Cable Companies Press Forward With TV Everywhere Despite Uncertainties
Giving consumers mobile access to cable content is a necessary reality, despite the difficulty of monetizing such TV Everywhere, executives from Comcast, Fox Networks, Turner Broadcasting and Univision told an NCTA conference. Though TV Everywhere presents difficulties for authentication and mobilization across a multitude of platforms, moving forward with the technology is the only option, they said.
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Since content is available on many mobile and Internet platforms, “you'd be foolish to stick your head in the sand,” said Mike Biard, Fox Networks executive vice president-distribution, speaking on a panel on TV Everywhere at the Cable Show. “To pretend that somehow we can unring the bell and pull it back is silly. It’s not immediately monetizable in the traditional sense, but we believe that it will be.” Ron Lamprecht, NBCUniversal executive vice president-business development and sales, agreed: “We see the engagement, we see the consumption happening. If you just go with that simple thought, that can be all that drives you” to adopt the technology.
Because it’s tough to track consumers on different devices, monetizing the expansion of TV Everywhere is tricky and not where it should be, said Rob Thun, Univision executive vice president-business operations. But Comcast’s Marcien Jenckes, senior vice president-video services, said there’s more money to be had in TV Everywhere than others might think. “Everybody makes money from TV Everywhere,” he said. “The reality is that programmers get paid from distributors and affiliate fees, at about $40 million a year, roughly. There is almost the same amount of additional revenue they generate from content on top of it. Every year, content costs go up, and every year customers’ expectations as to what they get from [the] subscription model go up.” Customers are clear in their demand for TV Everywhere experiences, he said. “On some level, shame on us if we are not more aggressively out there delivering those experiences to our customers."
Many people refer to TV Everywhere as though it’s a product, said Jeremy Legg, Turner senior vice president-business development and multi-platform distribution. But TV Everywhere is a project or an initiative or a platform, he said: It isn’t something the industry has done before, and it can’t reasonably be compared to anything they've worked to monetize in the past. He said that unlike the proliferation of set-top boxes, which were cable industry-designed and implemented, the proliferation of mobile devices has cable companies scrambling to address authentication and technology issues on devices they do not control or operate. When troubles arise, they can’t rework the operating system of an iPhone -- they have to operate within another company’s platform, Legg said.
Increases in password sharing do not trouble Fox’s Biard, who said about 90 percent of homes subscribe to cable services. “We spend a lot of time talking about the 10 percent who aren’t, but as far as I know there aren’t a lot of the 10 percent climbing over walls to get to the pay TV world,” he said. At the same time, he said TV Everywhere could even reduce piracy. When Fox introduced a “holdback” period, wherein content would not be available online until eight days after it aired on TV, he said piracy increased “significantly.” Having authenticated content available to paying customers on any device can alleviate those issues, he said.
Jenckes said he had seen similar results when Comcast partnered with Yale University to allow students to access content online and on mobile devices. Though Yale paid for Comcast subscriptions in its student housing, he said, it did not have a system for authenticating those students as individual Comcast customers until recently. Once it adopted such a system, Yale saw piracy of online content decrease substantially, he said.
One of the toughest challenges for cable companies hoping to expand their TV Everywhere offerings is dealing with different rights for in-home and out-of-home viewing, Lamprecht and others said. Networks aren’t willing to offer live or VOD streaming rights for the same price as broadcast rights, and rights can also differ depending on how and when the content will be viewed, Jenckes said. Even for networks with impressive TV Everywhere offerings, certain shows will be “blacked out” because cable companies don’t have the proper rights to broadcast the show on certain devices, he said.
Nielsen, which has trials with several operators to test its ability to track viewership numbers on mobile devices, is both “flawed” and “the best solution we have,” Jenckes said. Though Nielsen isn’t a perfect company and its offerings aren’t the best-case scenario, he said, “we want them to be successful, because we think they can answer the questions that you started with: ‘How do you get paid?’ As aggressively as we can, we work with Nielsen on measurement of TV Everywhere.”
Despite the challenges, the demand for TV Everywhere is still high, Lamprecht said. “People are actually consuming, they're actually watching our content,” he said. “Just in general consumption is up, live and on demand. The issue we have is the way people are consuming is very different than they have historically.” And though the challenges are obvious, at least people are consuming the content in impressive numbers, he said.