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DirecTV to Join TV Everywhere

Satellite Company in Talks to Launch Own Version for Web Video

By Published on . 4

NEW YORK (AdAge.com) -- The cable industry's plan to get viewers to pay for TV on the web is getting a powerful new ally. But it's not cable. DirecTV, the nation's largest satellite TV operator and second-largest pay-TV provider to Comcast, is in talks with cable networks to launch its own web video service under standards known in the industry as "TV Everywhere," according to executives with knowledge of the talks.

DirecTV intends to brand its online service as Comcast did with 'On Demand Online.'
DirecTV intends to brand its online service as Comcast did with 'On Demand Online.'
The move would allow DirecTV's 18 million U.S. subscribers to access cable TV on the web for free, as long as they can prove they subscribe to a corresponding package of programming via satellite.

"We've been in active discussions with an array of programmers for some time now," said DirecTV spokesman Robert Mercer, adding that "elements" of TV Everywhere "are consistent with our approach."

The cable-led initiative branded "TV Everywhere" by Time Warner is really a set of principles for pay-TV distributors that allow them to offer cable programming online. While DirecTV is agreeing to those principles, it intends to use its own technology to "authenticate" its customers on the web. DirecTV will also brand its service, as Comcast did with "On Demand Online."

Whatever it's called, the cable TV industry has painted TV Everywhere as its best hope to preserve its economic model online. It's a model where as much as 50% of revenue is derived from cable subscription fees.

Subscribers to pay TV packages on cable, satellite or a telco would be able to enter a subscriber number or some other identifier and access programming on the web. Ideally, that subscriber would be identified by a cookie in his browser that would open up pay-TV content on many sites.

Right now, the trials are limited to TV distributors such as Comcast, Time Warner Cable and DirecTV that already have distribution deals with cable networks like Time Warner, Scripps and Starz, but deals could be extended to other sites such as Hulu or TV.com.

The addition of DirecTV, controlled by John Malone's Liberty Media, would bring an entirely different company into the mix. Unlike cable and the telcos, DirecTV has no internet access business, nor does it own content, though Starz, also owned by Liberty, is already adding films to TV Everywhere. It does, however, provide content over the web and to mobile phones for subscribers of NFL Sunday Ticket through a service called Supercast.

Comcast's version of the plan, "On Demand Online," is in trial phase for 5,000 customers on its owned sites Fancast and Comcast.net, and includes content from 23 networks, including Time Warner's HBO, Cinemax and Turner's TNT and TBS, CBS, AMC, Scripps Networks, A&E Television Networks and Starz. Time Warner Cable is conducting a similar trial with HBO in Milwaukee.

DirecTV declined to say how close it is to announcing a deal, or what the service will be called, but Mr. Mercer said the company "will be prepared to launch a similar product around the same time, if not before, others in the industry."

The TV Everywhere effort is an acknowledgment that the predominant model on the web -- free via ad support -- works fine for broadcast TV on sites such as Hulu, but not for cable. The question is whether other networks will embrace the plan. NBC Universal's Jeff Gaspin has said, "I'm a big fan of authentication." Disney's Bob Iger, a latecomer to Hulu, expressed some skepticism about the plan, but Disney already had its own version of a paid broadband video service with ESPN 360.

Viacom CEO Philippe Daumann has also expressed support for the concept. Viacom is pushing the boundaries with some of its shows; Comedy Central distributes "The Daily Show" and "The Colbert Report" on Hulu, in part because the shows are topical and don't have much value after their initial broadcast date.

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