When HBO landed on the scene in the 1970s it unwittingly pioneered consumers to subscribe to premium TV programming over copper cable wires. That was unheard of back then. It's now the norm when we sign up for cable TV. We expect to be presented with several packages, including deluxe networks like ESPN, HBO or Showtime that require an additional fare. However, a new business model for TV is emerging.
It's no secret that consumers in droves are tuning out ads using TiVo or DVRs. This is forcing the networks to try all kinds of new distribution models. Though the approaches vary, they share some things in common. One, they're letting people own ad-free programming forever by selling it over the Web. Two, they're peddling this content on an a-la-carte or a subscription basis, whether it be on Google Video, Apple iTunes or starting next week on MySpace. And three, they're teasing out ad-free portions of shows for free using podcasts. Notice how many times I said "ad-free."
As the technology gets more sophisticated and the generation that grew up with the Internet , iPods and always on connections become adults, I see a day coming when a lot of TV content will a) be paid for and b) consumed ad-free.
Now, some content will always remain free and ad-supported. However, in the future - as technology progresses - you will have to pay for the best programming, even if it's carried by ABC, NBC, Fox or CBS. These shows will be sold a-la-carte, as subscriptions or in packages and they will all be delivered over the Internet protocol. Once purchased you will be able to watch these shows on any number of portable devices/phones, a computer or on your Internet-connected HDTV.
So what happens to all those advertising dollars? Good question. Stay tuned to find out, but not to your TV.
(Fine print: MySpace is an Edelman client)
UPDATE: I didn't see this before I wrote my post, but digg says Alex Beam has a similar thought.
Technorati Tags: Google Video, HBO, iTunes, MySpace
