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The Spokesman-Review Newspaper
Spokane, Washington  Est. May 19, 1883

Cable TV races to please finicky consumers

Associated Press The Spokesman-Review

ATLANTA — There’s a big power shift in the world of paid television, and not it’s not between the traditional rivals of cable and satellite. Consumers are getting more control over what and how they watch, and cable operators are doing everything they can to cater to their rapidly evolving desires.

As the cable TV industry’s annual trade show got under way in Atlanta Monday, one of the hottest topics was finding ways to keep abreast of consumers’ TV viewing habits, which seem to change daily as shows become available over the Internet, on portable devices, and on DVDs.

Underscoring just how quickly TV business models are evolving, Walt Disney Co.’s ABC announced Monday that it would offer full-length episodes of several of its hit shows, including “Desperate Housewives” and “Lost,” for free streaming over the Internet on the day after they appear on ABC. The shows will be supported by advertising that you can’t skip through.

Disney described the effort as a two-month test, but if it’s successful it could pose problems for cable companies, which are working hard to get more premium shows available on their video-on-demand offerings, one of several promising new business areas for cable.

Anne Sweeney, the president of Disney-ABC Television Group, told a panel discussion at the cable show that the online offerings were designed to add more total viewers to the shows, not to cannibalize viewers from ABC and its affiliates.

“I think you’ll see these models co-exist,” Sweeney said. “None of us can live in a world of just one business model.”

Two top cable executives appeared with Sweeney on the panel and put a good face on ABC’s announcement. Comcast Corp. CEO Brian Roberts and Time Warner Inc. CEO Richard Parsons both spoke of how ABC’s online trial and other initiatives would “grow the pie” of overall viewership.

Yet cable operators continue to struggle to find top-rated shows to drive usage of their growing on-demand services, which currently make up about 5 percent of viewership in the places they’re available, a figure cable executives would like to expand.

ABC has yet to strike a deal to let cable operators offer its hit shows on demand, but CBS and General Electric Co.’s NBC both signed deals this year with Comcast to offer replays of hit shows for 99 cents. Time Warner Cable also offered paid on-demand replays of college basketball games from CBS last month.

Cable executives say their efforts to date to get viewers back to the couch with key services like on-demand viewing have had promising results, but they say more has yet to be done.

Marvin Davis, the head of marketing for Comcast, says cable companies are working to get more data to advertisers on viewership of on-demand shows, and Ryan O’Hara, the president of Gemstar-TV Guide International Inc.’s TV Guide Channel, says on-screen guides need to get “a lot better.”

Cable companies are also hopeful about signing up more customers for digital video recorders, which gives the companies income from monthly fees.

John Hendricks, chairman of Discovery Communications Inc., says that newly empowered TV consumers will drive networks to improve their offerings, putting a “great squeeze” on “marginal quality content,” Hendricks said: “They’re in control now.”