From The Cable Show: So far, over-the-top is overdone
I still love you; I just want to marry other platforms.
During his keynote address at The Cable Show today, Disney President Bob Iger sounded more like Bill Henrickson, the bigamist in HBO’s “Big Love,” than any character found on Iger’s own network as he explained that programmers like Disney want to explore their opportunities, including over-the-top delivery.
Iger asserted plainly, though, that Disney remains bullish on cable as a platform and as a business, and giving away content is not a viable business model.
What happens if content providers make more and more content available for free via the Internet, and subscribers start canceling their video subscriptions in favor of getting their favorite shows via the Web?
That’s the question of the day, but according to the panelists at the Thursday keynote session, it’s a problem of tomorrow.
The executives from MSOs on the panel – Michael Willner of Insight, Glenn Britt of Time Warner Cable, Tom Rutledge of Cablevision and Amy Tykeson of BendBroadband – said they haven’t seen much in the way of subscribers dropping their video services in favor of getting their content through their broadband connections.
The panelists still expect the opposite to be the case. Willner said video is still the last service people drop before they turn off the lights.
Perhaps there are a growing number of people that might drop video before broadband, the panelists allowed, but video remains a very important service.
That said, the business is changing. There is free content out there, Britt noted, and, as he has pointed out in the past and repeated on the panel, “free wins.”
Nonetheless, the free stuff is mostly from the traditional networks that get most of their revenue from advertising and who’ve been providing content over the air for free, anyway. And, yes, there are new sources of free content such as YouTube.
Tykeson said the appointment-viewing model we grew up with is maturing and declining, and the on-demand model is appealing for the younger generation. “How can we sustain terrific entertainment if it’s free?” she asked. There has to be some coming-around-the bend to assure viable business models.
The industry has to figure out a way to make sure people are willing to continue to pay for content. And it has to be a way that allows the industry to make a living out of it, Willner pointed out. If we can’t, he said, it’s going to shut down one of this country’s biggest exports – entertainment.
Asked about consumption-based pricing, the panelists were in accord that subscribers should pay for what they use.
Britt verified reports earlier this week that Time Warner Cable will be rolling out consumption caps in all of its markets.
“You have to give people choice,” Britt said. “If you download movies all day, that costs more. If all you do is go to get e-mail, that costs less. It’s not punitive. We’re going to roll it out more. It’s going to take a long time to see the right configuration of this, but we’re going to work it out.”