Don’ t look for Time Warner’s TV Everywhere, “an attempt to make broadcast and cable programming available online, on-demand and free with a cable subscription,” to be a free ride once the cable bill is paid. AdAge takes a look at the venture based on panel discussions at the Cable & Telecommunications Association for Marketing Summit in Denver.
The advertising model calls for a full load of commercials. “Jack Wakshlag, chief research officer at Turner Broadcasting, said a typical on-air episode of ‘The Closer’ runs 18 ads, which is why it makes little to no revenue sense for the network to run the same episode online with a third of the same commercials against it. ‘If I can get 4.5 times my TV CPM online (the cost to advertisers to reach 1,000 viewers), I’d be happy and wouldn’t need to do anything,’ he said. ‘But nobody’s getting four times TV CPMs online. Nobody at Hulu’s getting twice the TV CPMs. If people who already watch the show see it with a full commercial load, it’s still a chance to catch up on shows they miss.’
Over at Hulu, the ad-supported online-television site jointly owned by NBC Universal, News Corp. and Walt Disney, CEO Jason Kilar was cited widely last week for implying that a paid model was in the works. “We are capitalists. That’s why we’re Hulu.com and not Hulu.org. We’re very proud of the path we’re on now in terms of monetizing content. With our business model … the revenue needed to support that is anything but free.”
“Comcast and Time Warner Cable have both launched early trials of TV Everywhere,” AdAge says, “including a summer test in 15,000 Comcast households that included 17 cable networks. It’s been estimated that 30 million to 40 million cable households will be ready for authentication by summer 2010.”