 note. "Just imagine if Verizon signed a deal with Hulu. ... We find it hard to believe that Time Warner Cable or Comcast would be able to lose all 'legal' online access to broadcast TV content from Fox/NBC/ABC. Similarly, imagine if CBS demanded payments from broadband providers in order to access CBS TV (via TV.com) or March Madness content (via CBS.com)."
CBS, for its part, has distanced itself from Hulu and other syndication deals, a move that seems to have helped the network become the only broadcaster to actually increase in ratings this season. However, the company showed support of TV Everywhere via a statement this morning.
"We are in favor of any proposal to help extend our business in such a way that is open and nonexclusive; consumer friendly; and responsible to our advertisers and shareholders," the statement read. "Initiatives like TV Everywhere and OnDemand Online are the very reason why we believe it's imperative to control our own programming online. We look forward to continuing discussions with cable operators -- and all distributors -- to seek partnerships that recognize the value of our content."
Mr. Bewkes said the next step for TV Everywhere is to create an online ad model consistent with the existing TV ad model. "The goal on advertising should be to extend the current viewer-measurement system on advertising that is being applied to TV and move it so it can be applied to VOD watching on broadband."