Why isn’t all TV on demand
Over the weekend, since I’m without cable TV, I’ve thought a lot about how the current model of television is broken in the “digital revolution”. The biggest question I have at this point is, why isn’t all TV on-demand TV (similar to what’s being called IPTV)?
Why TV doesn’t work
Among the various reasons why I think all TV should be on demand, the front runner is scheduling. I understand that television schedules are made with various factors in mind — when is the biggest audience available to watch, what day do most audiences watch TV, etc. — but in order to find a new, profitable option to make all TV on demand that type of mentality will need to change, at least somewhat.
Another flaw with traditional network television is that there is no real network loyalty. Ask any TV watcher who their favorite network is and they will probably only list off the shows they like. Everyone has show loyalty and will tend to follow that particular show, or list of shows, until it’s cancelled.
For some reason cable and satellite providers always require audiences/customers to purchase packages of channels. This would be fine if we were all given a choice as to what channels we wanted but we don’t. The cable provider always dictates what channels are in what package — or they charge a higher fee for you to get only the channels you want.
The last failure of TV I’ll mention is the ratings system. I don’t believe that, in this day and age of connectivity, that polling a small number of households on what they watch is a good way of getting a true account of how many people are actually watching any particular show. With so many houses using satellite, Tivo and digital cable boxes why can’t the ratings system get the information from everyone connected instead of a small cross section?
Because cable or satellite television is a service oriented business, why not cater to your customers? It would only make sense that instead of punishing their customers because they chose you can’t you treat your customers with a little respect and choice?
The alternative: Make TV shows downloadable
Using Bit Torrent to download TV shows, especially ones that audiences are a fan of but because of scheduling they had to miss, is a very, very popular practice these days. For some shows you can start downloading the latest episode within a couple hours after it airs. Instead of castrating this system why can’t the networks use it to their advantage?
Since audiences have a much stronger loyalty to individual shows, why not build a model that focuses on that? With an attentive audience already available it wouldn’t take any extra effort to promote the shows, just a slightly different way to monetize them.
Let’s take the Apple iTunes store for example. You can purchase a season pass for any particular series you like and freely download each episode as it becomes available. You are then free to watch it whenever you like. This model alone has already countered the first two points I made above about the broken system. Just throw in some tracking to the downloads and get some demographics on the accounts that purchase season passes and there are your ratings.
At the same time, if you want to check out a show but you’re not sure if you’ll like it all you have to do is purchase a single episode and watch it. No commitment to watching a full season if you don’t like the show and no commitment to paying for a channel you’ll only watch occasionally if you do like it.
Make the downloads High Definition
In order to make a new model and make it profitable the networks should look at downloads/Bit Torrents the way that Apple has with one major difference, higher, much higher quality (HD at least). Right off the bat this gives the networks much higher priority in the minds of potential purchasers.
Scheduling
Scheduling is a sore spot for me with the current TV model. The fact that two or three new industries were created to compensate for televisions scheduling conflicts should tell us something. Obviously for the sake of maintaining the audiences that aren’t interested in downloading shows the networks would need to maintain their current release schedules.
For the downloading customers I would think that simply releasing the shows on the same day as they air — or the day after — would be a simple enough schedule. Instead of having the download customers waiting until certain times to buy and download it they would just need to download it whenever they have time after it has been released for purchase/download.
Making downloadable TV profitable
Obviously there is more than one way to make money from downloadable TV. The first area to investigate is pricing structure and it could be broken down into two simple options:
- High Definition downloads with no commercials; for a higher price
- Standard broadcast quality with commercials; for a lower price or free (preferably free since the commercial slots have been sold and the networks are reaching the same or more people)
What about DRM?
The biggest argument against having downloadable shows from the networks is the issue of piracy and Digital Rights Management. If we take a look at the issue from the network’s perspective, there are a few options available.
