The internet is not going to take over TV, says Jeff Bewkes, Time Warner CEO. “TV [is] disintermediating the internet, taking over the internet, not the other way round.” TV Everywhere, not Internet Everywhere?
Bewkes makes several important points in his presentation at the FT Digital Conference in London on April 25, 2013. Bewkes claims, “We all have to realize there is no distinction between TV and digital media. All TV is basically digital.” He acknowledges that nonlinear TV is the future: timeshifting is here to stay. VOD and OTT providers like Netflix are providing profitable markets.
He also argues that programming supported solely by advertising may not survive. Subscription revenue, Bewkes claims, is necessary for high quality programming. If true, does that mean that the legacy pay TV subscription bundle model is the best option? Or will that subscription model have to adapt and provide more options to viewers?
Can the television industry, having enjoyed several decades of fat profits based on oligopoly distribution control, actually transform the internet, or the streaming video part of it, into a closed proprietary system requiring subscription fees for access? Could this be wishful thinking on the part of someone insisting that his business model is not broken?
Or is Bewkes merely pointing out to the TV industry that profits are to be made in streaming TV, that the sky is not falling. And that instead of insisting on an essential difference between “TV” and “the Internet,” the TV industry should move quickly to keep viewers satisfied by providing legitimate streaming services.
OK, but when will subscription prices reflect programming’s actual value to viewers? How much longer will viewers like me be forced to pay for ESPN before we cut the cord?