The current television business model will fail

Published: June 13, 2009Posted in: business, copyright, intellectual property, law, technologyTags: , , , , , ,

Braun HF 1, Germany, 1959

Henry Blodget writes in the Silicon Valley Insider that:

Thus far, the TV indus­try has reacted to these changes [more ways to get sim­ple enter­tain­ment at home, new ways to get TV con­tent, fewer lim­i­ta­tions on dis­tri­b­u­tion] the way most peo­ple would: By try­ing to port its exist­ing model to the new world and main­tain its hold on power and money. This is why we’re get­ting so many ridicu­lous, consumer-​​unfriendly TV solu­tions, such as:

  • Market-​​based con­trol over what you can and can’t watch (thanks to con­tracts with local cable companies),
  • No live-​​streaming of lots of pop­u­lar video con­tent despite the fact that this would grow the audi­ence (same reason),
  • Time-​​shifting of pop­u­lar shows (don’t want to can­ni­bal­ize more prof­itable TV audience)
  • Hoarding of video libraries that could be eas­ily avail­able, watched, and mon­e­tized online
  • Single episode down­loads that expire after 24 hours
  • $150/​month “triple-​​play” solu­tions that come larded up with absurd taxes, fees, and service-​​charges, most of which go to pay for crap we don’t want.

All these Band-​​Aid solu­tions will even­tu­ally fail. Why? Because even­tu­ally the cable-​​satellite-​​airwave monop­oly over TV con­tent in local mar­kets will be cir­cum­vented by sim­ple, global Internet distribution.

via Sorry, There’s No Way To Save The TV Business.

I agree that the tele­vi­sion indus­try is where news­pa­pers were 10 years ago — in denial that they need to change their busi­ness model. They have tried, on occa­sion, to argue that skip­ping com­mer­cials is “steal­ing” and sim­i­lar types of argu­ments. They are, as Henry points out, still mak­ing money — so they can afford to ignore the changes. I pre­dict that, as inevitable as the death of their cur­rent busi­ness is, their attempt to leg­is­late con­tent pro­tec­tions is as inevitable (as news­pa­pers have tried to do).

Thus, the cur­rent loose tol­er­ance for Bittorrent shar­ing will evap­o­rate in favor of dra­cion­ian enforce­ment attempts like the MPAA and RIAA. Rhetoric will esca­late, and we’ll all (tem­porar­ily) become “pirates.” Hopefully ser­vices like Hulu will take up the slack quickly enough to pro­vide alter­na­tives before this hap­pens — but don’t count on it.

Still, as I said ear­lier about news­pa­pers, tele­vi­sion pro­duc­tion, like jour­nal­ism, will not die. Only the dis­tri­b­u­tion model will change. Those who adapt will thrive in the long term. So adapt now and suc­ceed while your com­peti­tors fail.

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