Will Tv Succumb to the Internet?
The Internet has transformed the music industry. Sales of CDs in retail music stores have been steadily declining while sales of songs downloaded through the Internet iPods and other portable music players are skyrocketing. Moreover, the music industry is still contending with millions of people illegally downloading songs for free. Will the television industry have a similar fate?
Widespread use of high-speed Internet access, powerful PCs with high-resolution display screens, iPhones and other mobile handhelds, and leading-edge file-sharing services have made downloading of video content from movies and television shows faster and easier than ever. Free and often illegal downloads of some TV shows are …show more content…
“The vision is you can watch your favorite network’s programming on any screen,” noted Time Warner Chief Executive Jeff Bewkes. The system used in the Comcast-Time Warner trial is interoperable with cable service providers’ systems to authenticate subscribers.
The same technology might also allow cable firms to provide demographic data for more targeted ads and perhaps more sophisticated advertising down the road. Cable programmers also stand to earn more advertising revenue because viewers can’t skip ads on TV programs streamed from the Web as they do with traditional TV. Web versions of some television shows in the Comcast-Time Warner trial program, including TNT’s The Closer, will carry the same number of ads as seen on traditional TV, which amounts to more than four times the ad load on many Internet sites, including Hulu. Many hour-long shows available online are able to accommodate five or six commercial breaks, each with a single 30-second ad. NBC universal Digital Entertainment has even streamed episodes of series, including The Office, with two ads per break. According to research firm eMarketer, these Web-videos ads will generate $1.5 billion in ad revenue in 2010 and $2.1 billion in 2011.
Will all of this work out for cable industry? It’s still too early to tell. Although the cable programming