If there was ever any doubt that TV companies are still trying to figure out what they want to be in the next life, current events should lay the question to rest. There are three high-profile battles going on right now that illustrate how difficult it is to determine the best business model for TV going forward. First there’s the escalation of retransmission arguments, second comes the growing skepticism of studios wondering how TV Everywhere can provide real revenue, and third is the rapid decline in hopes for the retail Tru2way market.
On the retransmission front, Time Warner Cable continues to fight content owners publicly in an attempt to lower their licensing costs. (Disney being the current opponent) Lurking on the sidelines of this fight is the reality that a portion of the content Time Warner pays Disney to distribute is also available to consumers for free online. The online distribution channel is still a wild-west frontier, and until the big operators and the big studios figure out a way to negotiate the new terrain, it will continue to cause problems in ongoing retransmission debates. (Ryan Lawler’s piece on this over at GigaOM Pro is worth a read, though it requires a subscription.)
Speaking of online distribution, big-name networks like Discovery and MTV are now voicing their skepticism over how TV Everywhere initiatives can benefit them. They argue that VOD has never delivered on its revenue potential, and that TV Everywhere promises more of the same. (Note: Discovery has been loudly critical of VOD on numerous speaking panels I’ve witnessed.) Again, the issue here comes down to where the money comes from, or, perhaps more importantly, where it should come from.
Finally, there’s the virtual death of the retail Tru2way market. Panasonic announced it will no longer sell its Tru2way TV sets in retail, taking away the one shining example industry advocates have held up in the past to argue Tru2way as a viable retail technology. Tru2way was supposed to bring video-on-demand to the masses without a set-top. But the combination of difficulties in getting two major industries to work together (cable and consumer electronics) plus the success of over-the-top video worked to derail Tru2way for the retail audience.
What’s the point of all this? In short, content providers and content owners need to move quickly to figure out new ways create and manage revenue – ways like personalizing content, delivering content to multiple screens, and rapidly introducing new content-based services. (Hence the reason Motorola introduced Medios in May) The major players in the industry know this. The question is who will move fast enough to avoid escalating battles for revenue in the future.