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Wednesday, April 12, 2006

New! 4 Top Shows Free To View As An Experiment

The Washington Post is reporting on Walt Disney's announcement that ABC's "Lost" and "Desperate Housewives are to be offered free over the web.

As I’ve noted previously the BBC is currently offering “The Apprentice” with Alan Sugar on their Broadband site.

The Washington Post article says later on it means that the media world and TV in particular will never be the same again.

Think for a moment what it means:

What Happens To Profits If We Watch "Lost" For Free?

In the short-term Disney are going to be able to get two bites of the advertising cherry for the programmes they've run on the TV channels.

Other countries will get to see these programmes over the internet.

That means that they're going to lose out on the revenue for selling shows like "Lost" and "Desperate House Wives".

How Are Disney, ABC and The BBC Going To Make-up Their Profits?

In the medium-term they're going to work out a model where we pay for watching the shows, of course!

What that means is that the media company will sell direct to the world public.

The media buyer at any country's TV station is going to be buying less shows, or buying more expensive to guarantee first showing. So their revenue/profit is going to drop.

That means other country TV stations are going to have to create their own unique programmes that their audience will watch. Otherwise their advertising revenue is going to plummet through the floor.

Can We Predict What The Media Landscape Looks Like After This?

I've noted in one of my articles that it's easy to see in hindsight how TV and the movies would work together. It's not quite as easy to see how TV and online TV will work together. Mainly because all programmes become video on demand. That means advertising spend can be tied very closely to the number and type of people watching. So why would an advertiser advertise on TV where they’re not even sure their spend is reaching the right people?

Interesting times!

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