- Option 1: No specific DRM on the files themselves but make the Bit Torrent app load an authentication key for each show the viewer has purchased (which would have been emailed to them after purchase)
- Option 2: A secure download area for purchasers only (which could also include advertising)
- Option 3: More traditional DRM approach with authorized computers (similar to the iTunes model)
What are the benefits of creating downloadable TV?
With a new model based on electronic distribution as opposed to traditional methods, the networks would be allowing more choice as well as building bigger, more loyal audiences for their shows. By building more loyal audiences the network and show will receive a higher level of word-of-mouth advertising (be it on blogs, websites, or in casual conversation).
These more dedicated audiences would then, if what I’ve seen as an example from current Bit Torrent downloaders stays true, grow immensely. Now people could download and watch even more TV than they already watch. This would also allow — watch out, buzzword coming — more viral audiences as well. With good shows the word would spread like wildfire and more people could watch more episodes and even purchase episodes they missed. With more people watching the shows the advertising prices would go up exponentially allowing the network to continue with that very popular and profitable revenue stream.
Another benefit is the extended life of shows that don’t quite cut it in the traditional television market. Shows like Arrested Development, The Family Guy, Futurama, etc. could have capitalized on these viral, dedicated audiences to ensure they stayed on the air (the first time). Audiences would have more power to save their favorite TV shows and the networks would be able to support them because of these dedicated audiences of customers.
Most importantly using this type of model would give audiences the choice and ability to follow all of the shows they enjoy. If I could follow all of the shows I like to watch all season long and watch them whenever I want I would definitely shell out the dollars for it. I would also drop my traditional cable TV as, I’m sure, most of my friends and family would as well.
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It will be years before all TV goes towards an on-demand type of system. Obviously moves have been made, in smaller and larger steps, towards that end - but again it will be many years before it takes real root.
However, once the minority (being of the digital download user type) becomes the majority - things will change.
Colin D. Devroe on September 26th, 2006 3:14 pm
You’re right, it will be years if not decades before all TV goes in an all on demand direction. What I’m hoping for is some type of early adopters to meet and greet with the network execs and at least start the ball rolling. There is obviously a market out there and even though it’s small — in comparison to the regular TV audience — it is an outspoken one and one that is willing to pay for quality.
Mike Stickel on September 26th, 2006 4:56 pm
I’m actually experiencing some of my first OnDemand TV down here at State College. Adelphia provides a pretty good number of channels where movies and some TV shows are available any time to purchase/rent at any time. These shows don’t extend to the network shows, but they are always slow to catch on to any emerging technology. And I think that’s the biggest problem. A lot of the people in charge are content with how things are. Change is always bad. So exactly what you guys are saying, is that it will take a while. The chance has to show some value to be accepted. Awesome post by the way, I took a couple courses in TV networks and shows and it’s really cool to see how it all really works. One thing to keep in mind is networks don’t care what they play. TV is there for the commercials. As long as it’s popular enough (harder to determine with all the ways people watch TV now as you wrote) they will sell more ad time. Sad, but true.
Sameer on September 29th, 2006 1:43 am
It’s unfortunate that there are no real forward thinking individuals with any sort of power in network TV or even Hollywood for that matter. If only there was some way to break the cycle and reward creative solutions and forward-looking/thinking people in this industry.
Mike Stickel on September 29th, 2006 9:19 am
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You are right and I can see the shift start to happen.
J R Mortland III (Bob) on October 16th, 2006 12:22 am
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I was actually thinking about this last night. There would be no need for scheduled tv. The new episodes would be released on the same day they normally would, but you could watch them at any time. It would be perfect!
mike on January 29th, 2007 11:27 am
mike: Yes, it would be perfect. They have the traditional model as well as a new revenue stream.
At this point I wouldn’t have any problem with an additional TV model. It will be decades before traditional TV moves to an on demand model. I just want to see some progress made in this direction.
Last year was the beginning of the year of video on the web and that will only continue. Unless the TV/video market wants to get screwed like the music industry did they better get moving.
Bob is right though, there is a small shift happening. I’m just too impatient for this to get some sort of momentum behind it.
Mike Stickel on January 30th, 2007 12:39 pm