1/26/13, "
Watching TV on web is disrupting cable, broadcast worlds," Miami Herald, Glenn Garvin
"
When Barnett and 5,000 or so others gather Monday for the National
Association of Television Program Executives (NATPE) convention at the
Fontainebleau Hotel on Miami Beach, there will be plenty of sweaty
foreheads, some acquisitive smiles and — perhaps most numerous — blank
looks of confusion. Not since cable turned the old three-channel TV
universe on its head in the late 1970s has the industry been in such a
state of disoriented befuddlement.
New technologies that give
viewers more say in what they watch, where they watch and how much they
pay for it are great for consumers. But they’re inducing a collective
nervous breakdown among industry executives, who have to figure out new
ways to make money in a business facing serious threats to its
traditional sources of revenue — advertising and cable-TV subscriptions....
The industry last year was blindsided by
everything from a leap in the use of TiVo and other digital
video-recording devices
that pushed Nielsen ratings down as much as 50
percent to a new device called the Hopper that allows viewers to
instantly zap by commercials.
But the biggest tremors came from
the Internet, which is threatening to remake television as thoroughly as
it already has the newspaper and music industries,
by letting viewers
bypass cable to watch shows online.
There was explosive growth in what the industry calls over-the-top or
OTT, little boxes that sell for as little as $50 or so and allow
viewers access to hundreds of streaming-video Internet television
channels from their TVs. Apple and Roku, who make the most popular OTT
players, have sold about five million apiece. But other companies like
Amazon, Google and Western Electric are pushing into the market, and
industry analysts say Intel, the world’s largest semi-conductor chip
manufacturer, is also poised to leap into the OTT business.
Another
major OTT force: video-game consoles like Xbox and PlayStation, which
can also be used to watch streaming Internet video. “They may be doing
more business than anybody,” says Andy Tarzon, founding partner of the
media research company TDG. “Xbox is the leading viewer for Netflix
content.” It will, soon enough, have its own content; parent company
Microsoft late last year hired senior CBS programming executive Nancy
Tellem, who helped develop
Friends and
ER, to direct an on-line TV operation.
• The
use of programming services that deliver television program via the
Internet is mushrooming, with Netflix, YouTube, Amazon and other big
names — even Walmart — setting up or expanding operations. “More than
anything, that’s gotten everybody’s attention,” says Terence Gray, a
longtime network producer who now runs the New York Television Festival.
“When you see YouTube’s $100 million investment in programming, or what
Amazon’s studios did last year, or Microsoft hiring Nancy Tellem, this
is no longer a conversation. This is being
done.”
Hulu,
a website that offers shows from NBC, ABC and Fox, doubled its
subscribers last year while increasing its revenue 65 percent.
Meanwhile, many of the online services are starting to make their own
shows: Hulu debuted 10 of its own programs last year and Netflix has
five in production, including
House of Cards, a political thriller starring Kevin Spacey that debuts next week.
Attacking cable from a different direction,
Aero TV uses tiny but
powerful antennas to capture broadcast signals from the air, records
them, then reroutes them into a viewer’s computer or OTT player to be
watched whenever he wants. Because Aero pays nothing to the broadcasters
(a practice being challenged in court) it can offer its service for as
little as $8 a month. Last year’s start-up in New York City was so
successful that Aero is expanding to 22 more cities — including Miami —
this year.
Senior television executives caution against any
expectation that their industry is about to embark on an instant
makeover, and the numbers bear them out. Hulu’s three million
subscribers are about one-seventh the number of viewers who watch
NCIS
each week on CBS, and its $700 million in annual revenues is tip money
compared the $3.4 billion CBS generated in a single fiscal quarter last
year. “This is going to be an evolution, not a revolution,” says Bruce
David Klein, president of the independent production company Atlas
Media.
But the technological advances in Internet television come
at a time when customer grumbling over escalating cable prices has
grown to a roar and a younger generation of viewers more comfortable
with computers than TVs is starting to set up its own households. The
new alignment of attitudes is already taking a toll.
Subscriptions
to cable and satellite television peaked in 2010 and have fallen five
percentage points since then, the research company TDG reported late
last year. Meanwhile, consumer satisfaction with cable service, which
had held steady for years between 65 and 70 percent, dropped 10
percentage points.
“The most interesting part of that report, to me, was that it said a
lot of the people without cable are
not ‘cord-cutters’ but
cord-never-havers,” says Jim Flynn, president of Massachusetts-based
Overlook TV. “We employ some of those people at my company. They’re in
their early 20s, just out of college, and for them,
paying $100 or $200 a
month for cable TV is just not an option. And they don’t feel bad about
it. They’re part of this millennial generation who are perfectly happy
getting all their video over the Internet.”:...via Free Republic
Read more here: http://www.miamiherald.com/2013/01/26/v-fullstory/3201660/watching-tv-on-web-is-disrupting.html#storylink=cpy
Read more here: http://www.miamiherald.com/2013/01/26/v-fullstory/3201660/watching-tv-on-web-is-disrupting.html#storylink=cpy
Read more here: http://www.miamiherald.com/2013/01/26/v-fullstory/3201660/watching-tv-on-web-is-disrupting.html#storylink=cpy
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What are the problems that need solving?
I can think of a couple