The New York Times reported on Monday that what is currently free to be had by you and me (thank you Hulu!), might only be available by subscription tomorrow. Time-Warner Cable is leading the pack to make currently free VOD via web a thing of the past as soon as possible.
As the Times points out, “free” is not a sustainable business model; therefore, instead of making the crux of the web-VOD revenue stream come from advertisers, online viewers would be asked (politely one hopes) to pay a fee. Though the details are still to be worked out, this is all coming about so that the cable industry doesn’t suffer in the shift away from purely televised content. Please, shed a tear for them now.
What does this mean for HD? As content and viewers gradually shift to the Web and advertisers begin to lose out, cable companies are beginning to feel a serious pinch. To make up for lost revenue they want to directly address the viewer with their own content… Thus, Time-Warner, the content distributor, can offer its current subscribers legal access to content such as HBO Original Programming if they carry a T-W subscription and have an additional subscription to HBO (the content provider). We can only hope that soon they might experiment with a type of à la carte service that shuts out less viewers, similar to Apple’s model perhaps. And yet, it’s not only premium cable or that yearns to be made less free… nope— this business model is trickling down to popular common carrier fare such as episodes of “Lost” and whatever other hot programming du jour a network might see as worth holding back from unsubscribed eyes.
All of this is coming about just as broadband services open up even more bandwidth for hi-def movies and television shows to be streamed without the usual hiccups, burps and freezes that can taint an otherwise enjoyable viewing experience on a laptop LCD or a big-screen LCD with an HDMI or DVI connection from the computer. It means that you’ll be paying for lots of stuff by way of either an all-you-can-view monthly subscription account or, if the cable companies want to take a page from the hugely successful Apple mode, in an à la carte method where you’re billed on the spot only shows you intend on watching. Nevertheless, you will be billed. You can almost bet the farm that the corporate giants doing this might also charge a premium for hi-definition streamed content versus standard definition. They have made the distinction for you in terms of quality. This is exactly what MLB.com and other streaming media companies have done, or attempted to do in the past… and is exactly what Netflix is doing now with Blu-ray discs.
It’s not every industry that gets to operate as a near monopoly, and so it was bound to happen. Cable companies want to maintain their dominance, while the content providers, those that make the shows, continue to lose revenue for clinging to an outdated business model and realizing, almost too late, that the world had changed. Advertisers simply have a harder time on the Web and folks simply aren’t clicking through enough ads to make it worth their budgets and ROI. Therefore, advertisers are backing out of the equation, leaving the networks and cable companies holding the bag and enabling viewers to get a free breakfast, lunch and dinner of premium content. Trust me, I think information wants to be free (I love free, who doesn’t), but it also puts folks out of work and gives content providers much less incentive to manufacture product. There’s huge chasm right now between the two philosophies. The growing torrent of content that is out there will be ill-gotten gains for some or legitimate gains for others. But as Time-Warner goes so follows AT&T, Verizon, the sats and the nets… all of them trying to follow the filthy lucre wherever they can.
The New York Times article can be found HERE, but touché… you’ll need free login to view it.