NEW YORK (AdAge.com) -- CBS, the lone broadcaster not participating in web TV site Hulu, is giving more content to a potential competitor, Comcast's On Demand Online.
CBS said yesterday it will lend content to Comcast's On Demand Online service, which is set to be tested with 5,000 Comcast subscribers in the coming weeks. The service requires that consumers prove they have a pay-TV subscription before offering access to cable TV shows such as HBO's "True Blood" and "Entourage."
Comcast's service adheres to a set of principles developed with Time Warner dubbed "TV Everywhere," intended to export the pay TV model to the web. It will require a log-on for consumers and contrasts with Hulu, the joint venture among NBC Universal, News Corp. and Disney, which requires no proof of pay TV service to watch shows online.
Comcast is busy pursuing both strategies, with both On Demand Online and its free TV and film portal, Fancast, which also distributes Hulu content.
Other participants in Comcast's On Demand Online include Time Warner's Turner channels, Liberty Media's Starz and smaller ad-supported cable networks such as Scripps, Rainbow Media and A&E. Time Warner is testing its own version of TV Everywhere on Time Warner Cable's system in Green Bay, Wis.
CBS is the first broadcaster to join TV Everywhere, but it's unclear which of CBS's content will be made available through the service. CBS shows such as "NCIS" and "Rules of Engagement" are already available on Fancast's free offering, as well as on sites such as TV.com and Yahoo, but it's possible CBS could add shows from its premium network, Showtime, such as "Weeds" and "Dexter," to On Demand Online.
In a statement, CBS said its trial will include "various types of current and library content."
The notion of TV Everywhere is an attempt to preserve the offline pay-TV model, which has remained healthy despite the ad-industry downturn and splintering of audiences. For the biggest cable networks, subscriber fees funneled through cable companies account for as much as half of revenue. It's considered a much better model than broadcast's 100% reliance on ad revenue. The question is whether cable can preserve its two revenue streams while also distributing online.
The TV Everywhere approach contrasts with Hulu, which was set up to accommodate broadcasters, which don't typically charge for their signal (although Hulu has made inroads in cable, too, winning some Warner Bros. and Viacom shows).
CBS pointedly did not sign on to Hulu in part because digital chief Quincy Smith did not believe in allowing a third party to exclusively distribute CBS content, and instead pursued a strategy of distributing shows widely across dozens of sites. "That's the best way to help the TV market and the online market both grow as opposed to being distant alternatives to each other," Mr. Smith said.
Ideally, he said, a consumer watching CBS content would be tagged with a cookie once and not have to sign in on all the sites participating, including the multiple cable operators. TV.com will implement a TV Everywhere-type solution sooner or later, Mr. Smith said, adding that TV Everywhere has the potential to close the gap between what broadcasters earn per viewer on the tube and online, in part due to superior ad targeting.
CBS could yet become a nonexclusive partner to Hulu, but those talks are hung up on a related dispute between Hulu and CBS's own TV site, TV.com.
TV.com, acquired in CBS's acquisition of CNet in 2008, has a deal to distribute Hulu, but Hulu blocked it late last year after it determined CBS was competing unfairly. That dispute is subject to talks and possible legal action.
For now, CBS is pursuing what appears to be an anti-Hulu strategy. "TV Everywhere," the release said, is a "framework to facilitate deployment of online television content in a way that is consumer friendly and pro-competitive."
When asked if there is room for another Hulu-type play, Mr. Smith said, "On the web you can't have too many movie theaters."